U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.

Form 10-Q

(Mark one)

[ X ]

Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended June 30, 2014

[ ]

Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Commission File No. 0-29417

All Energy Corporation

(Exact name of registrant as specified in its charter)

DELAWARE

62-1581902

(State or Other Jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification Number)

6165 N.W. 86th Street, Johnston, Iowa 50131

(Address of principal executive offices, including zip code)

(515) 331-6509

(Issuer’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [ ] No [ X ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer [ ]

Accelerated filer [ ]

Non-accelerated filer [ ] (Do not check if a smaller reporting company)

Smaller reporting company [ X ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes [ ] No [ X ]

As of November 15, 2015, there were 44,302,742 shares of the issuer’s common stock outstanding.

PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
INDEX TO FINANCIAL STATEMENTS
	Page
All Energy Corporation
Consolidated Balance Sheets as of June 30, 2014 (unaudited), and December 31, 2013 (audited)	3

Consolidated Statements of Operations for the Three Months and Six Months Ended June 30, 2014 (unaudited) and 2013 (unaudited), and the Period from Commencement of Development Stage (June 7, 2004) to June 30, 2014 (unaudited)	4

Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2014 (unaudited) and 2013 (unaudited), and the Period from Commencement of Development Stage (June 7, 2004) to June 30, 2014 (unaudited)	6

Notes to Consolidated Financial Statements	8

	ALL ENERGY CORPORATION (a development stage company)
CONSOLIDATED BALANCE SHEETS
	June 30, 2014, and December 31, 2013

	6/30/14 (unaudited)			12/31/13
ASSETS
Current assets
Cash and cash equivalents	$	9,397		$	27,989
Total current assets		9,397			27,989
Assets held for sale		---			275,000
Property and equipment - at cost
Equipment		64,271			8,333
Less accumulated depreciation and amortization		(6,709	)		(3,393	)
Total property and equipment - net		57,562			4,940
Total assets	$	66,959		$	307,929
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities
Accounts payable and accrued expenses	$	128,914		$	133,790
Accrued expenses - related party		724,421			635,235
Notes payable and convertible notes, net of unamortized debt discount of $9,740		844,534			375,000
Notes payable - related parties		10,000			121,800
Liabilities related to assets held for sale		---			50,000
Total current liabilities		1,707,869			1,315,825
Stockholders’ equity (deficit)
Preferred stock, $.01 par value; 20,000,000 shares authorized, -0- and -0- shares issued and outstanding		---			---
Common stock, $.01 par value; 80,000,000 shares authorized, 25,208,563 and 24,727,413 shares issued, respectively, and 25,067,563 and 24,586,413 shares outstanding, respectively		252,086			247,274
Additional paid-in capital		18,219,982			18,210,360
Treasury stock, at cost; 141,000 and 141,000 shares, respectively		(150,000	)		(150,000	)
Receivable from shareholder		(50,000	)		(50,000	)
Accumulated deficit		(6,423,944	)		(6,423,944	)
Deficit accumulated during the development stage		(13,489,033	)		(12,841,586	)
		(1,640,909	)		(1,007,896	)
Total liabilities and stockholders’ equity (deficit)	$	66,959		$	307,929

		ALL ENERGY CORPORATION (a development stage company)
CONSOLIDATED STATEMENTS OF OPERATIONS
	For the Three Months and Six Months Ended June 30, 2014 and 2013, and the Period from Commencement of Development Stage (June 7, 2004) to June 30, 2014

				Three Months Ended June 30,						Six Months Ended June 30,
				2014 (unaudited)			2013 (unaudited)			2014 (unaudited)			2013 (unaudited)			Period from Commencement of Development Stage (June 7, 2004) to 6/30/14 (unaudited)

Revenues			$	---		$	---		$	---		$	---		$	8,092
Operating Costs and Expenses
	Consulting			70,410			28,530			292,597			38,207			8,391,258
	Rent			---			---			---			---			---
	Legal and professional			81,883			12,454			107,116			55,477			1,774,379
	Impairment charge			---			---			---			---			333,540
	Depreciation and amortization			3,069			---			3,316			---			12,635
	General and administrative			126,803			160,383			224,127			310,462			3,577,143
		Total operating expenses		282,165			201,367			627,156			404,146			14,088,955
Other income (expense)
	Beneficial conversion expense			---			---			---			---			(171,000	)
	Interest expense			(12,766	)		(2,862	)		(23,508	)		(4,925	)		(177,839	)
	Interest income			---			---			---			---			51,404
	Rental income			---			---			---			---			66,250
	Loss on sale of land			---			---			---			---			(1,278	)
	Loss on sale of investment			---			---			---			---			(131,650	)
	Equity loss in subsidiary			---			---			---			---			(233,340	)
	Debt discount amortization			---			---			---			---			(151,734	)
	Debt forgiveness income			---			---			---			409,405			507,236
	Other income			---			210,005			---			556,672			556,674
		Total other income (expense)		(12,766	)		207,143			(23,508	)		961,152			314,723
Net income (loss) from continuing operations				(294,931	)		5,776			(650,664	)		557,006			(13,766,140	)
Net income (loss) from discontinued operations				5,993			(229,152	)		3,217			(233,276	)		(435,662	)

The accompanying notes are an integral part of these statements.

ALL ENERGY CORPORATION

(a development stage company)

CONSOLIDATED STATEMENTS OF OPERATIONS

For the Three Months and Six Months Ended June 30, 2014 and 2013, and the Period

from Commencement of Development Stage (June 7, 2004) to June 30, 2014

	Three Months Ended June 30,						Six Months Ended June 30,
	2014 (unaudited)			2013 (unaudited)			2014 (unaudited)			2013 (unaudited)		Period from Commencement of Development Stage (June 7, 2004) to 6/30/14 (unaudited)
Income (loss) per share from continuing operations
Basic	$	(0.01	)	$	(0.00	)	$	(0.03	)	$	0.02
Diluted	$	(0.01	)	$	(0.00	)	$	(0.03	)	$	0.02
Loss per share from discontinued operations
Basic	$	(0.00	)	$	(0.01	)	$	(0.00	)	$	0.01
Diluted	$	(0.00	)	$	(0.01	)	$	(0.00	)	$	0.01
Weighted average number of shares outstanding:
Basic		25,190,230			22,887,413			25,160,631			22,887,413
Diluted		32,290,230			22,887,413			32,260,631			22,887,413
The accompanying notes are an integral part of these statements.

		ALL ENERGY CORPORATION (a development stage company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
	For the Six Months Ended June 30, 2014 and 2013, and the Period from Commencement of Development Stage (June 7, 2004) to June 30, 2014

	Six Months Ended June 30,
	2014 (unaudited)			2013 (unaudited)			Period from Commencement of Development Stage (June 7, 2004) to 6/30/14 (unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)	$	(647,447	)	$	323,730		$	(14,201,802	)
Adjustments to reconcile net loss to cash used for operating activities:
Loss on sale of land		---			---			1,278
Loss on disposition of fixed assets		---			---			187
Forgiveness of debt		---			(409,405	)		(507,236	)
Equity loss in subsidiary		---			---			14,485
Depreciation and amortization		8,302			7,393			26,999
Non-cash beneficial conversion expense		---			---			171,000
Options issued for compensation		---			---			7,039,096
Stock issued for services and compensation		3,185			13,294			1,639,425
Debt discount amortization		1,511			---			153,245
Loss on investments		---			---			125,000
Impairment charge		20,224			234,798			639,596
Increase in accrued expenses		81,876			243,042			363,216
Increase (decrease) in prepaids		---			---			(87,820	)
Increase (decrease) in accounts payable		2,432			(36,143	)		1,089,122
Net cash provided by (used in) operating activities		(529,917	)		376,709			(3,534,209	)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of land		---			---			(951,238	)
Investment in Treaty Belize Energy LTD		---			---			(125,000	)
Investment in oil and gas property		(30,210	)		(261,996	)		(600,420	)
Purchase of property and equipment		(55,938	)		---			(60,938	)
Proceeds from sale of oil and gas property		280,000			---			280,000
Increase in accrued liabilities - related party		---			---			40,056
Proceeds from sale of land		---			---			461,960
Purchase of office equipment		---			---			(4,160	)
Payments on construction-in-progress		---			---			(193,720	)
Net cash used in investing activities		193,852			(261,996	)		(1,153,460	)
The accompanying notes are an integral part of these statements.

