Delaware
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20-5572576
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(State or other jurisdiction of
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(I.R.S. Employer Identification No.)
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incorporation or organization)
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Large Accelerated filer
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o |
Accelerated filer
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o |
Non-accelerated filer
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o |
Smaller reporting company
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x |
(do not check if smaller reporting company) |
Class
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Outstanding at June 30, 2013
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|
Common Stock, par value $0.0001
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193,657,844 shares
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2
|
|
3
|
|
4
|
|
5
|
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6
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June 30,
2013
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December 31,
2012
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|||||||
(unaudited)
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||||||||
ASSETS
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|||||||
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||||||||
Current Assets:
|
|
|||||||
Cash
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$ | 15,799 | $ | 665 | ||||
Prepaid expenses
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15,000 | - | ||||||
Advances to stockholder
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11,321 | 11,321 | ||||||
Total current assets
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42,120 | 11,986 | ||||||
Property and equipment, net
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109,365 | 116,117 | ||||||
Total Assets
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$ | 151,485 | $ | 128,103 | ||||
LIABILITIES AND STOCKHOLDERS' DEFICIT
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||||||||
Current Liabilities:
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||||||||
Accounts payable and accrued expenses
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$ | 273,353 | $ | 148,120 | ||||
Note Payable
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42,500 | - | ||||||
Due to related parties
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15,750 | 5,600 | ||||||
Notes payable-related parties
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67,457 | 43,357 | ||||||
Tax payable
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- | 956 | ||||||
Total current liabilities
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399,060 | 198,033 | ||||||
Total Liabilities
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399,060 | 198,033 | ||||||
Stockholders' Deficit:
|
||||||||
Common stock; $0.0001 par value; 300,000,000 shares authorized, 193,657,844 shares issued and outstanding as of June 30, 2013 and 193,216,667 shares issued and outstanding as of December 31, 2012
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19,366 | 19,322 | ||||||
Additional paid-in capital
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1,120,734 | 1,090,778 | ||||||
Accumulated deficit during development stage
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(1,387,675 | ) | (1,180,030 | ) | ||||
Total Stockholders' Deficit
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(247,575 | ) | (69,930 | ) | ||||
Total Liabilities and Stockholders' Deficit
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$ | 151,485 | $ | 128,103 |
For the three
months ended
June 30, 2013
|
For the three
months ended
June 30, 2012
|
For the Six
Months Ended
June 30, 2013
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For the Six
Months Ended
June 30, 2012
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For the period from
February 2, 2010 (inception)
to June 30, 2013
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||||||||||||||||
Revenues
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$ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||
Cost of revenues
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- | - | - | - | - | |||||||||||||||
Gross profit
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- | - | - | - | - | |||||||||||||||
Operating expenses
|
177,101 | 19,134 | 207,645 | 60,869 | 1,383,851 | |||||||||||||||
Loss from operations
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(177,101 | ) | (19,134 | ) | (207,645 | ) | (60,869 | ) | (1,383,851 | ) | ||||||||||
