UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
☒
| [X] | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended December 31, 20162020
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
or
| [ ] | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from ____________ to ____________
Commission file number 0-53259001-38523
POWERDYNE INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
| Delaware | 20-5572576 | |
State or | ||
incorporation or | ||
| I.R.S. Employer Identification No. |
45 North Main Street North Reading, Massachusetts 40299 | 01864 | |
| (Address of | (Zip Code) |
(401) 739-3300
(Registrant'sRegistrant’s telephone number, including area code)code: (401) 739-3300
Securities registered pursuant to Section 12(b) of the Act: None
Name of each exchange on which registered: None
Securities registered pursuant to Section 12(g) of the Exchange Act: None
Common Stock, $.0001 par value per share
(Title of class)
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. ☐ Yes ☒[ ] No [X]
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. ☐ Yes ☒[ ] No [X]
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 Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section (§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 ☐[X] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (Section 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ☐ Yes
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company, or an emerging growth company. See the definitions of "large“large accelerated filer", "accelerated filer", "non-accelerated filer",filer,” “accelerated filer,” “smaller reporting company,” and "smaller reporting company"“emerging growth company” in Rule 12b-2 of the Exchange Act.Act .
| Large | Accelerated filer [ ] | |||
| Non-accelerated filer [X] | ||||
| [X] | ||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. [ ]
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
As of December 31, 2020, the aggregate market value of the registrant’s voting and non-voting common equitystock held by non-affiliates as of June 30, 2016, the last day of the registrant was $94,403. The registrant’s recently completed second quarter,stock does not trade. Therefore, the market value for the stock was approximately $244,019.00, based uponvalued at $0.0001, its par value. The registrant has no non-voting stock.
As of March 30, the average bid and asked price of such common equity on that date.
Indicate the number ofregistrant had 1,914,930,584 shares outstanding of each of the registrant's classes of common stock as of the latest practicable date.outstanding.
Documents incorporated by reference: None.
DOCUMENTS INCORPORATED BY REFERENCE
None
POWERDYNE INTERNATIONAL, INC.
FORM 10-K
TABLE OF CONTENTS
PART IFORWARD-LOOKING STATEMENTS
Special Note Regarding Forward-Looking Statements
This Annual Report on Form 10-K (this “Annual Report”)Registration Statement contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that involve substantial risks and uncertainties. All statements, other than statements of historical fact, contained in this Registration Statement, including statements regarding our strategy, future operations, future financial position, future revenues, projected costs, prospects, plans and objectives of management, are forward-looking statements. The forward-looking statements are contained principally in Part I, Item 1. “Business,words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “target,” “potential,” “will,” “would,” “could,” “should,” “continue,” and Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” butsimilar expressions are also contained elsewhere in this Annual Report. In some cases you canintended to identify forward-looking statements, by terminology such as “may,” “should,” “potential,” “continue,” “expects,” “anticipates,” “intends,” “plans,” “believes,” “estimates,”although not all forward-looking statements contain these identifying words.
We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements, and similar expressions. These statements are basedyou should not place undue reliance on our current beliefs,forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations and assumptions and are subject to a number of risks and uncertainties, many of which are difficult to predict and generally beyond our control,disclosed in the forward-looking statements we make. We have included important cautionary statements in this Registration Statement, particularly in the “Risk Factors” section, that we believe could cause actual results or events to differ materially from those expressed, projected or implied in or by the forward-looking statements. There are other factors that may cause our actual results to differ materially from those expressed or implied by our forward-looking statements. As a result of these factors, we cannot assure you that the forward-looking statements that we make. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments we may make.
You should read this Registration Statement and the documents that we have filed as exhibits to this Registration Statement with the understanding that our actual future results may be materially different from what we expect. The forward-looking statements contained in this Annual Report will prove to be accurate. Furthermore, if our forward-looking statements prove to be inaccurate, the inaccuracy may be material. In lightRegistration Statement are made as of the significant uncertainties in these forward-looking statements, you should not regard these statements as a representation or warranty by us or any other person thatdate of this Registration Statement, and we will achieve our objectives and plans in any specified time frame, or at all. We do not undertakeassume any obligation to update any forward-looking statements.statements except as required by applicable law.
WHERE YOU CAN FIND MORE INFORMATION ABOUT US
UnlessWhen this Registration Statement becomes effective, we will begin to file reports, proxy statements, information statements and other information with the context requires otherwise, referencesUnited States Securities and Exchange Commission, or SEC. You may read and copy this information, for a copying fee, at the SEC’s Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for more information on its Public Reference Room. Our SEC filings will also be available to “we,” “us,” “our,”the public from commercial document retrieval services, and “Powerdyne,” referat the website maintained by the SEC at http://www.sec.gov.
Our Internet website address is http://www.powerdyneinternational.com. Information contained on the website does not constitute part of this Registration Statement. We have included our website address in this Registration Statement solely as an inactive textual reference. When this Registration Statement is effective, we will make available, through a link to Powerdyne International, Inc.the SEC’s website, electronic copies of the materials we file with the SEC, including annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, the Section 16 reports filed by our executive officers, directors and 10% stockholders and amendments to those reports.
| 3 |
ITEM 1.1: DESCRIPTION OF BUSINESS
Overview
We are a company which provides independent, cost-effective, green electrical power through the leasing of electrical generation equipment under the trade name “PDI Power Solutions”. On March 11 2015, we entered into one agreement for the leasing of our equipment that has generated $1,240 in revenue to date. Our PDI Power Solution is a customized green power solution which allows a client to operate either independent of the grid (forming his own micro-grid) with the option for cogeneration (CHPC) or to operate while allowing the grid to act as a UPS System (uninterruptable power supply) if he chooses. Each PDI Power Solution is customized to meet our individual client’s unique power requirements. This is accomplished by using a modular design approach for the integration of all the components which make up each system. A typical PDI Power Solution is made up of a generator (gaseous), system controller (which allows for remote diagnostics, monitoring and control of a parallel generator system), a modified cooling system, an optional heat exchanger or chiller all packaged in either a weather proof/sound attenuated enclosure. Cogeneration capability CHPC (combination heat/power/cooling) is achieved by adding a closed loop cooling system to the generatorswith the addition of a heat exchanger and/or chiller. The heat exchanger produces hot water which can be used for heating and/or for preheating water. The chillers provide cooling to support air conditioning or refrigeration needs. PDI Power Solutions are intended to be either stationary or portable power systems ready for rapid global deployment taking only a few hours for installation. These systems can be packaged into modules which will provide as much as 100 megawatts of power.
We intend to acquire all the components needed to make a PDI Power Solution and either have them installed at the generator manufacturer’s facility to our specifications or integrated at the client’s site. We have developed strategic alliances with both our generator manufacturer and installation contractor to allow assembly of the system’s component parts either at the manufacturer’s or client’s facility.
Our potential customers include a variety of small to medium size manufacturing companies, hotels and commercial enterprises worldwide. In addition our power solutions are ideal for large end users such as seaports, commercial laundries, airports and the like. However, we initially intend to focus our marketing and sales efforts in the Caribbean and California markets, where we believe there is a great need for independent cost effective reliable power. The equipment lease that we recently entered into is for the leasing of a PDI Power Solutions in Puerto Rico. Once established in the Caribbean and California, we intend to expand our marketing throughout North America and as we move into other regions in North America we plan to increase the power ratings of the PDI Power Solutions to include multi-megawatt power generating systems.
On March 11, 2015, we entered into our first equipment lease with Farmacia Brisas del Mar, a Puerto Rican corporation (the “Lessee”); the agreement is for a term of five years. The custom designed system will also be able to provide cogeneration capabilities with the addition of chillers to support the customer’s air conditioning needs. The agreement provides for a payment to us of a monthly fee equal to the greater of a set monthly base rate or a monthly base rate plus an additional amount based on kilowatt wattage. The agreement provides for termination only in the event of nonperformance by us unless Lessee pays all payments due for the remainder of the term. The agreement contains representation and warranties, default provisions and indemnification provisions typical for agreements of this type. In 2016 the terms on the Farmacia Del Mar lease was modified to a monthly payment, based on actual power consumption.
We have a brief history in our current line of business and have experienced losses since our inception. As shown in the financial statements, we have incurred an accumulated deficit of $3,374,003 from inception to December 31, 2016 and our independent registered public accounting firm has issued language in their audit report raising substantial doubt about our ability to continue as a going concern.
Products
Our product (PDI Power Solution) is a self-contained generator powered by a gaseous fueled engine which drives an electrical generator. The unit runs on natural gas, propane or other gaseous fuels; it is compact, lightweight and clean burning. As a result, the units produce low emissions and are energy-efficient.
The basis of our overall business is founded on the ability to produce electrical power using state-of-the-art technology to produce electricity at a lower cost than the existing means of producing or providing primary electric power (Spark Price: the difference between the cost of electricity provided by the utility company and the cost of electricity produced by a PDI Power Solution), in its target markets. We expect that the difference between our cost to produce electrical power and the current billing rate of existing local utility providers will present savings for our customers and a continual revenue stream for us.
The basic PDI Power Solution consists of three active components; a generator, system controller, and paralleling switch gear all mounted onto a common skid. The controller, switch gear and skid are all commercially available from multiple manufacturers built to our specifications. They are custom built to meet both our specifications as well as the customer’s specific power requirements. The PDI Power Solution can also have the option of having cogeneration capabilities of producing a combined heat power and cooling by adding custom integrated chillers and heat exchangers. These components once assembled onto the skid, can be put inside a weather and sound attenuated enclosure for stationary application or slid into a container and then mounted on a set of wheels for mobile and rapid deployment. The modular design approach allows for interchangeable components which allows for any component to be switched out as newer more cost effective technology becomes available. We believe this gives us the competitive advantage of upgrading a PDI Power Solution with new technology at the customer’s facility without replacing the entire system.
Business Model
We plan to develop our business, producing and distributing primary electrical power and cogeneration CHCP capabilities through the PDI Power Solution product offerings, under long term master lease agreements, similar to the one we signed with Farmacia Brisas del Mar, at fixed capacity charge plus a usage charge based on actual power used at a fixed dollars per kilowatt hour ($/kWh). Installation, service and maintenance of the PDI Power Solution are initially being provided through independent contractors, at no cost to the customer.
We intend to provide a viable alternative for local utilities to reduce the demand on the primary grid by using our equipment and power, thereby increasing the limits and capabilities of the primary grid. By using our equipment, we expect that the customer will be able to solve several problems at once. First, expensive and polluting diesel units are replaced with cost-efficient, greener gensets. Second, the customer’s cost to produce the electrical power is reduced. Third, savings go directly to the bottom line on a monthly basis, no need to apply for energy credit annually. Fourth, maintenance is provided exclusively by us, thereby allowing the customer to reduce its workforce. Fifth, any tank farms and all other diesel support equipment or infrastructure can be dismantled and removed from the customer’s site.
Our History
Our company was incorporated in the State of Delaware in September 2006 and was formerly known as Greenmark Acquisition Corporation (“Greenmark”). On February 7, 2011, Greenmark Acquisition Corporation and Powerdyne, Inc., a Nevada corporation (“Powerdyne Nevada”), merged with Greenmark as the surviving company. Powerdyne Nevada was formed in February 2010 in the State of Nevada and had limited operations until the time of its combination described above.with Greenmark. As part of the merger, Greenmark Acquisition Corporation, the surviving entity, changed its name to Powerdyne International, Inc. Prior to the merger, Greenmark did not have any ongoing business or operations and was established for the purpose of completing mergers and acquisitions with a target company, such as Powerdyne Nevada.
Overview
We are a company which intends to provide independent, cost-effective, green electrical power through the leasing of electrical generation equipment under the trade name “PDI Power Solutions”. Our PDI Power Solution is a customized green power solution which allows a client to operate either independent of the grid (forming his own micro-grid) with the option for cogeneration (CHPC) or to operate while allowing the grid to act as a UPS System (uninterruptable power supply) if he chooses. Each PDI Power Solution will be customized to meet our individual client’s unique power requirements. This is accomplished by using a modular design approach for the integration of all the components which make up each system. A typical PDI Power Solution is made up of a generator (gaseous), system controller (which allows for remote diagnostics, monitoring and control of a parallel generator system), a modified cooling system, an optional heat exchanger or chiller all packaged in a weatherproof/sound attenuated enclosure. Cogeneration capability CHPC (combination heat/power/cooling) is achieved by adding a closed loop cooling system to the generators with the addition of a heat exchanger and/or chiller. The heat exchanger produces hot water which can be used for heating and/or for preheating water. The chillers provide cooling to support air conditioning or refrigeration needs. PDI Power Solutions are intended to be either stationary or portable power systems ready for rapid global deployment taking only a few hours for installation. These systems can be packaged into modules which will provide as much as 100 megawatts of power.
We intend to acquire all the components needed to make a PDI Power Solution and either have them installed at the generator manufacturer’s facility to our specifications or integrated at the client’s site.
Our potential customers include a variety of small to medium size manufacturing companies, hotels and commercial enterprises worldwide. In addition, our power solutions are ideal for large end users such as seaports, commercial laundries, airports and the like. However, we initially intend to focus our marketing and sales efforts in the Caribbean and California markets, where we believe there is a great need for independent cost-effective reliable power. Once established in the Caribbean and California, we intend to expand our marketing throughout North America and as we move into other regions in North America, we plan to increase the power ratings of the PDI Power Solutions to include multi-megawatt power generating systems.
During the quarter ended March 31, 2019 Powerdyne International, Inc. purchased several crypto currency miners and began mining certain crypto coins. This was done in an effort to enter into the crypto markets and explore other potential revenue opportunities for Powerdyne International, Inc.
We have not installed and activated any of our power equipment to date. Our primary activities have been in perfecting our concept and in marketing and sales of our products. As shown in our financial statements, we have incurred an accumulated deficit of $3,608,056 from inception thru December 31, 2020.
Products
Our product (PDI Power Solution) is a self-contained generator powered by a gaseous fueled engine which drives an electrical generator. The unit runs on natural gas, propane, or other gaseous fuels; it is compact, lightweight, and clean burning. As a result, the units produce low emissions and are energy efficient.
The basis of our overall business is founded on the ability to produce electrical power using state-of-the-art technology to produce electricity at a lower cost than the existing means of producing or providing primary electric power (Spark Price: the difference between the cost of electricity provided by the utility company and the cost of electricity produced by a PDI Power Solution), in its target markets. We expect that the difference between our cost to produce electrical power and the current billing rate of existing local utility providers will present savings for our customers and a continual revenue stream for us.
The basic PDI Power Solution consists of three active components; a generator, system controller, and paralleling switch gear all mounted onto a common skid. The controller, switch gear and skid are all commercially available from multiple manufacturers built to our specifications. They are custom built to meet both our specifications as well as the customer’s specific power requirements. The PDI Power Solution can also have the option of having cogeneration capabilities of producing a combined heat power and cooling by adding custom integrated chillers and heat exchangers. These components once assembled onto the skid, can be put inside a weather and sound attenuated enclosure for stationary application or slid into a container and then mounted on a set of wheels for mobile and rapid deployment. The modular design approach allows for interchangeable components which allows for any component to be switched out as newer more cost-effective technology becomes available. We believe this gives us the competitive advantage of upgrading a PDI Power Solution with new technology at the customer’s facility without replacing the entire system.
Business Model
We plan to develop our business, producing and distributing primary electrical power and cogeneration CHCP capabilities through the PDI Power Solution product offerings, under long term master lease agreements, similar to the one we signed with Farmacia Brisas del Mar, at fixed capacity charge plus a usage charge based on actual power used at a fixed dollars per kilowatt hour ($/kWh). Installation, service and maintenance of the PDI Power Solution will initially be provided through independent contractors, at no cost to the customer.
We intend to provide a viable alternative for local utilities to reduce the demand on the primary grid by using our equipment and power, thereby increasing the limits and capabilities of the primary grid. By using our equipment, we expect that the customer will be able to solve several problems at once. First, expensive, and polluting diesel units are replaced with cost-efficient, greener gensets. Second, the customer’s cost to produce the electrical power is reduced. Third, savings go directly to the bottom line on a monthly basis, no need to apply for energy credit annually. Fourth, maintenance is provided exclusively by us, thereby allowing the customer to reduce its workforce. Fifth, any tank farms and all other diesel support equipment or infrastructure can be dismantled and removed from the customer’s site.
Some generators are readily available, and some would be made to the customer’s specific needs, using the latest technology such as remote monitoring, remote auto shut down. Typical generator manufactures such as Cummings, Caterpillar, or GE for example will package their power solutions to meet the customer’s specifications using only their own equipment in standard packages. Powerdyne will review both the customer’s power requirements in addition to their budget, schedule, and expectations. Once this has been done Powerdyne will select the best equipment from all global equipment manufactures available and custom packaging this equipment into a power solution that offers a high efficiency green power solution that meets the customer’s budget, schedule, power specifications and expectations.
The Market
Our market is global, and our primary focus is on placing PDI Power Solutions in manufacturing and commercial operations, as well as any other existing independent power generation application that requires high quality, steady electrical power generation. We intend to lease our units based on usage to allow customers to generate electricity on a 24/7 basis. The PDI Power Solution is ideal for any medium to large commercial user wherein electricity can be delivered to the user’s location on a cost effective, reliable basis.
Entry into the Market
We plan to enter selected target markets (i.e. the Caribbean and California) based upon the Sparks Spread. These markets were selected because we believe they have the greatest potential for immediate acceptability of the PDI Power Solution due to cost and reliability as well as offering the greatest profit potential. Once established, we plan to expand further into the Caribbean and North American markets using the same criteria: Spark Spread and profitability.
Pricing
Our intent is to provide electrical power atThe Fuel cost for a lower price than the current utility companies. The PDI Power Solution pricing isnatural gas generator, based on the Spark Spread (the difference between themanufacture’s speck is .03 a kilowatt hour based on Natural gas’s current pricing. The financing cost ofare .025 to .035 a kilowatt hour based on 10% financing costs for 5 years. .01 a kilowatt hour for routine maintenance. .05 for a maintenance reserve. The total estimated costs are about .075 a kilowatt hour. The average price for electricity provided by the utility company and the cost of electricity produced by a PDI Power Solution.) Based on this model the PDI Power Solutions can typically offer a Spark Price of 15%. If we use the Caribbean as an example with an average electric rate of $0.30/kWh,has a range from .30 to .40 a kilowatt hour and some areas in the United States can be up to .20 to .30 a Spark Price of $0.05/kWh, then a client using 150,000 kWh per month would expect to save $90,000 a year using a PDI Power Solution which, in turn, would yield $450,000 in revenue per year for the five year life of the contract.kilowatt hour.
Competition
We believe we are an insignificant participant among the firms, which engage in the acquisition of business opportunities. There are many established venture capital and financial concerns that have significantly greater financial and personnel resources and technical expertise than we have. In view of our limited financial resources and limited management availability, we will continue to be at a significant competitive disadvantage compared to our competitors
Employees
We have a total of three (3)one executive officers only one of whom, Ms. Madison,is employed on a full time basis and receives a salary.officer. The remaining officersexecutive officer will not receive any compensation until, and if, we raise or procure adequate capital (through operations, financings or otherwise) to pay such compensation.
We expect that we will hire additional personnel as we expand our operations.
Available Information
Additional information about us is contained at our website,www.powerdyneinternational.com. Information on our website is not incorporated by reference into and does not form any part of this Annual Report on Form 10-K. We have included our website our address as a factual reference and do not intend it to be an active link to our website. We make available on our website our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act are available free of charge through the investor relations page of our internet website as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC as soon as reasonably practicable after those reports are filed with the SEC.
