Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2017 | Oct. 31, 2017 | |
Document And Entity Information | ||
Entity Registrant Name | Strategic Environmental & Energy Resources, Inc. | |
Entity Central Index Key | 1,576,197 | |
Document Type | 10-Q | |
Trading Symbol | SENR | |
Document Period End Date | Sep. 30, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity a Well-known Seasoned Issuer | No | |
Entity a Voluntary Filer | No | |
Entity's Reporting Status Current | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 56,338,575 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2,017 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 | ||
Current assets: | ||||
Cash | $ 149,500 | $ 233,200 | [1] | |
Accounts receivable, net of allowance for doubtful accounts of $235,500 and $235,500, respectively | 933,800 | 1,188,100 | [1] | |
Notes receivable, net | 453,800 | |||
Costs and estimated earnings in excess billings on uncompleted contracts | [1] | 13,600 | ||
Assets held for sale | [1] | 1,024,600 | ||
Prepaid expenses and other current assets | 406,300 | 518,500 | [1] | |
Total current assets | 1,943,400 | 2,978,000 | [1] | |
Property and equipment, net | 2,222,800 | 2,805,100 | [1] | |
Intangible assets, net | 644,000 | 738,000 | [1] | |
Notes receivable, net of current portion | 807,700 | |||
Other assets | 60,000 | 16,400 | [1] | |
TOTAL ASSETS | 5,677,900 | 6,537,500 | [1] | |
Current liabilities: | ||||
Accounts payable | 1,425,300 | 1,643,500 | [1] | |
Accrued liabilities | 1,243,800 | 1,381,000 | [1] | |
Billings in excess of costs and estimated earnings on uncompleted contracts | 600,100 | 1,090,800 | [1] | |
Deferred revenue | 134,800 | 188,300 | [1] | |
Payroll taxes payable | 992,000 | 993,300 | [1] | |
Customer deposits | [1] | 330,000 | ||
Liabilities held for sale | [1] | 603,100 | ||
Current portion of notes payable and capital lease obligations | 425,000 | 571,800 | [1] | |
Notes payable - related parties, including accrued interest | 11,800 | 11,800 | [1] | |
Total current liabilities | 4,832,800 | 6,813,600 | [1] | |
Deferred revenue, non-current | 146,800 | 283,600 | [1] | |
Notes payable and capital lease obligations, net of current portion | 1,715,200 | 1,751,500 | [1] | |
Total liabilities | 6,694,800 | 8,848,700 | [1] | |
Commitments and contingencies | ||||
Stockholders' Equity: | ||||
Preferred stock; $.001 par value; 5,000,000 shares authorized; -0- shares issued | ||||
Common stock; $.001 par value; 70,000,000 shares authorized; 56,338,575 and 54,525,079 shares issued and outstanding 2017 and 2016, respectively | 56,100 | 54,500 | [1] | |
Common stock subscribed | 25,000 | 25,000 | ||
Additional paid-in capital | 20,616,500 | 19,077,600 | [1] | |
Stock subscription receivable | (25,000) | (25,000) | [1] | |
Accumulated deficit | (19,404,700) | (19,273,500) | [1] | |
Total stockholders' equity | 1,267,900 | (141,400) | [1] | |
Non-controlling interest | (2,284,800) | (2,169,800) | [1] | |
Total equity | (1,016,900) | (2,311,200) | [1] | |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 5,677,900 | $ 6,537,500 | [1] | |
[1] | These numbers were derived from the audited financial statements for the year ended December 31, 2016. See accompanying notes. |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 235,500 | $ 235,500 |
Preferred stock, par value (in dollars per shares) | $ 0.001 | $ 0.001 |
Preferred stock, authorized | 5,000,000 | 5,000,000 |
Preferred stock, issued | 0 | 0 |
Common stock, par value (in dollars per shares) | $ 0.001 | $ 0.001 |
Common stock, authorized | 70,000,000 | 70,000,000 |
Common stock, issued | 56,338,575 | 54,525,079 |
Common stock, outstanding | 56,338,575 | 54,525,079 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |||
Revenue: | ||||||
Products | $ 717,300 | $ 1,749,100 | $ 4,268,800 | $ 3,454,500 | ||
Services | 413,000 | 167,600 | 1,803,000 | 2,423,800 | ||
Licensing | 453,100 | 41,900 | 596,900 | 170,000 | ||
Total revenue | [1] | 1,583,400 | 1,958,600 | 6,668,700 | 6,048,300 | |
Operating expenses: | ||||||
Products costs | 506,700 | 1,322,800 | 2,912,800 | 2,388,300 | ||
Services costs | 561,100 | 478,500 | 2,069,600 | 2,109,800 | ||
Solid waste costs | 345,500 | 79,800 | 455,800 | 245,400 | ||
General and administrative expenses | 783,800 | 413,100 | 2,077,500 | 1,381,200 | ||
Salaries and related expenses | 548,300 | 459,300 | 1,587,500 | 1,709,600 | ||
Total operating expenses | 2,745,400 | 2,753,500 | 9,103,200 | 7,834,300 | ||
Income (Loss) from operations | (1,162,000) | (794,900) | (2,434,500) | (1,786,000) | ||
Other income (expense): | ||||||
Interest expense | [1] | (256,000) | (55,700) | (1,212,500) | (255,200) | |
Loss contingency | (48,000) | (48,000) | ||||
Other | 40,000 | (32,400) | 34,100 | (3,900) | ||
Total non-operating expense, net | (216,000) | (136,100) | (1,178,400) | (307,100) | ||
Net loss from continuing operations | (1,378,000) | (931,000) | (3,612,900) | (2,093,100) | ||
Net income from discontinued operations | 215,400 | 57,200 | 693,700 | 397,600 | ||
Gain recognized on sale of rail operations | 2,672,900 | 2,672,900 | ||||
Discontinued operations, net of tax | 2,888,300 | 57,200 | 3,366,600 | 397,600 | ||
Net income (loss) before earnings from equity method joint ventures | 1,510,300 | (873,800) | (246,300) | (1,695,500) | ||
Income from equity method joint ventures | 15,700 | |||||
Net income (loss) | 1,510,300 | (873,800) | (246,300) | (1,679,800) | ||
Less: Net loss attributable to non-controlling interest | (23,900) | (83,600) | (115,100) | (223,100) | ||
Net income (loss) attributable to SEER common stockholders | $ 1,534,200 | $ (790,200) | $ (131,200) | $ (1,456,700) | ||
Net loss per share from continuing operations (in dollars per share) | $ (0.02) | $ (0.02) | $ (0.06) | $ (0.04) | ||
Net loss per share from discontinued operations (in dollars per share) | 0.05 | 0 | 0.06 | 0.01 | ||
Net income (loss) per share, basic and diluted (in dollars per share) | $ 0.03 | $ (0.02) | [2] | $ (0.03) | ||
Weighted average shares outstanding - basic and diluted (in shares) | 55,457,053 | 54,525,079 | 54,902,947 | 54,263,765 | ||
[1] | Excludes discontinued operations | |||||
[2] | Less than $0.01. |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited) - USD ($) | 9 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | |||
Cash flows from operating activities: | ||||
Net loss | $ (246,300) | $ (1,695,500) | ||
Income from discontinued operations | 3,366,600 | 397,600 | ||
Net loss from continuing operations | (3,612,900) | (2,093,100) | ||
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||
Provision for doubtful accounts receivable | 3,900 | |||
Depreciation and amortization | [1],[2] | 595,300 | 570,900 | |
Stock-based compensation expense | 94,000 | 84,000 | ||
Non-cash expense for interest, common stock issued for debt penalty | 1,009,000 | |||
Non-cash expense for interest, warrants - accretion of debt discount | 6,200 | 101,700 | ||
Non-cash expense for extension of warrants | 83,600 | |||
Warrants isued for services | 31,300 | |||
Stock issued in satisfaction of settlement | 174,000 | |||
Gain on settlement | (102,300) | |||
Gain on disposition of assets | (25,600) | |||
Changes in operating assets and liabilities: | ||||
Accounts receivable | 254,300 | 148,200 | ||
Costs in Excess of billings on uncompleted contracts | 13,600 | 204,000 | ||
Prepaid expenses and other assets | 160,500 | (95,900) | ||
Accounts payable and accrued liabilities | (278,700) | (361,400) | ||
Billings in excess of revenue on uncompleted contracts | (490,700) | 112,500 | ||
Deferred revenue | (127,900) | 47,800 | ||
Payroll taxes payable | (1,300) | 17,100 | ||
Net cash provided by operating activities | (2,192,000) | (1,285,900) | ||
Cash flows from investing activities: | ||||
Insurance proceeds from property damage | 59,000 | |||
Purchase of property and equipment | (240,800) | (177,300) | ||
Purchases of intangibles | (15,500) | (37,500) | ||
Proceeds from sale of discontinued operations, net of costs | 2,285,500 | |||
Distributions for notes receivable | (300,000) | |||
Net cash used in investing activities | 1,729,200 | (155,800) | ||
Cash flows from financing activities: | ||||
Payments of notes and capital lease obligations | (980,900) | (559,600) | ||
Payments of related party notes payable and accrued interest | (20,000) | |||
Proceeds from convertible debt | 250,000 | |||
Proceeds from short-term notes | 750,000 | 400,000 | ||
Proceeds from exercise of warrants | 25,000 | |||
Proceeds from warrant extensions | 148,600 | 29,900 | ||
Proceeds from the sale of common stock and warrants, net of expenses | 400,000 | |||
Net cash provided by (used in) financing activities | (82,300) | 525,300 | ||
Net cash flows from discontinued operations | 461,400 | 801,600 | ||
Net decrease in cash | (83,700) | (114,800) | ||
Cash at the beginning of period | 233,200 | [3] | 257,100 | |
Cash at the end of period | 149,500 | 142,300 | ||
Supplemental disclosures of cash flow information: | ||||
Cash paid for interest | 197,600 | 207,600 | ||
Discount on convertible debt | 4,900 | |||
Financing of prepaid insurance premiums | $ 438,300 | 278,600 | ||
Issuance of common stock for other assets | $ 720,000 | |||
[1] | Excludes discontinued operations | |||
[2] | Includes depreciation of property, equipment and leasehold improvement and amortization of intangibles | |||
[3] | These numbers were derived from the audited financial statements for the year ended December 31, 2016. See accompanying notes. |
ORGANIZATION AND FINANCIAL COND
ORGANIZATION AND FINANCIAL CONDITION | 9 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND FINANCIAL CONDITION | NOTE 1 - ORGANIZATION AND FINANCIAL CONDITION Organization and Going Concern Strategic Environmental & Energy Resources, Inc. (“SEER,” “we,” or the “Company”), a Nevada corporation, is a provider of next-generation clean-technologies, waste management innovations and related services. SEER has three wholly-owned subsidiaries in continuing operations, and two majority-owned subsidiaries; all of which together provide technology solutions and services to companies primarily in the oil and gas, refining, landfill, food, beverage & agriculture and renewable fuel industries. The three wholly-owned subsidiaries include: 1) REGS, LLC (d/b/a Resource Environmental Group Services (“REGS”)) provides industrial and proprietary cleaning services to refineries, oil fields and other private and governmental entities and the assets and liabilities of three locations of this subsidiary which provided fixed rail car cleaning were sold along with Tactical assets and liabilities in July 2017; 2) MV, LLC (d/b/a MV Technologies) (“MV”), designs and builds biogas conditioning solutions for the production of renewable natural gas and odor control systems primarily for landfill operations, waste-water treatment facilities, oil and gas fields, refineries, municipalities and food, beverage & agriculture operations throughout the U.S.; 3) SEER Environmental Materials, LLC,(“SEM”), a materials technology company focused on development of cost-effective chemical absorbents. A fourth wholly-owned subsidiary, Tactical Cleaning Company, LLC (“Tactical”), provided proprietary cleaning services related to railcar tankers, tank trucks and frac tanks to customers from its sites in Colorado and Kansas and substantially all of the assets and liabilities of this subsidiary were sold in July 2017. The two majority-owned subsidiaries are; 1) Paragon Waste Solutions, LLC (“PWS”) and 2) ReaCH4Biogas (“Reach”). PWS is currently owned 54% by SEER (see Note 7) and Reach is owned 85% by SEER. PWS is developing specific opportunities to deploy and commercialize patented technologies for a non-thermal plasma-assisted oxidation process that makes possible the clean and efficient destruction of solid hazardous chemical and biological waste ( i.e etc i.e Reach (the trade name for BeneFuels, LLC), is currently owned 85% by SEER and focuses specifically on developing renewable biomethane projects that convert raw biogas to pipeline quality gas and/or compressed natural gas (“CNG”) for fleet vehicle fuel. Reach had minimal operations for the quarter ended September 30, 2017 and 2016. Principals of Consolidation The accompanying consolidated financial statements include the accounts of SEER, its wholly-owned subsidiaries, REGS, MV and SEM and its majority-owned subsidiaries PWS and Reach, since their respective acquisition or formation dates. All material intercompany accounts, transactions, and profits have been eliminated in consolidation. The Company has non-controlling interest in joint ventures, which are reported on the equity method. Going Concern As shown in the accompanying consolidated financial statements, the Company has experienced recurring losses, and has accumulated a deficit of approximately $19.4 million as of September 30, 2017, and $19.3 million as of December 31, 2016. For the nine months ended September 30, 2017 we had losses from operations of approximately $3.6 million and for the year ended December 31, 2016, we incurred losses from operations of approximately $4.7 million. The Company had a working capital deficit of approximately $2.9 million at September 30, 2017, a decrease of approximately $1.1 million in the working capital deficit of $4 million at December 31, 2016. REGS, a wholly owned subsidiary, was notified that effective April 1, 2016 it would no longer be providing routine maintenance services to its largest customer but would still be eligible to provide other industrial cleaning services. The loss of revenue from this customer was approximately $2.5 for the year ended December 31, 2016. The Company has limited common shares available for issue which may limit the ability to raise capital or settle debt through issuance of shares. These factors raise substantial doubt about the ability of the Company to continue to operate as a going concern for a period of at least one year after the date of the issuance of our audited financial statements for the period ended December 31, 2016. Realization of a major portion of our assets as of September 30, 2017 and December 31, 2016, is dependent upon our continued operations. The Company is dependent on generating additional revenue or obtaining adequate capital to fund operating losses until it becomes profitable. The Company opened an additional rail car cleaning facility in the Midwest (Illinois) and East Coast (Maryland) during 2016 and in the Jersey Coast (Pennsylvania) in 2017 to offset some of the lost revenue previously derived from the refinery sector. Revenue from the new rail car cleaning facilities began in mid-2016 (Illinois), fourth quarter of 2016 (Maryland) and second quarter 2017 (Pennsylvania) and all locations experienced monthly revenue growth during the months leading up to their sale on July 31, 2017. These three rail car cleaning facilities are included with the Tactical rail car cleaning facilities in assets and liabilities held for sale at December 31, 2016, and as discontinued operations for the three and nine months ended September 30, 2017 and 2016. In addition, we have undertaken a number of specific steps to improve operating efficiencies, revenues and income to continue to operate as a going concern. We continue to focus on developing organic growth in our operating companies and improving gross and net margins through increased attention to pricing, cost management and overhead reductions. Critical to achieving profitability will be our ability to license and or sell, permit and operate our CoronaLux™ waste destruction units either through our joint ventures and/or licensees. We have increased our business development efforts to address opportunities identified in expanding markets attributable to increased interest in energy conservation and emission control regulations, particularly the landfill gas and oil field emissions sectors. In addition, the Company is evaluating various forms of financing which may be available to it, i.e., debt and/or equity financing while carefully evaluating the impact on share dilution. There can be no assurance that the Company will secure additional financing for working capital, increase revenues and achieve the desired result of net income and positive cash flow from operations in future years. These financial statements do not give any effect to any adjustments that would be necessary should the Company be unable to report on a going concern basis. Basis of presentation Unaudited Interim Financial Information The accompanying interim condensed consolidated financial statements are unaudited. In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all of the normal recurring adjustments necessary to present fairly the financial position and results of operations as of and for the periods presented. The interim results are not necessarily indicative of the results to be expected for the full year or any future period. Certain information and footnote disclosures normally included in the consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The Company believes that the disclosures are adequate to make the interim information presented not misleading. These consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto included in the Company’s Report on Form 10-K filed on April 14, 2017 for the years ended December 31, 2016 and 2015. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use of Estimates The preparation of these consolidated financial statements in conformity with accounting principles generally accepted in the United States (U.S. GAAP) requires management to make a number of estimates and assumptions related to the reported amount of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the period. Significant items subject to such estimates and assumptions include the carrying amount of intangible assets; valuation allowances and reserves for receivables and inventory and deferred income taxes; revenue recognition related to contracts accounted for under the percentage of completion method; share-based compensation; and loss contingencies, including those related to litigation. Actual results could differ from those estimates. Reclassifications Certain amounts in the prior period financial statements have been reclassified to conform to the current period presentation. These reclassifications had no effect on reported consolidated net income (loss). Revenue Recognition We recognize revenue related to contract projects and services when all of the following criteria are met: (i) persuasive evidence of an agreement exists, (ii) delivery has occurred or services have been rendered, (iii) the sales price is fixed or determinable, and (iv) collectability is reasonably assured. Our revenue is primarily comprised of services related to industrial cleaning and railcar cleaning, which we recognize as services are rendered. Product revenue generated from projects, which include the manufacturing of products, for removal and treatment of hazardous vapor and gasses is accounted for under the percentage-of-completion method for projects with durations in excess of three months and the completed-contract method for all other projects. Total estimated revenue includes all of the following: (1) the basic contract price, (2) contract options, and (3) change orders. Once contract performance is underway, we may experience changes in conditions, client requirements, specifications, designs, materials and expectations regarding the period of performance. Such changes are “change orders” and may be initiated by us or by our clients. In many cases, agreement with the client as to the terms of change orders is reached prior to work commencing; however, sometimes circumstances require that work progress without obtaining client agreement. Revenue related to change orders is recognized as costs are incurred if it is probable that costs will be recovered by changing the contract price. The Company does not incur pre-contract costs. Under the percentage-of-completion method, we recognize revenue primarily based on the ratio of costs incurred to date to total estimated contract costs. Provisions for estimated losses on uncompleted contracts are recorded in the period in which the losses are identified and included as additional loss. Provisions for estimated losses on contracts are shown separately as liabilities on the balance sheet, if significant, except in circumstances in which related costs are accumulated on the balance sheet, in which case the provisions are deducted from the accumulated costs. A provision as a liability is reported as a current liability. For contracts accounted for under the percentage-of-completion method, we include in current assets and current liabilities amounts related to construction contracts realizable and payable. Costs and estimated earnings in excess of billings on uncompleted contracts represent the excess of contract costs and profits recognized to date over billings to date, and are recognized as a current asset. Billings in excess of costs and estimated earnings on uncompleted contracts represents the excess of billings to date over the amount of contract costs and profits recognized to date, and are recognized as a current liability. The Company’s revenues from waste destruction licensing agreements are recognized as a single accounting unit over the term of the license. In accordance with Accounting Standards Codification (“ASC”) 605, for revenues which contain multiple deliverables, the Company separates the deliverables into separate accounting units if they meet the following criteria: (i) the delivered items have a stand-alone value to the customer; (ii) the fair value of any undelivered items can be reliably determined; and (iii) if the arrangement includes a general right of return, delivery of the undelivered items is probable and substantially controlled by the seller. Deliverables that do not meet these criteria are combined with one or more other deliverables into one accounting unit. Revenue from each accounting unit is recognized based on the applicable accounting literature, primarily ASC 605. Research and Development Research and development (“R&D”) costs are charged to expense as incurred. R&D expenses consist primarily of salaries, project materials, contract labor and other costs associated with ongoing product development and enhancement efforts. R&D expenses were $5,400 and $149,100 for the nine months ended September 30, 2017 and 2016, respectively. Income Taxes The Company accounts for income taxes pursuant to Accounting Standards Codification Income Taxes, ASC 740 also provides detailed guidance for the financial statement recognition, measurement and disclosure of uncertain tax positions recognized in the financial statements. Tax positions must meet a “more-likely-than-not” recognition threshold at the effective date to be recognized. During the nine months ended September 30, 2017 and 2016 the Company recognized no adjustments for uncertain tax positions. The Company recognizes interest and penalties related to uncertain tax positions in income tax expense. No interest and penalties related to uncertain tax positions were recognized at September 30, 2017 and December 31, 2016. The Company expects no material changes to unrecognized tax positions within the next twelve months. The Company has filed federal and state tax returns through December 31, 2016. The tax periods for the years ending December 31, 2010 through 2016 are open to examination by federal and state authorities. Recently issued accounting pronouncements Changes to accounting principles generally accepted in the United States of America (U.S. GAAP) are established by the Financial Accounting Standards Board (FASB) in the form of accounting standards updates (ASU’s) to the FASB’s Accounting Standards Codification. The Company considers the applicability and impact of all new or revised ASU’s. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 9 Months Ended |
Sep. 30, 2017 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | NOTE 3 - PROPERTY AND EQUIPMENT Property and equipment was comprised of the following: September 30, December 31, Field and shop equipment $ 2,085,000 $ 1,907,500 Vehicles 689,700 690,000 Waste destruction equipment, placed in service 927,100 1,299,500 Waste destruction equipment, not placed in service 656,200 712,100 Furniture and office equipment 322,700 319,700 Leasehold improvements 10,000 10,000 Building and improvements 21,200 21,200 Land 162,900 162,900 4,874,800 5,122,900 Less: accumulated depreciation and amortization (2,652,000 ) (2,317,800 ) Property and equipment, net $ 2,222,800 $ 2,805,100 Depreciation expense for the three months ended September 30, 2017 and 2016 was $165,900 and $165,600, respectively and for the nine months ended September 30, 2017 and 2016 was $485,800 and $502,600, respectively. For the three months ended September 30, 2017 depreciation expense included in cost of goods sold and selling, general and administrative expenses was $136,600 and $29,300 respectively. For the nine months ended September 30, 2017 depreciation expense included in cost of goods sold and selling, general and administrative expenses was $407,500 and $78,300, respectively. For the three months ended September 30, 2016 depreciation expense included in cost of goods sold and selling, general and administrative expenses was $132,800 and $29,300 respectively. For the nine months ended September 30, 2016 depreciation expense included in cost of goods sold and selling, general and administrative expenses was $430,100 and $72,500, respectively. Accumulated depreciation on leased CoronaLux™ units included in accumulated depreciation and amortization above is $422,500 and $271,700 as of September 30, 2017 and 2016, respectively. Property and equipment included the following amounts for leases that have been capitalized at: September 30, December 31, Vehicles, field and shop equipment $ 318,300 $ 462,700 Less: accumulated amortization (211,500 ) (222,800 ) $ 106,800 $ 239,900 |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 9 Months Ended |
Sep. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS | NOTE 4 – INTANGIBLE ASSETS Intangible assets were comprised of the following: September 30, 2017 Gross carrying amount Accumulated amortization Net carrying value Goodwill $ 277,800 $ — $ 277,800 Customer list 42,500 (42,500 ) — Technology 1,087,400 (721,200 ) 366,200 Trade name 54,900 (54,900 ) — $ 1,462,600 $ (818,600 ) $ 644,000 December 31, 2016 Gross carrying amount Accumulated amortization Net carrying value Goodwill $ 277,800 $ — $ 277,800 Customer list 42,500 (42,500 ) — Technology 1,069,500 (609,300 ) 460,200 Trade name 57,300 (57,300 ) — $ 1,447,100 $ (709,100 ) $ 738,000 The estimated useful lives of the intangible assets range from seven to ten years. Amortization expense was $24,400 and $25,200 for the three months ended September 30, 2017 and 2016, respectively and $109,500 and $68,200 for the nine months ended September 30, 2017 and 2016, respectively. |
ACCRUED LIABILITIES
ACCRUED LIABILITIES | 9 Months Ended |
Sep. 30, 2017 | |
Payables and Accruals [Abstract] | |
ACCRUED LIABILITIES | NOTE 5 - ACCRUED LIABILITIES Accrued liabilities were comprised of the following: September 30, December 31, Accrued compensation and related taxes $ 477,700 $ 644,800 Accrued interest 45,900 58,900 Accrued litigation claims 143,400 277,500 Other 576,800 399,800 Total Accrued Liabilities $ 1,243,800 $ 1,381, 000 |
UNCOMPLETED CONTRACTS
UNCOMPLETED CONTRACTS | 9 Months Ended |
Sep. 30, 2017 | |
Contractors [Abstract] | |
UNCOMPLETED CONTRACTS | NOTE 6 - UNCOMPLETED CONTRACTS Costs, estimated earnings and billings on uncompleted contracts are as follows: September 30, December 31, 2017 2016 Revenue Recognized $ — $ 324,500 Less: Billings to date — (310,900 ) Costs and estimated earnings in excess of billings on uncompleted contracts $ — $ 13,600 Billings to date $ 2,669,600 $ 3,063,500 Revenue recognized (2,069,500 ) (1,972,700 ) Billings in excess of costs and estimated earnings on uncompleted contracts $ 600,100 $ 1,090,800 |
INVESTMENT IN PARAGON WASTE SOL
INVESTMENT IN PARAGON WASTE SOLUTIONS LLC | 9 Months Ended |
Sep. 30, 2017 | |
Business Combinations [Abstract] | |
INVESTMENT IN PARAGON WASTE SOLUTIONS LLC | NOTE 7– INVESTMENT IN PARAGON WASTE SOLUTIONS LLC In 2010, the Company and Black Stone Management Services, LLC (“Black Stone”) formed PWS, whereby a total of 1,000,000 membership units were issued, 600,000 membership units to the Company and 400,000 membership units to Black Stone. Fortunato Villamagna, who serves as President of our PWS subsidiary, is a managing member and Chairman of Black Stone. In June 2012, the Company and Blackstone each allocated 10% of their respective membership units in PWS to Mr. J John Combs III, an officer and shareholder of the Company and Mr. Michael Cardillo, a shareholder of the Company and an officer of a subsidiary. There was no value attributable to the units at the time of the allocation. At June 30, 2017 and December 31, 2016, the Company owned 54% of the membership units, Black Stone owned 26% of the membership units, an outside third party 10% of the membership units and two related parties (as noted above), each owned 5% of the membership units. In August, 2011, we acquired certain intellectual property in regards to waste destruction technology (the “IP”) from Black Stone in exchange for 1,000,000 shares of our common stock valued at $100,000. We estimated the useful life of the IP at ten years, which was consistent with the useful life of other technology included in our intangible assets, and management’s initial assessment of the potential marketability of the IP. Since its inception through September 30, 2017, we have provided approximately $6 million in funding to PWS for working capital and the further development and construction of various prototypes and commercial waste destruction units. No members of PWS have made capital contributions or other funding to PWS other than SEER. The intent of the operating agreement is that we will provide the funding as an advance against future earnings distributions made by PWS. Licensing Agreements In 2014, Sterall ordered a total of six CoronaLux™ units, of which one unit was delivered during the year ending December 31, 2014, and five units have been pending delivery since that time. Sterall paid a non-refundable placement fee of $236,300 for the unit delivered in 2014 which the Company has been recognizing over the term of the agreement. Sterall also paid a deposit of $330,000 for the five units ordered leaving a balance of $851,500 still owed. The Company fully reserved the amount owed. In July 2017, the Company and Sterall signed a Settlement Agreement and Mutual Release which allows Sterall to keep the one unit delivered in 2014 and another unit also on site, in exchange for the Company’s retention of the $330,000 deposit paid by Sterall and the issuance of 300,000 shares of restricted common stock. Sterall also forfeits all rights to operate the CoronoLux technology anywhere in the U.S. territories, but is granted an exclusive right to operate the systems in the limited and sole territory of Haiti for a period of 10 years in exchange for