0001144204-12-063624.txt : 20121119 0001144204-12-063624.hdr.sgml : 20121119 20121119062226 ACCESSION NUMBER: 0001144204-12-063624 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 9 CONFORMED PERIOD OF REPORT: 20120930 FILED AS OF DATE: 20121119 DATE AS OF CHANGE: 20121119 FILER: COMPANY DATA: COMPANY CONFORMED NAME: POWERDYNE INTERNATIONAL, INC. CENTRAL INDEX KEY: 0001435617 STANDARD INDUSTRIAL CLASSIFICATION: BLANK CHECKS [6770] IRS NUMBER: 205572576 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-53259 FILM NUMBER: 121213105 BUSINESS ADDRESS: STREET 1: 300 CENTERVILLE ROAD CITY: WARWICK STATE: RI ZIP: 02886 BUSINESS PHONE: 401-739-3300 MAIL ADDRESS: STREET 1: 300 CENTERVILLE ROAD CITY: WARWICK STATE: RI ZIP: 02886 FORMER COMPANY: FORMER CONFORMED NAME: Greenmark Acquisition CORP DATE OF NAME CHANGE: 20080915 FORMER COMPANY: FORMER CONFORMED NAME: Greenlight Acquisition CORP DATE OF NAME CHANGE: 20080520 10-Q 1 v328283_10q.htm FORM 10-Q

 

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

 

(Mark One)

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

 

For the quarterly period ended September 30, 2012

 

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 0-53259

 

POWERDYNE INTERNATIONAL, INC.

(Exact name of registrant as specified in its charter)

 

Delaware 20-5572576
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)  

 

300 Centerville Road

Suite 100E

Warwick, Rhode Island 02886

(Address of principal executive offices) (zip code)

 

401/739-3300

(Registrant's telephone number, including area code)

 

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.

x Yes ¨ No

 

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

 

Large Accelerated filer  ¨ Accelerated filer  ¨
Non-accelerated filer  ¨ Smaller reporting company  x
(do not check if smaller reporting company)  

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

¨ Yes x No

 

Indicate the number of shares outstanding of each of the registrant's classes of common stock as of the latest practicable date.

 

Class   Outstanding at July 20, 2012
     
Common Stock, par value $0.0001   193,216,667 shares

 

Documents incorporated by reference:            None

  

 
 

 

POWERDYNE INTERNATIONAL INC.

INDEX TO FORM 10-Q FILING

september 30, 2012 and 2011

 

TABLE OF CONTENTS

 

       

Page 

Numbers

PART I - FINANCIAL INFORMATION    
     
Item 1.   Financial Statements (unaudited)    
    Balance Sheets (unaudited)   2
    Statements of Operations (unaudited)   3
    Statements of Cash Flows (unaudited)   5
    Notes to Financial Statements (unaudited)   6
Item 2.   Management Discussion and Analysis of Financial Condition and Results of Operations   17
Item 3.   Quantitative and Qualitative Disclosures About Market Risk   19
Item 4.   Controls and Procedures   19
         
PART II - OTHER INFORMATION    
     
Item 1.   Legal Proceedings   21
Item 1A   Risk Factors   21
Item 2.   Unregistered Sales of Equity Securities and Use of Proceeds   21
Item 3.   Defaults Upon Senior Securities   21
Item 4.   Submission of Matters to a Vote of Security Holders   21
Item 5.   Other information   21
Item 6.   Exhibits   22
         
CERTIFICATIONS  
   
  Exhibit 31 – Management certification  
  Exhibit 32 – Sarbanes-Oxley Act    

 

 
 

 

PART I

 

 

POWERDYNE INTERNATIONAL, INC.

(A Development Stage Company)

BALANCE SHEETS

 

 

   September 30, 2012   December 31, 2011 
   (unaudited)     
           
ASSETS          
           
Current Assets:          
Cash  $117   $17,664 
Prepaid expenses   -    1,817 
Advances to stockholder   11,321    11,321 
Total current assets   11,438    30,802 
           
Equipment, net   119,493    129,821 
           
Total Assets  $130,931   $160,623 
           
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)          
           
Current Liabilities:          
Accounts payable and accrued expenses  $140,669   $135,626 
Due to related party   4,700    - 
Notes payable-related party   11,000     
Tax payable       956 
Total current liabilities   156,369    136,582 
Total Liabilities   156,369    136,582 
           
Stockholders' Equity (Deficit):          
Common stock; $0.0001 par value;  300,000,000 shares authorized, 193,216,667 shares issued and outstanding as of September 30, 2012 and 191,750,000 shares issued and outstanding as of December 31, 2011   19,322    19,175 
Additional paid-in capital   1,090,778    1,056,925 
Accumulated deficit   (1,135,538)   (1,052,059)
Total Stockholders' Equity (Deficit)   (25,438)   24,041 
           
Total Liabilities and Stockholders' Equity (Deficit)  $130,931   $160,623 

 

Page2The accompanying notes are an integral part of these financial statements.
 

 

 

POWERDYNE INTERNATIONAL, INC.

(A Development Stage Company)

STATEMENTS OF OPERATIONS

(Unaudited)

 

   For the three   For the three   For the Nine   For the Nine   For the period from 
   months  ended   months  ended   Months Ended   Months Ended   February 2, 2010 (inception) 
   September 30, 2012   September 30, 2011   September 30, 2012   September 30, 2011   to September 30, 2012 
                     
Revenues  $-   $-   $-   $-   $- 
Cost of revenues   -    -    -    -    - 
Gross profit   -    -    -    -    - 
Operating expenses   22,610    49,892    83,479    694,272    1,132,670 
                          
Loss from operations   (22,610)   (49,892)   (83,479)   (694,272)   (1,132,670)
                          
Income tax expense       956        1,912    2,868 
                          
Net loss  $(22,610)  $(50,848)  $(83,479)  $(696,184)  $(1,135,538)
                          
Basic and diluted loss per common share  $(0.00)  $(0.00)  $(0.00)  $(0.00)     
Basic and diluted weighted average common shares outstanding   193,216,667    190,608,696    193,093,431    191,890,110      

 

Page3The accompanying notes are an integral part of these financial statements.
 

 

 

POWERDYNE INTERNATIONAL, INC.

(A Development Stage Company)

STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)

For the period from February 2, 2010 (Inception) to September 30, 2012

 

 

               Additional           Total 
   Common Stock   Common Stock   Paid-In   Common Stock   Accumulated   Stockholders' 
   Shares   Amount   Subscribed   Capital   Subscriptions Receivable   Deficit   Equity (Deficit) 
                             
Balance, February 2, 2010 (Inception)   1,000,000   $100   $-   $900   $-   $-   $1,000 
Common stock subscribed   -    -    191,900    -    (61,915)   -    129,985 
Stock issued for change in control   188,000,000    18,800    -    (18,800)   -    -    - 
Stock issued for services   16,000,000    1,600    -    158,400    -    -    160,000 
Net loss for the period   -    -    -    -    -    (306,270)   (306,270)
                                    
Balance, December 31, 2010  (1)   205,000,000    20,500    191,900    140,500    (61,915)   (306,270)   (15,285)
                                    
Recapitalization shares contributed from                                   
reverse merger agreement   (84,526,666)   (8,453)   -    8,453    -    -    - 
Issuance pursuant to merger                                   
agreement for services - fair valued   32,500,000    3,250    -    321,750    -    -    325,000 
Issuance per cash considerations in                                   
relation to the stockholder subscription   36,026,666    3,603    (191,900)   523,997    (102,200)   -    233,500 
Common stock issued   2,750,000    275    -    62,225    164,115         226,615 
Net loss for the year   -    -    -    -    -    (745,789)   (745,789)
Balance, December 31, 2011   191,750,000    19,175    -    1,056,925    -    (1,052,059)   24,041 
                                    
Issuance per cash considerations in   -    -    -    -    -    -    - 
relation to the stockholder subscription   966,667    97    -    28,903    -    -    29,000 
Stock issued for services   500,000    50    -    4,950    -    -    5,000 
Net loss for the nine months ended 9/30/2012   -    -    -    -    -    (83,479)   (83,479)
Balance, September 30, 2012, (Unaudited)   193,216,667   $19,322   $-   $1,090,778   $-   $(1,135,538)  $(25,438)

 

(1) The capital accounts of the Company have been retroactivrly restated to reflect the equivalent number of common shares based on the exchange ratio of the merger transaction. See Note 2.

 

Page4The accompanying notes are an integral part of these financial statements.
 

 

 

POWERDYNE INTERNATIONAL, INC.

(A Development Stage Company)

STATEMENTS OF CASH FLOWS

(Unaudited)

 

   For The Nine   For The Nine   From February 2, 2010 
   Months Ended   Months Ended   (Inception) to 
   September 30, 2012   September 30, 2011   September 30, 2012 
             
Operating Activities:               
Net loss  $(83,479)  $(696,184)  $(1,135,538)
Adjustments to reconcile net loss to net cash used by operating activities:               
Depreciation and amortization   10,328    66    13,570 
Stock compensation   5,000    325,000    490,000 
Changes in operating assets and liabilities:               
Prepaid expenses   1,817    (3,409)    
Accrued expenses   5,043    89,529    140,669 
Due to related party   4,700    -    4,700 
Tax payable   (956)   -     
Net cash used in operating activities   (57,547)   (284,998)   (486,599)
                
Investing Activities:               
Purchase of equipment   -    (113,162)   (133,063)
Net cash used in investing activities   -    (113,162)   (133,063)
                
Financing Activities:               
Advances to stockholder   -    (9,927)   (11,321)
Notes payable   11,000    -    11,000 
Proceeds from issuance of common stock   29,000    452,615    620,100 
Net cash provided by financing activities   40,000    442,688    619,779 
                
Net change in cash   (17,547)   44,528    117 
Cash, beginning of period   17,664    2,059    - 
                
Cash, end of period  $117   $46,587   $117 
                
Suppplemental disclosure of cash flow information               
Cash paid for interest  $-   $-   $- 
Cash paid for taxes  $956   $-   $2,868 

 

Page5The accompanying notes are an integral part of these financial statements.
 