		ALL ENERGY CORPORATION (a development stage company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
	For the Six Months Ended June 30, 2014 and 2013, and the Period from Commencement of Development Stage (June 7, 2004) to June 30, 2014

	Six Months Ended June 30,
	2014 (unaudited)			2013 (unaudited)			Period from Commencement of Development Stage (June 7, 2004) to 6/30/14 (unaudited)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from sale of common stock for cash		---			---			2,909,523
Principal payments on related party advances		---			---			(3,988	)
Payment on notes payable - third party		(1,665	)		---			(1,665	)
Proceeds from notes payable - related party		---			2,000			179,800
Proceeds from notes payable - third party		480,938			---			1,504,638
Payment on notes payable - related party		(161,800	)		(5,500	)		(229,300	)
Proceeds from long-term debt, net of deferred borrowing costs		---			---			483,120
Purchase of treasury stock		---			---			(150,000	)
Contributions from shareholders		---			---			950
Net cash provided by (used in) financing activities		317,473			(3,500	)		4,693,078

NET CHANGE IN CASH		(18,592	)		111,213			5,409
Cash, beginning of period		27,989			13,649			3,988
Cash, end of period	$	9,397		$	124,862		$	9,397
The accompanying notes are an integral part of these statements.

		ALL ENERGY CORPORATION (a development stage company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
	June 30, 2014 (unaudited)

Note 1. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited interim financial statements of All Energy Corporation (the “Company”) have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America, pursuant to the Securities and Exchange Commission rules and regulations. In management’s opinion all adjustments necessary for a fair presentation of the results for interim periods have been reflected in the interim financial statements. The results of operations for any interim period are not necessarily indicative of the results for a full year. All adjustments to the financial statements are of a normal recurring nature.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. Such disclosures are those that would substantially duplicate information contained in the most recent audited financial statements of the Company, such as significant accounting policies and stock options. Management presumes that users of the interim statements have read or have access to the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013.

FASB Accounting Standards Codification

The Company presents its financial statements in accordance with generally accepted accounting principles in the United States (“GAAP”). In June 2009, the Financial Accounting Standards Board (“FASB”) completed its accounting guidance codification project. The FASB Accounting Standards Codification (“ASC”) became effective for the Company's financial statements issued subsequent to June 30, 2009, and is the single source of authoritative accounting principles recognized by the FASB to be applied to non-governmental entities in the preparation of financial statements in conformity with GAAP. Accordingly, the Company refers to the ASC as the sole source of authoritative literature.

Note 2. Going Concern

The Company has incurred losses totaling $14,201,802 through June 30, 2014, and had a working capital deficit of $1,698,472 at June 30, 2014. Because of these conditions, the Company will require additional working capital to continue operations and develop its business. The Company intends to raise additional working capital either through private placements, private loans, public offerings and/or bank financing.

There are no assurances that the Company will be able to achieve a level of revenues adequate to generate sufficient cash flow from operations or obtain additional financing through private placements, public offerings and/or bank financing necessary to support the Company’s working capital requirements. To the extent that funds generated from any private placements, public offerings and/or bank financing are insufficient, the Company will have to raise additional working capital. No assurance can be given that additional financing will be available, or if available, will be on terms acceptable to the Company. If adequate working capital is not available, the Company may not continue its operations or execute its business plan.

These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Note 3. Oil and Gas Properties

The Company follows the full cost method of accounting for its oil and gas properties. Accordingly, all costs associated with acquisition, exploration and development of oil and gas reserves are capitalized and accounted for in cost centers. In the Company’s case, for the foreseeable future, all of the Company’s oil and gas properties will be considered a single cost center. For each cost center, capitalized costs, less accumulated amortization and related deferred income taxes, shall not exceed an amount (the cost center ceiling) equal to the sum of:

(1)

The present value of estimated future net revenues computed by applying current prices of oil and gas reserves (with consideration of price changes only to the extent provided by contractual arrangements) to estimated future production of proved oil and gas reserves as of the date of the latest balance sheet presented, less estimated future expenditures (based on current costs) to be incurred in developing and producing the proved reserves computed using a discount factor of ten percent and assuming continuation of existing economic conditions; plus

(2)

The cost of properties not being amortized; plus

(3)

The lower of cost or estimated fair market value of unproven properties included in the costs being amortized; less

(4)

Income tax effects related to differences between the book and tax basis of the properties.

If unamortized costs capitalized within a cost center, less related deferred income taxes, exceed the cost center ceiling (as defined), the excess is charged to expense and separately disclosed during the period in which the excess occurs. Amounts required to be written off will not be reinstated for any subsequent increase in the cost center ceiling.

Depreciation and amortization for each cost center are computed on a composite unit-of-production method, based on estimated proven reserves attributable to the respective cost center. All costs associated with oil and gas properties are currently included in the base for computation and amortization. Such costs include all acquisition, exploration, development costs and estimated future expenditures for proved undeveloped properties, as well as estimated dismantlement and abandonment costs as calculated under the asset retirement obligation category, net of salvage value. The Company's oil and gas property is located within the continental United States.

Gains and losses on sales of oil and gas properties are treated as adjustments of capitalized costs. Gains or losses on sales of property and equipment, other than oil and gas properties, are recognized as part of operations. Expenditures for renewals and improvements are capitalized, while expenditures for maintenance and repairs are charged to operations as incurred.

In May 2014, the Company sold all of its interest in its sole producing oil and gas property. See Note 15. Sale of Oil and Gas Lease.

Note 4. Revenue Recognition

The Company follows the “sales” (takes or cash) method of accounting for oil and gas revenues. Under this method, the Company recognizes revenues on oil and gas production as it is taken and delivered to the purchasers. The volumes sold may be more or less than the volumes the Company is entitled to take based on our ownership in the property. These differences result in a condition known as a production imbalance. Our crude oil and natural gas imbalances are insignificant.

Note 5. Supplemental Reserve Information

The Company’s net proved oil and natural gas reserves as at December 31, 2013, have been estimated by a third-party petroleum engineer.

All estimates are in accordance generally accepted petroleum engineering and evaluation principles and definitions and with guidelines established by the SEC. All of the Company’s reserves are located in the United States of America and accounted for under one cost center.

The Company’s policies and practices regarding internal control over the estimating of reserves are structured to estimate objectively and accurately its oil and natural gas reserve quantities and present values in compliance with SEC regulations and accounting principles generally accepted in the United States of America. The Company does not yet maintain an internal staff of petroleum engineers and geosciences professionals. The data used in the Company’s reserve estimation process is based on historical results for production, oil and natural gas prices received, lease operating expenses and development costs incurred, ownership interest and other required data. Historical oil and gas prices, lease operating expenses, and ownership interests are provided by and verified by the Company’s acting chief financial officer.