Our phone number is (401) 739-3300 and our facsimile number is (401) 944-4620
Our corporate headquarters are located in a full service office suite located in a building in Cranston, Rhode Island, consisting of approximately 1,000 square feet of office space that we lease on a month-to-month pursuant to a lease agreement with a monthly rent of $500. We believe that our existing facilities are suitable and adequate and that we have sufficient capacity to meet our anticipated needs.
Additional locations may be needed in the future, primarily administrative in nature; however some may also need to be both administrative as well as support field service offices and a warehouse facility for service inventory. The decision to open addition locations will be market driven. Based on the strategic relationships that have developed with our generator suppliers and contractors, we do not see the need for manufacturing space for the foreseeable future.
ITEM 3. LEGAL PROCEEDINGSCAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
LitigationThis Form 10-Kcontains forward-looking statements that may be affected by matters outside our control that could cause materially different results.
There are statements in this Registration Statement that are not historical facts. These “forward-looking statements” can be identified by use of terminology such as “believe,” “hope,” “may,” “anticipate,” “should,” “intend,” “plan,” “will,” “expect,” “estimate,” “project,” “positioned,” “strategy” and similar expressions. You should be aware that these forward-looking statements are subject to risks and uncertainties that are beyond our control. For a discussion of these risks, you should read this entire Registration Statement carefully, especially the risks discussed under the section entitled “Risk Factors.” Although management believes that the assumptions underlying the forward-looking statements included in this Registration Statement are reasonable, they do not guarantee our future performance, and actual results could differ from those contemplated by these forward-looking statements. The assumptions used for purposes of the forward-looking statements specified in the following information represent estimates of future events and are subject to uncertainty as to possible changes in economic, legislative, industry, and other circumstances. As a result, the identification and interpretation of data and other information and their use in developing and selecting assumptions from and among reasonable alternatives require the exercise of judgment. To the extent that the assumed events do not occur, the outcome may vary substantially from anticipated or projected results, and, accordingly, no opinion is expressed on the achievability of those forward-looking statements. In light of these risks and uncertainties, there can be no assurance that the results and events contemplated by the forward-looking statements contained in this Registration Statement will in fact transpire. You are cautioned to not place undue reliance on these forward-looking statements, which speak only as of their dates. We do not undertake any obligation to update or revise any forward-looking statements.
The Company is not involved in any legal proceedingscompany qualifies as a smaller reporting company, as defined by § 229.10(f)(1) and is not aware of any threatened or imminent legal proceedings.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Since our common stock began trading in May of 2013 our common stock has been quoted onrequired to provide the OTC Bulletin Board under the symbol PWDY.
The following table sets forth the range of the high and low sales prices of our common stock for each of the calendar quarters during the years ended December 31, 2016 and December 31, 2015.
| OTC Bulletin Board | High | Low | ||||||
| 1st Quarter | $ | 0.0039 | $ | 0.0005 | ||||
| 2nd Quarter | $ | 0.0013 | $ | 0.0003 | ||||
| 3rd Quarter | $ | 0.0010 | $ | 0.0003 | ||||
| 4th Quarter | $ | 0.0005 | $ | 0.0003 | ||||
| Year Ended December 31, 2015 | ||||||||
| 1st Quarter | $ | 0.0011 | $ | 0.0002 | ||||
| 2nd Quarter | $ | 0.0009 | $ | 0.0002 | ||||
| 3rd Quarter | $ | 0.0007 | $ | 0.0003 | ||||
| Year Ending December 31, 2016 | ||||||||
The last price of our common stock as quoted on the OTC Bulletin Board on April 3, 2017 was $0.0004. As of December 31, 2016 we had approximately 40 stockholders of record.information required by this Item.
Dividend Policy
We have never paid nor declared any cash dividends on our common stock to date, and do not anticipate paying such cash dividends in the foreseeable future. Whether we declare and pay dividends is determined by our Board of Directors at their discretion, subject to certain limitations imposed under Delaware corporate law. The timing, amount and form of dividends, if any, will depend on, among other things, our results of operations, financial condition, cash requirements and other factors deemed relevant by our Board of Directors
Equity Compensation Plan Information
Our board of directors adopted the 2014 Stock Option Plan (the “Plan”) in 2014 to promote our long-term growth and profitability by (i) providing our key directors, officers and employees with incentives to improve stockholder value and contribute to our growth and financial success and (ii) enable us to attract, retain and reward the best available persons for positions of substantial responsibility. A total of 100,000,000 shares of our common stock have been reserved for issuance upon exercise of options granted pursuant to the Plan. The Plan allows us to grant options to our employees, officers and directors and those of our subsidiaries; provided that only our employees and those of our subsidiaries may receive incentive stock options under the Plan. We have granted a total of 0 shares of stock as of December 31, 2016 under the Plan.
Set forth below is detail with respect to issuances under the Plan.
| Plan category | Number of securities issued under equity compensation plan | Weighted-average exercise price of outstanding options | Number of securities remaining available for future issuance under equity compensation plans | |||||||||
| Equity compensation plans approved by security holders | ||||||||||||
| Equity compensation plans not approved by security holders | ||||||||||||
| Total | -0- | -0- | 100,000,000 | |||||||||
Sale of Unregistered SecuritiesITEM 2. FINANCIAL INFORMATION
We did not sell any equity securities duringThis Form 10- K contains forward-looking statements. Our actual results could differ materially from those set forth as a result of general economic conditions and changes in the fiscal year ended December 31, 2016assumptions used in transactions that were not registered undermaking such forward-looking statements. The following discussion and analysis of our financial condition and results of operations should be read together with the Securities Act of 1933, as amended,audited consolidated financial statements and accompanying notes and the other than as previously disclosedfinancial information appearing elsewhere in our filings with thethis report. The analysis set forth below is provided pursuant to applicable Securities and Exchange Commission.
Issuer PurchasesCommission regulations and is not intended to serve as a basis for projections of Equity Securities
There were no issuer purchases of equity securities during the fiscal year ended December 31, 2016.
ITEM 6. SELECTED FINANCIAL DATA
There is no selected financial data requiredfuture events. Refer also to be filed for a smaller reporting company.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL INFORMATION AND RESULTS OF OPERATIONS“Cautionary Note Regarding Forward Looking Statements” in Item 1 above.
We are an operational company which has experienced losses since our inception. Our independent auditors have issued a report raising a substantial doubt about our ability to continue as a going concern. We have only entered into one agreement for the leasing of our equipment to date and have not yet derived any revenue from such agreement. Our sources of cash to date have been capital invested by shareholders and venture capital investors/lenders. Our cumulative revenue $1,240,of $13,139 has come from two sources: 1) $1,240 from our one outstanding equipment lease agreement, which was terminated in September 2017 due to a natural disaster; and 2) $11,899 from crypto-mining revenue, of which $488$3,521 was received during the year ended December 31, 20162020 and the remaining $752$8,378 was received during the year ended December 31, 2015.
2019.
The basis of our overall business is founded on our ability to produce electrical power using state-of-the-art technology to power electrical generation equipment to produce electricity at a lower cost than the existing means of producing or providing primary electric power in its target markets. We expect that the difference between our cost to produce electrical power and the current billing rate of existing local utility providers will present savings for our customers and revenue opportunity for us.
Our business is to install and maintain, own and operate electrical power generation equipment (“gensets”) at client locations. We will own and maintain the equipment to be installed with the customer who will use it to produce its own electrical power. Our products are intended to be portable, easy-to-use units that can be conveniently deployed in various locations around the world. The units can also be assembled and combined to produce power centers providing up to 50100 megawatts of power.
During the 1st quarter of 2019 Powerdyne International, Inc. purchased several crypto currency miners and began mining certain crypto coins. This was done in an effort to conservatively enter into the crypto markets and explore other potential revenue producing opportunities for Powerdyne International, Inc. We are only mining SIA coin currently. The exchange rate is determined by the crypto exchanges. We have sold some mined coins for US $ in early to mid-2019. The total revenue generated by the Sia coins sold in 2019 was $7,112. Since July 2019 we have not converted any coins to US $ or any other currency or Crypto Currency and continue to hold them in the company’s digital wallet. The estimated numbers of SIA coin held in our digital wallet as of December 31, 2020 is approximately 1,535461. The Company is currently running 4 Obelisk SCI Generation 1 miners running an average hash rate of 600+ GHs. The Company is not actively engaged in the purchase of additional crypto currencies and is focusing on providing power solutions to its future clients.
The coins are stored in our Sia coin digital wallet which is housed in Sia coins cloud storage.
Powerdyne has a bill of sale that shows ownership via serial #s and, has possession of the miners and the Sia coin digital wallet codes. The biggest cyber security threat is an exchanged being hacked which the exchanges have insurance for the clients funds and coins. For security Powerdyne stores all it’s Sia coins in it’s our digital wallet and are only transferred to the exchange when they are to be converted to USD. For security purposes Powerdyne has it’s digital wallet address and pass codes stored offline and backups are also stored offline in separate locations. Powerdyne believes the cyber threat is very low do to the very small size and value of our mining operation and the complexity required to break into a crypto wallet.
Governmental Regulations Regarding Crypto Currency
Government regulation of blockchain and crypto is being actively considered by the United States federal government via a number of agencies (including the U.S. Securities and Exchange Commission (the “SEC”), the U.S. Commodities Future Trading Commission (“CFTC”), Federal Trade Commission (“FTC”), and the Financial Crimes Enforcement Network (“FinCEN”) of the U.S. Department of the Treasury) and in other countries. Other regulatory bodies are governmental or semi-governmental and have shown an interest in regulating or investigating companies engaged in the blockchain business (NASDAQ, NYSE, FINRA, state securities commissions).
Blockchain and crypto currency regulations are in a nascent state with agencies investigating businesses and their practices, gathering information, and generally trying to understand the risks and uncertainties in order to protect investors in these businesses. Regulations will certainly increase, in many cases, although it is presently not possible to know how they will increase, how regulations will apply to the Company’s businesses, or when they will be effective. Various bills have also been proposed in congress for adoption related to the Company’s business which may be adopted and have an impact on it. As the regulatory and legal environment evolves, the Company may become subject to new laws and further regulation by the SEC and other agencies, although the Company is not currently trading in digital assets and has no intention to trade in digital assets.
During the 4th quarter of 2019 Powerdyne accepted forgiveness of debt letters from the related party debt holders forgiving all unpaid debt and accrued interest owed to them individually, by the Corporation. During this same period Powerdyne International as part a corporate reorganization, accepted the resignation of the Director of the Corporation and as Chairman of the Board. The remaining directors unanimously resolved to elect James O’Rourke as Chairman of the Board. The Company then accepted the resignation of the remaining Board of Directors.
The following discussion contains forward-looking statements, as discussed above. Please see the sections entitled "Forward-Looking“Forward-Looking Condensed Statements"Statements” and "Risk Factors"“Risk Factors” for a discussion of the uncertainties, risks and assumptions associated with these forward-looking statements.
Investment Company Act 1940
Although we will be subject to regulation under the Securities Act of 1933, as amended, and the 1934 Act, we believe we will not be subject to regulation under the Investment Company Act of 1940 (the “1940 Act”) insofar as we will not be engaged in the business of investing or trading in securities. We have no intent to continue to engage in the business of buying and selling digital assets. In the event we engage in such business that results in us holding passive investment interests in digital assets, we could be subject to regulation under the 1940 Act. In such event, we would be required to register as an investment company and incur significant registration and compliance costs. We have obtained no formal determination from the SEC as to our status under the 1940 Act and, consequently, any violation of the 1940 Act would subject us to material adverse consequences. We believe that, currently, we are exempt under Regulation 3a-2 of the 1940 Act.
The following discussion and analysisvalue of our financial condition and resultsthe Cryptocurrency held by the Company is determined by the price of operations are based on our audited condensed financial statementsthe Cryptocurrency as set forth by Bittrx, Inc., a U.S. cryptocurrency platform, as of December 31, 2016 and 2015, which were prepared in accordance with U.S. generally accepted accounting principles ("GAAP"the last day of each of the Company’s financial quarters. In the event that the value of the Company’s Cryptocurrency holdings exceeds forty percent (40%) and should be read in conjunction withof the audited financial statements and notes thereto forCompany’s total assets, the year ended December 31, 2015 found in this report.Company intends to sell that amount of its Cryptocurrencies that will allow the Company to remain exempt under Regulation 3a-2 of the 1940 Act.”
Operations
OurThe Company’s strategy is to pursue selected opportunities in markets where inexpensive and environmentally friendly power sources are needed and/or required.
Results of Operations - The year ended December 31, 20162020 compared to the year ended December 31, 2015:2019:
Revenues
We generated revenues of $752$3,521 during the year endingended December 31, 20152020, and $488$8,378 during the year endingended December 31, 2016, respectively.2019.
Operating expenses
During the year ended December 31, 20162020 total operating expenses decreased 59.18%increased 114.16% to $166,165$55,237 from $407,101$25,793 for the year ended December 31, 2015.2019. The decreaseincrease is related mainly due to a decreaseincreases of (i)$25,133 in salaries and wages (ii) $17,409 in outside sales consultant expense, (iii) $7,390$8,330 in filing fees(iv) $28,040fees, $386 in stock registration fees, $34,640 in legal and accounting(v) $12,875accounting expense, $112 in materialstelephone expense, and a minor increase in office supplies and (vi) $122,500expense. These increases were offset by decreases of $4,128 in consulting fees, $1,846 in other taxes expense, $8,000 in non-employee stock compensation. We also experiencedcompensation, and minor decreases in bank service charges and payroll tax expense, freight and delivery, stock registration fees, internet expense, permit fees, investor relations activities, rent expense, equipment rental, engine fuel, cellphone expense, travel and entertainment expense and depreciation expense. This decrease was offset by increases of $8,209 in interest expense, $11,321 in bad debt expense, $1,804 in machine shop and outside service, and $1,249 in insurance expense.processing fees.
Net lossincome (loss)
The net loss for the years ended December 31, 2016 and 2015, was $184,286 and $539,060, respectively. The net loss for the year ended December 31, 2016 included loss on sale of equipment of $18,109.2020 was $57,256. The net loss for the year ended December 31, 2015 included amortization of debt expense of $138,260 and derivative expense from the notes issued to investors or $43,877 offset by the change in fair value of derivatives related to the note issuances of ($50,345). The company did not enter into any convertible promissory notes in 2016.2019 was $60,677.
Liquidity and Capital Resources
As of December 31, 20162020, and 2015,2019, we had working capital deficits of $477,962$122,712 and $452,739$68,456, respectively. The decrease in working capital in 2016 of $25,223 resulted primarily from increased operating expenses of $240,936. For the year from December 31, 2015 to December 31, 2016, our cash decreased by $1,850. The cash used byin operations of $49,055$65,127 was primarily due to net loss from operations of $184,286$57,256, less non-cash adjustments to net operating cash flowsused in operations of $8,626$3,521 of asset held for sale and $7,750 of accrued expenses, plus $3,000 of depreciation $11,321expense and $400 in bad debt expense, $30,050 in stock compensation, $18,109 in loss on sale of equipment, an increase of accrued but unpaid expenses of $66,625, and an increase of taxes payable of $500.payable. The total net cash provided byused in investing activities of $18,000 was due to proceeds from sale of equipment.$-0-. The total net cash provided by financing activities of $29,205$57,040 was due to proceeds of notes payablefrom due to related parties.party of $54,900 and proceeds from notes payable-stockholder of $2,140. We have no known demands or commitments and are not aware of any events or uncertainties as of December 31, 2020 that will result in or that are reasonably likely to materially increase or decrease our current liquidity.
We believe that anticipated cash flows from operations will be insufficient to satisfy our ongoing capital requirements. We have and continue to receive financing in the form of loans from Executive Management in order to provide the necessary working capital. Our ability to meet our obligations and continue to operate as a going concern is highly dependent on our ability to obtain additional financing. We cannot predict weather this additional financing will be in the form of equity or debt. The financing for these goals could come from further equity financing or could come from sales of securities and /or loans. If we are not successful in generating sufficient liquidity from operations or in raising sufficient capital resources, on terms acceptable to us, this could have a material adverse effect on our business, results of operations liquidity and financial condition.
Proposed Goals Over the Next Twelve Months.
| Redo our website for better marketing 0-90 days | ||
| ● | Develop marketing materials / brochures 0-90 days | |
| ● | Establish marketing channels 90-180 days | |
| ● | Establish marketing partnerships 3-12 months |
| ● | Employ a part time to full time salesperson 3-12 months | |
| ● | Establish financing partnerships 3-12 months |
We currently owe principal in the amount of $400,810 (exclusive of interest) under notes due to related parties payable with dues dates and principal amounts as follows:
| Maturity Date | Principal | |||
| Jan-17 | $ | 25,000 | ||
| Feb-17 | $ | 35,000 | ||
| Apr-17 | $ | 40,000 | ||
| May-17 | $ | 52,147 | ||
| Jun-17 | $ | 45,000 | ||
| Jul-17 | $ | 25,000 | ||
| Aug-17 | $ | 15,000 | ||
| Sep-17 | $ | 13,000 | ||
| Oct-17 | $ | 28,102 | ||
| Nov-17 | $ | 16,049 | ||
| Dec-17 | $ | 22,234 | ||
| Jan-18 | $ | 2,500 | ||
| Feb-18 | $ | 20,300 | ||
| Mar-18 | $ | 12,780 | ||
| Jun-18 | $ | 12,625 | ||
| Jul-18 | $ | 5,973 | ||
| Aug-18 | $ | 11,100 | ||
| Sep-18 | $ | 6,000 | ||
| Dec-18 | $ | 13,000 | ||
| Total | $ | 400,810 | ||
To date, we have generated revenue of $1,240, and there is doubt that we will have the requisite funding to repay these loans when due.
| Development and Operating expense | Estimated Expenses | |||||
| Redo Website | 90 Days | $ | 5,000 | |||
| Marketing Materials | 90 Days | $ | 10,000 | |||
| Marketing | 12 Months | $ | 10,000 | |||
| Operating and General Expenses | 12 Months | $ | 20,000 | |||
| Salaries | 12 Months | $ | 30,000 | |||
| Legal Expenses | 12 Months | $ | 20,000 | |||
| Accounting Fees | 12 Months | $ | 15,000 | |||
| Printing and Filing costs | 12 Months | $ | 5,000 | |||
| Total Estimated Costs | 12 Months | $ | 115,000 | |||
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements that are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is deemed by our management to be material to investors.
Critical Accounting Policies
In addition to the accounting policies listed below, other significant accounting policies are disclosed in Note 1 of our Financial Statements included elsewhere in this Form 10-K.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts during the reporting periods. Actual results could differ from those estimates. Significant estimates and assumptions included in our financial statements relate to estimate of loss contingencies and accrued other liabilities.
Fair Value of Financial Instruments
ASC 820-10 (formerly SFAS No. 157,Fair Value Measurements) requires entities to disclose the fair value of financial instruments, both assets and liabilities recognized and not recognized on the balance sheet, for which it is practicable to estimate fair value. ASC 820-10 defines the fair value of a financial instrument as the amount at which the instrument could be exchanged in a current transaction between willing parties. As of December 31, 20162020, and 2015,December 31, 2019, the carrying value of certain financial instruments such as accounts receivable, accounts payable, notes payable-related parties, accrued expenses, and amounts due to/from related party approximates fair value due to the short-term nature of such instruments.
