UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 1-K
PART I
NOTIFICATION
This Form 1-K is to provide an [X] Annual Report OR [ ] Special Financial Report
for the fiscal year ended 12/31/2023
PGD ECO SOLUTIONS INC.
Exact name of issuer as specified in the issuer’s charter
| Wyoming | 87-2595116 |
| Jurisdiction of incorporation/organization | I.R.S. Employer Identification Number |
7306 Skyview Ave.
New Port Richey, FL 34653
Address of principal executive offices
727-656-7967
Telephone number
Common Stock
Title of each class of securities issued pursuant to Regulation A
Common Stock, par value $0.001
Item 1. BUSINESS
PGD Eco Solutions’ mission is to build a cleaner, quieter, and more renewable future with its energy storage systems to reduce our carbon foot print on the world by providing our clients with custom battery solutions. The goal of PGD Eco Solutions is to design and manufacture renewable energy storage and power generating equipment. The objective of the company will be to offer customers a safe and dependable product at an affordable price. The company will offer a standard off the shelf lithium ion power pack assembly that can be installed easily by the end user or a licensed electrician. Unlike many other lithium ion battery packs on the market, PGD will offer a power pack assembly capable of operating at high current capacities due to a state of the art battery management system and battery design. The application of the power pack will be wide ranging from residential home solar to commercial business and even marine.
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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion of our financial condition and results of operations should be read in conjunction with the financial statements and the notes thereto of the Company, as well as the financial statements and the notes thereto, included in this Offering Circular. The following discussion contains forward-looking statements. Actual results could differ materially from the results discussed in the forward-looking statements. See “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” above.
Forward-looking Statements
Statements made in this Annual Report which are not purely historical are forward-looking statements with respect to the goals, plan objectives, intentions, expectations, financial condition, results of operations, future performance and our business, including, without limitation, (i) our ability to raise capital, and (ii) statements preceded by, followed by or that include the words "may," "would," "could," "should," "expects," "projects," "anticipates," "believes," "estimates," "plans," "intends," "targets" or similar expressions.
Forward-looking statements involve inherent risks and uncertainties, and important factors (many of which are beyond our control) that could cause actual results to differ materially from those set forth in the forward-looking statements, including the following, general economic or industry conditions, nationally and/or in the communities in which we may conduct business, changes in the interest rate environment, international gold prices, legislation or regulatory requirements, conditions of the securities markets, our ability to raise capital, changes in accounting principles, policies or guidelines, financial or political instability, acts of war or terrorism, other economic, competitive, governmental, regulatory and technical factors affecting our current or potential business and related matters.
Accordingly, results actually achieved may differ materially from expected results in these statements. Forward-looking statements speak only as of the date they are made. We do not undertake, and specifically disclaim, any obligation to update any forward-looking statements to reflect events or circumstances occurring after the date of such statements.
Results of Operations
For the Years Ended December 31, 2023 and 2022
Revenues and Cost of Sales
During the years ended December 31, 2023 and 2022, we recognized $287,564 and $169,052 in revenue and recognized $164,810 and $116,490 in cost of sales, recognizing gross margins of $122,754 and $52,562, respectively.
Operating Expenses
Operating expenses were $161,049 during the year ended December 31, 2023, compared to $114,722 during the year ended December 31, 2022. Operating expenses consisted of $78,632 and $58,919 in selling expenses and $82,417 and $55,803 in general and administrative expenses during the years ended December 31, 2023 and 2022, respectively.
Net Loss
As a result of the above, we recognized a net loss of $82,905 and $47,310 for the years ended December 31, 2023 and 2022, respectively.
We anticipate losses from operations will increase during the next twelve months due to the anticipated increased payroll expenses as we add necessary staff and increases in legal and accounting expenses associated with maintaining a reporting company. We expect that we will continue to have net losses from operations for several years until revenues from operating facilities become sufficient to offset operating expenses.
2
Liquidity and Capital Resources of the Company
Current Assets
Total assets were $43,622 and $63,261 as of December 31, 2023 and 2022, respectively. Current assets at December 31, 2023 totaled $43,622, compared to $37,284 at December 31, 2022. Current assets were comprised of $1,992 in cash and $41,630 in prepaid assets as of December 31, 2023. Current assets were comprised of $1,696 in cash, $29,900 in an investment and $5,688 in prepaid assets as of December 31, 2022.
