10-Q/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Amendment No. 1 to

Form 10-Q

x   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended June 30, 2013

OR

o   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to __________

Commission File No.:  000-54661

EMPOWERED PRODUCTS, INC.

(Exact name of Registrant as specified in its charter)

Nevada	27-0579647
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number

3367 West Oquendo Road, Las Vegas, Nevada 89118 

(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)(ZIP CODE)

800-929-0407

(COMPANY’S TELEPHONE NUMBER, INCLUDING AREA CODE)

_______________________________________________

Former Name

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x     No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes ¨     No x

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

Large accelerated filer  ¨	Accelerated filer  ¨
Non-accelerated filer  ¨	Smaller reporting company   x

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

The registrant had 62,588,856 shares of common stock, par value $0.001 per share, outstanding as of August 13, 2013.

EXPLANATORY NOTE

Empowered Products, Inc. (the “Company”) is filing this Amendment No. 1 (the “Amended Report”) to its Quarterly Report on Form 10-Q for the quarter ended June 30, 2013 that was originally filed with the United States Securities and Exchange Commission (the “Commission”) on August 14, 2013 (the “Original 10-Q”) solely for the purpose of furnishing the XBRL exhibits that were not uploaded with the Original 10-Q due to an error in the file which could not be tested as the electronic filing system was down. Other than what is discussed above, no other changes have been made to the Original 10-Q. This Amended Report speaks as of the original filing date of the Original 10-Q, does not reflect events that may have occurred subsequent to the original filing date, and does not modify or update in any way disclosures made in the Original 10-Q.  Accordingly, this amendment should be read in conjunction with the Original 10-Q. This Amendment No. 1 consists solely of the preceding cover page, this Explanatory Note, the signature page, and the Exhibit List.

Part II. Other Information

Item 6. Exhibits

(a)           Exhibits

Exhibit Number	Description of Document
10.1	Commercial Triple Net Lease with Purchase Option dated as of June 1, 2013 by and between Empowered Products, Inc. and Reich Family Trust 85.†
31.1	Certification of Chief Executive Officer Pursuant to Item 601(b)(31) of Regulation S-K, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.†
31.2	Certification of Controller Pursuant to Item 601(b)(31) of Regulation S-K, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.†
32.1	Certification of the Chief Executive Officer and Chief Financial Officer pursuant to 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.SCH	XBRL Taxonomy Extension Schema Document***
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document***
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document***
101.LAB	XBRL Taxonomy Extension Label Linkbase Document***
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document***

† Previously filed.

** This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, whether made before or after the date hereof and irrespective of any general incorporation language in any filings.

*** Furnished herewith. XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

2

EMPOWERED PRODUCTS, INC.

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.

	Empowered Products, Inc.
Dated: August 15, 2013	/s/	Scott Fraser
	By:	Scott Fraser
	Its:	President and Chief Executive Officer (Principal Executive Officer and Authorized Officer)
	/s/	Kurt Weber
	By:	Kurt Weber
	Its:	Chief Financial Officer (Principal Financial and Accounting Officer)

3

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2. Basis of Presentation and Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2013

Accounting Policies [Abstract]

Going concern

Going concern

As of June 30, 2013, the Company has cash and cash equivalents of approximately $136,000 and an accumulated deficit of approximately $3,809,000. Although the Company generated net income of approximately $309,000 for the three months ended June 30, 2013, based on the current cash position and anticipated cash requirements for the Company to meet its growth targets, additional capital will be required. The Company has managed to generate revenues since inception, however, there is no assurance that the Company will be able to obtain additional debt or equity financing, which raises substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Consolidation

Consolidation

The consolidated condensed financial statements include the accounts of Empowered Products, Inc. and its direct and indirect wholly-owned subsidiaries, Empowered Products Nevada, Inc., Empowered Products Limited, Empowered Products Asia Limited, and Empowered Products Pty Ltd. All material intercompany balances have been eliminated in consolidation.

Revenue Recognition

Revenue recognition

Revenue is recognized when all significant contractual obligations, which involve the shipment of the products sold and reasonable assurance as to the collectability of the resulting account receivable has been satisfied. Returns are permitted primarily due to damaged or unsalable items. Revenue is shown after deductions for prompt payment, volume discounts and returns. The Company participates in various promotional activities in conjunction with its retailers and distributors, primarily through the use of discounts. These costs have been subtracted from revenue and for the six months ended June 30, 2013 and 2012 approximated $8,000 and $18,000, respectively, and approximately $4,500 and $7,300 for the three months ended June 30, 2013 and 2012, respectively. The allowances for sales returns are established based on the Company’s estimate of the amounts necessary to settle future and existing obligations for such items on products sold as of the balance sheet date. The Company records deferred revenue when cash is received or goods are shipped in advance of the revenue recognition criteria being met.

Cost of revenue

Cost of revenue

Cost of revenue includes the cost of raw materials, packaging, inbound freight, direct labor, manufacturing facility costs, and depreciation. Other overhead costs, including purchasing, receiving, quality control, and warehousing are classified as selling and distribution or general and administrative expenses.

