Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2020 | Nov. 09, 2020 | |
Cover [Abstract] | ||
Entity Registrant Name | Ameramex International Inc | |
Entity Central Index Key | 0001776048 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2020 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 000-56054 | |
Entity Incorporation State Code | NV | |
Title of 12(b) Security | Common Stock | |
Trading Symbol | AMMX | |
Entity Reporting Status Current | Yes | |
Entity Interactive Data Current | Yes | |
Entity Shell Company | false | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Common Stock, Shares Outstanding | 727,440,881 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2020 |
BALANCE SHEETS - UNAUDITED
BALANCE SHEETS - UNAUDITED - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Current Assets | ||
Cash | $ 506,581 | $ 114,504 |
Accounts Receivable, Net | 1,248,217 | 589,710 |
Inventory, Net | 7,692,216 | 4,832,283 |
Other Current Assets | 228,531 | 206,945 |
Total Current Assets | 9,675,545 | 5,743,442 |
Property and Equipment, Net | 1,103,852 | 1,179,794 |
Rental Equipment, Net | 3,087,230 | 4,036,612 |
Other Assets | 412,930 | 489,562 |
Total Other Assets | 4,604,012 | 5,705,968 |
TOTAL ASSETS | 14,279,557 | 11,449,410 |
Current Liabilities | ||
Accounts Payable | 1,822,679 | 531,806 |
Legal Settlement | 398,700 | |
Accrued Expenses | 328,786 | 79,787 |
Joint Venture Liability | 442,000 | 459,500 |
Line of Credit | 324,511 | 408,033 |
Notes Payable, Current Portion | 1,059,971 | 386,528 |
Convertible Notes | 129,217 | |
Total Current Liabilities | 4,505,864 | 1,865,654 |
Deferred Tax Liability | 42,112 | 226,339 |
Notes Payable - Related Party | 252,573 | 334,794 |
Notes Payable, Net of Current Portion | 2,593,518 | 559,235 |
Line of Credit | 5,220,399 | 6,313,628 |
Total Long-Term Liabilities | 8,108,602 | 7,433,996 |
TOTAL LIABILITIES | 12,614,466 | 9,299,650 |
Commitments and Contingencies (Note 12) | ||
Stockholders' Equity | ||
Preferred Stock, $0.001 par value, 5,000,000 shares authorized, no shares issued and outstanding | ||
Common Stock, $0.001 par value, 1,000,000,000 shares authorized, 755,415,879 and 753,415,879 shares issued and outstanding at September 30, 2020 and December 31, 2019, respectively | 755,416 | 753,416 |
Additional Paid-In Capital | 20,802,887 | 20,781,087 |
Accumulated Deficit | (19,893,212) | (19,384,743) |
Total Stockholders' Equity | 1,665,091 | 2,149,760 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 14,279,557 | $ 11,449,410 |
BALANCE SHEETS - UNAUDITED (Par
BALANCE SHEETS - UNAUDITED (Parenthetical) - $ / shares | Sep. 30, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Preferred Stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred Stock, authorized | 5,000,000 | 5,000,000 |
Preferred stock, issued | 0 | 0 |
Preferred stock, outstanding | 0 | 0 |
Common Stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common Stock, authorized | 1,000,000,000 | 1,000,000,000 |
Common Stock, issued | 755,415,879 | 753,415,879 |
Common Stock, outstanding | 755,415,879 | 753,415,879 |
STATEMENTS OF OPERATIONS - UNAU
STATEMENTS OF OPERATIONS - UNAUDITED - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
REVENUES | ||||
Total Revenues | $ 5,880,412 | $ 3,302,228 | $ 9,101,566 | $ 11,219,161 |
COST OF REVENUES | ||||
Total Cost of Revenues | 5,071,886 | 2,084,949 | 7,418,541 | 8,754,208 |
GROSS PROFIT | 808,526 | 1,217,279 | 1,683,025 | 2,464,953 |
OPERATING EXPENSES | ||||
Selling Expense | 136,591 | 127,488 | 284,591 | 315,447 |
General and Administrative | 223,980 | 283,513 | 1,201,065 | 780,881 |
Total Operating Expenses | 360,571 | 411,001 | 1,485,656 | 1,096,328 |
INCOME FROM OPERATIONS | 447,955 | 806,278 | 197,369 | 1,368,625 |
OTHER INCOME (EXPENSE) | ||||
Interest Expense | (366,725) | (135,541) | (887,522) | (571,275) |
Loss from Early Extinguishment of Debt | (482,908) | |||
Other Income (Expense) | (346) | 52,680 | (1,648) | 53,913 |
Total Other Expense | (367,071) | (82,861) | (889,170) | (1,000,270) |
INCOME (LOSS) BEFORE PROVISION (BENEFIT) FOR INCOME TAXES | 80,884 | 723,417 | (691,801) | 368,355 |
PROVISION (BENEFIT) FOR INCOME TAXES | 21,434 | 209,791 | (183,332) | 113,315 |
NET INCOME (LOSS) | $ 59,450 | $ 513,626 | $ (508,469) | $ 255,040 |
Weighted Average Shares Outstanding: | ||||
Basic (in shares) | 753,240,879 | 753,415,879 | 753,240,879 | 753,415,879 |
Diluted (in shares) | 753,240,879 | 753,415,879 | 753,240,879 | 753,415,879 |
Earnings (loss) per Share | ||||
Basic (in dollars per share) | $ 0 | $ 0 | $ 0 | $ 0 |
Diluted (in dollars per share) | $ 0 | $ 0 | $ 0 | $ 0 |
Sales of Equipment and Other Revenues [Member] | ||||
REVENUES | ||||
Total Revenues | $ 5,168,949 | $ 2,724,589 | $ 7,106,628 | $ 9,395,942 |
COST OF REVENUES | ||||
Total Cost of Revenues | 4,824,488 | 1,842,974 | 6,673,745 | 8,040,510 |
Rentals and Leases [Member] | ||||
REVENUES | ||||
Total Revenues | 711,463 | 577,639 | 1,994,938 | 1,823,219 |
COST OF REVENUES | ||||
Total Cost of Revenues | $ 247,398 | $ 241,975 | $ 744,796 | $ 713,698 |
STATEMENTS OF STOCKHOLDERS' EQU
STATEMENTS OF STOCKHOLDERS' EQUITY - UNAUDITED - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Treasury Stock [Member] | Accumulated Deficit [Member] | Total |
Balance, Beginning at Dec. 31, 2018 | $ 753,416 | $ 20,785,924 | $ (4,837) | $ (19,294,449) | $ 2,240,054 |
Balance, Beginning (in shares) at Dec. 31, 2018 | 753,415,879 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Retirement of Treasure Stock | (4,837) | 4,837 | |||
Net Income (Loss) | (282,618) | (282,618) | |||
Balance, End at Mar. 31, 2019 | $ 753,416 | 20,781,087 | (19,577,067) | 1,957,436 | |
Balance, End (in shares) at Mar. 31, 2019 | 753,415,879 | ||||
Balance, Beginning at Dec. 31, 2018 | $ 753,416 | 20,785,924 | $ (4,837) | (19,294,449) | 2,240,054 |
Balance, Beginning (in shares) at Dec. 31, 2018 | 753,415,879 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net Income (Loss) | 255,040 | ||||
Balance, End at Sep. 30, 2019 | $ 753,416 | 20,781,087 | (19,039,409) | 2,495,094 | |
Balance, End (in shares) at Sep. 30, 2019 | 753,415,879 | ||||
Balance, Beginning at Mar. 31, 2019 | $ 753,416 | 20,781,087 | (19,577,067) | 1,957,436 | |
Balance, Beginning (in shares) at Mar. 31, 2019 | 753,415,879 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net Income (Loss) | 24,032 | 24,032 | |||
Balance, End at Jun. 30, 2019 | $ 753,416 | 20,781,087 | (19,553,035) | 1,981,468 | |
Balance, End (in shares) at Jun. 30, 2019 | 753,415,879 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net Income (Loss) | 513,626 | 513,626 | |||
Balance, End at Sep. 30, 2019 | $ 753,416 | 20,781,087 | (19,039,409) | 2,495,094 | |
Balance, End (in shares) at Sep. 30, 2019 | 753,415,879 | ||||
Balance, Beginning at Dec. 31, 2019 | $ 753,416 | 20,781,087 | (19,384,743) | 2,149,760 | |
Balance, Beginning (in shares) at Dec. 31, 2019 | 753,415,879 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net Income (Loss) | (128,079) | (128,079) | |||
Balance, End at Mar. 31, 2020 | $ 753,416 | 20,781,087 | (19,512,822) | 2,021,681 | |
Balance, End (in shares) at Mar. 31, 2020 | 753,415,879 | ||||
Balance, Beginning at Dec. 31, 2019 | $ 753,416 | 20,781,087 | (19,384,743) | 2,149,760 | |
Balance, Beginning (in shares) at Dec. 31, 2019 | 753,415,879 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net Income (Loss) | (508,469) | ||||
Balance, End at Sep. 30, 2020 | $ 755,416 | 20,802,887 | (19,893,212) | 1,665,091 | |
Balance, End (in shares) at Sep. 30, 2020 | 755,415,879 | ||||
Balance, Beginning at Mar. 31, 2020 | $ 753,416 | 20,781,087 | (19,512,822) | 2,021,681 | |
Balance, Beginning (in shares) at Mar. 31, 2020 | 753,415,879 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net Income (Loss) | (439,840) | (439,840) | |||
Balance, End at Jun. 30, 2020 | $ 753,416 | 20,781,087 | (19,952,662) | 1,581,841 | |
Balance, End (in shares) at Jun. 30, 2020 | 753,415,879 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Common stock issued for services | $ 2,000 | 21,800 | 23,800 | ||
Common stock issued for services (in shares) | 2,000,000 | ||||
Net Income (Loss) | 59,450 | 59,450 | |||
Balance, End at Sep. 30, 2020 | $ 755,416 | $ 20,802,887 | $ (19,893,212) | $ 1,665,091 | |
Balance, End (in shares) at Sep. 30, 2020 | 755,415,879 |
STATEMENTS OF CASH FLOWS - UNAU
STATEMENTS OF CASH FLOWS - UNAUDITED - USD ($) | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
CASH FROM OPERATING ACTIVITIES | ||
Net Income (Loss) | $ (508,469) | $ 255,040 |
Adjustments to reconcile Net Income (Loss) to Net Cash Used In Operations Activities: | ||
Depreciation and Amortization | 1,016,925 | 893,508 |