Current Liabilities
Total liabilities as of December 31, 2023 and 2022 totaled $23,866 and $20,100, respectively, all current liabilities. The balances were composed of $23,866 and $17,900 in accounts payable and $0 and $2,200 in accrued expenses to related party as of December 31, 2023 and 2022, respectively.
At December 31, 2023 we had a working capital of $19,756, compared to $17,184 at December 31, 2022.
Net Cash Used in Operating Activities
During the year ended December 31, 2023, our operating activities used net cash of $58,804, compared to $35,307 during the year ended December 31, 2022. Uses of cash during the year ended December 31, 2023 are mainly due to the $82,905 net loss as well as $35,942 in increases in current assets. Uses are partially offset by a net increase of $18,766 in current liabilities, $14,900 in realized loss in on marketable securities and $26,377 from loss on impairment of intangible assets.
Uses of cash during the year ended December 31, 2022 are mainly due to the $47,310 net loss as well as a $14,850 unrealized gain on marketable securities, partially offset by $200 in non-cash expense related to common stock issued for services, a $7,453 decrease in prepaid assets, a $17,900 increase in accounts payable and a $1,300 increase in accrued expense, related party.
Net Cash Used in Investing Activities
During the year ended December 31, 2023 and 2022, we paid $400 and $25,977 in expenses related to filing patents, respectively.
Net Cash Provided by Financing Activities
Net cash provided by financing activities was $59,500 during the year ended December 31, 2023, compared to $60,500 for the year ended December 31, 2022. Cash provided by finance activities consists of $66,000 in proceeds from a line of credit, related party, and $59,500 from the sales of common stock for cash, partially offset by repayments on the line of credit, related party, of $66,000.
Cash provided by finance activities during the year ended December 31, 2022 consists of $52,500 in proceeds from a line of credit, related party and received $81,000 from the sales of common stock for cash, partially offset by repayment of a note payable, related party of $20,500 and repayments on the line of credit, related party, of $52,500.
Going Concern
At December 31, 2023, we had a $230,944 accumulated deficit since inception. Our current liquidity resources are not sufficient to fund anticipated level of operations for at least the next 12 months from the date these financial statements were issued. As a result, there is substantial doubt regarding the Company’ ability to continue as a going concern.
Our ability to continue operations depends on our ability to generate and grow revenue and results of operations as well as our ability to access capital markets when necessary to accomplish its strategic objectives. We expect that we will continue to incur losses for the immediate future and will need additional equity or debt financing until we can achieve profitability and positive cash flows from operating activities. Our future capital requirements for our operations will depend on many factors, including the ability to generate revenues and our ability to obtain capital. There is no assurance that we will be successful in any capital-raising efforts that it may undertake to fund operations and implement our business plan in the future.
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We had sales of $287,564 and $169,052 during the years ended December 31, 2023 and 2022, respectively, and are seeking to raise up to $5,000,000 through a private placement of our common stock to finance future sales. We have raised approximately $140,500 through December 31, 2023. The continuation of PGD as a going concern is dependent upon our ability to generate profitable operations that produce positive cash flows. If PGD is not successful, it may be forced to raise additional debt or equity financing.
The foregoing goals will increase expenses and lead to possible net losses. There is no assurance that we will ever be profitable or that debt or equity financing will be available to us. 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 we be unable to continue as a going concern. There is no assurance we will be successful in any of these goals.
Off-Balance Sheet Arrangements
We had no off-balance sheet arrangements of any kind for the years ended December 31, 2023 and 2022.
MANAGEMENT
| Name | Position | Age | Start Date |
| Paul Ogorek | CEO | 36 | August 2021 |
| Samuel Becherer | DIRECTOR | 34 | January 2022 |
SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN SECURITY HOLDERS
The following table sets forth information as to the shares of common stock beneficially owned as of December 31, 2023 by (i) each person known to us to be the beneficial owner of more than 5% of our common stock; (ii) each Director; (iii) each Executive Officer; and (iv) all of our Directors and Executive Officers as a group. Unless otherwise indicated in the footnotes following the table, the persons as to whom the information is given had sole voting and investment power over the shares of common stock shown as beneficially owned by them.
| Directors and Executive Officers or 5% or more | Amount | Percent | ||||||
| Bright Business Properties LLC | 58,800,000 | 57.9% | ||||||
| Samuel Becherer | 200,000 | 0.2% | ||||||
| Paul Ogorek | 20,000,000 | 19.7% | ||||||
INTEREST OF MANAGEMENT AND OTHERS IN CERTAIN TRANSACTIONS
During the year ended December 31, 2023, PGD Eco Solutions Inc. paid a total of $0 of wages to management.
