UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ ~~Quarterly~~QUARTERLY ~~report~~REPORT ~~pursuant~~PURSUANT ~~Section~~TO SECTION 13 orOR 15(d) ofOF ~~the~~THE ~~Securities~~SECURITIES ~~Exchange~~EXCHANGE ~~Act~~ACT ofOF 1934

For the quarterly period ended ~~September~~March 3031, ~~2018~~2019

☐TRANSITION ~~Transition~~REPORT ~~report~~PURSUANT ~~pursuant~~TO ~~Section~~SECTION 13 orOR 15(d) ofOF ~~the~~THE ~~Securities~~SECURITIES ~~Exchange~~EXCHANGE ~~Act~~ACT ofOF 1934

For the transition period from ~~_______~~ to ~~_______~~

Commission File Number: 000-55152

(Commission file number)

ZNERGY, INC.

(Exact ~~name~~Name of ~~registrant~~Registrant asAs ~~specified~~Specified inIn ~~its~~Its ~~charter~~Charter)

Nevada		46-1845946
(State or other jurisdiction of incorporation or organization)		(IRS I.RD.~~S. Employer Identification No.)~~
808 A South Huntington Street Syracuse, Indiana 46567 (Address of principal executive offices)
(800) 931 5662 (Registrant’s telephone number, including area code)

808A South Huntington Street, Syracuse, Indiana		46567
(Address of principal executive offices)		(Zip Code)

Securities registered under 12(b) of the Exchange Act:

800-931-5662 (Registrant’s telephone number, including area code)

None

~~(Former~~Securities ~~name,~~registered ~~former~~under ~~address~~12(g) ~~and~~of ~~former~~the ~~fiscal~~Exchange ~~year,~~Act: ~~if changed since last report)~~

Common Stock, par value $0.0001

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 ☒

Indicate by check mark whether the registrant has submitted electronically, if any, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☐ No ☒

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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

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

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

Yes ☐ No ☒

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

Title of each class	Symbol	Name of each exchange on which registered
Common	ZNRG	OTC

On July 3012, ~~2019~~2021 there were ~~271~~305,~~924~~208,~~960~~293 shares of the registrant’'s common stock outstanding.

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TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION
	Item 1.	Condensed Consolidated Financial Statements	4
	Item 2.	Management’'s Discussion and Analysis of Financial Condition and Results of Operations	1519
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	1822
	Item 4.	Controls and Procedures	1822
Part II - OTHER INFORMATION			19
	Item 1.	Legal Proceedings	1923
	Item 5.	Other Information	1923
	Item 6.	Exhibits	2024
SIGNATURES			2125

Table of Contents

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

ZNERGY, INC.

INDEX

CONTENTS:
Condensed Consolidated Balance Sheets as of September 30, 2018 (unaudited) and December 31, 2017	5
Condensed Consolidated Balance Sheets as of March 31, 2019 (unaudited) and December 31, 2018	5
Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2018 and 2017 (unaudited)	6
Condensed Consolidated Statements of Operations for the three months ended March 31, 2019 and 2018 (unaudited)	6
Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2018 and 2017 (unaudited)	7
Condensed Consolidated Statements of Changes in Stockholders’ Deficit for the three months ended March 31, 2019 and 2018 (unaudited)	7
Notes to Unaudited Condensed Consolidated Interim Financial Statements	8
Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2019 and 2018 (unaudited)	8
Notes to Unaudited Condensed Consolidated Interim Financial Statements	9

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ZNERGY, INC.