a 5% royalty payable to the Company on gross revenue derived from any source arising out of or related to the operation of the CoronoLux technology. On February 22, 2014, SEER and PWS entered into an Agreement with Daniel McAteer & Associates (“DMA”) to develop, permit and exploit the PWS waste destruction technology in Ireland and United Kingdom (“Limited Territory”). The Agreement called for the formation of a Joint Venture to be owned 50% by SEER and 50% by DMA. In accordance with the agreement, DMA was to pay a one-time license fee of $350,000 for an exclusive license for the limited purpose of medical waste destruction in the Limited Territory. On June 10, 2014 Paragon Waste (UK) Ltd (“Paragon UK”, “UK Joint Venture”), was formed in accordance with the laws of Northern Ireland. A total of 300,100 shares were issued upon formation, 100 Ordinary A voting shares were issued, of which PWS received 50 Ordinary A shares and 300,000 Ordinary B non-voting shares were issued. In 2015, the Agreement with DMA was amended to where Paragon UK purchased the CoronaLux™ unit from PWS for $350,000. Operations to date of the Paragon UK Joint Venture have been limited to formation, the delivery of a CoronaLux™ unit with a third party in the United Kingdom and application and permitting efforts with regulatory entities. As of September 30, 2017, a balance of $176,000 is still owed and has been fully reserved by the Company. On March 4, 2014, PWS entered into a Licensing and Equipment Lease Agreement with eCycling International of South Carolina, LLC (“eCycling”). The License Agreement grants to eCycling the use of the PWS Technology and the CoronaLux™ waste destruction units for an initial term of five years and requires a payment of $176,875 as a non-refundable initial licensing fee and distributions of 50% of net operating profits, as defined in the agreement, in lieu of continuing royalty payments for the use of the licensed technology. eCycling originally paid the $176,875 placement fee to PWS and an additional $176,875 per the amended agreement during the year ended December 31, 2016 and the revenue is being recognized over the term of the Agreement. eCycling is still in the process of permitting the unit, and therefore, has not yet generated any NOP. On November 17, 2014, PWS entered into an Exclusive Licensing and Equipment Lease Agreement, for a limited license territory, with Medical Waste Services, LLC (“MWS”). The License Agreement grants to MWS the use of the PWS Technology and the CoronaLux™ waste destruction units for an initial term of seven years and requires a payment of $225,000 as a non-refundable initial licensing fee and distributions of 50% of net operating profits, as defined in the agreement, in lieu of continuing royalty payments for the use of the licensed technology. PWS and Medical Waste Services, LLC (“MWS”) formed a contractual joint venture to exploit the PWS medical waste destruction technology. MWS has received approval from the California Department of Public Health and a restricted permit from the South Coast Air Quality Management District (“SCAQMD”) to operate the CoronaLux™ unit licensed by MWS at its facility in Southern California. Operations to date have included the destruction of medical waste under a temporary operating permit issued by SCAQMD since May 2015 and efforts to obtain a full operating permit from SCAQMD were successful and SCAQMD issued a ‘Notice of Intent to Issue Permit to Operate’ in March 2017. In August 2017, the full operating permit had been reviewed and verbally approved by SCAQMD, however, the Company has not yet received the full operating permit as of September 30, 2017. In February 2015, PWS entered into a License Agreement with Particle Science Tech of Environmental Protection, Inc (“Particle”) a US subsidiary of Xinhua Energy Environmental Technology Co., Ltd (“Xinhua”), a large multi-national environmental company based in China. The agreement provides for the exclusive rights to distribute PWS’s patented technology in China, Hong Kong, Macau and the Taiwan territories (“Territory”). The grant was for both the medical waste, as well as the refinery vertical markets within the Territory. The Agreement calls for, among other things, the formation of a U.S. joint venture company, (“P&P Company”, to be owned 50/50 by PWS and Particle) and an obligation by Xinhua to fund all necessary and reasonable capital requirements to permit and roll out the PWS technology in the Territory as well as staff and manage the JV Entity’s operations. In 2015, PWS sold a CoronaLux™ unit to Xinhua for $430,500. Upon the occurrence of certain events and timely performance by Xinhua, a second placement fee of $350,000 is required to be paid and, upon that second payment, it will then be granted exclusive manufacturing rights to produce the units to be deployed in the Territory. Payments received for non-refundable licensing and placement fees have been recorded as deferred revenue in the accompanying consolidated balance sheets at September 30, 2017 and December 31, 2016 and are recognized as revenue ratably over the term of the contract. |
PAYROLL TAXES PAYABLE
PAYROLL TAXES PAYABLE | 9 Months Ended |
Sep. 30, 2017 | |
Payroll Taxes Payable | |
PAYROLL TAXES PAYABLE | NOTE 8 - PAYROLL TAXES PAYABLE In 2009 and 2010, REGS, a subsidiary of the Company, became delinquent for unpaid federal employer and employee payroll taxes, accrued interest and penalties were incurred related to these unpaid payroll taxes. Two of the officers of REGS also have personal liability exposure for a portion of the taxes if REGS does not pay them. In May 2013, REGS filed an Offer in Compromise (“OIC”) with the IRS. While the OIC was under review by the IRS, the requirement to pay $25,000 a month under the Installment Plan was suspended. REGS was informed by its legal counsel that the IRS had accepted REGS’ OIC. However, by a letter dated March 27, 2014, REGS was notified that the OIC had been rejected. REGS then appealed that rejections decision. However, that appeal has been denied. As a result, the Installment Plan is terminated. In June 2014, REGS received notices of intent to levy property or rights to property from the IRS for the amounts owed for the past due payroll taxes, penalty and interest. The IRS has not taken any current action against REGS and REGS continues to be represented by its legal counsel. As of September 30, 2017, and December 31, 2016, the outstanding balance due to the IRS was $992,000, and $993,300, respectively. Other than this outstanding payroll tax matter arising in 2009 and 2010, all state and federal taxes have been paid by REGS in a timely manner. |
DEBT
DEBT | 9 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
DEBT | NOTE 9 – DEBT Debt as of September 30, 2017 and December 31, 2016, was comprised of the following: 2017 2016 Convertible notes payable, interest at 8% per annum, unpaid principal and interest maturing 3 years from note date between August 2018 and October 2019, convertible into common stock at the option of the lenders at a rate of $0.70 per share; one convertible note for $250,000 has a personal guarantee of an officer of the Company. 1,605,000 1,605,000 Debt discount on convertible notes (9,200 ) (14,900 ) Secured short term note payable dated October 24, 2016 with principal and interest due 60 days from issuance. The note requires a one-time fee in the amount of $10,000 to compensate for the first two weeks of the term and each week thereafter (weeks 3-8) a fee of $1,000 shall be due and owing accruing on the first day of the week. A fee of 100,000 shares of restricted common stock shall be issued as a penalty for each month or prorated for any two-week portion of any month the note is outstanding for months 3 through 6, and a fee of 200,000 shares of restricted common stock shall be issued to lender for each month or prorated for each two-week portion of any month the note is outstanding beginning in month 7 until paid in full. The note is secured by specific customer accounts receivables and a personal guarantee of an officer of the Company. This note was paid in full in April 2017. The penalty period for shares to be issued was reached and the Company issued 350,000 shares of its common stock under the terms of this agreement. The shares were valued at $245,000 recorded as interest expense. — 200,000 Secured short term note payable dated December 1, 2016 with principal and interest due 60 days from issuance. The note requires a one-time fee in the amount of $10,000 to compensate for the first two weeks of the term and each week thereafter (weeks 3-8) a fee of $1,000 shall be due and owing accruing on the first day of the week. A fee of 100,000 shares of restricted common stock shall be issued as a penalty for each month or prorated for any two-week portion of any month the note is outstanding for months 3 through 6, and a fee of 200,000 shares of restricted common stock shall be issued to lender for each month or prorated for each two-week portion of any month the note is outstanding beginning in month 7 until paid in full. The note is secured by specific customer accounts receivables and a personal guarantee of an officer of the Company. This note was paid in full in August 2017. The penalty period for shares to be issued was reached and the Company issued 800,000 shares of its common stock under the terms of this agreement. The shares were valued at $531,000 recorded as interest expense. — 200,000 Secured short term note payable dated January 23, 2017 with principal and interest due 60 days from issuance. The note requires a one-time fee in the amount of $10,000 to compensate for the first two weeks of the term and each week thereafter (weeks 3-8) a fee of $1,000 shall be due and owing accruing on the first day of the week. A fee of 100,000 shares of restricted common stock shall be issued as a penalty for each month or prorated for any two-week portion of any month the note is outstanding for months 3 through 6, and a fee of 200,000 shares of restricted common stock shall be issued to lender for each month or prorated for each two-week portion of any month the note is outstanding beginning in month 7 until paid in full. The note is secured by specific customer accounts receivables and a personal guarantee of an officer of the Company. This note was paid in full in August 2017. The penalty period for shares to be issued was reached and the Company issued 150,000 shares of its common stock under revised terms of the agreement. The shares were valued at $105,000 recorded as interest expense. No additional shares will be issued by the Company. — — Secured short term note payable dated March 30, 2017 with principal and interest due 60 days from issuance. The note requires a one-time fee in the amount of $10,000 to compensate for the first two weeks of the term and each week thereafter (weeks 3-8) a fee of $1,000 shall be due and owing accruing on the first day of the week. A fee of 100,000 shares of restricted common stock shall be issued as a penalty for each month or prorated for any two-week portion of any month the note is outstanding for months 3 through 6, and a fee of 200,000 shares of restricted common stock shall be issued to lender for each month or prorated for each two-week portion of any month the note is outstanding beginning in month 7 until paid in full. The note is secured by specific customer accounts receivables and a personal guarantee of an officer of the Company. This note was paid in full in August 2017. The penalty period for shares to be issued was reached and the Company recorded 200,000 shares of its common stock under the terms of this agreement. The shares were valued at $128,000 recorded as interest expense. Additional shares will be issued by the Company under the terms of the agreement. — — Secured short term note payable dated September 13, 2017 with principal and interest due 60 days from issuance. The note requires a one-time fee in the amount of $15,000 to compensate for the first two weeks of the term and each week thereafter (weeks 3-8) a fee of $1,500 shall be due and owing accruing on the first day of the week. A fee of 100,000 shares of restricted common stock shall be issued as a penalty for each month or prorated for any two-week portion of any month the note is outstanding for months 3 through 6, and a fee of 200,000 shares of restricted common stock shall be issued to lender for each month or prorated for each two-week portion of any month the note is outstanding beginning in month 7 until paid in full. The note is secured by the future sale of CoronaLux units and a personal guarantee of an officer of the Company. 300,000 — Note payable dated October 13, 2015, interest at 8% per annum, payable in 24 monthly installments of principal and interest $4,523, due October 1, 2017. Secured by certain assets of SEM and guaranteed by SEER and MV 4,500 43,600 Note payable dated October 13, 2015, interest at 8% per annum, payable in 60 monthly installments of principal and interest $4,562, due October 1, 2020. Secured by real estate and other assets of SEM and guaranteed by SEER and MV 148,700 180,000 Note payable insurance premium financing, interest at 4.25% per annum, payable in 10 installments of $44,706, due November 1, 2017 42,000 — Capital lease obligations, secured by certain assets, maturing through March 2019 49,200 109,600 Total notes payable and capital lease obligations 2,140,200 2,323,300 Less: current portion (425,000 ) (571,800 ) Notes payable and capital lease obligations, long-term, including debt discount $ 1,715,200 $ 1,751,500 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Sep. 30, 2017 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 10 – RELATED PARTY TRANSACTIONS Notes payable, related parties Related parties accrued interest due to certain related parties as of September 30, 2017 and December 31, 2016 are as follows: 2017 2016 Accrued interest $ 11,800 $ 11,800 $ 11,800 $ 11,800 We believe the stated interest rates on the related party notes payable represent reasonable market rates based on the note payable arrangements we have executed with third parties. In March 2012, the Company entered into an Irrevocable License & Royalty Agreement with PWS that grants PWS an irrevocable world-wide license to the IP in exchange for a 5% royalty on all revenues from PWS and its affiliates. The term shall commence as of the date of this Agreement and shall continue for a period not to exceed the life of the patent or patents filed by the Company. PWS may sub license the IP and any revenue derived from sub licensing shall be included in the calculation of Gross Revenue for purposes of determining royalty payments due the Company. Royalty payments are due 30 days after the end of each calendar quarter. PWS generated licensing revenues of approximately $127,900 for the nine months ended September 30, 2017 and $205,000 for the year ended December 31, 2016, as such, royalties of approximately $23,600 and $17,200 were due at September 30, 2017 and December 31, 2016, respectively. In August 2014, the Company entered into a second Exchange and Acquisition Agreement (“New Technologies Agreement”) with Black Stone for the acquisition of additional intellectual property (“IP”) from Black Stone in exchange for 1,000,000 shares of common stock valued at $1,050,000. In 2015 the Company and Black Stone executed a rescission agreement of the New Technologies Agreement noted above that was effective December 31, 2014. The shares issued by the Company in accordance with the agreement were returned and all acquired IP returned to Black Stone. In September 