Fdctech, Inc 10-K for FY2022

Fdctech, Inc. (FDCT)

10-K 2023-04-17 For: 2022-12-31

Added on April 06, 2026

About this 10-K

Fdctech, Inc filed this 10-K on April 17, 2023, covering the fiscal year ended December 31, 2022 (FY2022).

Headline figures

Fiscal year ended December 31, 2022, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $6.45M; up 1310.2% from $457.66K a year earlier
Net loss: $1.1M; compared with a net loss of $1.74M a year earlier

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delaware		81-1265459
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

200 Spectrum Drive, Suite 300, Irvine, CA		92618
(Address of principal executive offices)		(Zip Code)

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common		FDCT		OTC Markets

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☒
Emerging growth company	☒

PART I.
ITEM 1	BUSINESS	4
ITEM 1 A.	RISK FACTORS	8
ITEM 1 B.	UNRESOLVED STAFF COMMENTS	8
ITEM 2	OPERATING LEASES	8
ITEM 3	LEGAL PROCEEDINGS	8
ITEM 4	MINE SAFETY DISCLOSURES	8
PART II.
ITEM 5.	MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES	9
ITEM 6.	SELECTED FINANCIAL DATA	9
ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	10
ITEM 7A.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	15
ITEM 8.	FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA	15
ITEM 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE	15
ITEM 9A.	CONTROLS AND PROCEDURES	15
ITEM 9B.	OTHER INFORMATION	15
PART III.
ITEM 10.	DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE	16
ITEM 11.	EXECUTIVE COMPENSATION	20
ITEM 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS	21
ITEM 13.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE	22
ITEM 14.	PRINCIPAL ACCOUNTANT FEES AND SERVICES	22
PART IV.
ITEM 15.	FINANCIAL STATEMENT SCHEDULES	23
ITEM 16.	EXHIBITS	23
	SIGNATURES	24

	●	Technology Solutions – The Company licenses its proprietary and sometimes resells third-party technologies to customers. Our proprietary technology includes but is not limited to Condor Risk Management Back Office (“Condor Risk Management”), Condor Pro Multi-Asset Trading Platform (previously known as Condor FX Pro Trading Terminal), Condor Pricing Engine, Crypto Web Trader Platform, and other cryptocurrency-related solutions.

	●	Customized Software Development – The Company develops software for Customers with unique requirements outlined in the Software Development Agreement (“Agreement”).

	●	Consulting Services – The Company’s turnkey business solutions - Start-Your-Own-Brokerage (“SYOB”), Start-Your-Own-Prime Brokerage (“SYOPB”), Start-Your-Own-Crypto Exchange (“SYOC”), FX/OTC liquidity solutions, and lead generations.

	Fiscal year ended December 31, 2022 (Audited)		Fiscal year ended December 31, 2021* (Audited)
Revenue, $		5,827,732		156,013
Cost of sales, $		5,275,741		140,922
Gross Profit (loss), $		551,991		15,091

	Fiscal year ended December 31, 2022 (Audited)		Fiscal year ended December 31, 2021 (Audited)
Wealth Management, $		5,827,732		301,648
Technology & Software Development, $		626,000		156,013
Total, $		6,453,732		457,661

	Fiscal year ended December 31, 2022 (Audited)			Fiscal year ended December 31, 2021 (Audited)
Wealth Management, %		90.30	%		65.91	%
Technology & Software Development, %		9.70	%		34.09	%
Total, %		100.00	%		100.00	%

Name	Age	Position
Mitch Eaglstein	40	President/CEO/Director
Imran Firoz	51	CFO/Secretary/Director
Brian Platt	44	CTO
Jonathan Baumgart	40	Director
Gope S. Kundnani	66	Director

