Company Quick10K Filing
ABCO Energy
Price0.00 EPS-0
Shares63 P/E-0
MCap0 P/FCF-0
Net Debt-0 EBIT-1
TEV-0 TEV/EBIT0
TTM 2019-09-30, in MM, except price, ratios
10-Q 2020-03-31 Filed 2020-09-01
10-K 2019-12-31 Filed 2020-08-07
10-Q 2019-09-30 Filed 2019-11-19
10-Q 2019-06-30 Filed 2019-08-19
S-1 2019-04-26 Public Filing
10-Q 2019-03-31 Filed 2019-05-20
10-K 2018-12-31 Filed 2019-04-16
10-Q 2018-09-30 Filed 2018-11-19
10-Q 2018-06-30 Filed 2018-08-22
10-Q 2018-03-31 Filed 2018-05-21
10-K 2017-12-31 Filed 2018-04-17
10-Q 2017-09-30 Filed 2017-11-20
10-Q 2017-06-30 Filed 2017-08-21
10-Q 2017-03-31 Filed 2017-05-22
10-K 2016-12-31 Filed 2017-04-17
10-Q 2016-09-30 Filed 2016-11-21
10-Q 2016-06-30 Filed 2016-08-22
10-Q 2016-03-31 Filed 2016-05-20
10-K 2015-12-31 Filed 2016-04-11
10-Q 2015-09-30 Filed 2015-11-16
10-Q 2015-06-30 Filed 2015-08-19
10-Q 2015-03-31 Filed 2015-07-10
10-K 2014-12-31 Filed 2015-06-26
10-Q 2014-09-30 Filed 2014-11-19
10-Q 2014-06-30 Filed 2014-08-14
8-K 2020-08-05 Accountant, Exhibits
8-K 2020-08-04 Accountant, Exhibits
8-K 2020-05-14
8-K 2020-05-05
8-K 2020-05-03
8-K 2020-03-30
8-K 2020-01-21
8-K 2019-11-01
8-K 2019-10-07
8-K 2019-05-20
8-K 2019-03-21
8-K 2019-02-22
8-K 2019-01-31
8-K 2019-01-11
8-K 2018-12-21
8-K 2018-11-20
8-K 2018-10-04
8-K 2018-09-12
8-K 2018-09-04
8-K 2018-07-13
8-K 2018-06-14
8-K 2018-05-22

ABCE 10Q Quarterly Report

Part 1 - Financial Information
Item 1. Financial Statements
Note 1 - Overview and Description of The Company
Note 2 - Summary of Significant Accounting Policies
Note 3 - Going Concern
Note 4 - Accounts Receivable
Note 5 - Inventory
Note 6 - Security Deposits and Long Term Commitments
Note 7 - Investment in Long Term Leases
Note 8 - Fixed Assets
Note 9 - Notes Payable From Officers and Related Party Transactions
Note 10 - Short Term Notes Payable
Note 11 - Convertible Debentures - Net of Discounts
Note 12 - Fair Value Measurements
Note 13 - Long Term Debt
Note 14 - Stockholder's Deficit
Note 15 - Equity Awards
Note 16 - Subsequent Events
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II - Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sale of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures.
Item 5. Other Information
Item 6. Exhibits
EX-31.1 ex_202163.htm
EX-31.2 ex_202164.htm
EX-32.1 ex_202165.htm
EX-32.2 ex_202166.htm
EX-99.2 ex_202331.htm

ABCO Energy Earnings 2020-03-31

Balance SheetIncome StatementCash Flow
1.61.00.4-0.1-0.7-1.32014201620182020
Assets, Equity
1.20.80.4-0.1-0.5-0.92014201620182020
Rev, G Profit, Net Income
1.50.90.3-0.3-0.9-1.52014201620182020
Ops, Inv, Fin

10-Q 1 abcoenergy20200331_10q.htm FORM 10-Q abcoenergy20200331_10q.htm

As Filed with the Securities and Exchange Commission on September 1, 2020     



File No:  000-55235

United States

Securities and Exchange Commission

Washington, D.C. 20549

 


 

FORM 10-Q

 


 

(Mark One)

 

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

 

FOR THE QUARTERLY PERIOD ENDING MARCH 31, 2020

 

☐ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from _____to_____ 

 

Commission file number: 000-55235

 

ABCO ENERGY, INC.

 (Name of registrant as specified in its Charter)

 

Nevada

46-5342309

(State of Incorporation)

(IRS Employer Identification No.)

 

2100 North Wilmot #211, Tucson, AZ

85712

(Address of principal executive offices)

(Zip Code)

 

Registrant’s telephone number, including area code:

520-777-0511

 

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

COMMON STOCK

ABCE

OTCPINK

 

Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☐ No ☒

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company.  See the definition of “law accelerated filed,” “accelerated filed,” “Smaller reporting company,” and “emerging growth company” in Rule 12b of the Exchange Act.

 

Large accelerated filer ☐

 

Accelerated filer ☐

 

 

 

Non-accelerated filer ☐

 

Smaller Reporting Company ☒

 

 

 

Emerging growth company  ☒

 

 

 

If an emerging growth company, indicate by check mark (if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

 

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS

 

Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act subsequent to the distribution of securities under a plan confirmed by the court. Yes ☐ No ☐ N/A

 

APPLICABLE ONLY TO CORPORATE ISSUERS:

 

As of August 31, 2020, we had 1,138,384,686 shares of common stock issued and outstanding. 

 

 

 

TABLE OF CONTENTS

 

 

 

PART 1 – FINANCIAL INFORMATION

 

Item 1.     Financial Statements

ABCO ENERGY, INC.

 

CONSOLIDATED FINANCIAL STATEMENTS

 

FOR THE THREE MONTHS ENDED

 

MARCH 31, 2020

 

 

 

 

ABCO ENERGY, INC.

CONSOLIDATED BALANCE SHEETS

 

ASSETS

 

March 31, 2020

Unaudited

   

December 31, 2019

Audited

 

Current Assets

               

Cash

  $ 781     $ 12,620  

Accounts receivable on completed projects

    210,738       30,408  

Costs and estimated earnings on contracts in progress

    104,181       243,693  

Prepaid expenses and discounts on debt

    120,204       89,561  

Total Current Assets

  $ 435,904     $ 376,282  

Fixed Assets

               

Vehicles, office furniture & equipment – net of accumulated depreciation

    352,503       354,938  

Other Assets

               

Investment in long term leases

    4,004       4,136  

Security deposits

    2,700       5,200  

Total Other Assets

    6,704       9,336  

Total Assets

  $ 795,111     $ 740,556  
                 

LIABILITIES AND STOCKHOLDERS’ EQUITY

               

Current liabilities

               

Accounts payable and accrued expenses

  $ 613,783     $ 583,700  

Short term notes payable

    403,595       436,267  

Excess billing on contracts in progress

    69,945       76,052  

Derivative liability on convertible debentures

    389,181       97,974  

Notes payable from officers

    292,820       248,558  

Convertible debentures

    453,974       472,971  

Current portion of long term debt

    16,717       18,860  

Total Current Liabilities

    2,240,015       1,934,382  
                 

         Long term debt, net of current portion

    296,576       300,000  

Total Liabilities

    2,536,591       2,234,382  
                 

Commitments and contingencies

    -       -  
                 

Stockholders’ Deficit:

               

Preferred stock, 100,000,000 shares authorized, $0.001 par value, and 30,000,000 shares

issued and outstanding at March 31, 2020 and 30,000,000 at December 31, 2019.

    30,000       30,000  

Common stock 5,000,000,000 shares authorized, $0.001 value, and 454,840,256 issued and

outstanding at March 31, 2020 and 150,590,887 outstanding at December 31, 2019 respectively.

    454,840       150,591  

Common stock sold but not issued $0.001 par 5,000,000 shares

    14,500       -  

Additional paid-in capital

    4,673,463       4,887,091  

Accumulated deficit

    (6,914,283

)

    (6,561,508

)

Total Stockholders’ Deficit

    (1,741,480

)

    (1,493,826

)

Total Liabilities and Stockholders’ Deficit

  $ 795,111     $ 740,556  

 

See accompanying notes to the unaudited consolidated financial statements.

 

 

ABCO ENERGY, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE THREEE MONTHS ENDED MARCH 31, 2020 AND 2019

(UNAUDITED)

 

   

March 31, 2020

   

March 31, 2019

 
                 

Revenues

  $ 314,792     $ 654,010  
                 

Cost of Sales

    214,170       410,224  
                 

Gross Profit

    100,622       243,786  
                 

Operating Expenses:

               

     Payroll

    38,213       80,317  

     Payroll taxes

    13,171       19,536  

     Consulting expense

    19,510       12,124  

     Corporate expense

    8,940       15,537  

     Insurance

    6,362       17,776  

     Professional fees

    13,529       31,117  

     Rent

    8,915       8,581  

     Other selling and administrative expenses

    51,539       76,073  

       Total operating expense

    160,179       261,061  
                 

Net income (Loss) from operations

    (59,557

)

    (17,275

)

                 

Other expenses

               

Interest on notes payable

    (3,080

)

    (78,914

)

Change in derivative Gain (Loss)

    (290,137

)

    (177,934

)

Gain (Loss) on extinguishment of debt

    -       (244,712

)

Total other expenses

    (293,217

)

    (501,560

)

                 

Net income (Loss) before provision for income taxes

    (352,774

)

    (518,835

)

                 

Provision for income tax

    -       -  
                 

Net income (loss)

  $ (352,774

)

  $ (518,835

)

                 

Net income (loss) Per Share (Basic and Fully Diluted)

  $ (.01

)

  $ (.01

)

                 

Weighted average number of common shares used in the calculation

    305,215,572       47,560,874  

 

See accompanying notes to the consolidated financial statements.