~~CONDENSED~~ CONSOLIDATED BALANCE SHEETS

	September 30,			December 31,
	March 31,			December 31,
	2018			2017
	2019			2018
	(UNAUDITED)
ASSETS
CURRENT ASSETS
Cash	$	615,~~356~~216		$	~~116,481~~593
Accounts receivable, net		57,784			112,818
Accounts receivable, net of allowance		13,522			-
Prepaid expenses		4592,~~941~~460			3561,~~365~~457
Inventory		~~830~~353,~~157~~432			~~444~~299,~~606~~428
Total current assets	$	~~940~~474,~~238~~630		$	~~709~~361,~~270~~478
Building, equipment and furniture, net		83,354			364,093
Building, furniture and equipment, net		21,267			28,352
Intangible assets		1,845			1,845
TOTAL ASSETS	$	495,897		$	389,830
TOTAL ASSETS	$	1,025,437		$	1,075,208
LIABILITIES AND STOCKHOLDERS' DEFICIT
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable	$	~~511~~456,~~858~~182		$	~~431~~403,~~267~~307
Accrued expenses		~~216~~343,~~341~~871			~~179~~341,~~628~~556
Customer deposits		51216,~~006~~325			3930,~~453~~642
Advances from related parties		~~322~~270,~~224~~788			-222,788
Loan, building		-			225,000
Loan from related parties		1,310,679			1,290,304
Loans from related parties		729,429			171,518
Total current liabilities	$	2,597,845		$	2,288,597
Total current liabilities		1,830,858			1,046,866
COMMITMENTS AND CONTINGENCIES (Note 10)
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' DEFICIT
STOCKHOLDERS’ (DEFICIT) EQUITY
Preferred stock, $0.0001 par value, 100,000,000 authorized shares; no shares issued and outstanding		-			-
Common stock, $0.0001 par value; 500,000,000 shares authorized; 235,724,960 and 230,724,960 issued and outstanding at September 30, 2018 and December 31, 2017, respectively		23,672			23,072
Common stock, $0.0001 par value; 500,000,000 shares authorized; 256,724,960 and 236,724,960 shares issued and outstanding at March 31, 2019 and December 31, 2018, respectively		25,672			23,672
Additional paid-in-capital		1316,~~678~~108,~~326~~720			1214,~~444~~220,~~488~~537
Accumulated deficit		(1418,~~507~~236,~~419~~340	)		(1216,~~439~~142,~~218~~976	)
Total Stockholders’ Equity/(Deficit)		(805,421	)		28,342
Total stockholders' deficit		(2,101,948	)		(1,898,767	)
TOTAL LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY	$	1,025,437		$	1,075,208
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$	495,897		$	389,830

The accompanying notes are an integral part of these ~~condensed~~ consolidated financial statements.

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ZNERGY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE THREE ~~AND NINE~~ MONTHS ENDED

(Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	For the Three Months Ended
	2018			2017			2018			2017
	March 31,			March 31,
Revenue	$	556,142		$	586,976		$	1,298,696		$	1,015,217
	2019			2018
Cost of revenue		259,158			423,334			665,154			596,661
Revenue	$	186,618		$	482,972
Gross profit		296,984			163,642			633,542			418,556
Cost of revenue		175,402			229,628
Selling, general and administrative expenses		668,000			1,241,262			2,486,001			3,654,877
Gross profit		11,216			253,344
Loss from operations		(371,016	)		(1,077,620	)		(1,852,459	)		(3,236,321	)
Selling, general and administrative expenses		2,090,664			1,234,352
Other income (expense)
Total operating expenses		2,090,664			1,234,352
Other (expense)		7,730			-			(35,758	)		-
Loss from operations		(2,079,448	)		(981,008	)
Interest Expense		(3,749	)		-			(179,899	)		-
Other income (expense)
Total other income (expense)		3,981			-			(215,657	)		-
Other income		1,459			-
Loss before provision for income taxes		(367,035	)		(1,077,620	)		(2,068,116	)		(3,236,321	)
Interest expense		(15,375	)		(111,559	)
Provision for income taxes		-			-			-
Total other expense		(13,916	)		(111,559	)
Net loss	$	(367,035	)	$	(1,077,620	)	$	(2,068,116	)	$	(3,236,321	)
Provision for income taxes		-			-
Net loss per common share - basic and diluted	$	(0.00	)	$	(0.01	)	$	(0.01	)	$	(0.02	)
					-
Weighted average number of shares outstanding - basic and diluted		229,024,960			214,074,451			228,991,993			205,493,759
Net loss	$	(2,093,364	)	$	(1,092,567	)
Net loss per common share - basic and diluted	$	(0.01	)	$	(0.01	)
Weighted average number of shares outstanding - basic and diluted		256,724,960			214,644,216

The accompanying notes are an integral part of these condensed consolidated financial statements.

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ZNERGY, INC.