At times the Company provides free products to its customers. These free products are accounted for in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 605-50 Revenue Recognition-Customer Payments and Incentives and the cost of the product is recognized in cost of revenue.

Use of estimates

Use of estimates

Management uses estimates and assumptions in preparing these financial statements in accordance with accounting principles generally accepted in the United States of America. Those estimates and assumptions affect the reported amounts of assets and liabilities and the reported revenues and expenses. Such estimates primarily relate to the collectability of accounts receivable, provision for sales returns and allowances, inventory obsolescence, useful life of plant and equipment and the valuation of warrants and stock options. Actual results could vary from the estimates that were used.

Fair value of financial instruments

Fair value of financial instruments

The Company’s financial instruments are cash and cash equivalents, restricted cash, accounts receivable, line of credit, and accounts payable. The recorded values of cash and cash equivalents, restricted cash, accounts receivable, line of credit and accounts payable approximate their fair values based on their short-term nature.

Restricted cash

Restricted cash

Included in restricted cash is a certificate of deposit securing the Company’s line of credit.

Accounts receivable

Accounts receivable

Accounts receivable are carried at the outstanding amount due less an allowance for doubtful accounts, if an allowance is deemed necessary. Allowance for doubtful accounts are established when there is a basis to doubt the full collectability of the accounts receivable. On a periodic basis, the Company evaluates its accounts receivable and determines the requirement for an allowance, based on its history of past write-offs, collections and current conditions. When an account receivable is ultimately determined to be uncollectible and due diligence for collection has taken place, the account receivable is written-off.

Inventory

Inventory

Inventory consists primarily of raw materials and finished goods that the Company holds for sale in the ordinary course of business. Inventory is stated at the lower of cost (determined on the first-in, first-out basis) or market. Other manufacturing overhead costs are also allocated to finished goods inventory. The amount of these allocations to inventory was approximately $130,000 at June 30, 2013 and $111,000 at December 31, 2012, respectively. Management periodically evaluates the composition of inventory and estimates an allowance to reduce inventory for slow moving, obsolete or damaged inventory. An allowance of approximately $45,000 and $57,000 was recorded at June 30, 2013 and December 31, 2012, respectively.

Trademarks and other intangibles, net

Trademarks and other intangibles, net

The Company capitalizes fees in connection with the development of various product trademarks. These assets are considered indefinite lived intangible assets and are reviewed for impairment annually or when circumstances indicate that the carrying amount of the trademark may not be fully recoverable. The amount attributable to trademarks at June 30, 2013 and December 31, 2012 was approximately $521,000 and $516,000, respectively. An impairment loss would be recorded if the carrying amount of the indefinite lived intangible asset exceeds its estimated fair value. The Company performed an impairment test as of December 31, 2012 and concluded that based on its undiscounted cash flows, the related trademarks were not impaired.

Share-based Compensation

Share-based compensation

The Company uses the fair value method of accounting for share-based compensation arrangements. The fair value of stock options is estimated at the date of grant using the Black-Scholes option valuation model. Stock-based compensation expense is reduced for estimated forfeitures and is amortized over the vesting period using the straight-line method.

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Consolidated Condensed Statements of Operations (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Income Statement [Abstract]
Revenue	$ 1,325,926	$ 685,408	$ 2,158,945	$ 1,501,321
Cost of revenue	482,679	408,770	813,561	693,956
Gross profit	843,247	276,638	1,345,384	807,365
Selling and distribution	260,989	252,679	456,184	529,918
General and administrative	269,357	279,970	848,485	519,146
Income (loss) from operations	312,901	(256,011)	40,715	(241,699)
Interest income	72		212
Interest expense	(4,072)	(5,603)	(8,189)	(11,320)
Net income (loss)	$ 308,901	$ (261,614)	$ 32,738	$ (253,019)
Earnings (loss) per share:
Basic	$ 0.00	$ 0.00	$ 0.00	$ 0.00
Diluted	$ 0.00	$ 0.00	$ 0.000	$ 0.00
Weighted average common shares outstanding for basic	62,588,856	62,388,856	62,488,856	62,388,856
Weighted average common shares outstanding for diluted	67,288,856	62,388,856	66,063,856	62,388,856

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5. Plant and Equipment, net

6 Months Ended

Jun. 30, 2013

Property, Plant and Equipment [Abstract]

Plant and Equipment, net

Note 5. Plant and Equipment, net

Depreciation for the three and six months ended June 30, 2013 and 2012 was approximately $13,000 and $17,000, and $30,000 and $33,000 respectively. Cost, accumulated depreciation and estimated useful lives are as follows:

	Estimated	June 30,			December 31,
Category	Useful Lives	2013			2012
Manufacturing and computer equipment	5 - 7 Years	$	381,618		$	381,618
Office furniture and computer software	3 - 7 Years		81,990			78,490
Vehicle	5 Years		19,442			19,442
			483,050			479,550
Less:  accumulated depreciation			(279,681	)		(249,781	)
		$	203,369		$	229,769

