ITEM 2.01 Completion of Acquisition or Disposition of Assets
September 25, 2013, WoodGate Energy Corporation, a Delawarecorporation (the "Company"), completed the acquisitions of two entities in separate stock-for stock transactions (collectively, and together, the "Acquisitions): (1) E&P CO, LLC, a Texaslimited liability company ("EPCO") and (2) Prestige O&G, LLC, a Texaslimited liability company ("Prestige"). The purpose of the Acquisitions was to facilitate and prepare the Company for a registration statement and/or public offering of securities. The acquisition by the Company of EPCO is referred to herein as the "EPCO Acquisition," and the acquisition by the Company of Prestige is referred to herein as the "Prestige Acquisition." The EPCO Acquisition was effectuated by the Company through the exchange of each of the outstanding membership units of EPCO for 10,000 shares of common stock of the Company. As a result, in the EPCO Acquisition, all of the outstanding membership interests in aggregate of EPCO were exchanged for, and converted into, 13,337,280 shares of common stock of the Company. In addition, as part of the EPCO Acquisition, EPCO's outstanding debt was converted into shares of common stock of the Company, resulting in 13,296,950 shares of common stock of the Company being issued to holders of EPCO's debt. Hence, the Company issued a total of 26,634,230 shares of common stock of the Company in the EPCO Acquisition. The Prestige Acquisition was effectuated by the Company through the exchange of each of the outstanding membership units of Prestige for 10,000 shares of common stock of the Company. As a result, in the Prestige Acquisition, all of the outstanding membership interests in aggregate of Prestige were exchanged for, and converted into, 10,115,770 shares of common stock of the Company.
In sum, a total of 36,750,000 shares of common stock of the Company were issued in the Acquisitions.
EPCO was formed in
June 2005in the State of Texas, and is engaged in the development, drilling and production of coal bed methane (CBM) gas on a concession located in the State of Louisiana. EPCO is engaged in the exploration and development of CBM wells, and it currently holds three producing wells and one salt water disposal well, and is in the process of developing additional wells. The main source of revenue for the Company is sale of CBM gas to Regency Gas Services, LLC. EPCO currently has access to about 10,000 net mineral acres of land (through a lease) which has the potential of developing additional
Prestige was formed in
June 2009in the State of Texas, and invests in and develops oil and gas exploration and production projects mainly in the United States. As one of its major investments, Prestige formerly held an interest in EPCO (which interest was withdrawn on June 30, 2013in preparation for the Acquisitions) and is currently a partner with EPCO in its CBM Gas Projectin the State of Louisiana. As a result of the Acquisitions, each of EPCO and Prestige became wholly owned subsidiaries of the Company. The Company, as the sole shareholder of each of EPCO and Prestige, has taken over the operations and business plans of each
of EPCO and Prestige. General
The Company's common stock is not currently trading on any public markets in
As of the date of this report (
The Company has not declared any dividends in its fiscal years ended
December 31, 2012or December 31, 2011, respectively. Similarly, the Company did not declare any dividends during the six months ended June 30, 2013. Currently, the Company has no intention of paying cash dividends in the foreseeable future, but rather intends to use any future earnings for the development of its business in the foreseeable future. Capitalization
The Company is authorized to issue 100,000,000 shares of common stock, par value
$0.0001, of which 47,295,000 shares are outstanding as of the date of this report. The Company is also authorized to issue 20,000,000 shares of preferred stock, par value $0.0001, of which no shares were outstanding as of the date of this report. The following statements relating to the capital stock set forth the material terms of the securities of the Company, however, reference is made to the more detailed provisions of, and such statements are qualified in their entirety by reference to, the certificate of incorporation and the by-laws. 2 Common Stock Holders of shares of common stock are entitled to one vote for each share on all matters to be voted on by the stockholders. Holders of common stock do not have cumulative voting rights.
Subject to preferences that may be applicable to any outstanding shares of preferred stock, the holders of common stock are entitled to share ratably in dividends, if any, as may be declared from time to time by the board of directors in its discretion from funds legally available therefor.
Holders of common stock have no preemptive rights to purchase the Company's common stock. There are no conversion or redemption rights or sinking fund provisions with respect to the common stock. The Company may issue additional shares of common stock which could dilute its current shareholder's share value.