 

POWERDYNE INTERNATIONAL, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

September 30, 2012 and 2011

(Unaudited)

 

1. ORGANIZATION

 

Powerdyne, Inc., was incorporated on February 2, 2010 in Nevada, and is registered to do business in Rhode Island and Massachusetts. On February 7, 2011, Powerdyne, Inc. merged with Powerdyne International, Inc., formerly Greenmark Acquisition Corporation, a publicly held Delaware shell corporation with minimal assets and no operations.

 

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.

 

The Company is a start-up organization which intends to produce and distribute completely packaged independent electrical generator units that run on environmentally-friendly fuel sources, such as natural gas and propane. At this time, the majority stockholder has patents pending with the United States Patent Office regarding the unique design of these units.

 

2. REVERSE MERGER ACCOUNTING

 

On February 7, 2011, Greenmark Acquisition Corporation, which was a publicly held Delaware shell corporation with no operations 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 is being accounted for as a reverse-merger, and recapitalization in accordance with generally accepted accounting principles in the United States (“GAAP”). Powerdyne, Inc. is the acquirer for financial reporting purposes and the Company is 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 have been retroactively restated as capital stock shares reflecting the exchange ratio in the merger.

 

Page6The accompanying notes are an integral part of these financial statements.
 

 

POWERDYNE INTERNATIONAL, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

September 30, 2012 and 2011

(Unaudited)

 

2. REVERSE MERGER ACCOUNTING (CONTINUED)

 

In conjunction with the merger, the Company received no cash and assumed no liabilities from Greenmark Acquisition Corporation. All members of the Company’s executive management are from Powerdyne, Inc.

 

3. BASIS OF PRESENTATION

 

The accompanying unaudited financial statements primarily reflect the financial position, results of operations and cash flows of the Company (as discussed above). The accompanying unaudited financial statements have been prepared in accordance with GAAP for interim financial information and pursuant to the instructions to Form 10-Q and Article 8 of Regulation S-X of the Securities and Exchange Commission. Accordingly, these interim financial statements do not include all of the information and footnotes required by GAAP for annual financial statements. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the nine months ended September 30, 2012 are not necessarily indicative of the results that may be expected for the year ending December 31, 2012 or for any other period. These financial statements and accompanying notes should be read in conjunction with the financial statements and notes thereto in our Annual Report on Form 10-K for the fiscal year ended December 31, 2011 on file with the SEC (our “Annual Report”). There have been no material changes to our significant accounting policies as compared to the significant accounting policies described in our Annual Report.

 

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. The Company is classified as a development stage enterprise under GAAP and has not generated significant revenues from its principal operations.

 

Development Stage and Capital Resources

 

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. Accordingly, the Company is considered to be in the development stage as defined in GAAP. The Company has not generated significant revenues from its principal operations, and there is no assurance of future revenues. As of September 30, 2012, the Company had an accumulated deficit from inception of $1,135,538.

 

Page7The accompanying notes are an integral part of these financial statements.
 

 

POWERDYNE INTERNATIONAL, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

September 30, 2012 and 2011

(Unaudited)

 

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

The Company’s activities will necessitate significant uses of working capital beyond 2012. Additionally, the Company’s capital requirements will depend on many factors, including the success of the Company’s continued research and development efforts and the status of competitive products. The Company plans to continue financing its operations with cash received from financing activities, more specifically from one of its major shareholders.

 

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.

 

Use of Estimates

 

In preparing these 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.

 

Fair Value of Financial Instruments

 

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, based on the Company’s principal or, in the absence of a principal, most advantageous market for the specific asset or liability.

 

GAAP provides for a three-level hierarchy of inputs to valuation techniques used to measure fair value, defined as follows:

 

Level 1 — Inputs that are quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2 — Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability, including:

- Quoted prices for similar assets or liabilities in active markets

- Quoted prices for identical or similar assets or liabilities in markets that are not active.

- Inputs other than quoted prices that are observable for the asset or liability

- Inputs that are derived principally from or corroborated by observable market data by correlation or other means.

 

Page8The accompanying notes are an integral part of these financial statements.
 

 

POWERDYNE INTERNATIONAL, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

September 30, 2012 and 2011

(Unaudited)

 

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

Level 3 — Inputs that are unobservable and reflect the Company’s own assumptions about the assumptions market participants would use in pricing the asset or liability based on the best information available in the circumstances (e.g., internally derived assumptions surrounding the timing and amount of expected cash flows). The Company did not measure any financial instruments presented on the balance sheets at fair value on a recurring basis using significantly unobservable inputs (Level 3) during the nine months ended September 30, 2012 or during the year ended December 31, 2011.

 

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’s financial instruments include cash and accrued liabilities. The estimated fair value of these instruments approximates its carrying amount due to the short maturity of these instruments.

 

Management believes it is not practical to estimate the fair value of advances to stockholder because the transactions cannot be assumed to have been consummated at arm’s length, the terms are not deemed to be market terms, there are no quoted values available for these instruments, and an independent valuation would not be practical due to the lack of data regarding similar instruments, if any, and the associated potential costs.

 

Cash and Cash Equivalents

 

The Company considers all highly-liquid investments with maturities of three months or less when purchased to be cash equivalents. The Company had no cash equivalents as of September

30, 2012 and December 31, 2011.

 

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.

 

Revenue Recognition

 

The Company is in the development stage and has yet to realize revenues from planned operations.  The Company will recognize revenue on arrangements in accordance with Financial

 

Page9The accompanying notes are an integral part of these financial statements.
 

 

POWERDYNE INTERNATIONAL, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

September 30, 2012 and 2011

(Unaudited)

 

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

Accounting Standards Board Accounting Standards Codification (“ASC”) No. 605, “Revenue Recognition”.  In all cases, revenue is recognized only when the price is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting receivable is reasonably assured. The Company has not recorded any sales transactions since inception.

 

Equipment, net

 

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 machinery and equipment, previously classified as ‘construction in process’ was placed into service on October 1, 2011 and the Company began to depreciate the assets at that time. The equipment is depreciated over 10 years on a straight-line basis. Vehicles are depreciated over 5 years using the straight-line basis. Depreciation expense for the nine months ended September 30, 2012 and 2011 was $10,328 and $0, respectively, and $13,570 for the period from inception to September 30, 2012.

 

Long-Lived Assets

 

In accordance with ASC 350-30 (formerly SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets), 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 assurance 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.

 

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.

 

Page10The accompanying notes are an integral part of these financial statements.
 

 

POWERDYNE INTERNATIONAL, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

September 30, 2012 and 2011

(Unaudited)

 

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT INUED)

 

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.

 

We believe that our income tax filing positions and deductions will be sustained on audit and do not anticipate any adjustments that will result in a material change to our financial position.  Therefore, no reserves for uncertain income tax positions have been recorded pursuant to ASC 740.  In addition, we did not record a cumulative effect adjustment related to the adoption of ASC 740.  Our policy for recording interest and penalties associated with income-based tax audits is to record such items as a component of income taxes.

 

Our tax provision determined using an estimate of our 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 we update our estimate of the annual effective tax rate, and if our estimated tax rate changes, we make a cumulative adjustment. Taxes payable as of September 30, 2012 and December 31, 2011 was $0 and $956, respectively.

 

Share Based Compensation

 

The Company applies ASC 718, Share-Based Compensation to account for its service providers’ share-based payments. Common stock of the Company was given to service providers to retain their assistance in becoming a U.S. public company, assistance with public company regulations, investors’ communications and public relations with broker-dealers, market makers and other professional services.

 

In accordance with ASC 718, the Company determines whether a share payment should be classified and accounted for as a liability award or equity award. All grants of share-based payments to service providers classified as equity awards are recognized in the financial statements based on their grant date fair values which are calculated using historical pricing.

 

The Company has elected to recognize compensation expense based on the criteria that the stock awards vest immediately on the issuance date. ASC 718 requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent period if actual forfeitures differ from initial estimates. There were no forfeitures of share based compensation.

 

Page11The accompanying notes are an integral part of these financial statements.
 

 

POWERDYNE INTERNATIONAL, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

September 30, 2012 and 2011

(Unaudited)

 

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

Loss per Common Share

 

Basic loss per common share excludes dilutive securities and is computed by dividing net 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 September 30, 2012 and 2011, there were no outstanding dilutive securities.

 

The following table represents the computation of basic and diluted losses per share:

 

   Nine months   Nine months 
   ended September   ended September 
   30, 2012   30, 2011 
Loss available for common shareholder  $(83,479)  $(696,184)
Basic and fully diluted loss per share  $(0.00)  $(0.00)
           
Weighted average common shares outstanding - basic and diluted   193,093,431    191,890,110 

 

Net loss per share is based upon the weighted average shares of common stock outstanding.

 

Recent Accounting Pronouncements

 

Adopted -

 

In May 2011, the Financial Accounting Standards Board ("FASB") issued a new accounting standard on fair value measurements that clarifies the application of existing guidance and disclosure requirements, changes certain fair value measurement principles and requires additional disclosures about fair value measurements. The standard is effective for interim and annual periods beginning after December 15, 2011. Adoption of this accounting standard did not have a material impact on our financial statements and related disclosures.

 

Page12The accompanying notes are an integral part of these financial statements.
 