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2. Basis of Presentation and Accounting Policies (Narrative) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Dec. 31, 2012
Promotional activities expenses	$ 4,500	$ 7,300	$ 8,000	$ 18,000
Manufacturing overhead costs allocated to finished goods inventory	556,994		556,994		415,176
Trademarks	521,000		521,000		516,000
Manufacturing Overhead
Manufacturing overhead costs allocated to finished goods inventory	$ 130,000		$ 130,000		$ 111,000

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3. Earnings (Loss) per Share (Tables)

6 Months Ended

Jun. 30, 2013

Earnings (loss) per share:

Reconciliation of Numerators and Denominators of Basic and Diluted Earnings Per Share

	Three Months Ended June 30,					Six Months Ended June 30,
	2013		2012			2013		2012
Net income (loss) available to common shares	$	308,901	$	(261,614	)	$	32,738	$	(253,019	)
Basic:
Weighted average shares		62,588,856		62,388,856			62,488,856		62,388,856
Diluted:
Weighted average shares, basic		62,588,856		62,388,856			62,488,856		62,388,856
Dilutive effect of warrants and options		4,700,000		–			3,575,000		–
Weighted average shares, diluted		67,288,856		62,388,856			66,063,856		62,388,856
Basic earnings (loss) per share	$	0.00	$	(0.00	)	$	0.00	$	(0.00	)
Diluted earnings (loss) per share	$	0.00	$	(0.00	)	$	0.00	$	(0.00	)
Weighted average anti-dilutive    shares excluded from diluted EPS		–		2,000,000			–		2,000,000

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5. Cost, Accumulated Depreciation and Estimated Useful Lives (Detail) (USD $)	6 Months Ended
	Jun. 30, 2013	Dec. 31, 2012
Property, Plant and Equipment, Gross	$ 483,050	$ 479,550
Less: accumulated depreciation	(279,681)	(249,781)
Plant and equipment, net	203,369	229,769
Manufacturing and Computer Equipment
Property, Plant and Equipment, Gross	381,618	381,618
Estimated useful lives	5-7 Years
Office furniture and computer software
Property, Plant and Equipment, Gross	81,990	78,490
Estimated useful lives	3-7 Years
Vehicle
Property, Plant and Equipment, Gross	$ 19,442	$ 19,442
Estimated useful lives	5 Years

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4. Inventory (Detail) (USD $)	Jun. 30, 2013	Dec. 31, 2012
Inventory Disclosure [Abstract]
Raw materials	$ 511,452	$ 515,451
Finished goods	556,994	415,176
Inventory, gross	1,068,446	930,627
Less: inventory reserve	(45,001)	(56,746)
Inventory	$ 1,023,445	$ 873,881

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9. Related Party Transactions and Operating Leases - Additional Information (Detail) (USD $)	6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Lease expiration date	Feb. 28, 2014
Monthly lease rental payments	$ 7,000
Lease rent expense	42,000	42,000
Minimum monthly order	5,880
Marketing fees included in selling and distribution expenses	53,000	136,000
Operating Leases From Third Party [Member]
Lease expiration date	May 31, 2015
Monthly lease rental payments	4,000
Lease rent expense	$ 24,000	$ 24,000

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7. Stockholders' Equity (Narrative) (USD $)	6 Months Ended
	Jun. 30, 2013
Disclosure Stockholders Equity Additional Information [Abstract]
Maximum number of awards which may be granted	5,000,000
Awards granted	2,900,000
Unamortized compensation expense	$ 206,000
Weighted average period of unamortizzed compensation expense	1 year 8 months 12 days

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3. Reconciliation of Numerators and Denominators of Basic and Diluted Earnings Per Share (Detail) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Disclosure Reconciliation Of Numerators and Denominators Of Basic and Diluted Earnings Per Share [Abstract]
Net income (loss) available to common shares	$ 308,901	$ (261,614)	$ 32,738	$ (253,019)
Basic:
Weighted average shares	62,588,856	62,388,856	62,488,856	62,388,856
Diluted:
Weighted average shares, basic	62,588,856	62,388,856	62,488,856	62,388,856
Dilutive effect of warrants and options	4,700,000	0	3,575,000	0
Weighted average shares, diluted	67,288,856	62,388,856	66,063,856	62,388,856
Basic earnings (loss) per share	$ 0.00	$ 0.00	$ 0.00	$ 0.00
Diluted earnings (loss) per share	$ 0.00	$ 0.00	$ 0.000	$ 0.00
Weighted average anti-dilutive shares excluded from diluted EPS		2,000,000		2,000,000

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1. Nature of Operations

6 Months Ended

Jun. 30, 2013

Nature Of Operations [Abstract]

Nature of Operations

Note 1.  Nature of Operations

Empowered Products, Inc. and Subsidiaries (the “Company”) is engaged in the manufacture, sale and distribution of personal care products, principally throughout the United States, Europe and Asia. All of its business has been categorized as one segment.