Income tax expense
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- | - | - | - | 3,824 | |||||||||||||||
Net loss
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$ | (177,101 | ) | $ | (19,134 | ) | $ | (207,645 | ) | $ | (60,869 | ) | $ | (1,387,675 | ) | |||||
Basic and diluted loss per common share
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$ | (0.00 | ) | $ | (0.00 | ) | $ | (0.00 | ) | $ | (0.00 | ) | ||||||||
Basic and diluted weighted average common shares outstanding
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193,231,211 | 193,216,667 | 193,223,979 | 193,031,136 |
Common Stock
|
Additional | Common Stock | Total | |||||||||||||||||||||||||
Shares |
Amount
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Common Stock
Subscribed
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Paid-In
Capital
|
Subscriptions
Receivable
|
Accumulated
Deficit
|
Stockholders'
Equity (Deficit)
|
||||||||||||||||||||||
Balance, February 2, 2010 (Inception)
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1,000,000 | $ | 100 | $ | - | $ | 900 | $ | - | $ | - | $ | 1,000 | |||||||||||||||
Common stock subscribed
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- | - | 191,900 | - | (61,915 | ) | - | 129,985 | ||||||||||||||||||||
Stock issued for change in control
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188,000,000 | 18,800 | - | (18,800 | ) | - | - | - | ||||||||||||||||||||
Stock issued for services
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16,000,000 | 1,600 | - | 158,400 | - | - | 160,000 | |||||||||||||||||||||
Net loss for the period
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- | - | - | - | - | (306,270 | ) | (306,270 | ) | |||||||||||||||||||
Balance, December 31, 2010 (1)
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205,000,000 | 20,500 | 191,900 | 140,500 | (61,915 | ) | (306,270 | ) | (15,285 | ) | ||||||||||||||||||
Recapitalization shares contributed from reverse merger agreement
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(84,526,666 | ) | (8,453 | ) | - | 8,453 | - | - | - | |||||||||||||||||||
Issuance pursuant to merger agreement for services - fair valued
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32,500,000 | 3,250 | - | 321,750 | - | - | 325,000 | |||||||||||||||||||||
Issuance per cash considerations in relation to the stockholder subscription
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36,026,666 | 3,603 | (191,900 | ) | 523,997 | (102,200 | ) | - | 233,500 | |||||||||||||||||||
Common stock issued
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2,750,000 | 275 | - | 62,225 | 164,115 | - | 226,615 | |||||||||||||||||||||
Net loss for the year
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- | - | - | - | - | (745,789 | ) | (745,789 | ) | |||||||||||||||||||
Balance, December 31, 2011
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191,750,000 | 19,175 | - | 1,056,925 | - | (1,052,059 | ) | 24,041 | ||||||||||||||||||||
Issuance per cash considerations in relation to the stockholder subscription
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966,667 | 97 | - | 28,903 | - | - | 29,000 | |||||||||||||||||||||
Stock issued for services
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500,000 | 50 | - | 4,950 | - | - | 5,000 | |||||||||||||||||||||
Net loss for the year
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- | - | - | - | - | (127,971 | ) | (127,971 | ) | |||||||||||||||||||
Balance, December 31, 2012
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193,216,667 | 19,322 | - | 1,090,778 | - | (1,180,030 | ) | (69,930 | ) | |||||||||||||||||||
Stock issued for services
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441,177 | 44 | - | 29,956 | - | - | 30,000 | |||||||||||||||||||||
Net loss for the period
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- | - | - | - | - | (207,645 | ) | (207,645 | ) | |||||||||||||||||||
Balance, June 30, 2013 (Unaudited)
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$ | 193,657,844 | $ | 19,366 | $ | - | $ | 1,120,734 | $ | - | $ | (1,387,675 | ) | $ | (247,575 | ) |
For The Six
Months Ended
June 30, 2013
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For The Six
Months Ended
June 30, 2012
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From
February 2, 2010
(Inception) to
June 30, 2013
|
||||||||||
Operating Activities:
|
|
|
||||||||||
Net loss
|
$ | (207,645 | ) | $ | (60,869 | ) | $ | (1,387,675 | ) | |||
Adjustments to reconcile net loss to net cash used in operating activities:
|
||||||||||||
Depreciation and amortization
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6,752 | 6,952 | 23,698 | |||||||||