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Report of Independent Registered Public Accounting Firm
To the Board of Directors and Stockholders PGD Eco Solutions, Inc.
Opinion on the Financial Statements
We have audited the accompanying balance sheets of PGD Eco Solutions, Inc. (the “Company”) as of December 31, 2023 and 2022 and the related statements of operations, changes in stockholders’ equity and cash flows for the years ended December 31, 2023 and 2022, and the related notes to the financial statements. In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for the years ended December 31, 2023 and 2022, in conformity with accounting principles generally accepted in the United States of America.
Going Concern
The accompanying financial statements have been prepared assuming that the entity will continue as a going concern. As discussed in Note 4 to the financial statements, the entity has suffered recurring losses from operations and has a net capital deficiency that raises substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 4. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These financial statements are the responsibility of the entity’s management. Our responsibility is to express an opinion on these financial statements based on our audits. 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 PGD Eco Solutions, Inc. in accordance with the U.S. federal securities laws and applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB and in accordance with auditing standards generally accepted in the United States of America. 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. PGD Eco Solutions, Inc. 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 entity's internal control over financial reporting. Accordingly, we express no such opinion.
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Our audits 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 audits 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 audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated in the Going Concern paragraph above is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
We have served as PGD Eco Solutions, Inc.’s auditor since 2021.
Goff Backa Alfera and Company, LLC
Pittsburgh, Pennsylvania
April 12, 2024
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PGD ECO SOLUTIONS, INC.
BALANCE SHEETS
| December 31, | ||||||||
| 2023 | 2022 | |||||||
| ASSETS | ||||||||
| Current Assets: | ||||||||
| Cash | $ | 1,992 | $ | 1,696 | ||||
| Prepaid assets | 41,630 | 5,688 | ||||||
| Investment | — | 29,900 | ||||||
| Total Current Assets | 43,622 | 37,284 | ||||||
| Other Non-Current Assets | ||||||||
| Intangible assets | — | 25,977 | ||||||
| Total Non-Current Assets | — | 25,977 | ||||||
| Total Assets | 43,622 | 63,261 | ||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Current Liabilities: | ||||||||
| Accounts payable | 23,866 | 17,900 | ||||||
| Accrued expenses, related party | — | 2,200 | ||||||
| Total Current Liabilities | 23,866 | 20,100 | ||||||
| Total Liabilities | 23,866 | 20,100 | ||||||
| Stockholders' Equity: | ||||||||
| Preferred Stock Series A; $0.001 par value, 100,000,000 shares authorized and 10,000,000 and 10,000,000 shares issued and outstanding, respectively | 10,000 | 10,000 | ||||||
| Common stock; $0.001 par value, 750,000,000 and 750,000,000 shares authorized and 101,605,000 and 101,010,000 shares issued and outstanding, respectively | 101,605 | 101,010 | ||||||
| Additional paid-in capital | 139,095 | 80,190 | ||||||
| Accumulated deficit | (230,944 | ) | (148,039 | ) | ||||
| Total Stockholders' Equity | 19,756 | 43,161 | ||||||
| Total Liabilities and Stockholders' Equity | $ | 43,622 | $ | 63,261 | ||||
See Independent Auditor’s Report and Notes to the Financial Statements
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PGD ECO SOLUTIONS, INC.