 

POWERDYNE INTERNATIONAL, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

September 30, 2012 and 2011

(Unaudited)

 

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

Not Adopted -

 

In December 2011, the FASB issued ASU 2011-11, Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities. The amendments in this update require an entity to disclose information about offsetting and related arrangements to enable users of its financial statements to understand the effect of those arrangements on its financial position. This update will enhance disclosures required by U.S. GAAP by requiring improved information about financial instruments and derivative instruments. The requirements of this update are effective for annual reporting periods beginning on or after January 1, 2013, and interim periods within those annual periods. Entities should provide the disclosures required retrospectively for all comparative periods presented. We are currently evaluating the impact of adopting ASU 2011-11 on the consolidated financial statements.

 

Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the United States Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future financial statements.

 

5. EQUIPMENT - NET

 

Equipment consists of the following as of September 30, 2012 and December 31, 2011:

 

   September 30, 2012   December 31, 2011 
Motor vehicles  $1,976   $1,976 
Machinery and equipment   131,087    131,087 
Less accumulated depreciation   (13,570)   (3,242)
           
Total equipment - net  $119,493   $129,821 

 

Equipment is stated at cost and depreciated on a straight-line basis over the assets’ estimated useful lives: vehicles 5 years and machinery and equipment 10 years. The machinery and equipment that was previously classified as ‘construction in process,’ was placed into service on October 1, 2011. Total depreciation expense for the nine months ended September 30, 2012 and 2011 was $10,328 and $0, respectively and from February 2, 2010 (Inception) to September 30, 2012 was $13,570.

 

6. COMMON STOCK

 

Starting in June 2010, the Company entered into various stockholder subscription agreements with private investors in order to provide working capital for the Company. The agreements were sold to private investors at $0.01 to $0.03 per share in various share amounts. The agreement stipulated that the shares of common stock would not be issued to the investors until the execution of the reverse merger agreement and subsequent Initial Public Offering. During fiscal year 2010, the Company raised $191,900 from the stockholder subscription agreements for the purchase of 19,190,000 shares of common stock. The Company had $61,915 in common stock subscription receivable as of December 31, 2010. The 19,190,000 shares of common stock were issued on February 8, 2011.

 

Page13The accompanying notes are an integral part of these financial statements.
 

 

POWERDYNE INTERNATIONAL, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

September 30, 2012 and 2011

(Unaudited)

 

6. COMMON STOCK (CONTINUED)

 

On December 11, 2010, the Company issued 2,000,000 shares of common stock to each of Tiber Creek Corporation and IRAA Fin Serv. for services rendered on behalf of Powerdyne Inc. The shares were valued at their estimated fair value of $0.01 per share for a total compensation of $40,000.

 

On December 13, 2010, the Company issued 188,000,000 to Dale Euga, the sole shareholder of Powerdyne Inc. The shares were issued to effect a change of control of the Company in anticipation of the merger that was eventually consummated with Powerdyne, Inc.

 

On December 13, 2010, the Company issued 12,000,000 shares of common stock to Arthur Read, II, Esq for services rendered on behalf of Powerdyne Inc. The shares were valued at their estimated fair value of $0.01 per share for a total compensation of $120,000.

 

On February 7, 2011, in connection with the merger, Dale Euga contributed 84,526,666 shares of common stock to the Company which were then cancelled. Mr. Euga received no compensation for these shares.

 

On February 8, 2011, the Company issued 32,500,000 shares of common stock to employees and consultants for services. The Company recorded an expense of $325,000 based on an estimated fair value of $0.01 per share.

 

Pursuant to the terms and conditions of the merger on February 7, 2011 (see Note 1 and 2) 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 Powerdyne International, Inc. common stock.

 

For the nine months ended September 30, 2012, the Company raised an additional $29,000 from stockholder subscription agreements for the purchase of 966,667 shares of common stock. In total, the Company has raised $619,100 in cash from common stock subscriptions since inception. In addition, during the same period, 500,000 shares were issued to a consultant as compensation for services rendered. The Company valued the award of stocks at $0.01 per share.

 

7. RELATED PARTY

 

The Company obtained short-term cash flow from a related party in the form of a demand Note Payable in the amount of $5,000 on July 25, 2012. The Note bears an interest rate of 7% per annum. This Note Payable is unsecured.

 

Page14The accompanying notes are an integral part of these financial statements.
 

 

POWERDYNE INTERNATIONAL, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

September 30, 2012 and 2011

(Unaudited)

 

7. RELATED PARTY (CONTINUED)

 

The Company obtained short-term cash flow from a related party in the form of a demand Note Payable in the amount of $6,000 on September 4, 2012. The Note bears an interest rate of 7% per annum. This Note Payable is unsecured

 

From time to time, the Company advances amounts to stockholders, as well as receives 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. The balance of advances to stockholder as of September 30, 2012 and December 31, 2011 was $11,321 and $11,321, respectively. Besides, as stated in Note 9, the Company has signed a real property rental agreement with a related party for its’ manufacturing facilities that begins January 1, 2012. Rent accrued, but not yet paid, as Due to Related Party at September 30, 2012 and December 31, 2011 was $2,700 and $0, respectively. The Company has an agreement with an outside consultant, a related party. Amounts paid to this consultant for the nine months ended September 30, 2012 and 2011 was $16,000 and $18,000, respectively. Amounts accrued, but not yet paid, as Due to Related Party at September 30, 2012 and December 31, 2011 was $2,000 and $0, respectively.

 

8. MEMORANDUM OF UNDERSTANDING

 

The Company entered into a Memorandum of Understanding (MoU) with Turning Mill, LLC, a Massachusetts company that has developed a business model that utilizes various federal and state renewable energy programs. The MoU sets forth a framework for the companies to begin to collaborate in the clean, renewable energy market place. This MoU expired December 31, 2011.

 

On February 6, 2012, the Company signed a “Developers License Agreement” with AMCANCO, LLC (“AMCANCO”), a limited liability corporation organized and existing in Massachusetts. AMANCO has agreed to use its resources and interest to develop renewable energy projects utilizing the Company’s generator set technology. This agreement essentially replaces the MoU with Turning Mills, LLC.

 

9. COMMITMENTS AND CONTINGENCIES

 

Lease Commitments

 

The Company entered into an operating lease agreement for its manufacturing facilities with a related party on October 1, 2011. The initial term of the lease begins January 1, 2012 and ends March 31, 2012. The Company has the option to renew the lease for an additional three month term beginning April 1, 2012. Additional three month terms are renewable at the Company’s option through December 2017. The Company shall pay this related party $300 per month, beginning January 1, 2012, for the term of the lease. In addition, The Company is responsible for utilities used at this facility.

 

Page15The accompanying notes are an integral part of these financial statements.
 

 

POWERDYNE INTERNATIONAL, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

September 30, 2012 and 2011

(Unaudited)

 

9. COMMITMENTS AND CONTINGENCIES (CONTINUED)

 

Litigation

 

During the ordinary course of the Company’s business, it is subject to various claims and litigation. Management believes that the outcome of such claims or litigation will not have a material adverse effect on the Company’s financial position, results of operations or cash flow.

 

The Company is involved in a legal settlement with a former employee of the Company. The Company is seeking reimbursement of expenses paid in the amount of $5,000. The former employee is seeking further additional expenses incurred in the amount of $6,500. It is the opinion of the Company’s legal counsel that the legal action is without merit and no accrual has been recorded for this claim.

 

10. RESTATEMENT

 

The Company has restated its financial statements for the period ended December 31, 2010. Subsequent to the filing of the original financial statements, management identified an omission in the financial statement. In December 2010, Greenmark issued 16,000,000 shares of its common stock for services rendered on behalf of Powerdyne Inc. The shares were valued at their estimated fair value of $0.01 per share for a total compensation of $160,000. The Company did not record the $160,000 expense for the services rendered. The effect of this correction was to increase net loss for the period from inception to December 31, 2010 from $146,270, as previously reported, to $306,270.

 

Page16The accompanying notes are an integral part of these financial statements.
 

 

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

The Company is a development stage company and has experienced losses since its inception. The Company's independent auditors have issued a report raising a substantial doubt about the Company's ability to continue as a going concern. The Company has not established a revenue source since inception. The only source of cash has been capital invested by shareholders and the Company has had no sales nor received revenues since inception through September 30, 2012.

 

The Company plans to manufacture, install, maintain, own and operate patented portable electrical power generation equipment (“gensets) intended to be installed at a client location. The Company has applied for a patent for its electrical power generation equipment. The Company will own, maintain and lease the equipment to the customer who will use it to produce its own supplemental electrical power. The products are intended to be portable, easy-to-use units that can be conveniently redeployed in various locations around the world. The units can also be assembled and combined to produce power centers providing up to 50 megawatts of power.

 

The following discussion contains forward-looking statements, as discussed above. Please see the sections entitled "Forward-Looking Statements" and "Risk Factors" for a discussion of the uncertainties, risks and assumptions associated with these forward-looking statements.

 

The following discussion and analysis of Powerdyne International, Inc. financial condition and results of operations are based on the unaudited financial statements as of September 30, 2012 and 2011, which were prepared in accordance with U.S. generally accepted accounting principles ("GAAP").

 

Operations

 

The Company's initial product is the PDIGenset (patent pending) which is a self-contained generator that is powered by a modified radial air cooled engine to drive a minimum of a 1-megawatt generator. The entire unit, which runs on natural gas or propane, is compact, lightweight and clean burning. As a result, the unit will produce extremely low emissions and is extremely energy-efficient.

 

The Company has recently completed a fully operational factory Series 2 prototype, which has been tested and is ready as a demonstration unit. This unit is available for any prospective customer to view in full operational capacity. In addition, the Series 2 prototype is ready to be manufactured for customers upon placement of customer orders.

 

On February 28, 2011, the Company filed with the Securities and Exchange Commission a registration statement on Form S-1 for the offer and sale of up 16,000,000 shares of Common Stock by the Company at $0.15 per share and for the offer of 71,535,166 shares of Common Stock by the holders of those shares at $0.15 per share. The Company has amended its registration to include only the registration of the 71,535,166 shares of Common Stock by the holders thereof. The registration statement has not been declared effective and no sales have been made.