Impairment of Long-Lived Assets
In accordance with ASC 350-30 (formerly SFAS No. 144,Accounting for the Impairment or Disposal of Long-Lived Assets), we evaluate long-lived assets for impairment whenever events or changes in circumstances indicate that their then carrying values may not be recoverable. When such factors and circumstances exist, we compare the projected undiscounted future cash flows associated with the related asset or group of assets over their estimated useful lives against their respective carrying amount. Impairment, if any, is based on the excess of the carrying amount over the fair value, based on market value when available, or discounted expected cash flows, of those assets and is recorded in the period in which the determination is made. Our management currently believes there is no impairment of its long-lived assets. There can be no assurance however, that market conditions will not change or demand for our products under development will continue. Either of these could result in future impairment of long-lived assets.
Recently Issued Accounting Pronouncements
In June 2014,January 2017, the FASBFinancial Accounting Standards Board (“FASB”) issued ASU 2014-10, Development Stage EntitiesAccounting Standards Update (“ASU”) 2017-01, Business Combinations (Topic 915): Elimination of Certain Financial Reporting Requirements. ASU 2014-10 eliminates805) to clarify the distinctiondefinition of a development stage entitybusiness, which is fundamental in the determination of whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses combinations. The updated guidance requires that in order to be considered a business the integrated set of assets and certain related disclosure requirements, includingactivities acquired must include, at a minimum, an input and process that contribute to the eliminationability to create output. If substantially all of inception-to-date information on the statementsfair value of operations, cash flowsthe assets acquired is concentrated in a single identifiable asset or group of similar assets, it is not considered a business, and stockholders’ equity.therefore would not be considered a business combination. The amendments in ASU 2014-10 will beupdate is effective prospectively for annual reporting periodsfiscal years beginning after December 15, 2014,2018, and interim periods within those annual periods, however early adoption is permitted.with fiscal years beginning after December 15, 2019. The Company adopted ASU 2014-10 sinceis currently evaluating the quarter ended June 30, 2014, thereby no longer presenting or disclosing any information required by Topic 915.impact of adopting this guidance on our consolidated financial statements.
In August 2014,March 2016, the FASB issued ASU No. 2014-15, “Presentation2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting (ASU 2016-09). Under ASU 2016-09, the tax effects of Financial Statements – Going Concern (Subtopic 205-40): Disclosurestock compensation will be recognized as income tax expense or benefit to the Company’s income statement and the tax effects of Uncertainties aboutexercised or vested awards will be treated as discrete items in the reporting period in which they occur. Along with other income tax cash flows, excess tax benefits will be classified as operating activities, and cash paid by the Company when directly withholding shares for tax withholding purposes will be classified as financing activities. At this time, this does not apply to the Company and therefore does not have an Entity’s Ability to Continue as a Going Concern” (“ASU 2014-15”). ASU 2014-15, which is effective for annual reporting periods ending after December 15, 2016, extends the responsibility for performing the going-concern assessment to management and contains guidanceimpact on how to perform a going-concern assessment and when going-concern disclosures would be required under U.S. GAAP.its current financial statements. The Company electeddecided to adopt ASU 2014-15 effective with this financial statement. Management’s evaluations regarding the events and conditions that raise substantial doubt regardingaccount for forfeitures when they occur, which, did not have a material impact to the Company’s ability to continue as a going concern have been disclosed in this Note 5.financial statements.
In the opinion of management, inflation has not and will not have a material effect on our operations in the immediate future.
Management will continue to monitor inflation and evaluate the possible future effects of inflation on our business and operations.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATAOff-Balance Sheet Arrangements
ThePer SEC regulations, we are required to disclose our off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial statements and Reportcondition, such as changes in financial condition, revenues, expenses, results of Independent Registered Accounting Firm for the years endedoperations, liquidity, capital expenditures, or capital resources that are material to investors. As of December 31, 20162019, and 2015 are attached to this report.December 31, 2020, we have no off-balance sheet arrangements.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
The Company had no disagreements on any matter of accounting principle or practice, financial statement disclosure or audit scope or procedure with its accountant.
ITEM 9A. CONTROLS AND PROCEDURES
We have adoptedEvaluation of Disclosure Controls and maintain disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed inProcedures
Our management conducted an evaluation, with the reports filed under the Exchange Act, such as this Annual Report on Form 10-K, is collected, recorded, processed, summarized and reported within the time periods specified in the rulesparticipation of the SEC. Our disclosure controls and procedures are also designed to ensure that such information is accumulated and communicated to management to allow timely decisions regarding required disclosure. As required under Exchange Act Rule 13a-15, our management, including our Chief Executive Officer, who is our principal executive officer and Chief Financial Officer, after evaluatingour principal financial and accounting officer, of the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this Annual Reportregistration statement on Form 10-K, have10. Based on that evaluation, we concluded that based on such evaluation, that the Company’s disclosure controls and procedures were effective to ensure that information required to be disclosed by the Company in the reports that the Company files or submits under the Exchange Act, is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer as appropriate, to allow timely decisions regarding required disclosure.
Management’s Report of Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Exchange Act Rule 13a-15. Our internal control over financial reporting is defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act as a process designed to provide reasonable assurance to our management and Board of Directors regarding the preparation and fair presentation of published financial statements. Management conducted an assessment of our internal control over financial reporting as of December 31, 2016 based on the framework and criteria established by the Committee of Sponsoring Organizationsbecause of the Treadway Commission in Internal Control-Integrated Framework (2013). Based on the assessment, management concluded that, as of December 31, 2016, our internal control over financial reporting was not effective based on those criteria.
Our management does not expect that our disclosure controlsmaterial weakness and procedures and our internal control processes will prevent all error and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of error or fraud, if any, within our company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that the breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and may not be detected. However, these inherent limitations are known features of the financial reporting process. Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk.
Anton & Chia, the independent registered public accounting firm, is not required to and has not issued an attestation report on the effectiveness of the internal control over financial reporting.
Changes in Internal Control Over Financial Reporting
There has been no changesignificant deficiencies in our internal control over financial reporting (as defined in Rules 13a-15(f)described below, our disclosure controls and 15d-15(f)procedures were not sufficient as of the Exchange Act) that occurred during our fiscal quarter ended December 31, 2016 that has materially affected,2019 or is reasonably likely to materially affect,December 31 2020.
This registration statement on Form 10-K does not include an attestation report from our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the Company’s registered public accounting firm pursuant to rules of the Commission that permit us to provide only management’s report in this registration statement on Form 10-K.
ITEM 9B. OTHER INFORMATIONSUBSEQUENT EVENTS
ThereWe have evaluated subsequent events after December 31, 2020 through the date this report was filed and has determined there have been no subsequent events for which disclosure is no information required to be disclosed on Form 8-K during the fourth quarter covered by this Form 10-K not otherwise reported.required.
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE3: PROPERTIES
Our Directorscorporate headquarters are located in a full-service office suite located in a building in North Reading, Massachusetts, consisting of approximately 500 square feet of office space. We believe that our existing facilities are suitable and Officers are as follows:adequate and that we have sufficient capacity to meet our anticipated needs.
| Name | Age | Position | Year Commenced As An Officer Or Director | |||||
| James F. O’Rourke | 62 | Chief Executive Officer and Director | 2014 | |||||
| Arthur M. Read, II, Esq. | 70 | Executive Vice President, General Counsel and Director | 2010 | |||||
| John M. Faulhaber | 83 | Director | 2014 | |||||
| Robert C. Hemsen | 68 | Director | 2014 | |||||
| Linda H. Madison | 69 | Secretary / Treasurer | 2011 |
James F. O’RourkeITEM 4: SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth as of December 31, 2020 the number and percentage of the outstanding shares of common stock, which, according to the information available to us, were beneficially owned by:
| (i) | each person who is currently a director, |
| (ii) | each executive officer, |
| (iii) | all current directors and executive officers as a group, and |
| (iv) | each person who is known by us to own beneficially more than 5% of our outstanding common stock. |
Except as otherwise indicated, the persons named in the tables below have sole voting and dispositive power with respect to all shares beneficially owned, subject to community property laws where applicable.
| COMMON STOCK | Number of Shares of | Percent of | ||||||||
| Name | Position | Common Stock | Class (1) | |||||||
| James F. O’Rourke | Chief Executive Officer | 215,825,000 | 10.8 | % | ||||||
| Arthur M. Read, II, Esq. | Shareholder | 183,000,000 | 9.5 | % | ||||||
| Eric Foster | Shareholder | 135,000,000 | 7.1 | % | ||||||
| Dale P. Euga | Shareholder | 139,024,408 | 7.3 | % | ||||||
| Linda H. Madison | Shareholder | 114,000,000 | 6.0 | % | ||||||
| Total owned by officers and directors (1) | 215,825,000 | 10.8 | % | |||||||
(1) Based upon 1,914,930,584 shares outstanding.
ITEM 5: DIRECTORS AND EXECUTIVE OFFICERS
Directors and Executive Officers
The following table sets forth the names, ages, and positions with us for each of our directors and officers as of December 31, 2020:
| Name | Age | Position | Since | |||
| James F. ‘Rourke | 65 | President, Secretary, CFO and Director | May 6, 2016 |
James F. O’Rourke serves as Chief Executive Officer and Director of the Company. He attended Lowell Technological Institute. With over thirty-five years’ experience in manufacturing from design conception to production as well as in acquisitions, mergers and managing the operational side of startup businesses, Mr. O’Rourke (the Vice Present and General Manager of SatCon Technology Corporation, the Manager of Drive Systems for its Applied Technology business unit and the Manager of its Magmotor business unit) was responsible for SatCon’s day-to-day operation and subsequently was instrumental in the formation of SatCon’s successor: SatCon Power Systems. Mr. O’Rourke then founded CM Technology (which designs and manufactures custom motors for the automotive, industrial and robotic markets as well as high power rotary uninterruptable power supplies (RUPS) for the distributed generation, industrial, telecommunication, cloud data center and power quality markets). Mr. O’Rourke, who is still actively involved in CM, joined Powerdyne as a consultant in 2013 and was elected its CEO and a Director in 2014. Due to Mr. O’Rourke’s knowledge of our industry and his manufacturing experience we selected him to serve as a director.
Arthur M. Read, II, Esq.
Arthur M. Read, II, Esq., serves as Executive Vice-President, General Counsel and as a Director of the Company. Mr. Read received his Bachelor of Arts degree from Bethany College in 1968, his Masters of Arts degree from the University of Rhode Island in 1971 and his Juris Doctor degree from Boston University School of Law in 1972. From 1972-2001, Mr. Read was an Associate, then Stockholder and Vice-President of Gorham & Gorham, Inc. an established Rhode Island law firm, with whom he was engaged in the general practice of law with an emphasis on litigation, commercial and business matters and had an extensive appellate practice. In 1974, Mr. Read was appointed a Special Assistant Attorney General by the Rhode Island Attorney General. In 2001, Mr. Read formed his own law practice. Admitted to practice before the Rhode Island Supreme Court; United States District Court, District of Rhode Island; United States Supreme Court; United States Tax Court; and United States Court of Appeals. Martindale-Hubble (the nationally renowned attorney rating service) has awarded Mr. Read both the highest Peer Review rating: “AV® Preeminent™” and Client Review rating: “Preeminent”. Mr. Read is a member of the Rhode Island Bar Association, the Rhode Island and American Associations for Justice. Mr. Read’s extensive legal, commercial and business experience qualifies him to serve as a director.
Robert C. Hemsen
Robert C. Hemsen, serves as a directorAudit Committee
Powerdyne does not presently have an Audit Committee and the Vice-Chairmanentire Board acts in such capacity for the immediate future due to the limited size of the Board. Powerdyne intends to increase the size of its Board in the future, at which time it may appoint an Audit Committee.
In lieu of an Audit Committee the Board is empowered to make such examinations as are necessary to monitor the corporate financial reporting and the external audits of Powerdyne, to provide to the Board of Directors.Mr. Hemsen graduatedDirectors (the “Board”) the results of its examinations and recommendations derived there from, Adelphi University with both a BBAto outline to the Board improvements made, or to be made, in internal control, to nominate independent auditors, and MBA. An Honorable Discharged Air Force veteran, Mr. Hemsen worked in various business positionsto provide to the Board such additional information and materials as it may deem necessary to make the Board aware of increasing responsibility, including fifteen years in executive positions, in the merged or acquired business units of Honeywell International. These would include assignments in FRAM/Autolite, Bendix Corporation, Allied and AlliedSignal Corporations. Hemsen joined IBM in 1994 after nearly twenty-five years with Honeywell International. His industrial experience involved business units in Aerospace & Defense, Automotive OEM & Aftermarket Products, Chemicals & Specialty Materials and Information Technology & Services. He retired from IBM as its Director of Human of Resources, Corporate Development, Mergers and Acquisitions. Due to Mr. Hemsen’s commercial and business experience we selected him to serve as a directorsignificant financial matters that require Board attention.
Compensation Committee
Powerdyne does not presently have a Nominating Committee and the Board acts in such capacity for the immediate future due to the limited size of the Board. Powerdyne intends to increase the size of its Board in the future, at which time it may appoint a Compensation Committee.
The Compensation Committee will be authorized to review and make recommendations to the Board regarding all forms of compensation to be provided to the executive officers and directors of Powerdyne, including stock compensation, and bonus compensation to all employees.
John M. FaulhaberNominating Committee
John M. Faulhaber serves asPowerdyne does not have a DirectorNominating Committee and Chairman of the Board of Directors. A graduate of The Choate School (now Choate Rosemary Hall) and Middlebury College, Mr. Faulhaber servedacts in and was honorably discharged from the United States Army as a Captain. He thereafter worked as a broker in New York City for an international stock brokerage firm for twelve years before becoming a Trust Officer and Vice President at the Private Bank of Rhode Island Hospital Trust National Bank, where he served until his retirement. He was subsequently elected the Grand Secretary of the Grand Lodge of Freemasons for the State of Rhode Island for thirteen years until his subsequent, semi-final, retirement. Mr. Faulhaber has been a lecturer at Providence College in Military Science, has devoted a substantial amount of his volunteer time as a Boy Scout leader and is active in his church where he also took on leadership roles. Mr. Faulhaber’s extensive experience with investments, money management and corporate governance qualify him to serve the corporation as a Director in a leadership role.
Linda H. Madison
Linda H. Madison serves as Secretary, Principal Financial and Accounting Officer of the Company. Ms. Madison has forty years of operational and managerial experience. For the period of eighteen years prior to joining the Company, she has served in the capacity of Administrative and Legal Assistant responsible for human resources, information technology, office coordination, creating various publications and designing and maintaining complex data bases. She previously worked as the Executive Secretary and Treasurer for a large investment advisory firm in Rhode Island.
Director Independence
Although our common stock is not listed on any national securities exchange, for purposes of independence we use the definition of independence applied by the NASDAQ Stock Market. The Board has determined that due to each director’s relationship with us, that none of our directors is independent.
Audit Committee and Audit Committee Financial Expert
Our board of directors acts as our audit committee. We have determined that each of our directors is an “audit committee financial expert,” as that term is defined in Item 407(d) of Regulation S-K promulgated under the Securities Act.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act 1934 requires our directors and executive officers, and persons who own more than 10% of a registered class of our equity securities, to file with the SEC initial reports of ownership and reports of changes in ownership of our common stock and our other equity securities. Officers, directors and greater than 10% shareholders are required by the SEC regulations to furnish us with copies of all Section 16(a) forms they file. These filings are publicly available on the SEC’s website atwww.sec.gov. Based solely on our review of the copies of such forms received by us and our review of the SEC’s website, we believe that during fiscal year ended December 31, 2016, all filing requirements applicable to our officers, directors and greater than 10% percent beneficial owners were complied with other than an inadvertent late filing for Mr. Read of a Form 4 for one stock acquisition.capacity.
Code of Conduct and Ethics
WeTo date, we have established and maintainnot adopted a Code of Ethics which is applicable to all employees, officers,our principal executive officer and directors. Our policyprincipal financial officer because the Company has no meaningful operations. The Company does not believe that a formal written code of ethics is designed to deter wrongdoingnecessary at this time. We expect that the Company will adopt a code of ethics if and to promote honestwhen the Company successfully completes a business combination that results in the acquisition of an on-going business and ethical conduct and compliance with all applicable laws and regulations. It also communicates our expectations of our employees and helps enable us to provide accurate and timely disclosure in our filings with the SEC and other public communications. In addition, the policy incorporates guidelines pertaining to topics such as environmental compliance, health and safety compliance; diversity and non-discrimination; vendor relations, employee privacy; and business continuity.thereby commences operations.
We willIndemnification of Executive Officers and Directors
Our articles provide any person without charge, upon writtento the fullest extent permitted by Delaware Law, wherein our directors or oral requestofficers shall not be personally liable to the Company or our corporate headquarters, a copystockholders for damages for breach of such directors or officers fiduciary duty. The effect of this provision of our Codearticles is to eliminate our rights and the rights of Ethics.our stockholders (through stockholders’ derivative suits on behalf of the Company) to recover damages against a director or officer for breach of the fiduciary duty of care as a director or officer (including breaches resulting from negligent or grossly negligent behavior), except under certain situations defined by statute. We believe that the indemnification provisions in our articles are necessary to attract and retain qualified persons as directors and officers.
ITEM 11. EXECUTIVE COMPENSATION
| Annual | Annual | Stock | All | Annual | |||||||||||||||||||||||
| Payments | Payments | And | Compensation | Other | Compensation | ||||||||||||||||||||||
| Name/Position | Year | Salary | Made | Options | Plans | Compensation | Total | ||||||||||||||||||||
| James F. O’Rourke | 2016 | $ | 0 | $ | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||
| Chief Executive Officer | 2015 | $ | 0 | $ | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||
| Arthur M. Read II, Esq. | 2016 | $ | 0 | $ | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||
| Vice President | 2015 | $ | 0 | $ | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||
| Linda H. Madison Principal Financial Officer and | 2016 | $ | 3,277.08 | $ | 0 | 0 | 0 | 0 | $ | 3,277.08 | |||||||||||||||||
| Principal Accounting Officer | 2015 | $ | 28,410.20 | $ | 0 | 0 | 0 | 0 | $ | 28,410.20 | |||||||||||||||||
No executiveDelaware corporate law provides that a corporation may indemnify a director, officer, has received total compensation in excessemployee or agent made a party to an action by reason of $100,000 in our fiscal years ended as of December 31, 2015 and December 31, 2016, respectively. Upon successful completion future funding, however, certain management personnel are entitled to receive the compensation as is discussed below in “Anticipated Officer and Director Remuneration”.
Eachthat fact that he was a director, officer employee or agent of the officers has received certain sharescorporation or was serving at the request of our common stock.
Other thanthe corporation against expenses actually and reasonably incurred by him in connection with such action if he acted in good faith and in a manner he reasonably believed to be in, or not opposed to, the best interests of the corporation and with respect to Ms. Madison,any criminal action, had no reasonable cause to believe his conduct was unlawful.
CONFLICTS OF INTEREST - GENERAL
Our sole director and officer is, or may become, in his individual capacities, an officer, director, controlling shareholder and/or partner of other entities engaged in a variety of businesses. Thus, there are no current plans to pay or distribute cash or non-cash bonus compensationexist potential conflicts of interest including, among other things, time, efforts, and corporation opportunity, involved in participation with such other business entities. While our sole officer and director of our business is engaged in business activities outside of our business, he devotes to our officers, untilbusiness such time as we are profitablehe believes to be necessary.