The consulting petroleum engineer responsible for the preparation of the Company’s reserve report has a Bachelor of Arts degree in Physics and a Bachelor of Science degree in petroleum engineering from two major universities and has experience in preparing economic evaluations and reserve estimates. He meets the requirements regarding qualifications, objectivity and confidentiality set forth in the Standards Pertaining to the Engineering and Auditing of Oil and Gas Reserves Information promulgated by the Society of Petroleum Engineers.

The following reserve estimates were based on existing economic and operating conditions. Oil prices were calculated using a 12-month average price. Operating costs, production and ad valorem taxes and future development costs were based on current costs with no escalation.

There are numerous uncertainties inherent in estimating quantities of proved reserves and in projecting the future rates of production and timing of development expenditures. The following reserve data represents estimates only and should not be construed as being exact. Moreover, the present values should not be construed as the current market value of the Company's oil and gas reserves or the costs that would be incurred to obtain equivalent reserves.

Proved Oil and Gas Reserves at December 31, 2013 (unaudited)

	Crude Oil BBL	Natural Gas Mcf
Gross Reserves	16,092	---
Net Reserves	12,069	---

Standardized Measure of Discounted Future Net Cash Flows (unaudited)

The Standardized Measure of Discounted Future Net Cash Flows Relating to Proved Oil and Gas Reserves (“Standardized Measures”) does not purport to present the fair market value of a company's oil and gas properties. An estimate of such value should consider, among other factors, anticipated future prices of oil and gas, the probability of recoveries in excess of existing proved reserves, the value of probable reserves and acreage prospects, and perhaps different discount rates. It should be noted that estimates of reserve quantities, especially from new discoveries, are inherently imprecise and subject to substantial revision.

Reserve estimates were prepared in accordance with standard SEC guidelines. The future net cash flow for June 30, 2014, was computed using a 12-month average price. Costs and prices were held constant and were not escalated over the life of the property. No deduction has been made for interest or general corporate overhead. The annual discount of estimated future cash flows is defined, for use herein, as future cash flows discounted at 10% per year, over the expected period of realization.

The Company emphasizes that reserve estimates are inherently imprecise. Accordingly, the estimates are expected to change as more current information becomes available. It is reasonably possible that, because of changes in market conditions or the inherent imprecision of these reserve estimates, that the estimates of future cash inflows, future gross revenues, the amount of oil and gas reserves, the remaining estimated lives of the oil and gas properties, or any combination of the above may be increased or reduced in the near term. If reduced, the carrying amount of capitalized oil and gas properties may be reduced materially in the near term.

Standardized measure of discounted future net cash flows related to proved reserves:

						Proved Producing
		Gross Oil Reserves, BBL Net Oil Reserves, BBL Net Revenue Net Severance and Ad Valorem Tax Net Lease Cost Net Cash Flow Present Worth @ 10%			16,092 12,069 $1,129,929 $51,977 $333,478 $742,475 $484,692

In May 2014, the Company sold all of its interest in its sole producing oil and gas property. See Note 15. Sale of Oil and Gas Lease.

Note 6. Management’s Plans for Liquidity

During the six months ended June 30,2014, the Company obtained $480,938 in operating funds from loans provided by third parties. Since March 31, 2013, the Company has obtained approximately $1,040,000 in operating funds from loans provided by third parties and certain affiliates. See “Issuance of Promissory Notes - 2014” and “Issuance of Promissory Notes - 2015” under Note 17 - Subsequent Events.

Also, in May 2014, the Company sold all of its interest in its sole producing oil and gas property for $280,000 in cash. See Note 15. Sale of Oil and Gas Lease.

With the sale of the Company’s only oil-producing property in May 2014, the Company applies all of its available capital to its efforts in obtaining a permit to mine frac sand on property located in Trempealeau County in Western Wisconsin. There is no assurance that the Company will be successful in these efforts, that it will obtain sufficient capital to sustain its efforts or that it will be able to obtain adequate funding to mine frac sand, should it obtain the required permit. See Note 7. Changes of Business Plan.

The Company will require additional funds, in order to sustain its operations through the remainder of 2015 and the first half of 2016. The Company believes it will be able to secure the financing, in the form of debt, equity or a combination thereof, necessary to complete these opportunities. The Company does not have a current commitment for an equity investment or a loan in any amount.

Note 7. Changes of Business Plan

Until August 2011, the Company actively pursued the acquisition of one or more ethanol plants. As of August 2011, the Company’s efforts in this regard had not been successful. In August 2011, the Company changed its business to the acquisition of interests in oil and gas properties within the United States and the pursuit of business opportunities related to the oil and gas industry. In 2012, the Company purchased its first oil and gas properties and began to operate its only producing oil and gas lease containing two producing wells, which lease was sold in May 2014. See Note 15. Sale of Oil and Gas Lease.

With the sale of this oil-producing property, all of the Company’s efforts are now focused on obtaining a permit to mine frac sand on property located in Trempealeau County in Western Wisconsin. See “Frac Sand Activities” under Note 17. Subsequent Events.

Note 8. Notes Payable - Related Parties

From the third quarter of 2009 through July 2011, the Company obtained $73,000 in loans from one of its directors, the proceeds from which provided the Company with a portion of the capital needed to sustain its operations. On the dates of issuance, and as at December 31, 2012, these promissory notes were convertible into a total of 7,100,000 shares of Company common stock. Until August 2011, these loans were payable on demand, bore interest at 10% per annum and were convertible, at the director’s option, into shares of the Company’s common stock at the rate of one share for every $.01 of debt converted. In August 2011, each of these loans was revised and extended to September 2012, by the issuance of a total of 50,000 shares of Company common stock. In September 2012, each of these loans was again revised and extended to September 2013, by the issuance of a total of 50,000 shares of Company common stock. No further extension transaction has occurred, although this director has indicated that he will not demand payment of such indebtedness, until such time as such repayment would not negatively affect the Company’s financial position. These loans were repaid during the quarter ended June 30, 2014.

In April 2011, another Company director loaned $5,000 to the Company. On the date of issuance, and as at December 31, 2012, and March 31, 2013, this promissory note was convertible into a total of 500,000 shares of Company common stock. Until August 2011, this loan was payable on demand, bore interest at 10% per annum and were convertible, at the director’s option, into shares of the Company’s common stock at the rate of one share for every $.01 of debt converted. In August 2011, this loan was revised and extended to September 2012, by the issuance of 12,500 shares of Company common stock. In September 2012, this loan was again revised and extended to September 2013, by the issuance of 12,500 shares of Company common stock. No further extension transaction occurred. However, in 2014, this $5,000 of indebtedness was converted by this director into 500,000 shares of Company common stock. See “Common Stock Issued Pursuant to Convertible Promissory Notes” under Note 17. Subsequent Events.

Also in April 2011, the Company borrowed $5,000 from a third party for use as working capital, through the issuance of a convertible promissory note, payable on demand, bearing interest at 10% per annum, and convertible, at the third party’s option, into shares of the Company’s common stock at the rate of one share for every $.01 of debt converted. On the date of issuance, this promissory note was convertible into a total of 500,000 shares of Company common stock. In August 2011, this loan was revised and extended to September 2012. In June 2012, $500 of such indebtedness was converted into 50,000 shares of Company common stock. This loan was again revised and extended until September 2013. In 2014, the remaining $4,500 principal amount of this loan was converted into 450,000 shares of the Company’s common stock. See “Common Stock Issued Pursuant to Convertible Promissory Notes” under Note 17. Subsequent Events.