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3. Earnings (Loss) per Share

6 Months Ended

Jun. 30, 2013

Earnings (loss) per share:

Earnings (Loss) per Share ("EPS")

Note 3. Earnings (Loss) per Share (“EPS”)

Earnings (loss) per share are calculated in accordance with FASB ASC 260, Earnings Per Share.  Basic net earnings (loss) per share are based upon the weighted average number of common shares outstanding, but excluding shares issued as compensation that have not yet vested. Diluted net earnings (loss) per share are based on the assumption that all dilutive convertible shares and stock options were converted or exercised, and that all unvested shares have vested.  Dilution is computed by applying the treasury stock method. Under this method, options and warrants are assumed to be exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase common stock at the average market price during the period.

The following table illustrates the required disclosure of the reconciliation of the numerators and denominators of the basic and diluted earnings per share computations.

	Three Months Ended June 30,					Six Months Ended June 30,
	2013		2012			2013		2012
Net income (loss) available to common shares	$	308,901	$	(261,614	)	$	32,738	$	(253,019	)
Basic:
Weighted average shares		62,588,856		62,388,856			62,488,856		62,388,856
Diluted:
Weighted average shares, basic		62,588,856		62,388,856			62,488,856		62,388,856
Dilutive effect of warrants and options		4,700,000		–			3,575,000		–
Weighted average shares, diluted		67,288,856		62,388,856			66,063,856		62,388,856
Basic earnings (loss) per share	$	0.00	$	(0.00	)	$	0.00	$	(0.00	)
Diluted earnings (loss) per share	$	0.00	$	(0.00	)	$	0.00	$	(0.00	)
Weighted average anti-dilutive    shares excluded from diluted EPS		–		2,000,000			–		2,000,000

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6. Line of Credit

6 Months Ended

Jun. 30, 2013

Line of Credit Facility [Abstract]

Line of Credit

Note 6. Line of Credit

The Company has a $500,000 line of credit with a financial institution bearing interest at prime plus 1% (prime was 3.25% at June 30, 2013) and an interest rate floor of 5%, secured by restricted cash and a personal guarantee of the Company’s majority stockholder with a maturity date of November 1, 2013. The balance was $390,688 and $346,042 at June 30, 2013 and December 31, 2012, respectively.

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4. Inventory

6 Months Ended

Jun. 30, 2013

Inventory Disclosure [Abstract]

Inventory

Note 4. Inventory

Inventory consists of the following at:

	June 30,			December 31,
	2013			2012
Raw materials	$	511,452		$	515,451
Finished goods		556,994			415,176
		1,068,446			930,627
Less:  inventory reserve		(45,001	)		(56,746	)
	$	1,023,445		$	873,881

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5. Plant and Equipment, Net (Narrative) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Property, Plant and Equipment [Abstract]
Depreciation	$ 13,000	$ 17,000	$ 30,000	$ 33,000

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8. Revenue by Geographical Area (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Revenues	$ 1,325,926	$ 685,408	$ 2,158,945	$ 1,501,321
Revenues percentage	100.00%	100.00%	100.00%	100.00%
United States
Revenues	1,258,157	595,766	2,034,381	1,353,992
Revenues percentage	94.90%	86.90%	94.20%	90.20%
Europe
Revenues	43,832	48,371	82,141	85,934
Revenues percentage	3.30%	7.10%	3.80%	5.70%
Asia
Revenues	$ 23,937	$ 41,271	$ 42,423	$ 61,395
Revenues percentage	1.80%	6.00%	2.00%	4.10%

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Consolidated Condensed Balance Sheets (Parenthetical) (USD $)	Jun. 30, 2013	Dec. 31, 2012
Statement of Financial Position [Abstract]
Accounts receivable, allowance for doubtful accounts	$ 31,798	$ 33,271
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	2,200,000,000	2,200,000,000
Common stock, shares issued	62,588,856	62,388,856
Common stock, shares outstanding	62,588,856	62,388,856

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9. Related Party Transactions and Operating Leases

6 Months Ended

Jun. 30, 2013

Related Party Transactions [Abstract]

Related Party Transactions and Operating Leases

Note 9. Related Party Transactions and Operating Leases

The Company rents office space from an affiliate, EGA Research, LLC,that is controlled by the Company’s majority stockholder under a triple net lease expiring on February 28, 2014. The lease calls for monthly rental payments of $7,000. Total rent expense for each of the six months ended June 30, 2013 and 2012 was $42,000.

The Company entered into an office lease with an unrelated party for additional rental space in 2011 which expired on May 31, 2013 and was renewed through May 31, 2015. The lease calls for monthly rental payments of $4,000. The Company has an option to purchase the building for its fair value at any time during the term of the lease. Total rent expense under this lease for the six months ended June 30, 2013 and 2012 was $24,000 and $24,000, respectively.

Included in selling and distribution expenses for the six months ended June 30, 2013 and 2012 are marketing fees of approximately $53,000 and $136,000 respectively, paid to a company owned by the Company’s majority stockholder.