Stock compensation
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150,000 | 5,000 | 640,000 | |||||||||
Changes in operating assets and liabilities:
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||||||||||||
Prepaid expenses
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(15,000 | ) | 1,817 | (15,000 | ) | |||||||
Accrued expenses
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5,233 | 92 | 153,353 | |||||||||
Due to related party
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10,150 | 1,800 | 15,750 | |||||||||
Tax payable
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(956 | ) | (956 | ) | - | |||||||
Net cash used in operating activities
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(51,466 | ) | (46,164 | ) | (569,874 | ) | ||||||
Investing Activities:
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||||||||||||
Purchase of equipment
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- | - | (133,063 | ) | ||||||||
Net cash used in investing activities
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- | - | (133,063 | ) | ||||||||
Financing Activities:
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||||||||||||
Advances to stockholder
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- | - | (11,321 | ) | ||||||||
Proceeds from Note payable
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42,500 | - | 42,500 | |||||||||
Notes payable - related parties
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24,100 | - | 67,457 | |||||||||
Proceeds from issuance of common stock
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- | 29,000 | 620,100 | |||||||||
Net cash provided by financing activities
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66,600 | 29,000 | 718,736 | |||||||||
Net change in cash
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15,134 | (17,164 | ) | 15,799 | ||||||||
Cash, beginning of period
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665 | 17,664 | - | |||||||||
Cash, end of period
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$ | 15,799 | $ | 500 | $ | 15,799 | ||||||
Supplemental disclosure of cash now information
|
||||||||||||
Cash paid for interest
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$ | - | $ | - | $ | - | ||||||
Cash paid for taxes
|
$ | 956 | $ | 956 | $ | 3,824 |
Six months
ended June 30,
2013
|
Six months
ended June 30,
2012
|
|||||||
Loss available for common shareholder
|
$
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(207,645
|
)
|
$
|
(60,869
|
)
|
||
Basic and fully diluted loss per share
|
$
|
(0.00
|
)
|
$
|
(0.00
|
)
|
||
Weighted average common shares outstanding - basic and diluted
|
193,223,979
|
193,031,136
|
June 30,
2013
|
December 31,
2012
|
|||||||
Motor vehicles
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$ | 1,976 | $ | 1,976 | ||||
Machinery and equipment
|
131,087 | 131,087 | ||||||
133,063 | 133,063 | |||||||
Less accumulated depreciation
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(23,698 | ) | (16,946 | ) | ||||
Total equipment - net
|
$ | 109,365 | $ | 116,117 |
Note
|
Principal
|
Rate
|
Accured interest
|
Maturity
|
|||||||||
Promissory note 1
|
$ | 6,000 | 7 | % | $ | 344 |
9/4/2014
|
||||||
Promissory note 2
|
$ | 2,000 | 7 | % | $ | 105 |
10/1/2014
|
||||||
Promissory note 3
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$ | 2,000 | 7 | % | $ | 80 |
12/3/2014
|
||||||
Total
|
$ | 10,000 | $ | 529 |
Note
|
Principal
|
Rate
|
Accured interest
|
Maturity
|
|||||||||
Promissory note 1
|
$ | 5,000 | 7 | % | $ | 295 |
7/25/2014
|
||||||
Promissory note 2
|
$ | 11,000 | 7 | % | $ | 530 |
10/22/2014
|
||||||
Promissory note 3
|
$ | 15,000 | 7 | % | $ | 627 |
11/24/2014
|
||||||
Promissory note 4
|
$ | 102 | 7 | % | $ | 5 |
10/22/2014
|
||||||
Promissory note 5
|
$ | 879 | 7 | % | $ | 37 |
11/24/2014
|
||||||
Promissory note 6
|
$ | 972 | 7 | % | $ | 57 |
7/25/2014
|
||||||
Total
|
$ | 32,954 | $ | 1,551 |
Note
|
Principal
|
Rate
|
Accured interest
|
Maturity
|
|||||||||
Promissory note 1
|
$ | 234 | 7 | % | $ | 9 |
12/5/2014
|
||||||
Promissory note 2
|
$ | 170 | 7 | % | $ | 7 |
11/18/2014
|
||||||
Promissory note 3
|
$ | 4,100 | 7 | % | $ | 115 |
2/5/2015
|
||||||
Promissory note 4
|
$ | 2,000 | 7 | % | $ | 55 |
2/7/2015
|
||||||
Total
|
$ | 6,504 | $ | 186 |
Note
|
Principal
|
Rate
|
Accured interest
|
Maturity
|
|||||||||
Promissory note 1
|
$ | 8,000 | 7 | % | 161 |
3/18/2015
|
|||||||
Promissory note 2
|
$ | 10,000 | 7 | % | 249 |
2/21/2013
|
|||||||
Total
|
$ | 18,000 | 410 |
Dale P. Euga
|
188,000,000 | |||
Arthur M. Read, II
|
12,000,000 |
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
|
(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
|
POWERDYNE INTERNATIONAL, INC.