CONFLICTS OF INTEREST - CORPORATE OPPORTUNITIES
Presently no requirement contained in our Articles of Incorporation, Bylaws, or experience positive cash flow. However,minutes which requires officers and directors of our business to disclose to us business opportunities which come to their attention. Our officers and directors do, however, have a fiduciary duty of loyalty to us to disclose to us any business opportunities which come to their attention, in their capacity as an officer and/or director or otherwise. Excluded from this duty would be opportunities which the Boardperson learns about through his involvement as an officer and director of Directors may allocate salaries and benefits to the officers in its sole discretion. No officer is subject to a compensation plananother company. We have no intention of merging with or arrangement that resultsacquiring an affiliate, associate person or business opportunity from his or her resignation, retirement,any affiliate or any other terminationclient of employment with us or from a change in control of our company or a change in his or her responsibilities following a change in control. The members of the board of directors may receive, if the board of directors so decides, a fixed fee and reimbursement of expenses, for attendance at each regular or special meeting of the board of directors, although noany such program has been adopted to date. We do not currently have any retirement, pension, or profit-sharing plan covering our officers and directors; however, we plan to implement such benefits after sufficient funds are realized or raised by us (see “Anticipated Officer and Director Remuneration” below.)person.
Officer and Director RemunerationITEM 6: EXECUTIVE COMPENSATION
During the yearthree years ended December 31, 2016, we did not pay2020, 2019 and 2018, no salaries were paid to any compensation to our directors. We intend to pay annual salaries to all our officers and to pay an annual stipend to our directors when and if sufficient funds are realized. At such time, we anticipate offering cash and non-cash compensation to officers andor directors.
AlthoughExecutive compensation during the years ended December 31, 2020 and 2019 was as follows:
| Annual | Annual | Stock | All | Annual | ||||||||||||||||||||||||
| Payments | Payments | And | Compensation | Other | Compensation | |||||||||||||||||||||||
| Name/Position | Year | Salary | Made | Options(1) | Plans | Compensation | Total | |||||||||||||||||||||
| James F. O’Rourke | 2020 | $ | 0 | $ | 0 | 0 | 0 | 0 | $ | 0 | ||||||||||||||||||
| Chief Executive Officer | 2019 | $ | 0 | $ | 0 | $ | 11,700 | 0 | 0 | $ | 0 | |||||||||||||||||
| 2018 | $ | 0 | $ | 0 | 0 | 0 | 0 | $ | 0 | |||||||||||||||||||
| Arthur M. Read II, Esq. (2) | 2019 | $ | 0 | $ | 0 | $ | 7,500 | 0 | 0 | $ | 0 | |||||||||||||||||
| Vice President | 2018 | $ | 0 | $ | 0 | 0 | 0 | 0 | $ | 0 | ||||||||||||||||||
| Linda H. Madison (2) Principal Financial Officer and | 2019 | $ | 0 | $ | 0 | $ | 2,500 | 0 | 0 | $ | 0 | |||||||||||||||||
| Principal Accounting Officer | 2018 | $ | 0 | $ | 0 | 0 | 0 | 0 | $ | 0 | ||||||||||||||||||
| (1) | On September 18, 2019, the Company issued the following stock awards: Mr. O’Rourke-117,000,000 shares; Mr. Read-75,000,000 shares and Ms. Madison-25,000,000 shares. The shares were valued at $0.0001, the market price of the stock on the OTC Markets on that date. |
| (2) | On December 30, 2019, Mr. Read and Ms. Madison resigned as officers and directors of the Company |
Employment Agreement
We do not presently offered, we anticipate thathave any employment agreements with our officers and directors will be provided with a group health, vision and dental insurance program at subsidizes rates, or at our sole expense , as may be determined on a case-by-case basis by us in our sole discretion. In addition, we plan to offer 401(k) matching funds as a retirement benefit, paid vacation days and paid holidays.officers.
Stock Option Plan
Under the Company’s 2014 Stock Option Plan, no options have been granted
Outstanding Equity Awards at Fiscal Year-End
The following table sets forth information relating to equity awards outstanding at the end of December 31, 20162020 for each Named Executive Officer.
| Name | Grant Date | Number of Securities Underlying Unexercised Stock Awards | Number of Securities Underlying Unexercised Stock Awards Exercisable | Number of Securities Underlying Unexercised Stock Awards Unexercisable | Grant Date fair value of Restricted Stock Awards ($/share) | Grant Date | Number of Securities Underlying Unexercised Stock Awards | Number of Securities Underlying Unexercised Stock Awards Exercisable | Number of Securities Underlying Unexercised Stock Awards Unexercisable | Grant Date fair value of Restricted Stock Awards ($/share) | ||||||||||||||||||||||||||
| Arthur M. Read, II | 01/25/2016 | - | 30,000,000 | - | $ | 0.0002 | ||||||||||||||||||||||||||||||
| James F. O’Rourke | 09/18/2019 | 117,000,000 | $ | 0.0001 | ||||||||||||||||||||||||||||||||
| Arthur M. Read, II, Esq | 09/18/2019 | 75,000,000 | $ | 0.0001 | ||||||||||||||||||||||||||||||||
| Linda H. Madison | 09/18/2019 | 25,000,000 | $ | 0.0001 | ||||||||||||||||||||||||||||||||
Employee Pension, Profit Sharing or other Retirement Plans
We do not have a defined benefit, pension plan, profit sharing or other retirement plan, although we may adopt one or more of such plans in the future.
Director’s Compensation
At present we do not pay our directors for attending meetings of our Board of Directors, although we expect to adopt a director compensation policy by the end of the current year.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.
The following table sets forth information as of the date of this report regarding the beneficial ownership of the Company’s common stock by each of its executive officers and directors, individually and as a group and by each person who beneficially owns in excess of five percent of the common stock.
| Number of Shares of | ||||||||||
| Name | Position | Common Stock | Percent of Class(1) | |||||||
| James F. O’Rourke | Chief Executive Officer | 90,825,000 | 5.9 | |||||||
| Arthur M. Read, II, Esq. | Executive Vice President, General Counsel and Director | 120,000,000 | 7.9 | |||||||
| John M. Faulhaber | Chairman of the Board | 1,000,000 | * | |||||||
| Robert C. Hemsen | Vice Chairman of the Board | 6,010,000 | * | |||||||
| Linda H. Madison | Secretary | 90,000,000 | 5.9 | |||||||
| Total owned by officers and directors (5) | 307,835,000 | 20.15 | % | |||||||
* Less than 1%
ITEM 13.7: CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE
During the year ended December 31, 2016 we entered into 7 promissory notes with two related parties with the principal amount totaling $29,205 and received2020 the total related partyamount of loan proceeds of $29,205. At December 31, 2016 and 2015, we owed an aggregate of $400,810 to related parties in accordance withwas $-0- from the terms of notes that we issued.Company’s President. The total interest accrued on related partyPresident’s loans aton December 31, 20162020 and December 31, 20152019 was $56,777$-0- and $29,467,$-0-, respectively.
Before the Company became public, $11,321 was advanced to one stockholder. In the 1st quarter of 2016 this advance was deemed uncollectible and therefore written off to bad debt expense. From time to time, we receive payments from stockholders in the form of cash and/or out-of-pocket expenditures for the benefit of the Company, which are business in nature. On December 11, 2018 we received a loan from a stockholder in the amount of $13,500, to be repaid in monthly installments of principal and interest beginning March 25, 2019. The balance of this loan as of December 31, 2020 was $13,080. The interest expense on this loan as of December 31, 2020 was $2,140.
The balance of advances to stockholderrelated parties as of December 31, 20162020 and December 31, 20152019 was $-0- and $11,321,$-0-, respectively. During the year ended December 31, 2020 a related party advanced the Company $54,900. Amounts accrued, but not yet paid as due to related party at December 31, 20162020 and December 31, 20152019 was $25,000$93,900 and $25,000,$39,000, respectively.
We obtained financing from five different related parties from 2012 through December 31, 2016. As of December 31, 2016, 82.61% of the short-term financing is from Arthur Read. The accrued interest payable to Mr. Read is $44,951. The following are breakdowns for the promissory notes issued to all five related parties.
We obtained financing from a related party in the form of three demand Notes Payable in the aggregate amount of $10,000 which have been outstanding since the year ended December 31, 2012. All three notes have been amended, extending the maturity dates. See maturity dates on table below. The Notes bear an interest rate of 7% per annum and are unsecured.
| Note | Principal | Rate | Accrued interest | Maturity | |||||||||||||||
| 12/31/16 | 12/31/15 | ||||||||||||||||||
| Promissory note 1 | $ | 6,000 | 7 | % | $ | 1,816 | $ | 1,395 | 9/4/2018 | ||||||||||
| Promissory note 2 | $ | 2,000 | 7 | % | $ | 594 | $ | 454 | 10/1/2017 | ||||||||||
| Promissory note 3 | $ | 2,000 | 7 | % | $ | 571 | $ | 430 | 12/3/2017 | ||||||||||
| Total | $ | 10,000 | $ | 2,981 | $ | 2,279 | |||||||||||||
| 13 |
Employee Benefit Plans
We obtained financing fromhave no employee benefit plans or stock option plans.
Neither we nor any of our officers, directors, or holders of five percent or more of its common stock is a related party to any pending legal proceedings and to the best of our knowledge, no such proceedings by or against us or our officers, or directors or holders of five percent or more of its common stock have been threatened or is pending against us.
ITEM 9: MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT’S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
Item 5. Market for Registrant’s Common Equity Related Stockholder Matters and Issuer Purchases of Equity Securities.
Market Information
Market Information
The trading in the Company’s Common Stock began on November 13, 2012. The Securities and Exchange Commission has adopted Rule 15g-9 which establishes the definition of a “penny stock,” for purposes relevant to the Company, as any equity security that has a market price of less than $5.00 per share or with an exercise price of less than $5.00 per share, subject to certain exceptions. For any transaction involving a penny stock, unless exempt, the rules require: (i) that a broker or dealer approve a person’s account for transactions in penny stocks and (ii) the broker or dealer receive from the investor a written agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased. In order to approve a person’s account for transactions in penny stocks, the broker or dealer must (i) obtain financial information and investment experience and objectives of the person and (ii) make a reasonable determination that the transactions in penny stocks are suitable for that person and that person has sufficient knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks. The broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prepared by the Commission relating to the penny stock market, which, in highlight form, (i) sets forth the basis on which the broker or dealer made the suitability determination and (ii) that the broker or dealer received a signed, written agreement from the investor prior to the transaction. Disclosure also has to be made about the risks of twenty-one demand Notes Payableinvesting in penny stocks in both public offerings and in secondary trading, and about commissions payable to both the broker-dealer and the registered representative, current quotations for the securities and the rights and remedies available to an investor in cases of fraud in penny stock transactions. Finally, monthly statements have to be sent disclosing recent price information for the penny stock held in the aggregate amountaccount and information on the limited market in penny stocks.
Because of $331,101 duringthese regulations, broker-dealers may encounter difficulties in their attempt to buy or sell shares of our common stock, which may affect the period fromability of our shareholders to sell their shares in the secondary market and have the effect of reducing the level of trading activity in the secondary market. These additional sales practice and disclosure requirements could impede the sale of our common stock in the marketplace. In addition, the liquidity for our common stock may be decreased, with a corresponding decrease in the price of our common stock. Our shares are likely to be subject to such penny stock rules for the foreseeable future.
On November 13, 2012, through December 31, 2015. We repaidour common stock was approved for quotation on the OTC Markets under the symbol “PWDY”. The OTC Markets is a totalregulated quotation service that displays real-time quotes, last-sale prices, and volume information in over-the-counter equity securities. The OTC Markets securities are traded by a community of $2,353market makers that enter quotes and trade reports. This market is limited in comparison to the national stock exchanges and any prices quoted may not be a reliable indication of the principal on Note 7value of our common stock.
The following table sets forth the range of the high and low sales prices of our common stock for each of the calendar quarters during the years ended December 31, 20142020 and December 31, 2015. Several2019.
| OTC Bulletin Board | High | Low | ||||||
| Year Ended December 31, 2018 | ||||||||
| 1st Quarter | $ | 0.0005 | $ | 0.0002 | ||||
| 2nd Quarter | $ | 0.0005 | $ | 0.0003 | ||||
| 3rd Quarter | $ | 0.0007 | $ | 0.0002 | ||||
| 4th Quarter | $ | 0.0006 | $ | 0.0003 | ||||
| Year Ended December 31, 2019 | ||||||||
| 1st Quarter | $ | 0.0002 | $ | 0.0001 | ||||
| 2nd Quarter | $ | 0.0011 | $ | 0.0002 | ||||
| 3rd Quarter thru September 30 | $ | 0.0038 | $ | 0.0001 | ||||
On September 30, 2019, the SEC, pursuant to Section 12(j), revoked the Company registration under Section 12 of the notesSecurities Act of 1933, as amended. Accordingly, the Company’s common stock has not traded since that date. The company is currently working with a broker/dealer and FINRA to have been amended and extended duringits common stock commence trading shortly after the period from 2014 through December 31, 2016. See maturity dueseffectiveness of this Form 10. The last price of our common stock as quoted on table below. The Notes bear an interest rate of 7% per annum and are unsecured.the OTC Bulletin Board on September 30, 2019 was $0 .0004.
| Note | Principal | Rate | Accrued interest | Maturity | |||||||||||||||
| 12/31/16 | 12/31/15 | ||||||||||||||||||
| Promissory note 1 | $ | 5,000 | 7 | % | $ | 1,522 | $ | 1,171 | 7/25/2018 | ||||||||||
| Promissory note 2 | $ | 11,000 | 7 | % | $ | 3,228 | $ | 2,456 | 10/22/2017 | ||||||||||
| Promissory note 3 | $ | 15,000 | 7 | % | $ | 4,306 | $ | 3,254 | 11/24/2017 | ||||||||||
| Promissory note 4 | $ | 102 | 7 | % | $ | 30 | $ | 23 | 10/22/2017 | ||||||||||
| Promissory note 5 | $ | 879 | 7 | % | $ | 252 | $ | 191 | 11/24/2017 | ||||||||||
| Promissory note 6 | $ | 973 | 7 | % | $ | 296 | $ | 228 | 7/25/2018 | ||||||||||
| Promissory note 7 | $ | 22,147 | 7 | % | $ | 4,305 | $ | 2,750 | 5/4/2017 | ||||||||||
| Promissory note 8 | $ | 7,000 | 7 | % | $ | 1,010 | $ | 518 | 12/11/2018 | ||||||||||
| Promissory note 9 | $ | 6,000 | 7 | % | $ | 853 | $ | 432 | 12/22/2018 | ||||||||||
| Promissory note 10 | $ | 25,000 | 7 | % | $ | 3,471 | $ | 1,716 | 1/8/2017 | ||||||||||
| Promissory note 11 | $ | 35,000 | 7 | % | $ | 4,672 | $ | 2,215 | 2/5/2017 | ||||||||||
| Promissory note 12 | $ | 40,000 | 7 | % | $ | 4,864 | $ | 2,056 | 4/8/2017 | ||||||||||
| Promissory note 13 | $ | 30,000 | 7 | % | $ | 3,492 | $ | 1,387 | 5/5/2017 | ||||||||||
| Promissory note 14 | $ | 45,000 | 7 | % | $ | 4,807 | $ | 1,648 | 6/24/2017 | ||||||||||
| Promissory note 15 | $ | 25,000 | 7 | % | $ | 2,508 | $ | 753 | 7/28/2017 | ||||||||||
| Promissory note 16 | $ | 15,000 | 7 | % | $ | 1,438 | $ | 385 | 8/20/2017 | ||||||||||
| Promissory note 17 | $ | 13,000 | 7 | % | $ | 1,167 | $ | 254 | 9/21/2017 | ||||||||||
| Promissory note 18 | $ | 5,000 | 7 | % | $ | 439 | $ | 88 | 10/13/2017 | ||||||||||
| Promissory note 19 | $ | 10,000 | 7 | % | $ | 823 | $ | 121 | 10/30/2017 | ||||||||||
| Promissory note 20 | $ | 3,000 | 7 | % | $ | 220 | $ | 10 | 12/15/2017 | ||||||||||
| Promissory note 21 | $ | 17,000 | 7 | % | $ | 1,249 | $ | 55 | 12/15/2017 | ||||||||||
| Total | $ | 331,101 | $ | 44,951 | $ | 21,711 | |||||||||||||
Dividend Policy
We obtained financing from a related partyhave never paid nor declared any cash dividends on our common stock to date, and do not anticipate paying such cash dividends in the foreseeable future. Whether we declare and pay dividends is determined by our Board of Directors at their discretion, subject to certain limitations imposed under Delaware corporate law. The timing, amount and form of six demand Notes Payable in the aggregate amountdividends, if any, will depend on, among other things, our results of $9,409 during the period from 2012 through December 31, 2016. Notes 1 - 4 were amendedoperations, financial condition, cash requirements and extended. See maturity dates on table below. The Notes bear an interest rateother factors deemed relevant by our Board of 7% per annum and are unsecured.Directors.
Equity Compensation Plan Information
| Note | Principal | Rate | Accrued interest | Maturity | |||||||||||||||
| 12/31/16 | 12/31/15 | ||||||||||||||||||
| Promissory note 1 | $ | 234 | 7 | % | $ | 67 | $ | 50 | 12/5/2017 | ||||||||||
| Promissory note 2 | $ | 170 | 7 | % | $ | 49 | $ | 37 | 11/18/2017 | ||||||||||
| Promissory note 3 | $ | 4,100 | 7 | % | $ | 1,120 | $ | 833 | 2/5/2018 | ||||||||||
| Promissory note 4 | $ | 2,000 | 7 | % | $ | 546 | $ | 405 | 2/7/2018 | ||||||||||
| Promissory note 5 | $ | 1,780 | 7 | % | $ | 95 | $ | - | 3/29/2018 | ||||||||||
| Promissory note 6 | $ | 1,125 | 7 | % | $ | 40 | $ | - | 6/30/2018 | ||||||||||
| Total | $ | 9,409 | $ | 1,917 | $ | 1,325 | |||||||||||||
Our board of directors adopted the 2014 Stock Option Plan (the “Plan”) in 2014 to promote our long-term growth and profitability by (i) providing our key directors, officers and employees with incentives to improve stockholder value and contribute to our growth and financial success and (ii) enable us to attract, retain and reward the best available persons for positions of substantial responsibility. A total of 100,000,000 shares of our common stock have been reserved for issuance upon exercise of options granted pursuant to the Plan. The Plan allows us to grant options to our employees, officers and directors and those of our subsidiaries, provided that only our employees and those of our subsidiaries may receive incentive stock options under the Plan. We have granted a total of 0 shares of stock as of December 31, 2020 under the Plan.
Holders
There are approximately 45 active holders of the Company’s Common Stock. This figure does not include holders of shares registered in “street name” or persons, partnerships, associates, corporations, or other entities identified in security position listings maintained by depositories.
Dividends
We have not declared any cash dividends on our common stock since our inception and do not anticipate paying any dividends in the foreseeable future. We plan to retain future earnings, if any, for use in our business. Any decisions as to future payments of dividends will depend on our earnings and financial position and such other facts, as the Board of Directors deems relevant.