Preferred Stock Shares of preferred stock may be issued from time to time in one or more series as may be determined by the board of directors. The board of directors may fix the designation, powers, preferences and rights of the shares of each such series and the qualifications, limitations or restrictions thereof without any further vote or action by the stockholders of the Company, except that no holder of preferred stock shall have preemptive rights. Any shares of preferred stock so issued would typically have priority over the common stock with respect to dividend or liquidation rights. The board of directors does not at present intend to seek stockholder approval prior to any issuance of currently authorized stock, unless otherwise required by law or otherwise.
March 2013the Company entered into an engagement agreement with Tiber Creek Corporation, a Delawarecorporation ("Tiber Creek"), whereby Tiber Creek would provide assistance to the Company in effecting transactions for the Company to combine with a public reporting company, including: transferring control of such reporting company to the Company; preparing the business combination agreement; effecting the business combination; causing the preparation and filing of forms, including a registration statement, with the Securities and Exchange Commission; assist in listing its securities on a trading exchange; and assist in establishing and maintaining relationships with market makers and broker-dealers. Under the agreement, Tiber Creek is entitled to receive cash fees from the Company. In addition, the Company's then-current shareholders, Tiber Creek and MB Americus, LLC, a Californialimited liability company ("MB Americus"), were permitted to retain the aggregate total of 500,000 shares.
In general, Tiber Creek holds interests in inactive
ITEM 3.02 Unregistered Sales of
Recent Sales of
The Company has issued the following securities in the last three (3) years. All such securities were issued pursuant to an exemption from registration of the Securities Act of 1933, as amended, as a transaction by an issuer not involving any public offering, as noted below. Each of these transactions was issued as part of a private placement of securities by the Company in which (i) no general advertising or solicitation was used, and (ii) the investors purchasing securities were acquiring the same for investment purposes only, without a view to resale. Furthermore, no underwriters participated or effectuated any of the transactions specified below. Also, no underwriting discounts or commissions applied to any of the transactions set forth below. All potential investors were contacted personally and possessed at the time of their investment bona fide substantive, pre-existing business relationships with the Company and/or its officers, directors and affiliates. No potential investors were contacted through other means, and no general advertising or general solicitation was
used to solicit any investors. (1) On
July 31, 2012, 10,000,000 shares of common stock were issued to Tiber Creek Corporationfor total consideration paid of $1,000.00. Subsequently, on May 16, 2013, the Company redeemed an aggregate of 9,750,000 of these shares for the redemption price of $975.00(2) On July 31, 2012, 10,000,000 shares of common stock were issued to MB Americus, LLCfor total consideration paid of $1,000.00. Subsequently, on May 16, 2013, the Company redeemed an aggregate of 9,750,000 of these shares for the redemption price of $975.00
Names of Shareholders No. of shares Consideration E&P Management and Development Co., LLC 3,821,396
$ 382.14Caldwell US, Inc. 1,774,000 $ 177.40Rasan Associates, LLC 100,000 $ 10.00 Delta O&G, LLC 552,604 $ 55.26 Rasan Private Equity 100,000 $ 10.00 Rasan Energy 2,400,000 $ 240.00Univest 2,000 $ 0.20 (4) Beginning in July 2013, shares of common stock were issued by the Company to the shareholders named below pursuant to executed subscription agreements under a Regulation D offering. The Company filed a Form D in August 2013. Names of Shareholders No. of shares Consideration Saad Salah Al-Ghanim 75,000 $ 75,000Ahmad Yousef Al-Khalaf 30,000 $ 30,000Yousef Yakoob Al-Salman 60,000 $ 60,000 Al-Rawda Investmentfor Real Estate Development and Projects Management Co. 500,000 $
Al Majmow International Trading Est. 100,000 $
100,000 Al Wadi Limited Co. 100,000
$ 100,000Mashhhoor Ali O Almadodi 80,000 $ 80,000Fatmah Abdulgader A Radwan 60,000 $ 60,000Hajar Mashhor A Almadodi 30,000 $ 30,000Zainab Mashhour A Almadodi 30,000 $ 30,000Khawlah Mashhoor A Almadodi 30,000 $ 30,000Aisha Mashhour A Almadodi 30,000 $ 30,000Ali Mashhoor A Almadodi 30,000 $ 30,000Mahmoud Mashhour A Almadodi 30,000 $ 30,000Fuad Hamed Al-Humoud 10,000 $ 10,000Hamad Fuad Al-Humoud 10,000 $ 10,000Abdulaziz Fuad Al-Humoud 10,000 $ 10,000Khaled Rashed Al-Hajeri 10,000 $ 10,000Fakhrieh Muhammad Al-Hajeri 10,000 $ 10,000Munirah Khaled Al-Hajeri 10,000 $ 10,000Rashed Khaled Al-Hajeri 10,000 $ 10,000Sarah Khaled Al-Hajeri 10,000 $ 10,000Muhammad Khaled Al-Hajeri 10,000 $ 10,000Ali Khaled Al-Hajeri 10,000 $ 10,000Abdullah Khaled Al-Hajeri 10,000 $ 10,000
Shareholder Name Number of Shares
Caldwell US, Inc.6,542,580 Rasan Associates, LLC274,377 EPMD, LLC5,057,885 Delta O&G, LLC1,462,438