|
|
By: /s/ Dale P. Euga
|
|
Dated: August 13, 2013
|
President and Principal executive officer
|
By: /s/ Linda H. Madison
|
|
Dated: August 13, 2013
|
Principal financial officer
|
Date: August 13, 2013
|
/s/ Dale P. Euga
|
Chief Executive Officer
|
Date: August 13, 2013
|
/s/ Linda H. Madison
|
Chief Financial Officer
|
Date: August 13, 2013
|
/s/ Dale P. Euga
|
Chief Executive Officer
|
Date: August 13, 2013
|
/s/ Linda H. Madison
|
Chief Accounting Officer
|
Subsequent Events
|
6 Months Ended |
---|---|
Jun. 30, 2013
|
|
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 11. SUBSEQUENT EVENTS
As noted in “financing agreements” in Note 10, the Company issued the balance of the commitment shares totaling 1,764,707 shares at $0.068 per share for a total value of $120,000. These shares were issued on July 2, 2013. |
Condensed Statements of Operations (Unaudited) (USD $)
|
3 Months Ended | 6 Months Ended | 41 Months Ended | ||
---|---|---|---|---|---|
Jun. 30, 2013
|
Jun. 30, 2012
|
Jun. 30, 2013
|
Jun. 30, 2012
|
Jun. 30, 2013
|
|
Statements of Operations [Abstract] | |||||
Revenues | |||||
Cost of revenues | |||||
Gross profit | |||||
Operating expenses | 177,101 | 19,134 | 207,645 | 60,869 | 1,383,851 |
Loss from operations | (177,101) | (19,134) | (207,645) | (60,869) | (1,383,851) |
Income tax expense | 3,824 | ||||
Net loss | $ (177,101) | $ (19,134) | $ (207,645) | $ (60,869) | $ (1,387,675) |
Basic and diluted loss per common share | $ 0.00 | $ 0.00 | $ 0.00 | $ 0.00 | |
Basic and diluted weighted average common shares outstanding | 193,231,211 | 193,216,667 | 193,223,979 | 193,031,136 |
Summary of Significant Accounting Policies
|
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2013
|
||||||||||||||||||||||||||||||||||||||||||||||
Summary of Significant Accounting Policies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The summary of significant accounting policies presented below is designed to assist in understanding the Company’s condensed 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 condensed 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 June 30, 2013, the Company had an accumulated deficit from inception of $1,387,675.
The Company’s activities will necessitate significant uses of working capital beyond 2013. 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 condensed 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
The Company follows guidance for accounting for fair value measurements of financial assets and financial liabilities and for fair value measurements of nonfinancial items that are recognized or disclosed at fair value in the financial statements on a recurring basis. Additionally, the Company adopted guidance for fair value measurement related to nonfinancial items that are recognized and disclosed at fair value in the financial statements on a nonrecurring basis. The guidance establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows:
Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.
Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
Level 3 inputs are unobservable inputs for the asset or liability.
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 consisted of cash and the notes payable. The estimated fair value of these instruments approximates its carrying amount due to the short maturity of these instruments
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 June 30, 2013 and December 31, 2012.
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.
Property and Equipment
Property and equipment is stated at cost. Capital expenditures for improvements and upgrades to existing equipment are also capitalized. Maintenance and repairs are expensed as incurred. The machinery and equipment, previously classified as ‘construction in progress’ 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 periods ended June 30, 2013 and 2012 was $6,752 and $6,952, respectively, and $23,698 for the period from inception to June 30, 2013.
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
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”) 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 was 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 June 30, 2013 and December 31, 2012 was $0 and $956, respectively.
Share Based Compensation
We periodically issue stock options and warrants to employees and non-employees in non-capital raising transactions for services and for financing costs. We account for stock option and warrant grants issued and vesting to employees based on Financial Accounting Standards Board (FASB) ASC Topic 718, “Compensation – Stock Compensation”, whereas the award is measured at its fair value at the date of grant and is amortized ratably over the vesting period. We account for stock option and warrant grants issued and vesting to non-employees in accordance with ASC Topic 505, “Equity”, whereas the value of the stock compensation is based upon the measurement date as determined at either (a) the date at which a performance commitment is reached, or (b) at the date at which the necessary performance to earn the equity instruments is complete.
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 June 30, 2013 and 2012, there were no outstanding dilutive securities.
The following table represents the computation of basic and diluted losses per share:
Net loss per share is based upon the weighted average shares of common stock outstanding.