In September 2013, the Company borrowed $94,800 from a director, through the issuance of a promissory note. Initially, at issuance, such promissory note had an interest rate on the unpaid balance of 10.00% per annum for the first six months, with the interest rate increasing by 2.50% every six months thereafter until the promissory note was paid in full, with a rate cap of 18.00%. An interest only payment was due on September 1, 2014, with a balloon payment of the entire outstanding balance, including accrued interest, payable on or before September 1, 2015. In June 2014, this promissory note, including interest, was repaid in full, with proceeds from the Company’s sale of its oil and gas lease.

Note 9. Notes Payable - Third Parties

2011 Notes

In April 2011, the Company borrowed $20,000 from a third party, through the issuance of a convertible promissory note, payable on demand, bearing interest at 10% per annum, and convertible, at the third party’s option, into shares of the Company’s common stock at the rate of one share for every $.01 of debt converted. On the date of issuance, this promissory note was convertible into 2,000,000 shares of Company common stock. In August 2011, this loan was revised and extended to September 2012, and again revised and extended until September 2013. In 2014, the Company issued an amended promissory note, to replace the original convertible promissory note. This amended promissory note is no longer convertible into 2,000,000 shares of Company common stock and the loan is now due the earlier of (a) the date that is three days immediately following the date on which the Company closes a funding transaction that provides capital in amount sufficient to complete the buildout of a proposed frac sand mine of the Company and (b) July 2016. See “Issuances of Promissory Notes - 2014” under Note 17. Subsequent Events.

2012 Notes

In July 2012, the Company issued two convertible secured promissory notes with $25,000 and $25,000 face amounts, respectively, in consideration of two loans of such amounts, one being from a director of the Company. At issuance, each such convertible promissory note was due in July 2017 with interest accruing in amounts equal to 1.8176%, 2.272% and 2.272%, respectively, of the remaining net cash flow of the Company’s subsidiary, AllEnergy - Bell, LLC, and payable each October 31, January 31, April 30 and July 31. Each of these convertible promissory notes was secured by a deed of trust with respect to the Company’s then-owned oil and gas lease located in Taylor County, Texas. Each of the $25,000 face amount convertible secured promissory notes, including accrued interest, has been repaid with a portion of the proceeds from the sale of the Company’s oil and gas lease. See “Repayment of Certain Loans” under Note 17. Subsequent Events.

Also in July 2012 and December 2012, the Company issued, to the same investor, two convertible secured promissory notes with $20,000 face amounts, in consideration of two loans of such amounts. At issuance, these convertible promissory notes were due in July 2017 with interest accruing in amounts equal to 1.8176%, 2.272% and 2.272%, respectively, of the remaining net cash flow of the Company’s subsidiary, AllEnergy - Bell, LLC, and payable each October 31, January 31, April 30 and July 31. Each of these convertible promissory notes was secured by a deed of trust with respect to the Company’s then-owned oil and gas lease located in Taylor County, Texas. In 2014, both of these convertible promissory notes, including accrued interest, were replaced with new promissory notes. See “Issuances of Promissory Notes - 2014” under Note 17. Subsequent Events.

2013 Notes

In September 2013, the Company borrowed a total of $75,000 from a third party, through the issuance of a two separate promissory notes, which bear interest on the unpaid balance at the rate of 5% per annum until paid and are due and payable in September 2014.

In October 2013, the Company borrowed $200,000 from a third party, through the issuance of a promissory note, which bears interest on the unpaid balance at the rate of 5% per annum until paid and is due and payable on the date that is the earlier of (a) the date that is three days immediately following the date on which the Company closes a funding transaction that provides capital to the Company in an amount sufficient to complete the buildout of a proposed frac sand mine of the Company and (b) October 2015.

2014 Notes

In February 2014, the Company borrowed $200,000 from a third party, through the issuance of a promissory note, which bears interest on the unpaid balance at the rate of 5% per annum until paid and is due and payable on the date that is the earlier of (a) the date that is three days immediately following the date on which the Company closes a funding transaction that provides capital to the Company in an amount sufficient to complete the buildout of a proposed frac sand mine of the Company and (b) February 2016.

In March 2014, the Company borrowed $100,000 from a third party, through the issuance of a promissory note, which bears interest on the unpaid balance at the rate of 8% per annum until paid and is due and payable on the date that is the earlier of (a) the date that is two (2) years from the date on which the Company first produces frac sand at its proposed mine located in Trempealeau County, Wisconsin, and (b) March 2018.

Note 10. Arbitration Proceedings

In January 2013, the Company instituted arbitration proceedings against one of its former attorneys in a dispute over fees owed to such attorney. This arbitration was settled prior to a hearing.

Also in January 2013, the Company instituted arbitration in an effort to recover $120,000 due and owing from Treaty Energy Corporation under a rescission agreement. This arbitration proceeding concluded in late 2013, with the Company obtaining an award of $120,000. Currently, the Company is attempting to collect on such award.

Note 11. Capital Stock

Common Stock Issued in Conjunction with Promissory Notes

In October 2013, the Company issued 200,000 shares of common stock to a third-party in conjunction with a promissory note, which shares were valued at $.026 per share, an aggregate value of $5,200.

In February 2014, the Company issued 200,000 shares of common stock to a third-party in conjunction with a promissory note, which shares were valued at $.03 per share, an aggregate value of $6,000. Accordingly, a debt discount was recorded for this and will be amortized over the life of the loan.

In March 2014, the Company issued 100,000 shares of common stock to a third-party in conjunction with a promissory note, which shares were valued at $.02 per share, an aggregate value of $2,000. Accordingly, a debt discount was recorded for this and will be amortized over the life of the loan.

In April 2014, the Company issued 50,000 shares of common stock to a third-party in conjunction with a promissory note, which shares were valued at $.04 per share, an aggregate value of $2,000. Accordingly, a debt discount was recorded for this and will be amortized over the life of the loan.

In May 2014, the Company issued 25,000 shares of common stock to a third-party in conjunction with a promissory note, which shares were valued at $.05 per share, an aggregate value of $1,250. Accordingly, a debt discount was recorded for this and will be amortized over the life of the loan.

Common Stock Issued for Services

In April 2013, the Company issued 20,000 shares of common stock to a third-party consultant pursuant to a consulting agreement. These shares were valued at $.02 per share, or $400, in the aggregate.

In September 2013, the Company issued 20,000 shares of common stock to a third-party consultant pursuant to a consulting agreement. These shares were valued at $.02 per share, or $400, in the aggregate.

In February 2014, the Company issued 106,150 shares of common stock to a third-party consultant in payment of its consulting services, which were valued at $.03 per share, an aggregate value of $3,185.

Common Stock Issued for Director Bonuses

In September 2013, the Company issued a total of 300,000 shares of its common stock as bonuses to two of its directors. These shares were valued at $.07 per share, or $21,000, in the aggregate.

Note 12. Discontinued Operations

Discontinued operations relates to the oil and gas property that was sold in May 2014. The operations related to the oil and gas property have been reclassified to discontinued operations for current reporting period. There was no activity for the prior reporting quarter.

	Six Months Ended 6/30/14		Six Months Ended 6/30/13
Revenue:
Oil and gas revenue	$	44,565		$	15,858
General and administrative		16,138			6,493
Amortization		4,986			7,393
Impairment charge		20,224			234,798
Net profit (loss) from discontinued operations	$	3,217		$	(233,276	)

Note 13. Litigation

In 2013, the Company initiated a lawsuit styled All Energy Corporation and AllEnergy Silica, Arcadia, LLC v. Trempealeau County Environment & Land Use Committee, Case No. 13cv245, in the Circuit Court, Trempealeau County, State of Wisconsin. By this lawsuit, the Company seeks damages associated with the Committee’s refusal to grant the Company’s application for a permit to mine frac sand. The outcome of this lawsuit cannot be predicted.