						Stock		Option		Non-Equity Incentive Plan		Nonqualified Deferred		All Other
Name and Principal Position	Year	Salary⁽³⁾ ($)		Bonus ($)		Awards ($)		Awards ($)		Compensation ($)		Compensation ($)		Compensation ($)		Total ($)
Mitch Eaglstein, CEO ⁽¹⁾	2022		144,000		-0-		83,000		-0-		-0-		-0-		-0-		227,000
	2021		144,000		-0-		-0-		-0-		-0-		-0-		-0-		144,000
Imran Firoz, CFO ⁽²⁾	2022		144,000		-0-		83,000		-0-		-0-		-0-		-0-		227,000
	2021		144,000		-0-		-0-		-0-		-0-		-0-		-0-		144,000
Brian Platt, CTO ⁽³⁾	2022		60,000		-0-		-0-		-0-		-0-		-0-		-0-		60,000
	2021		60,000		-0-		-0-		-0-		-0-		-0-		-0-		60,000

Name and Address⁽¹⁾	Title of Class		Number of Shares Beneficially Owned		Percent of Class
Mitch Eaglstein		Common		30,768,105		14.56	%
Imran Firoz		Common		24,310,000		11.50	%
Brian Platt		Common		500,000		0.24	%
Jonathan Baumgart		Common		100,000		0.05	%
Gope S. Kundnani ⁽²⁾		Common		35,000,000		16.57	%
FRH Group Corporation ⁽³⁾		Common		33,600,000		15.90	%
Officers and Directors as a group (4 persons)		Common		35,678,105		16.89	%

Name and Address⁽¹⁾	Title of Class ⁽⁴⁾	Number of Shares Beneficially Owned		Percent of Class
Mitch Eaglstein	Series A Preferred		2,600,000		65.00	%
Imran Firoz	Series A Preferred		400,000		10.00	%
Felix R. Hong ⁽³⁾	Series A Preferred		1,000,000		25.00	%
Officers and Directors as a group (2 persons)	Series A Preferred		3,000,000		75.00	%

	Pages

Report of Independent Registered Public Accounting Firm (PCAOB: ID 5041)	F-2

Consolidated Balance Sheets as of December 31, 2022 and December 31, 2021	F-3

Consolidated Statements of Operations for the fiscal year ending December 31, 2022 and December 31, 2021	F-4

Consolidated Statements of Stockholders’ Deficit for the Years Ended December 31, 2022 and December 31, 2021	F-5

Consolidated Statements of Cash Flows for the fiscal year ending December 31, 2022 and December 31, 2021	F-6

Notes to the Consolidated Financial Statements	F-7

Exhibit		Item

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

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

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

101.INS*		Inline XBRL Instance Document

101.SCH*		Inline XBRL Taxonomy Extension Schema

101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase

101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase

101.LAB*		Inline XBRL Taxonomy Extension Label Linkbase

101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase

104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

	FDCTECH, INC.

Date: April 17, 2023	/s/ Mitchell Eaglstein
	Mitchell Eaglstein, President and CEO (Principal Executive Officer)

	Title of each class
	Common Stock, par value $0.0001

SIGNATURE	TITLE	DATE

/s/ Mitchell Eaglstein	President, Chief Executive Officer (Principal	April 17, 2023
Mitchell Eaglstein	Executive Officer)

/s/ Imran Firoz	Chief Financial Officer (Principal Financial and	April 17, 2023
Imran Firoz	Accounting Officer)