 

Page17  
 

 

Overview

 

The Company plans to manufacture, install, maintain and lease its own portable electrical power equipment (for which the Company has applied for a patent). The Company plans to manufacture portable electrical power equipment intended to be installed at client locations. The Company will own, maintain and lease the equipment to the customer who will use it to produce its own supplemental electrical power. The Company's products are intended to be portable, easy-to-use units that can be conveniently redeployed in various locations around the world. The Company's units can also be assembled and combined to produce power centers providing up to 50 megawatts of power. The Company's headquarters are located in Warwick, Rhode Island and operates a manufacturing facility in Bridgewater, Massachusetts.

 

The Company will market its products in locations where inexpensive electrical power is needed and clean energy powered electrical equipment is needed and/or required.

 

Plan of Operations

 

The 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 nine months ended September 30, 2012 compared to the nine months ended September 30, 2011:

 

Revenues

 

Powerdyne International, Inc. did not generate revenues during the nine months ended September 30, 2012 and 2011.

 

Operating expenses

 

During the nine months ended September 2012 and 2011, total operating expenses were $83,479 and $694,272, respectively. The decrease related to the selling, general and administrative expenses was approximately $611,000.  This decrease resulted primarily from the decrease in officers and director salaries of approximately $147,000, of which approximately $115,000 remains accrued and unpaid, a decrease in employee stock compensation of approximately $320,000, a decrease in consulting, professional and outside services of approximately $37,000, and decreases in wages and salaries paid of approximately $30,000, travel expenses of approximately $11,000. general factory expense of $40,000, which includes expenses such as rents, parts & hardware, utilities, equipment rentals, factory supplies and insurance and a decrease in legal and accounting of $13,000.

 

Net loss

 

During the nine months ended September 30, 2012 and 2011, the net loss was $83,479 and $696,184, respectively.

 

Liquidity and Capital Resources

 

As of September 30, 2012 and December 31, 2011, Powerdyne International, Inc. had a working capital deficit of $144,931 and $105,780, respectively.   For the nine months ended September 30, 2012, Powerdyne International, Inc. had approximately $17,500 decrease in cash. The cash used in operations of approximately $57,500 was primarily due to net loss from operations of $83,479 less non-cash adjustments to net operating cash flows of approximately $10,000 of depreciation, $5,000 of employee stock compensation, the decrease of prepaid expenses of $2,000, the increase of accrued but unpaid expenses of approximately $10,000 and the decrease of approximately $1,000 in tax payable. Of the total cash provided by financing activities of approximately $40,000, $0 was used to purchase equipment and the remaining amount for working capital and operating activities.

 

Page18  
 

 

For the period from February 2, 2010 (inception) to September 30, 2012, Powerdyne International Inc. had approximately $100 of net cash increase. The cash used in operations of approximately $487,000 was primarily due to net loss from operations of $1,135,538 less non-cash adjustments to net operating cash flows of approximately $490,000 of employee stock compensation, $14,000 of depreciation, and approximately $145,000 of accrued but unpaid expenses. Of the total cash provided by financing activities of approximately $620,000, approximately $133,000 was used to purchase equipment and the remaining amount for working capital and operating activities.

 

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

 

Those material accounting policies that we believe are the most critical to an investor’s understanding of our financial results and conditions are discussed in Notes 2, 3 and 4 of the unaudited financial statements.

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

 

Information not required to be filed by Smaller Reporting Companies.

 

ITEM 4. CONTROLS AND PROCEDURES.

 

Disclosures and Procedures

 

Pursuant to Rules adopted by the Securities and Exchange Commission. the Company carried out an evaluation of the effectiveness of the design and operation of its disclosure controls and procedures pursuant to Exchange Act Rules. This evaluation was done as of the end of the fiscal year and first quarter under the supervision and with the participation of the Company's principal executive officer and principal financial and accounting officer. There have been no significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of the evaluation. Based upon that evaluation, they believe that the Company's disclosure controls and procedures are effective in gathering, analyzing and disclosing information needed to ensure that the information required to be disclosed by the Company in its periodic reports is recorded, summarized and processed timely. Both officers are directly involved in the day-to-day operations of the Company.

 

Management's Report of Internal Control over Financial Reporting

 

The Company is responsible for establishing and maintaining adequate internal control over financial reporting in accordance with the Rule 13a-15 of the Securities Exchange Act of 1934. The Company's president and principal financial and accounting officer conducted an evaluation of the effectiveness of the Company's internal control over financial reporting as of December 31, 2011, and as of September 30, 2012, based on the criteria established in Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, management concluded that the Company's internal control over financial reporting was effective as of September 30, 2011 based on those criteria. A control system can provide only reasonably, not absolute, assurance that the objectives of the control system are met and no evaluation of controls can provide absolute assurance that all control issues have been detected.

 

Page19  
 

 

Anton & Chia, the independent registered public accounting firm, 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 change in the Company's internal control procedures over financial reporting that were identified in connection with such evaluation that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.

 

Page20  
 

 

PART II

 

ITEM 1. LEGAL PROCEEDINGS

 

There are no pending, threatened or actual legal proceedings in which the Company or any subsidiary is a party in amounts over $10,000. The Company is involved with a former employee for claims of expenses for approximately $6,500.

 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

On December 11, 2010, the Company issued 4,000,000 shares of its common stock in addition to the then outstanding 1,000,000 shares of common stock. As part of the change in control effected on December 13, 2010, the Company issued 200,000,000 shares of common stock to the following shareholders in the following amounts:

 

Dale P. Euga   188,000,000 
Arthur M. Read, II   12,000,000 

 

On February 7, 2011, Mr. Euga contributed back to the Company 84,526,666 shares of his 188,000,000 common stock without remuneration.

 

Subsequent to the contribution of such shares and ending June 30, 2011, the Company issued 68,526,666 shares to officers, directors, and private investors pursuant to an exemption from registration under Section 4(2) of the Securities Act of 1933, as amended, as transactions by an issuer not involving any public offering, as follows:

 

Edwin S. Barton, II   6,833,333 
Stephen L. Caromile   6,000,000 
Linda H. Madison   1,000,000 
Eric Foster   18,000,000 
57 Investors   37,193,333 

 

Between August 8 and August 22, 2011 the Company issued 2,000,000 shares to six investors pursuant to an exemption from registration under Section 4(2) of the Securities Act of 1933, as amended, as transactions by an issuer not involving any public offering,

 

For the period ended June 30, 2012, the Company raised $29,000 from stockholder subscription agreements for the purchase of 966,667 shares of common stock. In addition, during the period ended June 30, 2012, 500,000 shares were issued to a consultant as compensation for services rendered.

 

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

 

There were no matters submitted to a vote of the security holders during the quarter covered by this report.

 

ITEM 5. OTHER INFORMATION

 

  (a) Not applicable.

 

Page21  
 

 

  (b) Item 407(c)(3) of Regulation S-K:

 

During the quarter covered by this Report, there have not been any material changes to the procedures by which security holders may recommend nominees to the Board of Directors.

 

ITEM 6. EXHIBITS

 

(a)        Exhibits

 

  31.1 Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

 

  31.2 Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

 

  32.1 Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 

  32.2 Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

  POWERDYNE INTERNATIONAL, INC.
   
  By:   /s/ Dale P. Euga
Dated: November 13, 2012 President and Principal executive officer
   
  By:   /s/ Linda H. Madison
Dated: November 13, 2012 Principal financial officer

 

Page22  

EX-31 2 v328283_ex31.htm EXHIBIT 31

 

EXHIBIT 31

 

CERTIFICATION PURSUANT TO SECTION 302

 

I, Dale P. Euga, certify that:

 

1. I have reviewed this Form 10-Q of Powerdyne International, Inc.

 

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluations; and

 

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

 

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent valuation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

 

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

 

 
 

 

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

 

Date: November 13, 2012 /s/ Dale P. Euga
  Chief Executive Officer and President

 

 
 

 

EXHIBIT 31

 

CERTIFICATION PURSUANT TO SECTION 302

 

I, Linda Madison, certify that:

 

1. I have reviewed this Form 10-Q of Powerdyne International, Inc.

 

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluations; and

 

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

 

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

 

 
 

 

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

 

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

 

 Date: November 13, 2012 /s/ Linda Madison
  Chief Financial Officer and
  Principal Accounting Officer

 

 

 

EX-32 3 v328283_ex32.htm EXHIBIT 32

 

EXHIBIT 32

 

CERTIFICATION PURSUANT TO SECTION 906

 

Pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, I, the undersigned officer of the Powerdyne International, Inc. (the "Company"), hereby certify to my knowledge that:

 

The Report on Form 10-Q for the quarter ended June 30, 2012 of the Company fully complies, in all material respects, with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and the information contained in the Report fairly represents, in all material respects, the financial condition and results of operations of the Company.

 

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

 

  /s/ Dale Euga
   President, Director,
   Chief Executive Officer

 

Date: November 13, 2012

 

 
 

  

EXHIBIT 32

 

CERTIFICATION PURSUANT TO SECTION 906

 

Pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, I, the undersigned officer of the Powerdyne International, Inc. (the "Company"), hereby certify to my knowledge that:

 

The Report on Form 10-Q for the period ended June 30, 2012 of the Company fully complies, in all material respects, with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and the information contained in the Report fairly represents, in all material respects, the financial condition and results of operations of the Company.