Note 14. Sale of Oil and Gas Lease

In May 2014, the Company sold all of its interest in its oil and gas lease located in Taylor County, Texas, a 40-acre tract containing with two producing oil wells. The sale price for this lease was $280,000 in cash. With the sale of this producing property, the Company has committed all available resources to obtaining a permit to mine frac sand on property located in Trempealeau County, Wisconsin.

Note 15. Revised Employment Agreement

The Company has entered into a revised employment agreements with its President. As revised, this employment agreement has an initial term of five years, with renewal terms of five years, and pays the officer an annual salary of $240,000. Further, as a signing bonus, this officer was awarded a signing bonus of $120,000, payable as the Company’s operations permit.

Note 16. Frac Sand Activities

Beginning in the first half of 2013, the Company has been actively pursuing a permit to mine frac sand. With the May 2014 sale of its only oil-producing property, all of the Company’s efforts are now focused on obtaining a permit to mine frac sand on property located in Trempealeau County in Western Wisconsin.

Wisconsin Properties. In July 2013, the Company, through a subsidiary, entered into three separate 30-year non-metallic mineral leases relating to contiguous properties located in Trempealeau County, Wisconsin, on which the Company proposes to establish a frac sand mine (the “ALLEnergy Mine”). In total, the three properties contain approximately 550 acres, of which approximately 265 acres of which would be mined. In addition, in July 2013, the Company entered into three separate land purchase agreements relating to approximately 175 acres adjacent to the ALLEnergy Mine property. On this acreage, the Company proposes to construct a frac sand processing facility and a rail load-out facility. Based on the Company’s bore testing of the ALLEnergy Mine property, such property is estimated to contain approximately 35 million tons of high quality frac sand reserves.

Frac Sand Mining Permit Application. In August 2013, the Company submitted its application for a permit to establish the ALLEnergy Mine to Trempealeau County, Wisconsin. After submitting its application, the Company engaged in the established process for obtaining its desired permit. In October 2013, the Company’s permit application was denied by the Trempealeau County Environment & Land Use Committee.

Annexation Process. Following Trempealeau County’s denial of the Company’s permit application, the Company immediately began to pursue the annexation of the ALLEnergy Mine property by the City of Arcadia, Wisconsin. If and when the ALLEnergy Mine property is so annexed, the Company would submit an application for a permit to establish the ALLEnergy Mine to the City of Arcadia. The Company expects a final determination on its annexation proposal from the City of Arcadia in March 2015. The Company cannot predict the outcome of this annexation effort.

Litigation. In response to Trempealeau County’s denial of the Company permit application, the Company has filed two lawsuits against the Trempealeau County Environment & Land Use Committee, including its individual members. See “Frac Sand Mining Permit Litigation” under Note 17. Subsequent Events.

Note 17. Subsequent Events

Issuances of Promissory Notes – 2014

In July 2014, promissory notes were issued, as follows:

–

The Company issued a $20,000 face amount first amended promissory note that replaced an existing convertible promissory note of like face amount. This first amended promissory note is no longer convertible into common stock of the Company and bears interest on the unpaid balance at the rate of 10% per annum until paid, which shall be due and payable on the date that is the earlier of (a) the date that is three (3) days immediately following the date on which the Company closes a funding transaction that provides capital to the Company in an amount sufficient to complete the buildout of a proposed frac sand mine wherever located and (b) July 2016.

–

The Company issued four separate promissory notes with aggregate face amounts of $40,000 that replaced two existing secured convertible promissory notes issued to a single investor with aggregate face amounts of $40,000 and four separate promissory notes with aggregate face amounts of $3,583.92 in payment of the accrued interest on the two replaced secured convertible promissory notes. Each of these promissory notes bears interest on the unpaid balance at the rate of 8% per annum until paid, which shall be due and payable on the date that is the earlier of (a) the date that is three (3) days immediately following the date on which the Company closes a funding transaction that provides capital to the Company in an amount sufficient to complete the buildout of a proposed frac sand mine wherever located and (b) July 2016.

–

The Company issued to a director three separate promissory notes with aggregate face amounts of $20,000 in consideration of his loans to the Company of such aggregate amount. Each of these promissory notes bears interest on the unpaid balance at the rate of 15% per annum until paid, which shall be due and payable on the date that is the earlier of (a) the date that is three (3) days immediately following the date on which the Company closes a funding transaction that provides capital to the Company in an amount sufficient to complete the buildout of a proposed frac sand mine wherever located and (b) July 2016.

In August 2014, promissory notes were issued, as follows:

–

The Company issued to a director three separate promissory notes with aggregate face amounts of $10,000 in consideration of his loans to the Company of such aggregate amount. Each of these promissory notes bears interest on the unpaid balance at the rate of 15% per annum until paid, which shall be due and payable on the date that is the earlier of (a) the date that is three (3) days immediately following the date on which the Company closes a funding transaction that provides capital to the Company in an amount sufficient to complete the buildout of a proposed frac sand mine wherever located and (b) August 2016.

–

The Company issued to a director a promissory note with a face amount of $50,000 in consideration of his loan to the Company of such amount. Each of these promissory notes bears interest on the unpaid balance at the rate of 15% per annum until paid, which shall be due and payable on the date that is the earlier of (a) the date that is three (3) days immediately following the date on which the Company closes a funding transaction that provides capital to the Company in an amount sufficient to complete the buildout of a proposed frac sand mine wherever located and (b) August 2016.

In September 2014, the Company issued to a third party a promissory note with a face amount of $100,000 in consideration of its loan to the Company of such amount. This promissory note bears interest on the unpaid balance at the rate of 8% per annum until paid, which shall be due and payable on the date that is the earlier of (a) the date that is three (3) days immediately following the date on which the Company closes a funding transaction that provides capital to the Company in an amount sufficient to complete the buildout of a proposed frac sand mine wherever located and (b) September 2016.

In October 2014, the Company borrowed $150,000 from a director, through the issuance of a promissory note. Such promissory note has an interest rate on the unpaid balance of 10.00% per annum for the first six months, with the interest rate increasing by 2.50% every six months thereafter until the promissory note is paid in full, with an interest rate cap of 18.00%. An interest only payment is due in October 2015, with a balloon payment of the entire outstanding balance, including accrued interest, payable in October, 2017.

Issuances of Promissory Notes – 2015

In January 2015, the Company issued five separate convertible promissory notes with an aggregate face amount of $500,000. The principal amount of each of the convertible promissory notes is convertible into shares of Company common stock at the rate of six shares for every $1.00 of principal converted, for an aggregate total of 3,000,000 shares of Company common stock underlying such convertible promissory notes.

In June 2015, the Company borrowed $15,000 from a director, through the issuance of a promissory note. Such promissory note has an interest rate on the unpaid balance of 15% per annum until paid. Principal and accrued interest is due and payable on the date that is the earlier of (a) the date that is three (3) days immediately following the date on which the Company closes a funding transaction that provides capital to the Company in amount sufficient to complete the build-out of a proposed frac sand mine of the Company and (b) June 2017.