STATEMENTS OF OPERATIONS
| For the Years Ended December 31, | ||||||||
| 2023 | 2022 | |||||||
| REVENUES | ||||||||
| Power pack assembly sales | $ | 287,564 | $ | 169,052 | ||||
| Total revenues | 287,564 | 169,052 | ||||||
| COSTS OF SALES | ||||||||
| Power pack assembly sales | (164,810 | ) | (116,490 | ) | ||||
| Total cost of sales | (164,810 | ) | (116,490 | ) | ||||
| GROSS MARGIN | 122,754 | 52,562 | ||||||
| OPERATING EXPENSES | ||||||||
| Selling expenses | 78,632 | 58,919 | ||||||
| General and administrative | 82,417 | 55,803 | ||||||
| Total Operating Expenses | 161,049 | 114,722 | ||||||
| Loss From Operations | (38,295 | ) | (62,160 | ) | ||||
| OTHER INCOME (EXPENSES) | ||||||||
| Loss on asset impairment | (26,377 | ) | — | |||||
| Realized loss on investment | (14,900 | ) | — | |||||
| Interest expense | (3,333 | ) | — | |||||
| Unrealized gain on investment | — | 14,850 | ||||||
| Total Other Income (Expenses) | (44,610 | ) | 14,850 | |||||
| LOSS BEFORE INCOME TAXES | (82,905 | ) | (47,310 | ) | ||||
| Provision for income taxes | — | — | ||||||
| NET LOSS | $ | (82,905 | ) | $ | (47,310 | ) | ||
| Basic loss per common share | $ | (0.00 | ) | $ | (0.00 | ) | ||
| Basic weighted average common shares outstanding | 102,768,466 | 100,302,493 | ||||||
See Independent Auditor’s Report and Notes to the Financial Statements
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PGD ECO SOLUTIONS, INC.
STATEMENTS OF STOCKHOLDERS' EQUITY
| Preferred Stock | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Total Stockholders’ Equity | ||||||||||||||
| Shares | Amount | Shares | Amount | |||||||||||||||
| Balance, December 31, 2021 | 10,000,000 | $ | 10,000 | 100,000,000 | $ | 100,000 | $ | - | $ | (100,729) | $ | 9,271 | ||||||
| Common stock issued to founder for services | - | - | 200,000 | 200 | - | - | 200 | |||||||||||
| Common stock issued for cash | - | - | 810,000 | 810 | 80,190 | - | 81,000 | |||||||||||
| Net loss for the year ended December 31, 2022 | - | - | - | - | - | (47,310) | (47,310) | |||||||||||
| Balance, December 31, 2022 | 10,000,000 | $ | 10,000 | 101,010,000 | $ | 101,010 | $ | 80,190 | $ | (148,039) | $ | 43,161 | ||||||
| Common stock issued for cash | - | - | 595,000 | 595 | 58,905 | - | 59,500 | |||||||||||
| Net loss for the year ended December 31, 2023 | - | - | - | - | - | (82,905) | (82,905) | |||||||||||
| Balance, December 31, 2023 | 10,000,000 | $ | 10,000 | 101,605,000 | $ | 101,605 | $ | 139,095 | $ | (230,944) | $ | 19,756 | ||||||
See Independent Auditor’s Report and Notes to the Financial Statements
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PGD ECO SOLUTIONS, INC.
STATEMENTS OF CASH FLOWS
| For the Years Ended December 31, | ||||||||
| 2023 | 2022 | |||||||
| Cash Flows From Operating Activities: | ||||||||
| Net loss | $ | (82,905 | ) | $ | (47,310 | ) | ||
| Adjustments to reconcile net loss to net cash (used) by operating activities: | ||||||||
| Loss on asset impairment | 26,377 | — | ||||||
| Realized loss on investment | 14,900 | — | ||||||
| Unrealized gain on investment | — | (14,850 | ) | |||||
| Common stock issued for services | — | 200 | ||||||
| Changes in operating assets and liabilities: | ||||||||
| (Increase) decrease in prepaid assets | (35,942 | ) | 7,453 | |||||
| (Decrease) increase in accrued expenses, related party | (2,200 | ) | 1,300 | |||||
| Increase in accounts payable | 20,966 | 17,900 | ||||||
| Net cash used in operating activities | (58,804 | ) | (35,307 | ) | ||||
| Cash Flows From Investing Activities: | ||||||||
| Payment of patent filing costs | (400 | ) | (25,977 | ) | ||||
| Net cash used in investing activities | (400 | ) | (25,977 | ) | ||||
| Cash Flows From Financing Activities: | ||||||||
| Common stock issued for cash | 59,500 | 81,000 | ||||||
| Payments on note payable, related party | — | (20,500 | ) | |||||
| Proceeds from line of credit, related party | 66,000 | 52,500 | ||||||
| Payments on line of credit, related party | (66,000 | ) | (52,500 | ) | ||||
| Net cash provided by financing activities | 59,500 | 60,500 | ||||||
| Net change in cash | 296 | (784 | ) | |||||
| Cash, beginning of period | 1,696 | 2,480 | ||||||
| Cash, end of period | $ | 1,992 | $ | 1,696 | ||||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||||||||
| Cash paid for interest | $ | 3,333 | $ | — | ||||
| Cash paid for taxes | $ | — | $ | — | ||||
See Independent Auditor’s Report and Notes to the Financial Statements
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PGD ECO SOLUTIONS, INC.
FOOTNOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2023 and 2022
NOTE 1 - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
The financial statements presented are those of PGD Eco Solutions, Inc. (“PGD”, or the “Company”). PGD was incorporated on August 31, 2021, under the laws of the State of Wyoming.
PGD was incorporated to develop and build a prototype lithium-ion battery pack assembly for residential and small business commercial applications certified to industry standards.
Basis of Presentation
The Financial Statements and related disclosures have been prepared using the accrual basis of accounting in accordance with Generally Accepted Accounting Principles (“GAAP”) of the United States. PGD has elected a calendar year-end.
Cash Equivalents
PGD considers all highly liquid investments with maturities of three months or less when purchased to be cash equivalents.
Investments
The Company’s investment in a marketable equity security is classified as short-term based on the nature of the security and its availability for use in current operations. The Company’s marketable equity security is measured at fair value with gains and losses recognized in other income/(expense), net.
During the year ended December 31, 2023, the Company exchanged investments with a fair value of $29,900 at December 31, 2022 for services valued at $15,000, resulting in a realized loss on investment of $14,900 for the year ended December 31, 2023.
Patent Acquisition
The Company capitalizes costs incurred in securing patents for its prototype lithium-ion battery pack assembly. Capitalized costs are reviewed for impairment whenever indications of impairment exist. During the years ended December 31, 2023 and 2022, the Company paid and capitalized $400 and $25,977 toward the purchase of patents for technology incorporated into the Company’s prototype lithium-ion battery pack assembly. The patents were never issued and were written off as impaired during 2023, resulting in a loss on impairment of $26,377 for the year ended December 31, 2023.
Concentration of Credit Risk
The Company has one major customer that accounted for 96% and 92% of all revenue for the years ended December 31, 2023 and 2022, respectively. The Company expects to maintain good relationships with its primary customer.
Use of Estimates
The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
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PGD ECO SOLUTIONS, INC.
FOOTNOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2023 and 2022
Revenue Recognition Policy
PGD recognizes revenue in accordance with the provisions of Accounting Series Codification (“ASC”) 606, Revenue From Contracts With Customers (“ASC 606”), which provides guidance on the recognition, presentation, and disclosure of revenue in financial statements. ASC 606 outlines the basic criteria that must be met to recognize revenue and provides guidance for disclosure related to revenue recognition policies. In general, the Company recognizes revenue based on the allocation of the transaction price to each performance obligation as each performance obligation in a contract is satisfied.
During the years ended December 31, 2023 and 2022, revenue of $287,564 and $169,052 was recognized from the sale of lithium-ion battery pack assemblies, respectively. Revenue from sales of lithium-ion battery pack assemblies is recognized when the lithium-ion battery pack assembly is sold and the product is delivered to the customer.
Cost of Sales
Cost of sales includes inventory costs of parts purchased for lithium-ion battery pack assembly and resale, as well as other direct costs of assembly and freight. During the year ended December 31, 2023 and 2022, costs of sales totaling $164,810 and $116,490 were recognized on the above-mentioned sales, respectively.
Stock-Based Compensation
PGD records stock-based compensation using the fair value method. Equity instruments issued to employees and the cost of the services received as consideration are accounted for in accordance with ASC 718, Stock Compensation and are measured and recognized based on the fair value of the equity instruments issued. All transactions with non-employees in which goods or services are the consideration received for the issuance of equity instruments are accounted for in accordance with ASC 515, Equity-Based Payments to Non-Employees, based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable.