 

 

ABCO ENERGY, INC.

CONSOLIDATED STATEMENT OF SHAREHOLDERS EQUITY

FOR THE THREE MONTHS ENDED MARCH 31, 2020

AND FOR THE YEAR ENDED DECEMBER 31, 2019

(UNAUDITED)

 

   

Common Stock

                                         
   

 

 

Shares

   

Amount

$0.001

Par

   

 

Preferred

Stock

   

Additional

Paid in

Capital

   

 

Shares to

be issued

   

 

Accumulated

Deficit

   

Total

Stockholders’ 

Deficit

 

Balance at December 31, 2018

    32,756,288     $ 32,756     $ 30,000     $ 4,379,793       -     $ (5,180,431

)

  $ (737,882

)

Common shares issued under private placement offering - net of expenses

    4,740,000       4,740               75,516                       80,256  

Common shares issued for conversion of convertible debenture notes - net of expenses

    113,094,599       113,095               30,132                       143,227  

Reclass derivative liability from conversion

                            401,650                       401,650  

Net (loss) for the year

                                            (1,381,077

)

    (1,381,077

)

Balance at December 31, 2019

    150,590,887     $ 150,591     $ 30,000     $ 4,887,091     $ -     $ (6,561,508

)

  $ (1,493,826

)

Common shares issued for conversion of convertible debenture notes - net of expenses

    304,249,369       304,249               (202,628

)

                    101,621  

Shares to be issued for compensation

    5,000,000                               14,500               14,500  

Expenses of capital stock issuances

                            (11,000

)

                    (11,000

)

                                                         

Rounding

                                            (1

)

    (1

)

Net (loss) for the three months ended March 31, 2020

                                            (352,774

)

    (352,774

)

Balance at March 31, 2020

    459,840,256     $ 454,840     $ 30,000     $ 4,673,463     $ 14,500     $ (6,914,283

)

  $ (1,741,480

)

 

 

ABCO ENERGY, INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE THREE MONTHS ENDED MARCH 31, 2020 AND 2019

(UNAUDITED)

 

   

March 31,

   

March 31,

 
   

2020

   

2019

 

Cash Flows from Operating Activities:

               

Net income (loss)

  $ (352,774

)

  $ (518,835

)

Adjustments to reconcile net income (loss) to net cash used in operating activities:

               

Depreciation

    2,435       2,665  

Shares issued to consultants for services

    14,500       -  

Change in amortizable debt discount

    (30,643

)

    26,409  

Change in derivative Gain or (Loss) net effect on income

    290,137       177,934  

Gain or loss on extinguishment of debt

    -       244,712  

Changes in operating assets and liabilities

               

Inventory change

    -       (3,772

)

Changes in Accounts receivable

    (39,706

)

    28,816  

Billings in excess of costs on incomplete projects

    (6,107 )     15,896  

Accounts payable and accrued expenses

    30,083       (99,299

)

Net cash used in operating activities

    (92,075

)

    (125,474

)

                 

Cash flows from investing activities

               

Change in security deposits

    2,500       -  

Equipment purchased

    -       (924

)

Proceeds from investments in long term leases

    132       6,315  

Net cash provided by (used for) investing activities

    2,632       5,391  
                 

Cash Flows from Financing Activities:

               

Proceeds from sale of common stock – net of expenses

    3,500       62,446  

Proceeds from convertible notes and conversions

    (223,125

)

    110,000  

Loans from material lenders

    18,797       -  

Proceeds of related party notes payable

    44,262       -  

Change in derivative liability - effect on balance sheet

    291,207       -  

Proceeds from non-affiliate loans

    -       104,500  

Payments on debt

    (57,037

)

    (191,602

)

Net cash provided by financing activities

    77,604       85,344  
                 

Net increase (decrease) in cash

    (11,839

)

    (34,739

)

Cash, beginning of period

    12,620       67,707  

Cash, end of period

  $ 781     $ 32,968  

 

Supplemental disclosures of cash flow information:

Cash paid for interest

  $ 3,080     $ 78,914  

Shares issued for consulting compensation

    14,500       -  

Income taxes paid or accrued

  $ -     $ -  

 

See accompanying notes to the consolidated financial statements.

 

 

ABCO ENERGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2020 AND 2019

AND THE YEAR ENDED DECEMBER 31, 2019

 

Note 1 – Overview and Description of the Company

 

ABCO Energy, Inc. was organized on July 29, 2004 and operated until July 1, 2011 as Energy Conservation Technologies, Inc. (ENYC). On July 1, 2011 ENYC entered into a share exchange agreement (SEA) with ABCO Energy, Inc. (“ABCO” or “Company”) and acquired all the assets of ABCO. ENYC changed its name to ABCO Energy, Inc. on October 31, 2011. As a result of the SEA, the outstanding shares of ENYC as of June 30, 2011 were restated in a one for twenty three (1 for 23) reverse stock split prior to the exchange to approximately 9% of the post-exchange outstanding common shares of the Company.

 

On January 13, 2017, the Board of Directors of the Company approved a reverse stock split of its common stock, at a ratio of 1-for- 10 (the “Reverse Stock Split”). The Reverse Stock Split became effective with FINRA (the Financial Industry Regulatory Authority) and in the marketplace on January 13, 2017 (the “Effective Date”), whereupon the shares of common stock began trading on a split adjusted basis. As a result of the Reverse Stock Split the number of authorized shares of common stock was reduced to 50,000,000 from 500,000,000 shares. The Company held a Special Meeting of Stockholders in May 2017 which authorized an amendment to the Articles of Incorporation to increase the authorized common share capital to 2,000,000,000 common shares and 100,000,000 preferred shares. Thereafter, on September 27, 2017, by written consent the holders of a majority of the outstanding shares voted to authorize an additional amendment to increase the authorized common shares to 2,000,000,000 shares.

 

On December 23, 2018 the Board of Directors of the Company approved a reverse stock split of its common stock, at a ratio of 1- for-20 (the “Reverse Stock Split”). The Reverse Stock Split became effective with FINRA (the Financial Industry Regulatory Authority) and in the marketplace on December 23, 2018 (the “Effective Date”), whereupon the shares of common stock began trading on a split adjusted basis.

 

On November 8, 2018, by written consent the holders of a majority of the outstanding shares voted to authorize an additional amendment to increase the authorized common shares to 5,000,000,000 shares. All share numbers through-out these financial statements and notes thereto have been adjusted to reflect this reverse split.

 

The Company is in the Photo Voltaic (PV) solar systems industry, the LED and energy efficient commercial lighting business and is an electrical product and services supplier. In 2018 ABCO entered the HVAC business with the acquisition of a small company’s assets and qualifying license. The Company plans to build out a network of operations in major cities in the USA to establish a national base of PV, HVAC, lighting and electrical service operations centers. This combination of services, solar and electric, provides the Company with a solid base in the standard electrical services business and a solid base in the growth markets of solar systems industry.

 

DESCRIPTION OF PRODUCTS

 

ABCO sells and installs Solar Photovoltaic electric systems that allow the customer to produce their own power on their residence or business property. These products are installed by our crews and are purchased from both USA and offshore manufacturers. We have available and utilize many suppliers of US manufactured solar products from such companies as Mia Soleil, Canadian Solar, Boviet, Westinghouse Solar and various Korean, German and Chinese suppliers. In addition, we purchase from several local and regional distributors whose products are readily available and selected for markets and price. ABCO offers solar leasing and long term financing programs from Service Finance Corporation, Green Sky, AEFC and others that are offered to ABCO customers and other marketing and installation organizations.

 

ABCO also sells and installs energy efficient lighting products, solar powered street lights and lighting accessories. ABCO contracts directly with manufacturers to purchase its lighting products which are sold to residential and commercial customers.

 

ABCO has Arizona statewide approval as a registered electrical services and solar products installer and as an air conditioning and refrigeration installer. Our license is ROC 258378 Electrical and ROC 323162 HVAC and we are fully licensed to offer commercial and residential electrical services, HVAC and Solar Electric.