2014, the Company entered into an Equity Purchase Agreement (“Equity Agreement”) with a third party (“Seller”) whereby the Company issued 1,200,000 shares of the Company’s common stock, valued at $1,212,000, in exchange for 22.5 membership interest units, representing 15% ownership interest in Sterall, LLC, a Delaware corporation. In March 2015, the Company and the Seller entered into a revised agreement whereby the 1,200,000 shares issued by the Company would be held by the Seller until the completion of an independent third-party valuation. Based on the fair market value of the Purchased Units from the valuation obtained by the Company, an amount of Consideration Shares will be returned to the Company to the extent that the fair market value of the Consideration Shares issued (see below) are greater than the fair market value of the Purchased Units. In no event shall the Company be obligated to issue additional shares as consideration for the Purchased Units. For purposes of this amendment, the fair market value of each Consideration Share will be $0.83333. In the event the parties are unwilling to accept the fair market value of the Purchased Units, as determined by the independent valuation specialist, on or before the Closing Date this Agreement, the transaction covered by this Agreement (the “Contemplated Transaction”) may be rescinded by either Party in writing. In December 2014, PWS, Sterall, Inc and Sterall LLC entered into a Successor-In-Interest Agreement. The Successor-In-Interest Agreement states that Sterall Inc and Sterall LLC are in the process of consolidating their business under Sterall LLC and all agreements between PWS and Sterall Inc shall be binding in all regards Sterall LLC. In October 2014, PWS and Medical Waste Services, LLC (“MWS”) formed a contractual joint venture to exploit the PWS medical waste destruction technology. In 2015, MWS licensed and installed a CoronaLux unit at an MWS facility, and subsequently received a limited permit to operate. Operations to date have included the destruction of medical waste. For the nine months ended September 30, 2017 and the year ended December 31, 2016, PWS has recorded $19,000 and $15,700 in income which represents their 50% interest in the net income of the joint venture, respectively. In addition, for the nine months ended September 30, 2017 and the year ended December 31, 2016, PWS billed the joint venture approximately $57,000 and $68,000 in costs incurred on behalf of the joint venture, respectively. Due to the ability of the Company to rescind the shares issued at the commencement of the transaction the shares were considered contingently issuable shares and as such the 1,200,000 shares not considered issued and outstanding at December 31, 2015. The 15% ownership interest in Sterall was considered contingently held until the conclusion of this transaction. As of December 31, 2015, an independent appraisal was not performed and the Amended Equity Agreement expired by its terms. The 1,200,000 shares subject to the original Equity Agreement and the Amended Equity Agreement became unrestricted in 2016 and are now considered issued and outstanding. The shares were valued at $720,000 and have been recorded as a long term other asset pending resolution of claims by the parties involved related to the Sterall licensing agreement from September 2013, Sterall equipment deposits of $330,000 from 2014 and the equity purchase agreement noted above. As of December 31, 2016, a settlement has not been reached by the parties however, they continue to negotiate an agreement and an impairment of the long term asset in the amount of $720,000 was recorded by the Company. In July 2017, the Company and Sterall signed a Settlement Agreement and Mutual Release which allows Sterall to keep the one unit delivered in 2014 and another unit also on site, in exchange for the Company’s retention of the $330,000 deposit paid by Sterall and the issuance of 300,000 shares of restricted common stock. (see Note 7) |
ASSETS AND LIABILITIES HELD FOR
ASSETS AND LIABILITIES HELD FOR SALE AND DISCONTINUED OPERATIONS | 9 Months Ended |
Sep. 30, 2017 | |
Assets And Liabilities Held For Sale And Discontinued Operations | |
ASSETS AND LIABILITIES HELD FOR SALE AND DISCONTINUED OPERATIONS | NOTE 11 – ASSETS AND LIABILITIES HELD FOR SALE AND DISCONTINUED OPERATIONS During the third quarter of 2017, we sold our fixed railcar cleaning division which includes substantially all assets and liabilities of Tactical (except for cash) as well as three locations in REGS including Illinois, Maryland and Pennsylvania for a sales price of $2.4 million of proceeds received at the close on July 31, 2017, subject to an adjustment for working capital changes, and guaranteed payments of $1.1 million over the next three years. In addition, the Company is entitled to receive another $1.5 million based on the performance of the fixed railcar cleaning locations, also over the next three years. Accordingly, the carrying value of the assets and liabilities associated with the railcar cleaning locations are presented as “Assets held for sale” and “Liabilities held for sale” on our consolidated balance sheet as of December 31, 2016, and “Discontinued operations” on our consolidated statement of operations for three and nine months ending September 30, 2017 and September 30, 2016, and on our consolidated statement of cash flows for the nine months ending September 30, 2017 and September 30, 2016. The sale was completed on July 31, 2017. For the nine months ended September 30, 2017 we recorded net income from discontinued operations and a gain on the sale of rail operations equal to $693,700 and $2,663,800, respectively. Assets and liabilities held for sale were comprised of the following: September, December 31, Accounts receivable, net $ — $ 841,800 Property and equipment, net — 156,200 Other — 26,600 Total Assets held for sale $ — $ 1,024,600 Accounts payable $ — $ 513,500 Accrued expenses and other — 89,600 Total Liabilities held for sale $ — $ 603,100 Major classes of line items constituting pretax loss on discontinued operations: For the three months ending For the nine months ending 2017 2016 2017 2016 Services revenue $ 757,100 $ 877,800 $ 4,082,200 $ 2,854,100 Services costs 489,800 714,500 3,070,200 2,144,500 General and administrative expenses 23,000 35,400 117,800 118,400 Salaries and related expenses 27,700 70,400 208,900 192,300 Other (income) expense 1,200 300 (8,400 ) 1,300 Total expenses 541,700 820,600 3,388,500 2,456,500 Operating income 215,400 57,200 693,700 397,600 Income tax benefit — — — — Total income from discontinued operations $ 215,400 $ 57,200 $ 693,700 $ 397,600 Total gain on disposal of rail operations: September 30, Consideration from sale $ 2,400,000 Net present value of future consideration 961,500 Carrying value of net assets* (574,100 ) Gross gain on disposal 2,787,400 Additional costs on disposal Commissions (96,000 ) Accounting (18,500 ) (114,500 ) Total gain on sale of rail operations $ 2,672,900 *Carrying value of net assets Accounts receivable, net $ 1,130,500 Property and equipment, net 177,200 Other 60,200 Total Assets $ 1,367,900 Accounts payable $ 771,900 Accrued expenses and other 21,900 Total Liabilities $ 793,800 Carrying value of net assets $ 574,100 |
EQUITY TRANSACTIONS
EQUITY TRANSACTIONS | 9 Months Ended |
Sep. 30, 2017 | |
Equity [Abstract] | |
EQUITY TRANSACTIONS | NOTE 12 – EQUITY TRANSACTIONS 2017 During the nine months ended September 30, 2017, the Company issued 200,000 warrants, in connection with consulting services provided, exercisable for 5 years at $0.70 per share and valued at $31,300 using the Black Scholes valuation method. During the nine months ended September 30, 2017, the Company issued 300,000 shares of $.001 par value common stock valued at $174,000 in connection with a settlement agreement. (See Note 7) During the nine months ended September 30, 2017, the Company issued 300,000 shares of $.001 par value common stock valued at $189,000 in connection with the late payment penalty due on short-term notes. (See Note 9) During the nine months ended September 30, 2017, the Company recorded 700,000 shares of $.001 par value common stock valued at $475,000 as issuable to short-term note holders as required under their respective agreements. (See Note 9) During the nine months ended September 30, 2017, the Company issued 500,000 shares of $.001 par value common stock valued at $345,000 in connection with the late payment penalty due on short-term notes. (See Note 9) During the nine months ended September 30, 2017, the Company issued 13,496 shares of its $.001 par value common stock upon the cashless exercise of 166,666 common stock options. During the nine months ended September 30, 2017, the Company issued an option to purchase 1,000,000 shares of its $.001 par value common stock at a strike price of $1.00 to Richard Robertson in connection with his employment agreement dated January 9, 2017. At the date of issuance 100,000 shares vested immediately and the remaining 900,000 options vest over a period of four years in a series of 16 successive equal quarterly vesting of 56,250 options commencing March 31, 2017 and ending December 31, 2020. The Company used the Black Scholes option pricing model to estimate the fair value of the options granted at $102,354. The assumptions used in calculating such value include a risk-free interest rate of 1.89%, expected volatility of 36.87%, an expected life of 5.5 years and a dividend rate of 0. During the nine months ended September 30, 2017, the Company issued an option to purchase 1,000,000 shares of its $.001 par value common stock at a strike price of $0.70 to Don Moorhead in connection with his agreement dated May 1, 2017. The options vest over a period of two years in a series of 8 successive equal quarterly installments of 125,000 commencing July 1, 2017 and ending April 1, 2019. The Company used the Black Scholes option pricing model to estimate the fair value of the options granted at $231,514. The assumptions used in calculating such value include a risk-free interest rate of 1.84%, expected volatility of 39.17%, an expected life of 4.5 years and a dividend rate of 0. During the nine months ended September 30, 2017, the Company and certain warrant holders entered into agreements in which the Company agreed to extend the expiration date of then outstanding warrants by 12 months to acquire 2,966,191 shares of common stock of the Company. Certain warrant holders were offered the extensions at no additional cost to the warrant holder, while others agreed to pay the Company approximately $160,760 for the extensions. As of September 30, 2017, one of the warrant holders is making monthly payments with approximately $12,260 remaining outstanding. The Company recorded stock based compensation expense of $83,677 for those warrant holders granted extensions without compensation to the Company. 2016 During the nine months ended September 30, 2016, the Company sold 600,000 shares of $.001 par value common stock at $.50 per share in a private placement, receiving proceeds of $300,000. During the nine months ended September 30, 2016 the Company (i) issued 100,000 shares of $.001 par value common stock in connection with the payment of a common stock subscription of $25,000. During the nine months ended September 30, 2016, the Company issued 250,000 shares of its $.001 par value common stock upon exercise of common stock warrants receiving proceeds of $125,000. During the nine months ended September 30, 2016, the Company treated as issued 1,200,000 shares of its $.001 par value common stock valued at $720,000 in connection with the Sterall transaction (see Note 7). During the nine months ended September 30, 2016, the Company issued 60,000 common stock options to employees exercisable at $.60 per share. In the third quarter of 2016, the Company issued $250,000 in convertible debt that is convertible into 357,142 shares of its $.001 par value common stock. In May 2016, the Company issued 500,000 warrants, in connection with a short-term financing, exercisable at $.50 per share for a period of four years. On September 30, 2016, the Company issued 50,000 warrants, in connection with a convertible debt issuance, exercisable for five years at $.85 per share and were valued at $4,900 using the Black Scholes valuation method. Non-controlling Interest The non-controlling interest presented in our condensed consolidated financial statements reflects a 46% non-controlling equity interest in PWS (see Note 7). Net loss attributable to non-controlling interest, as reported on our condensed consolidated statements of operations, represents the net loss of PWS attributable to the non-controlling equity interest. The non-controlling interest is reflected within stockholders’ equity on the condensed consolidated balance sheet. |
CUSTOMER CONCENTRATIONS
CUSTOMER CONCENTRATIONS | 9 Months Ended |
Sep. 30, 2017 | |
Risks and Uncertainties [Abstract] | |
CUSTOMER CONCENTRATIONS | NOTE 13 – CUSTOMER CONCENTRATIONS For the three months ended September 30, 2017, the Company had sales from operations to one customer that represented approximately 17% of total sales. For the nine months ended September 30, 2017, the Company did not have sales representing more than 10% to any one customer. The Company had sales from operations to two customers for the three months ended September 30, 2016 that represented approximately 38% of total sales, and had one customer for the nine months ended September 30, 2016 that represented approximately 22% of our total sales. The concentration of the Company’s business with a relatively small number of customers may expose us to a material adverse effect if one or more of these large customers were to experience financial difficulty or were to cease being customer for non-financial related issues. |
NET LOSS PER SHARE
NET LOSS PER SHARE | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
NET LOSS PER SHARE | NOTE 14 – NET LOSS PER SHARE Basic net loss per share is computed by dividing net loss attributable to common shareholders by the weighted average number of common shares outstanding. Diluted net loss per share is computed by dividing net loss attributable to common shareholders by the weighted average number of common shares outstanding plus the number of common shares that would be issued assuming exercise or conversion of all potentially dilutive common shares. Potentially dilutive securities are excluded from the calculation when their effect would be anti-dilutive. For all years presented in the consolidated financial statements, all potentially dilutive securities have been excluded from the diluted share calculations as they were anti-dilutive as a result of the net losses incurred for the respective years. Accordingly, basic shares equal diluted shares for all years presented. Potentially dilutive securities were comprised of the following: Nine Months Ended 2017 2016 Warrants 8,861,441 9,664,430 Options 2,155,000 990,000 Convertible notes payable, including accrued interest 2,339,091 1,493,505 13,355,532 12,447,935 |
ENVIRONMENTAL MATTERS AND REGUL
ENVIRONMENTAL MATTERS AND REGULATION | 9 Months Ended |
Sep. 30, 2017 | |
Environmental Remediation Obligations [Abstract] | |