	December 31, 2022			December 31, 2021
Assets
Current assets:
Cash	$	264,829		$	93,546
Accounts receivable, net of allowance for doubtful accounts of $137,371 and $117,487, respectively		65,583			21,153
Other current assets		435,814			494,470
OID promissory note		55,000			-
Total Current assets		821,226			609,169
Capitalized software, net		761,642			650,862
Acquired tangible assets		38,059			46,024
Acquired intangible assets		2,646,615			2,559,739
Other assets – non-current		-			22,500
Total assets	$	4,267,542		$	3,888,293
Liabilities and Stockholders’ Deficit
Current liabilities:
Accounts payable	$	429,500		$	445,215
Line of credit		47,369			39,246
Payroll tax payable		204,828			165,108
Related-party advances		-			81,000
Promissory note		550,000			-
Cares act- paycheck protection program advance		40,139			46,393
Other current liabilities		99,488			31,339
Total Current liabilities		1,371,324			808,301
SBA loan – non-current		131,194			139,699
Cares act- paycheck protection program advance – non-current		-			4,239
Accrued interest – non-current		14,704			9,224
Total liabilities		1,517,222			961,464
Commitments and Contingencies (Note 9)		-			-
Stockholders’ Deficit:
Preferred stock, par value $0.0001, 10,000,000 shares authorized, 4,000,000 issued and outstanding, as of December 31, 2022, and December 31, 2021		400			400
Common stock, par value $0.0001, 250,000,000 shares authorized; 211,275,550 and 141,811,264 shares issued and outstanding, as of December 31, 2022 and December 31, 2021		21,127			14,181
Additional paid-in capital		5,725,530			4,841,545
Accumulated other comprehensive income		(6,169	)		-
Accumulated deficit		(4,335,053	)		(3,230,679	)
Total FDCTech, Inc. stockholders’ equity (deficit)		1,405,835			1,625,448
Noncontrolling interest		1,344,485			1,301,382
Total liabilities and stockholders’ deficit	$	4,267,542		$	3,888,293


	Year Ended
	December 31, 2022			December 31, 2021
Revenues
Technology & software		626,000			301,648
Wealth management		5,827,732			156,013
Total revenue	$	6,453,732		$	457,661
Cost of sales
Technology & software		159,051			274,462
Wealth management		5,275,741			140,922
Total cost of sales		5,434,792			419,884
Gross Profit	$	1,018,940			42,277	)
Operating expenses:
General and administrative		1,679,121			1,127,503
Sales and marketing		382,864			648,833
Total operating expenses		2,061,985			1,776,337
Operating loss		(1,043,045	)		(1,734,059	)
Other income (expense):
Other interest expense		(61,533	)		(11,564	)
Other income (expense)		204			8,929
Total other income (expense)		(61,329	)		(2,635	)
Income (loss) before provision for income taxes		(1,104,374	)		(1,736,695	)
Provision for income taxes		-			-
Net loss	$	(1,104,374	)	$	(1,736,695	)
Less: Net income attributable to noncontrolling interest		(1,360	)		3,202
Net income attributable to FDCTech’s shareholders		(1,103,014	)		(1,739,897	)
Net loss per common share, basic and diluted	$	0.01		$	(0.02	)
Weighted average number of common shares outstanding basic and diluted		158,048,019			86,063,490


	Preferred stock				Common stock						Paid-in			Accumulated			Total Stockholders’
	Shares		Amount		Shares			Amount			Capital			Deficit			Deficit
December 31, 2020		4,000,000	$	400		141,811,264		$	6,887		$	448,653		$	(1,493,984	)	$	(1,038,044	)
December 31, 2021									-
Common shares issued for services valued at $0.27 per share		-		-		2,300,000			230			620,770			-			621,000

Common shares issued for FRH Group note conversion at $0.10 per share		-		-		12,569,080			1,257			1,255,651			-			1,256,908
Common shares issued for services valued at $0.20 per share		-		-		1,750,000			175			349,825			-			350,000