 

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

 

   /s/ Linda H. Madison
   Chief Accounting Officer
   Chief Financial Officer

 

Date: November 13, 2012

 

 

 

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COMMON STOCK (Details Textual) (USD $)
9 Months Ended 11 Months Ended 32 Months Ended 9 Months Ended 11 Months Ended 9 Months Ended 11 Months Ended 12 Months Ended 11 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Dec. 31, 2010
Sep. 30, 2012
Sep. 30, 2012
Private Placement [Member]
Dec. 31, 2010
Related Party One [Member]
Dec. 31, 2010
Related Party Two [Member]
Dec. 31, 2010
Related Party Three [Member]
Sep. 30, 2012
Common Stock [Member]
Dec. 31, 2010
Common Stock [Member]
Dec. 31, 2011
Common Stock [Member]
Dec. 31, 2010
Common Stock Subscribed [Member]
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares                 7,520      
Stock Issued During Period Shares Issued For Services           2,000,000 12,000,000 12,000,000        
Stock Issued For Services Estimated Fairvalue     $ 40,000                  
Stock Issued For Services Estimated Fairvalue Per Share (in dollars per share)     $ 0.01         $ 0.01        
Proceeds from issuance of common stock 29,000 452,615   620,100 29,000           619,100  
Stock Issued During Period Value Issued For Services (in dollars) 5,000   160,000         120,000        
Business Acquisition, Contingent Consideration, Shares Issuable                   188,000,000    
Stock Issued In Private Placement Minimum Issue Price (in dollars per share)     $ 0.01                  
Stock Issued In Private Placement Maximum Issue Price (in dollars per share)     $ 0.03                  
Adjustments To Additional Paid In Capital Common Stock Subscribed (in dollars)     129,985                 191,900
Adjustments To Additional Paid In Capital Common Stock Subscribed (In Shares)                       19,190,000
Common stock subscritions receivable     61,915                  
Recapitalization shares contributed from reverse merger agreement (in shares)                     84,526,666  
Issuance pursuant to merger agreement for services - fair valued (in shares)                     32,500,000  
Allocated Share-based Compensation Expense                     $ 325,000  
Common stock issued (in shares)         966,667              
Stock Issued During Period, Shares Issued For Services, Exercise Price                     $ 0.01  
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BASIS OF PRESENTATION
9 Months Ended
Sep. 30, 2012
Organization, Consolidation and Presentation Of Financial Statements [Abstract]  
Basis of Accounting [Text Block]

3. BASIS OF PRESENTATION

 

The accompanying unaudited financial statements primarily reflect the financial position, results of operations and cash flows of the Company (as discussed above). The accompanying unaudited financial statements have been prepared in accordance with GAAP for interim financial information and pursuant to the instructions to Form 10-Q and Article 8 of Regulation S-X of the Securities and Exchange Commission. Accordingly, these interim financial statements do not include all of the information and footnotes required by GAAP for annual financial statements. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the nine months ended September 30, 2012 are not necessarily indicative of the results that may be expected for the year ending December 31, 2012 or for any other period. These financial statements and accompanying notes should be read in conjunction with the financial statements and notes thereto in our Annual Report on Form 10-K for the fiscal year ended December 31, 2011 on file with the SEC (our “Annual Report”). There have been no material changes to our significant accounting policies as compared to the significant accounting policies described in our Annual Report.

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RESTATEMENT (Details Textual) (USD $)
3 Months Ended 9 Months Ended 11 Months Ended 12 Months Ended 32 Months Ended 12 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
Sep. 30, 2011
Dec. 31, 2010
Dec. 31, 2011
Sep. 30, 2012
Dec. 31, 2010
Restatement Adjustment [Member]
Stock Issued During Period, Shares, Issued For Services               16,000,000
Fair Value Of Common Stock Issued During Period               $ 0.01
Stock Issued During Period Value Issued For Services (in dollars)     $ 5,000   $ 160,000     $ 160,000
Expenses For Services               160,000
Restatement Of Prior Year Income, Net Of Tax         146,270      
Net Income (Loss) Attributable To Parent $ (22,610) $ (50,848) $ (83,479) $ (696,184) $ (306,270) $ (745,789) $ (1,135,538)  
XML 15 R8.htm IDEA: XBRL DOCUMENT v2.4.0.6
REVERSE MERGER ACCOUNTING
9 Months Ended
Sep. 30, 2012
Business Combinations [Abstract]  
Business Combination Disclosure [Text Block]

2. REVERSE MERGER ACCOUNTING

 

On February 7, 2011, Greenmark Acquisition Corporation, which was a publicly held Delaware shell corporation with no operations 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 is being accounted for as a reverse-merger, and recapitalization in accordance with generally accepted accounting principles in the United States (“GAAP”). Powerdyne, Inc. is the acquirer for financial reporting purposes and the Company is 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 have been 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. All members of the Company’s executive management are from Powerdyne, Inc.

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BALANCE SHEETS (USD $)
Sep. 30, 2012
Dec. 31, 2011
ASSETS    
Cash $ 117 $ 17,664
Prepaid expenses 0 1,817
Advances to stockholder 11,321 11,321
Total current assets 11,438 30,802
Equipment, net 119,493 129,821
Total Assets 130,931 160,623
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)    
Accounts payable and accrued expenses 140,669 135,626
Due to related party 4,700 0
Notes payable-related party 11,000 0
Tax payable 0 956
Total current liabilities 156,369 136,582
Total Liabilities 156,369 136,582
Stockholders' Equity (Deficit):    
Common stock; $0.0001 par value; 300,000,000 shares authorized, 193,216,667 shares issued and outstanding as of September 30, 2012 and 191,750,000 shares issued and outstanding as of December 31, 2011 19,322 19,175
Additional paid-in capital 1,090,778 1,056,925
Accumulated deficit (1,135,538) (1,052,059)
Total Stockholders' Equity (Deficit) (25,438) 24,041
Total Liabilities and Stockholders' Equity (Deficit) $ 130,931 $ 160,623
XML 18 R6.htm IDEA: XBRL DOCUMENT v2.4.0.6
STATEMENTS OF CASH FLOWS (USD $)
9 Months Ended 32 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
Operating Activities:      
Net loss $ (83,479) $ (696,184) $ (1,135,538)
Adjustments to reconcile net loss to net cash used by operating activities:      
Depreciation and amortization 10,328 66 13,570
Stock compensation 5,000 325,000 490,000
Changes in operating assets and liabilities:      
Prepaid expenses 1,817 (3,409) 0
Accrued expenses 5,043 89,529 140,669
Due to related party 4,700 0 4,700
Tax payable (956) 0 0
Net cash used in operating activities (57,547) (284,998) (486,599)
Investing Activities:      
Purchase of equipment 0 (113,162) (133,063)
Net cash used in investing activities 0 (113,162) (133,063)
Financing Activities:      
Advances to stockholder 0 (9,927) (11,321)
Notes payable 11,000 0 11,000
Proceeds from issuance of common stock 29,000 452,615 620,100
Net cash provided by financing activities 40,000 442,688 619,779
Net change in cash (17,547) 44,528 117
Cash, beginning of period 17,664 2,059 0
Cash, end of period 117 46,587 117
Suppplemental disclosure of cash flow information      
Cash paid for interest 0 0 0
Cash paid for taxes $ 956 $ 0 $ 2,868
XML 19 R22.htm IDEA: XBRL DOCUMENT v2.4.0.6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Textual) (USD $)
9 Months Ended 32 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
Dec. 31, 2011
Development Stage Enterprise, Deficit Accumulated During Development Stage $ 1,135,538   $ 1,135,538 $ 1,052,059
Depreciation, Depletion and Amortization 10,328 66 13,570  
Accrued Income Taxes, Current $ 0   $ 0 $ 956
Property, Plant and Equipment, Depreciation Methods straight-line basis      
Vehicles [Member]
       
Property, Plant and Equipment, Useful Life 5 years      
Equipment [Member]
       
Property, Plant and Equipment, Useful Life 10 years      
Property, Plant and Equipment, Depreciation Methods straight-line basis      
XML 20 R24.htm IDEA: XBRL DOCUMENT v2.4.0.6
EQUIPMENT - NET (Details Textual) (USD $)
9 Months Ended 32 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
Property, Plant and Equipment, Depreciation Methods straight-line basis    
Depreciation and amortization $ 10,328 $ 66 $ 13,570
Vehicles [Member]
     
Property, Plant and Equipment, Estimated Useful Lives 5 years    
Machinery and Equipment [Member]
     
Property, Plant and Equipment, Estimated Useful Lives 10 years    
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XML 22 R7.htm IDEA: XBRL DOCUMENT v2.4.0.6
ORGANIZATION
9 Months Ended
Sep. 30, 2012
Organization, Consolidation and Presentation Of Financial Statements [Abstract]  
Nature of Operations [Text Block]

1. ORGANIZATION

 

Powerdyne, Inc., was incorporated on February 2, 2010 in Nevada, and is registered to do business in Rhode Island and Massachusetts. On February 7, 2011, Powerdyne, Inc. merged with Powerdyne International, Inc., formerly Greenmark Acquisition Corporation, a publicly held Delaware shell corporation with minimal assets and no operations.

 

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.

 

The Company is a start-up organization which intends to produce and distribute completely packaged independent electrical generator units that run on environmentally-friendly fuel sources, such as natural gas and propane. At this time, the majority stockholder has patents pending with the United States Patent Office regarding the unique design of these units.

XML 23 R3.htm IDEA: XBRL DOCUMENT v2.4.0.6
BALANCE SHEETS [Parenthetical] (USD $)
Sep. 30, 2012
Dec. 31, 2011
Common stock, par value (in dollars per share) $ 0.0001 $ 0.0001
Common stock, shares authorized 300,000,000 300,000,000
Common stock, shares issued 193,216,667 191,750,000
Common stock, shares outstanding 193,216,667 191,750,000
XML 24 R17.htm IDEA: XBRL DOCUMENT v2.4.0.6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)
9 Months Ended
Sep. 30, 2012
Accounting Policies [Abstract]  
Development Stage And Capital Resources Policy [Policy Text Block]

Development Stage and Capital Resources

 

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. Accordingly, the Company is considered to be in the development stage as defined in GAAP. The Company has not generated significant revenues from its principal operations, and there is no assurance of future revenues. As of September 30, 2012, the Company had an accumulated deficit from inception of $1,135,538.