Loan and Security Agreement

In October 2014, the Company entered into a loan agreement (the “October 2014 Agreement”) with a third party. Under the October 2014 Agreement, the lender may agree to lend the Company up to $300,000: $100,000 of such loan amount was obtained by the Company upon the closing of the October 2014 Agreement; the remaining $200,000 is available to the Company in increments of $75,000, $75,000 and $50,000, should the lender agree to make such additional funds available, of which there is no assurance. The initial $100,000 in funds was used by the Company primarily to pay costs associated with its pending lawsuit filed against the Trempealeau County, Wisconsin, Environment and Land Use Committee. See “Frac Sand Mining Permit Litigation” in this Note 17. Subsequent Events.

The promissory note issued in connection with the October 2014 Agreement states that all unpaid principal amounts shall bear interest at 15% per annum and is payable monthly in arrears, with a mandatory prepayment requirement, should the Company obtain proceeds from one of the pending lawsuits. Otherwise, all of the unpaid principal and accrued interest under such loan is to be paid on or before June 2016.

In connection with the October 2014 Agreement, the Company and the lender entered into a contingent profits agreement (the “Profits Agreement”). Under the Profits Agreement, the lender is granted a 15% profits interest in the frac sand mining project, the permit for which is the subject of one of the Company’s pending lawsuits. The lender is also granted a 30% interest in all damages recovered by the Company with respect to a separate claim for damages against a third party.

Also in connection with the October 2014 Agreement, the Company issued the lender warrants to purchase shares of Company common stock, as follows: (a) 1,000,000 shares at $.10 per share, (b) 1,000,000 shares at $.20 per share, (c) 1,000,000 shares at $.30 per share, and (d) 1,000,000 shares at $.40 per share. All of these warrants expire in October 2019 and contain provisions regarding the adjustment downward of their respective exercise prices, upon the occurrence of certain events. In addition, all of these warrants provide for their cashless exercise.

Further, under the October 2014 Agreement, the Company and the lender entered into an assignment of membership interests agreement, whereby the Company assigned, as security for the loan, its limited liability company membership interests in its frac sand subsidiaries to the lender.

Warrants

In connection with the October 2014 Agreement, the Company issued the lender warrants to purchase shares of Company common stock, as follows: (a) 1,000,000 shares at $.10 per share, (b) 1,000,000 shares at $.20 per share, (c) 1,000,000 shares at $.30 per share, and (d) 1,000,000 shares at $.40 per share. All of these warrants expire in October 2019 and contain provisions regarding the adjustment downward of their respective exercise prices, upon the occurrence of certain events. In addition, all of these warrants provide for their cashless exercise.

Common Stock Issued in Conjunction with Promissory Notes – 2014

In July 2014, shares of Company common stock were issued in conjunction with promissory notes, as follows:

–

The Company issued 40,000 shares of common stock to a third-party, which shares were valued at a per share price of $.04, an aggregate value of $1,600.

–

The Company issued a total of 200,000 shares of common stock to a four third-parties, which shares were valued at a per share price of $.04, an aggregate value of $8,000.

–

The Company issued a total of 100,000 shares of common stock to a director, which shares were valued at an average per share price of $.03715, an aggregate value of $3,750.

In August 2014, shares of Company common stock were issued in conjunction with promissory notes, as follows:

–

The Company issued a total of 50,000 shares of common stock to a director, which shares were valued at an average per share price of $.03, an aggregate value of $1,500.

–

The Company issued 250,000 shares of common stock to another director, which shares were valued at a per share price of $.03, an aggregate value of $7,500.

In September 2014, shares of Company common stock were issued in conjunction with promissory notes, as follows:

–

The Company issued 200,000 shares of common stock to a third-party, which shares were valued at a per share price of $.03, an aggregate value of $6,000.

–

The Company issued a total of 75,000 shares of common stock to a third-party, which shares were valued at an average per share price of $.0383, an aggregate value of $3,250.

In October 2014, the Company issued in conjunction with a promissory note 150,000 shares of common stock to a director, which shares were valued at a per share price of $.03, an aggregate value of $4,500.

Common Stock Issued in Conjunction with Promissory Notes – 2015

In January 2015, the Company issued a total of 2,000,000 shares of Company common stock in conjunction with five separate convertible promissory notes, which shares were valued at a per share price of $.045 per share, an aggregate value of $90,000.

Common Stock Issued for Director Bonuses – 2014

In August 2014, the Company issued a total of 400,000 shares of its common stock as bonuses to two of its directors. These shares were valued at $.03 per share, or $12,000, in the aggregate.

Common Stock Issued for Director Bonuses – 2015

In March 2015, the Company issued a total of 100,000 shares of its common stock as bonuses to two of its directors. These shares were valued at $.05 per share, or $5,000, in the aggregate.

Common Stock Issued for Services – 2015

In March 2015, the Company issued 50,000 shares of common stock in payment of legal services. These shares were valued at $.05 per share, or $2,500, in the aggregate.

Common Stock Issued for Performance Bonuses

In August 2014, the Company issued a total of 4,000,000 shares to two of its consultants as performance bonuses. These shares were valued at $.03 per share, or $120,000, in the aggregate.

In August 2014, the Company issued 10,000,000 shares to its President as a performance bonus. These shares were valued at $.028 per share, or $280,000, in the aggregate. Also in August 2014, the Company issued 1,050,000 shares to one of its directors as a performance bonus. These shares were valued at $.03 per share, or $31,500, in the aggregate.

Common Stock Issued Pursuant to Convertible Promissory Notes

In August 2014, a total of $9,500 of indebtedness evidenced by convertible promissory notes was converted into a total of 950,000 shares of Company common stock, a per share price of $.01. $5,000 of such converted indebtedness was held by a director, who was issued 500,000 of such issued conversion shares.

Revised Employment Agreement

Frac Sand Mining Permit Litigation

In November 2014, the Company initiated a lawsuit styled All Energy Corporation and AllEnergy Silica, Arcadia, LLC v. Trempealeau County Environment & Land Use Committee, Trempealeau Coutny Board of Supervisors, Jeff Bawek, George Brandt, Ed Patzner, Jr., Hensel Vold, Kathy Zeglin, John Doe, and Jane Doe, Case No. 14-CV-242, in the Circuit Court, Trempealeau County, State of Wisconsin. By this lawsuit, the Company seeks damages associated with the Committee’s refusal to grant the Company’s application for a permit to mine frac sand. The outcome of this lawsuit cannot be predicted.

Third-Party Loans – 2015

In January 2015, the Company entered into a series of five separate purchase agreements, pursuant to which the Company obtained $500,000 in loans and issued five separate convertible promissory notes with $500,000 in total face amounts, bearing interest at 15% annum and due and payable on the date that is one year from the date of first commercial production of frac sand at the Company’s proposed mine located in Trempealeau County, Wisconsin. The convertible promissory notes are convertible into shares of Company common stock at the rate of six shares for every $1.00 of principal converted, for an aggregate total of 3,000,000 shares of Company common stock underlying the convertible promissory notes.

Also under the purchase agreements, the investing parties, as a group, received the following: (1) as additional interest, 2,000,000 shares of Company common stock, which shares were valued at $.045 per share; (2) the right to force the sale of the Company’s wetland credits and to have the proceeds from such sale, in an amount equal to the outstanding principal and accrued and unpaid interest under the convertible promissory notes, paid over to the investing parties; (3) at such time as the outstanding number of shares of Company common stock totals 55,000,000, the shares issued as additional interest shall, thereafter, possess rights of non-dilution, that is, the investing parties’ ownership percentage shall be preserved at 3.636%, as measured after each subsequent issuance of Company common stock, with any shares issued pursuant to this provision being valued at the most recent closing sale price of the Company’s common stock; (4) should the Company, prior to April 15, 2016, (i) fail to obtain the a permit to mine frac sand in Trempealeau County, Wisconsin, or (ii) fail to secure binding commitments for financing in a total amount that is sufficient to commence such frac sand mining operations, then: the investing parties’ protected ownership percentage shall increase to 15% and the shares necessary to bring the investing parties’ ownership percentage to such level issued by the Company, which shares being valued at the most recent closing sale price of the Company’s common stock, and, thereafter, the investing parties’ ownership percentage shall be preserved at 15%, as measured after each subsequent issuance of Company common stock; and (5) the investing parties shall be paid, on an annual basis, up to 10% of gross sales of the Company’s first established frac sand mine located in Trempealeau County, Wisconsin.