Common shares issued for services valued at $0.25 per share		-		-		1,750,000			175			437,325			-			437,500
Common shares issued for services valued at $0.21 per share		-		-		100,000			10			20,990			-			21,000
Common shares issued for services valued at $0.22 per share		-		-		100,000			10			21,990			-			22,000
Common shares issued for services valued at $0.18 per share		-		-		545,852			55			98,198			-			98,253
Common shares issued for cash valued at $0.10 per share		-		-		2,000,000			200			199,800			-			200,000
Common shares issued for financing cost valued at $0.12 per share		-		-		670,000			67			80,333			-			80,400
Common shares cancelled for services valued at $0.25 per share		-		-		(1,750,000	)		(175	)		(437,325	)		-			(437,500	)
Common shares issued for services valued at $0.11 per share		-		-		1,500,000			150			164,100			-			164,250
Common shares issued for cash valued at $0.10 per share		-		-		250,000			25			25,275			-			25,300
Common shares issued for cash valued at $0.07 per share		-		-		500,000			50			37,025			-			37,075
Common shares issued for acquisition valued at $0.03 per share		-		-		45,000,000			4,500			1,350,000			-			1,354,500
Common shares issued for services valued at $0.03 per share		-		-		5,650,000			565			168,935			-			169,500
Net loss		-		-		-			-			-			(1,736,695	)		(1,736,695	)
Balance, December 31, 2021		4,000,000	$	400		141,811,264		$	14,181		$	4,841,546		$	(3,230,679	)	$	1,625,448
Balance		4,000,000	$	400		141,811,264		$	14,181		$	4,841,546		$	(3,230,679	)	$	1,625,448
Common shares issued for cash valued at $0.0625 per share		-		-		500,000			50			31,200			-			31,250
Common shares issued for services valued at $0.0625 per share		-		-		1,500,000			150			93,600			-			93,750
Common shares issued for cash valued at $0.05 per share		-		-		500,000			50			24,950			-			25,000
Common shares issued for cash valued at $0.0408 per share		-		-		500,000			50			20,335			-			20,385
Common shares issued for financing cost valued at $0.0323 per share		-		-		2,214,286			221			71,300			-			71,521
Common shares issued for cash valued at $0.0356 per share		-		-		500,000			50			17,750			-			17,800
Common shares issued for cash valued at $0.0395 per share		-		-		500,000			50			19,700			-			19,750
Common shares issued for services valued at $0.0379 per share		-		-		250,000			25			9,450			-			9,475
Forex gain (loss) on consolidation		-		-		-			-			-			(6,169	)		(6,169	)
Common shares issued for cash valued at $0.010 per share		-		-		30,000,000			3,000			297,000			-			300,000
Common shares issued for services valued at $0.012 per share		-		-		5,000,000			500			59,500			-			60,000
Common shares issued for services valued at $0.0083 per share		-		-		20,000,000			2,000			164,000			-			166,000
Common shares issued for services valued at $0.0095 per share		-		-		8,000,000			800			75,200			-			76,000
Net loss		-		-		-			-			-			(1,104,374	)		(1,104,374	)
Balance, December 31, 2022		4,000,000	$	400		211,275,550		$	21,127		$	5,725,530		$	(4,335,053	)	$	1,405,835
Balance		4,000,000	$	400		211,275,550		$	21,127		$	5,725,530		$	(4,335,053	)	$	1,405,835

	●	Identify the contract or contracts and subsequent amendments with the customer.
	●	Identify all the performance obligations in the contract and subsequent amendments.
	●	Determine the transaction price for completing performance obligations.
	●	Allocate the transaction price to the performance obligations in the contract.
	●	Recognize the revenue when, or as, the Company satisfies a performance obligation.

Performance Obligation	Types of Deliverables	When Performance Obligation is Typically Satisfied
Consulting Services	Consulting related to Start-Your-Own-Brokerage (“SYOB”), Start-Your-Own-Prime Brokerage (“SYOPB”), Start-Your-Own-Crypto Exchange (“SYOC”), FX/OTC liquidity solutions and lead generations.	The Company recognizes the consulting revenues when the customer receives services over the contract length. If the customer pays the Company in advance for these services, the Company records such payment as deferred revenue until the Company completes the services.

Technology Services	Licensing of Condor Risk Management Back Office (“Condor Risk Management”), Condor FX Pro Trading Terminal, Condor Pricing Engine, Crypto Trading Platform (“Crypto Web Trader Platform”), and other cryptocurrency-related solutions.	The Company recognizes ratably over the contractual period that the services are delivered, beginning on the date such service is made available to the customer. Licensing agreements are typically one year in length with an option to cancel by giving notice; customers have the right to terminate their agreements if the Company materially breaches its obligations under the agreement. Licensing agreements do not provide customers the right to take possession of the software. The Company charges the customers a set-up fee for installing the platform, and implementation activities are insignificant and not subject to a separate fee.

Software Development	Design and build development software projects for customers, where the Company develops the project to meet the design criteria and performance requirements as specified in the contract.	The Company recognizes the software development revenues when the Customer obtains control of the deliverables as stated in the Statement-of-Work contract.