Recent Accounting Pronouncements
There are no recently issued accounting pronouncements that the Company has yet to adopt that are expected to have a material effect on its financial position, results of operations, or cash flows. |
Summary of Significant Accounting Policies (Details Textual) (USD $)
|
6 Months Ended | 41 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2013
|
Jun. 30, 2012
|
Jun. 30, 2013
|
Dec. 31, 2012
|
|
Summary of Significant Accounting Policies (Textual) | ||||
Accumulated deficit | $ (1,387,675) | $ (1,387,675) | $ (1,180,030) | |
Depreciation expense | 6,752 | 6,952 | 23,698 | |
Income taxes payable | $ 0 | $ 0 | $ 956 | |
Equipment [Member]
|
||||
Summary of Significant Accounting Policies (Textual) | ||||
Estimated useful life | 5 years | |||
Vehicles [Member]
|
||||
Summary of Significant Accounting Policies (Textual) | ||||
Estimated useful life | 10 years |
Summary of Significant Accounting Policies (Policies)
|
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2013
|
||||||||||||||||||||||||||||||||||||||||||||||
Summary of Significant Accounting Policies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||
Development Stage and Capital Resources | 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 June 30, 2013, the Company had an accumulated deficit from inception of $1,387,675.
The Company’s activities will necessitate significant uses of working capital beyond 2013. 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. |
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Use of Estimates | Use of Estimates
In preparing these condensed 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. |
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Fair Value of Financial Instruments | Fair Value of Financial Instruments
The Company follows guidance for accounting for fair value measurements of financial assets and financial liabilities and for fair value measurements of nonfinancial items that are recognized or disclosed at fair value in the financial statements on a recurring basis. Additionally, the Company adopted guidance for fair value measurement related to nonfinancial items that are recognized and disclosed at fair value in the financial statements on a nonrecurring basis. The guidance establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows:
Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.
Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
Level 3 inputs are unobservable inputs for the asset or liability.
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 consisted of cash and the notes payable. The estimated fair value of these instruments approximates its carrying amount due to the short maturity of these instruments.
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Cash and Cash Equivalents | 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 June 30, 2013 and December 31, 2012. |
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Concentration of Credit Risk | 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.
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Property and Equipment | Property and Equipment
Property and equipment is stated at cost. Capital expenditures for improvements and upgrades to existing equipment are also capitalized. Maintenance and repairs are expensed as incurred. The machinery and equipment, previously classified as ‘construction in progress’ 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 periods ended June 30, 2013 and 2012 was $6,752 and $6,952, respectively, and $23,698 for the period from inception to June 30, 2013. |
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Long-Lived Assets | 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.
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Income Taxes | Income Taxes
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”) 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 was 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 June 30, 2013 and December 31, 2012 was $0 and $956, respectively. |
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Share Based Compensation | Share Based Compensation
We periodically issue stock options and warrants to employees and non-employees in non-capital raising transactions for services and for financing costs. We account for stock option and warrant grants issued and vesting to employees based on Financial Accounting Standards Board (FASB) ASC Topic 718, “Compensation – Stock Compensation”, whereas the award is measured at its fair value at the date of grant and is amortized ratably over the vesting period. We account for stock option and warrant grants issued and vesting to non-employees in accordance with ASC Topic 505, “Equity”, whereas the value of the stock compensation is based upon the measurement date as determined at either (a) the date at which a performance commitment is reached, or (b) at the date at which the necessary performance to earn the equity instruments is complete. |
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Loss per Common Share | 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 June 30, 2013 and 2012, there were no outstanding dilutive securities.