Minimum future rentals under the lease agreements are as follows:

Year ending
2013	$	66,000
2014		62,000
2015		20,000
	$	148,000

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Consolidated Condensed Statements of Cash Flows (USD $)	6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Cash flows from operating activities:
Net income (loss)	$ 32,738	$ (253,019)
Adjustments to reconcile net income (loss) to cash flows used in operating activities:
Depreciation and amortization	35,450	34,461
Share based compensation	334,135	0
Provision for doubtful accounts	12,379	0
Changes in assets and liabilities:
Restricted cash	(210)	0
Accounts receivable	(699,126)	28,156
Inventory	(149,564)	(267,882)
Prepaid and other current assets	(14,542)	43,645
Other assets	(28,244)	3,378
Accounts payable and other accrued expenses	176,053	(184,563)
Deferred revenue	282,881	0
Cash flows used in operating activities	(18,050)	(595,824)
Cash flows from investing activities:
Purchase of plant and equipment	(3,500)	(8,198)
Payment of fees for trademarks	(4,320)	(4,407)
Cash flows used in investing activities	(7,820)	(12,605)
Cash flows from financing activities:
Line of credit advances (repayments), net	44,646	(8,739)
Cash flows provided by (used in) financing activities	44,646	(8,739)
Net increase (decrease) in cash and cash equivalents	18,776	(617,168)
Cash and cash equivalents at the beginning of the period	116,990	863,766
Cash and cash equivalents at the end of the period	135,766	246,598
Supplementary disclosure of cash flow information:
Cash paid for interest	$ 8,189	$ 11,320

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Consolidated Condensed Balance Sheets (USD $)	Jun. 30, 2013	Dec. 31, 2012
Current Assets:
Cash and cash equivalents	$ 135,766	$ 116,990
Restricted cash	561,740	561,530
Accounts receivable, less allowance for doubtful accounts of $45,866 and $33,271 respectively	1,043,786	357,039
Inventory, net	1,023,445	873,881
Prepaid and other current assets	79,649	65,107
Total current assets	2,844,386	1,974,547
Plant and equipment, net	203,369	229,769
Trademarks and other intangibles, net	540,972	542,202
Other assets	62,850	34,606
Total assets	3,651,577	2,781,124
Current Liabilities:
Line of credit	390,688	346,042
Accounts payable and other accrued expenses	300,767	124,714
Deferred revenue	282,881	0
Total current liabilities	974,336	470,756
Commitments and contingencies
Stockholders' Equity:
Preferred stock, $.001 par value, 5,000,000 shares authorized, no shares issued and outstanding	0	0
Common stock, $.001 par value, 2,200,000,000 shares authorized, 62,588,856 and 62,388,856 shares issued and outstanding at June 30, 2013 and December 31, 2012, respectively	62,589	62,389
Additional paid-in capital	6,423,834	6,089,899
Accumulated deficit	(3,809,182)	(3,841,920)
Total stockholders' equity	2,677,241	2,310,368
Total liabilities and stockholders' equity	$ 3,651,577	$ 2,781,124

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6. Line of Credit (Narrative) (USD $)	6 Months Ended
	Jun. 30, 2013	Dec. 31, 2012
Disclosure Line Of Credit Additional Information [Abstract]
Line of credit, borrowing capacity	$ 500,000
Line of credit maturity date	Nov. 01, 2013
Line of credit	$ 390,688	$ 346,042

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9. Related Party Transactions and Operating Leases (Tables)

6 Months Ended

Jun. 30, 2013

Related Party Transactions [Abstract]

Minimum Future Rentals Under The Lease Agreements

Year ending
2013	$	66,000
2014		62,000
2015		20,000
	$	148,000

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10. Income Taxes (Narrative) (USD $)	6 Months Ended	12 Months Ended
	Jun. 30, 2013	Dec. 31, 2012
Disclosure Income Taxes Additional Information [Abstract]
Net operating loss carryforwards	$ 3,143,000	$ 3,570,000
Federal operating loss carryforwards expiration dates	2024
Statutory federal income tax rate	34.00%	34.00%
Decrease in deferred tax assets valuation allowance	$ (145,000)

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8. Revenue by Geographic Area

6 Months Ended

Jun. 30, 2013

Geographic Areas, Revenues from External Customers [Abstract]

Revenue by Geographic Area

Note 8. Revenue by Geographic Area

Revenues by geographic area are determined based on the location of the Company’s customers. The following provides financial information concerning the Company’s operations by geographic area for the three and six months ended June 30:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2013			2012			2013			2012
Revenue:
United States	$	1,258,157	94.9%	$	595,766	86.9%	$	2,034,381	94.2%	$	1,353,992	90.2%
Europe		43,832	3.3%		48,371	7.1%		82,141	3.8%		85,934	5.7%
Asia		23,937	1.8%		41,271	6.0%		42,423	2.0%		61,395	4.1%
	$	1,325,926	100%	$	685,408	100%	$	2,158,945	100%	$	1,501,321	100.0%