Shares Available for Future Sale
Approximately 50.7% of all outstanding shares of our common stock are “restricted securities,” as that term is defined under Rule 144 promulgated under the Securities Act, because they were issued in a private transaction not involving a public offering. Accordingly, none of the outstanding shares of our common stock may be resold, transferred, pledged as collateral or otherwise disposed of unless such transaction is registered under the Securities Act or an exemption from registration is available. In connection with any transfer of shares of our common stock other than pursuant to an effective registration statement under the Securities Act, the Company may require the holder to provide to the Company an opinion of counsel to the effect that such transfer does not require registration of such transferred shares under the Securities Act.
Rule 144 is not available for the resale of securities initially issued by companies that are, or previously were, shell companies, unless the following conditions are met:
| ● | the issuer of the securities that was formerly a shell Company has ceased to be a shell Company; |
| ● | the issuer of the securities is subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act; |
| ● | the issuer of the securities has filed all Exchange Act reports and material required to be filed, as applicable, during the preceding 12 months (or such shorter period that the issuer was required to file such reports and materials), other than Current Reports on Form 8-K; and |
| ● | at least one year has elapsed from the time that the issuer filed current comprehensive disclosure with the SEC reflecting its status as an entity that is not a shell Company. |
Reports to Security Holders
The Company’s documents filed with the Securities and Exchange Commission may be inspected at the Commission’s principal office in Washington, D.C. Copies of all or any part of the registration statement may be obtained financing from the Public Reference Section of the Securities and Exchange Commission, 100 F Street N.E., Washington, D.C. 20549. Call the Commission at 1-800-SEC-0330 for further information on the operation of the public reference rooms. The Securities and Exchange Commission also maintains a web site at http://www.sec.gov that contains reports, proxy statements and information regarding registrants that file electronically with the Commission. All of the Company’s filings may be located under the CIK number 000- 1435617.
Transfer Agent
VStock Transfer, LLC, located at 18 Lafayette Place, New York 11598 is the registrar and transfer agent for the Company’s common stock.
Repurchases of Equity Securities
None
Options and Warrants
None of the shares of our Common Stock are subject to outstanding options or warrants.
ITEM 10: RECENT SALES OF UNREGISTERED SECURITIES
Stock issued for services
All of the services rendered to the company as set forth below were rendered as of the recent balance sheet
On September 18, 2019, the Company issued 10,000,000 shares to a consulting company as compensation for public relation services ended October 2019. The company valued the stock at $0.0001, for a total of $1,000.
On September 18, 2019, the Company issued 25,000,000 shares to a consultant as compensation for financial statement services rendered. The Company valued the stock at $0.0001, for a total of $2,500.
On September 18, 2019, the Company issued 10,000,000 shares to a stockholder as compensation for business strategy services rendered. The Company valued the stock at $0.0001, for a total of $1,000.
On September 18, 2019, the Company issued 5,000,000 shares to a consultant as compensation for legal services rendered. The Company valued the stock at $0.0001, for a total of $500.
On September 18, 2019, the Company issued 25,000,000 shares to a consultant as compensation for IT services rendered/to be rendered. The Company valued the stock at $0.0001, for a total of $2,500.
On September 18, 2019, the Company issued 22,000,000 shares to a stockholder as compensation for accounting software services rendered. The Company valued the stock at $0.0001, for a total of $2,200.
On September 18, 2019, the Company issued 23,000,000 shares to a stockholder as compensation for accounting services rendered. The Company valued the stock at $0.0001, for a total of $2,300.
Common stock issued in exchange for debt
On September 18, 2019, the Company issued 117,000,000 shares in exchange for the extinguishment of $11,700 of debt held by a related party in the form of two demand Notes Payable in the aggregate amount of $18,000 during the year of 2013. Both notes were amended and extended during the quarter ended March 31, 2016. See maturity dates on table below. The Notes bear an interest rate of 7% per annum and are unsecured.party.
| Note | Principal | Rate | Accrued interest | Maturity | |||||||||||||||
| 12/31/16 | 12/31/15 | ||||||||||||||||||
| Promissory note 1 | $ | 10,000 | 7 | % | $ | 2,702 | $ | 2,000 | 2/21/2018 | ||||||||||
| Promissory note 2 | $ | 8,000 | 7 | % | $ | 2,123 | $ | 1,562 | 3/18/2018 | ||||||||||
| Total | $ | 18,000 | $ | 4,826 | $ | 3,562 | |||||||||||||
We obtained financing fromOn September 18, 2019, the Company issued 75,000,000 shares in exchange for the extinguishment of $7,500 debt held by a related party in the form of six demand Note Payables in the aggregate amount of $32,300 during the period from 2014 through December 31, 2016. The Notes bears an interest rate of 7% per annum and are unsecured.party.
On September 18, 2019, the Company issued 50,000,000 shares in exchange for the extinguishment of $5,000 of debt held by a related party.
| Note | Principal | Rate | Accrued interest | Maturity | |||||||||||||||
| 12/31/16 | 12/31/15 | ||||||||||||||||||
| Promissory note 1 | $ | 6,000 | 7 | % | $ | 1,011 | $ | 590 | 8/6/2018 | ||||||||||
| Promissory note 2 | $ | 2,500 | 7 | % | $ | 174 | $ | - | 1/4/2018 | ||||||||||
| Promissory note 3 | $ | 4,200 | 7 | % | $ | 242 | $ | - | 2/5/2018 | ||||||||||
| Promissory note 4 | $ | 3,000 | 7 | % | $ | 165 | $ | - | 3/20/2018 | ||||||||||
| Promissory note 5 | $ | 11,500 | 7 | % | $ | 406 | $ | - | 6/30/2018 | ||||||||||
| Promissory note 6 | $ | 5,100 | 7 | % | $ | 106 | $ | - | 8/8/2018 | ||||||||||
| Total | $ | 32,300 | $ | 2,104 | $ | 590 | |||||||||||||
On September 18, 2019, the Company issued 25,000,000 shares in exchange for the extinguishment of $2,500 debt held by a related party.
The securities set forth above were issued pursuant to Section 4(2) of the Securities Act and/or Rule 506 promulgated thereunder. The holders represented their intention to acquire the securities for investment only and not with a view towards distribution. The investors were given adequate information about us to make an informed investment decision. We did not engage in any general solicitation or advertising. We directed our transfer agent to issue the stock certificates with the appropriate restrictive legend affixed to the restricted stock.
Promissory Notes
Between 2012 and December 31, 2019, related parties loaned approximately $609,585 to the Company. On December 31, 2019, pursuant to agreements between the Company and the related parties, except for approximately $50,000, all loans owed to related parties, including interest thereon, were extinguished.
During the year ended December 31, 20162020 the total amount of related party loan proceeds was $29,205.$-0-. The total interest accrued on related party loans on December 31, 2020 and December 31, 2019 was $-0- and $131,153, respectively.
From time to time, we receive payments from stockholders in the form of cash and/or out-of-pocket expenditures for the benefit of the Company, which are business in nature. On December 11, 2018 we received a loan from a stockholder in the amount of $13,500, to be repaid in monthly installments of principal and interest beginning March 25, 2019. The balance of this loan as of December 31, 2020 was $13,080. The interest expense on this loan as of December 31, 2020 was $2,140.
The balance of advances to related parties as of December 31, 2020 and December 31, 2019 was $-0- and $-0-, respectively. During the year ended December 31, 2020 a related party advanced the Company $54,900. Amounts accrued, but not yet paid as due to related party at December 31, 20162020 and December 31, 20152019 was $56,777$93,900 and $29,467,$39,000, respectively.
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.11: DESCRIPTION OF REGISTRANT’S SECURITIES TO BE REGISTERED
Audit FeesDescription of Common Stock
The aggregate fees incurred for eachWe are authorized to issue 2,000,000,000 shares of our Common Stock, $0.0001 par value (the “Common Stock”). Each share of the last two yearsCommon Stock is entitled to share equally with each other share of Common Stock in dividends from sources legally available therefore, when, and if, declared by our board of directors and, upon our liquidation or dissolution, whether voluntary or involuntary, to share equally in the assets of the Company that are available for professional services rendereddistribution to the holders of the Common Stock. Each holder of Common Stock is entitled to one vote per share for all purposes, except that in the election of directors, each holder shall have the right to vote such number of shares for as many persons as there are directors to be elected. Cumulative voting shall not be allowed in the election of directors or for any other purpose, and the holders of Common Stock have no pre-emptive rights, redemption rights or rights of conversion with respect to the Common Stock. Our board of directors is authorized to issue additional shares of our Common Stock within the limits authorized by our Articles of Incorporation and without stockholder action. All shares of Common Stock have equal voting rights, and voting rights are not cumulative.
A total of 1,914,903,584 shares of common stock are currently outstanding on the date of this Form 10 K
PREFERRED STOCK
Preferred Stock in General
We are authorized to issue 20,000,000 shares of Preferred Stock, par value $.0001, from time to time in one or more series. The Board of Directors is authorized to fix the number of shares of any series of Preferred Stock and to determine the designation of any such series. The Board of Directors is also authorized to determine or alter the rights, preferences, privileges, and restrictions granted to or imposed upon any wholly unissued series of Preferred Stock and, within the limits and restrictions stated in any resolution or resolutions of the Board of Directors originally fixing the number of shares constituting any series, to increase or decrease (but not below the number of shares of such series than outstanding) the number of shares of any such series subsequent to the issue of shares of that series. Currently there are 2,000,000 shares of Series A Preferred Stock, par value $.0001, designated.
Series A Preferred Stock
Shares of our Series A Preferred Stock do not rank senior to our common stock as to dividends and distributions. The holders of outstanding shares of Series A Preferred Stock are not entitled to receive any dividends and in the event of voluntary or involuntary liquidation, dissolution or winding op of the Corporation, the holders of the Series A Preferred Stock are not entitled to receive any assets of the Company.
Holders of Series A Preferred Stock are entitled to 1,000 non-cumulative votes per share on all matters presented to our stockholders for action. This right could adversely affect the voting power of the holders of common stock and could have the effect of making it more difficult for a third party to acquire or could discourage or delay a third party from acquiring, a majority of our outstanding stock. In addition, the affirmative vote of the holders of a majority of the Series A Preferred Stock then outstanding, shall vote together with the holders of Common Stock on all matters and shall not vote as a separate class for Powerdyne to do any of the following:
| ● | amend, alter or repeal any of the preferences or rights of the Series A Preferred Stock; | |
| ● | authorize any reclassification of the Series A Preferred Stock; | |
| ● | increase the authorized number of shares of the Series A Preferred Stock; or | |
| ● | create any Series or series of shares ranking prior to the Series A Preferred Stock as to dividends or upon liquidation. |
Series A Preferred Stock does not convert into common stock of the Company.
Shares of Series A Preferred Stock are not entitled to pre-emptive rights nor are they redeemable by the independent registered public accounting firmCompany.
Currently no shares of Series A Preferred Stock are issued or outstanding on the date of this Form 10 registration statement.
ITEM 12: INDEMNIFICATION OF DIRECTORS AND OFFICERS
Our articles provide to the fullest extent permitted by Delaware Law that our directors or officers shall not be personally liable to the Company or our stockholders for damages for breach of such directors or officers fiduciary duty. The effect of this provision of our articles is to eliminate our rights and the auditsrights of our stockholders (through stockholders’ derivative suits on behalf of the Company's annual financial statementsCompany) to recover damages against a director or officer for breach of the fiduciary duty of care as a director or officer (including breaches resulting from negligent or grossly negligent behavior), except under certain situations defined by statute. We believe that the indemnification provisions in our articles are necessary to attract and reviewretain qualified persons as directors and officers.
Delaware corporate law provides that a corporation may indemnify a director, officer, employee or agent made a party to an action by reason of financial statements included inthat fact that he was a director, officer employee or agent of the Company's Form 10-Kcorporation or was serving at the request of the corporation against expenses actually and Form 10-Q reports and services normally providedreasonably incurred by him in connection with statutorysuch action if he acted in good faith and regulatory filingsin a manner he reasonably believed to be in, or engagements were as follows:not opposed to, the best interests of the corporation and with respect to any criminal action, had no reasonable cause to believe his conduct was unlawful.
| December 31, 2015 | December 31, 2016 | |||||
| $ | 22,560 | $ | 23,100 | |||
Tax FeesITEM 13: FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The Company incurred $0 for tax related services.
All Other Fees
The Company incurred $0 for other fees by the principal accountantOur audited financial statements for the years ended December 31, 20162020 and 2015.
The Company does not currently have an audit committee serving and as a result its board2019 appear at the end of directors performs the duties of an audit committee. The board of directors will evaluate and approve in advance, the scope and cost of the engagement of an auditor before the auditor renders audit and non-audit services. The Company does not relythis statement on preapproval policies and procedures.
ITEM 15. EXHIBITS,14: CHANGES IN AND DISAGREEMENTS WITH INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM ON ACCOUNTING AND FINANCIAL STATEMENT SCHEDULESDISCLOSURE
On August 6, 2020, we appointed B F Borgers, CPA PC as our new independent auditors. | |
There has never been any disagreement with any independent registered public accounting firm that has worked for the Company regarding accounting and financial disclosure.
ITEM 15: FINANCIAL STATEMENTS, AND EXHIBITS
(a) Financial Statements
Our audited financial statements for the years ended December 31, 2020 and 2019 and appear at the end of this statement on pages F-1 though F-37.
(b) Exhibits
See the Exhibit Index beginning following the signature page.
Pursuant to the requirements of Section 13 or 15(d) 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.
| POWERDYNE INTERNATIONAL, | ||
| By: | /s/ James F. O’Rourke | |
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacitiescapacity and on the dates indicated.
| /s/ James F. O’Rourke | ||||
| James F. O’Rourke | ||||
Copies of the following documents are included as exhibits to this registration statement.
| 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 |
** Filed herewith
| 20 |
FINANCIAL STATEMENTS
TABLE OF CONTENTS
AUDITED FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019
POWERDYNE INTERNATIONAL, INC.
FINANCIAL STATEMENTS
December 31, 2016 and 2015
INDEX TO FINANCIAL STATEMENTS
Report of Independent Registered Public Accounting Firm
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Boardshareholders and the board of Directors
directors of Powerdyne International, IncInc.
Opinion on the Financial Statements
We have audited the accompanying balance sheets of Powerdyne International, Inc (the "Company")Inc. as of December 31, 20162020 and 2015, and2019, the related statementstatements of operations, changes in stockholders’ deficitequity (deficit), and cash flows for the years then ended. These financial statements areended, and the responsibility ofrelated notes (collectively referred to as the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States of America)“financial statements”). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company was not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits 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 Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 20162020 and 20152019, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United StatesStates.
Basis for Opinion
These financial statements are the responsibility of America.the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.
Substantial Doubt about the Company’s Ability to Continue as a Going Concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 4 to the financial statements, the Company has had minimal revenuessuffered recurring losses from operations and has ana significant accumulated deficit of $3,374,003.deficit. In addition, the Company continues to experience negative cash flows from operations. These conditions, among others,factors raise substantial doubt about the Company’s ability to continue as a going concern. Management'sManagement’s plans concerningin regard to these matters are also described in the Note 4, which include the raising of additional equity financing.4. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/ Anton & Chia, LLPS/ BF Borgers CPA PC
Newport Beach, CaliforniaBF Borgers CPA PC
April 13, 2017We have served as the Company’s auditor since 2020
Lakewood, CO
March 30, 2021
BALANCE SHEETS
(Audited)
| December 31, 2016 | December 31, 2015 | December 31, 2020 | December 31, 2019 | |||||||||||||
| restated | ||||||||||||||||
| ASSETS | ||||||||||||||||
| Current Assets: | ||||||||||||||||
| Cash | $ | 72 | $ | 1,922 | $ | 768 | $ | 8,855 | ||||||||
| Asset held for sale | 4,787 | 1,266 | ||||||||||||||
| Advances to stockholder | - | 11,321 | - | - | ||||||||||||
| Total current assets | 72 | 13,243 | 5,555 | 10,121 | ||||||||||||
| Property and Equipment | ||||||||||||||||
| Property and equipment, net | 34,296 | 79,031 | ||||||||||||||
| Cryptocurrency miners | $ | 15,000 | $ | 15,000 | ||||||||||||
| Less: accumulated depreciation | (6,000 | ) | (3,000 | ) | ||||||||||||
| Total property and equipment | 9,000 | 12,000 | ||||||||||||||
| Total Assets | $ | 34,368 | $ | 92,274 | $ | 14,555 | $ | 22,121 | ||||||||
| LIABILITIES AND STOCKHOLDERS' DEFICIT | ||||||||||||||||
| LIABILITIES AND STOCKHOLDERS’ DEFICIT | ||||||||||||||||
| Current Liabilities: | ||||||||||||||||
| Accounts payable and accrued expenses | $ | 135,502 | $ | 68,877 | $ | 18,737 | $ | 26,487 | ||||||||
| Due to related parties | 25,000 | 25,000 | 93,900 | 39,000 | ||||||||||||
| Notes payable-related parties | 316,532 | 371,605 | ||||||||||||||
| Note payable-stockholder | 13,080 | 10,940 | ||||||||||||||
| Income tax payable | 1,000 | 500 | 2,550 | 2,150 | ||||||||||||
| Total Current Liabilities | 478,034 | 465,982 | 128,267 | 78,577 | ||||||||||||
| Long Term Liabilities | ||||||||||||||||
| Notes payable-related parties | 84,278 | - | ||||||||||||||
| Total Long Term Liabilities | 84,278 | - | ||||||||||||||
| Total Liabilities | 562,312 | 465,982 | 128,267 | 78,577 | ||||||||||||
| Stockholders' Deficit: | ||||||||||||||||
| Common stock; $0.0001 par value; 2,000,000,000 sharesauthorized, 1,527,930,584 shares issued and outstandingas of December 31, 2016 and 1,379,430,584 shares issued andoutstanding as of December 31, 2015 | 152,793 | 137,943 | ||||||||||||||
| Stockholders’ Deficit: | ||||||||||||||||
| Preferred stock, $0.0001 par value, 20,000,000 shares authorized, -0- shares issued and outstanding as of December 31, 2020 and December 31, 2019 | - | - | ||||||||||||||
| Common stock, $0.0001 par value, 2,000,000,000 shares authorized, 1,914,930,584 shares issued and outstanding as of December 31, 2020 and 1,914,930,584 shares issued and outstanding as of December 31, 2019 | 191,493 | 191,493 | ||||||||||||||
| Additional paid-in capital | 2,693,266 | 2,678,066 | 3,302,851 | 3,302,851 | ||||||||||||
| Accumulated deficit | (3,374,003 | ) | (3,189,717 | ) | (3,608,056 | ) | (3,550,800 | ) | ||||||||
| Total Stockholders' Deficit | (527,944 | ) | (373,708 | ) | ||||||||||||
| Total Stockholders’ Deficit | (113,712 | ) | (56,456 | ) | ||||||||||||
| Total Liabilities and Stockholders' Deficit | $ | 34,368 | $ | 92,274 | ||||||||||||
| Total Liabilities and Stockholders’ Deficit | $ | 14,555 | $ | 22,121 | ||||||||||||
The accompanying notes are an integral part of these audited financial statements.statements
STATEMENTS OF OPERATIONS
(Audited)
| For the year | For the year | |||||||||||||||
| ended | ended | |||||||||||||||
| For the year ended | For the year ended | December 31, 2020 | December 31, 2019 | |||||||||||||
| December 31, 2016 | December 31, 2015 | restated | ||||||||||||||
| Revenues | $ | 488 | $ | 752 | $ | 3,521 | $ | 8,378 | ||||||||
| Cost of revenues | - | - | 3,000 | 3,000 | ||||||||||||
| Gross profit | 488 | 752 | 521 | 5,378 | ||||||||||||
| Operating expenses | 166,165 | 407,101 | 55,237 | 25,793 | ||||||||||||
| Loss from operations | (165,677 | ) | (406,349 | ) | (54,716 | ) | (20,415 | ) | ||||||||
| Other (Income) Expense | ||||||||||||||||
| Loss on sale of equipment | 18,109 | - | ||||||||||||||
| Derivative expense | - | 43,877 | ||||||||||||||
| Change in fair value of derivative | - | (50,345 | ) | |||||||||||||
| Amortization of debt discount | - | 138,260 | ||||||||||||||
| Other Expense | ||||||||||||||||
| Other Expense-Interest | 2,140 | (40,111 | ) | |||||||||||||
| Total Other Expense | 18,109 | 131,792 | 2,140 | (40,111 | ) | |||||||||||
| Loss before income tax expense | (183,786 | ) | (538,141 | ) | (56,856 | ) | (60,527 | ) | ||||||||
| Income tax expense | 500 | 919 | ||||||||||||||
| Income tax expense (Income) | 400 | (150 | ) | |||||||||||||
| Net loss | $ | (184,286 | ) | $ | (539,060 | ) | $ | (57,256 | ) | $ | (60,677 | ) | ||||
| Basic and diluted loss per common share | (0 | ) | (0 | ) | $ | 0.00 | $ | 0.00 | ||||||||
| Basic and diluted weighted average common shares outstanding | 1,517,448,344 | 963,014,524 | 1,914,930,584 | 1,638,199,077 | ||||||||||||
The accompanying notes are an integral part of these audited financial statements.