Related Party Loan – 2015

Date Through Which Subsequent Events Evaluated

The date to which events occurring after June 30, 2014, the date of the most recent balance sheet, have been evaluated for possible adjustment to the financial statements or disclosure is September 21, 2015, which is the date on which the financial statements were available to be issued.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Jumpstart Our Business Startups Act of 2012

As a company with less than $1 billion in revenue during our last fiscal year, we qualify as an “emerging growth company”, as defined in the Jumpstart Our Business Startups Act of 2012 (the JOBS Act). As an emerging growth company, we may take advantage of specified reduced disclosure and other requirements that are otherwise applicable generally to public companies. These provisions include:

Only two years of audited financial statements in addition to any required unaudited interim financial statements with correspondingly reduced “Management's Discussion and Analysis of Financial Condition and Results of Operations” disclosure.

Reduced disclosure about our executive compensation arrangements.

Not having to obtain non-binding advisory votes on executive compensation or golden parachute arrangements.

Exemption from the auditor attestation requirement in the assessment of our internal control over financial reporting.

We may take advantage of these exemptions for up to five years or such earlier time that we are no longer an emerging growth company. We would cease to be an emerging growth company if we have more than $1 billion in annual revenue, we have more than $700 million in market value of our stock held by non-affiliates, or we issue more than $1 billion of non-convertible debt over a three-year period. We may choose to take advantage of some but not all of these reduced burdens. We have taken advantage of these reduced reporting burdens herein, and the information that we provide may be different than what you might get from other public companies in which you hold stock.

2014 Transactions

Divestiture of Oil and Gas Property. In May 2014, we sold all of our interest in our only producing oil and gas lease located in Taylor County, Texas, a 40-acre tract with two producing oil wells. The sale price for this lease was $280,000 in cash. We used the proceeds of this sale to retire approximately $185,000 of debt, with the balance being applied to our ongoing frac sand mine efforts.

Focus on Frac Sand Mine Acquisition. With the sale of our only oil-producing property in May 2014, all of our efforts are now focused on obtaining a permit to mine frac sand on property located in Trempealeau County in Western Wisconsin. There is no assurance that we will be successful in these efforts, that we will obtain sufficient capital to sustain our efforts or that we will be able to obtain adequate funding to mine frac sand, should we obtain the required permit.

2015 Transactions

In January 2015, we entered into a series of five separate purchase agreements, pursuant to which we obtained $500,000 in loans and issued five separate convertible promissory notes with $500,000 in total face amounts, bearing interest at 15% annum and due and payable on the date that is one year from the date of first commercial production of frac sand at our proposed mine located in Trempealeau County, Wisconsin. The convertible promissory notes are convertible into shares of our common stock at the rate of six shares for every $1.00 of principal converted, for an aggregate total of 3,000,000 shares of our common stock underlying the convertible promissory notes.

measured after each subsequent issuance of our common stock, with any shares issued pursuant to this provision being valued at the most recent closing sale price of our common stock; (4) should our company, prior to April 15, 2016, (i) fail to obtain the a permit to mine frac sand in Trempealeau County, Wisconsin, or (ii) fail to secure binding commitments for financing in a total amount that is sufficient to commence such frac sand mining operations, then: the investing parties’ protected ownership percentage shall increase to 15% and the shares necessary to bring the investing parties’ ownership percentage to such level issued by us, which shares being valued at the most recent closing sale price of our common stock, and, thereafter, the investing parties’ ownership percentage shall be preserved at 15%, as measured after each subsequent issuance of our common stock; and (5) the investing parties shall be paid, on an annual basis, up to 10% of gross sales of our first established frac sand mine located in Trempealeau County, Wisconsin.

Critical Accounting Policies

While we believe that the factors considered provide a meaningful basis for the accounting policies applied in the preparation of the condensed consolidated financial statements, we cannot guarantee that our estimates and assumptions will be accurate. If such estimates and assumptions prove to be inaccurate, we may be required to make adjustments to these estimates in future periods.

Litigation and Tax Assessments. Should we become involved in lawsuits, we intend to assess the likelihood of any adverse judgments or outcomes of any of these matters as well as the potential range of probable losses. A determination of the amount of accrual required, if any, for these contingencies will be made after careful analysis of each matter. The required accrual may change from time to time, due to new developments in any matter or changes in approach (such as a change in settlement strategy) in dealing with these matters.

Additionally, in the future, we may become engaged in various tax audits by federal and state governmental authorities incidental to our business activities. We anticipate that we will record reserves for any estimated probable losses for any such proceeding.

Stock-Based Compensation. We account for stock-based compensation based on the provisions of Accounting Standard Codification (“ASC”) 718 Share Based Payments. ASC 718 requires companies to apply a fair-value-based measurement method in accounting for share-based payment transactions with employees and to record compensation cost for all stock awards granted after the required effective date and for awards modified, repurchased or cancelled after that date. The scope of ASC 718 encompasses a wide range of share-based compensation arrangements, including share options, restricted share plans, performance-based awards, share appreciation rights and employee share purchase plans.

Recently Issued Accounting Pronouncements. The FASB issued Accounting Standards Update No 2013-02 “Comprehensive Income (Topic 220); Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income”. The objective of this Update is to improve the reporting of reclassification out of accumulated other comprehensive income. The amendments in this Update apply to all entities that issue financial statements that are presented in conformity with U.S. GAAP and that report items of other comprehensive income. The amendments are effective for reporting periods beginning after December 15, 2013. The Company has adopted this amendment as of the effective date; however the adoption of this amendment will not have a material impact on the consolidated financial statements of the Company.

Currently, there are no other new accounting pronouncements that were issued to be effective in 2012 or subsequent thereto that would have a material impact on the Company’s financial reporting.

Results of Operations - First Six Months 2014 vs. First Six Months 2013

Revenues. During the First Six Months 2014, we generated $44,565 in revenues from our oil and gas production activities. During the First Six Months 2013, we generated $15,858 in revenues from our oil and gas production activities. During the First Six Months 2014, our monthly cash operating expenses averaged approximately $20,000.

Expenses. Our cash operating expenses during the First Six Months 2014 were $519,917, up from $376,709 for the First Six Months 2013. During the First Six Months 2014 and the First Six Months 2013, we incurred $37,787 and $13,294 for stock issued for services, respectively.

Financial Condition

At June 30, 2014, we had $9,397 in cash and a working capital deficit of $1,713,187. At December 31, 2013, our cash position was $27,989 and our working capital deficit was $1,287,836. Currently, we possess approximately $20,000 in cash. Our current cash position is adequate to sustain our current level of operations for approximately three months.