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7. Summary of activity related to stock options (Detail) (USD $)	6 Months Ended
	Jun. 30, 2013
Shares
Shares, Beginning	0
Shares, Granted	2,700,000
Shares, Exercised	0
Shares, Forfeited	0
Shares, Expired	0
Shares, Ending	2,700,000
Shares, Fully vested and expected to vest	1,566,669
Shares, Exercisable	1,566,669
Weighted Average Exercise Price
Weighted Average Exercise Price, Beginnig	$ 0
Weighted Average Exercise Price, Granted	$ 0.28
Weighted Average Exercise Price, Exercised	$ 0
Weighted Average Exercise Price, Forfeited	$ 0
Weighted Average Exercise Price, Expired	$ 0
Weighted Average Exercise Price, Ending	$ 0.28
Weighted Average Exercise Price, Fully vested and expected to vest	$ 0.28
Weighted Average Exercise Price, Exercisable	$ 0.28
Weighted Average Remaining Contractual Term
Weighted Average Remaining Contractual Term, Outstanding	9 years 8 months 12 days
Weighted average remaining contractual term, Fully vested and expected to vest	9 years 8 months 12 days
Weighted average remaining contractual term, Exercisable	9 years 8 months 12 days
Aggregate Intrinsic Value
Aggregate Instrinsic Value, Outstanding	$ 135,000
Aggregate Instrinsic Value, Fully vested and expected to vest	78,333
Aggregate Instrinsic Value, Exercisable	$ 78,333

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11. Subsequent Events

6 Months Ended

Jun. 30, 2013

Subsequent Events [Abstract]

Subsequent Events

Note 11. Subsequent Events

In July 2013, the Company entered into Service Agreements with two companies agreeing to issue five-year warrants to purchase an aggregate of three million shares of the Company’s common stock for services to be rendered. Of the issuable warrants, warrants equivalent to one million shares were issued on July 29, 2013, warrants to purchase one million shares will be issued in July 2014, and warrants to purchase one million shares will be issued in July 2015. If the Service Agreements are terminated prior to the issuance date, the Company has no obligation to issue the remaining unissued warrants.

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7. Stockholders' Equity

6 Months Ended

Jun. 30, 2013

Stockholders' Equity:

Stockholders' Equity

Note 7. Stockholders’ Equity

On June 30, 2011, the Company entered into a subscription agreement with New Kaiser Limited (the “Investor”) to sell an aggregate of 2,000,000 shares of common stock for $1.00 per share. In connection with the shares being issued, the Investor received five-year warrants which allow the Investor to purchase 2,000,000 shares of its common stock at an exercise price of $1.25 per share.

On February 22, 2013, the Company entered into an agreement with a related party, whereby, the Company agreed to grant to the individual as partial consideration of services to be rendered to the Company and/or its subsidiaries, an aggregate of 400,000 shares of the Company’s common stock, pursuant to the Company’s stock incentive plan below, to be granted in equal installments of 200,000 shares on April 1, 2013 and October 1, 2013, respectively. The Company valued these shares at $56,000 based on the Company’s stock price at the date of the grant.

Share-Based Compensation

In April 2012, the Board of Directors adopted and the shareholders approved the Empowered Products, Inc. 2012 Omnibus Incentive Plan (the “Plan”). The Plan provides for the grant of stock options, stock appreciation rights (none issued), restricted stock, and other stock awards, including short-term cash incentive awards (none issued). In addition, the Plan provides for the grant of restricted stock units of which none are currently issued. Awards granted under the Plan may be granted individually or in any combination. Stock options may not be granted at an exercise price less than the market value of our common stock on the date of grant and may be subsequently re-priced by the Plan Administrator without stockholder consent. Equity granted under the Plan vests in various increments generally over one to three years and stock options expire in ten years.

The Plan provides for grants of awards to our directors, employees and consultants. The maximum number of awards which may be granted is 5.0 million of which 2.9 million have been granted as of June 30, 2013.

On March 12, 2013, the Board of Directors adopted resolutions and granted non-qualified stock options to five of the Company’s employees pursuant to the Plan. A summary of activity related to stock options is presented below:

	Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value
Outstanding at December 31, 2012		–	$	–		–	$	–
Granted		2,700,000		0.28
Exercised		–		–
Forfeited		–		–
Expired		–		–
Outstanding at June 30, 2013		2,700,000	$	0.28		9.7	$	135,000
Fully vested and expected to vest at June 30, 2013		1,566,669	$	0.28		9.7	$	78,333
Exercisable at June 30, 2013		1,566,669	$	0.28		9.7	$	78,333

For the six months ended June 30, 2013, 2.7 million non-qualified stock options were granted with an aggregate fair market value of approximately $484,000. For the six months ended June 30, 2013, no stock options were exercised; therefore, the tax effect/benefit from stock option exercises had no effect on our additional paid-in capital or income tax provision. As of June 30, 2013, there was approximately $206,000 of unamortized compensation expense related to stock options that is expected to be recognized as an expense over a weighted average period of 1.7 years.

Option valuation models require the input of certain assumptions and changes in assumptions used can materially affect the fair value estimate. The options have been valued using the Black-Scholes pricing model with assumptions of a five to five and a half year term, common stock price of $0.28 per share, 78% expected volatility, 0.88% risk-free interest rate and a dividend yield of 0%. Expected volatility was based on average volatilities of a sampling of four companies with similar attributes to the Company as the Company has a limited trading history. The risk free rate for the contractual life of the warrants was based on the U.S. Treasury yield at the time of grant.