Deferred Income Taxes | (184,227) | 134,673 |
Common stock issued for services | 23,800 | |
Loss on Early Extinguishment of Debt | 482,908 | |
Changes in Operating Assets and Liabilities: | ||
Accounts Receivable | (658,507) | 17,033 |
Inventory | (2,716,043) | (2,342,419) |
Other Current Assets | (21,586) | (182,542) |
Accounts Payable | 1,290,873 | (189,278) |
Legal Settlement | 398,700 | |
Accrued Expenses | 248,999 | (31,569) |
NET CASH USED IN OPERATING ACTIVITIES | (1,109,535) | (962,646) |
INVESTING ACTIVITIES | ||
Payments for Property and Equipment | (135,491) | (160,390) |
Payments for Rental Equipment | (135,699) | |
NET CASH USED IN INVESTING ACTIVITIES | (135,491) | (296,089) |
FINANCING ACTIVITIES | ||
Proceeds from Notes Payable | 4,154,871 | 495,924 |
Payments on Notes Payable | (1,432,142) | (5,618,427) |
Payments on Note Payable - Related Party | (82,221) | (33,438) |
Payments on Joint Venture Liability | (17,500) | |
Net Borrowings (Repayments) Under Lines of Credit | (985,905) | 6,348,546 |
NET CASH PROVIDED BY FINANCING ACTIVITIES | 1,637,103 | 1,192,605 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 392,077 | (66,130) |
Cash and Cash Equivalents, beginning of period | 114,504 | 197,752 |
Cash and Cash Equivalents, end of period | 506,581 | 131,622 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: | ||
Cash Paid For Interest | 878,305 | 487,345 |
Cash Paid For Income Taxes | 800 | 800 |
NONCASH INVESTING AND FINANCING ACTIVITIES: | ||
Equipment Financed under Capital Leases | 298,035 | |
Transfer of Rental Equipment to Inventory | $ 296,279 |
Organization and Basis of Prese
Organization and Basis of Presentation | 9 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Presentation | Note 1 - Organization and Basis of Presentation Organization and Line of Business AmeraMex International, Inc., (the “Company”) was incorporated on May 29, 1990 under the laws of the state of Nevada. The Company sells, leases and rents new and refurbished heavy equipment primarily in the U.S. The Company operates under the name of Hamre Equipment. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 2 – Summary of Significant Accounting Policies Liquidity Considerations At September 30, 2020, the Company had working capital of approximately $5,200,000. On May 1, 2020, the Company received a Paycheck Protection Program Loan in the amount of $228,442 to cover payroll and utility expenses during the COVID-19 pandemic. The Company believes it is following the government guidelines and tracking costs to ensure 100% forgiveness of the loan. The Company is expecting to receive said forgiveness before the end of the year. On April 21, 2020, the Company was approved and received a $10,000 advance on an SBA Loan for $2,000,000. The Company received a second payment of $150,000 on September 10, 2020. The SBA loans bears 3.75% interest for a 30 year term with the first 12 months of payments deferred. Remaining funding on this loan is anticipated over the next 24 months. The Company received an increase of one of their equipment lines of credit from $500,000 to $1,050,000. Moving forward, the Company expects to generate sufficient cash flows from operations to meet its obligations, and expects to continue to obtain financing for equipment purchases in the normal course of business. The Company believes that its expected cash flows from operations, together with its current credit facility, will be sufficient to operate in the normal course of business for the next 12 months from the issuance date of these financial statements. Risks and Uncertainties In March 2020, the World Health Organization declared a novel strain of coronavirus (“COVID-19”) a pandemic, as a result of which the Company is subject to additional risks and uncertainties. In response to the pandemic, governments and organizations have taken preventative or protective actions, such as temporary closures of non-essential businesses and “shelter-at-home” guidelines for individuals. As a result, the global economy has been negatively affected, and the Company’s business has been negatively affected in a number of ways. The Company has had several large transactions that have been put on hold until the State of California is completely reopened. In addition, the Company has all sales, administrative and account employees working from home. Shop employees are practicing social distancing and only one customer is allowed in the facility at a time. Most directly, a number of states and local governments have taken steps that have prohibited or curtailed the sale of equipment or curtailed construction activities during the pandemic. In some jurisdictions, shelter-at-home orders, or other orders related to the pandemic, have impeded and continue to impede equipment sales. The severity of the impact of COVID-19 on the Company’s business will depend on a number of factors, including, but not limited to, the duration and severity of the pandemic and the extent and severity of the impact on the Company’s customers, all of which are uncertain and cannot be predicted. The Company’s future results of operations and liquidity could be adversely impacted by delays in payments of outstanding receivable amounts beyond normal payment terms. Given the dynamic nature of this situation, the Company cannot predict with absolute certainty, the ultimate impact of COVID-19 on its financial condition, results of operations or cash flows. Basis of Presentation The unaudited interim financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information, within the rules and regulations of the United States Securities and Exchange Commission (the “SEC”). Certain information and disclosures normally included in the annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. The unaudited interim financial statements have been prepared on a basis consistent with the audited financial statements and in the opinion of management, reflect all adjustments, consisting of only normal recurring adjustments, necessary for the fair presentation of the results for the interim periods presented and of the financial condition as of the date of the interim balance sheet. The financial data and the other information disclosed in these notes to the interim financial statements related to the three and nine-month periods are unaudited. Unaudited interim results are not necessarily indicative of the results for the full fiscal year. These unaudited interim financial statements should be read in conjunction with the financial statements of the Company for the year ended December 31, 2019 and notes thereto that are included in the Company’s Annual Report on Form 10-K. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. It is possible that accounting estimates and assumptions may be material to the Company due to the levels of subjectivity and judgment involved. Significant estimates in these unaudited interim financial statements include the allowance for doubtful accounts, inventory allowances, convertible notes policy and estimated useful life of property and equipment. Convertible Debt and Embedded Derivatives Convertible debt is accounted for under the guidelines established by Accounting Standards Codification (“ASC”) 470-20, Debt with Conversion and Other Options Many of the conversion features embedded in the Company’s notes become variable upon the event of default or upon the passage of time in the event the Company does not repay the notes, at a premium, at 180 days from issuance of the note. If the conversion price is adjusted based on a discount to the market price of the Company’s common stock, the number of shares upon conversion is potentially unlimited. In the event we cannot control the net share settlement and cash settlement, we record the embedded conversion feature as a derivate instrument, at fair value. The excess of fair value of the embedded conversion feature, together with the original issue discounts, warrants, and issue costs over the face value of the debt, is recorded as an immediate charge in the accompanying statements of operations and cash flows. Each reporting period, the Company will compute the estimated fair value of derivatives and record changes to operations. The discounts are accreted over the term of the debt, which is generally six (6) months after the notes become convertible, using the effective interest method. ASC 470-50, Extinguishments Line of Credit Issuance Costs The Company capitalizes and amortizes direct issue costs incurred in connection with its line of credit arrangement. On or about March 30, 2019 (see Note 6), the Company incurred $245,000 in costs comprised of originations fees totaling approximately $180,000 and appraisal costs of approximately $65,000. These costs are amortized on a straight-line basis over the term of the debt. Included in Other Assets in the accompanying balance sheet at September 30, 2020 are unamortized loan fees of $116,390. During the three and nine months ended September 30, 2020 and 2019, the Company amortized $20,417, $61,250 and $16,129, $34,531 in loan fees, respectively. Recent Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”) which supersedes ASC Topic 840, Leases. ASU 2016-02 requires lessees to recognize a right-of-use asset and a lease liability on their balance sheets for all leases with terms greater than 12 months. Based on certain criteria, leases will be classified as either financing or operating, with classification affecting the pattern of expense recognition in the income statement. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. If a lessee makes this election, it should recognize lease expense for such leases generally on a straight-line basis over the lease term. ASU 2016-02 is effective for fiscal years beginning after December 15, 2020 for smaller reporting companies, and interim periods within those years, with early adoption permitted. The Company will adopt this new standard on January 1, 2021. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. In July 2018, the FASB issued ASU No. 2018-11, “Leases (Topic 842): Targeted Improvements” that allows entities to apply the provisions of the new standard at the effective date, as opposed to the earliest period presented under the modified retrospective transition approach and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The modified retrospective approach includes a number of optional practical expedients primarily focused on leases that commenced before the effective date of Topic 842, including continuing to account for leases that commence before the effective date in accordance with previous guidance, unless the lease is modified. The Company currently expects that most of its operating lease commitments will be subject to the new standard and recognized as operating lease liabilities and right-of-use assets upon its adoption of Topic 842, which will increase the total assets and total liabilities that the Company reports relative to such amounts prior to adoption. |
Inventory
Inventory | 9 Months Ended |
Sep. 30, 2020 | |
Inventory Disclosure [Abstract] | |
Inventory | Note 3 – Inventory Inventory as of September 30, 2020 and December 31, 2019 consisted of the following: September 30, 2020 December 31, 2019 Parts and supplies $ 381,907 $ 250,720 Heavy equipment 7,310,309 4,581,563 Total $ 7,692,216 $ 4,832,283 All of the inventory is used as collateral for the line of credit and notes payable (see Notes 6 and 8). |
Property and Equipment
Property and Equipment | 9 Months Ended |
Sep. 30, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Note 4 – Property and Equipment Property and equipment includes assets held for internal use; as of September 30, 2020 and December 31, 2019, such consisted of the following: September 30, 2020 December 31, 2019 Furniture and fixtures $ 100,596 $ 100,596 Leasehold improvements 467,188 467,188 Vehicles and Equipment 1,619,191 1,483,701 Total, at cost 2,186,975 2,051,485 Less - Accumulated depreciation (1,083,123 ) (871,691 ) Total, Net $ 1,103,852 $ 1,179,794 Depreciation expense for the three and nine months ended September 30, 2020 and 2019 was $72,681, $211,433 and $56,819, $146,737, respectively. All of the property and equipment is used as collateral for the line of credit and notes payable (see Notes 6 and 8). |
Rental Equipment
Rental Equipment | 9 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
Rental Equipment | Note 5 – Rental Equipment Rental equipment as of September 30, 2020 and December 31, 2019 consisted of the following: September 30, 2020 December 31, 2020 Rental equipment $ 6,769,813 $ 6,974,953 Less - Accumulated depreciation (3,682,583 ) (2,938,341 ) Total, Net $ 3,087,230 $ 4,036,612 Depreciation expense for the three and nine months ended September 30, 2020 and 2019 was $246,845, $744,242 and $240,518, $712,240, respectively. All of the rental equipment is used as collateral for the line of credit and notes payable (see Notes 6 and 8). |
Lines of Credit
Lines of Credit | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Lines of Credit | Note 6 – Lines of Credit On May 22, 2020, the limit on the line of credit with a finance company that provides for borrowing up to $500,000 was increased to $1,050,000. The line of credit is secured by the equipment purchased and is interest free if paid within 180 days from the finance date. After the applicable free interest period, interest calculates as follows: 30 day LIBOR plus 6.75% - rate after Free Period to Day 365, 30 day LIBOR plus 7.00% - Rate Day 366 to 720, 30 Day LIBOR plus 7.25% - Rate Day 721 to 1095, 30 Day LIBOR plus 12.00% Matured Rate Day 1096 and above. Each piece of equipment has it own calculations based on the date of purchase. At September 30, 2020 and December 31, 2019, the amounts outstanding under this line of credit agreement were $324,511 with $725,489 available and $408,033 with $91,967 available, respectively. Interest expense for the three and nine months ended September 30, 2020 and 2019 was $837, $1,551 and $982, $6,232, respectively. The agreement has no expiration date provided the Company does not default. On or about March 31, 2019, the Company entered into a line of credit with a finance company that provides for borrowing and refinancing up to $6.5 million. The credit facility expires March 22, 2022. Interest is due monthly at a rate of 10%, per annum. Principal only becomes due and payable if the Company reaches the maximum balance under the credit facility, which management does not expect to reach. If the maximum balance is reached, the principal becomes payable at 1.25% of the outstanding principal balance per month. The line of credit is secured by substantially all of the Company’s assets, other than those specifically secured by an existing agreement. At September 30, 2020 and December 31, 2019, the amounts outstanding under this line of credit agreement were $5,220,399 with $1,279,600 available for purchases and $6,313,628 with $186,372 available, respectively. Interest expense for the three and nine months ended September 30, 2020 was $134,999 and $437,531, respectively. The interest expense for the same periods of 2019 was $106,545 and $262,157, respectively. |
Related-Party Transactions
Related-Party Transactions | 9 Months Ended |
Sep. 30, 2020 | |
Related Party Transactions [Abstract] | |
Related-Party Transactions | Note 7 – Related-Party Transactions Related-Party Note Payable The Company has a note payable to the Company’s President. The note is interest bearing at 10% per annum, unsecured and payable upon demand. The balance of the note at September 30, 2020 and December 31, 2019 was $252,573 and $334,794, respectively. During the nine months ended September 30, 2020 and 2019, the Company repaid $82,221 and $33,438 respectively, on this note payable. The note incurred $9,955, $27,033 and $11,364, $34,093 in interest expense for the three and nine months ended September 30, 2020 and 2019, respectively. Lease The Company leases a building and real property in Chico, California under a one year lease agreement from a trust whose trustee is the Company’s President. The lease provides for monthly lease payments of $9,800 per month, and expired on December 1, 2017. The Company was leasing the building and real property at the same rate on a month-to-month lease until March 1, 2020 when a one-year agreement was signed renewable at anniversary for up to ten years. The new lease provides for monthly lease payments of $12,000. Rent expense during the nine months ended September 30, 2020 and 2019, was $99,135 and $88,200, respectively. Transactions with Director Two separate customers lost financing for purchases of equipment after already receiving the machines, so the Company sold the machines to the brokerage company of one of the Company’s Directors. The customers are now renting the machines on a rent to own basis and the Company is purchasing the machines from the brokerage. The Company has two notes payable tied to these transactions that at September 30, 2020 and December 31, 2019, have a combined total due of $179,457 and $221,566 respectively. The brokerage made $42,681 on the transactions. The notes are secured by the equipment. |
Notes Payable