Pursuant to a series of agreements, in February 2013, certain promissory notes and warrants were cancelled and all principal and accrued interest extinguished, as follows: $16,800 promissory note, 8,000,000 Series A Warrants and 8,000,000 Series B Warrants; $88,200 promissory note, 42,000,000 Series A Warrants and 42,000,000 Series B Warrants; $17,800 promissory note, 8,476,190.48 Series A Warrants and 8,476,190.48 Series B Warrants; $10,000 promissory note, 4,761,904.76 Series A Warrants and 4,761,904.76 Series B Warrants; $77,200 promissory note, 36,761,904.76 Series A Warrants and 36,761,904.76 Series B Warrants; $12,500 promissory note, $7,500 promissory note, $2,500 promissory note, $100,000 promissory note and $10,000 promissory note; $10,000 promissory note; $12,500 promissory note, $7,500 promissory note, $2,500 promissory note, $5,000 promissory note and $5,000 promissory note; and $100,000 promissory note and $10,000 promissory note.

Currently, we apply all of our available capital to our efforts in obtaining a permit to mine frac sand. From the May 2014 sale of our only producing oil and gas lease, we derived $280,000 in cash. We used the proceeds of this sale to retire approximately $185,000 of debt, with the balance being applied to our ongoing efforts in obtaining a permit to mine frac sand. There is no assurance that we will be successful in these efforts, that we will obtain sufficient capital to sustain our efforts or that we will be able to obtain adequate funding to mine frac sand, should we obtain a permit to mine frac sand.

Also under the purchase agreements, the investing parties, as a group, received the following: (1) as additional interest, 2,000,000 shares of our common stock, which shares were valued at $.045 per share; (2) the right to force the sale of our company’s wetland credits and to have the proceeds from such sale, in an amount equal to the outstanding principal and accrued and unpaid interest under the convertible promissory notes, paid over to the investing parties; (3) at such time as the outstanding number of shares of our common stock totals 55,000,000, the shares issued as additional interest shall, thereafter, possess rights of non-dilution, that is, the investing parties’ ownership percentage shall be preserved at 3.636%, as measured after each subsequent issuance of our common stock, with any shares issued pursuant to this provision being valued at the most recent closing sale price of our common stock; (4) should our company, prior to April 15, 2016, (i) fail to obtain the a permit to mine frac sand in Trempealeau County, Wisconsin, or (ii) fail to secure binding commitments for financing in a total amount that is sufficient to commence such frac sand mining operations, then: the investing parties’ protected ownership percentage shall increase to 15% and the shares necessary to bring the investing parties’ ownership percentage to such level issued by us, which shares being valued at the most recent closing sale price of our common stock, and, thereafter, the investing parties’ ownership percentage shall be preserved at 15%, as measured after each subsequent issuance of our common stock; and (5) the investing parties shall be paid, on an annual basis, up to 10% of gross sales of our first established frac sand mine located in Trempealeau County, Wisconsin.

Management’s Plans Relating to Future Liquidity

We will require significant additional capital with which to, first, obtain a permit to mine frac sand on property located in Trempealeau County in Western Wisconsin and, then, to begin commercial production of frac sand thereon. While our management believes we will be able to secure the financing, in the form of debt, equity or a combination thereof, necessary to complete such objectives, there is no assurance that we will be successful in these efforts, that we will obtain sufficient capital to sustain our efforts or that we will be able to obtain adequate funding to mine frac sand, should we obtain the required permit.

In addition, we will require additional funds, in order to sustain our operations through the remainder of 2015 and all of 2016. We believe we will be able to secure the financing, in the form of debt, equity or a combination thereof, necessary to complete these opportunities. We do not have a current commitment for an equity investment or a loan in any amount.

Capital Expenditures

During the First Six Months 2014 and the First Six Months 2013, we made capital expenditures in the amounts of $86,148 and $261,996, respectively. Due to the uncertainty of our obtaining a permit to mine frac sand, we cannot predict the amount of our future capital expenditures, if any.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Not applicable.

Item 4T. Controls and Procedures.

Our Chief Executive Officer/Acting Chief Financial Officer, after evaluating the effectiveness of our disclosure controls and procedures, as defined in Rule 13a-15(e) of the Securities Exchange Act of 1934 has concluded that, as of the end of the fiscal quarter covered by this report on Form 10-Q, our disclosure controls and procedures were not effective to provide reasonable assurances that information required to be disclosed in the reports filed or submitted under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and such information is accumulated and communicated to management, including the Chief Executive Officer/Acting Chief Financial Officer, as appropriate, to allow timely decisions regarding disclosures.

There was no change in our internal control over financial reporting during the quarter ended June 30, 2014, that has materially affected, or is reasonably likely to materially affect, our company’s internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

Currently, we are the plaintiff in a lawsuit styled All Energy Corporation and AllEnergy Silica, Arcadia, LLC v. Trempealeau County Environment & Land Use Committee, Trempealeau Coutny Board of Supervisors, Jeff Bawek, George Brandt, Ed Patzner, Jr., Hensel Vold, Kathy Zeglin, John Doe, and Jane Doe, Case No. 14-CV-242 in the Circuit Court, Trempealeau County, State of Wisconsin. By this lawsuit, we seek damages associated with the Committee’s refusal to grant our application for a permit to mine frac sand, in violation of our rights under the Fourteenth Amendment of the United States Constitution and 42 U.S.C. §1983. The outcome of this lawsuit cannot be predicted.

Currently, we are the plaintiff in a lawsuit styled AllEnergy Corp., et al. v. Trempealeau County Environment and Land Use Committee, Case No. 2013-CV-245, in the Trempealeau County Circuit Court, State of Wisconsin. We are, in a claim for certiorari relief, seeking the reversal of the Committee’s decision to deny us a permit to mine frac sand. We are unable to predict the outcome of this litigation.

In 2013, we settled a lawsuit styled ALL Fuels & Energy Corporation v. Energetix, LLC, Energetix Holdings II, LLC and Mitch Miller, Case No. 4:11-CV-00617-JEG-CFB, in the U.S. District Court for the Southern District of Iowa, Central Division, in which our company was the plaintiff. We sued the defendants for violating the terms of a non-circumvention agreement relating to the acquisition of an ethanol plant.

In 2013, we instituted arbitration proceedings against one of our former attorneys in a dispute over fees owed to such attorney, with respect to the lawsuit described in the immediately preceding paragraph. This arbitration was settled prior to a hearing.

In 2013, we instituted arbitration in an effort to recover $120,000 due and owing from Treaty Energy Corporation under a rescission agreement. This arbitration proceeding concluded in late 2013, with our company obtaining an award of $120,000. Currently, we are attempting to collect on such award.

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

During the six months ended June 30, 2014, we did not issue unregistered securities that have not been reported previously.

Item 3. Defaults upon Senior Securities.

None.

Item 4. Submission of Matters to a Vote of Security Holders.

No matters were submitted to our shareholders during the three months ended June 30, 2014.

Item 5. Other Information.

None.

Item 6. Exhibits.

	Exhibit No.		Description
	31.1 *		Certification of Chief Executive Officer and Principal Financial and Accounting Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
	32.1 *		Certification of Chief Executive Officer and Principal Financial and Accounting Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
	101.INS **		XBRL Instance Document.
	101.SCH **		XBRL Schema Document.
	101.CAL **		XBRL Taxonomy Extension Calculation Linkbase Document.
	101.DEF **		XBRL Taxonomy Extension Definition Linkbase Document.
	101.LAB **		XBRL Taxonomy Extension Labels Linkbase Document.
	101.PRE **		XBRL Taxonomy Extension Presentation Linkbase Document.
*		filed herewith.
**		furnished herewith.

SIGNATURES

In accordance with the requirements of the Securities Exchange Act of 1934, Registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

Date: November 30, 2015.

ALL ENERGY CORPORATION

By: /S/ DEAN E. SUKOWATEY

Dean E. Sukowatey

President and Acting

Chief Financial Officer

All Energy Corp 10-Q