The following table represents the computation of basic and diluted losses per share:
Net loss per share is based upon the weighted average shares of common stock outstanding. |
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Recent Accounting Pronouncements | Recent Accounting Pronouncements
There are no recently issued accounting pronouncements that the Company has yet to adopt that are expected to have a material effect on its financial position, results of operations, or cash flows. |
Common Stock (Details) (USD $)
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0 Months Ended | 6 Months Ended | 11 Months Ended | 12 Months Ended | 0 Months Ended | 3 Months Ended | 0 Months Ended | 1 Months Ended | 11 Months Ended | |||||||
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Jul. 02, 2013
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Jun. 27, 2013
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Jun. 30, 2013
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Dec. 31, 2010
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Dec. 31, 2012
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Dec. 13, 2010
Arthur Read, II, Esq [Member]
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Feb. 07, 2011
Dale Euga [Member]
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Dec. 13, 2010
Dale Euga [Member]
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Jun. 30, 2013
Consultant [Member]
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Mar. 31, 2012
Consultant [Member]
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Dec. 11, 2011
Tiber Creek Corporation And Iraa Fin Service [Member]
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Feb. 08, 2011
Common Stock [Member]
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Feb. 28, 2011
Common Stock [Member]
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Jun. 30, 2010
Common Stock [Member]
Private Placement [Member]
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Dec. 31, 2010
Common Stock Subscribed [Member]
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Feb. 08, 2011
Common Stock Subscribed [Member]
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Common Stock (Textual) | ||||||||||||||||
Number of shares right to receive in exchange of one share | 7,520 | |||||||||||||||
Stock issued for services rendered on behalf of Powerdyne Inc | 1,764,707 | 441,177 | 12,000,000 | 441,177 | 500,000 | 2,000,000 | ||||||||||
Per share value of stock issued for services | $ 0.068 | $ 0.068 | $ 0.01 | $ 0.068 | $ 0.01 | $ 0.01 | $ 0.01 | |||||||||
Stock issued during period value issued for services (in dollars) | $ 120,000 | $ 30,000 | $ 160,000 | $ 5,000 | $ 120,000 | $ 30,000 | $ 5,000 | $ 40,000 | ||||||||
Number of shares issued to the holders of Powerdyne, Inc. | 188,000,000 | 188,000,000 | ||||||||||||||
Common stock, shares issued | 193,657,844 | 193,216,667 | 19,190,000 | |||||||||||||
Stock sold to investor, minimum issue price | $ 0.01 | |||||||||||||||
Stock sold to investor, maximum issue price | $ 0.03 | |||||||||||||||
Common stock subscriptions receivable | 61,915 | |||||||||||||||
Recapitalization shares contributed from reverse merger agreement (in shares) | 84,526,666 | |||||||||||||||
Issuance pursuant to merger agreement for services - fair valued, shares | 32,500,000 | |||||||||||||||
Allocated Share-based Compensation Expense | 325,000 | |||||||||||||||
Capital raised pursuant to stockholder subscription agreements, shares | 966,667 | 19,190,000 | ||||||||||||||
Capital raised pursuant to stockholder subscription agreements | 29,000 | 191,900 | ||||||||||||||
Cash received from common stock subscriptions | $ 619,100 |
Property and Equipment - Net (Details Textual) (USD $)
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6 Months Ended | 41 Months Ended | |
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Jun. 30, 2013
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Jun. 30, 2012
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Jun. 30, 2013
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Property and Equipment - Net (Textual) | |||
Depreciation expense | $ 6,752 | $ 6,952 | $ 23,698 |
Motor vehicles [Member]
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Property and Equipment - Net (Textual) | |||
Estimated useful life | P5Y | ||
Machinery and equipment [Member]
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Property and Equipment - Net (Textual) | |||
Estimated useful life | P10Y |
Commitments and Contingencies (Details) (USD $)
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0 Months Ended | 6 Months Ended | 11 Months Ended | 12 Months Ended | ||
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Jul. 02, 2013
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Jun. 27, 2013
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Oct. 01, 2011
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Jun. 30, 2013
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Dec. 31, 2010
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Dec. 31, 2012
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Commitments and Contingencies (Textual) | ||||||
Stock issued during period value issued for services (in dollars) | $ 120,000 | $ 30,000 | $ 160,000 | $ 5,000 | ||
Per share value of stock issued for services | $ 0.068 | $ 0.068 | ||||
Stock issued for services, shares | 1,764,707 | 441,177 | ||||
Operating lease expiration date | Mar. 31, 2012 | |||||
Lease renewal option, Description | 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. | |||||
Monthly payments for lease agreement | 300 | |||||
Financing Agreements [Member]
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Commitments and Contingencies (Textual) | ||||||
Percentage of offering amount in newly issued stock | 5.00% | |||||