 

ABCO has Three subsidiaries, ABCO Solar, Inc. an Arizona Corporation which provides solar and electric services and products, Alternative Energy Finance Corporation, (AEFC) a Wyoming Company which provides funding for leases of photovoltaic systems, and ABCO Air Conditioning Services, Inc., an Arizona Corporation which sells residential and commercial air conditioning equipment and services in Arizona. In addition, AEFC has two subsidiaries, Alternative Energy Solar Fund, LLC, and Arizona limited liability company that was formed to invest in solar projects and Alternative Energy Finance Corporation, LLC, an Arizona limited liability company formed so AEFC could do business in Arizona.

 

 

ABCO ENERGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2020 AND 2019

AND THE YEAR ENDED DECEMBER 31, 2019

 

Note 2 – Summary of significant accounting policies

 

Critical Accounting Policies and Estimates

 

Our discussion and analysis of our financial condition and results of operations are based on our financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles, or “GAAP.” The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses. Intercompany transactions and balances have been eliminated. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. We have identified the following to be critical accounting policies whose application have a material impact on our reported results of operations, and which involve a higher degree of complexity, as they require us to make judgments and estimates about matters that are inherently uncertain.

 

Cash and Cash Equivalents

There are only cash accounts included in our cash equivalents in these statements. For purposes of the statement of cash flows, the Company considers all short-term securities with a maturity of three months or less to be cash equivalents. There are no short term cash equivalents reported in these financial statements.

 

Fixed Assets

Property and equipment are to be stated at cost less accumulated depreciation. Depreciation is recorded on the straight-line basis according to IRS guidelines over the estimated useful lives of the assets, which range from three to ten years. Maintenance and repairs are charged to operations as incurred.

 

Revenue Recognition

The Company generates revenue from sales of solar products, LED lighting, installation services and leasing fees. During the last two fiscal years, the company had product sales as follows:

 

Sales Product and Services Description

 

Three Months Ended

March 31, 2020

   

Three Months Ended

March 31, 2019

 

Solar PV residential and commercial sales

  $ 286,853       90

%

  $ 653,982       99

%

Energy efficient lighting & other income

    27,600       9

%

    -       -

%

Interest Income

    339       1

%

    28       1

%

Total revenue

  $ 314,792       100

%

  $ 654,010       100

%

 

Revenue Recognition

 

The Company recognizes product revenue, net of sales discounts, returns and allowances. These statements establish that revenue can be recognized when persuasive evidence of an arrangement exists, delivery has occurred, and all significant contractual obligations have been satisfied, the free is fixed or determinable, and collection is considered probable.

 

Our revenue recognition is recorded on the percentage of completion method for sales and installation revenue and on the accrual basis for fees and interest income. We recognize and record income when the customer has a legal obligation to pay. All our revenue streams are acknowledged by written contracts for any of the revenue we record. There are no differences between major classes of customers or customized orders. We record discounts, product returns, rebates and other related accounting issues in the normal business manner and experience very small number of adjustments to our written contractual sales. There are no post-delivery obligations because warranties are maintained by our suppliers. Our lease fees are earned by providing services to contractors for financing of solar systems. Normally we will acquire the promissory note (lease) on a leased system that will provide cash flow for up to 20 years. Interest is recorded on the books when earned on amortized leases.

 

 

ABCO ENERGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2020 AND 2019

AND THE YEAR ENDED DECEMBER 31, 2019

 

Accounts Receivable on completed contracts

The Company recognizes revenue upon delivery of product to customers and does not make bill-and-hold sales. Contracts spanning reporting periods are recorded on the percentage of completion method, based on the ratio of total costs to total estimated costs by project, for recognition of revenue and expenses. Accounts receivable includes fully completed and partially completed projects and partially billed statements for completed work and product delivery. The Company records a reserve for bad debts in the amount of 2% of earned accounts receivable. When the Company determines that an account is uncollectible, the account is written off against the reserve and the balance to expense. If the reserve is deemed to be inadequate after annual reviews, the reserve will be increased to an adequate level.

 

Inventory

The Company records inventory of construction supplies at cost using the first in first out method. After review of the inventory on an annual basis, the Company discounts all obsolete items to net realizable value to account for obsolescence. As of December 31, 2019, all inventory was written off. Inventory at March 31, 2020 was $0.00 and March 31, 2019 was $57,722.

 

Income Taxes

The Company has net operating loss carryforwards as of December 31, 2019 totaling approximately $4,404,020 net of accrued derivative liabilities and stock-based compensation, which are assumed to be non-tax events. A deferred 21% tax benefit of approximately $924,844 has been offset by a valuation allowance of the same amount as its realization is not assured. The full realization of the tax benefit associated with the carry-forward depends predominately upon the Company’s ability to generate taxable income during future periods, which is not assured.

 

The Company files in the US only and is not subject to taxation in any foreign country. There are three open years for which the Internal Revenue Service can examine our tax returns so 2016, 2017 and 2018 are still open years and 2019 will replace 2016 when the tax return is filed.

 

Fair Values of Financial Instruments

ASC 825 requires the Corporation to disclose estimated fair value for its financial instruments. Fair value estimates, methods, and assumptions are set forth as follows for the Corporation’s financial instruments. The carrying amounts of cash, receivables, other current assets, payables, accrued expenses and notes payable are reported at cost but approximate fair value because of the short maturity of those instruments. The Company evaluates derivatives based on level 3 indicators.

 

ASC 825 requires the Corporation to disclose estimated fair value for its financial instruments. Fair value estimates, methods, and assumptions are set forth as follows for the Corporation’s financial instruments. The carrying amounts of cash, receivables, other current assets, payables, accrued expenses and notes payable are reported at cost but approximate fair value because of the short maturity of those instruments.

 

The Company measures assets and liabilities at fair value based on expected exit price as defined by the authoritative guidance on fair value measurements, which represents the amount that would be received on the sale date of an asset or paid to transfer a liability, as the case may be, in an orderly transaction between market participants. As such, fair value may be based on assumptions that market participants would use in pricing an asset or liability. The authoritative guidance on fair value measurements establishes a consistent framework for measuring fair value on either a recurring or nonrecurring basis whereby inputs, used in valuation techniques, are assigned a hierarchical level.

 

The following are the hierarchical levels of inputs to measure fair value:

 

Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2: Inputs reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means.

Level 3: Unobservable inputs reflecting the Company’s assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available.

 

 

ABCO ENERGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2020 AND 2019

AND THE YEAR ENDED DECEMBER 31, 2019

 

The carrying amounts of the Company’s financial assets and liabilities, such as cash, accounts payable and accrued expenses, approximate their fair values because of the current nature of these instruments. Debt approximates fair value based on interest rates available for similar financial arrangements. Derivative liabilities which have been bifurcated from host convertible debt agreements are presented at fair value. See note 13 for complete derivative and convertible debt disclosure.

 

Derivative Financial Instruments

Fair value accounting requires bifurcation of embedded derivative instruments such as convertible features in convertible debts or equity instruments, and measurement of their fair value for accounting purposes. In determining the appropriate fair value, the Company uses the binomial option-pricing model. In assessing the convertible debt instruments, management determines if the convertible debt host instrument is conventional convertible debt and further if there is a beneficial conversion feature requiring measurement. If the instrument is not considered conventional convertible debt, the Company will continue its evaluation process of these instruments as derivative financial instruments.

 

Once determined, derivative liabilities are adjusted to reflect fair value at each reporting period end with any increase or decrease in the fair value being recorded in results of operations as an adjustment to fair value of derivatives. In addition, the fair value of freestanding derivative instruments, such as warrants, are also valued using the binomial option-pricing model.

 

Effects of Recently Issued Accounting Pronouncements

The Company has reviewed all recently issued accounting pronouncements and have determined the following have an affect on our financial statements:

 

Stock-Based Compensation

The Company accounts for employee and non-employee stock awards under ASC 505 and ASC 718, whereby equity instruments issued to employees for services are recorded based on the fair value of the instrument issued and those issued to non-employees are recorded based on the fair value of the consideration received or the fair value of the equity instrument, whichever is more reliably measurable. For employees, the Company recognizes compensation expense for share-based awards based on the estimated fair value of the award on the date of grant and the probable attainment of a specified performance condition or over a service period.

 

Per Share Computations

Basic net earnings per share are computed using the weighted-average number of common shares outstanding. Diluted earnings per share is computed by dividing net income by the weighted-average number of common shares and the dilutive potential common shares outstanding during the period. All shares were considered anti-dilutive at December 31, 2019. Potentially dilutive share issues are: 1) all unissued common shares sold, 2) all convertible debentures have a possibility of a large number of shares being issued and would result in a larger number of shares issued if the price remains low, 3) the preferred stock of the company held by insiders is convertible into common shares and the preferred stock is voted on a 20 to 1 basis, 4) all options issued. All of the above are potential dilutive items.

 

Note 3 – Going Concern

 

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the recoverability of assets and the satisfaction of liabilities in the normal course of business. Since its inception, the Company has been engaged substantially in financing activities and developing its business plan and marketing. The Company incurred a net loss of $(352,774), the net cash flow used in operations was $(92,075) and its accumulated net losses from inception through the period ended March 31, 2020 is $(6,914,283), which raises substantial doubt about the Company’s ability to continue as a going concern. In addition, the Company’s development activities since inception have been financially sustained through capital contributions from shareholders.