ENVIRONMENTAL MATTERS AND REGULATION | NOTE 15 - ENVIRONMENTAL MATTERS AND REGULATION Significant federal environmental laws affecting us are the Resource Conservation and Recovery Act (“RCRA”), the Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”), also known as the “Superfund Act”, the Clean Air Act, the Clean Water Act and the Toxic Substances Control Act (“TSCA”). Pursuant to the EPA’s authorization of the RCRA equivalent programs, a number of states have regulatory programs governing the operations and permitting of hazardous waste facilities. Our facilities are regulated pursuant to state statutes, including those addressing clean water and clean air. Our facilities are also subject to local siting, zoning and land use restrictions. We believe we are in substantial compliance with all federal, state and local laws regulating our business. |
SEGMENT INFORMATION AND MAJOR C
SEGMENT INFORMATION AND MAJOR CUSTOMERS | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION AND MAJOR CUSTOMERS | NOTE 16 - SEGMENT INFORMATION AND MAJOR CUSTOMERS The Company currently has identified three segments as follows: REGS Industrial Cleaning MV and SEM Environmental Solutions PWS Solid Waste Reach has had minimal operations through September 30, 2017. Substantially all of the assets and liabilities of Tactical, the rail car cleaning segment, was sold July 31, 2017 (Note 11). The composition of our reportable segments is consistent with that used by our Chief Operating Decision Maker (“CODM”) to evaluate performance and allocate resources. All of our operations are located in the U.S. We have not allocated corporate selling, general and administrative expenses, and stock-based compensation to the segments. All intercompany transactions have been eliminated. Segment information for the three months ended September 30, 2017 and 2016 is as follows: 2017 Industrial Environmental Solid Cleaning (2) Solutions Waste Corporate Total (3) Revenue $ 413,000 $ 717,300 $ 453,100 $ — $ 1,583,400 Depreciation and amortization (1) 87,800 37,000 33,500 28,300 186,600 Interest expense 5,400 3,300 — 247,300 256,000 Stock-based compensation — — — 37,200 37,200 Net income (loss) (319,900 ) (64,700 ) (53,200 ) (940,200 ) (1,378,000 ) Capital expenditures (cash and noncash) 179,100 — — — 179,100 Total assets $ 673,400 1,749,800 $ 1,451,800 $ 1,802,900 $ 5,677,900 2016 Industrial Environmental Solid Cleaning (2) Solutions Waste Corporate Total (3) Revenue $ 167,600 $ 1,749,100 $ 41,900 $ — $ 1,958,600 Depreciation and amortization (1) 81,700 42,700 31,500 24,800 180,700 Interest expense 7,600 5,300 — 42,800 55,700 Stock-based compensation — — — 10,900 10,900 Net income (loss) (558,700 ) 217,000 (197,800 ) (391,500 ) (931,000 ) Capital expenditures (cash and noncash) 6,300 — 5,200 — 11,500 Total assets $ 1,118,300 $ 2,349,300 $ 2,914,500 $ 1,083,100 $ 7,465,200 Segment information for the nine months ended September 30, 2017 and 2016 is as follows: 2017 Industrial Environmental Solid Cleaning (2) Solutions Waste Corporate Total (3) Revenue $ 1,803,000 $ 4,268,800 $ 596,900 $ — $ 6,668,700 Depreciation and amortization (1) 257,700 153,400 108,700 75,500 595,300 Interest expense 17,800 12,300 100 1,182,300 1,212,500 Stock-based compensation — — — 94,000 94,000 Net income (loss) (789,100 ) 395,700 (252,100 ) (2,967,400 ) (3,612,900 ) Capital expenditures (cash and noncash) 239,500 1,300 — — 240,800 Total assets $ 673,400 1,749,800 $ 1,451,800 $ 1,802,900 $ 5,677,900 2016 Industrial Environmental Solid Cleaning (2) Solutions Waste Corporate Total (3) Revenue $ 2,423,800 $ 3,454,500 $ 170,100 $ — $ 6,048,400 Depreciation and amortization (1) 251,100 125,500 96,300 98,000 570,900 Interest expense 25,100 17,500 500 212,100 255,200 Stock-based compensation — — — 84,000 84,000 Net income (loss) 88,500 91,000 (303,400 ) (1,022,500 ) (1,146,400 ) Capital expenditures (cash and noncash) 129,400 12,900 12,100 — 154,400 Total assets $ 1,118,300 $ 2,349,300 $ 2,914,500 $ 1,083,100 $ 7,465,200 (1) Includes depreciation of property, equipment and leasehold improvement and amortization of intangibles. (2) Includes mobile rail car cleaning and excludes locations classified as discontinued operations. (3) Excludes discontinued operations. |
LITIGATION
LITIGATION | 9 Months Ended |
Sep. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
LITIGATION | NOTE 17 – LITIGATION In March 2016, a complaint was filed by a lessor of property leased by REGS, a subsidiary of the Company. The month-to-month lease expired February 29, 2016, when REGS vacated the property. The landlord made certain claims including property damage, and loss of rents, attorney fees and other costs totaling approximately $97,000. REGS engaged defense counsel and zealously opposed the claims. In December 2016, the Company and the lessor reached a settlement of $65,000. At September 30, 2017 and December 31, 2016 $0 and $39,000 was outstanding, respectively. The case was dismissed with prejudiced and the matter is closed. In January 2016, an employee of SEM was involved in a vehicle accident while on Company business. Various actions were filed by the claimants in both state and federal courts. In August 2016, an involuntary proceeding was commenced by one of the claimants against SEM under Chapter 7 of the Bankruptcy code. In September 2016, the case was converted to a Chapter 11 under the Bankruptcy code. During the pendency of all actions, SEM continued to manage its affairs and operate normally. In the fourth quarter of 2016, the parties reached a settlement concerning the distribution of insurance proceeds and all issues of liability. On March 27, 2017, the Bankruptcy Courts confirmed the dismissal of the SEM Chapter 11 case. As part of the bankruptcy proceedings, the Company reached a settlement with claimants and recorded an accrued litigation expense of $212,500 at December 31, 2016. At September 30, 2017 and December 31, 2016 $143,400 and $212,500 was outstanding, respectively. It was agreed among the parties that all pending state and/or federal claims will be dismissed with prejudice. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2017 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 18 - SUBSEQUENT EVENTS During October 2017, the Company paid one note in full which was secured by certain assets of SEM and guaranteed by SEER and MV. |
SUMMARY OF SIGNIFICANT ACCOUN24
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The preparation of these consolidated financial statements in conformity with accounting principles generally accepted in the United States (U.S. GAAP) requires management to make a number of estimates and assumptions related to the reported amount of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the period. Significant items subject to such estimates and assumptions include the carrying amount of intangible assets; valuation allowances and reserves for receivables and inventory and deferred income taxes; revenue recognition related to contracts accounted for under the percentage of completion method; share-based compensation; and loss contingencies, including those related to litigation. Actual results could differ from those estimates. |
Reclassifications | Reclassifications Certain amounts in the prior period financial statements have been reclassified to conform to the current period presentation. These reclassifications had no effect on reported consolidated net income (loss). |
Revenue Recognition | Revenue Recognition We recognize revenue related to contract projects and services when all of the following criteria are met: (i) persuasive evidence of an agreement exists, (ii) delivery has occurred or services have been rendered, (iii) the sales price is fixed or determinable, and (iv) collectability is reasonably assured. Our revenue is primarily comprised of services related to industrial cleaning and railcar cleaning, which we recognize as services are rendered. Product revenue generated from projects, which include the manufacturing of products, for removal and treatment of hazardous vapor and gasses is accounted for under the percentage-of-completion method for projects with durations in excess of three months and the completed-contract method for all other projects. Total estimated revenue includes all of the following: (1) the basic contract price, (2) contract options, and (3) change orders. Once contract performance is underway, we may experience changes in conditions, client requirements, specifications, designs, materials and expectations regarding the period of performance. Such changes are “change orders” and may be initiated by us or by our clients. In many cases, agreement with the client as to the terms of change orders is reached prior to work commencing; however, sometimes circumstances require that work progress without obtaining client agreement. Revenue related to change orders is recognized as costs are incurred if it is probable that costs will be recovered by changing the contract price. The Company does not incur pre-contract costs. Under the percentage-of-completion method, we recognize revenue primarily based on the ratio of costs incurred to date to total estimated contract costs. Provisions for estimated losses on uncompleted contracts are recorded in the period in which the losses are identified and included as additional loss. Provisions for estimated losses on contracts are shown separately as liabilities on the balance sheet, if significant, except in circumstances in which related costs are accumulated on the balance sheet, in which case the provisions are deducted from the accumulated costs. A provision as a liability is reported as a current liability. For contracts accounted for under the percentage-of-completion method, we include in current assets and current liabilities amounts related to construction contracts realizable and payable. Costs and estimated earnings in excess of billings on uncompleted contracts represent the excess of contract costs and profits recognized to date over billings to date, and are recognized as a current asset. Billings in excess of costs and estimated earnings on uncompleted contracts represents the excess of billings to date over the amount of contract costs and profits recognized to date, and are recognized as a current liability. The Company’s revenues from waste destruction licensing agreements are recognized as a single accounting unit over the term of the license. In accordance with Accounting Standards Codification (“ASC”) 605, for revenues which contain multiple deliverables, the Company separates the deliverables into separate accounting units if they meet the following criteria: (i) the delivered items have a stand-alone value to the customer; (ii) the fair value of any undelivered items can be reliably determined; and (iii) if the arrangement includes a general right of return, delivery of the undelivered items is probable and substantially controlled by the seller. Deliverables that do not meet these criteria are combined with one or more other deliverables into one accounting unit. Revenue from each accounting unit is recognized based on the applicable accounting literature, primarily ASC 605. |
Research and Development | Research and Development Research and development (“R&D”) costs are charged to expense as incurred. R&D expenses consist primarily of salaries, project materials, contract labor and other costs associated with ongoing product development and enhancement efforts. R&D expenses were $5,400 and $149,100 for the nine months ended September 30, 2017 and 2016, respectively. |
Income Taxes | Income Taxes The Company accounts for income taxes pursuant to Accounting Standards Codification Income Taxes, ASC 740 also provides detailed guidance for the financial statement recognition, measurement and disclosure of uncertain tax positions recognized in the financial statements. Tax positions must meet a “more-likely-than-not” recognition threshold at the effective date to be recognized. During the nine months ended September 30, 2017 and 2016 the Company recognized no adjustments for uncertain tax positions. The Company recognizes interest and penalties related to uncertain tax positions in income tax expense. No interest and penalties related to uncertain tax positions were recognized at September 30, 2017 and December 31, 2016. The Company expects no material changes to unrecognized tax positions within the next twelve months. The Company has filed federal and state tax returns through December 31, 2016. The tax periods for the years ending December 31, 2010 through 2016 are open to examination by federal and state authorities. |
Recently issued accounting pronouncements | Recently issued accounting pronouncements Changes to accounting principles generally accepted in the United States of America (U.S. GAAP) are established by the Financial Accounting Standards Board (FASB) in the form of accounting standards updates (ASU’s) to the FASB’s Accounting Standards Codification. The Company considers the applicability and impact of all new or revised ASU’s. |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property plant and equipment | Property and equipment was comprised of the following: September 30, December 31, Field and shop equipment $ 2,085,000 $ 1,907,500 Vehicles 689,700 690,000 Waste destruction equipment, placed in service 927,100 1,299,500 Waste destruction equipment, not placed in service 656,200 712,100 Furniture and office equipment 322,700 319,700 Leasehold improvements 10,000 10,000 Building and improvements 21,200 21,200 Land 162,900 162,900 4,874,800 5,122,900 Less: accumulated depreciation and amortization (2,652,000 ) (2,317,800 ) Property and equipment, net $ 2,222,800 $ 2,805,100 |
Schedule of capital leased assets | Property and equipment included the following amounts for leases that have been capitalized at: September 30, December 31, Vehicles, field and shop equipment $ 318,300 $ 462,700 Less: accumulated amortization (211,500 ) (222,800 ) $ 106,800 $ 239,900 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets | Intangible assets were comprised of the following: September 30, 2017 Gross carrying amount Accumulated amortization Net carrying value Goodwill $ 277,800 $ — $ 277,800 Customer list 42,500 (42,500 ) — Technology 1,087,400 (721,200 ) 366,200 Trade name 54,900 (54,900 ) — $ 1,462,600 $ (818,600 ) $ 644,000 December 31, 2016 Gross carrying amount Accumulated amortization Net carrying value Goodwill $ 277,800 $ — $ 277,800 Customer list 42,500 (42,500 ) — Technology 1,069,500 (609,300 ) 460,200 Trade name 57,300 (57,300 ) — $ 1,447,100 $ (709,100 ) $ 738,000 |
ACCRUED LIABILITIES (Tables)
ACCRUED LIABILITIES (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Payables and Accruals [Abstract] | |
Schedule of accrued liabilities | Accrued liabilities were comprised of the following: September 30, December 31, Accrued compensation and related taxes $ 477,700 $ 644,800 Accrued interest 45,900 58,900 Accrued litigation claims 143,400 277,500 Other 576,800 399,800 Total Accrued Liabilities $ 1,243,800 $ 1,381, 000 |
UNCOMPLETED CONTRACTS (Tables)
UNCOMPLETED CONTRACTS (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Contractors [Abstract] | |
Schedule of uncompleted contracts | Costs, estimated earnings and billings on uncompleted contracts are as follows: September 30, December 31, 2017 2016 Revenue Recognized $ — $ 324,500 Less: Billings to date — (310,900 ) Costs and estimated earnings in excess of billings on uncompleted contracts $ — $ 13,600 Billings to date $ 2,669,600 $ 3,063,500 Revenue recognized (2,069,500 ) (1,972,700 ) Billings in excess of costs and estimated earnings on uncompleted contracts $ 600,100 $ 1,090,800 |
DEBT (Tables)