STATEMENTS OF STOCKHOLDERS’CHANGES IN STOCKHOLDER’S DEFICIT
(Audited)
| Additional | Total Stockholders' | |||||||||||||||||||
| Common Stock | Paid-In | Accumulated | Equity | |||||||||||||||||
| Shares | Amount | Capital | Deficit | (Deficit) | ||||||||||||||||
| Balance, December 31, 2014 | 369,135,575 | 36,913 | 1,985,268 | (2,650,658 | ) | (628,477 | ) | |||||||||||||
| Settlement of derivative liability through conversion of notes payable | 454,267 | 454,267 | ||||||||||||||||||
| Stock issued for services | 279,600,000 | 27,960 | 111,840 | - | 139,800 | |||||||||||||||
| Common stock issued in exchange for debt | 730,695,009 | 73,070 | 126,691 | 199,761 | ||||||||||||||||
| Net loss for the period | (539,060 | ) | (539,060 | ) | ||||||||||||||||
| Balance, December 31, 2015 | 1,379,430,584 | 137,943 | 2,678,066 | (3,189,717 | ) | (373,708 | ) | |||||||||||||
| Stock issued for services | 148,500,000 | 14,850 | 15,200 | - | 30,050 | |||||||||||||||
| Net loss for the period | (184,286 | ) | (184,286 | ) | ||||||||||||||||
| Balance, December 31, 2016 | 1,527,930,584 | 152,793 | 2,693,266 | (3,374,003 | ) | (527,944 | ) | |||||||||||||
| Additional | Total Stockholders’ | |||||||||||||||||||
| Common Stock | Paid-In | Accumulated | Equity | |||||||||||||||||
| Shares | Amount | Capital | Deficit | (Deficit) | ||||||||||||||||
| Balance, December 31, 2017 | 1,527,930,584 | 152,793 | 2,693,266 | (3,446,081 | ) | (600,022 | ) | |||||||||||||
| Net loss for the period | (44,042 | ) | (44,042 | ) | ||||||||||||||||
| Balance, December 31, 2018 | 1,527,930,584 | 152,793 | 2,693,266 | (3,490,123 | ) | (644,064 | ) | |||||||||||||
| Extinguishment of related party debt | 609,585 | 609,585 | ||||||||||||||||||
| Common stock issued for services | 120,000,000 | 12,000 | - | - | 12,000 | |||||||||||||||
| Common stock issued in exchange for reduction of debt | 267,000,000 | 26,700 | - | 26,700 | ||||||||||||||||
| Net loss for the period | (60,677 | ) | (60,677 | ) | ||||||||||||||||
| Balance, December 31, 2019 | 1,914,930,584 | 191,493 | 3,302,851 | (3,550,800 | ) | (56,456 | ) | |||||||||||||
| Net income for the period | (57,256 | ) | (57,256 | ) | ||||||||||||||||
| Balance, December 31, 2020 | 1,914,930,584 | 191,493 | 3,302,851 | (3,608,056 | ) | (113,712 | ) | |||||||||||||
The accompanying notes are an integral part of these audited financial statements.
POWERDYNE INTERNATIONAL, INC.
STATEMENTS OF CASH FLOWS
(Audited)
| For the year | For the year | |||||||
| ended | ended | |||||||
| December 31, 2020 | December 31, 2019 | |||||||
| Operating Activities: | ||||||||
| Net loss | $ | (57,256 | ) | $ | (60,677 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Depreciation and amortization | 3,000 | 3,000 | ||||||
| Common stock issued for service | - | 12,000 | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Asset held for sale | (3,521 | ) | (1,266 | ) | ||||
| Accrued expenses | (7,750 | ) | 36,352 | |||||
| Taxes payable | 400 | 150 | ||||||
| Net cash used in operating activities | (65,127 | ) | (10,441 | ) | ||||
| Investing Activities: | ||||||||
| Purchase of property and equipment | - | (15,000 | ) | |||||
| Net cash used in investing activities | - | (15,000 | ) | |||||
| Financing Activities: | ||||||||
| Due to related party | 54,900 | 14,000 | ||||||
| Proceeds from Notes payable-stockholder | 2,140 | - | ||||||
| Principal paid on Note payable stockholder | - | (2,560 | ) | |||||
| Proceeds from Notes payable-related parties | - | 9,260 | ||||||
| Net cash provided by financing activities | 57,040 | 20,700 | ||||||
| Net decrease in cash | (8,087 | ) | (4,741 | ) | ||||
| Cash, beginning of period | 8,855 | 13,596 | ||||||
| Cash, end of period | $ | 768 | $ | 8,855 | ||||
| Non-cash investing and financing activities: | ||||||||
| Common stock issued for service | $ | - | $ | 12,000 | ||||
| Common stock issued for debt reduction of notes payable. | $ | - | $ | 26,700 | ||||
| Supplemental disclosure if cash flow information | ||||||||
| Cash paid for interest | $ | - | $ | 1,840 | ||||
| Cash paid for taxes | $ | - | $ | - | ||||
The accompanying notes are an integral part of these audited financial statements.
| F-6 |
STATEMENTS OF CASH FLOWS
| For the year | For the year | |||||||
| ended | ended | |||||||
| December 31, 2016 | December 31, 2015 | |||||||
| Operating Activities: | ||||||||
| Net loss | $ | (184,286 | ) | $ | (539,060 | ) | ||
| Adjustments to reconcile net loss to net cash used by operating activities: | ||||||||
| Depreciation and amortization | 8,626 | 10,925 | ||||||
| Bad Debt expense | 11,321 | - | ||||||
| Common stock issued for service and stock compensation | 30,050 | 139,800 | ||||||
| Loss on sale of equipment | 18,109 | - | ||||||
| Derivative and interest expense | - | 62,979 | ||||||
| Change in FV of derivatives | - | (50,345 | ) | |||||
| Amortization of debt discounts | - | 138,260 | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accrued expenses | 66,625 | (1,166 | ) | |||||
| Due to related party | - | (8,425 | ) | |||||
| Taxes payable | 500 | (456 | ) | |||||
| Net cash used in operating activities | (49,055 | ) | (247,488 | ) | ||||
| Investing Activities: | ||||||||
| Purchase of equipment | - | (39,956 | ) | |||||
| Proceeds from sale of equipment | 18,000 | - | ||||||
| Net cash used by investing activities | 18,000 | (39,956 | ) | |||||
| Financing Activities: | ||||||||
| Principal paid on Notes payable related parties | - | (2,399 | ) | |||||
| Proceeds from Notes payable | - | 26,500 | ||||||
| Proceeds from Notes payable related parties | 29,205 | 263,000 | ||||||
| Net cash provided by financing activities | 29,205 | 287,101 | ||||||
| Net decrease in cash | (1,850 | ) | (343 | ) | ||||
| Cash, beginning of period | 1,922 | 2,265 | ||||||
| Cash, end of period | $ | 72 | $ | 1,922 | ||||
| Non-cash investing and financing activities: | ||||||||
| Common stock issued in settlement for debt | $ | 30,050 | $ | 199,761 | ||||
| Settlement of derivative liability through conversion of notes payable. | $ | - | $ | 454,267 | ||||
| Supplemental disclosure if cash flow information | ||||||||
| Cash paid for interest | $ | - | $ | - | ||||
| Cash paid for taxes | $ | - | $ | 1,375 | ||||
The accompanying notes are an integral part of these financial statements.
Notes to Financial StatementsNOTES TO AUDITED FINANCIAL STATEMENTS
December 31, 20162020 and 20152019
1. ORGANIZATION
Powerdyne, Inc., was incorporated on February 2, 2010 in Nevada, and is registered to do business in Rhode Island.Island and Massachusetts. On February 7, 2011, Powerdyne, Inc. merged with Powerdyne International, Inc., formerly Greenmark Acquisition Corporation, a publicly held Delaware corporation.
On December 13, 2010, Powerdyne International, Inc., formerly Greenmark Acquisition Corporation, filed an Amended and Restated Articles of Incorporation in order to, among other things, increase the authorized capital stock to 300,000,000 common shares, par value $0.0001 per share. Unless the context specifies otherwise, as discussed in Note 2, references to the “Company” refers to Powerdyne International Inc. and Powerdyne Inc. after the merger.
At the closing of the merger, each share of Powerdyne, Inc.’s common stock issued and outstanding immediately prior to the closing of the Merger was exchanged for the right to receive 7,520 shares of common stock of Powerdyne International, Inc. Accordingly, an aggregate of 188,000,000 shares of common stock of Powerdyne International Inc. were issued to the holders of Powerdyne Inc.’s common stock.
In March 2014, the Company began distribution of completely packaged independent electrical generator units that run on environmentally friendly fuel sources, such as natural gas and propane.
In 2014, Powerdyne International, Inc. filed an amendment to its Articles of Incorporation which increased the authorized capital stock to 550,000,000 common shares, par value $0.0001 per share.
On January 26, 2015, Powerdyne International, Inc. filed an amendment to its Articles of Incorporation which increased the authorized capital stock to 2,020,000,000 shares consisting of 2,000,000,000 common shares, par value $0.0001 per share and 20,000,000 shares which may be designated as common or preferred stock, par value $0.0001 per share.
In March 2014 the Company began production and distribution of completely packaged independent electrical generator units that run on environmentally-friendly fuel sources, such as natural gas and propane.
2. REVERSE MERGER ACCOUNTING
On February 7, 2011, Greenmark Acquisition Corporation, which was a publicly held Delaware corporation, merged with Powerdyne, Inc. Upon closing of the transaction, Greenmark Acquisition Corporation, the surviving corporation in the merger, changed its name to Powerdyne International, Inc.
The merger was accounted for as a reverse-merger, and recapitalization in accordance with generally accepted accounting principles in the United States (“GAAP”). Powerdyne Inc. was the acquirer for financial reporting purposespurpose and the Company was the acquired company. Consequently, the assets and liabilities and the operations that are reflected in the historical financial statements prior to the merger are those of Powerdyne, Inc. and have been recorded at the historical cost basis of Powerdyne, Inc., and the financial statements after completion of the merger include the assets and liabilities of the Company and Powerdyne, Inc., historical operations of Powerdyne, Inc. and operations of the Company from the closing date of the merger. Common stock and the corresponding capital amounts of the Company pre-merger were retroactively restated as capital stock shares reflecting the exchange ratio in the merger. In conjunction with the merger, the Company received no cash and assumed no liabilities from Greenmark Acquisition Corporation.
3. BASIS OF PRESENTATION
The accompanying audited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and include all the notes required by generally accepted accounting principles for complete financial statements. The statements presented as of December 31, 2020 and December 31, 2019, are audited. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for fair presentation of the financial statements have been included.
POWERDYNE INTERNATIONAL, INC.
Notes to Financial StatementsNOTES TO AUDITED FINANCIAL STATEMENTS
December 31, 20162020 and 20152019
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The summary of significant accounting policies presented below is designed to assist in understanding the Company’s financial statements.
Such financial statements and accompanying notes are the representations of the Company’s management, who are responsible for their integrity and objectivity. These accounting policies conform to accounting principles generally accepted in the United States of America (“GAAP”) in all material respects and have been consistently applied in preparing the accompanying financial statements.
Going Concern
Since its inception, the Company has devoted substantially all of its efforts to business planning, research and development, recruiting management and technical staff, acquiring operating assets and raising capital. The Company has not generated significant revenues from its principal operations, and there is no assurance of future revenues. As of December 31, 2016,2020, the Company had an accumulated deficit of $3,374,003.$3,608,056. The Company’s continuation as a going concern is dependent on its ability to generate sufficient cash flows from operations to meet its obligations and/or obtaining additional financing from its members or other sources, as may be required.
The Company’s activities will necessitate significant uses of working capital beyond December 31, 2016.2020. Additionally, the Company’s capital requirements will depend on many factors, including the success of the Company’s sales and the status of competitive products. The Company plans to continue financing its operations with cash received from financing activities, and revenue from operations.operations and or affiliate funding.
While the Company strongly believes that its capital resources will be sufficient in the near term, there is no assurance that the Company’s activities will generate sufficient revenues to sustain its operations without additional capital or, if additional capital is needed, that such funds if available, will be obtainable on terms satisfactory to the Company.
The accompanying audited financial statements have been prepared assuming that the Company will continue as a going concern; however, the above condition raises substantial doubt about the Company’s ability to do so. The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result should the Company be unable to continue as a going concern.concern
Use of Estimates
In preparing these audited financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amount of revenues and expenses during the reporting periods. Actual results could differ from those estimates.
POWERDYNE INTERNATIONAL, INC.
Notes to Financial Statements
December 31, 2016 and 2015
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Fair Value of Financial Instruments
The Company follows guidance for accounting for fair value measurements of financial assets and financial liabilities and for fair value measurements of nonfinancial items that are recognized or disclosed at fair value in the financial statements on a recurring basis. Additionally, the Company adopted guidance for fair value measurement related to nonfinancial items that are recognized and disclosed at fair value in the financial statements on a nonrecurring basis. The guidance establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows:
Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.
Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
Level 3 inputs are unobservable inputs for the asset or liability.
POWERDYNE INTERNATIONAL, INC.
NOTES TO AUDITED FINANCIAL STATEMENTS
December 31, 2020 and 2019
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
The Company monitors the market conditions and evaluates the fair value hierarchy levels at least quarterly. For any transfers in and out of the levels of the fair value hierarchy, the Company elects to disclose the fair value measurement at the beginning of the reporting period during which the transfer occurred.
The Company'sCompany’s financial instruments consisted of cash, asset held for sale, accounts payable and accrued liabilities, advances to stockholders, and notes payable and convertible debt.payable. The estimated fair value of cash, asset held for sale, accounts payable and accrued liabilities, advances to stockholders, and notes payable approximates its carrying amount due to the short maturity of these instruments. The recognition of the derivative values of convertible debt are based on the weighted-average Black-Scholes option pricing model.
Cash
The Company considers all highly-liquidhighly liquid investments with maturities of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of December 31, 20162020 and December 31, 2015,2019, respectively.
Concentration of Credit Risk
Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents. The Company places its cash with high quality banking institutions. From time to time, the Company may maintain cash balances at certain institutions in excess of the Federal Deposit Insurance Corporation limit. The Company has not incurred any loss from this risk.
Asset held for Sale
The Company considers asset held for sale to be revenue that has been earned, but for which no cash has been received. Asset held for sale consists of crypto mined coins that are held in a digital wallet and have not been cashed out. The basis of the valuation is the market price of the Sia coins on December 31, 2020. The Company considers this to be a current asset since the crypto mined coins can be redeemed for cash at any time. The Company had $4,787 of asset held for sale as of December 31, 2020 and $1,266 as of December 31, 2019. Revenue is recognized on the last date of the quarter based on the transaction price of the Sia coin at that date times the number of coins in the wallet. Unrealized gains and losses are recognized quarterly based on the fluctuation in the market value of the coin versus the value booked when obtained.
Property and Equipment
Property and equipment is stated at cost. Capital expenditures for improvements and upgrades to existing equipment are also capitalized. Maintenance and repairs are expensed as incurred. The equipment is depreciated over 105 years on a straight-line basis. Vehicles are depreciated over 5 years usingDepreciation expense for the straight-line basis.
POWERDYNE INTERNATIONAL, INC.
Notes to Financial Statements
periods ended December 31, 20162020 and 2015
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)2019 was $3,000 and $3,000, respectively.
Derivatives and Hedging
In April 2008, the FASB issued a pronouncement that provides guidance on determining what types of instruments or embedded features in an instrument held by a reporting entity can be considered indexed to its own stock for the purpose of evaluating the first criteria of the scope exception in the pronouncement on accounting for derivatives.
This pronouncement was effective for financial statements issued for fiscal years beginning after December 15, 2008. The adoption of these requirements can affect the accounting for many convertible instruments with provisions that protect holders from a decline in the stock price. Each reporting period, the Company evaluates whether convertible debt to acquire stock of the Company contain provisions that protect holders from declines in the stock price or otherwise could result in modification of the exercise price under the respective convertible debt agreements.
Long-Lived Assets
In accordance with ASC 350-30 (formerly SFAS No. 144,Accounting for the Impairment or Disposal of Long-Lived AssetsAssets),), the Company evaluates long-lived assets for impairment whenever events or changes in circumstances indicate that their then carrying values may not be recoverable. When such factors and circumstances exist, the Company compares the projected undiscounted future cash flows associated with the related asset or group of assets over their estimated useful lives against their respective carrying amount. Impairment, if any, is based on the excess of the carrying amount over the fair value, based on market value when available, or discounted expected cash flows, of those assets and is recorded in the period in which the determination is made. The Company’s management currently believes there is no impairment of its long-lived assets. There can be no assuranceassurances however, that market conditions will not change or demand for the Company’s products under development will continue. Either of these could result in future impairment of long-lived assets.
POWERDYNE INTERNATIONAL, INC.
NOTES TO AUDITED FINANCIAL STATEMENTS
December 31, 2020 and 2019
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Income Taxes
As a result of the implementation of certain provisions of ASC 740,Income Taxes, (formerly FIN 48,Accounting for Uncertainty in Income Taxes – An Interpretation of FASB Statement No. 109),(“ (“ASC 740”), which clarifies the accounting and disclosure for uncertainty in tax positions, as defined. ASC 740 seeks to reduce the diversity in practice associated with certain aspects of the recognition and measurement related to accounting for income taxes.
POWERDYNE INTERNATIONAL, INC.
Notes to Financial Statements
December 31, 2016 and 2015
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
In 2010, the Company adopted Accounting for Uncertain Income Taxes under the provisions of ASC 740. ASC 740 clarifies the accounting for income taxes by prescribing a minimum recognition threshold a tax position is required to meet before being recognized in the financial statements. It also provides guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition. The Company did not recognize any additional liability for unrecognized tax benefits as a result of the adoption of ASC 740. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Valuation allowances are established when it is more likely than not that some or all of the deferred tax assets will not be realized.