 

The Company’s activities will necessitate significant uses of working capital beyond 2012. Additionally, the Company’s capital requirements will depend on many factors, including the success of the Company’s continued research and development efforts and the status of competitive products. The Company plans to continue financing its operations with cash received from financing activities, more specifically from one of its major shareholders.

 

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.

Use of Estimates, Policy [Policy Text Block]

Use of Estimates

 

In preparing these 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.

Fair Value of Financial Instruments, Policy [Policy Text Block]

Fair Value of Financial Instruments

 

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, based on the Company’s principal or, in the absence of a principal, most advantageous market for the specific asset or liability.

 

GAAP provides for a three-level hierarchy of inputs to valuation techniques used to measure fair value, defined as follows:

 

Level 1 — Inputs that are quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2 — Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability, including:

- Quoted prices for similar assets or liabilities in active markets

- Quoted prices for identical or similar assets or liabilities in markets that are not active.

- Inputs other than quoted prices that are observable for the asset or liability

- Inputs that are derived principally from or corroborated by observable market data by correlation or other means.

  

Level 3 — Inputs that are unobservable and reflect the Company’s own assumptions about the assumptions market participants would use in pricing the asset or liability based on the best information available in the circumstances (e.g., internally derived assumptions surrounding the timing and amount of expected cash flows). The Company did not measure any financial instruments presented on the balance sheets at fair value on a recurring basis using significantly unobservable inputs (Level 3) during the nine months ended September 30, 2012 or during the year ended December 31, 2011.

 

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’s financial instruments include cash and accrued liabilities. The estimated fair value of these instruments approximates its carrying amount due to the short maturity of these instruments.

 

Management believes it is not practical to estimate the fair value of advances to stockholder because the transactions cannot be assumed to have been consummated at arm’s length, the terms are not deemed to be market terms, there are no quoted values available for these instruments, and an independent valuation would not be practical due to the lack of data regarding similar instruments, if any, and the associated potential costs.

Cash and Cash Equivalents, Policy [Policy Text Block]

Cash and Cash Equivalents

 

The Company considers all highly-liquid investments with maturities of three months or less when purchased to be cash equivalents. The Company had no cash equivalents as of September

30, 2012 and December 31, 2011.

Concentration Risk Credit Risk [Policy Text Block]

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.

Revenue Recognition, Policy [Policy Text Block]

Revenue Recognition

 

The Company is in the development stage and has yet to realize revenues from planned operations.  The Company will recognize revenue on arrangements in accordance with Financial

  

Accounting Standards Board Accounting Standards Codification (“ASC”) No. 605, “Revenue Recognition”.  In all cases, revenue is recognized only when the price is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting receivable is reasonably assured. The Company has not recorded any sales transactions since inception.

Property, Plant and Equipment, Policy [Policy Text Block]

Equipment, net

 

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 machinery and equipment, previously classified as ‘construction in process’ was placed into service on October 1, 2011 and the Company began to depreciate the assets at that time. The equipment is depreciated over 10 years on a straight-line basis. Vehicles are depreciated over 5 years using the straight-line basis. Depreciation expense for the nine months ended September 30, 2012 and 2011 was $10,328 and $0, respectively, and $13,570 for the period from inception to September 30, 2012.

Impairment or Disposal of Long-Lived Assets, Policy [Policy Text Block]

Long-Lived Assets

 

In accordance with ASC 350-30 (formerly SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets), 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 assurance 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.

Income Tax, Policy [Policy Text Block]

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.

  

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.

 

We believe that our income tax filing positions and deductions will be sustained on audit and do not anticipate any adjustments that will result in a material change to our financial position.  Therefore, no reserves for uncertain income tax positions have been recorded pursuant to ASC 740.  In addition, we did not record a cumulative effect adjustment related to the adoption of ASC 740.  Our policy for recording interest and penalties associated with income-based tax audits is to record such items as a component of income taxes.

 

Our tax provision determined using an estimate of our 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 we update our estimate of the annual effective tax rate, and if our estimated tax rate changes, we make a cumulative adjustment. Taxes payable as of September 30, 2012 and December 31, 2011 was $0 and $956, respectively.

Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block]

Share Based Compensation

 

The Company applies ASC 718, Share-Based Compensation to account for its service providers’ share-based payments. Common stock of the Company was given to service providers to retain their assistance in becoming a U.S. public company, assistance with public company regulations, investors’ communications and public relations with broker-dealers, market makers and other professional services.

 

In accordance with ASC 718, the Company determines whether a share payment should be classified and accounted for as a liability award or equity award. All grants of share-based payments to service providers classified as equity awards are recognized in the financial statements based on their grant date fair values which are calculated using historical pricing.

 

The Company has elected to recognize compensation expense based on the criteria that the stock awards vest immediately on the issuance date. ASC 718 requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent period if actual forfeitures differ from initial estimates. There were no forfeitures of share based compensation.

Earnings Per Share, Policy [Policy Text Block]

Loss per Common Share

 

Basic loss per common share excludes dilutive securities and is computed by dividing net 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 September 30, 2012 and 2011, there were no outstanding dilutive securities.

 

The following table represents the computation of basic and diluted losses per share:

 

    Nine months     Nine months  
    ended September     ended September  
    30, 2012     30, 2011  
Loss available for common shareholder   $ (83,479 )   $ (696,184 )
Basic and fully diluted loss per share   $ (0.00 )   $ (0.00 )
                 
Weighted average common shares outstanding - basic and diluted     193,093,431       191,890,110  

 

Net loss per share is based upon the weighted average shares of common stock outstanding.

New Accounting Pronouncements Policy [Policy Text Block]

Recent Accounting Pronouncements

 

Adopted -

 

In May 2011, the Financial Accounting Standards Board ("FASB") issued a new accounting standard on fair value measurements that clarifies the application of existing guidance and disclosure requirements, changes certain fair value measurement principles and requires additional disclosures about fair value measurements. The standard is effective for interim and annual periods beginning after December 15, 2011. Adoption of this accounting standard did not have a material impact on our financial statements and related disclosures.

  

Not Adopted -

 

In December 2011, the FASB issued ASU 2011-11, Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities. The amendments in this update require an entity to disclose information about offsetting and related arrangements to enable users of its financial statements to understand the effect of those arrangements on its financial position. This update will enhance disclosures required by U.S. GAAP by requiring improved information about financial instruments and derivative instruments. The requirements of this update are effective for annual reporting periods beginning on or after January 1, 2013, and interim periods within those annual periods. Entities should provide the disclosures required retrospectively for all comparative periods presented. We are currently evaluating the impact of adopting ASU 2011-11 on the consolidated financial statements.

 

Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the United States Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future financial statements.

XML 25 R1.htm IDEA: XBRL DOCUMENT v2.4.0.6
DOCUMENT ENTITY INFORMATION
9 Months Ended
Sep. 30, 2012
Jul. 20, 2012
Entity Registrant Name POWERDYNE INTERNATIONAL, INC.  
Entity Central Index Key 0001435617  
Current Fiscal Year End Date --12-31  
Entity Filer Category Smaller Reporting Company  
Trading Symbol pwdi  
Entity Common Stock, Shares Outstanding   193,216,667
Document Type 10-Q  
Amendment Flag false  
Document Period End Date Sep. 30, 2012  
Document Fiscal Period Focus Q3  
Document Fiscal Year Focus 2012  
XML 26 R18.htm IDEA: XBRL DOCUMENT v2.4.0.6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)
9 Months Ended
Sep. 30, 2012
Accounting Policies [Abstract]  
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]

The following table represents the computation of basic and diluted losses per share:

 

    Nine months     Nine months  
    ended September     ended September  
    30, 2012     30, 2011  
Loss available for common shareholder   $ (83,479 )   $ (696,184 )
Basic and fully diluted loss per share   $ (0.00 )   $ (0.00 )
                 
Weighted average common shares outstanding - basic and diluted     193,093,431       191,890,110
XML 27 R4.htm IDEA: XBRL DOCUMENT v2.4.0.6
STATEMENTS OF OPERATIONS (USD $)
3 Months Ended 9 Months Ended 32 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
Revenues $ 0 $ 0 $ 0 $ 0 $ 0
Cost of revenues 0 0 0 0 0
Gross profit 0 0 0 0 0
Operating expenses 22,610 49,892 83,479 694,272 1,132,670
Loss from operations (22,610) (49,892) (83,479) (694,272) (1,132,670)
Income tax expense 0 956 0 1,912 2,868
Net loss $ (22,610) $ (50,848) $ (83,479) $ (696,184) $ (1,135,538)
Basic and diluted loss per common share (in dollars per share) $ 0.00 $ 0.00 $ 0.00 $ 0.00  
Basic and diluted weighted average common shares outstanding (in shares) 193,216,667 190,608,696 193,093,431 191,890,110  
XML 28 R12.htm IDEA: XBRL DOCUMENT v2.4.0.6
COMMON STOCK
9 Months Ended
Sep. 30, 2012
Stockholders Equity Note [Abstract]  
Stockholders' Equity Note Disclosure [Text Block]

6. COMMON STOCK

 

Starting in June 2010, the Company entered into various stockholder subscription agreements with private investors in order to provide working capital for the Company. The agreements were sold to private investors at $0.01 to $0.03 per share in various share amounts. The agreement stipulated that the shares of common stock would not be issued to the investors until the execution of the reverse merger agreement and subsequent Initial Public Offering. During fiscal year 2010, the Company raised $191,900 from the stockholder subscription agreements for the purchase of 19,190,000 shares of common stock. The Company had $61,915 in common stock subscription receivable as of December 31, 2010. The 19,190,000 shares of common stock were issued on February 8, 2011.