 

The ability of the Company to continue as a going concern is dependent upon its ability to raise additional capital from the sale of common stock or through debt financing and, ultimately, the achievement of significant operating revenues. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts and classification of liabilities that might result from this uncertainty.

 

 

ABCO ENERGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2020 AND 2019

AND THE YEAR ENDED DECEMBER 31, 2019

 

Note 4 – Accounts Receivable

 

Accounts receivable as of March 31, 2020 and 2019, consists of the following:

 

Description

 

Mar. 31 2020

   

Mar 31. 2019

 

Accounts receivable on completed contracts

  $ 210,738     $ 65,073  

Costs and estimated earnings on contracts in progress

    104,181       195,510  

Total

  $ 314,919     $ 260,583  

 

Costs and Estimated Earnings on projects are recognized on the percentage of completion method for work performed on contracts in progress at March 31, 2020 and March 31, 2019.

 

The Company records contracts for future payments based on contractual agreements entered into at the inception of construction contracts. Amounts are payable from customers based on milestones established in each contract. Larger contracts are billed and recorded in advance and unearned profits are netted against the billed amounts such that accounts receivable reflect current amounts due from customers on completed projects and amounts earned on projects in process are reflected in the balance sheet as costs and estimated earnings in excess of billings on contracts in progress.

 

Excess billings on contracts in process are recorded as liabilities and were $69,945 at March 31, 2020 and $76,052 at December 31, 2019.

 

Note 5 – Inventory

 

Inventory of construction supplies not yet charged to specific projects was $0.00 at March 31, 2020, and $53,950 as of December 31, 2019. The Company values items of inventory at the lower of cost or net realizable value and uses the first in first out method to charge costs to jobs. The Company wrote off all of its inventory during 2019.  We have reserved obsolescence expenses of $0 during 2019 and $0 at March 31, 2020.

 

Note 6 – Security deposits and Long Term Commitments

 

The Company has paid security deposits on the rented spaces it occupies for offices and warehouse which total $2,700 on March 31, 2020 and at December 31, 2019. The Company also made a deposit in the amount of $2,500 on a business purchase that was abandoned and this deposit was refunded during 2020.

 

On May 1, 2014, the Company rented office and warehouse space at 2100 N. Wilmot #211, Tucson, Arizona 85712. This facility consists of 3,600 square feet. The Company now has seven months remaining on a one year lease with monthly rent of $2,741 which was renewed on November 1, 2019 to a term of one year. ABCO has a forward commitment of $19,187 for the next seven months.

 

Note 7 – Investment in long term leases

 

Long term leases recorded on the consolidated financial statements were $4,004 at March 31, 2020 and $4,136 at December 31, 2019 respectively. During the year ended December 31, 2019 one of the leases owned by AEFC was paid in full by the customer and the Company recorded net proceeds of $6,376.

 

 

ABCO ENERGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2020 AND 2019

AND THE YEAR ENDED DECEMBER 31, 2019

 

Note 8 – Fixed Assets

 

The Company has acquired all its office and field work equipment with cash payments and financial institution loans. The total fixed assets consist of land and building, vehicles, office furniture, tools and various equipment items and the totals are as follows:

 

   

March 31,

   

December 31,

 

Asset

 

2019

   

2019

 

Land and Building

  $ 326,400     $ 326,400  

Equipment

    121,556       121,556  

Accumulated depreciation

    (95,453

)

    (93,018

)

Fixed Assets, net of accumulated depreciation

  $ 352,503     $ 354,938  

 

Depreciation expenses for the three months ended March 31, 2020 and 2019 was $2,435 and $2,665 respectively.

 

On December 31, 2019 the Company purchased a building at 2505 N Alvernon consisting of 4,800 SF building and approximately ½ acre of land. The property was financed by a $25,000 loan from Green Capital (GCSG) and a mortgage from the seller for the $300,000 balance. The purchase price was $325,000 plus closing costs of $1,400.

 

Note 9 – Notes Payable from Officers and Related Party Transactions

 

Related party notes payable as of December 31, 2019 and December 31, 2018 consists of the following:

 

 

Description

 

March 31,

2020

   

December 31,

2019

 

Notes payable – Director bearing interest at 12% per annum, unsecured, demand notes.

  $ 60,000,     $ 60,000  

Note payable – Mr. O’Dowd bearing interest at 12% per annum, unsecured, demand note

    61,052       61,052  

Note payable – other bearing interest at 12% per annum, unsecured, demand note.

    171,168       127,506  

Total

  $ 292,820     $ 248,558  

 

The first note in the amount of $60,000 provides for interest at 12% per annum and is unsecured. This note resulted in an interest charge of $37,837 accrued and unpaid at March 31, 2020 and $36,061 at December 31, 2019.

 

The second note has a current balance of $61,052 as of December 31, 2019. The note is an unsecured demand note and bears interest at 12% per annum. This note resulted in an interest charge of $29,175 accrued and unpaid at March 31, 2020 and $27,058 December 31, 2019.

 

The third note is from a related party and has a current balance of $127,506 as of December 31, 2019. The note is an unsecured demand note and bears interest at 12% per annum. This note resulted in an accumulated interest charge of $33,638 accrued and unpaid at March 31, 2020 and $28,556 at December 31, 2019. 

 

The combined total funds due to Officers and related parties totaled $393,470 with principle and interest at March 31, 2020.

 

 

ABCO ENERGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2020 AND 2019

AND THE YEAR ENDED DECEMBER 31, 2019

 

Note 10 – Short Term Notes Payable

 

 

Description

 

March 31,

2020

   

December 31,

2019

 

Bill’d Exchange, LLC, an equipment capital lender, initial financing August 2, 2019, finances equipment for commercial contracted customers in varying amounts

  $ 258,649     $ 239,852  

Merchant loan – Knight Capital Funding, LLC

    38,694       61,747  

Merchant loan – Pearl lending

    51,750       65,664  

Merchant loan – Green Capital

    20,748       35,250  

Private money loan from Perfectly Green Corporation, borrowed January 22, 2018, bearing interest at 3% per annum, unsecured (3) demand note-Original balance $60,000, current balance

    33,754       33,754  

Total

  $ 403,595     $ 436,267  

 

Bill’d Exchange, LLC, a customer equipment capital lender, made their initial financing on August 2, 2019. They finance equipment for commercial contracted customers in varying amounts. These loans bear interest at varying rates and are paid weekly for the amount of interest due on the account at each date. Each loan is secured by the accounts receivable from the customer and by personal guarantee of an affiliated officer of ABCO Solar, Inc.

 

On January 30, 2019 the Company borrowed $153,092 including principal and interest from Knight Capital Funding, LLC, and [“KCF”] bearing interest at 23% per annum, unsecured.  This loan was refinanced on August 10, 2019 and replaced with a new loan of $144,900 from KCF. The balance and accrued interest at December 31, 2019 was $61,747. On February 18, 2020 ABCO defaulted on this loan due to the reduction in business from Covid-19. As of the date of filing this report, no arrangements for resuming payments had been accomplished.

 

On December 6, 2019 the Company borrowed $52,174 from Pearl Delta Funding that contained a repayment in the amount of $72,000 in 160 payments of $450.  This unsecured note bears interest at the imputed rate of approximately 36% per annum. The unpaid balance of principle and interest at December 31, 2019 was $65,664. On February 18, 2020 ABCO defaulted on this loan due to the reduction in business from Covid-19. As of the date of filing this report, no arrangements for resuming payments had been accomplished.

 

On December 31, 2019 ABCO borrowed $25,000 from Green Capital Funding, LLC.  The proceeds from this loan were used to acquire the real estate purchased on the date of the loan.  This unsecured loan bears interest at approximately 36%   and has a repayment obligation in the amount of $35,250 in 76 payments. The unpaid balance of principle and interest at December 31, 2019 was $35,250. On February 18, 2020, ABCO defaulted on this loan due to the reduction in business from Covid-19. As of the date of filing this report, no arrangements for resuming payments had been accomplished however the Company has been paying $1,000 for per month for the three months ended August 31, 2020.

 

On January 22, 2018 the Company borrowed $60,000 from Perfectly Green Corporation, a Texas corporation.  The Company repaid $26,246 leaving a balance of $33,754 and $33,754 at March 31, 2020 and December 31, 2019. The note bears interest at 3% per annum and is payable upon demand after 60 days’ notice which can be requested at any time after May 31, 2018.

 

 

ABCO ENERGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2020 AND 2019

AND THE YEAR ENDED DECEMBER 31, 2019

 

Note 11 – Convertible debentures -net of discounts

 

During the year ended December 31, 2019, the Company funded operations with borrowing on new convertible promissory notes. This table presents the positions on the notes as of March 31, 2020.