DEBT (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of debt | Debt as of September 30, 2017 and December 31, 2016, was comprised of the following: 2017 2016 Convertible notes payable, interest at 8% per annum, unpaid principal and interest maturing 3 years from note date between August 2018 and October 2019, convertible into common stock at the option of the lenders at a rate of $0.70 per share; one convertible note for $250,000 has a personal guarantee of an officer of the Company. 1,605,000 1,605,000 Debt discount on convertible notes (9,200 ) (14,900 ) Secured short term note payable dated October 24, 2016 with principal and interest due 60 days from issuance. The note requires a one-time fee in the amount of $10,000 to compensate for the first two weeks of the term and each week thereafter (weeks 3-8) a fee of $1,000 shall be due and owing accruing on the first day of the week. A fee of 100,000 shares of restricted common stock shall be issued as a penalty for each month or prorated for any two-week portion of any month the note is outstanding for months 3 through 6, and a fee of 200,000 shares of restricted common stock shall be issued to lender for each month or prorated for each two-week portion of any month the note is outstanding beginning in month 7 until paid in full. The note is secured by specific customer accounts receivables and a personal guarantee of an officer of the Company. This note was paid in full in April 2017. The penalty period for shares to be issued was reached and the Company issued 350,000 shares of its common stock under the terms of this agreement. The shares were valued at $245,000 recorded as interest expense. — 200,000 Secured short term note payable dated December 1, 2016 with principal and interest due 60 days from issuance. The note requires a one-time fee in the amount of $10,000 to compensate for the first two weeks of the term and each week thereafter (weeks 3-8) a fee of $1,000 shall be due and owing accruing on the first day of the week. A fee of 100,000 shares of restricted common stock shall be issued as a penalty for each month or prorated for any two-week portion of any month the note is outstanding for months 3 through 6, and a fee of 200,000 shares of restricted common stock shall be issued to lender for each month or prorated for each two-week portion of any month the note is outstanding beginning in month 7 until paid in full. The note is secured by specific customer accounts receivables and a personal guarantee of an officer of the Company. This note was paid in full in August 2017. The penalty period for shares to be issued was reached and the Company issued 800,000 shares of its common stock under the terms of this agreement. The shares were valued at $531,000 recorded as interest expense. — 200,000 Secured short term note payable dated January 23, 2017 with principal and interest due 60 days from issuance. The note requires a one-time fee in the amount of $10,000 to compensate for the first two weeks of the term and each week thereafter (weeks 3-8) a fee of $1,000 shall be due and owing accruing on the first day of the week. A fee of 100,000 shares of restricted common stock shall be issued as a penalty for each month or prorated for any two-week portion of any month the note is outstanding for months 3 through 6, and a fee of 200,000 shares of restricted common stock shall be issued to lender for each month or prorated for each two-week portion of any month the note is outstanding beginning in month 7 until paid in full. The note is secured by specific customer accounts receivables and a personal guarantee of an officer of the Company. This note was paid in full in August 2017. The penalty period for shares to be issued was reached and the Company issued 150,000 shares of its common stock under revised terms of the agreement. The shares were valued at $105,000 recorded as interest expense. No additional shares will be issued by the Company. — — Secured short term note payable dated March 30, 2017 with principal and interest due 60 days from issuance. The note requires a one-time fee in the amount of $10,000 to compensate for the first two weeks of the term and each week thereafter (weeks 3-8) a fee of $1,000 shall be due and owing accruing on the first day of the week. A fee of 100,000 shares of restricted common stock shall be issued as a penalty for each month or prorated for any two-week portion of any month the note is outstanding for months 3 through 6, and a fee of 200,000 shares of restricted common stock shall be issued to lender for each month or prorated for each two-week portion of any month the note is outstanding beginning in month 7 until paid in full. The note is secured by specific customer accounts receivables and a personal guarantee of an officer of the Company. This note was paid in full in August 2017. The penalty period for shares to be issued was reached and the Company recorded 200,000 shares of its common stock under the terms of this agreement. The shares were valued at $128,000 recorded as interest expense. Additional shares will be issued by the Company under the terms of the agreement. — — Secured short term note payable dated September 13, 2017 with principal and interest due 60 days from issuance. The note requires a one-time fee in the amount of $15,000 to compensate for the first two weeks of the term and each week thereafter (weeks 3-8) a fee of $1,500 shall be due and owing accruing on the first day of the week. A fee of 100,000 shares of restricted common stock shall be issued as a penalty for each month or prorated for any two-week portion of any month the note is outstanding for months 3 through 6, and a fee of 200,000 shares of restricted common stock shall be issued to lender for each month or prorated for each two-week portion of any month the note is outstanding beginning in month 7 until paid in full. The note is secured by the future sale of CoronaLux units and a personal guarantee of an officer of the Company. 300,000 — Note payable dated October 13, 2015, interest at 8% per annum, payable in 24 monthly installments of principal and interest $4,523, due October 1, 2017. Secured by certain assets of SEM and guaranteed by SEER and MV. This note was pad in full in October 2017. 4,500 43,600 Note payable dated October 13, 2015, interest at 8% per annum, payable in 60 monthly installments of principal and interest $4,562, due October 1, 2020. Secured by real estate and other assets of SEM and guaranteed by SEER and MV 148,700 180,000 Note payable insurance premium financing, interest at 4.25% per annum, payable in 10 installments of $44,706, due November 1, 2017 42,000 — Capital lease obligations, secured by certain assets, maturing through March 2019 49,200 109,600 Total notes payable and capital lease obligations 2,140,200 2,323,300 Less: current portion (425,000 ) (571,800 ) Notes payable and capital lease obligations, long-term, including debt discount $ 1,715,200 $ 1,751,500 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Related Party Transactions [Abstract] | |
Schedule of notes payable and accrued interest, related parties | Related parties accrued interest due to certain related parties as of September 30, 2017 and December 31, 2016 are as follows: 2017 2016 Accrued interest $ 11,800 $ 11,800 $ 11,800 $ 11,800 |
ASSETS AND LIABILITIES HELD F31
ASSETS AND LIABILITIES HELD FOR SALE AND DISCONTINUED OPERATIONS (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Assets And Liabilities Held For Sale And Discontinued Operations | |
Schedule of assets and liabilities held for sale | Assets and liabilities held for sale were comprised of the following: September, December 31, Accounts receivable, net $ — $ 841,800 Property and equipment, net — 156,200 Other — 26,600 Total Assets held for sale $ — $ 1,024,600 Accounts payable $ — $ 513,500 Accrued expenses and other — 89,600 Total Liabilities held for sale $ — $ 603,100 |
Schedule of major classes of line items constituting pretax loss on discontinued operations | Major classes of line items constituting pretax loss on discontinued operations: For the three months ending For the nine months ending 2017 2016 2017 2016 Services revenue $ 757,100 $ 877,800 $ 4,082,200 $ 2,854,100 Services costs 489,800 714,500 3,070,200 2,144,500 General and administrative expenses 23,000 35,400 117,800 118,400 Salaries and related expenses 27,700 70,400 208,900 192,300 Other (income) expense 1,200 300 (8,400 ) 1,300 Total expenses 541,700 820,600 3,388,500 2,456,500 Operating income 215,400 57,200 693,700 397,600 Income tax benefit — — — — Total income from discontinued operations $ 215,400 $ 57,200 $ 693,700 $ 397,600 |
Schedule of gain on disposal | Total gain on disposal of rail operations: September 30, Consideration from sale $ 2,400,000 Net present value of future consideration 961,500 Carrying value of net assets* (574,100 ) Gross gain on disposal 2,787,400 Additional costs on disposal Commissions (96,000 ) Accounting (18,500 ) (114,500 ) Total gain on sale of rail operations $ 2,672,900 *Carrying value of net assets Accounts receivable, net $ 1,130,500 Property and equipment, net 177,200 Other 60,200 Total Assets $ 1,367,900 Accounts payable $ 771,900 Accrued expenses and other 21,900 Total Liabilities $ 793,800 Carrying value of net assets $ 574,100 |
NET LOSS PER SHARE (Tables)
NET LOSS PER SHARE (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of potentially dilutive securities | Potentially dilutive securities were comprised of the following: Nine Months Ended 2017 2016 Warrants 8,861,441 9,664,430 Options 2,155,000 990,000 Convertible notes payable, including accrued interest 2,339,091 1,493,505 13,355,532 12,447,935 |
SEGMENT INFORMATION AND MAJOR33
SEGMENT INFORMATION AND MAJOR CUSTOMERS (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Schedule of segment information | Segment information for the three months ended September 30, 2017 and 2016 is as follows: 2017 Industrial Environmental Solid Cleaning (2) Solutions Waste Corporate Total (3) Revenue $ 413,000 $ 717,300 $ 453,100 $ — $ 1,583,400 Depreciation and amortization (1) 87,800 37,000 33,500 28,300 186,600 Interest expense 5,400 3,300 — 247,300 256,000 Stock-based compensation — — — 37,200 37,200 Net income (loss) (319,900 ) (64,700 ) (53,200 ) (940,200 ) (1,378,000 ) Capital expenditures (cash and noncash) 179,100 — — — 179,100 Total assets $ 673,400 1,749,800 $ 1,451,800 $ 1,802,900 $ 5,677,900 2016 Industrial Environmental Solid Cleaning (2) Solutions Waste Corporate Total (3) Revenue $ 167,600 $ 1,749,100 $ 41,900 $ — $ 1,958,600 Depreciation and amortization (1) 81,700 42,700 31,500 24,800 180,700 Interest expense 7,600 5,300 — 42,800 55,700 Stock-based compensation — — — 10,900 10,900 Net income (loss) (558,700 ) 217,000 (197,800 ) (391,500 ) (931,000 ) Capital expenditures (cash and noncash) 6,300 — 5,200 — 11,500 Total assets $ 1,118,300 $ 2,349,300 $ 2,914,500 $ 1,083,100 $ 7,465,200 Segment information for the nine months ended September 30, 2017 and 2016 is as follows: 2017 Industrial Environmental Solid Cleaning (2) Solutions Waste Corporate Total (3) Revenue $ 1,803,000 $ 4,268,800 $ 596,900 $ — $ 6,668,700 Depreciation and amortization (1) 257,700 153,400 108,700 75,500 595,300 Interest expense 17,800 12,300 100 1,182,300 1,212,500 Stock-based compensation — — — 94,000 94,000 Net income (loss) (789,100 ) 395,700 (252,100 ) (2,967,400 ) (3,612,900 ) Capital expenditures (cash and noncash) 239,500 1,300 — — 240,800 Total assets $ 673,400 1,749,800 $ 1,451,800 $ 1,802,900 $ 5,677,900 2016 Industrial Environmental Solid Cleaning (2) Solutions Waste Corporate Total (3) Revenue $ 2,423,800 $ 3,454,500 $ 170,100 $ — $ 6,048,400 Depreciation and amortization (1) 251,100 125,500 96,300 98,000 570,900 Interest expense 25,100 17,500 500 212,100 255,200 Stock-based compensation — — — 84,000 84,000 Net income (loss) 88,500 91,000 (303,400 ) (1,022,500 ) (1,146,400 ) Capital expenditures (cash and noncash) 129,400 12,900 12,100 — 154,400 Total assets $ 1,118,300 $ 2,349,300 $ 2,914,500 $ 1,083,100 $ 7,465,200 (1) Includes depreciation of property, equipment and leasehold improvement and amortization of intangibles. (2) Includes mobile rail car cleaning and excludes locations classified as discontinued operations. (3) Excludes discontinued operations. |
ORGANIZATION AND FINANCIAL CO34
ORGANIZATION AND FINANCIAL CONDITION (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | ||
Accumulated deficit | $ (19,404,700) | $ (19,404,700) | $ (19,273,500) | [1] | ||
Net loss from continuing operations | (1,378,000) | $ (931,000) | (3,612,900) | $ (2,093,100) | ||
Net income (losses) before adjustment for losses attributable to non-controlling interest | 1,510,300 | $ (873,800) | (246,300) | $ (1,695,500) | (4,700,000) | |
Working capital | $ 2,900,000 | 2,900,000 | 4,000,000 | |||
Change in working capital | $ (1,100,000) | |||||
Paragon Waste Solutions, LLC [Member] | ||||||
Percentage ownership | 54.00% | 54.00% | ||||
ReaCH4Biogas [Member] | ||||||
Percentage ownership | 85.00% | 85.00% | ||||
Resource Environmental Group Services [Member] | Sales Revenue [Member] | ||||||
Reduction in revenue | $ 2,500,000 | |||||
[1] | These numbers were derived from the audited financial statements for the year ended December 31, 2016. See accompanying notes. |
SUMMARY OF SIGNIFICANT ACCOUN35
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Accounting Policies [Abstract] | ||
Research and development expenses | $ 5,400 | $ 149,100 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 | |
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | $ 4,874,800 | $ 5,122,900 | |
Less: accumulated depreciation and amortization | (2,652,000) | (2,317,800) | |
Property and equipment, net | 2,222,800 | 2,805,100 | [1] |
Field and Shop Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 2,085,000 | 1,907,500 | |
Vehicles [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 689,700 | 690,000 | |
Waste Destruction Equipment Placed In Service [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 927,100 | 1,299,500 | |
Waste Destruction Equipment, Not Placed In Service [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 656,200 | 712,100 | |
Furniture And Office Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 322,700 | 319,700 | |
Leasehold Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 10,000 | 10,000 | |
Building and Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 21,200 | 21,200 | |
Land [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | $ 162,900 | $ 162,900 | |
[1] | These numbers were derived from the audited financial statements for the year ended December 31, 2016. See accompanying notes. |
PROPERTY AND EQUIPMENT (Detai37
PROPERTY AND EQUIPMENT (Details 1) - Field and Shop Equipment [Member] - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 |
Property, Plant and Equipment [Line Items] | ||
Vehicles, field and shop equipment | $ 318,300 | $ 462,700 |
Less: accumulated amortization | (211,500) | (222,800) |
Capital lease, net | $ 106,800 | $ 239,900 |
PROPERTY AND EQUIPMENT (Detai38
PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Depreciation expense | $ 165,900 | $ 165,600 | $ 485,800 | $ 502,600 |
CoronaLux Units [Member] | ||||
Accumulated depreciation | 422,500 | 271,700 | 422,500 | 271,700 |
Cost of Goods Sold [Member] | ||||
Depreciation expense | 136,600 | 132,800 | 407,500 | 430,100 |
Selling, General And Administrative Expense [Member] | ||||
Depreciation expense | $ 29,300 | $ 29,300 | $ 78,300 | $ 72,500 |
INTANGIBLE ASSETS (Details)
INTANGIBLE ASSETS (Details) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 | |
Finite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount | $ 1,462,600 | $ 1,447,100 | |
Accumulated amortization | (818,600) | (709,100) | |
Net carrying value | 644,000 | 738,000 | [1] |
Goodwill [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount | 277,800 | 277,800 | |