Fair Value of Financial Instruments
ASC 820, Fair Value Measurements (“ASC 820”) and ASC 825, Financial Instruments (“ASC 825”), requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. It establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument's categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. It prioritizes the inputs into three levels that may be used to measure fair value:
Level 1 - Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.
Level 2 - Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.
Level 3 - Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.
The carrying values of cash, prepaid expenses and the note payable, related party, approximate fair value. Pursuant to ASC 820 and 825, the fair value of the investment in a marketable equity security is determined based on "Level 2" inputs, which consist of quoted prices in markets with insufficient volume or infrequent transactions.
The method described above may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair value. Furthermore, while the Company believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date.
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PGD ECO SOLUTIONS, INC.
FOOTNOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2023 and 2022
The following table presents the Company’s asset that is measured at fair value on a recurring basis, consistent with the fair value hierarchy provisions,
| December 31, 2023 | ||||||||||||||||
| Quoted Prices in Active Markets for Identical Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | |||||||||||||
| Assets: | ||||||||||||||||
| Investment | $ | — | $ | — | $ | — | $ | — | ||||||||
| Total | $ | — | $ | — | $ | — | $ | — | ||||||||
| December 31, 2022 | ||||||||||||||||
| Quoted Prices in Active Markets for Identical Liabilities | Significant Other Observable Inputs | Significant Unobservable Inputs | ||||||||||||||
| (Level 1) | (Level 2) | (Level 3) | Total | |||||||||||||
| Assets: | ||||||||||||||||
| Investment | $ | — | $ | 29,900 | $ | — | $ | 29,900 | ||||||||
| Total | $ | — | $ | 29,900 | $ | — | $ | 29,900 | ||||||||
New Accounting Pronouncements
PGD has implemented all new accounting pronouncements that are in effect and that may impact its financial statements. The Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.
Basic and Diluted Loss Per Share
PGD presents basic earnings per share (EPS) on the face of the statements of operations. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period including convertible debt, stock options, and warrants, using the treasury stock method, and convertible debt instrument, using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive.
The calculation of basic net loss per share for the years ended December 31, 2023 and 2022 is as follows:
| For the Years Ended December 31, | ||||||||
| 2023 | 2022 | |||||||
| Basic Loss Per Share: | ||||||||
| Numerator: | ||||||||
| Net loss | $ | (82,905 | ) | $ | (47,310 | ) | ||
| Denominator: | ||||||||
| Weighted-average common shares outstanding | 102,768,466 | 100,302,493 | ||||||
| Basic net loss per share | $ | (0.00 | ) | $ | (0.00 | ) | ||
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PGD ECO SOLUTIONS, INC.
FOOTNOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2023 and 2022
Income Taxes
PGD files income tax returns in the U.S. federal jurisdiction, and the state of Pennsylvania. PGD’s policy is to recognize interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses.
Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.
Net deferred tax assets consist of the following components:
| For the Years Ended December 31, | ||||||||
| 2023 | 2022 | |||||||
| Net operating loss carry forward | $ | 31,116 | $ | 13,244 | ||||
| Valuation allowance | (31,116 | ) | (13,244 | ) | ||||
| Net deferred tax asset | $ | — | $ | — | ||||
The federal income tax provision differs from the amount of income tax determined by applying the U.S. federal income tax rate of 21% to pretax income from continuing operations for the years ended December 31, 2023 and 2022 due to the following:
| For the Years Ended December 31, | ||||||||
| 2023 | 2022 | |||||||
| Pre-tax book loss | $ | (17,410 | ) | $ | (9,935 | ) | ||
| Stock for services | — | 42 | ||||||
| Unrealized gain on investment | — | (3,119 | ) | |||||
| Related party accrued expenses | (462 | ) | 273 | |||||
| Valuation allowance | 17,872 | 12,739 | ||||||
| $ | — | $ | — | |||||
PGD has net operating losses of approximately $148,172 that never expire. Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carryforwards for Federal income tax reporting purposes are subject to annual limitations. Should a change in ownership occur, net operating loss carryforwards may be limited as to use in future years. In accordance with the statute of limitations for federal tax returns, the Company’s federal tax returns for the years ended December 31, 2023, 2022 and the period from August 31, 2021 through December 31, 2021 are subject to examination.