 

 

Holder

 

Date

  of Loan  

   

Loan

amount

   

OID and

discounts

  and fees 

   

Interest

 rate

   

Balance

December 31, 2019 

   

Balance March 31, 2020

 

Power Up Lending Group Ltd

    5-13-19     $ 96,300     $ 13,300       8

%

  $ 4,300     $ 0  

Power Up Lending Group Ltd

    8-14-19       68,000       13,000       8

%

    68,000       27,600  

Power Up Lending Group Ltd

    9-11-19       76,000       13,000       8

%

    76,000       76,000  

Crown Bridge Tranche 1

    8-8-19       50,000       5,000       8

%

    50,000       39,452  

Oasis Capital

    9-1-18       150,000       124,671               274,671       310,922  

Totals and balances for 12-31-19

          $ 442,300     $ 164,471             $ 472,971     $ 453,974  

 

The Financial Accounting Standard ASC 815 Accounting for Derivative Instruments and Hedging Activities require that instruments with embedded derivative features be valued at their market values. The Black Scholes model was used to value the derivative liability for the fiscal year ending December 31, 2019 and December 31, 2018. The initial valuation of the derivative liability on the non-converted common shares totaled $207,081 at December 31, 2019. This value includes the fair value of the shares that may be issued according to the contracts of the holders and valued according to our common share price at the time of acquisition. 

 

The Company issued to Power Up Lending Group, Inc. a $96,300 Convertible Promissory Note dated May 13, 2019 which contains an original issue discount of $10,000 (OID) and expenses of $3,300 [“Note”]. The Note is convertible into Company common stock beginning six months after the date of the Note with a stated discount rate of 19% as set forth in the Note. There is no trigger of derivative liability from conversion features until six months after initial borrowing date.  Without the OID, the effective discount would have been 35%. The net proceeds from this Note were used for working capital. $92,000 of this note was converted in 2019 and the balance of $4,300 was converted during the three months ended March 31, 2020.

 

The Company issued to Power Up Lending Group, Inc. [“Power Up”], a $68,000 Convertible Promissory Note dated August 14, 2019 [“Note”] which contains an original issue discount of $10,000.00 (OID) and expenses of $3,000.00 [“Note”]. The Note is convertible into Company common stock beginning six months after the date of the Note with an effective discount rate of approximately 19% upon conversion. There is no trigger of derivative liability from conversion features until six months after initial borrowing date.  Without the OID, the effective discount rate would be 35% as set forth in the Note. The net proceeds from the Note, was used for working capital. $40,400 of this note was converted during the three months ended March 31, 2020.

 

The Company issued to Power Up Lending Group, Inc. [“Power Up”], a $76,000 Convertible Promissory Note dated September 11, 2019 [“Note”] which contains an original issue discount of $10,000.00 (OID) and expenses of $3,000.00 [“Note”]. The Note is convertible into Company common stock beginning six months after the date of the Note with an effective discount rate of approximately 19 % upon conversion. There is no trigger of derivative liability from conversion features until six months after initial borrowing date.  Without the OID, the effective discount rate would be 35% as set forth in the Note. The net proceeds from the Note, was used for working capital.

 

 

ABCO ENERGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2020 AND 2019

AND THE YEAR ENDED DECEMBER 31, 2019

 

On August 8, 2019 the Company issued to Crown Bridge Partners, LLC a Convertible Promissory Note which contains an original issue discount of $15,000 and expenses of $6,000 [“Note”].  ABCO has borrowed the first tranche of $50,000 and paid the expenses of $5,000 of this agreement. The note is divided into 3 tranches with the 1st being executed on August 8, 2019 and the remaining 2 tranches to be issued at Company’s discretion. The note is convertible into Company common stock beginning six months after the date of the effective date of each tranche with a stated discount rate of 36%. There is no trigger of derivative liability from conversion features until six months after initial borrowing date. At the time of the Buyer’s funding of each tranche under the Note, the Company shall issue to Buyer as a commitment fee, a common stock purchase warrant to purchase an amount of shares of its common stock equal to 150% of the face value of each respective tranche divided by $0.05 (for illustrative purposes, the First Tranche face value is equal to $50,000, which resulted in the issuance of a warrant to purchase 1,500,000 shares of the Company’s common stock) pursuant to the terms provided therein (all warrants issuable hereunder, including now and in the future, shall be referred to, in the aggregate, as the “Warrant”) (all warrants issuable hereunder shall be in the same form as the Warrant issued in connection with the First Tranche). The net proceeds from this Note were used for working capital. A conversion feature is associated with this note and prorated from August 8, 2019 to September 30, 2019 in the amount of $4,314. The derivative liability calculation on this note due to its immediate convertibility resulted in a charge to income of $57,075 and a liability in the amount of $71,764. Management does not intend to exercise the last two options to borrow on this note. $17,548 of this note was converted during the three months ended March 31, 2020.

 

 As of February 16, 2019, the Company issued to Power Up, a $55,000.00 of shares of the Series C Preferred Stock agreement (Note) net of an original issue discount of $10,000.00 (OID) and expenses of $3,000.00 [“Note”]. The Note was convertible into Company common stock beginning six months after the Effective Date with an effective discount rate of approximately 20%. The OID on this issue that is paid out of proceeds allows a lower purchase price if the Company purchases this liability. The Company redeemed this note for $106,145 before Power up converted it to common stock, so no dilution took place.

 

As of March 19, 2019, the Company issued to Power Up, a $55,000.00 of shares of the Series C Preferred Stock agreement net of an original issue discount of $10,000.00 (OID) and expenses of $3,000.00 [“Note”]. The Note is convertible into Company common stock beginning six months after the Effective Date with an effective discount rate of approximately 20%. The OID on this issue that is paid out of proceeds allows a lower purchase price if the Company purchases this liability.

 

As of September 1, 2018 the Company entered into an Equity Purchase Agreement with Oasis Capital, LLC, a Puerto Rico limited liability company (“Investor”) pursuant to which Investor agreed to purchase up to $5,000,000 of the Company’s common stock at a price equal to 85% of the market price at the time of purchase (“Put Shares”). The Company agreed to file a new registration statement to register for resale the Put Shares. The Registration Statement must be effective with the SEC before Investor is obligated to purchase any Put Shares. In addition, the Company [i] issued to Investor a one year $150,000 note which is convertible at a fixed price of $.01 per share as a commitment fee for its purchase of Put Shares and [ii] delivered to Investor a Registration Rights Agreement pursuant to which the Company agreed to register all Put Shares acquired under the Equity Purchase Agreement. During 2019, Investor converted $19,405 of principal of the Note and received 22,392,161 shares of common stock. At December 31, 2019, the Note balance was $130,595. Due to change in accounting treatment this note was booked as a prepaid expense with add-on penalties for a total of $144,076 and a liability of $274,671.  The difference is charged to expenses for penalties, derivatives and derivative interest in the amount of $144,076. The entire balance of the prepaid amount has been expensed in the amount of $274,671 in 2019. The liability for this note was not recorded in 2018 because the note had not yet matured. During the three months ended March 31, 2020 Oasis converted $36,053 into shares. The balance on the original note including interest and penalties was $$238,619 at March 31, 2020.

 

As of January 21, 2020 (“Effective Date”), the Company issued to Oasis a $208,000 Promissory Note, net of a prorated original issue discount of $16,000 (“Note”). The Company received $34,000 (“First Tranche”) and the Second in the amount of $25,000 was received in the 1st quarter. The Third Tranches under this Note were due in February and March, 2020, respectively. In addition, the note caries an $8,000 credit for Oasis transactional expenses. There have been no additional loans from the transaction since tranche one and two totaling $59,000. Each Tranche matures nine months from the effective date of each such payment. The Company also agreed to issue to Oasis 5,000,000 shares of common stock as an incentive/commitment fee in connection with the transactions. The Company valued these shares at $14,500 and they are listed on the balance sheet under the cation Common Shares to be issued. The Company was required to use the proceeds received from the Note to retire currently outstanding convertible debt from two lenders which have not yet matured for conversion. The Note becomes convertible into common stock six months after the Effective Date at a 35% discount to market. The cash value of this note at March 31, 2020 was recorded at $72,303 including principal, fees and interest.

 

The combination of the two notes at March 31, 2020 have a recorded balance of $310,922. Oasis and the Company have agreed to negotiate this commitment after the Company is current on its filings.

 

 

ABCO ENERGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2020 AND 2019

AND THE YEAR ENDED DECEMBER 31, 2019

 

Note 12 – Fair Value Measurements

 

The Company complies with the provisions of FASB ASC No. 820, Fair Value Measurements and Disclosures (“ASC 820”), in measuring fair value and in disclosing fair value measurements at the measurement date. ASC 820 defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements required under other accounting pronouncements. FASB ASC No. 820-10-35, Fair Value Measurements and Disclosures- Subsequent Measurement (“ASC 820-10-35”), clarifies that fair value is an exit price, representing the amount 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. ASC 820-10-35-3 also requires that a fair value measurement reflect the assumptions market participants would use in pricing an asset or liability based on the best information available. Assumptions include the risks inherent in a particular valuation technique (such as a pricing model) and/or the risks inherent in the inputs to the model.