Net carrying value | 277,800 | 277,800 | |
Customer List [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount | 42,500 | 42,500 | |
Accumulated amortization | (42,500) | (42,500) | |
Technology [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount | 1,087,400 | 1,069,500 | |
Accumulated amortization | (721,200) | (609,300) | |
Net carrying value | 366,200 | 460,200 | |
Trade Name [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount | 54,900 | 57,300 | |
Accumulated amortization | $ (54,900) | $ (57,300) | |
[1] | These numbers were derived from the audited financial statements for the year ended December 31, 2016. See accompanying notes. |
INTANGIBLE ASSETS (Details Narr
INTANGIBLE ASSETS (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Amortization expense | $ 24,400 | $ 25,200 | $ 109,500 | $ 68,200 |
Lower Range [Member] | ||||
Estimated useful lives of intangible assets | 7 years | |||
Upper Range [Member] | ||||
Estimated useful lives of intangible assets | 10 years |
ACCRUED LIABILITIES (Details)
ACCRUED LIABILITIES (Details) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 |
Payables and Accruals [Abstract] | ||
Accrued compensation and related taxes | $ 477,700 | $ 644,800 |
Accrued interest | 45,900 | 58,900 |
Accrued litigation claims | 143,400 | 277,500 |
Other | 576,800 | 399,800 |
Total Accrued Liabilities | $ 1,243,800 | $ 1,381,000 |
UNCOMPLETED CONTRACTS (Details)
UNCOMPLETED CONTRACTS (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Sep. 30, 2017 | ||
Less: Billings to date | $ 3,063,500 | $ 2,669,600 | |
Costs and estimated earnings in excess of billings on uncompleted contracts | [1] | 13,600 | |
Revenue recognized | (1,972,700) | (2,069,500) | |
Billings in excess of costs and estimated earnings on uncompleted contracts | 1,090,800 | $ 600,100 | |
Contracts Receivable [Member] | |||
Revenue Recognized | 324,500 | ||
Less: Billings to date | $ (310,900) | ||
[1] | These numbers were derived from the audited financial statements for the year ended December 31, 2016. See accompanying notes. |
INVESTMENT IN PARAGON WASTE S43
INVESTMENT IN PARAGON WASTE SOLUTIONS LLC (Details Narrative) - USD ($) | Nov. 17, 2014 | Jun. 10, 2014 | Mar. 04, 2014 | Feb. 22, 2014 | Feb. 28, 2015 | Jun. 30, 2012 | Aug. 31, 2011 | Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2014 | Dec. 31, 2010 | Sep. 30, 2017 | |
Business Acquisition [Line Items] | ||||||||||||||||
License initiation fee | $ 453,100 | $ 41,900 | $ 596,900 | $ 170,000 | ||||||||||||
Customer deposits | [1] | $ 330,000 | ||||||||||||||
Formation of Joint Venture Agreement [Member] | Ordinary A Voting Shares [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Membership units issued | 100 | |||||||||||||||
Formation of Joint Venture Agreement [Member] | Ordinary B Non-Voting Shares [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Membership units issued | 300,000 | |||||||||||||||
Exclusive Use License and Joint Operations Agreement with Sterall Inc [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Non-refundable placement fees received | $ 236,300 | |||||||||||||||
Customer deposits | $ 330,000 | |||||||||||||||
Description of order | Sterall also has paid a deposit of $330,000 for the five units ordered and a balance of $851,500 is still owed and has been fully reserved by the Company. | |||||||||||||||
Accounts receivable | $ 851,500 | $ 851,500 | $ 851,500 | |||||||||||||
Exclusive Use License and Equipment Lease Agreement with eCycling International [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
License initiation fee | $ 176,875 | |||||||||||||||
Percentage of net operating profits to be distributed | 50.00% | |||||||||||||||
Licensing fees paid | 176,875 | |||||||||||||||
Additional licensing fees paid | $ 176,875 | |||||||||||||||
Exclusive Use License and Equipment Lease Agreement with Medical Waste Services, LLC [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
License initiation fee | $ 225,000 | |||||||||||||||
Percentage of net operating profits to be distributed | 50.00% | |||||||||||||||
Outside Third Party [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Percentage ownership | 10.00% | 10.00% | 10.00% | 10.00% | ||||||||||||
Daniel McAteer & Associates ("DMA") [Member] | Formation of Joint Venture Agreement [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Percentage ownership | 50.00% | |||||||||||||||
License initiation fee | $ 350,000 | |||||||||||||||
Paragon Waste (UK) Ltd [Member] | Formation of Joint Venture Agreement [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Membership units issued | 300,100 | |||||||||||||||
Accounts receivable | $ 176,000 | $ 176,000 | $ 176,000 | |||||||||||||
Paragon Waste (UK) Ltd [Member] | Formation of Joint Venture Agreement [Member] | Ordinary A Voting Shares [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Membership units issued | 50 | |||||||||||||||
Black Stone Management Services [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Membership units acquired | 400,000 | |||||||||||||||
Percentage ownership | 26.00% | 26.00% | 26.00% | 26.00% | ||||||||||||
Percentage allocated to two individuals | 10.00% | |||||||||||||||
Stock issued for acquisition of intellectual property | $ 100,000 | |||||||||||||||
Stock issued for acquisition of intellectual property (in shares) | 1,000,000 | |||||||||||||||
Black Stone Management Services [Member] | Waste Destruction Technology [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Useful life | 10 years | |||||||||||||||
Related Parties [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Percentage ownership | 5.00% | 5.00% | 5.00% | 5.00% | ||||||||||||
Xinhua Energy Environmental Technology [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Sale of waste destruction unit | $ 430,500 | |||||||||||||||
Second phase royalty fees payment | $ 350,000 | |||||||||||||||
Percentage of net operating profits to be distributed | 50.00% | |||||||||||||||
Paragon Waste Solutions, LLC [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Membership units issued | 1,000,000 | |||||||||||||||
Membership units acquired | 600,000 | |||||||||||||||
Percentage ownership | 54.00% | 54.00% | 54.00% | 54.00% | ||||||||||||
Payment for funding of subsidiary | $ 6,000,000 | |||||||||||||||
[1] | These numbers were derived from the audited financial statements for the year ended December 31, 2016. See accompanying notes. |
PAYROLL TAXES PAYABLE (Details
PAYROLL TAXES PAYABLE (Details Narrative) - IRS [Member] - USD ($) | 1 Months Ended | ||
May 31, 2013 | Sep. 30, 2017 | Dec. 31, 2016 | |
Past due payroll taxes | $ 992,000 | $ 993,300 | |
Monthly installment payments, payroll taxes | $ 25,000 |
DEBT (Details)
DEBT (Details) | 9 Months Ended | ||
Sep. 30, 2017USD ($)Segment$ / sharesshares | Dec. 31, 2016USD ($) | ||
Debt Instrument [Line Items] | |||
Total notes payable and capital lease obligations | $ 2,140,200 | $ 2,323,300 | |
Less: current portion | (425,000) | (571,800) | [1] |
Notes payable and capital lease obligations, long-term, including debt discount | $ 1,715,200 | 1,751,500 | [1] |
Shares issuable per short-term note agreements | shares | 700,000 | ||
October 24, 2016 Short Term Note Payable [Member] | |||
Debt Instrument [Line Items] | |||
Debt issuance date | Oct. 24, 2016 | ||
Long term debt, carrying amount | 200,000 | ||
Debt term | 60 days | ||
One-time commitment fee | $ 10,000 | ||
Recurring commitment fees | $ 1,000 | ||
Description of commitment fees | The note requires a one-time fee in the amount of $10,000 to compensate for the first two weeks of the term and each week thereafter (weeks 3-8) a fee of $1,000 shall be due and owing accruing on the first day of the week. | ||
Collateral description | The note is secured by specific customer accounts receivables and a personal guarantee of an officer of the Company. | ||
Description of debt penalty | A fee of 100,000 shares of restricted common stock shall be issued as a penalty for each month or prorated for any two-week portion of any month the note is outstanding for months 3 through 6, and a fee of 200,000 shares of restricted common stock shall be issued to lender for each month or prorated for each two-week portion of any month the note is outstanding beginning in month 7 until paid in full. | ||
Shares to be issued per month if note outstanding months 3 through 6 | shares | 100,000 | ||
Shares to be issued per month if notes outsatnding 7 months or longer | shares | 200,000 | ||
Shares issuable per short-term note agreements | shares | 350,000 | ||
Interest expense - debt | $ 245,000 | ||
Short Term Note Payable December 2016 [Member] | |||
Debt Instrument [Line Items] | |||
Debt issuance date | Dec. 1, 2016 | ||
Long term debt, carrying amount | 200,000 | ||
Debt term | 60 days | ||
One-time commitment fee | $ 10,000 | ||
Recurring commitment fees | $ 1,000 | ||
Description of commitment fees | The note requires a one-time fee in the amount of $10,000 to compensate for the first two weeks of the term and each week thereafter (weeks 3-8) a fee of $1,000 shall be due and owing accruing on the first day of the week. | ||
Collateral description | The note is secured by specific customer accounts receivables and a personal guarantee of an officer of the Company. | ||
Description of debt penalty | A fee of 100,000 shares of restricted common stock shall be issued as a penalty for each month or prorated for any two-week portion of any month the note is outstanding for months 3 through 6, and a fee of 200,000 shares of restricted common stock shall be issued to lender for each month or prorated for each two-week portion of any month the note is outstanding beginning in month 7 until paid in full. | ||
Shares to be issued per month if note outstanding months 3 through 6 | shares | 100,000 | ||
Shares to be issued per month if notes outsatnding 7 months or longer | shares | 200,000 | ||
Shares issuable per short-term note agreements | shares | 800,000 | ||
Interest expense - debt | $ 531,000 | ||
Short Term Note Payable January 23, 2017 [Member] | |||
Debt Instrument [Line Items] | |||
Debt issuance date | Jan. 23, 2017 | ||
Debt term | 60 days | ||
One-time commitment fee | $ 10,000 | ||
Recurring commitment fees | $ 1,000 | ||
Description of commitment fees | The note requires a one-time fee in the amount of $10,000 to compensate for the first two weeks of the term and each week thereafter (weeks 3-8) a fee of $1,000 shall be due and owing accruing on the first day of the week. | ||
Collateral description | The note is secured by specific customer accounts receivables and a personal guarantee of an officer of the Company. | ||
Description of debt penalty | A fee of 100,000 shares of restricted common stock shall be issued as a penalty for each month or prorated for any two-week portion of any month the note is outstanding for months 3 through 6, and a fee of 200,000 shares of restricted common stock shall be issued to lender for each month or prorated for each two-week portion of any month the note is outstanding beginning in month 7 until paid in full. | ||
Shares to be issued per month if note outstanding months 3 through 6 | shares | 100,000 | ||
Shares to be issued per month if notes outsatnding 7 months or longer | shares | 200,000 | ||
Shares issuable per short-term note agreements | shares | 150,000 | ||
Interest expense - debt | $ 105,000 | ||
Short Term Note Payable March 30, 2017 [Member] | |||
Debt Instrument [Line Items] | |||
Debt issuance date | Mar. 30, 2017 | ||
Debt term | 60 days | ||
One-time commitment fee | $ 10,000 | ||
Recurring commitment fees | $ 1,000 | ||
Description of commitment fees | The note requires a one-time fee in the amount of $10,000 to compensate for the first two weeks of the term and each week thereafter (weeks 3-8) a fee of $1,000 shall be due and owing accruing on the first day of the week. | ||
Collateral description | The note is secured by specific customer accounts receivables and a personal guarantee of an officer of the Company. | ||
Description of debt penalty | A fee of 100,000 shares of restricted common stock shall be issued as a penalty for each month or prorated for any two-week portion of any month the note is outstanding for months 3 through 6, and a fee of 200,000 shares of restricted common stock shall be issued to lender for each month or prorated for each two-week portion of any month the note is outstanding beginning in month 7 until paid in full. | ||
Shares to be issued per month if note outstanding months 3 through 6 | shares | 100,000 | ||
Shares to be issued per month if notes outsatnding 7 months or longer | shares | 200,000 | ||
Shares issuable per short-term note agreements | shares | 200,000 | ||
Interest expense - debt | $ 128,000 | ||
Short Term Note Payable September 13, 2017 [Member] | |||
Debt Instrument [Line Items] | |||
Debt issuance date | Sep. 13, 2017 | ||
Long term debt, carrying amount | $ 300,000 | ||
Debt term | 60 days | ||
One-time commitment fee | $ 15,000 | ||
Recurring commitment fees | $ 1,500 | ||
Description of commitment fees | The note requires a one-time fee in the amount of $15,000 to compensate for the first two weeks of the term and each week thereafter (weeks 3-8) a fee of $1,500 shall be due and owing accruing on the first day of the week. | ||
Collateral description | The note is secured by the future sale of CoronaLux units and a personal guarantee of an officer of the Company. | ||
Description of debt penalty | A fee of 100,000 shares of restricted common stock shall be issued as a penalty for each month or prorated for any two-week portion of any month the note is outstanding for months 3 through 6, and a fee of 200,000 shares of restricted common stock shall be issued to lender for each month or prorated for each two-week portion of any month the note is outstanding beginning in month 7 until paid in full. | ||
Shares to be issued per month if note outstanding months 3 through 6 | shares | 100,000 | ||
Shares to be issued per month if notes outsatnding 7 months or longer | shares | 200,000 | ||
Interest expense - debt | $ 128,000 | ||
8% Convertible Secured Promissory Note due August 2018 and October 2019 [Member] | |||
Debt Instrument [Line Items] | |||
Long term debt, carrying amount | $ 1,605,000 | 1,605,000 | |
Interest rate | 8.00% | ||
Debt term | 3 years | ||
Debt discount | $ (9,200) | (14,900) | |
Debt conversion, price | $ / shares | $ 0.70 | ||
Collateral description | one convertible note for $250,000 has a personal guarantee of an officer of the Company | ||
8% Convertible Secured Promissory Note due August 2018 and October 2019 [Member] | Lower Range [Member] | |||
Debt Instrument [Line Items] | |||
Debt, maturity date | Aug. 1, 2018 | ||
8% Convertible Secured Promissory Note due August 2018 and October 2019 [Member] | Upper Range [Member] | |||
Debt Instrument [Line Items] | |||
Debt, maturity date | Oct. 31, 2019 | ||
8% Secured Notes Payable Due October 1, 2017 [Member] | |||
Debt Instrument [Line Items] | |||
Debt issuance date | Oct. 13, 2015 | ||
Long term debt, carrying amount | $ 4,500 | 43,600 | |
Interest rate | 8.00% | ||
Frequency of payments | Monthly | ||
Payment amount | $ 4,523 | ||
Number of installment payments | Segment | 24 | ||
Debt term | 24 months | ||
Debt, maturity date | Oct. 1, 2017 | ||
Collateral description | Secured by certain assets of SEM and guaranteed by SEER and MV | ||
8% Secured Notes Payable Due October 1, 2020 [Member] | |||
Debt Instrument [Line Items] | |||
Debt issuance date | Oct. 13, 2015 | ||
Long term debt, carrying amount | $ 148,700 | 180,000 | |
Interest rate | 8.00% | ||
Frequency of payments | Monthly | ||