NOTE 2 - RELATED PARTY TRANSACTIONS
Note Payable
During the year ended December 31, 2022, the Company repaid $20,500 of shareholder notes payable. The balance of the notes payable was $0 and $0 at December 31, 2023 and 2022, respectively.
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PGD ECO SOLUTIONS, INC.
FOOTNOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2023 and 2022
Line of Credit
On January 1, 2022, PGD entered into a $200,000 line of credit agreement with a shareholder of the Company through December 31, 2024. During the years ended December 31, 2023 and 2022, the Company borrowed and repaid a total of $66,000 and $52,500, respectively, which resulted in a balance of $0 and $0 as of December 31, 2023 and 2022, respectively. The line of credit is unsecured, payable on demand and interest payments are payable at a rate of 5% annually on the outstanding principal balance if not paid in full.
Office Space
During February 2022, the Company entered into a lease for the use of space at the personal residence of the Company’s CEO. The lease began February 1, 2022, has a term of twenty-four months and monthly rent of $200. Rent expense was $2,400 and $2,200 for the years ended December 31, 2023 and 2022, respectively. The Company had accrued rent payable of $0 and $2,200 at December 31, 2023 and 2022, respectively.
NOTE 3 - STOCKHOLDERS’ EQUITY
Preferred Stock Series A
On August 31, 2021, the Company authorized and approved the designation of 10,000,000 shares of Series A Preferred Stock with a par value of $0.001. The Series A Preferred Stock is not subject to any mandatory dividends or distributions and ranks senior to common stock in preference in the event of any liquidation, dissolution or winding up of the Company, participating with the Common Stock on an as-converted basis. The holders of Series A Preferred Stock have 10 votes per share of Series A Preferred Stock and are entitled to vote on any and all matters brought to a vote of stockholders of Common Stock.
Common Stock
Between January and June 2023, the Company issued a total of 595,000 shares of common stock for cash of $59,500, or $0.10 per share. Amounts received in excess of $0.001 per share par value have been recorded as additional paid-in capital.
During January 2022, the Company’s Chief Executive Officer resigned and transferred his 20,000,000 founders shares to another founder, of which, 14,800,000 were retained, 5,000,000 were transferred to a newly appointed CEO and 200,000 were transferred to a newly appointed member of the board of directors.
Between June 2022 and August 2022, the Company issued a total of 810,000 shares of common stock for cash of $81,000, or $0.10 per share. Amounts received in excess of $0.001 per share par value have been recorded as additional paid-in capital.
On June 29, 2022, PGD issued 200,000 shares of common stock as founders’ shares for services valued at $200, or its par value of $0.001 per share.
NOTE 4 - GOING CONCERN
PGD's financial statements are prepared using Generally Accepted Accounting Principles applicable to a going concern that contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, PGD has recently accumulated losses since its inception and has negative cash flows from operations, which raise substantial doubt about its ability to continue as a going concern. Management's plans with respect to alleviating the adverse financial conditions that caused management to express substantial doubt about the PGD's ability to continue as a going concern are as follows:
PGD is seeking to raise up to $1,000,000 through a private placement of its common stock to finance future sales. The continuation of PGD as a going concern is dependent upon its ability to generate profitable operations that produce positive cash flows. If PGD is not successful, it may be forced to raise additional debt or equity financing.
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PGD ECO SOLUTIONS, INC.
FOOTNOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2023 and 2022
There can be no assurance that PGD will be able to achieve its business plans, raise any more required capital or secure the financing necessary to achieve its current operating plan. The ability of PGD to continue as a going concern is dependent upon its ability to successfully accomplish the plan described in the preceding paragraph and eventually attain profitable operations. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
NOTE 5 - SUBSEQUENT EVENTS
PGD reviewed subsequent events through March 5, 2024, the date the financial statements were available to be issued.
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SIGNATURES
Pursuant to the requirements of Regulation A, the issuer has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on April 26, 2024.
PGD ECO SOLUTIONS INC.
By: /s/ Paul Ogorek
Name: Paul Ogorek
Title: Chief Executive Officer and Director
Pursuant to the requirements of Regulation A, this report has been signed below by the following persons on behalf of the issuer and in the capacities on April 26, 2024.
PGD ECO SOLUTIONS, INC.
By: /s/ Paul Ogorek
Name: Paul Ogorek
Title: Chief Executive Officer and Director
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