  

The Company determined that the conversion feature embedded within the Power Up Series C Preferred shares (Debenture) that reached maturity in 2018 in the amount of $78,000 was a financial derivative. The Generally Accepted Accounting Principles (GAAP) required that the Company’s embedded conversion option be accounted for at fair value. The following schedule shows the change in fair value of the derivative liabilities on March 31, 2020 and December 31, 2019:

 

 

Description

 

March 31,

 2020

   

December 31,

 2019

 

Purchase price of the convertible debenture - net of discount

  $ 442,300     $ 442,300  

Valuation reduction during the period

    (53,119

)

    (344,326

)

Balance of derivative liability net of discount on the notes (See Consolidated Balance sheet liabilities)

  $ 389,181     $ 97,974  
                 

Derivative calculations and presentations on the Statement of Operations

               

Loss on note issuance

  $ -     $ -  

Change in Derivative (Gain) Loss

    (290,317

)

    (48,453

)

Derivative Finance fees

    -       (318,972

)

Gain (loss) on extinguishment of debt

    -       (244,712

)

Derivative expense charged to operations in 2020 and 2019 (See Consolidated Statement of Operations)

  $ (290,317

)

  $ (612,137

)

 

Note 13 – Long term debt

 

 

Holder

 

 Date issued

   

 Interest rate

   

Amount due

March 31,

2020

   

Amount due

December 31,

2019

 

Real Estate Note Allen-Neisen Family trust – Et. Al.

    12-31-19       5

%

  $ 297,065     $ 300,000  

Ascentium Capital

    10-1-18       13

%

    9,838       11,192  

Fredrick Donze

    9-2-18       6

%

    3,482       4,043  

Charles O’Dowd (officer)

    8-9-18       6

%

    2,908       3,625  

Total long term debt

                    313,293       318,860  

Less Current portion

                    16,717       18,860  

 Total long-term debt

                  $ 296,576     $ 300,000  

 

On December 31, 2019 ABCO completed negotiations, financial arrangements and closed on the purchase of a 4,800 square foot office and warehouse building located on one/half acre of paved land on one of Tucson’s busiest streets. This property will be more than adequate to house both the Solar business (Now 3600 SF and the HVAC business (now 2000 SF) including our previously announced acquisition of a Tucson HVAC service and equipment supplier. The land and outbuildings will accommodate all of our equipment. The property acquisition was priced at $325,000 the company paid $25,000 down payment and the seller financed $300,000 over a twenty-year mortgage based on a twenty year amortization and a 5% interest rate with a balloon payment at the end of five (5) years. The monthly payment is $1,980.

 

 

ABCO ENERGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2020 AND 2019

AND THE YEAR ENDED DECEMBER 31, 2019

  

ABCO acquired the assets of Dr. Fred Air Conditioning services on September 2, 2018 for the total price of $22,000. The allocation of the purchase price was to truck and equipment at $15,000 and the balance was allocated to inventory and the license for period of five or more years. The truck and equipment were financed by Ascentium Capital. The payments on the Ascentium capital note are $435 and the payments on the Donze note are $212 each per month

 

The Company purchased an automobile from its then President, Charles O’Dowd, with a promissory note in the amount of $6,575 dated August 9, 2018 and bears interest at 6% per annum for the three year payment plan. Mr. O’Dowd is no longer an officer or employee of the Company. The principle payments during 2019 totaled $2,107. The balance at March 31, 2020 was $2,908.

 

Note 14 – Stockholder’s Deficit

 

Common Stock

 

During the year ended December 31, 2019 the Company sold 4,740,000 shares of restricted common shares in Regulation S offerings to non-US investors. The total proceeds from the offering was $160,305. Commission and expense reimbursements totaled $80,049. The Company recorded net proceeds totaling $80,256.

 

In addition, debenture holders converted debt into 113,094,599 shares which were issued upon conversion of $143,227 of the notes referred to in Note 10 above.

 

During 2018 the Company issued 1,350,000 restricted common shares to management for services with a fair market value of $27,000. Of these awards, Charles O’Dowd received 450,000 shares and Wayne Marx received 50,000 shares. The balance of 850,000 shares was awarded to consultants to the Company. In October 2019, 1,000,000 shares each were issued to Mikael Mildebrandt and Adrian Balinski in connection with their becoming officers and directors of the Company.

 

During the three months ended March 31, 2020 the following shares were converted from debt.

 

Capital Company

 

Shares converted

   

Dollars converted

 

Crown Bridge Partners

    113,900,000     $ 17,548  

Power Up

    109,584,484       48,020  

Oasis Capital

    80,764,885       36,053  

Total

    304,249,369     $ 101,621  

 

Preferred Stock

 

On September 15, 2017 and on September 15, 2018, the Board of Directors authorized on each such date the issuance of 15,000,000 preferred shares for an aggregate of 30,000,000 shares of Class B Convertible Preferred Stock [“Series B”] to both Directors of the Company and to two unaffiliated Consultants or a total of 30,000,000 shares of Series B. The Company assigned a value of $15,000 for the shares for 2017 and 2018. Of the Series B, 12,000,000 shares were issued to Charles O’Dowd and 2,000,000 to Wayne Marx, the Directors. Each Consultant received 8,000,000 shares. See the Company’s Schedule 14C filed with the Commission on September 28, 2018. These shares have no market pricing and management assigned an aggregate value of $30,000 to the stock issued based on the par value of $0.001. The 30,000,000 shares of preferred Stock, each with has 20 votes for each Preferred share held by them of record. The holders of the Preferred are also entitled to an additional 300,000,000 common shares upon conversion of the Preferred Stock. As a result of owning of these shares of Common and Preferred Stock, the Control Shareholders will have voting control the Company.

 

Earnings (loss) per share calculation

 

Basic net loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by dividing net loss by the weighted average number of shares of common stock and potentially outstanding shares of common stock during each period

 

 

ABCO ENERGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2020 AND 2019

AND THE YEAR ENDED DECEMBER 31, 2019

 

The computation of basic and diluted loss per share at December 31, 2019 excludes the common stock equivalents from convertible debt of the following potentially dilutive securities because their inclusion would be anti-dilutive, and the share issue number is not calculable until conversion takes place.

 

Stock subscriptions executed under an earlier offering included a provision whereby ABCO agrees to pay a dividend (defined as interest) of from 6% to 12% of the total amount invested for a period of one year from receipt of the invested funds. This dividend (defined as interest) is allocated between the broker and the investor with amounts paid to the broker treated as a cost of the offering and netted against additional paid in capital and amounts paid to the investor treated as interest expense. Total amounts paid or accrued under this agreement and charged to additional paid-in capital for the years ended December 31, 2019 and 2018, amounted to $0 and $0, respectively. Total amounts paid under this agreement and charged to interest expense for the years ended December 31, 2019 and 2018, amounted to $0 and $0, respectively. The accrued balance due on this obligation to shareholders totals $49,290 at December 31, 2019 and 2018.

 

ABCO has evaluated these agreements under ASC 480-10: Certain Financial Instruments with Characteristics of Both Liabilities and Equity and determined that the capital contributions made under these subscription agreement more closely resemble equity than liabilities as they can only be settled through the issuance of shares and although they have a stated cost associated with them which accrues in the same manner as interest, the cost is only incurred in the first twelve months after placement as is more closely associated with a cost of raising funds than interest expense.

 

As of September 1, 2018 the Company entered into an Equity Purchase Agreement with Oasis Capital, LLC, a Puerto Rico limited liability company (“Investor”) pursuant to which Investor agreed to purchase up to $5,000,000 of the Company’s common stock at a price equal to 85% of the market price at the time of purchase (“Put Shares”). The Company agreed to file a new registration statement to register for resale the Put Shares. The Registration Statement must be effective with the SEC before Investor is obligated to purchase any Put Shares. In addition, the Company [i] issued to Investor a one year $150,000 note which is convertible at a fixed price of $.01 per share as a commitment fee for its purchase of Put Shares and [ii] delivered to Investor a Registration Rights Agreement pursuant to which the Company agreed to register all Put Shares acquired under the Equity Purchase Agreement. During 2019, Investor converted $19,405 of principal of the Note and received 22,392,161 shares of common stock. At December 31, 2019, the Note balance was $130,595. Due to change in accounting treatment this note was booked as a prepaid expense with add-on penalties for a total of $144,076 and a liability of $274,671.  The difference is charged to expenses for penalties, derivatives and derivative interest in the amount of $144,076. The entire balance of the prepaid amount has been expensed in the amount of $274,671 in 2019. The liability for this note was not recorded in 2018 because the note had not yet matured. During the three months ended March 31, 2020 Oasis converted $36,052 into shares. The balance on the original note including interest and penalties was $$238,619 at March 31, 2020.