Notes Payable | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Notes Payable | Note 8 – Notes Payable Notes payable as of September 30, 2020 and December 31, 2019 consisted of the following: September 30, 2020 December 31, 2019 Payable to insurance company; secured by cash surrender value of life insurance policy; no due date $ 158,535 $ 158,535 Note Payable to finance company dated March 20, 2019; interest at 0.0% per annum; monthly payments of $5,000; due at 15 months from issuance; unsecured — 15,000 Note Payable to finance company dated June 17, 2019; interest at 2.90% per annum; monthly payments of $4,749; due 48 months from issuance; secured by equipment 150,468 189,467 Note Payable to finance company dated September 26, 2019; interest at 10.228% per annum; monthly payments of $4,383; due 60 months from issuance; secured by equipment 166,459 197,033 Note Payable to finance company dated September 13, 2019; interest at 2.90% per annum; monthly payments of $3,422; due at 48 months from issuance; secured by equipment 114,722 142,689 Note Payable to finance company dated September 18, 2019; interest at 10.52% per annum; monthly payments of $2,143; due at 35 months from issuance; secured by equipment 44,457 59,566 Note Payable to finance company dated November 1, 2019; interest at 0.0% per annum; monthly payments of $3,000; due 52 months from issuance; final payment of $12,000; secured by equipment 135,000 162,000 Note Payable to finance company dated November 22, 2019; interest at 0.0% per annum; monthly payments of $934; due 24 months from issuance; secured by equipment 13,961 21,473 Note Payable to finance company dated February 19, 2020; interest at 8.0% per annum; monthly payments of $16,500 for the first 6 months then $11,520 for the remaining 36 months; due 42 months from issuance; secured by equipment 358,568 — Note Payable to finance company dated February 13, 2020; interest at 10.35% per annum; monthly payments of $28,903; due 12 months from issuance; unsecured 127,008 — Note Payable to finance company dated March 20,2020; interest at 5.0% per annum; monthly payments of $6,135.98; due 60 months from issuance; secured by equipment 301,044 — Note Payable to finance company dated March 20, 2020; interest at 5.0% per annum; monthly payments of $6,135.98; due 60 months from issuance; secured by equipment 301,044 — Note Payable to finance company dated March 20, 2020; interest at 5.0% per annum; monthly payments of $6,135.98; due 60 months from issuance; secured by equipment 301,044 — Note Payable to finance company dated March 20, 2020; interest at 5.0% per annum; monthly payments of $6,135.98; due 60 months from issuance; secured by equipment 301,044 — Note Payable to finance company dated May 1, 2020; interest at 4.95% per annum; monthly payments of $5,709.31; due 60 months from issuance; secured by equipment 284,958 — Note Payable to finance company dated May 22, 2020; interest at 10.582% per annum; monthly payments of $1,489.66; due 60 months from issuance; secured by equipment 64,699 — Note Payable to Small Business Administration, 1% interest per annum, due in installments from month seven (7) to April 21, 2022. Requested forgiveness. 3.75% on portion not forgiven; monthly payments of $731.00; twelve (12) months deferred for a thirty year term 388,442 — Note Payable to finance company dated June 22, 2020; interest at 10.582% per annum; monthly payments of $1,037.45; due 36 months from issuance; secured by equipment 28,548 — Note Payable to finance company dated June 18, 2020; interest at 4.99% per annum; monthly payments of $1,207.47; due 60 months from issuance; secured by equipment 61,164 — Note Payable to finance company dated June 22, 2020; interest at 10.582% per annum; monthly payments of $3,377.42; due 60 months from issuance; secured by equipment 150,660 — Note Payable to finance company dated August 21, 2020; interest at 3.99% per annum; monthly payments of $4,456.50; due 60 months from issuance; secured by equipment 41,864 — Note Payable to finance company dated September 16, 2020; interest at 4.85% per annum; monthly payments of $4,778.59; due 36 months from issuance; secured by equipment 159,800 — Total 3,653,489 945,763 Less current portion 1,059,971 386,528 Long-term portion $ 2,593,518 $ $559,235 Interest expense for all notes payable for the three and nine months ended September 30, 2020 was $165,562 and $298,359, respectively. The interest expense for the same periods of 2019 was $4,121 and $87,266, respectively. |
Convertible Notes
Convertible Notes | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Convertible Notes | Note 9 – Convertible Notes On or about July 20, 2020 and again on September 16, 2020, the Company and Geneva Roth Remark Holdings, Inc., a New York corporation (“Buyer”) entered into a Securities Purchase Agreement (the “Purchase Agreement”) by which the Buyer purchased and the Company issued and sold convertible notes of the Company, in the aggregate principal amount of $120,000 (the “Notes”), convertible into shares of common stock of the Company (the “Common Stock”). A summary of the terms of the Note are as follows: The principal amount of the Notes is $120,000, with an interest rate of 10% per annum, and a maturity date of July 20, 2021 and September 16, 2021 net of direct loan costs of approximately $6,000. Any amount of principal or interest which is not paid by the maturity date shall bear interest at the rate of 22% per annum from the due date thereof. The Note holds conversion rights, whereby the Buyer has the right from time to time, and at any time after 180 days from July 20, 2020 and ending on the later of: (i) July 20, 2021 and (ii) the date of payment of the Default Amount (payable only in the event of a default), to convert the outstanding amounts of the Note into fully paid and non-assessable shares of Common Stock, at the Conversion Price (defined below). Principal may be repaid before the Maturity Date at the following premiums: Prepayment Period Prepayment Percentage 1. The period beginning on the Issue Date and ending on the date which is 60 days following the Issue Date. 120% 2. The period beginning on the date which is 61 days following the Issue Date and ending on the date which is 90 days following the Issue Date. 125% 3. The period beginning on the date that is 91 days from the Issue Date and ending 150 days following the Issue Date. 130% 4. The period beginning on the date that is 151 days from the Issue Date and ending 180 days following the Issue Date 135% If not paid at Maturity Date, the Conversion Price shall be equal to the Variable Conversion Price (as defined below) (subject to equitable adjustments for stock splits, stock dividends or rights offerings by the Company relating to the Company’s securities or the securities of any subsidiary of the Company, combinations, recapitalization, reclassifications, extraordinary distributions and similar events). The "Variable Conversion Price" shall mean 65% multiplied by the Market Price (as defined below) (representing a discount rate of 35%). “Market Price” means the lowest Trading Price (as defined below) for the Common Stock during the ten Trading Day period ending on the latest complete Trading Day prior to the Conversion Date. “Trading Price” means, for any security as of any date, the closing bid price on the OTCQB, OTCQX, Pink Sheets electronic quotation system or applicable trading market (the “OTC”) as reported by a reliable reporting service. 66,000,000 shares have been reserved for possible conversion and principal and interest will increase to 150% in the event of default. Management intends to pay the Note at or prior to the Maturity Date and will accrete the discount, together with the expected prepayment premium amount, over the expected term not to exceed 180 days. As of September 30, 2020, the accrued and accreted Interest Expense for these convertible notes was $9,217 and $32,783, respectively. |
Revenues
Revenues | 9 Months Ended |
Sep. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | Note 10 – Revenues During the three and nine months ended September 30, 2020 and 2019, revenues and costs related to domestic and foreign sales of equipment are as follows: Three Months Ended September Nine Months Ended September 2020 2019 2020 2019 Equipment Revenues and Other Domestic $ 5,880,412 $ 3,302,228 $ 9,101,566 $ 10,702,161 Export — — — 517,000 Total Revenues and Other $ 5,880,412 $ 3,302,228 $ 9,101,566 $ 11,219,161 Cost of Revenues and Other Domestic $ 5,071,886 $ 2,084,949 $ 7,418,541 $ 8,350,910 Export — — — 403,298 Total Cost of Revenues and Other 5,071,886 2,084,949 7,418,541 8,754,208 Gross Profit $ 808,526 $ 1,217,279 $ 1,683,025 $ 2,464,953 During the nine months ended September 30, 2020 and 2019, there were no foreign rentals of equipment. |