~~CONDENSED~~ CONSOLIDATED ~~STATEMENTS~~STATEMENT OF ~~CASH~~CHANGES ~~FLOWS~~IN STOCKHOLDERS' EQUITY

~~(unaudited)~~FOR THE THREE MONTHS ENDED MARCH 31, 2019 and 2018

	Nine Months Ended
	September 30,			September 30
	2018			2017
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(2,068,116	)	$	(3,236,321	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		27,478			1,862
Loss on sale of assets		41,608			-
Common stock and options issued for services		1,183,611			2,564,198
Non-cash interest expense		173,652			519,085
Bad debt expense		53,348			-
Changes in operating assets and liabilities
Accounts receivable		1,686			(401,777	)
Prepaid expenses		(10,576	)		(72,710	)
Inventory		(385,551	)		(197,663	)
Accounts payable & accrued expenses		117,304			21,818
Customer deposits		11,553			57,778
Net cash used in operating activities		(854,003	)		(743,730	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of fixed assets		(63,564	)		(80,483	)
Proceeds from sale of assets		50,218			-
Net cash used in investing activities		(13,346	)		(80,483	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from sale of common stock		-			795,000
Repayment of advances from third parties		(187	)		(106,340	)
Proceeds from advances from related parties		322,411			226,750
Repayment of loans from related party		(10,000	)		(260	)
Proceeds from loans from related parties		445,000			-
Net cash provided by financing activities		757,224			915,150
(DECREASE) INCREASE IN CASH		(110,125	)		90,937
CASH, BEGINNING OF PERIOD		116,481			40,507
CASH, END OF PERIOD	$	6,356		$	131,444
Cash Paid during the period		9,000			-
Supplemental Disclosures
Non-cash investing and financing activities:
Common Stock and Warrants issued for Conversion of Debt and Advances	$	75,000		$	324,372
Related party advance paid directly to vendor		125,000			-
Purchase of building with a note					225,000
Transfer of building to related party in exchange for payment of loan	$	225,000		$	-

(Unaudited)

										Total
					Additional					Stockholders'
	Common Stock				Paid in		Accumulated			Equity
	Shares		Amount		Capital		Deficit			(Deficit)
Balance at January 1, 2019		236,724,960	$	23,672	$	14,220,537	$	(16,142,976	)	$	(1,898,767	)

Stock based compensation		-		-		90,183		-			90,183

Shares issued for compensation		20,000,000		2,000		1,798,000		-			1,800,000

Net loss		-		-		-		(2,093,364	)		(2,093,364	)

Balance at March 31, 2019		256,724,960	$	25,672	$	16,108,720	$	(18,236,340	)	$	(2,101,948	)

										Total
					Additional					Stockholders'
	Common Stock				Paid in		Accumulated			Equity
	Shares		Amount		Capital		Deficit			(Deficit)
Balance at January 1, 2018		230,724,960	$	23,072	$	12,444,488	$	(12,439,218	)	$	28,342

Options issued for services		-		-		771,129		-			771,129

Shares issued for services		5,000,000		500		50,741		-			51,241

Net loss		-		-		-		(1,092,567	)		(1,092,567	)

Balance at March 31, 2018		235,724,960	$	23,572	$	13,266,358	$	(13,531,785	)	$	(241,855	)

The accompanying notes are an integral part of these condensed consolidated financial statements.

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ZNERGY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	For the Three Months Ended
	March 31,			March 31,
	2019			2018
Cash flows from operating activities:
Net loss	$	(2,093,364	)	$	(1,092,567	)
Adjustments to reconcile net loss to net cash
used in operating activities:
Depreciation and amortization		7,085			7,830
Loss on sale of fixed assets		-			29,739
Non-cash interest expense		15,375			105,560
Stock and stock-based compensation for services		1,890,183			771,629
Changes in operating assets and liabilities:
Accounts receivable		(13,522	)		(82,697	)
Prepaid expenses		(31,003	)		(6,341	)
Inventory		(54,004	)		(25,262	)
Accounts payable and accrued expenses		55,190			(216,400	)
Customer deposits		185,683			3,616
Net cash used in operating activities		(38,377	)		(504,893	)

Cash flows from investing activities:
Purchase of fixed assets		-			(10,086	)
Net cash used in investing activities		-			(10,086	)

Cash flows from financing activities:
Repayment of advances from related parties		(2,000	)		-
Proceeds of advances from related parties		50,000			445,000
Proceeds of loan from related parties		5,000			-
Net cash provided by financing activities		53,000			445,000

(Decrease) increase in cash		14,623			(69,979	)
Cash, beginning of period		593			116,481
Cash, end of period	$	15,216		$	46,502

Supplemental disclosures of cash flow information:
Non-cash investing and financing activities:
Transfer of building to related party in exchange for payment of loan	$	-		$	225,000

The accompanying notes are an integral part of these condensed consolidated financial statements.