 

As of January 21, 2020 (“Effective Date”), the Company issued to Oasis a $208,000 Promissory Note, net of a prorated original issue discount of $16,000 (“Note”). The Company received $34,000 (“First Tranche”) and the Second in the amount of $25,000 was received in the 1st quarter. The Third Tranches under this Note were due in February and March, 2020, respectively. In addition, the note caries an $8,000 credit for Oasis transactional expenses. There have been no additional loans from the transaction since tranche one and two totaling $59,000. Each Tranche matures nine months from the effective date of each such payment. The Company also agreed to issue to Oasis 5,000,000 shares of common stock as an incentive/commitment fee in connection with the transactions. The Company valued these shares at $14,500 and they are listed on the balance sheet under the cation Common Shares to be issued. The Company was required to use the proceeds received from the Note to retire currently outstanding convertible debt from two lenders which have not yet matured for conversion. The Note becomes convertible into common stock six months after the Effective Date at a 35% discount to market. The cash value of this note at March 31, 2020 was recorded at $72,303 including principal, fees and interest.

 

The combination of the two notes at March 31, 2020 have a recorded balance of $310,922. Oasis and the Company have agreed to negotiate this commitment after the Company is current on its filings.

 

 

ABCO ENERGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2020 AND 2019

AND THE YEAR ENDED DECEMBER 31, 2019

 

Note 15 – Equity Awards

 

The following table sets forth information on outstanding option and stock awards held by the named executive officers of the Company at March 31, 2020 and December 31, 2019, including the number of shares underlying both exercisable and un-exercisable portions of each stock option as well as the exercise price and the expiration date of each outstanding option. See Note to Notes to Consolidated Financial Statements.

 

Outstanding Equity Awards After Fiscal Year-End (1)

 

 

 

 

Name

 

Number of securities underlying unexercised

options exercisable (1)

     

Number of securities underlying unexercised

options un-exercisable (2)

   

 

 

Option Exercise Price ($)

   

 

 

Option Grant Date

   

Option Expiration Date

Charles O’Dowd

    500,000   (3)     0     $ .001    

01/01/2017

   

01/01/2021

Wayne Marx

    500,000         0     $ .001    

01/01/2017

   

01/01/2021

Mikael Mildebrandt

    1,000,000         8     $ .001    

11/01/2019

   

11/01/2013

Adrian Balinski

    1,000,000         8     $ .001    

11/01/2019

   

11/01/2023

 

 

(1)

No Equity Awards were issued during the year ended December 31, 2019 or during the three months ended March 31, 2020.

 

(2)

All options vest 20% per year beginning on the first anniversary of their grant date.

 

(3)

This option was terminated when Mr. O’Dowd resigned from the Company in October 2019.

 

An aggregate of 2,120,000 stock awards are outstanding under the Equity Incentive Plan as of December 31, 2019.  The 620,000 of the options are issued to a consultant of the Company.

 

Note 16 – Subsequent Events

 

During the five months period ending with the filing of this report, the holders of convertible debt converted an aggregate of $142,950 of a convertible debt instruments into 888,944,240 shares of common stock. The total shares outstanding at the date of filing this report was 1,039,535,127 shares.

 

Subsequent to March 31, 2020, Crown Bridge Partners, LLC converted $17,580 of principal of a convertible Note and received 290,390,132 shares of common stock. At July 27, 2020, the Note balance was $32,420. The Company did not receive any of those proceeds.

 

Subsequent to March 31, 2020, Power UP Lending Group, Inc. converted $88,440- of principal of the Convertible Promissory Notes and received 476,149,206 shares of common stock. At May 29, 2019, the Note balance was $65,500. The Company did not receive any of those proceeds.

 

Subsequent to March 31, 2020, Oasis Capital, LLC (“Oasis”) converted $36,930 of principal of a convertible Note and received 122,404,902 shares of common stock. At May 29, 2020, the Note balance was $93,665 The Company did not receive any of those proceeds for working capital.

 

 

ABCO ENERGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2020 AND 2019

AND THE YEAR ENDED DECEMBER 31, 2019

 

On May 3, 2020, Company entered into a promissory note evidencing an unsecured loan in the amount of $124,099.00 made to the Company under the Paycheck Protection Program (the “Loan”).  The Paycheck Protection Program (or “PPP”) was established under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), and is administered by the U.S. Small Business Administration.  The Loan to the Company is being made through Bank of America, N.A., a national banking association (the “Lender”). The interest rate on the Loan will not exceed 1.00%.  The promissory note evidencing the Loan contains customary events of default relating to, among other things, payment defaults, making materially false and misleading representations to the SBA or Lender, or breaching the terms of the Loan documents.  The occurrence of an event of default may result in the repayment of all amounts outstanding, collection of all amounts owing from the Company, or filing suit and obtaining judgment against the Company. Under the terms of the CARES Act, PPP loan recipients can apply for and be granted forgiveness for all or a portion of loan granted under the PPP.  Such forgiveness will be determined, subject to limitations, based on the use of loan proceeds for payment of payroll costs and any payments of mortgage interest, rent, and utilities.  No assurance is provided that the Company will obtain forgiveness of the Loan in whole or in part.  If the SBA does not confirm forgiveness of the Loan or only partly confirms forgiveness of the Loan, including principal and interest (“Loan Balance”); then, in either such case, the Lender will establish the terms of repayment of the Loan Balance via a separate letter to the Company, containing the amount of each monthly payment, the interest rate, etc.

 

On June 29, 2020 the Company entered into a Loan Agreement and executed a Note  and a Security Agreement for a  loan in the amount of $ 150,000 under the SBA’s Economic Injury Disaster Loan Program . The loan bears interest at 3.75%  per annum and is payable over a thirty year period with monthly payments of $731. No payments are due for the first twelve months of the loan. The loan is secured by a pledge of all tangible and intangible personal property owned by the Company or hereafter acquired. The proceeds have been used by the Company entirely for working capital purposes.

 

On May 29, 2020, Power Up notified the Company that it was in default under the terms of its Convertible Promissory Note dated September 11, 2019 for failure to file this Form 10K on a timely basis and thereby becoming a non-reporting company under the 1934 Exchange Act. Demand for immediate payment of $98,250 plus accrued interest and accrued default interest was also made. The Company is currently considering its options as to how to respond/proceed with respect thereto. 

 

 

 

 

Item 2.     MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

RESULTS OF OPERATIONS – OVERVIEW

 

FOR THE THREE MONTHS ENDED MARCH 31, 2020 AND 2019

AND THE YEAR ENDED DECEMBER 31, 2019

 

Our discussion of operating results for the Three months ended March 31, 2020 and March 31, 2019 are presented below with major category details of revenue and expense including the components of operating expenses.

 

Sales consist of photovoltaic products, electrical services and LED lighting products and installation during both periods for the three months ended March 31, 2020 and for the three months ended March 31, 2019.

 

Sales for the three months ended March 31, 2019 were $314,792 as compared to $ 654,010 for the same three months in 2019.  This is a decrease of 339,218 or 52% of the 2019 sales. The Solar sales revenue in 2020 and 2019 reflected seasonal and changing market conditions in the financing of solar installations and competition from the public utilities in the Arizona markets and the effects of the COVID 19 Pandemic.  When the utilities in Arizona cancelled or substantially reduced net metering, all solar companies have struggled in the residential market. ABCO has begun its focus on commercial sales in 2017 and has been able to grow every period since that decision. ABCO has worked diligently to overcome the utility changes by focusing on commercial applications and the increased interest of business and government in the LED lighting contracts.

 

Cost of sales was $214,170 or 68% of revenues in 2020 and $410,224 or 67% of revenues in 2019.  Gross margins were 32% of revenue in 2020 and 33% of revenue for the three months of 2019.  During 2020 and 2019 we have been offering new products and have found our entry market prices for steel parking structures have added gross margins higher than usual because we use outside contractors for the entire projects.  Our gross profit reflects this decision.  We feel that we have made progress in entering the parking shade markets and that our gross margins will stabilize as growth lowers these margins in the future.

 

Total selling, general and administrative expenses were $160,179 or 51% of revenues in 2020 and $261,061 or 43% of revenues for the same period in 2019.  Net (loss) income from operations for the three-month period ended March 31, 2020 was $(59,557) as compared to the net loss of $17,275 for the same three-month period ended March 31, 2019.  Our operating expenses for this period were lower by $100,882 than the comparative period in 2019. The interest expense during the period ended March 31, 2020 was lower by $75,834 than in the period ended March 31, 2019 due mostly to the lack of new convertible loans during this period where accounting treatment requires the recording of prepaids interest during the first phase of the loan.  Derivative liabilities of convertible debentures decreased by $18,997 during the current period as compared to the prior year. This combination of factors decreased the loss for the period ending March 31, 2020 to $(352,774) as compared to $(518,835) on March 31, 2019, due almost entirely by the change in derivative income and expenses. 

 

As noted in previous paragraphs discussing market conditions, ABCO could not finish its backlog of work and expand into the markets of LED lights and commercial solar markets without maintaining staff, facilities and sales expenses.  When sales revenues fall, and expenses are not reduced in equal amounts or percentages, the result is an increase of the percentage of operating expenses to sales revenue.  Operating expenses for the two periods increased to accommodate our expansion of sales programs, but not in the same ratio as the increase in sales. ABCO chose to maintain a level of expenses that would not cripple the Company’s future.