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2. Basis of Presentation and Accounting Policies

6 Months Ended

Jun. 30, 2013

Accounting Policies [Abstract]

Basis of Presentation and Accounting Policies

Note 2. Basis of Presentation and Accounting Policies

The accompanying unaudited consolidated condensed financial statements have been prepared in accordance with the instructions from Form 10-Q pursuant to the rules and regulations of the Securities and Exchange Commission and, therefore, do not include all information and notes normally provided in the audited financial statements and should be read in conjunction with the Company’s audited financial statements for fiscal year ended December 31, 2012 filed with the United States Securities and Exchange Commission on April 1, 2013. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for the full year.

The accompanying unaudited consolidated condensed balance sheets, statements of operations and cash flows reflect all adjustments, consisting of normal recurring adjustments that are, in the opinion of management, necessary for a fair presentation of the financial position of the Company at June 30, 2013 and the results of operations and cash flows for the three and six months ended June 30, 2013 and 2012.

Going concern

As of June 30, 2013, the Company has cash and cash equivalents of approximately $136,000 and an accumulated deficit of approximately $3,809,000. Although the Company generated net income of approximately $309,000 for the three months ended June 30, 2013, based on the current cash position and anticipated cash requirements for the Company to meet its growth targets, additional capital will be required. The Company has managed to generate revenues since inception, however, there is no assurance that the Company will be able to obtain additional debt or equity financing, which raises substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Consolidation

The consolidated condensed financial statements include the accounts of Empowered Products, Inc. and its direct and indirect wholly-owned subsidiaries, Empowered Products Nevada, Inc., Empowered Products Limited, Empowered Products Asia Limited, and Empowered Products Pty Ltd. All material intercompany balances have been eliminated in consolidation.

Revenue recognition

Revenue is recognized when all significant contractual obligations, which involve the shipment of the products sold and reasonable assurance as to the collectability of the resulting account receivable has been satisfied. Returns are permitted primarily due to damaged or unsalable items. Revenue is shown after deductions for prompt payment, volume discounts and returns. The Company participates in various promotional activities in conjunction with its retailers and distributors, primarily through the use of discounts. These costs have been subtracted from revenue and for the six months ended June 30, 2013 and 2012 approximated $8,000 and $18,000, respectively, and approximately $4,500 and $7,300 for the three months ended June 30, 2013 and 2012, respectively. The allowances for sales returns are established based on the Company’s estimate of the amounts necessary to settle future and existing obligations for such items on products sold as of the balance sheet date. The Company records deferred revenue when cash is received or goods are shipped in advance of the revenue recognition criteria being met.

Cost of revenue

Cost of revenue includes the cost of raw materials, packaging, inbound freight, direct labor, manufacturing facility costs, and depreciation. Other overhead costs, including purchasing, receiving, quality control, and warehousing are classified as selling and distribution or general and administrative expenses.

At times the Company provides free products to its customers. These free products are accounted for in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 605-50 Revenue Recognition-Customer Payments and Incentives and the cost of the product is recognized in cost of revenue.

Use of estimates

Management uses estimates and assumptions in preparing these financial statements in accordance with accounting principles generally accepted in the United States of America. Those estimates and assumptions affect the reported amounts of assets and liabilities and the reported revenues and expenses. Such estimates primarily relate to the collectability of accounts receivable, provision for sales returns and allowances, inventory obsolescence, useful life of plant and equipment and the valuation of warrants and stock options. Actual results could vary from the estimates that were used.

Fair value of financial instruments

The Company’s financial instruments are cash and cash equivalents, restricted cash, accounts receivable, line of credit, and accounts payable. The recorded values of cash and cash equivalents, restricted cash, accounts receivable, line of credit and accounts payable approximate their fair values based on their short-term nature.

Restricted cash

Included in restricted cash is a certificate of deposit securing the Company’s line of credit.

Accounts receivable

Accounts receivable are carried at the outstanding amount due less an allowance for doubtful accounts, if an allowance is deemed necessary. Allowance for doubtful accounts are established when there is a basis to doubt the full collectability of the accounts receivable. On a periodic basis, the Company evaluates its accounts receivable and determines the requirement for an allowance, based on its history of past write-offs, collections and current conditions. When an account receivable is ultimately determined to be uncollectible and due diligence for collection has taken place, the account receivable is written-off.

Inventory

Inventory consists primarily of raw materials and finished goods that the Company holds for sale in the ordinary course of business. Inventory is stated at the lower of cost (determined on the first-in, first-out basis) or market. Other manufacturing overhead costs are also allocated to finished goods inventory. The amount of these allocations to inventory was approximately $130,000 at June 30, 2013 and $111,000 at December 31, 2012, respectively. Management periodically evaluates the composition of inventory and estimates an allowance to reduce inventory for slow moving, obsolete or damaged inventory. An allowance of approximately $45,000 and $57,000 was recorded at June 30, 2013 and December 31, 2012, respectively.