 

On December 11, 2010, the Company issued 2,000,000 shares of common stock to each of Tiber Creek Corporation and IRAA Fin Serv. for services rendered on behalf of Powerdyne Inc. The shares were valued at their estimated fair value of $0.01 per share for a total compensation of $40,000.

 

On December 13, 2010, the Company issued 188,000,000 to Dale Euga, the sole shareholder of Powerdyne Inc. The shares were issued to effect a change of control of the Company in anticipation of the merger that was eventually consummated with Powerdyne, Inc.

 

On December 13, 2010, the Company issued 12,000,000 shares of common stock to Arthur Read, II, Esq for services rendered on behalf of Powerdyne Inc. The shares were valued at their estimated fair value of $0.01 per share for a total compensation of $120,000.

 

On February 7, 2011, in connection with the merger, Dale Euga contributed 84,526,666 shares of common stock to the Company which were then cancelled. Mr. Euga received no compensation for these shares.

 

On February 8, 2011, the Company issued 32,500,000 shares of common stock to employees and consultants for services. The Company recorded an expense of $325,000 based on an estimated fair value of $0.01 per share.

 

Pursuant to the terms and conditions of the merger on February 7, 2011 (see Note 1 and 2) 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 Powerdyne International, Inc. common stock.

 

For the nine months ended September 30, 2012, the Company raised an additional $29,000 from stockholder subscription agreements for the purchase of 966,667 shares of common stock. In total, the Company has raised $619,100 in cash from common stock subscriptions since inception. In addition, during the same period, 500,000 shares were issued to a consultant as compensation for services rendered. The Company valued the award of stocks at $0.01 per share.

XML 29 R11.htm IDEA: XBRL DOCUMENT v2.4.0.6
EQUIPMENT - NET
9 Months Ended
Sep. 30, 2012
Property, Plant and Equipment [Abstract]  
Property, Plant and Equipment Disclosure [Text Block]

5. EQUIPMENT - NET

 

 Equipment consists of the following as of September 30, 2012 and December 31, 2011:

 

    September 30, 2012     December 31, 2011  
Motor vehicles   $ 1,976     $ 1,976  
Machinery and equipment     131,087       131,087  
Less accumulated depreciation     (13,570 )     (3,242 )
                 
Total equipment - net   $ 119,493     $ 129,821  

 

Equipment is stated at cost and depreciated on a straight-line basis over the assets’ estimated useful lives: vehicles 5 years and machinery and equipment 10 years. The machinery and equipment that was previously classified as ‘construction in process,’ was placed into service on October 1, 2011. Total depreciation expense for the nine months ended September 30, 2012 and 2011 was $10,328 and $0, respectively and from February 2, 2010 (Inception) to September 30, 2012 was $13,570.

XML 30 R23.htm IDEA: XBRL DOCUMENT v2.4.0.6
EQUIPMENT - NET (Details) (USD $)
Sep. 30, 2012
Dec. 31, 2011
Motor vehicles $ 1,976 $ 1,976
Machinery and equipment 131,087 131,087
Less accumulated depreciation (13,570) (3,242)
Total equipment - net $ 119,493 $ 129,821
XML 31 R19.htm IDEA: XBRL DOCUMENT v2.4.0.6
EQUIPMENT - NET (Tables)
9 Months Ended
Sep. 30, 2012
Property, Plant and Equipment [Abstract]  
Property, Plant and Equipment [Table Text Block]

Equipment consists of the following as of September 30, 2012 and December 31, 2011:

 

    September 30, 2012     December 31, 2011  
Motor vehicles   $ 1,976     $ 1,976  
Machinery and equipment     131,087       131,087  
Less accumulated depreciation     (13,570 )     (3,242 )
                 
Total equipment - net   $ 119,493     $ 129,821  
XML 32 R15.htm IDEA: XBRL DOCUMENT v2.4.0.6
COMMITMENTS AND CONTINGENCIES
9 Months Ended
Sep. 30, 2012
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies Disclosure [Text Block]

9. COMMITMENTS AND CONTINGENCIES

 

Lease Commitments
 

The Company entered into an operating lease agreement for its manufacturing facilities with a related party on October 1, 2011. The initial term of the lease begins January 1, 2012 and ends March 31, 2012. The Company has the option to renew the lease for an additional three month term beginning April 1, 2012. Additional three month terms are renewable at the Company’s option through December 2017. The Company shall pay this related party $300 per month, beginning January 1, 2012, for the term of the lease. In addition, The Company is responsible for utilities used at this facility.

 

Litigation

 

During the ordinary course of the Company’s business, it is subject to various claims and litigation. Management believes that the outcome of such claims or litigation will not have a material adverse effect on the Company’s financial position, results of operations or cash flow.

 

The Company is involved in a legal settlement with a former employee of the Company. The Company is seeking reimbursement of expenses paid in the amount of $5,000. The former employee is seeking further additional expenses incurred in the amount of $6,500. It is the opinion of the Company’s legal counsel that the legal action is without merit and no accrual has been recorded for this claim.

XML 33 R13.htm IDEA: XBRL DOCUMENT v2.4.0.6
RELATED PARTY
9 Months Ended
Sep. 30, 2012
Related Party Transactions [Abstract]  
Related Party Transactions Disclosure [Text Block]

7. RELATED PARTY

 

The Company obtained short-term cash flow from a related party in the form of a demand Note Payable in the amount of $5,000 on July 25, 2012. The Note bears an interest rate of 7% per annum. This Note Payable is unsecured.

  

The Company obtained short-term cash flow from a related party in the form of a demand Note Payable in the amount of $6,000 on September 4, 2012. The Note bears an interest rate of 7% per annum. This Note Payable is unsecured

 

From time to time, the Company advances amounts to stockholders, as well as receives 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. The balance of advances to stockholder as of September 30, 2012 and December 31, 2011 was $11,321 and $11,321, respectively. Besides, as stated in Note 9, the Company has signed a real property rental agreement with a related party for its’ manufacturing facilities that begins January 1, 2012. Rent accrued, but not yet paid, as Due to Related Party at September 30, 2012 and December 31, 2011 was $2,700 and $0, respectively. The Company has an agreement with an outside consultant, a related party. Amounts paid to this consultant for the nine months ended September 30, 2012 and 2011 was $16,000 and $18,000, respectively. Amounts accrued, but not yet paid, as Due to Related Party at September 30, 2012 and December 31, 2011 was $2,000 and $0, respectively.

XML 34 R14.htm IDEA: XBRL DOCUMENT v2.4.0.6
MEMORANDUM OF UNDERSTANDING
9 Months Ended
Sep. 30, 2012
Memorandum Of Understanding [Abstract]  
Memorandum Of Understanding [Text Block]

8. MEMORANDUM OF UNDERSTANDING

 

The Company entered into a Memorandum of Understanding (MoU) with Turning Mill, LLC, a Massachusetts company that has developed a business model that utilizes various federal and state renewable energy programs. The MoU sets forth a framework for the companies to begin to collaborate in the clean, renewable energy market place. This MoU expired December 31, 2011.

 

On February 6, 2012, the Company signed a “Developers License Agreement” with AMCANCO, LLC (“AMCANCO”), a limited liability corporation organized and existing in Massachusetts. AMANCO has agreed to use its resources and interest to develop renewable energy projects utilizing the Company’s generator set technology. This agreement essentially replaces the MoU with Turning Mills, LLC.

XML 35 R16.htm IDEA: XBRL DOCUMENT v2.4.0.6
RESTATEMENT
9 Months Ended
Sep. 30, 2012
Restatement Of Prior Year Income [Abstract]  
Restatement To Prior Year Income Disclosure [Text Block]

10. RESTATEMENT

 

The Company has restated its financial statements for the period ended December 31, 2010. Subsequent to the filing of the original financial statements, management identified an omission in the financial statement. In December 2010, Greenmark issued 16,000,000 shares of its common stock for services rendered on behalf of Powerdyne Inc. The shares were valued at their estimated fair value of $0.01 per share for a total compensation of $160,000. The Company did not record the $160,000 expense for the services rendered. The effect of this correction was to increase net loss for the period from inception to December 31, 2010 from $146,270, as previously reported, to $306,270.