Payment amount | $ 4,562 | ||
Number of installment payments | Segment | 60 | ||
Debt term | 60 months | ||
Debt, maturity date | Oct. 1, 2020 | ||
Collateral description | Secured by real estate and other assets of SEM and guaranteed by SEER and MV | ||
Notes Payable Due November 1, 2017 [Member] | |||
Debt Instrument [Line Items] | |||
Long term debt, carrying amount | $ 42,000 | ||
Interest rate | 4.25% | ||
Description of debt instrument interest payment | 44,706 | ||
Number of installment payments | Segment | 10 | ||
Debt, maturity date | Nov. 1, 2017 | ||
Capital lease obligations [Member] | |||
Debt Instrument [Line Items] | |||
Capital lease obligation, carrying amount | $ 49,200 | $ 109,600 | |
[1] | These numbers were derived from the audited financial statements for the year ended December 31, 2016. See accompanying notes. |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 | |
Related Party Transaction [Line Items] | |||
Accrued interest | $ 1,243,800 | $ 1,381,000 | [1] |
Related Parties [Member] | |||
Related Party Transaction [Line Items] | |||
Accrued interest | $ 11,800 | $ 11,800 | |
[1] | These numbers were derived from the audited financial statements for the year ended December 31, 2016. See accompanying notes. |
RELATED PARTY TRANSACTIONS (D47
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | 1 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Sep. 30, 2014 | Aug. 30, 2014 | Mar. 31, 2012 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | |
Related Party Transaction [Line Items] | |||||||
Common stock, issued | 56,338,575 | 54,525,079 | |||||
Common stock, outstanding | 56,338,575 | 54,525,079 | |||||
Income from joint venture | $ 15,700 | ||||||
Paragon Waste Solutions, LLC [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Percentage ownership | 54.00% | ||||||
Income from joint venture | $ 19,000 | $ 15,700 | |||||
Percentage of net income in joint venture | 50.00% | ||||||
Cost incurred for joint venture | $ 57,000 | 68,000 | |||||
Paragon Waste Solutions, LLC [Member] | Irrevocable License & Royalty Agreement [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Percentage of royalty revenue | 5.00% | ||||||
Irrevocable License & Royalty Agreement with PWS [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Related party revenues | 127,900 | 205,000 | |||||
Royalties due | $ 23,600 | 17,200 | |||||
New Technologies Agreement with Black Stone [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Issuance of common stock for intangible assets | $ 1,050,000 | ||||||
Number of shares of common stock issued for intangible asset | 1,000,000 | ||||||
Equity Agreement With Third Party [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Issuance of common stock for investment in unconsolidated subsidaiary | $ 1,212,000 | ||||||
Membership interests acquired | 22.5 | ||||||
Number of shares issued for investment in unconsolidated affiliate | 1,200,000 | ||||||
Common stock, fair value (in dollars per shares) | $ 0.83333 | ||||||
Percentage ownership | 15.00% | ||||||
Common stock, issued | 1,200,000 | ||||||
Common stock, outstanding | 1,200,000 | ||||||
Sterall equipment deposits | $ 330,000 |
ASSETS AND LIABILITIES HELD F48
ASSETS AND LIABILITIES HELD FOR SALE AND DISCONTINUED OPERATIONS (Details) | Dec. 31, 2016USD ($) | |
Total Assets held for sale | $ 1,024,600 | [1] |
Total Liabilities held for sale | 603,100 | [1] |
Accounts Payable [Member] | ||
Total Liabilities held for sale | 513,500 | |
Accrued Expenses and Other [Member] | ||
Total Liabilities held for sale | 89,600 | |
Property and Equipment [Member] | ||
Total Assets held for sale | 156,200 | |
Other [Member] | ||
Total Assets held for sale | 26,600 | |
Accounts Receivable [Member] | ||
Total Assets held for sale | $ 841,800 | |
[1] | These numbers were derived from the audited financial statements for the year ended December 31, 2016. See accompanying notes. |
ASSETS AND LIABILITIES HELD F49
ASSETS AND LIABILITIES HELD FOR SALE AND DISCONTINUED OPERATIONS (Details 1) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Assets And Liabilities Held For Sale And Discontinued Operations | ||||
Services revenue | $ 757,100 | $ 877,800 | $ 4,082,200 | $ 2,854,100 |
Services costs | 489,800 | 714,500 | 3,070,200 | 2,144,500 |
General and administrative expenses | 23,000 | 35,400 | 117,800 | 118,400 |
Salaries and related expenses | 27,700 | 70,400 | 208,900 | 192,300 |
Other (income) expense | 1,200 | 300 | (8,400) | 1,300 |
Total expenses | 541,700 | 820,600 | 3,388,500 | 2,456,500 |
Operating income | 215,400 | 57,200 | 693,700 | 397,600 |
Total income from discontinued operations | $ 215,400 | $ 57,200 | $ 693,700 | $ 397,600 |
ASSETS AND LIABILITIES HELD F50
ASSETS AND LIABILITIES HELD FOR SALE AND DISCONTINUED OPERATIONS (Details 2) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2017 | Dec. 31, 2016 | ||
Additional costs on disposal | ||||
Total gain on sale of rail operations | $ 2,672,900 | $ 2,672,900 | ||
Total Liabilities | [1] | $ 603,100 | ||
Railcar Cleaning [Member] | ||||
Consideration from sale | 2,400,000 | |||
Net present value of future consideration | 961,500 | |||
Carrying value of net assets | (574,100) | |||
Gross gain on disposal | 2,787,400 | |||
Additional costs on disposal | ||||
Commission | (96,000) | |||
Accounting | (18,500) | |||
[custom:TotalCostsOfDisposalSaleOfDisposalGroup] | (114,500) | |||
Total gain on sale of rail operations | 2,672,900 | |||
Accounts receivable, net | 1,130,500 | 1,130,500 | ||
Property and equipment, net | 177,200 | 177,200 | ||
Other | 60,200 | 60,200 | ||
Total Assets | 1,367,900 | 1,367,900 | ||
Accounts payable | 771,900 | 771,900 | ||
Accrued expenses and other | 21,900 | 21,900 | ||
Total Liabilities | 793,800 | 793,800 | ||
Carrying value of net assets | $ 574,100 | $ 574,100 | ||
[1] | These numbers were derived from the audited financial statements for the year ended December 31, 2016. See accompanying notes. |
ASSETS AND LIABILITIES HELD F51
ASSETS AND LIABILITIES HELD FOR SALE AND DISCONTINUED OPERATIONS (Details Narrative) - Railcar Cleaning [Member] | 3 Months Ended |
Sep. 30, 2017USD ($) | |
Proceeds from sale of railcar cleaning division | $ 2,400,000 |
Proceeds of guaranteed payments from sale of assets | $ 1,100,000 |
Term for guaranteed payments received (in years) | 3 years |
Performance based payment received | $ 1,500,000 |
EQUITY TRANSACTIONS (Details Na
EQUITY TRANSACTIONS (Details Narrative) - USD ($) | 1 Months Ended | 9 Months Ended | |||
Sep. 30, 2016 | May 31, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Warrants issued during period | 200,000 | ||||
Warrant exercise price | $ 0.70 | ||||
Warrant term | 5 years | ||||
Value of warrants issued | $ 31,300 | ||||
Shares issued during period in connection with settelement agreement | 300,000 | ||||
Shares issued during period in connection with settelement agreement, shares | $ 174,000 | ||||
Common stock, par value (in dollars per shares) | $ 0.001 | $ 0.001 | |||
Shares issued during payment in connection with the late payment penalty | 300,000 | ||||
Shares issued during payment in connection with the late payment penalty, value | $ 189,000 | ||||
Shares issuable per short-term note agreements | 700,000 | ||||
Shares issuable per short-term note agreements, value | $ 475,000 | ||||
Shares issued in cashless exercise | 13,496 | ||||
Options issued | 60,000 | ||||
Exercise price of options issued | $ 0.60 | ||||
Number of warrants extended | 2,966,191 | ||||
Warrant extension fee | $ 160,760 | ||||
Proceeds from warrant extension fee | 148,500 | ||||
Outstanding warrant extension fees due | 12,260 | ||||
Stock based compensation expesne for warrant extensions | $ 83,677 | ||||
Shares issued under common stock subscription | 100,000 | ||||
Shares issued under common stock subscription, value | $ 25,000 | ||||
Proceeds from warrant exercises | 25,000 | ||||
Proceeds from convertible debt | $ 250,000 | ||||
Shares debt can be converted into | 357,142 | ||||
Equity Agreement With Third Party [Member] | |||||
Number of shares issued during the period | 1,200,000 | ||||
Value of shares issued during the period | $ 720,000 | ||||
Paragon Waste Solutions, LLC [Member] | |||||
Non-controlling Interest | 46.00% | ||||
Warrants [Member] | |||||
Warrants issued during period | 50,000 | 500,000 | |||
Warrant exercise price | $ 0.85 | $ 0.50 | $ 0.85 | ||
Warrant term | 5 years | 4 years | |||
Value of warrants issued | $ 4,900 | ||||
Common stock, par value (in dollars per shares) | $ 0.001 | $ 0.001 | |||
Shares issued on warrant exercise | 250,000 | ||||
Proceeds from warrant exercises | $ 125,000 | ||||
2016 Private Placement [Member] | |||||
Number of shares issued during the period | 600,000 | ||||
Value of shares issued during the period | $ 300,000 | ||||
Price per share sold | $ 0.50 | $ 0.50 | |||
Proceeds from stock issuance | $ 400,000 | ||||
Stock Options [Member] | |||||
Shares issued in cashless exercise | 166,666 | ||||
Stock Options [Member] | Richard Robertson [Member] | |||||
Options issued | 1,000,000 | ||||
Exercise price of options issued | $ 1 | ||||
Vesting terms of options | 100,000 shares vested immediately and the remaining 900,000 options vest over a period of four years in a series of 16 successive equal quarterly installments of 56,250 commencing March 31, 2017 and ending December 31, 2020. | ||||
Shares vested on issuance of option | 100,000 | ||||
Vesting period of options | 4 years | ||||
Fair value of options at grant date | $ 102,354 | ||||
Risk-free interest rate | 1.89% | ||||
Expected volatility | 36.87% | ||||
Expected life | 5 years 6 months | ||||
Dividend rate | 0.00% | ||||
Stock Options [Member] | Donald F. Moorehead [Member] | |||||
Options issued | 1,000,000 | ||||
Exercise price of options issued | $ 0.70 | ||||
Vesting terms of options | The options vest over a period of two years in a series of 8 successive equal quarterly installments of 125,000 commencing July 1, 2017 and ending April 1, 2019. | ||||
Vesting period of options | 2 years | ||||
Fair value of options at grant date | $ 231,514 | ||||
Risk-free interest rate | 1.84% | ||||
Expected volatility | 39.17% | ||||
Expected life | 4 years 6 months | ||||
Dividend rate | 0.00% | ||||
Short Term Notes [Member] | |||||
Shares issued during payment in connection with the late payment penalty | 500,000 | ||||
Shares issued during payment in connection with the late payment penalty, value | $ 345,000 |
CUSTOMER CONCENTRATIONS (Detail
CUSTOMER CONCENTRATIONS (Details Narrative) - Sales [Member] - Segment | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2016 | |
Number of customers | 1 | 2 | 1 |
Concentration risk | 17.00% | 3800.00% | 22.00% |
NET LOSS PER SHARE (Details)
NET LOSS PER SHARE (Details) - shares | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive securities | 13,355,532 | 12,447,935 |
Convertible Notes Payable [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive securities | 2,339,091 | 1,493,505 |
Stock Options [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive securities | 2,155,000 | 990,000 |
Warrants [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive securities | 8,861,441 | 9,664,430 |
SEGMENT INFORMATION AND MAJOR55
SEGMENT INFORMATION AND MAJOR CUSTOMERS (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | ||||
Segment Reporting Information [Line Items] | |||||||
Revenue | [1] | $ 1,583,400 | $ 1,958,600 | $ 6,668,700 | $ 6,048,300 | ||
Depreciation and amortization | [1],[2] | 186,600 | 180,700 | 595,300 | 570,900 | ||
Interest expense | [1] | 256,000 | 55,700 | 1,212,500 | 255,200 | ||
Stock-based compensation | [1] | 37,200 | 10,900 | 94,000 | 84,000 | [2] | |
Net income (loss) | [1] | (1,378,000) | (931,000) | (3,612,900) | (1,146,400) | [2] | |
Capital expenditures (cash and noncash) | [1] | 179,100 | 11,500 | 240,800 | 154,400 | [2] | |
Total assets | [1] | 5,677,900 | 7,465,200 | [2] | 5,677,900 | 7,465,200 | [2] |
Industrial Cleaning [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | [3] | 413,000 | 167,600 | 1,803,000 | 2,423,800 | ||
Depreciation and amortization | [2],[3] | 87,800 | 81,700 | 257,700 | 251,100 | ||
Interest expense | [3] | 5,400 | 7,600 | 17,800 | 25,100 | ||
Net income (loss) | [3] | (319,900) | (558,700) | (789,100) | 88,500 | ||
Capital expenditures (cash and noncash) | [3] | 179,100 | 6,300 | 239,500 | 129,400 | ||
Total assets | [3] | 673,400 | 1,118,300 | 673,400 | 1,118,300 | ||
Environmental Solutions [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | 717,300 | 1,749,100 | 4,268,800 | 3,454,500 | |||
Depreciation and amortization | [2] | 37,000 | 42,700 | 153,400 | 125,500 | ||
Interest expense | 3,300 | 5,300 | 12,300 | 17,500 | |||
Net income (loss) | (64,700) | 217,000 | 395,700 | 91,000 | |||
Capital expenditures (cash and noncash) | 1,300 | 12,900 | |||||
Total assets | 1,749,800 | 2,349,300 | 1,749,800 | 2,349,300 | |||
Solid Waste [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenue | 453,100 | 41,900 | 596,900 | 170,100 | |||
Depreciation and amortization | [2] | 33,500 | 31,500 | 180,700 | 96,300 | ||
Interest expense | 100 | 500 | |||||
Net income (loss) | (53,200) | (197,800) | (252,100) | (303,400) | |||
Capital expenditures (cash and noncash) | 5,200 | 12,100 | |||||
Total assets | 1,451,800 | 2,914,500 | 1,451,800 | 2,914,500 | |||
Corporate [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Depreciation and amortization | [2] | 28,300 | 24,800 | 75,500 | 98,000 | ||
Interest expense | 247,300 | 42,800 | 1,182,300 | 212,100 | |||
Stock-based compensation | 37,200 | 10,900 | 94,000 | 84,000 | |||
Net income (loss) | (940,200) | (391,500) | (2,967,400) | (1,022,500) | |||
Total assets | $ 1,802,900 | $ 1,083,100 | $ 1,802,900 | $ 1,083,100 | |||
[1] | Excludes discontinued operations | ||||||
[2] | Includes depreciation of property, equipment and leasehold improvement and amortization of intangibles | ||||||
[3] | Includes mobile rail car cleaning and excludes locations classified as discontinued operations |
SEGMENT INFORMATION AND MAJOR56
SEGMENT INFORMATION AND MAJOR CUSTOMERS (Details Narrative) | 9 Months Ended |
Sep. 30, 2017Segment | |
Segment Reporting [Abstract] | |
Number of segments | 3 |
LITIGATION (Details Narrative)
LITIGATION (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | |||
Dec. 31, 2016 | Jun. 30, 2016 | Jan. 31, 2016 | Dec. 31, 2016 | Sep. 30, 2017 | |
Loss Contingencies [Line Items] | |||||
Accrued litigation claims | $ 277,500 | $ 277,500 | $ 143,400 | ||
Litigation Case - Property Leased [Member] | |||||
Loss Contingencies [Line Items] | |||||
Lease expiration date | Feb. 29, 2016 | ||||
Damages sought value | $ 97,000 | ||||
Settlement amount | 65,000 | ||||
Settlement payable | 39,000 | 39,000 | 0 | ||
Description of allegation | certain claims including property damage, and loss of rents, attorney fees and other costs | ||||
Description of settlement | In December 2016, the Company and the lessor reached a settlement of $65,000. | ||||
Name of plaintiff | Landlord | ||||
Name of defendant | REGS, a subsidiary of the Company. | ||||
Accrued litigation expense | 212,500 | ||||
Litigation Case - Vehicle Accident [Member] | |||||
Loss Contingencies [Line Items] | |||||
Settlement payable | $ 212,500 | $ 212,500 | $ 143,400 | ||
Description of allegation | an employee of SEM was involved in a vehicle accident while on Company business. Various actions were filed by the claimants in both state and federal courts. | ||||
Description of settlement | In the fourth quarter of 2016, the parties reached a settlement concerning the distribution of insurance proceeds and all issues of liability. |