The Company believes that its income tax filing positions and deductions will be sustained on audit and does not anticipate any adjustments that will result in a material change to its financial position. Therefore, no reserves for uncertain income tax positions have been recorded pursuant to ASC 740. In addition, the Company did not record a cumulative effect adjustment related to the adoption of ASC 740. The Company’s policy for recording interest and penalties associated with income-based tax audits is to record such items as a component of income taxes.
The Company’s tax provision is determined using an estimate of its annual effective tax rate using enacted tax rates expected to apply to taxable income in the years in which they are earned, adjusted for discrete items, if any, that are taken into account in the relevant period. Each quarter the Company updates its estimate of the annual effective tax rate, and if its estimated tax rate changes, the Company makes a cumulative adjustment. Income taxes payable as of December 31, 20162020 and December 31, 20152019 were $1,000$2,550 and $500,$2,150, respectively.
LossIncome (Loss) per Common Share
Basic lossincome (loss) per common share excludes dilutive securities and is computed by dividing net lossincome (loss) by the weighted average number of common shares outstanding during the period. Diluted earnings per common share reflect the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the entity. Since the Company has only incurred losses, basic and diluted loss per share is the same. As of December 31, 20162020, and 2015,December 31, 2019, there were no outstanding dilutive securities.
The following table represents the computation of basic and diluted losses per share:share (unaudited):
| Year ended December 31, 2016 | Year ended December 31, 2015 | |||||||||||||||
| Year ended December 31, 2020 | Year ended December 31, 2019 | |||||||||||||||
| Loss available for common shareholder | $ | (184,286 | ) | $ | (539,060 | ) | $ | (57,256 | ) | $ | (60,677 | ) | ||||
| Basic and fully diluted loss per share | $ | (0.00 | ) | $ | (0.00 | ) | $ | 0.00 | $ | 0.00 | ||||||
| Weighted average common shares outstanding - basic and diluted | 1,517,448,344 | 963,014,524 | 1,914,930,584 | 1,638,199,077 | ||||||||||||
Net loss per share is based upon the weighted average shares of common stock outstanding.
POWERDYNE INTERNATIONAL, INC.
NOTES TO AUDITED FINANCIAL STATEMENTS
December 31, 2020 and 2019
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Recent Accounting Pronouncements
In JuneJanuary 2017, the Financial Accounting Standards Board (“FASB’’) issued Accounting Standards Update (“ASU”) 2017-01, Business Combinations (Topic 805) to clarify the definition of a business, which is fundamental in the determination of whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses combinations. The updated guidance requires that in order to be considered a business the integrated set of assets and activities acquired must include, at a minimum, an input and process that contribute to the ability to create output. If substantially all of the fair value of the assets acquired is concentrated in a single identifiable asset or group of similar assets, it is not considered a business, and therefore would not be considered a business combination. The update is effective for fiscal years beginning after December 15, 2018, and interim periods with fiscal years beginning after December 15, 2019. The Company is currently evaluating the impact of adopting this guidance on our consolidated financial statements.
In March 2016, the FASB issued ASU No. 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share- Based Payment Accounting (ASU 2016-09). Under ASU 2016-09, the tax effects of stock compensation will be recognized as income tax expense or benefit to the Company’s income statement and the tax effects of exercised or vested awards will be treated as discrete items in the reporting period in which they occur. Along with other income tax cash flows, excess tax benefits will be classified as operating activities, and cash paid by the Company when directly withholding shares for tax withholding purposes will be classified as financing activities. At this time, this does not apply to the Company and therefore does not have an impact on its current financial statements. The Company decided to account for forfeitures when they occur which, did not have a material impact to the Company’s financial statements.
Revenue Recognition
In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), requiring lessees to recognize for all leases (with the exception of short-term leases) at the commencement date: (1) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis, and (2) a right-of-use (“ROU”) asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. The update is effective for fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020. The Company currently anticipates that upon adoption of the new standard, ROU assets and lease liabilities will be recognized in amounts that will be immaterial to the balance sheets.
In May 2014, the FASB issued ASU 2014-10, Development Stage Entities (Topic 915): Eliminationan accounting standard update that amends the accounting guidance on revenue recognition. The amendment in this accounting standard update are intended to provide a more robust framework for addressing revenue issues, improve comparability of Certain Financial Reporting Requirements. ASU 2014-10 eliminates the distinction of a development stage entity and certain related disclosure requirements, including the elimination of inception-to-date information on the statements of operations, cash flows and stockholders’ equity. The amendments in ASU 2014-10revenue standard update will be applied using either of the following transition methods: 1) a full retrospective approach reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients, or 2) a modified retrospective approach with the cumulative effect of initially adopting the standard recognized at the date of adoption (which requires additional footnote disclosures). This accounting update is effective prospectively for annual reporting periods beginning after December 15, 2014, and interim periods within those annual periods, however early2017. Early adoption is permitted.permitted only as of reporting periods beginning after December 31, 2016.
Sia coin is the only crypto coin that Powerdyne is mining. The Company adopted ASU 2014-10 sincecoins are held in the Company’s Sia coin digital wallet. When coins are going to be exchanged for USD, they are then transferred to the company’s exchange wallet held at a US based crypto exchange which provides support for two-factor authentication. We also have wallet password management, and offsite backups. The coins are held in anticipation of future price appreciation as crypto currencies become more widely accepted, but some coins may be exchanged for USD on a as needed basis. The company also realizes there is no guarantee the coins will apricate in value. Revenue is recognized on the last date of the quarter ended June 30, 2014, thereby no longer presenting or disclosing any information required by Topic 915.based on the market price of the Sia coin at that date times the number of coins in the wallet.
In August 2014, the FASB issued ASU No. 2014-15, “Presentation of Financial Statements – Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern” (“ASU 2014-15”). ASU 2014-15, which is effective for annual reporting periods ending after December 15, 2016, extends the responsibility for performing the going-concern assessment to management and contains guidance on how to perform a going-concern assessment and when going-concern disclosures would be required under U.S. GAAP. The Company elected to adopt ASU 2014-15 effective with this financial statement. Management’s evaluations regarding the events and conditions that raise substantial doubt regarding the Company’s ability to continue as a going concern have been disclosed in this Note 5.
| F-11 |
POWERDYNE INTERNATIONAL, INC.
Notes to Financial Statements
December 31, 2016 and 2015
5. PROPERYRESTATEMENT OF FINANCIAL STATEMENTS
In accordance with ASC 250-10-50-7, the Company has restated the Balance Sheet as of December 31, 2019. As reported, on the Balance Sheet, under Current Assets, stated $1,266 of accrued revenue, and under Property and Equipment, stated Property and Equipment at net in the amount of $12,000. As restated, the accrued revenue is now titled “asset held for sale” in the amount of $1,266. In addition, as restated, the Property and Equipment shows the description of the asset as cryptocurrency miners and the cost of these cryptocurrency miners of $15,000, and shows the amount of accumulated depreciation of $3,000, totaling $12,000. (See Note 7) This restatement of the Balance Sheet as of December 31, 2019 had no effect on Accumulated deficit as of December 31, 2019 and Net Loss for the year ended December 31, 2019.
In accordance with ASC 250-10-50-7, the Company has restated the Statement of Operations for the year ended December 31, 2019. As reported, on the Statement of Operations, the Cost of revenues was -0-, and the Gross Profit was $8,378. In addition, the Operating expenses were stated at $28,793. As restated, the Cost of revenues is $3,000, the Gross profit is $5,378 and the Operating expenses are $25,793. This restatement is due to a reclassification of depreciation from operating expense to cost of revenue, since the only revenue received is from crypto mining, therefore the crypto mining equipment is considered to be a cost of revenue and not an operating expense. This restatement of the Statement of Operations for the year ended December 31, 2019 had no effect on Accumulated deficit as of December 31, 2019, and no effect on Loss from Operations and Net Loss for the year ended December 31, 2019.
In accordance with ASC 250-10-50-7, the Company has restated the Statement of Cash Flows for the year ended December 31, 2019. As reported, under Operating Activities: 1) Adjustments to reconcile net loss to net cash used in operating activities included Common stock issued for service and debt reduction of $38,700; and 2) Changes in operating assets and liabilities included Due to related party of $14,000. As reported, the Net cash provided by operating activities was $30,259. In addition, as reported, Financing Activities included Principal paid on Notes payable-related parties of $26,700, and Net cash used in financing activities, as reported, was $20,000. During 2020, the Company discovered that $26,700 of the $38,700 reported as Common stock issued for service and debt reduction was Common stock issued to reduce debt and therefore should not have been included in both Operating Activities and Financing Activities. The Company also discovered the Due to related party of $14,000 should not have been included in Operating Activities but should have been included in Financing Activities. The Statement of Cash Flow for the year ended December 31, 2019 was restated to correct these items. The restated Statement of Cash Flows removed $26,700 of Common stock issued for debt reduction, and $14,000 of Due to related party from the Operating Activities, resulting in Net cash used in operating activities of $10,441. In addition, the restated Statement of Cash Flows includes Due to related party of $14,000 in Financing Activities and removes $26,700 of Principal paid on Notes payable-related parties of $26,700 (since this was common stock issued for debt reduction and therefore a non-cash transaction) from Financing Activities, resulting in Net cash provided by financing activities of $20,700. These changes had no effect on the Net decrease in cash on the Statement of Cash Flows. The restatement of the Statement of Cash Flows for the year ended December 31, 2019 had no effect on Accumulated deficit at December 31, 2019 and Net Loss for the year ended December 31, 2019.
6. PROPERTY AND EQUIPMENT - NET
Equipment consists of the following as of December 31, 20162020 and December 31, 2015:2019:
| December 31, | December 31, | December 31, | December 31, | |||||||||||||
| 2016 | 2015 | 2020 | 2019 | |||||||||||||
| Machinery and equipment | $ | 39,956 | $ | 132,559 | ||||||||||||
| (unaudited) | (audited) | |||||||||||||||
| Cryptocurrency miners | $ | 15,000 | $ | 15,000 | ||||||||||||
| Less accumulated depreciation | (5,660 | ) | (53,528 | ) | (6,000 | ) | (3,000 | ) | ||||||||
| Total Property and Equipment | $ | 34,296 | $ | 79,031 | $ | 9,000 | $ | 12,000 | ||||||||
Equipment is stated at cost and depreciated on a straight-linestraight- line basis over the assets’ estimated useful lives: machinery andcomputer equipment 105 years. Total depreciation expense for the periodsyear ended December 31, 20162020 and 20152019 was $8,626$3,000 and $10,925,$3,000, respectively.
POWERDYNE INTERNATIONAL, INC.
6. STOCKHOLDER EQUITYNOTES TO AUDITED FINANCIAL STATEMENTS
December 31, 2020 and 2019
Stock issued for services7. RESTATEMENT OF PROPERTY AND EQUIPMENT
OnAs reported, the balance sheet as of December 31, 2019 showed the Property and Equipment as such and was reported at net. The balance sheet has since been restated, showing the name of the Property and Equipment as cryptocurrency miners, and showing the cost of these assets of $15,000 and the accumulated depreciation of $3,000, totaling $12,000, instead of the net amount as previously reported. The cryptocurrency miners consist of 5 used Obelisk SC1 units purchased in January 19, 20162019, that can mine certain crypto coins. The cryptocurrency miners are stated at cost and depreciated on a straight- line basis over the Company issued 3,000,000 shares to a consultantassets’ estimated useful life of 5 years. This restatement had no effect on Accumulated deficit as compensationof December 31, 2019 and Net Loss for services rendered. The Company valued the stock at $0.0003, for a total of $900.
On January 19, 2016 the Company issued 500,000 shares to a consultant as compensation for services rendered. The Company valued the stock at $0.0003, for a total of $150.
On January 25, 2016 the Company issued 30,000,000 shares to stockholder as compensation for services rendered. The Company valued the stock at $0.0002, for a total of 6,000.
On January 25, 2016 the Company issued 75,000,000 shares to stockholder as compensation for services rendered. The Company valued the stock at $0.0002, for a total of $15,000.
On January 25, 2016 the Company issued 40,000,000 shares to a consultant as compensation for services rendered. The Company valued the stock at $0.0002, for a total of $8,000.
During the year ended December 31, 2016 148,500,000 shares were issued to consultants and stockholders as compensation for services rendered. The Company valued the stock at $0.0003 and $.00002 per share for a total of $30,050 based on the closing price of the day of issuance.
On June 30, 2016, the Board of Directors authorized the designation of 2,000,000 shares of stock as Series A Preferred Stock. The Series A Preferred Stock will not be entitled to dividends or payment upon liquidation, dissolution or winding up. Each share of Series A Preferred Stock will be entitled to 1,000 votes per share. Upon filing of a Certificate of Designations with the Secretary of State of the State of Delaware, we will be entitled to issue up to 2,000,000 shares of Series A Preferred Stock.2019
7.8. LEASE
On March 11, 2015 Powerdyne International, Inc. (the “Company”) finalized its negotiations with Farmacia Brisas del Mar, a corporation organized under the laws of Puerto Rico (the “Lessee”), and the Company and the Lessee have entered into a five-year contract to lease power generating equipment to Lessee based upon power consumption. In addition, the custom designed system will also provide cogeneration capabilities with the addition of chillers to support the air conditioning demands. The agreement provides for a payment to the Company of a monthly fee equal to the greater of a set monthly base rate or a monthly base rate plus an additional amount based on kilowatt wattage. The agreement provides for termination by the Company only in the event of nonperformance by the Lessee unless Lessee pays all payments due for the remainder of the term. The agreement contains representation and warranties, default provisions and indemnification provisions typical for agreements of this type. In 2016 the terms on the Farmacia Del Mar lease was modified to a monthly payment, based on actual power consumption. The total revenue-to date derived from this lease is $1,240.
During the year ended December 31, 2017, Powerdyne International, Inc. (the Company) determined that all of the machinery and equipment was impaired due to Hurricane Maria, which occurred in September 2017, resulting in the disappearance of the genset in Puerto Rico. Due to the logistics of transportation after Hurricane Maria the company decided to terminate the lease with the Farmacia Del Mar.
During the quarter ended March 31, 2019 Powerdyne International, Inc. purchased several crypto currency miners and began mining certain crypto coins. This was done in an effort to enter into the crypto markets and explore other potential revenue opportunities for Powerdyne International, Inc.
During the year ended December 31, 2019 Powerdyne International, Inc.’s board of directors agreed to acquire all the assets of Creative Motion Technology a company which is wholly owned by James O’Rourke. James O’Rourke will be merging the assets of Creative Motion Technology, to Powerdyne without consideration. Due to the Covid 19 pandemic, the parties agreed to postpone the merger until approximately the second quarter of 2021.
During this same period Powerdyne International accepted forgiveness of debt letters from the related party debt holders forgiving all unpaid debt and accrued interest owed to them individually, by the Corporation.
During this same period Powerdyne International as part a corporate reorganization, accepted the resignation of the Director of the Corporation and as Chairman of the Board. The remaining directors unanimously resolved to elect James O’Rourke as Chairman of the Board. The Company then accepted the resignation of the remaining Board of Directors.
9. COMMON STOCK
Stock issued for services
All of the services rendered to the Company as set forth below were rendered as of the recent balance sheet.
On September 18, 2019, the Company issued 10,000,000 shares to a consulting company as compensation for services rendered. The company valued the stock at $0.0001, for a total of $1,000, for public relation services ended October 2019.
On September 18, 2019, the Company issued 25,000,000 shares to a consultant as compensation for financial statement services rendered. The Company valued the stock at $0.0001, for a total of $2,500.
On September 18, 2019, the Company issued 10,000,000 shares to a stockholder as compensation for business strategy services rendered. The Company valued the stock at $0.0001, for a total of $1,000.
On September 18, 2019, the Company issued 5,000,000 shares to a consultant as compensation for legal services rendered. The Company valued the stock at $0.0001, for a total of $500.
On September 18, 2019, the Company issued 25,000,000 shares to a consultant as compensation for IT services rendered. The Company valued the stock at $0.0001, for a total of $2,500.
POWERDYNE INTERNATIONAL, INC.
Notes to Financial StatementsNOTES TO AUDITED FINANCIAL STATEMENTS
December 31, 20162020 and 20152019
On September 18, 2019, the Company issued 22,000,000 shares to a stockholder as compensation for accounting software services rendered. The Company valued the stock at $0.0001, for a total of $2,200.
On September 18, 2019, the Company issued 23,000,000 shares to a stockholder as compensation for accounting services rendered. The Company valued the stock at $0.0001, for a total of $2,300.
8.Common stock issued in exchange for debt
On September 18, 2019, the Company issued 117,000,000 shares in exchange for the extinguishment of $11,700 of debt held by a related party.
On September 18, 2019, the Company issued 75,000,000 shares in exchange for the extinguishment of $7,500 debt held by a related party.
On September 18, 2019, the Company issued 50,000,000 shares in exchange for the extinguishment of $5,000 of debt held by a related party.
On September 18, 2019, the Company issued 25,000,000 shares in exchange for the extinguishment of $2,500 debt held by a related party.
10. RELATED PARTY –Promissory- Promissory Note
On December 31, 2019, the Company extinguished all of the debt from five different related parties as well as the accrued interest on this debt. This resulted in an increase in additional paid-in capital of $609,585 for the year ended December 31, 2019. The total principal amount of the notes payable-related party debt was $440,160 and the accrued interest on these notes was $169,424 on December 31, 2019, before extinguishment. The Company had previously obtained financing from five different related parties from 2012 through December 31, 2016. As of December 31, 2016, 82.61% of the short-term financing is from Arthur Read. The accrued interest payable to Mr. Read is $44,951.2019. The following are breakdowns for the promissory notes issued to all five related parties.
The Company obtained financing from a related party in the form of three demand Notes Payable in the aggregate amount of $10,000 which have beenwas outstanding since the year ended December 31, 2012. The Company repaid a total of $5,000 of the principal on Note 1 during the quarter ended September 30, 2019 through the issuance of stock. All three notes have been amended, extendingwere extinguished on December 31, 2019. The total principal on these notes was $5,000 and the maturity dates. See maturity datesaccrued interest was $4,981 on table below.December 31, 2019, before extinguishment. The Notes bearnotes bore an interest rate of 7% per annum and arewere unsecured.
| Note | Principal | Rate | Accrued interest | Maturity | Principal before debt forgiveness | Principal after debt extinguishment 12/31/19 | Rate | Accrued interest | Maturity | |||||||||||||||||||||||||||||||
| 12/31/16 | 12/31/15 | 12/31/19 | 12/31/18 | |||||||||||||||||||||||||||||||||||||
| Promissory note 1 | $ | 6,000 | 7 | % | $ | 1,816 | $ | 1,395 | 9/4/2018 | $ | 1,000 | $ | - | 7 | % | $ | - | $ | 2,656 | N/A | ||||||||||||||||||||
| Promissory note 2 | $ | 2,000 | 7 | % | $ | 594 | $ | 454 | 10/1/2017 | $ | 2,000 | $ | - | 7 | % | $ | - | $ | 874 | N/A | ||||||||||||||||||||
| Promissory note 3 | $ | 2,000 | 7 | % | $ | 571 | $ | 430 | 12/3/2017 | $ | 2,000 | $ | - | 7 | % | $ | - | $ | 851 | N/A | ||||||||||||||||||||
| Total | $ | 10,000 | $ | 2,981 | $ | 2,279 | $ | 5,000 | $ | - | $ | - | $ | 4,381 | ||||||||||||||||||||||||||
POWERDYNE INTERNATIONAL, INC.