Joint Venture
Joint Venture | 9 Months Ended |
Sep. 30, 2020 | |
Joint Venture Abstract | |
Joint Venture | Note 11 – Joint Venture In 2019, the Company entered into a joint venture with one of its long-time collaborators whereby costs and profits are shared |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 12 – Commitments and Contingencies From time to time, the Company is involved in routine litigation that arises in the ordinary course of business. There were two pending legal proceedings which were subsequently dismissed as the Company reached a combined confidential settlement agreement. As of September 30, 2020, this agreement is reflected on the balance sheet in the amount of $398,700. Should the Company default on payment, a $200,000 penalty will be added to the remaining balance due. See Note 7 for related party operating lease. |
Common Stock
Common Stock | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
Common Stock | Note 13 – Common Stock On September 14, 2020, the Company entered into an agreement with M Vest LLC, a FINRA registered broker-dealer, contracting their services. In addition to monetary compensation, the Company paid out 2,000,000 fully vested shares of the Company’s Common Stock. The shares of Common Stock will have unlimited piggyback registration rights and the same rights afforded other holders of the Company’s Common Stock. We recorded compensation expense totaling $23,800 based on the quoted market price of the Company’s Common Stock. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 14 – Subsequent Events On October 23, 2020, the Company submitted the Paycheck Protection Forgiveness Application to its financial institution According to their response, the bank can take up to 60 days to review the documents for accuracy before then submitting to the SBA. The SBA can then take up to 90 days to complete their review and determination of the request. Based on the form calculation table, the Company is eligible for 100% forgiveness of the PPP loan that was funded on May 1, 2020 equal to $228,442. On or about October 16, 2020, the Company redeemed 26,799,998 shares of common stock from two former employees at zero cost to the Company. These shares were returned to authorized, but unissued status. On or about October 22, 2020, the Company redeemed 1,000,000 shares of common stock from a former employee at a minimal cost to the company. These shares were returned to authorized, but unissued status. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Liquidity Considerations | Liquidity Considerations At September 30, 2020, the Company had working capital of approximately $5,200,000. On May 1, 2020, the Company received a Paycheck Protection Program Loan in the amount of $228,442 to cover payroll and utility expenses during the COVID-19 pandemic. The Company believes it is following the government guidelines and tracking costs to ensure 100% forgiveness of the loan. The Company is expecting to receive said forgiveness before the end of the year. On April 21, 2020, the Company was approved and received a $10,000 advance on an SBA Loan for $2,000,000. The Company received a second payment of $150,000 on September 10, 2020. The SBA loans bears 3.75% interest for a 30 year term with the first 12 months of payments deferred. Remaining funding on this loan is anticipated over the next 24 months. The Company received an increase of one of their equipment lines of credit from $500,000 to $1,050,000. Moving forward, the Company expects to generate sufficient cash flows from operations to meet its obligations, and expects to continue to obtain financing for equipment purchases in the normal course of business. The Company believes that its expected cash flows from operations, together with its current credit facility, will be sufficient to operate in the normal course of business for the next 12 months from the issuance date of these financial statements. |
Risks and Uncertainties | Risks and Uncertainties In March 2020, the World Health Organization declared a novel strain of coronavirus (“COVID-19”) a pandemic, as a result of which the Company is subject to additional risks and uncertainties. In response to the pandemic, governments and organizations have taken preventative or protective actions, such as temporary closures of non-essential businesses and “shelter-at-home” guidelines for individuals. As a result, the global economy has been negatively affected, and the Company’s business has been negatively affected in a number of ways. The Company has had several large transactions that have been put on hold until the State of California is completely reopened. In addition, the Company has all sales, administrative and account employees working from home. Shop employees are practicing social distancing and only one customer is allowed in the facility at a time. Most directly, a number of states and local governments have taken steps that have prohibited or curtailed the sale of equipment or curtailed construction activities during the pandemic. In some jurisdictions, shelter-at-home orders, or other orders related to the pandemic, have impeded and continue to impede equipment sales. The severity of the impact of COVID-19 on the Company’s business will depend on a number of factors, including, but not limited to, the duration and severity of the pandemic and the extent and severity of the impact on the Company’s customers, all of which are uncertain and cannot be predicted. The Company’s future results of operations and liquidity could be adversely impacted by delays in payments of outstanding receivable amounts beyond normal payment terms. Given the dynamic nature of this situation, the Company cannot predict with absolute certainty, the ultimate impact of COVID-19 on its financial condition, results of operations or cash flows. |
Basis of Presentation | Basis of Presentation The unaudited interim financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information, within the rules and regulations of the United States Securities and Exchange Commission (the “SEC”). Certain information and disclosures normally included in the annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. The unaudited interim financial statements have been prepared on a basis consistent with the audited financial statements and in the opinion of management, reflect all adjustments, consisting of only normal recurring adjustments, necessary for the fair presentation of the results for the interim periods presented and of the financial condition as of the date of the interim balance sheet. The financial data and the other information disclosed in these notes to the interim financial statements related to the three and nine-month periods are unaudited. Unaudited interim results are not necessarily indicative of the results for the full fiscal year. These unaudited interim financial statements should be read in conjunction with the financial statements of the Company for the year ended December 31, 2019 and notes thereto that are included in the Company’s Annual Report on Form 10-K. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. It is possible that accounting estimates and assumptions may be material to the Company due to the levels of subjectivity and judgment involved. Significant estimates in these unaudited interim financial statements include the allowance for doubtful accounts, inventory allowances, convertible notes policy and estimated useful life of property and equipment. |
Convertible Debt and Embedded Derivatives | Convertible Debt and Embedded Derivatives Convertible debt is accounted for under the guidelines established by Accounting Standards Codification (“ASC”) 470-20, Debt with Conversion and Other Options Many of the conversion features embedded in the Company’s notes become variable upon the event of default or upon the passage of time in the event the Company does not repay the notes, at a premium, at 180 days from issuance of the note. If the conversion price is adjusted based on a discount to the market price of the Company’s common stock, the number of shares upon conversion is potentially unlimited. In the event we cannot control the net share settlement and cash settlement, we record the embedded conversion feature as a derivate instrument, at fair value. The excess of fair value of the embedded conversion feature, together with the original issue discounts, warrants, and issue costs over the face value of the debt, is recorded as an immediate charge in the accompanying statements of operations and cash flows. Each reporting period, the Company will compute the estimated fair value of derivatives and record changes to operations. The discounts are accreted over the term of the debt, which is generally six (6) months after the notes become convertible, using the effective interest method. ASC 470-50, Extinguishments |