 

 

STATEMENTS OF CASH FLOWS FOR THE THREE MONTHS ENDED MARCH 31, 2020 AND 2019

AND THE YEAR ENDED DECEMBER 31, 2019

 

During the three months ended March 31, 2020 our net cash used by operating activities was $(92,075) and comparatively the net cash used by operating activities in the three months ended March 31, 2019 was $(125,474).  Net cash used by operating activities in the period ended March 31, 2020 consisted primarily of net losses from operations of $(352,774) for 2020 as compared to a loss of $518,835 for 2019.  Depreciation adjustments were of non-cash expenses were $2,435 and $2,665 for each period respectively. Derivative portion of convertible debt accounted for charges to income for future changes in value of the underlying stock in the amount of $(290,137) for the period ended March 31, 2020.  None of this expense will be realized if this debt is retired before maturity.  The Company experienced an increase in accounts payable of $30,083 and an decrease of $(99,299) for each period respectively.  This is primarily due to the Company’s ability apply cash receipts from investors and operations to pay past and current creditors during each period. Accounts receivable increased by $39,706, net of adjustments for contracts in process, during the period ended March 31, 2020 due to increases in contracts at the end of the period.

 

Net cash used for investing activities for the periods ended March 31, 2020 and 2019 was $2,632 and $5,391 respectively due to receipt of principal on leases paid or terminated and equipment acquisitions.

 

Net cash provided by financing activities for the periods ended March 31, 2020 and 2019 was $77,604 and $85,344 respectively. Net cash provided by financing activities for 2020 and 2019 resulted primarily from the sale of common stock, loans from a financial institution and loans from a Director, Officer and affiliates. Any future conversions will increase the number of shares outstanding and the Stockholders Equity by the amount of the original investment.

 

LIQUIDITY AND CAPITAL RESOURCES

 

Our primary liquidity and capital requirements have been for carrying cost of accounts receivable after completion of contracts.  The industry habitually requires the solar contractor to wait for the utility approval in order to be paid for the contracts. This process can easily exceed 90 days and sometimes requires the Company as the contractor to pay all or most of the cost of the project without assistance from suppliers. Our working capital at March 31, 2020 was $(1,804,111) and it was $(1,558,100) at December 31, 2019.  This increase of $246,011 was primarily due to losses from operations during the period ended March 31, 2020 and adjustments for possible future losses on derivative conversions.  Bank financing has not been available to the Company, but we have been able to increase our credit lines with our suppliers because of good credit.  There are no material covenants on our credit lines, normally due in 30 days, since they are standard in the industry and the balances vary on a daily basis. Most are personally guaranteed by the Officer of the Company.

 

The total borrowed from Directors, Affiliates and officers totaled $292,820 plus accrued interest of $100,650 as of March 31, 2020. There are no existing agreements or arrangement with any Director to provide additional funds to the Company.

 

During the three months period ended March 31, 2020 or the last fiscal year ended December 31, 2019 there were no transactions, or proposed transactions, which have materially affected or will materially affect the Company in which any director, executive officer or beneficial holder of more than 5% of the outstanding common, or any of their respective relatives, spouses, associates or affiliates, has had or will have any direct or material indirect interest. We have no policy regarding entering into transactions with affiliated parties.

 

PLAN OF OPERATIONS

 

Based on our current financial position, we cannot anticipate whether we will have sufficient working capital to sustain operations for the next year if we do not raise additional capital.  We will not, however, be able to reach our goals and projections for multistate expansion without a cash infusion.   We have been able to raise sufficient capital through the sale of our common shares and we have incurred substantial increases in debt from our trade creditors in the normal course of business.   Management will not expand the business until adequate working capital is provided.  Our ability to maintain sufficient liquidity is dependent on our ability to attain profitable operations or to raise additional capital. We have no anticipated timeline for obtaining neither additional financing nor the expansion of our business.  We will continue to keep our expenses as low as possible and keep our operations in line with available working capital as long as possible.  There is no guarantee that the Company will be able to obtain adequate capital from any sources, or at all.

 

 

Item 3.     Quantitative and Qualitative Disclosures about Market Risk

 

Not Applicable to Smaller Reporting Companies.

 

Item 4.     Controls and Procedures

 

(a) Evaluation of Disclosure Controls and Procedures.

 

As of the end of the reporting period, March 31, 2020, we carried out an evaluation, under the supervision and with the participation of our management, including the Company’s Chairman and Chief Executive Officer/Principal Accounting Officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rule 13a-15(e) of the Securities Exchange Act of 1934 (the “Exchange Act”), which disclosure controls and procedures are designed to insure that information required to be disclosed by a company in the reports that it files under the Exchange Act is recorded, processed, summarized and reported within required time periods specified by the SEC’s rules and forms. Based upon that evaluation, the Chairman/CEO and the Chief Financial Officer concluded that our disclosure controls and procedures are not currently effective in timely alerting them to material information relating to the Company required to be included in the Company’s period SEC filings. The Company is attempting to expand such controls and procedures, however, due to a limited number of resources the complete segregation of duties is not currently in place.

 

(b) Changes in Internal Control.

 

Subsequent to the date of such evaluation as described in subparagraph (a) above, there were no changes in our internal controls or other factors that could significantly affect these controls, including any corrective action with regard to significant deficiencies and material weaknesses.

 

(c) Limitations.

 

Our management, including our Principal Executive Officer and Principal Financial Officer, does not expect that our disclosure controls or internal controls over financial reporting will prevent all errors or all instances of fraud. However, we believe that our disclosure controls and procedures are designed to provide reasonable assurance of achieving this objective. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and any design may not succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures. Because of the inherent limitation of a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

 

 

PART II-OTHER INFORMATION

 

Item 1.     Legal Proceedings

 

From time to time, we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. We are currently not aware of any such legal proceedings or claims that we believe will have, individually or in the aggregate, a material adverse effect on our business, consolidated financial condition, or operating results.

 

Item 1A.  Risk Factors

 

Not Applicable.

 

Item 2.     Unregistered Sale of Equity Securities and Use of Proceeds

 

  

Item 3.     Defaults upon Senior Securities

 

None

 

Item 4.     Mine Safety Disclosures.

 

Not Applicable.

 

Item 5.     Other Information

 

Not Applicable.

 

 

Item 6.     Exhibits

 

Exhibit No.

Description of Exhibit

 

 

3(i)

Articles of Incorporation, as amended (1)

3(ii)

By-Laws (1)

10(a)

Share Exchange Agreement dated July 15, 2011 (1)

10(b)

8% of $40,000 Convertible Note dated March 16, 2016 (3)

10(c)

12% $25,000 Convertible Note dated March 23, 2016 (3)

10(d)

10% $55,000 Convertible Note dated April 1, 2016 (4)

10(e)

5% $42,000 Convertible Note dated April 5, 2016 (4)

10(f)

10% $40,000 Convertible Note dated May 3, 2016 (4)

10(g)

8% $30,000 Convertible Note dated May 6, 2016 (4)

21

Subsidiaries of Registrant (1)

31.1

Certification of Chief Executive Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.(2)

31.2

Certifications of Chief Financial Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.(2)

32.1

Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.(2)

32.2

Certifications of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.(2)

99.1 SBA Loan Documents dated  May 3,2020 with respect to a $124,099 loan under the Paycheck Protection Program under the US CARES Act. (5)
99.2

SBA Loan Authorization and Agreement, Note and Security Agreement, each dated June 29, 2020, with respect to the $150,000 loan (2)

 

101 INS

XBRL, Instance Document

101 SCH

XBRL Taxonomy Extension Schema Document

101 CAL

XBRL Taxonomy Calculation Linkbase Document

101 DEF

XBRL Taxonomy Extension Definition Linkbase Document

101 LAB

XBRL Taxonomy Labels Linkbase Document

101 PRE

XBRL Taxonomy Labels Linkbase Document

 

 

(1)

Previously filed with the Company’s Form 10, SEC File No. 000-55235, filed on July 1, 2014, and incorporated herein by this reference as an exhibit to this Form 10-Q.

(2)

Attached.

(3)

Previously filed with the Company’s Form 10-K, File No. 000-55235, filed with the Commission on April 11, 2016 and incorporated herein by this reference.

(4)

Previously filed with the Company’s Form 10-Q, File No. 000-55235, filed with the Commission on May 20, 2016 and incorporated herein by this reference.

(5)

Previously filed with the Company’s Form 8-K, File No. 000-55235, filed with the Commission on May 7, 2020 and incorporated herein by this reference.

 

 

SIGNATURES

 

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

 

In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

 

September 1, 2020

 

 

ABCO ENERGY, INC

 

 

 

 

 

/s/ Adrian Balinski

 

 

Adrian Balinski

 

Title: Acting President &

 

Chief Executive Officer (CEO)

 

 

 

 

 

/s/ Adrian Balinski

 

 

Adrian Balinski

 

Chief Financial Officer (CFO)

 

Principal Accounting Officer (PAO)

 

 

 

 

27