NOTES TO AUDITED FINANCIAL STATEMENTS
December 31, 2020 and 2019
10. RELATED PARTY - Promissory Note (continued)
The Company obtained financing from a related party in the form of twenty-four demand Notes Payable in the aggregate amount of $390,437 during the period from 2012 through December 31, 2017. The Company repaid a total of $2,853 of the principal on Note 7 during the years ended December 31, 2014 and December 31, 2015. The principal on Note 23 in the amount of $6,308 was repaid in full in April 2017. During the quarter ended September 30, 2019 the Company repaid a total of $5,000 of the principal on Note 1, $972 of the principal on Note 6, and $1,528 of the principal on Note 2 through the issuance of stock. All twenty-four notes were extinguished on December 31, 2019. The total principal on these notes was $373,776 and the accrued interest was $142,185 on December 31, 2019, before extinguishment. Notes 1 21, and 24 bore an interest rate of 7% per annum and were unsecured. Notes 22 and 23 bore an interest rate of 20% and were unsecured.
| Note | Principal before debt forgiveness | Principal after debt extinguishment 12/31/19 | Rate | Accrued interest | Maturity | |||||||||||||||||
| 12/31/19 | 12/31/18 | |||||||||||||||||||||
| Promissory note 1 | $ | - | $ | - | 7 | % | $ | - | $ | 2,222 | N/A | |||||||||||
| Promissory note 2 | $ | 9,473 | $ | - | 7 | % | $ | - | $ | 4,768 | N/A | |||||||||||
| Promissory note 3 | $ | 15,000 | $ | - | 7 | % | $ | - | $ | 6,406 | N/A | |||||||||||
| Promissory note 4 | $ | 102 | $ | - | 7 | % | $ | - | $ | 44 | N/A | |||||||||||
| Promissory note 5 | $ | 879 | $ | - | 7 | % | $ | - | $ | 376 | N/A | |||||||||||
| Promissory note 6 | $ | - | $ | - | 7 | % | $ | - | $ | 432 | N/A | |||||||||||
| Promissory note 7 | $ | 22,147 | $ | - | 7 | % | $ | - | $ | 7,405 | N/A | |||||||||||
| Promissory note 8 | $ | 7,000 | $ | - | 7 | % | $ | - | $ | 1,990 | N/A | |||||||||||
| Promissory note 9 | $ | 6,000 | $ | - | 7 | % | $ | - | $ | 1,693 | N/A | |||||||||||
| Promissory note 10 | $ | 25,000 | $ | - | 7 | % | $ | - | $ | 6,971 | N/A | |||||||||||
| Promissory note 11 | $ | 35,000 | $ | - | 7 | % | $ | - | $ | 9,572 | N/A | |||||||||||
| Promissory note 12 | $ | 40,000 | $ | - | 7 | % | $ | - | $ | 10,464 | N/A | |||||||||||
| Promissory note 13 | $ | 30,000 | $ | - | 7 | % | $ | - | $ | 7,693 | N/A | |||||||||||
| Promissory note 14 | $ | 45,000 | $ | - | 7 | % | $ | - | $ | 11,107 | N/A | |||||||||||
| Promissory note 15 | $ | 25,000 | $ | - | 7 | % | $ | - | $ | 6,008 | N/A | |||||||||||
| Promissory note 16 | $ | 15,000 | $ | - | 7 | % | $ | - | $ | 3,538 | N/A | |||||||||||
| Promissory note 17 | $ | 13,000 | $ | - | 7 | % | $ | - | $ | 2,987 | N/A | |||||||||||
| Promissory note 18 | $ | 5,000 | $ | - | 7 | % | $ | - | $ | 1,138 | N/A | |||||||||||
| Promissory note 19 | $ | 10,000 | $ | - | 7 | % | $ | - | $ | 2,223 | N/A | |||||||||||
| Promissory note 20 | $ | 3,000 | $ | - | 7 | % | $ | - | $ | 640 | N/A | |||||||||||
| Promissory note 21 | $ | 17,000 | $ | - | 7 | % | $ | - | $ | 3,629 | N/A | |||||||||||
| Promissory note 22 | $ | 50,000 | $ | - | 20 | % | $ | - | $ | 17,754 | N/A | |||||||||||
| Promissory note 23 | $ | - | $ | - | 20 | % | $ | - | $ | 73 | N/A | |||||||||||
| Promissory note 24 | $ | 175 | $ | - | 7 | % | $ | - | $ | 14 | N/A | |||||||||||
| Total | $ | 373,776 | $ | - | $ | - | $ | 109,145 | ||||||||||||||
POWERDYNE INTERNATIONAL, INC.
NOTES TO AUDITED FINANCIAL STATEMENTS
December 31, 2020 and 2019
10. RELATED PARTY - Promissory Note (continued)
The Company obtained financing from a related party in the form of twenty-one demand Notes Payable in the aggregate amount of $331,101$11,484 during the period from 2012 through December 31, 2015. WeSeptember 30, 2019. During the quarter ended September 30, 2019 the Company repaid a total of $2,353$170 of the principal on Note 7 during1, $234 of the years endedprincipal on Note 2, and $2,096 of the principal on Note 3. All twenty-one notes were extinguished on December 31, 20142019. The total principal on these notes was $8,984 and the accrued interest was $4,030 on December 31, 2015. Several of the2019, before extinguishment. The notes have been amended and extended during the period from 2014 through December 31, 2016. See maturity dues on table below. The Notes bearbore an interest rate of 7% per annum and arewere unsecured.
| Note | Principal before debt forgiveness | Principal after debt extinguishment 12/31/19 | Rate | Accrued interest | Maturity | |||||||||||||||||
| 12/31/19 | 12/31/18 | |||||||||||||||||||||
| Promissory note 1 | $ | - | $ | - | 7 | % | $ | - | $ | 99 | N/A | |||||||||||
| Promissory note 2 | $ | - | $ | - | 7 | % | $ | - | $ | 73 | N/A | |||||||||||
| Promissory note 3 | $ | 2,004 | $ | - | 7 | % | $ | - | $ | 1,695 | N/A | |||||||||||
| Promissory note 4 | $ | 2,000 | $ | - | 7 | % | $ | - | $ | 826 | N/A | |||||||||||
| Promissory note 5 | $ | 1,780 | $ | - | 7 | % | $ | - | $ | 344 | N/A | |||||||||||
| Promissory note 6 | $ | 1,125 | $ | - | 7 | % | $ | - | $ | 197 | N/A | |||||||||||
| Promissory note 7 | $ | 100 | $ | - | 7 | % | $ | - | $ | 8 | N/A | |||||||||||
| Promissory note 8 | $ | 150 | $ | - | 7 | % | $ | - | $ | 10 | N/A | |||||||||||
| Promissory note 9 | $ | 100 | $ | - | 7 | % | $ | - | $ | 6 | N/A | |||||||||||
| Promissory note 10 | $ | 150 | $ | - | 7 | % | $ | - | $ | 8 | N/A | |||||||||||
| Promissory note 11 | $ | 100 | $ | - | 7 | % | $ | - | $ | 5 | N/A | |||||||||||
| Promissory note 12 | $ | 140 | $ | - | 7 | % | $ | - | $ | 4 | N/A | |||||||||||
| Promissory note 13 | $ | 100 | $ | - | 7 | % | $ | - | $ | 2 | N/A | |||||||||||
| Promissory note 14 | $ | 200 | $ | - | 7 | % | $ | - | $ | 3 | N/A | |||||||||||
| Promissory note 15 | $ | 500 | $ | - | 7 | % | $ | - | $ | 3 | N/A | |||||||||||
| Promissory note 16 | $ | 75 | $ | - | 7 | % | $ | - | $ | - | N/A | |||||||||||
| Promissory note 17 | $ | 100 | $ | - | 7 | % | $ | - | $ | - | N/A | |||||||||||
| Promissory note 18 | $ | 100 | $ | - | 7 | % | $ | - | $ | - | N/A | |||||||||||
| Promissory note 19 | $ | 100 | $ | - | 7 | % | $ | - | $ | - | N/A | |||||||||||
| Promissory note 20 | $ | 60 | $ | - | 7 | % | $ | - | $ | - | N/A | |||||||||||
| Promissory note 21 | $ | 100 | $ | - | 7 | % | $ | - | $ | - | N/A | |||||||||||
| Total | $ | 8,984 | $ | - | $ | - | $ | 3,283 | ||||||||||||||
POWERDYNE INTERNATIONAL, INC.
Notes to Financial StatementsNOTES TO AUDITED FINANCIAL STATEMENTS
December 31, 20162020 and 20152019
8.10. RELATED PARTY –Promissory- Promissory Note (CONTINUED)(continued)
| Note | Principal | Rate | Accrued interest | Maturity | |||||||||||||||
| 12/31/16 | 12/31/15 | ||||||||||||||||||
| Promissory note 1 | $ | 5,000 | 7 | % | $ | 1,522 | $ | 1,171 | 7/25/2018 | ||||||||||
| Promissory note 2 | $ | 11,000 | 7 | % | $ | 3,228 | $ | 2,456 | 10/22/2017 | ||||||||||
| Promissory note 3 | $ | 15,000 | 7 | % | $ | 4,306 | $ | 3,254 | 11/24/2017 | ||||||||||
| Promissory note 4 | $ | 102 | 7 | % | $ | 30 | $ | 23 | 10/22/2017 | ||||||||||
| Promissory note 5 | $ | 879 | 7 | % | $ | 252 | $ | 191 | 11/24/2017 | ||||||||||
| Promissory note 6 | $ | 973 | 7 | % | $ | 296 | $ | 228 | 7/25/2018 | ||||||||||
| Promissory note 7 | $ | 22,147 | 7 | % | $ | 4,305 | $ | 2,750 | 5/4/2017 | ||||||||||
| Promissory note 8 | $ | 7,000 | 7 | % | $ | 1,010 | $ | 518 | 12/11/2018 | ||||||||||
| Promissory note 9 | $ | 6,000 | 7 | % | $ | 853 | $ | 432 | 12/22/2018 | ||||||||||
| Promissory note 10 | $ | 25,000 | 7 | % | $ | 3,471 | $ | 1,716 | 1/8/2017 | ||||||||||
| Promissory note 11 | $ | 35,000 | 7 | % | $ | 4,672 | $ | 2,215 | 2/5/2017 | ||||||||||
| Promissory note 12 | $ | 40,000 | 7 | % | $ | 4,864 | $ | 2,056 | 4/8/2017 | ||||||||||
| Promissory note 13 | $ | 30,000 | 7 | % | $ | 3,492 | $ | 1,387 | 5/5/2017 | ||||||||||
| Promissory note 14 | $ | 45,000 | 7 | % | $ | 4,807 | $ | 1,648 | 6/24/2017 | ||||||||||
| Promissory note 15 | $ | 25,000 | 7 | % | $ | 2,508 | $ | 753 | 7/28/2017 | ||||||||||
| Promissory note 16 | $ | 15,000 | 7 | % | $ | 1,438 | $ | 385 | 8/20/2017 | ||||||||||
| Promissory note 17 | $ | 13,000 | 7 | % | $ | 1,167 | $ | 254 | 9/21/2017 | ||||||||||
| Promissory note 18 | $ | 5,000 | 7 | % | $ | 439 | $ | 88 | 10/13/2017 | ||||||||||
| Promissory note 19 | $ | 10,000 | 7 | % | $ | 823 | $ | 121 | 10/30/2017 | ||||||||||
| Promissory note 20 | $ | 3,000 | 7 | % | $ | 220 | $ | 10 | 12/15/2017 | ||||||||||
| Promissory note 21 | $ | 17,000 | 7 | % | $ | 1,249 | $ | 55 | 12/15/2017 | ||||||||||
| Total | $ | 331,101 | $ | 44,951 | $ | 21,711 | |||||||||||||
The Company obtained financing from a related party in the form of six demand Notes Payable in the aggregate amount of $9,409 during the period from 2012 through December 31,2 016. Notes 1 - 4 were amended and extended. See maturity dates on table below. The Notes bear an interest rate of 7% per annum and are unsecured.
POWERDYNE INTERNATIONAL, INC.
Notes to Financial Statements
December 31, 2016 and 2015
8. RELATED PARTY –Promissory Note (CONTINUED)
| Note | Principal | Rate | Accrued interest | Maturity | ||||||||||||||
| 12/31/16 | 12/31/15 | |||||||||||||||||
| Promissory note 1 | $ | 234 | 7 | % | $ | 67 | $ | 50 | 12/5/2017 | |||||||||
| Promissory note 2 | $ | 170 | 7 | % | $ | 49 | $ | 37 | 11/18/2017 | |||||||||
| Promissory note 3 | $ | 4,100 | 7 | % | $ | 1,120 | $ | 833 | 2/5/2018 | |||||||||
| Promissory note 4 | $ | 2,000 | 7 | % | $ | 546 | $ | 405 | 2/7/2018 | |||||||||
| Promissory note 5 | $ | 1,780 | 7 | % | $ | 95 | $ | - | 3/29/2018 | |||||||||
| Promissory note 6 | $ | 1,125 | 7 | % | $ | 40 | $ | - | 6/30/2018 | |||||||||
| Total | $ | 9,409 | $ | 1,917 | $ | 1,325 | ||||||||||||
The Company obtained financing from a related party in the form of two demand Notes Payable in the aggregate amount of $18,000 during the year of 2013. Both notes were amendedextinguished on December 31, 2019. The total principal on these notes was $18,000 and extended during the quarter ended Marchaccrued interest was $8,605 on December 31, 2016. See maturity dates on table below.2019, before extinguishment. The Notes bearnotes bore an interest rate of 7% per annum and arewere unsecured.
| Note | Principal before debt forgiveness | Principal after debt extinguishment 12/31/19 | Rate | Accrued interest | Maturity | |||||||||||||||||
| 12/31/19 | 12/31/18 | |||||||||||||||||||||
| Promissory note 1 | $ | 10,000 | $ | - | 7 | % | $ | - | $ | 4,102 | N/A | |||||||||||
| Promissory note 2 | $ | 8,000 | $ | - | 7 | % | $ | - | $ | 3,244 | N/A | |||||||||||
| Total | $ | 18,000 | $ | - | $ | - | $ | 7,346 | ||||||||||||||
| Note | Principal | Rate | Accrued interest | Maturity | ||||||||||||||
| 12/31/16 | 12/31/15 | |||||||||||||||||
| Promissory note 1 | $ | 10,000 | 7 | % | $ | 2,702 | $ | 2,000 | 2/21/2018 | |||||||||
| Promissory note 2 | $ | 8,000 | 7 | % | $ | 2,123 | $ | 1,562 | 3/18/2018 | |||||||||
| Total | $ | 18,000 | $ | 4,826 | $ | 3,562 | ||||||||||||
The Company obtained financing from a related party in the form of sixten demand Note Payables in the aggregate amount of $32,300$46,100 during the period from 2014 through September 30, 2019. During the quarter ended September 30, 2019, the Company repaid the principal of $6,000 on Note 1, $2,500 of the principal on Note 2, and $3,200 of the principal on Note 3. All ten notes were extinguished on December 31, 2016.2019. The Notes bearstotal principal on these notes was $34,400 and the accrued interest was $9,623 on December 31, 2019, before extinguishment. The notes bore an interest rate of 7% per annum and arewere unsecured.
| Note | Principal | Rate | Accrued interest | Maturity | Principal before debt forgiveness | Principal after debt extinguishment 12/31/19 | Rate | Accrued interest | Maturity | |||||||||||||||||||||||||||||||
| 12/31/16 | 12/31/15 | 12/31/19 | 12/31/18 | |||||||||||||||||||||||||||||||||||||
| Promissory note 1 | $ | 6,000 | 7 | % | $ | 1,011 | $ | 590 | 8/6/2018 | $ | - | $ | - | 7 | % | $ | - | $ | 1,851 | N/A | ||||||||||||||||||||
| Promissory note 2 | $ | 2,500 | 7 | % | $ | 174 | $ | - | 1/4/2018 | $ | - | $ | - | 7 | % | $ | - | $ | 524 | N/A | ||||||||||||||||||||
| Promissory note 3 | $ | 4,200 | 7 | % | $ | 242 | $ | - | 2/5/2018 | $ | 1,000 | $ | - | 7 | % | $ | - | $ | 830 | N/A | ||||||||||||||||||||
| Promissory note 4 | $ | 3,000 | 7 | % | $ | 165 | $ | - | 3/20/2018 | $ | 3,000 | $ | - | 7 | % | $ | - | $ | 585 | N/A | ||||||||||||||||||||
| Promissory note 5 | $ | 11,500 | 7 | % | $ | 406 | $ | - | 6/30/2018 | $ | 11,500 | $ | - | 7 | % | $ | - | $ | 2,016 | N/A | ||||||||||||||||||||
| Promissory note 6 | $ | 5,100 | 7 | % | $ | 106 | $ | - | 8/8/2018 | $ | 5,100 | $ | - | 7 | % | $ | - | $ | 819 | N/A | ||||||||||||||||||||
| Promissory note 7 | $ | 5,000 | $ | - | 7 | % | $ | - | $ | 373 | N/A | |||||||||||||||||||||||||||||
| Promissory note 8 | $ | 1,500 | $ | - | 7 | % | $ | - | $ | - | N/A | |||||||||||||||||||||||||||||
| Promissory note 9 | $ | 1,800 | $ | - | 7 | % | $ | - | $ | - | N/A | |||||||||||||||||||||||||||||
| Promissory note 10 | $ | 5,500 | $ | - | 7 | % | $ | - | $ | - | N/A | |||||||||||||||||||||||||||||
| Total | $ | 32,300 | $ | 2,104 | $ | 590 | $ | 34,400 | $ | - | $ | - | $ | 6,998 | ||||||||||||||||||||||||||
POWERDYNE INTERNATIONAL, INC.
NOTES TO AUDITED FINANCIAL STATEMENTS
December 31, 2020 and 2019
10. RELATED PARTY - Promissory Note (continued)
During the year ended December 31, 20162020 the total amount of related party loan proceeds was $29,205.$-0-. The total interest accrued on related party loans aton December 31, 20162020 and December 31, 20152019 was $56,777$-0- and $29,467,$-0-, respectively.
Before the Company became public, $11,321 was advanced to one stockholder. In the 1st quarter of 2016 this advance was deemed uncollectible and therefore written off to bad debt expense.
From time to time, we receive payments from stockholders in the form of cash and/or out-of-pocket expenditures for the benefit of the Company, which are business in nature. On December 11, 2018 we received a loan from a stockholder in the amount of $13,500, to be repaid in monthly installments of principal and interest beginning March 25, 2019. The balance of this loan as of December 31, 2020 was $13,080. The interest expense on this loan as of December 31, 2020 was $2,140.
The balance of advances to stockholderrelated parties as of December 31, 20162020 and December 31, 20152019 was $-0- and $11,321,$-0-, respectively. During the year ended December 31, 2020 a related party advanced the Company $54,900. Amounts accrued, but not yet paid as due to related party at December 31, 20162020 and December 31, 20152019 was $25,000$93,900 and $25,000,$39,000, respectively.
9.11. COMMITMENTS AND CONTINGENCIES
Litigation
There are no pending, threatened or actual legal proceedings in which the Company or any subsidiary is a party.
10. SUBSEQUENT EVENTS
Management has evaluated subsequent events through December 31, 2016, the date upon which the financial statements were issued. Subsequent events are as follows:
On March 28, 2017, Powerdyne International Inc. entered into a fifteen year contract to lease power generating equipment. The lease is subject to financing.
F-15
| F-18 |