Line of Credit Issuance Costs | Line of Credit Issuance Costs The Company capitalizes and amortizes direct issue costs incurred in connection with its line of credit arrangement. On or about March 30, 2019 (see Note 6), the Company incurred $245,000 in costs comprised of originations fees totaling approximately $180,000 and appraisal costs of approximately $65,000. These costs are amortized on a straight-line basis over the term of the debt. Included in Other Assets in the accompanying balance sheet at September 30, 2020 are unamortized loan fees of $116,390. During the three and nine months ended September 30, 2020 and 2019, the Company amortized $20,417, $61,250 and $16,129, $34,531 in loan fees, respectively. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”) which supersedes ASC Topic 840, Leases. ASU 2016-02 requires lessees to recognize a right-of-use asset and a lease liability on their balance sheets for all leases with terms greater than 12 months. Based on certain criteria, leases will be classified as either financing or operating, with classification affecting the pattern of expense recognition in the income statement. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. If a lessee makes this election, it should recognize lease expense for such leases generally on a straight-line basis over the lease term. ASU 2016-02 is effective for fiscal years beginning after December 15, 2020 for smaller reporting companies, and interim periods within those years, with early adoption permitted. The Company will adopt this new standard on January 1, 2021. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. In July 2018, the FASB issued ASU No. 2018-11, “Leases (Topic 842): Targeted Improvements” that allows entities to apply the provisions of the new standard at the effective date, as opposed to the earliest period presented under the modified retrospective transition approach and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The modified retrospective approach includes a number of optional practical expedients primarily focused on leases that commenced before the effective date of Topic 842, including continuing to account for leases that commence before the effective date in accordance with previous guidance, unless the lease is modified. The Company currently expects that most of its operating lease commitments will be subject to the new standard and recognized as operating lease liabilities and right-of-use assets upon its adoption of Topic 842, which will increase the total assets and total liabilities that the Company reports relative to such amounts prior to adoption. |
Inventory (Tables)
Inventory (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Inventory Disclosure [Abstract] | |
Schedule of inventory | Inventory as of September 30, 2020 and December 31, 2019 consisted of the following: September 30, 2020 December 31, 2019 Parts and supplies $ 381,907 $ 250,720 Heavy equipment 7,310,309 4,581,563 Total $ 7,692,216 $ 4,832,283 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | Property and equipment includes assets held for internal use; as of September 30, 2020 and December 31, 2019, such consisted of the following: September 30, 2020 December 31, 2019 Furniture and fixtures $ 100,596 $ 100,596 Leasehold improvements 467,188 467,188 Vehicles and Equipment 1,619,191 1,483,701 Total, at cost 2,186,975 2,051,485 Less - Accumulated depreciation (1,083,123 ) (871,691 ) Total, Net $ 1,103,852 $ 1,179,794 |
Rental Equipment (Tables)
Rental Equipment (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
Schedule of rental equipment | Rental equipment as of September 30, 2020 and December 31, 2019 consisted of the following: September 30, 2020 December 31, 2020 Rental equipment $ 6,769,813 $ 6,974,953 Less - Accumulated depreciation (3,682,583 ) (2,938,341 ) Total, Net $ 3,087,230 $ 4,036,612 |
Notes Payable (Tables)
Notes Payable (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of notes payable | Notes payable as of September 30, 2020 and December 31, 2019 consisted of the following: September 30, 2020 December 31, 2019 Payable to insurance company; secured by cash surrender value of life insurance policy; no due date $ 158,535 $ 158,535 Note Payable to finance company dated March 20, 2019; interest at 0.0% per annum; monthly payments of $5,000; due at 15 months from issuance; unsecured — 15,000 Note Payable to finance company dated June 17, 2019; interest at 2.90% per annum; monthly payments of $4,749; due 48 months from issuance; secured by equipment 150,468 189,467 Note Payable to finance company dated September 26, 2019; interest at 10.228% per annum; monthly payments of $4,383; due 60 months from issuance; secured by equipment 166,459 197,033 Note Payable to finance company dated September 13, 2019; interest at 2.90% per annum; monthly payments of $3,422; due at 48 months from issuance; secured by equipment 114,722 142,689 Note Payable to finance company dated September 18, 2019; interest at 10.52% per annum; monthly payments of $2,143; due at 35 months from issuance; secured by equipment 44,457 59,566 Note Payable to finance company dated November 1, 2019; interest at 0.0% per annum; monthly payments of $3,000; due 52 months from issuance; final payment of $12,000; secured by equipment 135,000 162,000 Note Payable to finance company dated November 22, 2019; interest at 0.0% per annum; monthly payments of $934; due 24 months from issuance; secured by equipment 13,961 21,473 Note Payable to finance company dated February 19, 2020; interest at 8.0% per annum; monthly payments of $16,500 for the first 6 months then $11,520 for the remaining 36 months; due 42 months from issuance; secured by equipment 358,568 — Note Payable to finance company dated February 13, 2020; interest at 10.35% per annum; monthly payments of $28,903; due 12 months from issuance; unsecured 127,008 — Note Payable to finance company dated March 20,2020; interest at 5.0% per annum; monthly payments of $6,135.98; due 60 months from issuance; secured by equipment 301,044 — Note Payable to finance company dated March 20, 2020; interest at 5.0% per annum; monthly payments of $6,135.98; due 60 months from issuance; secured by equipment 301,044 — Note Payable to finance company dated March 20, 2020; interest at 5.0% per annum; monthly payments of $6,135.98; due 60 months from issuance; secured by equipment 301,044 — Note Payable to finance company dated March 20, 2020; interest at 5.0% per annum; monthly payments of $6,135.98; due 60 months from issuance; secured by equipment 301,044 — Note Payable to finance company dated May 1, 2020; interest at 4.95% per annum; monthly payments of $5,709.31; due 60 months from issuance; secured by equipment 284,958 — Note Payable to finance company dated May 22, 2020; interest at 10.582% per annum; monthly payments of $1,489.66; due 60 months from issuance; secured by equipment 64,699 — Note Payable to Small Business Administration, 1% interest per annum, due in installments from month seven (7) to April 21, 2022. Requested forgiveness. 3.75% on portion not forgiven; monthly payments of $731.00; twelve (12) months deferred for a thirty year term 388,442 — Note Payable to finance company dated June 22, 2020; interest at 10.582% per annum; monthly payments of $1,037.45; due 36 months from issuance; secured by equipment 28,548 — Note Payable to finance company dated June 18, 2020; interest at 4.99% per annum; monthly payments of $1,207.47; due 60 months from issuance; secured by equipment 61,164 — Note Payable to finance company dated June 22, 2020; interest at 10.582% per annum; monthly payments of $3,377.42; due 60 months from issuance; secured by equipment 150,660 — Note Payable to finance company dated August 21, 2020; interest at 3.99% per annum; monthly payments of $4,456.50; due 60 months from issuance; secured by equipment 41,864 — Note Payable to finance company dated September 16, 2020; interest at 4.85% per annum; monthly payments of $4,778.59; due 36 months from issuance; secured by equipment 159,800 — Total 3,653,489 945,763 Less current portion 1,059,971 386,528 Long-term portion $ 2,593,518 $ $559,235 |
Convertible Notes (Tables)