Term of finance agreement | The Company to make available to the venture capital group for purchase up to $3,000,000 in a "Registered Direct Offering" of the Company's common stock at 80% of market price under certain conditions. | |||||
Former Employee [Member]
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Commitments and Contingencies (Textual) | ||||||
Reimbursement of expenses sought by the company under litigation settlement | 5,000 | |||||
Additional expenses sought by the related party | $ 6,500 |
Related Party - Promissory Note (Details 2) (USD $)
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12 Months Ended | 12 Months Ended | ||||||
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Jun. 30, 2013
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Dec. 31, 2012
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Dec. 31, 2012
Aggregate amount of $404 [Member]
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Mar. 31, 2013
Aggregate amount of $404 [Member]
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Dec. 31, 2012
Promissory note 1 [Member]
Aggregate amount of $404 [Member]
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Dec. 31, 2012
Promissory note 2 [Member]
Aggregate amount of $404 [Member]
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Dec. 31, 2012
Promissory note 3 [Member]
Aggregate amount of $404 [Member]
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Dec. 31, 2012
Promissory note 4 [Member]
Aggregate amount of $404 [Member]
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Schedule of demand notes payable | ||||||||
Principal | $ 67,457 | $ 43,357 | $ 6,504 | $ 6,100 | $ 234 | $ 170 | $ 4,100 | $ 2,000 |
Rate | 7.00% | 7.00% | 7.00% | 7.00% | 7.00% | |||
Accrued interest | $ 186 | $ 9 | $ 7 | $ 115 | $ 55 | |||
Maturity | Dec. 05, 2014 | Nov. 18, 2014 | Feb. 05, 2015 | Feb. 07, 2015 |
Property and Equipment - Net (Details) (USD $)
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Jun. 30, 2013
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Dec. 31, 2012
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Property and Equipment | ||
Equipment, gross | $ 133,063 | $ 133,063 |
Less accumulated depreciation | (23,698) | (16,946) |
Total equipment - net | 109,365 | 116,117 |
Motor vehicles [Member]
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Property and Equipment | ||
Equipment, gross | 1,976 | 1,976 |
Machinery and equipment [Member]
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Property and Equipment | ||
Equipment, gross | $ 131,087 | $ 131,087 |
Reverse Merger Accounting
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6 Months Ended |
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Jun. 30, 2013
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Reverse Merger Accounting [Abstract] | |
REVERSE MERGER ACCOUNTING | 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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Property and Equipment - Net
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6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
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Property and Equipment - Net [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROPERTY AND EQUIPMENT - NET | 5. PROPERTY AND EQUIPMENT - NET
Equipment consists of the following as of June 30, 2013 and December 31, 2012:
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 periods ended June 30, 2013 and 2012 was $6,752 and $6,952, respectively and from February 2, 2010 (Inception) to June 30, 2013 was $23,698. |
Basis of Presentation
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6 Months Ended |
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Jun. 30, 2013
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Organization and Basis of Presentation [Abstract] | |
BASIS OF PRESENTATION | 3. BASIS OF PRESENTATION
The accompanying unaudited condensed 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 six months ended June 30, 2013 are not necessarily indicative of the results that may be expected for the year ending December 31, 2013 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, 2012 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. |
Note Payable (Details) (USD $)
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6 Months Ended | |
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Jun. 30, 2013
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Dec. 31, 2012
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Note Payable (Textual) | ||
Note Payable | $ 42,500 | |
Interest rate on note payable | 8.00% | |
Note payable term | 9 months | |
Note payable conversion terms | Any time after 180 days, the lender may convert all or some of the principal and accrued interest into common stock of the Company at a discount rate of 42% to the market. | |
Accrued interest | $ 237 | $ 0 |
Related Party - Promissory Note (Details 3) (USD $)
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3 Months Ended | ||||
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Jun. 30, 2013
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Dec. 31, 2012
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Mar. 31, 2013
Aggregate amount of $18,000 [Member]
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Mar. 31, 2013
Promissory note 1 [Member]
Aggregate amount of $18,000 [Member]
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Mar. 31, 2013
Promissory note 2 [Member]
Aggregate amount of $18,000 [Member]
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Schedule of demand notes payable | |||||
Principal | $ 67,457 | $ 43,357 | $ 18,000 | $ 8,000 | $ 10,000 |
Rate | 7.00% | 7.00% | 7.00% | ||
Accrued interest | $ 410 | $ 161 | $ 249 | ||
Maturity | Mar. 18, 2015 | Feb. 21, 2013 |