Shareholder Name Number of Shares
Caldwell US, Inc.210,528 Rasan Associates, LLC2,000,000 Rasan Private Equity, Inc.1,498,592 EPMD, LLC8,578,827 Delta O&G, LLC1,009,003 15 (7) On September 25, 2013, the Company issued 10,115,770 shares of common stock to members of Prestige in connection with the Prestige Acquisition, as follows: Shareholder Name Number of Shares Caldwell US, Inc.5,057,885 EPMD, LLC5,057,885
ITEM 5.02 Change in Number of Directors; Election of Directors
In connection with the Acquisitions, the Company has expanded its size of the board of directors to four (4) seats. The term of each director shall be three (3) years.
ITEM 5.06 Change in Shell Company Status
The Company has acquired EPCO and Prestige, each of which has a defined business plan, and accordingly, the Company has commenced operations.
ITEM 9.01 Financial Statements and Exhibits
The audited financial statements of EPCO, including balance sheets as of
June 30, 2013, December 31, 2012and December 31, 2011, respectively, and the related statements of operations, changes in members' equity (deficit), and cash flows for the six months ending June 30, 2013, year ending December 31, 2012and the year ended December 31, 2011, respectively, are included herewith. The audited financial statements of Prestige, including balance sheets as of June 30, 2013, December 31, 2012and December 31, 2011, respectively, and the related statements of operations, changes in members' equity (deficit), and cash flows for the six months ending June 30, 2013, year ending December 31, 2012and the year ended December 31, 2011, respectively, are included herewith. Exhibits 2.1+ Exchange Agreement 2.2.+ Exchange Agreement 10.1+ Coalbed Methane Lease 10.2+ Amendments to Coalbed Methane Lease 10.3+ Agreement with Regency Gas10.4+ Amendments to Agreement with Regency Field Services 10.5 Agreement with Tiber Creek Corporation10.6 Funding Arrangement with Rasan Private Equity 10.7 Employment Agreement of Stephen Spafford10.8 Employment Agreement of Samta Gupta. + Previously filed with Form 8-K on October 4, 2013as the same exhibit number as the exhibit number listed here, and incorporated herein by this reference. 16 Clay Thomas, P.C. Certified Public Accountant P.O. Box 311195 Houston, Texas 77231 (281) 253-9637 (office) REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Members of E & P Co., LLCI have audited the accompanying statement of financial position of E & P Co., LLCas of June 30, 2013and December 31, 2012, and the related statements of income, members' equity and cash flows for each of the periods ending June 30, 2013and December 31, 2012. E & P Co., LLC'smanagement is responsible for these financial statements. My responsibility is to express an opinion on these financial statements based on our audits. I conducted my audits in accordance with the standards of the Public Company Accounting Oversight Board( United States). Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The company is not required to have, nor was I engaged to perform, an audit of its internal control over financial reporting. My audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company's internal control over financial reporting. Accordingly, I express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. I believe that my audits provide a reasonable basis for my opinion. In my opinion, the financial statements referred to above present fairly, in all material respects, the financial position of E & P Co., LLCas of June 30, 2013and December 31, 2012, and the results of its operations and its cash flows for each of the periods ending June 30, 2013and December 31, 2012in conformity with accounting principles generally accepted in the United States of America. [[Image Removed]] Houston, Texas September 10, 2013 17 E & P Co., LLC Statement of Financial Position For the Years Ending June 30, 2013 and December 31, 2012 2013 2012 ASSETS Current Assets Cash and Cash Equivalents 34,900 47,762 Accounts Receivable 655 933 Accounts Receivable- Related Party - 751,231 Total Current Assets 35,555 799,926 Other Current Assets Prepaid Expense 12,500 12,500 Refundable Deposits 11,204 11,204 Total Other Current Assets 23,704 23,704 Total Current Assets 59,259 823,630 Fixed Assets Intangible Assets 8,157,352 - Project Under Development 9,137,323 18,318,960 Property and Equipment 33,403 33,403 Furniture and Fixtures 39,236 39,236 Accumulated Depreciation (70,470 ) (69,746 ) Total Fixed Assets 17,296,844 18,321,853 TOTAL ASSETS 17,356,103 19,145,483 LIABILITIES & EQUITY Liabilities Current Liabilities Accounts Payable 177,447 640,075 Accounts Payable - Related Party 68,124 58,335 Accrued Expense 360,049 126,563 Total Accounts Payable 605,620 824,973 Other Current Liabilities Notes Payable - Related Party 798,367 714,928 Total Other Current Liabilities 798,367 714,928 Total Current Liabilities 1,403,987 1,539,901 Long-Term Liabilities Notes Payable - Related Party 9,092,467 12,937,500 Total Long-Term Liabilities 9,092,467 12,937,500 Total Liabilities 10,496,454 14,477,401 Equity Members' Capital Accounts 6,859,649 4,668,082 Total Equity 6,859,649 4,668,082 TOTAL LIABILITIES & EQUITY 17,356,103 19,145,483
See accompanying notes to the financial statements.