Trademarks and other intangibles, net

The Company capitalizes fees in connection with the development of various product trademarks. These assets are considered indefinite lived intangible assets and are reviewed for impairment annually or when circumstances indicate that the carrying amount of the trademark may not be fully recoverable. The amount attributable to trademarks at June 30, 2013 and December 31, 2012 was approximately $521,000 and $516,000, respectively. An impairment loss would be recorded if the carrying amount of the indefinite lived intangible asset exceeds its estimated fair value. The Company performed an impairment test as of December 31, 2012 and concluded that based on its undiscounted cash flows, the related trademarks were not impaired.

Share-based compensation

The Company uses the fair value method of accounting for share-based compensation arrangements. The fair value of stock options is estimated at the date of grant using the Black-Scholes option valuation model. Stock-based compensation expense is reduced for estimated forfeitures and is amortized over the vesting period using the straight-line method.

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9. Minimum Future Rentals under Lease Agreements (Detail) (USD $)	Jun. 30, 2013
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract]
2013	$ 66,000
2014	62,000
2015	20,000
Operating leases future minimum payments due	$ 148,000

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4. Inventory (Tables)

6 Months Ended

Jun. 30, 2013

Inventory Disclosure [Abstract]

Inventory

	June 30,			December 31,
	2013			2012
Raw materials	$	511,452		$	515,451
Finished goods		556,994			415,176
		1,068,446			930,627
Less:  inventory reserve		(45,001	)		(56,746	)
	$	1,023,445		$	873,881

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10. Income Taxes

6 Months Ended

Jun. 30, 2013

Income Taxes [Abstract]

Income Taxes

Note 10. Income Taxes

Income taxes are calculated using the asset and liability method of accounting. Deferred income taxes are computed by multiplying statutory rates applicable to estimated future year differences between the financial statement and tax basis carrying amounts of assets and liabilities.

The Company has federal net operating loss (“NOL”) carry forwards of $3,143,000 and $3,570,000 at June 30, 2013 and December 31, 2012, respectively. The federal net operating loss carry forwards begin to expire in 2024. A 34% statutory federal income tax rate was used for the calculation of the deferred tax asset. Management has established a valuation allowance equal to the estimated deferred tax asset due to uncertainties related to the ability to realize these tax assets. The valuation allowance decreased by approximately $145,000 during the six months ended June 30, 2013.

The NOL carry forwards may be significantly limited under Section 382 of the Internal Revenue Code (“IRC”) as a result of the Company’s merger on June 30, 2011. The limitation imposed by Section 382 would place an annual limitation on the amount of the NOL carry forwards that can be utilized. The Company has not performed any analysis of whether or not there has been a cumulative change in ownership of greater than 50%. If this analysis were completed and it was determined that there has been a change in ownership, the amount of the NOL carry forwards available may be reduced significantly. However, since the valuation allowance fully reserves for all available carry forwards, the effect of the reduction would be offset by a reduction in the valuation allowance. Thus, the resolution of this matter would have no effect on the reported assets, liabilities, revenues, and expenses for the periods presented.

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8. Revenue by Geographic Area (Tables)

6 Months Ended

Jun. 30, 2013

Geographic Areas, Revenues from External Customers [Abstract]

Financial Information Concerning Operations by Geographic Area

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2013			2012			2013			2012
Revenue:
United States	$	1,258,157	94.9%	$	595,766	86.9%	$	2,034,381	94.2%	$	1,353,992	90.2%
Europe		43,832	3.3%		48,371	7.1%		82,141	3.8%		85,934	5.7%
Asia		23,937	1.8%		41,271	6.0%		42,423	2.0%		61,395	4.1%
	$	1,325,926	100%	$	685,408	100%	$	2,158,945	100%	$	1,501,321	100.0%

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5. Plant and Equipment, net (Tables)

6 Months Ended

Jun. 30, 2013

Property, Plant and Equipment [Abstract]

Cost, Accumulated Depreciation and Estimated Useful Lives

	Estimated	June 30,			December 31,
Category	Useful Lives	2013			2012
Manufacturing and computer equipment	5 - 7 Years	$	381,618		$	381,618
Office furniture and computer software	3 - 7 Years		81,990			78,490
Vehicle	5 Years		19,442			19,442
			483,050			479,550
Less:  accumulated depreciation			(279,681	)		(249,781	)
		$	203,369		$	229,769

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Document and Entity Information	6 Months Ended
	Jun. 30, 2013	Aug. 13, 2013
Document Documentand Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2013
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q2
Trading Symbol	EMPO
Entity Registrant Name	Empowered Products, Inc.
Entity Central Index Key	0001483935
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Entity Common Stock Shares Outstanding		62,588,856

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7. Share-Based Compensation (Tables)

6 Months Ended

Jun. 30, 2013

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock Options Activity

	Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value
Outstanding at December 31, 2012		–	$	–		–	$	–
Granted		2,700,000		0.28
Exercised		–		–
Forfeited		–		–
Expired		–		–
Outstanding at June 30, 2013		2,700,000	$	0.28		9.7	$	135,000
Fully vested and expected to vest at June 30, 2013		1,566,669	$	0.28		9.7	$	78,333
Exercisable at June 30, 2013		1,566,669	$	0.28		9.7	$	78,333