Convertible Notes (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of convertible notes | Principal may be repaid before the Maturity Date at the following premiums: Prepayment Period Prepayment Percentage 1. The period beginning on the Issue Date and ending on the date which is 60 days following the Issue Date. 120% 2. The period beginning on the date which is 61 days following the Issue Date and ending on the date which is 90 days following the Issue Date. 125% 3. The period beginning on the date that is 91 days from the Issue Date and ending 150 days following the Issue Date. 130% 4. The period beginning on the date that is 151 days from the Issue Date and ending 180 days following the Issue Date 135% |
Revenues (Tables)
Revenues (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of revenues and costs related to domestic and foreign sales of equipment | During the three and nine months ended September 30, 2020 and 2019, revenues and costs related to domestic and foreign sales of equipment are as follows: Three Months Ended September Nine Months Ended September 2020 2019 2020 2019 Equipment Revenues and Other Domestic $ 5,880,412 $ 3,302,228 $ 9,101,566 $ 10,702,161 Export — — — 517,000 Total Revenues and Other $ 5,880,412 $ 3,302,228 $ 9,101,566 $ 11,219,161 Cost of Revenues and Other Domestic $ 5,071,886 $ 2,084,949 $ 7,418,541 $ 8,350,910 Export — — — 403,298 Total Cost of Revenues and Other 5,071,886 2,084,949 7,418,541 8,754,208 Gross Profit $ 808,526 $ 1,217,279 $ 1,683,025 $ 2,464,953 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | Apr. 21, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 10, 2020 | May 01, 2020 |
Working capital | $ 5,200,000 | $ 5,200,000 | |||||
Percentage of debt forgiveness | 100.00% | ||||||
Costs comprised of originations fees | $ 245,000 | ||||||
Originations fees | 180,000 | ||||||
Appraisal costs | 65,000 | ||||||
Unamortized loan fees | $ 116,390 | ||||||
Amortized loan fees | $ 20,417 | $ 16,129 | $ 61,250 | $ 34,531 | |||
Description of term of the debt | The discounts are accreted over the term of the debt, which is generally six (6) months after the notes become convertible, using the effective interest method. | ||||||
Minimum [Member] | |||||||
Convertible notes premium ranging | 0.00% | ||||||
Maximum [Member] | |||||||
Convertible notes premium ranging | 1.35% | ||||||
Small Business Administration [Member] | |||||||
Loan face amount | $ 2,000,000 | ||||||
Advance loan received | $ 10,000 | $ 150,000 | |||||
Interest rate | 3.75% | ||||||
Loan terms | 30 years | ||||||
Payment terms | First 12 months of payments deferred | ||||||
Paycheck Protection Program Loan [Member] | |||||||
Loan | $ 228,442 | ||||||
Customer Concentration [Member] | Sales Revenue [Member] | |||||||
Description lines of credit | One of their equipment lines of credit from $500,000 to $1,050,000. |
Inventory (Details)
Inventory (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Inventory [Line Items] | ||
Total | $ 7,692,216 | $ 4,832,283 |
Parts and Supplies [Member] | ||
Inventory [Line Items] | ||
Total | 381,907 | 250,720 |
Heavy Equipment [Member] | ||
Inventory [Line Items] | ||
Total | $ 7,310,309 | $ 4,581,563 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Total, at Cost | $ 2,186,975 | $ 2,051,485 |
Less - Accumulated depreciation | (1,083,123) | (871,691) |
Total, Net | 1,103,852 | 1,179,794 |
Furniture And Fixtures [Member] | ||
Total, at Cost | 100,596 | 100,596 |
Leasehold Improvements [Member] | ||
Total, at Cost | 467,188 | 467,188 |
Vehicles And Equipment [Member] | ||
Total, at Cost | $ 1,619,191 | $ 1,483,701 |
Property and Equipment (Detai_2
Property and Equipment (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Property, Plant and Equipment [Member] | ||||
Depreciation expense | $ 72,681 | $ 56,819 | $ 211,433 | $ 146,737 |
Rental Equipment (Details)
Rental Equipment (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Leases [Abstract] | ||
Rental equipment | $ 6,769,813 | $ 6,974,953 |
Less - Accumulated depreciation | (3,682,583) | (2,938,341) |
Total, Net | $ 3,087,230 | $ 4,036,612 |
Rental Equipment (Details Narra
Rental Equipment (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Rental Equipment [Member] | ||||
Depreciation expense | $ 246,845 | $ 240,518 | $ 744,242 | $ 712,240 |
Lines of Credit (Details Narrat
Lines of Credit (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||
Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | May 22, 2020 | Dec. 31, 2019 | |
Line of credit, outstanding amount | $ 5,220,399 | $ 5,220,399 | $ 6,313,628 | ||||
Line of Credit [Member] | Finance Company [Member] | |||||||
Line of credit maximum borrowing capacity | 500,000 | $ 500,000 | $ 1,050,000 | ||||
Description of line of credit interest rate terms | Interest free if paid within 180 days from the finance date. After the applicable free interest period, interest calculates as follows: 30 day LIBOR plus 6.75% - rate after Free Period to Day 365, 30 day LIBOR plus 7.00% - Rate Day 366 to 720, 30 Day LIBOR plus 7.25% - Rate Day 721 to 1095, 30 Day LIBOR plus 12.00% Matured Rate Day 1096 and above. | ||||||
Line of credit, outstanding amount | 324,511 | $ 324,511 | 408,033 | ||||
Available for borrowing | 725,489 | 725,489 | 91,967 | ||||
Interest expense | 837 | $ 982 | 1,551 | $ 6,232 | |||
Line of Credit for Borrowing and Refinancing [Member] | Finance Company [Member] | |||||||
Line of credit maximum borrowing capacity | $ 6,500,000 | ||||||
Line of credit, expiration date | Mar. 22, 2022 | ||||||
Description of line of credit interest rate terms | If the maximum balance is reached, the principal becomes payable at 1.25% of the outstanding principal balance per month. | ||||||
Collateral | The line of credit is secured by substantially all the Company assets, other than those specifically secured by an existing agreement. | ||||||
Line of credit, outstanding amount | 5,220,399 | 5,220,399 | 6,313,628 | ||||
Available for borrowing | 1,279,600 | 1,279,600 | $ 186,372 | ||||
Interest expense | $ 134,999 | $ 106,545 | $ 437,531 | $ 262,157 |
Related-Party Transactions (Det
Related-Party Transactions (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Notes payable | $ 252,573 | $ 252,573 | $ 334,794 | ||
Interest expenses | $ 366,725 | $ 135,541 | $ 887,522 | $ 571,275 | |
Lease Agreement [Member] | Building and Real Property [Member] | |||||
Lease term | 10 years | 10 years | |||
Monthly lease payable | $ 12,000 | $ 12,000 | |||
Lease expiration date | Mar. 1, 2020 | ||||
Mr. Lee Hamre [Member] | Lease Agreement [Member] | Building and Real Property [Member] | |||||
Lease term | 1 year | 1 year | |||
Monthly lease payable | $ 9,800 | $ 9,800 | |||
Lease expiration date | Dec. 1, 2017 | ||||
Rental expense | $ 99,135 | 88,200 | |||
Director [Member] | Two Notes Payable [Member] | |||||
Notes payable | 179,457 | $ 179,457 | 221,566 | ||
Debt collateral | The notes are secured by the equipment. | ||||
Brokerage expenses | $ 42,681 | ||||
10% Unsecured Notes Payable [Member] | Mr. Lee Hamre [Member] | |||||
Interest rate | 10.00% | ||||
Notes payable | 252,573 | $ 252,573 | $ 334,794 | ||
Repayment of note payable | 82,221 | 33,438 | |||
Interest expenses | $ 9,955 | $ 27,033 | $ 11,364 | $ 34,093 |
Notes Payable (Details)
Notes Payable (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2020 | Dec. 31, 2019 | |
Percentage of debt forgiveness | 100.00% | |
Other notes payable | ||
Total | 3,653,489 | 945,763 |
Less current portion | 1,059,971 | 386,528 |
Long-term portion | $ 2,593,518 | 559,235 |
0.00% Note Payable Due on March 20, 2019 [Member] | ||
Issuance Date | Mar. 20, 2019 | |
Description of periodic payment due | due at 15 months | |
Monthly principal and interest payments | $ 5,000 | |
Total | 15,000 | |
2.90% Note Payable Due on June 17, 2019 [Member] | ||
Issuance Date | Jun. 17, 2019 | |
Description of periodic payment due | due 48 months | |
Monthly principal and interest payments | $ 4,749 | |
Total | $ 150,468 | 189,467 |
10.228% Note Payable Due on September 26, 2019 [Member] | ||
Issuance Date | Sep. 26, 2019 | |
Description of periodic payment due | due 60 months | |
Monthly principal and interest payments | $ 4,383 | |
Total | $ 166,459 | 197,033 |
2.90% Note Payable Due on September 13, 2019 [Member] | ||
Issuance Date | Sep. 13, 2019 | |
Description of periodic payment due | due at 48 months | |
Monthly principal and interest payments | $ 3,422 | |
Total | $ 114,722 | 142,689 |
10.52% Note Payable Due on September 18, 2019 [Member] | ||
Issuance Date | Sep. 18, 2019 | |
Description of periodic payment due | due at 35 months | |
Monthly principal and interest payments | $ 2,143 | |
Total | $ 44,457 | 59,566 |
0.0% Note Payable Due on November 1, 2019 [Member] | ||
Issuance Date | Nov. 1, 2019 | |
Description of periodic payment due | due 52 months | |
Monthly principal and interest payments | $ 3,000 | |