XML 36 R21.htm IDEA: XBRL DOCUMENT v2.4.0.6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $)
3 Months Ended 9 Months Ended 11 Months Ended 12 Months Ended 32 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2012
Sep. 30, 2011
Dec. 31, 2010
Dec. 31, 2011
Sep. 30, 2012
Loss available for common shareholder $ (22,610) $ (50,848) $ (83,479) $ (696,184) $ (306,270) $ (745,789) $ (1,135,538)
Basic and fully diluted loss per share (in dollars per share) $ 0.00 $ 0.00 $ 0.00 $ 0.00      
Weighted average common shares outstanding - basic and diluted (in shares) 193,216,667 190,608,696 193,093,431 191,890,110      
XML 37 R26.htm IDEA: XBRL DOCUMENT v2.4.0.6
RELATED PARTY (Details Textual) (USD $)
9 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Sep. 04, 2012
Jul. 25, 2012
Dec. 31, 2011
Due From Officers Or Stockholders, Current $ 11,321       $ 11,321
Unsecured Demand Notes     6,000 5,000  
Unsecured Interest Bearing Interest Rate     7.00% 7.00%  
Accrued Rent, Current 2,700       0
Payments To Related Party 16,000 18,000      
Accrued Expense Due To Related Party $ 2,000       $ 0
XML 38 R5.htm IDEA: XBRL DOCUMENT v2.4.0.6
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT) (USD $)
Common Stock [Member]
Common Stock Subscribed [Member]
Additional Paid-In Capital [Member]
Common Stock Subscriptions Receivable [Member]
Retained Earnings [Member]
Total
Balance at Feb. 01, 2010 $ 100 $ 0 $ 900 $ 0 $ 0 $ 1,000
Balance (in shares) at Feb. 01, 2010 1,000,000          
Common stock subscribed 0 191,900 0 (61,915) 0 129,985
Common stock issued 18,800 0 (18,800) 0 0 0
Common stock issued (in shares) 188,000,000          
Stock issued for services 1,600 0 158,400 0 0 160,000
Stock issued for services (in shares) 16,000,000          
Net loss for the period 0 0 0 0 (306,270) (306,270)
Balance at Dec. 31, 2010 [1] 20,500 191,900 140,500 (61,915) (306,270) (15,285)
Balance (in shares) at Dec. 31, 2010 [1] 205,000,000          
Recapitalization shares contributed from reverse merger agreement (8,453) 0 8,453 0 0 0
Recapitalization shares contributed from reverse merger agreement (in shares) (84,526,666)          
Issuance pursuant to merger agreement for services - fair valued 3,250 0 321,750 0 0 325,000
Issuance pursuant to merger agreement for services - fair valued (in shares) 32,500,000          
Issuance per cash considerations in relation to the stockholder subscription 3,603 (191,900) 523,997 (102,200) 0 233,500
Issuance per cash considerations in relation to the stockholder subscription (in shares) 36,026,666          
Common stock issued 275 0 62,225 164,115   226,615
Common stock issued (in shares) 2,750,000          
Net loss for the period 0 0 0 0 (745,789) (745,789)
Balance at Dec. 31, 2011 19,175 0 1,056,925 0 (1,052,059) 24,041
Balance (in shares) at Dec. 31, 2011 191,750,000          
Issuance per cash considerations in relation to the stockholder subscription 97 0 28,903 0 0 29,000
Issuance per cash considerations in relation to the stockholder subscription (in shares) 966,667          
Stock issued for services 50 0 4,950 0 0 5,000
Stock issued for services (in shares) 500,000          
Net loss for the period 0 0 0 0 (83,479) (83,479)
Balance at Sep. 30, 2012 $ 19,322 $ 0 $ 1,090,778 $ 0 $ (1,135,538) $ (25,438)
Balance (in shares) at Sep. 30, 2012 193,216,667          
[1] The capital accounts of the Company have been retroactivrly restated to reflect the equivalent number of common shares based on the exchange ratio of the merger transaction. See Note 2.
XML 39 R10.htm IDEA: XBRL DOCUMENT v2.4.0.6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
9 Months Ended
Sep. 30, 2012
Accounting Policies [Abstract]  
Significant Accounting Policies [Text Block]

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. The Company is classified as a development stage enterprise under GAAP and has not generated significant revenues from its principal operations.

 

Development Stage and Capital Resources

 
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. Accordingly, the Company is considered to be in the development stage as defined in GAAP. The Company has not generated significant revenues from its principal operations, and there is no assurance of future revenues. As of September 30, 2012, the Company had an accumulated deficit from inception of $1,135,538.

   

The Company’s activities will necessitate significant uses of working capital beyond 2012. Additionally, the Company’s capital requirements will depend on many factors, including the success of the Company’s continued research and development efforts and the status of competitive products. The Company plans to continue financing its operations with cash received from financing activities, more specifically from one of its major shareholders.

 

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.

 

Use of Estimates

 

In preparing these 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.

 

Fair Value of Financial Instruments

 

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, based on the Company’s principal or, in the absence of a principal, most advantageous market for the specific asset or liability.

 

GAAP provides for a three-level hierarchy of inputs to valuation techniques used to measure fair value, defined as follows:

 

Level 1 — Inputs that are quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2 — Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability, including:

- Quoted prices for similar assets or liabilities in active markets

- Quoted prices for identical or similar assets or liabilities in markets that are not active.

- Inputs other than quoted prices that are observable for the asset or liability

- Inputs that are derived principally from or corroborated by observable market data by correlation or other means.

  

Level 3 — Inputs that are unobservable and reflect the Company’s own assumptions about the assumptions market participants would use in pricing the asset or liability based on the best information available in the circumstances (e.g., internally derived assumptions surrounding the timing and amount of expected cash flows). The Company did not measure any financial instruments presented on the balance sheets at fair value on a recurring basis using significantly unobservable inputs (Level 3) during the nine months ended September 30, 2012 or during the year ended December 31, 2011.

 

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’s financial instruments include cash and accrued liabilities. The estimated fair value of these instruments approximates its carrying amount due to the short maturity of these instruments.

 

Management believes it is not practical to estimate the fair value of advances to stockholder because the transactions cannot be assumed to have been consummated at arm’s length, the terms are not deemed to be market terms, there are no quoted values available for these instruments, and an independent valuation would not be practical due to the lack of data regarding similar instruments, if any, and the associated potential costs.

 

Cash and Cash Equivalents

 

The Company considers all highly-liquid investments with maturities of three months or less when purchased to be cash equivalents. The Company had no cash equivalents as of September

30, 2012 and December 31, 2011.

 

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.

 

Revenue Recognition

 

The Company is in the development stage and has yet to realize revenues from planned operations.  The Company will recognize revenue on arrangements in accordance with Financial

  

Accounting Standards Board Accounting Standards Codification (“ASC”) No. 605, “Revenue Recognition”.  In all cases, revenue is recognized only when the price is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting receivable is reasonably assured. The Company has not recorded any sales transactions since inception.

 

Equipment, net

 

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 machinery and equipment, previously classified as ‘construction in process’ was placed into service on October 1, 2011 and the Company began to depreciate the assets at that time. The equipment is depreciated over 10 years on a straight-line basis. Vehicles are depreciated over 5 years using the straight-line basis. Depreciation expense for the nine months ended September 30, 2012 and 2011 was $10,328 and $0, respectively, and $13,570 for the period from inception to September 30, 2012.

 

Long-Lived Assets

 

In accordance with ASC 350-30 (formerly SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets), 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 assurance 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.

 

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.

  

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.

 

We believe that our income tax filing positions and deductions will be sustained on audit and do not anticipate any adjustments that will result in a material change to our financial position.  Therefore, no reserves for uncertain income tax positions have been recorded pursuant to ASC 740.  In addition, we did not record a cumulative effect adjustment related to the adoption of ASC 740.  Our policy for recording interest and penalties associated with income-based tax audits is to record such items as a component of income taxes.

 

Our tax provision determined using an estimate of our 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 we update our estimate of the annual effective tax rate, and if our estimated tax rate changes, we make a cumulative adjustment. Taxes payable as of September 30, 2012 and December 31, 2011 was $0 and $956, respectively.

 

Share Based Compensation

 

The Company applies ASC 718, Share-Based Compensation to account for its service providers’ share-based payments. Common stock of the Company was given to service providers to retain their assistance in becoming a U.S. public company, assistance with public company regulations, investors’ communications and public relations with broker-dealers, market makers and other professional services.

 

In accordance with ASC 718, the Company determines whether a share payment should be classified and accounted for as a liability award or equity award. All grants of share-based payments to service providers classified as equity awards are recognized in the financial statements based on their grant date fair values which are calculated using historical pricing.

 

The Company has elected to recognize compensation expense based on the criteria that the stock awards vest immediately on the issuance date. ASC 718 requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent period if actual forfeitures differ from initial estimates. There were no forfeitures of share based compensation.

 

Loss per Common Share

 

Basic loss per common share excludes dilutive securities and is computed by dividing net 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 September 30, 2012 and 2011, there were no outstanding dilutive securities.

 

The following table represents the computation of basic and diluted losses per share:

 

    Nine months     Nine months  
    ended September     ended September  
    30, 2012     30, 2011  
Loss available for common shareholder   $ (83,479 )   $ (696,184 )
Basic and fully diluted loss per share   $ (0.00 )   $ (0.00 )
                 
Weighted average common shares outstanding - basic and diluted     193,093,431       191,890,110  

 

Net loss per share is based upon the weighted average shares of common stock outstanding.

 

Recent Accounting Pronouncements

 

Adopted -

 

In May 2011, the Financial Accounting Standards Board ("FASB") issued a new accounting standard on fair value measurements that clarifies the application of existing guidance and disclosure requirements, changes certain fair value measurement principles and requires additional disclosures about fair value measurements. The standard is effective for interim and annual periods beginning after December 15, 2011. Adoption of this accounting standard did not have a material impact on our financial statements and related disclosures.

 

Not Adopted -

 

In December 2011, the FASB issued ASU 2011-11, Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities. The amendments in this update require an entity to disclose information about offsetting and related arrangements to enable users of its financial statements to understand the effect of those arrangements on its financial position. This update will enhance disclosures required by U.S. GAAP by requiring improved information about financial instruments and derivative instruments. The requirements of this update are effective for annual reporting periods beginning on or after January 1, 2013, and interim periods within those annual periods. Entities should provide the disclosures required retrospectively for all comparative periods presented. We are currently evaluating the impact of adopting ASU 2011-11 on the consolidated financial statements.

 

Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the United States Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future financial statements.

XML 40 R27.htm IDEA: XBRL DOCUMENT v2.4.0.6
COMMITMENTS AND CONTINGENCIES (Details Textual) (USD $)
9 Months Ended
Sep. 30, 2012
Operating Lease Periodic Payment $ 300
Former Employee [Member]
 
Litigation Settlement, Expense 5,000
Loss Contingency Damages Sought Value $ 6,500
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9 Months Ended 11 Months Ended
Sep. 30, 2012
Dec. 31, 2011
Dec. 13, 2010
Sep. 30, 2012
Common Stock [Member]
Dec. 31, 2010
Common Stock [Member]
Common Stock, Shares Authorized 300,000,000 300,000,000 300,000,000    
Common stock, par value (in dollars per share) $ 0.0001 $ 0.0001 $ 0.0001    
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares       7,520  
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