	●	Assets and liabilities at the rate of exchange in effect at the balance sheet date
	●	Equities at the historical rate
	●	Revenue and expense items at the average rate of exchange prevailing during the period

Level I		Level 2		Level 3
Level 1 is a quoted price for an identical item in an active market on the measurement date. Level 1 is the most reliable evidence of fair value and is used whenever this information is available.		Level 2 is directly or indirectly observable inputs other than quoted prices. An example of a Level 2 input is a valuation multiple for a business unit based on comparable companies’ sales, EBITDA, or net income.		Level 3 is an unobservable input. It may include the company’s data, adjusted for other reasonably available information. Examples of a Level 3 input are an internally-generated financial forecast.


Fiscal year ended December 31, 2023	$	22,503
Fiscal year ended December 31, 2024	$	0
Fiscal year ended December 31, 2025	$	0
Fiscal year ended December 31, 2026	$	0
Fiscal year ended December 31, 2027	$	0

Date of Note:	2/22/2016			5/16/2016			11/17/2016			4/24/2017
Original Amount of Note:	$	100,000		$	400,000		$	250,000		$	250,000
Outstanding Principal Balance:	$	-		$	-		$	-		$	-
Conversion Date ⁽¹⁾:		02/22/2021			02/22/2021			02/22/2021			02/22/2021
Interest Rate:		6	%		6	%		6	%		6	%
Date to which interest has been paid:		Accrued			Accrued			Accrued			Accrued
Conversion Rate on February 22, 2021:	$	0.10		$	0.10		$	0.10		$	0.10
Floor Conversion Price:	$	0.05		$	0.05		$	0.05		$	0.05
Number Shares Converted for Original Note:		1,000,000			4,000,000			2,500,000			2,500,000
Number Shares Converted for Interest:		29,117			111,000			61,792			55,000

1.	To amend our certificate of incorporation, as amended (the “Certificate”), to increase the number of authorized shares of common stock from 250,000,000 to 500,000,000 (the “Authorized Share Increase” and together with the 2022 Equity Plan, the “Corporate Action”), and

2.	To approve the Company’s 2022 Equity Plan (the “2022 Equity Plan”)

Original Number of Warrants Issued		Exercise Price per Common Share				Exercisable at December 31, 2017				Became Exercisable				Exercised				Terminated / Canceled / Expired				Exercisable at December 31, 2019				Expiration Date
653,332		$	0.30				653,332				-				-				653,332				-			April 2019

Income Tax	Deferred Tax Assets/Liability
	December 31, 2022					December 31, 2021
		Book value		Tax value			Book value		Tax value
Income (Loss) per Books
M-1 Differences:		(1,104,374	)	(231,919	)		(1,736,695	)	(364,706	)
Stock/options issued for services		476,746		100,117			1,526,404		320,545
Depreciation and amortization		159,051		33,401			-		-
Tax income (loss)		(468,577	)	(98,401	)		(210,291	)	(44,161	)

Prior Year NOL (exclude effect of state tax)		(888,734	)	(186,634	)		(678,443	)	(142,473	)
Cumulative NOL		(1,357,311	)	(285,035	)		(888,734	)	(186,634	)

	December 31, 2022			December 31, 2021
Net operating loss carry forwards		285,035			186,634
Stock/options issued for services		100,117			320,545
Depreciation and amortization		33,401			-
Goodwill impairment		-			-
Tax rate change		-			-
Valuation allowance		(418,553	)		(507,179	)
Total		-			-

Tax at statutory rate (21%)		(231,919	)		(364,706	)
State tax benefit, net of federal tax effect		-			-
Change in valuation allowance		231,919			364,706
Total		-			-

1.	I have reviewed this report on Form 10-K of FDCTech, Inc. (“Registrant”);

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 consolidated 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 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)) 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.	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 evaluation; and

	c.	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.

	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.

	/s/ Mitchell Eaglstein
	Mitchell Eaglstein
	President (Principal Executive Officer)

	April 17, 2023

	/s/ Imran Firoz
	Imran Firoz, Chief Financial Officer
	(Principal Accounting Officer)

	April 17, 2023

(1)	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.