18 E & P Co., LLC Statement of Operations For the Six Months Ending June 30, 2013 and 2012 2013 2012 Ordinary Income Income Income 2,141 907 Total Income / (loss) 2,141 907 Direct Operating Costs Drilling and Production Expense - 268,394 Geographical and Geological 2,212 1,845 Royalty 19,594 113 Total Direct Operating Costs 21,806 270,352 General and Administrative Costs Advertising - - Bad Debt 107,302 - Bank charges 453 165 Communication 412 3,386 Depreciation and Amortization 723 - Employee Insurance 4,512 4,272 Insurance 8,708 8,167 License Fees 126 126 Miscellaneous 265 608 Office Equipment 930 600 Payroll 223,869 226,555 Professional Fees 358,174 218,058 Rent 19,692 20,784 Stationery 1,125 965 Taxes 4,028 - Travel and Accommodations 11,375 16,706 Utilities 1,667 538 Total Professional Fees 743,361 500,930 Total Expense 765,167 771,282 Other Income/Expense Other Income - - Other Expense - 12,019 Total Other Income/Expense - (12,019 )
Net Ordinary Income / (loss) (763,026 ) (782,394 )
Net Income / (loss) (763,026 ) (782,394 )
See accompanying notes to the financial statements.
19 E & P Co., LLC Statement of Cash Flows For the Six Months Ending June 30, 2013 and 2012 2013 2012 Operating Activities Net Income (763,026 ) (782,394 ) Adjustments to reconcile Net Income to net cash provided by operations: Accounts Payable (454,619 ) 387,345 Accounts Receivable 751,231 (94,163 ) Accrued Expense 233,486 (12,036 ) Accrued Gas Sales Income 279 243 Credit Cards (10 ) (27 ) Deposits - (3,928 ) Depreciation 723 - Payroll Tax Liabilities 1,789 5,301 Net cash provided / (used) by Operating Activities (230,147 ) (499,659 ) Investing Activities Intangible Assets (8,157,352 ) - Project Under Development 9,181,636 - Property and Equipment - (388 )
Net cash provided / (used) by investing activities: 1,024,284
(388 ) Financing Activities Notes Payable (3,761,593 ) 555,000 Members' Equity 2,954,594 - Net cash provided by Financing Activities (806,999 )
Net cash increase for period (12,862 )
Cash at Beginning of Period 47,762
3,188 Cash at end of period 34,900 58,141
See accompanying notes to the financial statements.
20 E & P Co., LLC Statement of Members' Equity For the Year Ending June 30, 2013 Members' Capital Accumulated Earnings Total Members' Equity Balance December 31, 2011 7,577,344 (3,803,785 ) 3,773,559 Net Income/ (loss) - (513,999 ) (513,999 ) Balance June 30, 2012 7,577,344 (4,317,784 ) 3,259,560 Member Investment 1,515,000 - 1,515,000 Net Income / (loss) - (106,478 ) (106,478 ) Balance December 31, 2012 9,092,344 (4,424,262 ) 4,668,082 Member Investment 2,954,593 - 2,954,593 Net Income / (loss) - (763,026 ) (763,026 ) Balance June 30, 2013 12,046,937 (5,187,288 ) 6,859,649