Final payment | 12,000 | |
Total | $ 135,000 | 162,000 |
0.0% Note Payable Due on November 22, 2019 [Member] | ||
Issuance Date | Nov. 22, 2019 | |
Description of periodic payment due | due 24 months | |
Monthly principal and interest payments | $ 934 | |
Total | $ 13,961 | 21,473 |
8.0% Note Payable Due on February 19, 2020 [Member] | ||
Issuance Date | Feb. 19, 2020 | |
Maturity description | first 6 months then $11,520 for the remaining 36 months | |
Description of periodic payment due | due 42 months | |
Monthly principal and interest payments | $ 16,500 | |
Total | $ 358,568 | |
10.35% Note Payable Due on February 13, 2020 [Member] | ||
Issuance Date | Feb. 13, 2020 | |
Description of periodic payment due | due 12 months | |
Monthly principal and interest payments | $ 28,903 | |
Total | $ 127,008 | |
5.0% Note Payable Due on March 20,2020 [Member] | ||
Issuance Date | Mar. 20, 2020 | |
Description of periodic payment due | due 60 months | |
Monthly principal and interest payments | $ 6,136 | |
Total | $ 301,044 | |
5.0% Note Payable Due on March 20,2020 [Member] | ||
Issuance Date | Mar. 20, 2020 | |
Description of periodic payment due | due 60 months | |
Monthly principal and interest payments | $ 6,136 | |
Total | $ 301,044 | |
5.0% Note Payable Due on March 20,2020 [Member] | ||
Issuance Date | Mar. 20, 2020 | |
Description of periodic payment due | due 60 months | |
Monthly principal and interest payments | $ 6,136 | |
Total | $ 301,044 | |
5.0% Note Payable Due on March 20,2020 [Member] | ||
Issuance Date | Mar. 20, 2020 | |
Description of periodic payment due | due 60 months | |
Monthly principal and interest payments | $ 6,136 | |
Total | $ 301,044 | |
4.95% Note Payable Due on May 1,2020 [Member] | ||
Issuance Date | May 1, 2020 | |
Description of periodic payment due | due 60 months | |
Monthly principal and interest payments | $ 5,709 | |
Total | $ 284,958 | |
10.582% Note Payable Due on May 22,2020 [Member] | ||
Issuance Date | May 22, 2020 | |
Description of periodic payment due | due 60 months | |
Monthly principal and interest payments | $ 1,490 | |
Total | $ 64,699 | |
1% Note Payable [Member] | ||
Maturity description | twelve (12) months deferred for a thirty year term | |
Description of periodic payment due | due in installments from month seven (7) to April 21, 2022. | |
Percentage of debt forgiveness | 3.75% | |
Monthly principal and interest payments | $ 731 | |
Total | $ 388,442 | |
10.582% Note Payable Due on June 22,2020 [Member] | ||
Issuance Date | Jun. 22, 2020 | |
Description of periodic payment due | due 36 months | |
Monthly principal and interest payments | $ 1,037 | |
Total | $ 28,548 | |
4.99% Note Payable Due on June 18,2020 [Member] | ||
Issuance Date | Jun. 18, 2020 | |
Description of periodic payment due | due 60 months | |
Monthly principal and interest payments | $ 1,207 | |
Total | $ 61,164 | |
10.582% Note Payable Due on June 22,2020 [Member] | ||
Issuance Date | Jun. 22, 2020 | |
Description of periodic payment due | due 60 months | |
Monthly principal and interest payments | $ 3,377 | |
Total | $ 150,660 | |
3.99% Note Payable Due on August 21, 2020 [Member] | ||
Issuance Date | Aug. 21, 2020 | |
Description of periodic payment due | due 60 months | |
Monthly principal and interest payments | $ 4,456 | |
Total | $ 41,864 | |
4.85% Note Payable Due on September 16, 2020 [Member] | ||
Issuance Date | Sep. 16, 2020 | |
Description of periodic payment due | due 36 months | |
Monthly principal and interest payments | $ 4,778 | |
Total | 159,800 | |
Secured Debt [Member] | ||
Total | $ 158,535 | $ 158,535 |
Notes Payable (Details Narrativ
Notes Payable (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Notes Payable [Member] | ||||
Interest expense, notes payable | $ 165,562 | $ 4,121 | $ 298,359 | $ 87,266 |
Convertible Notes (Details)
Convertible Notes (Details) | 9 Months Ended |
Sep. 30, 2020 | |
Prepayment Period Term 1 [Member] | |
Debt Instrument [Line Items] | |
Prepayment Period | The period beginning on the Issue Date and ending on the date which is 60 days following the Issue Date. |
Prepayment Percentage | 120.00% |
Prepayment Period Term 2 [Member] | |
Debt Instrument [Line Items] | |
Prepayment Period | The period beginning on the date which is 61 days following the Issue Date and ending on the date which is 90 days following the Issue Date. |
Prepayment Percentage | 125.00% |
Prepayment Period Term 3 [Member] | |
Debt Instrument [Line Items] | |
Prepayment Period | The period beginning on the date that is 91 days from the Issue Date and ending 150 days following the Issue Date. |
Prepayment Percentage | 130.00% |
Prepayment Period Term 4 [Member] | |
Debt Instrument [Line Items] | |
Prepayment Period | The period beginning on the date that is 151 days from the Issue Date and ending 180 days following the Issue Date |
Prepayment Percentage | 135.00% |
Convertible Notes (Details Narr
Convertible Notes (Details Narrative) - Securities Purchase Agreement [Member] - Geneva Roth Remark Holdings Inc [Member] - Convertible Note [Member] - USD ($) | Sep. 16, 2020 | Jul. 20, 2020 | Sep. 30, 2020 |
Debt Instrument [Line Items] | |||
Aggregate principal amount | $ 120,000 | $ 120,000 | |
Maturity date | Sep. 16, 2021 | Jul. 20, 2021 | |
Interest rate | 10.00% | 10.00% | |
Payment terms | Management intends to pay the Note at or prior to the Maturity Date and will accrete the discount, together with the expected prepayment premium amount, over the expected term not to exceed 180 days. | ||
Net loan costs | $ 6,000 | $ 6,000 | |
Description of bear interest | Any amount of principal or interest which is not paid by the maturity date shall bear interest at the rate of 22% per annum from the due date thereof. The Note holds conversion rights, whereby the Buyer has the right from time to time, and at any time after 180 days from July 20, 2020 and ending on the later of: (i) July 20, 2021 and (ii) the date of payment of the Default Amount (payable only in the event of a default), to convert the outstanding amounts of the Note into fully paid and non-assessable shares of Common Stock, at the Conversion Price (defined below). | ||
Variable interest rate | 65.00% | ||
Discount rate | 35.00% | ||
Number of shares reserve for conversion | 66,000,000 | ||
Accreted interest expense | $ 32,783 | ||
Accrued expenses | $ 9,217 | ||
Percentage of interest increase in the event of default | 150.00% |
Revenues (Details)
Revenues (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Total Revenues and Other | $ 5,880,412 | $ 3,302,228 | $ 9,101,566 | $ 11,219,161 |
Total Cost of Revenues and Other | 5,071,886 | 2,084,949 | 7,418,541 | 8,754,208 |
Gross Profit | 808,526 | 1,217,279 | 1,683,025 | 2,464,953 |
Domestic [Member] | ||||
Total Revenues and Other | 5,880,412 | 3,302,228 | 9,101,566 | 10,702,161 |
Total Cost of Revenues and Other | 5,071,886 | 2,084,949 | 7,418,541 | 8,350,910 |
Export [Member] | ||||
Total Revenues and Other | 517,000 | |||
Total Cost of Revenues and Other | $ 403,298 |
Joint Venture (Details Narrativ
Joint Venture (Details Narrative) - Joint Venture [Member] - Agreement [Member] | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020USD ($) | Dec. 31, 2019USD ($)Number | |
Number of machines purchase | Number | 30 | |
Closing terminal Seattle Washington | $ 1,089,000 | |
Repaid for equipment sold | $ 17,500 | |
Remitted joint venture profit | 61,651 | |
Amount due to collaborator | $ 442,000 | $ 459,500 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) | Sep. 30, 2020USD ($)Number | Dec. 31, 2019USD ($) |
Number of pending legal proceedings | Number | 2 | |
Accrued expenses | $ 328,786 | $ 79,787 |
Confidential Settlement Agreement [Member] | ||
Accrued expenses | 398,700 | |
Penalty on default on payment | $ 200,000 |
Common Stock (Details Narrative
Common Stock (Details Narrative) - Agreement for services [Member] | Sep. 14, 2020USD ($)shares |
Number of fully vested common shares issued | shares | 2,000,000 |
Compensation expense | $ | $ 23,800 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) | Oct. 23, 2020 | Oct. 22, 2020 | Oct. 16, 2020 | May 01, 2020 |
PPP Loan [Member] | ||||
Subsequent Event [Line Items] | ||||
Paycheck protection program loan | $ 228,442 | |||
Subsequent Event [Member] | Two Former Employees [Member] | ||||
Subsequent Event [Line Items] | ||||
Number of shares redeemed | 26,799,998 | |||
Subsequent Event [Member] | Former Employees [Member] | ||||
Subsequent Event [Line Items] | ||||
Number of shares redeemed | 1,000,000 | |||
Subsequent Event [Member] | PPP Loan [Member] | ||||
Subsequent Event [Line Items] | ||||
Percentage eligible for forgiveness of loan | 100.00% |