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ZNERGY, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

PERIODS ENDED ~~SEPTEMBER~~MARCH 3031, ~~2018~~2019 AND ~~2017~~2018

NOTE 1 –- NATURE OF BUSINESS AND BASIS OF PRESENTATION

Znergy, Inc., (formerly Mazzal Holding Corp., formerly Boston Investment and Development Corp.) is a Nevada corporation (the “Company” or “Znergy”), incorporated on January 23, 2013. The ~~original~~Company ~~business~~is ~~plan~~a provider of ~~the~~energy-efficient ~~Company~~lighting ~~was~~products, ~~the~~lighting ~~construction~~controls and energy management ofsolutions. ~~multi~~The Company offers a full turn-~~family~~key ~~home~~lighting ~~developments~~solution which includes economic assessments, energy efficient analysis, installation and rebate support for the ~~subsequent~~Company’s ~~sale~~customers. ~~thereof~~The Company’s business primarily involves retrofitting existing lighting solutions from traditional high intensity and metal halide fluorescent lighting to energy efficient LED (Light Emitting Diode) technology.

OnThe ~~October~~spread ~~26,~~of ~~2015~~a ~~the~~novel ~~Company~~strain ~~acquired~~of ~~Global~~coronavirus ~~ITS,~~(COVID-19) ~~Inc.~~around ~~and~~the ~~its~~world ~~wholly owned subsidiary, Znergy, Inc.~~ in ~~order~~the tofirst ~~expand~~half ~~into~~of ~~the~~2020 ~~Energy~~has ~~Efficiency~~caused ~~(EE)~~significant ~~marketplace,~~volatility ~~focusing~~in onU.S. ~~commercial lighting~~ and ~~green~~international ~~project financing~~markets. OnThere ~~February~~is 9,significant ~~2016,~~uncertainty ~~the~~around ~~Company agreed to sell to~~ the ~~Mazzal~~breadth ~~Trust~~and ~~the~~duration ~~real~~of ~~property~~business ~~which~~disruptions ~~the~~related ~~Trust had previously sold~~ to ~~the Company and the Trust returned to the Company 149~~COVID-19,~~950,000~~ ofas ~~the~~well ~~150,000,000~~as ~~shares~~its ofimpact ~~the~~on ~~Company’s common stock owned by~~ the ~~Trust~~U. ~~This~~S. ~~transaction~~and ~~caused~~international aeconomies ~~change~~and, ofas ~~control~~such, ~~with Global being~~ the ~~accounting acquirer. The~~ Company is ~~now~~unable ~~focused~~to ~~solely~~determine onif ~~the~~it EEwill ~~marketplace~~have ~~with~~a anmaterial ~~emphasis~~impact onto ~~LED~~its ~~retrofitting and installing new lamps~~operations.

The Company ~~determined~~is ~~that~~unsure ~~Global~~of ~~ITS,~~the ~~Inc~~outcome of the COVID-19 novel Coronavirus pandemic on its business. ~~served~~The noduration ~~purpose~~of ~~for~~the pandemic, its effect on business in general and its effect on the Company specifically are unknown to management. It ~~held~~For noexample, ~~assets~~the orCompany’s ~~operations~~largest client, ~~had~~one ~~been~~of ~~dormant~~the ~~for~~world’s ~~over~~largest aclothing ~~year~~retail stores, ~~except~~was ~~fot~~forced to close its doors at the ~~operations~~onset of the pandemic and only recently re-opened some of its ~~wholly~~stores, ~~owned~~thereby ~~Subsidiary~~allowing the Company to continue to retrofit these limited stores with its LED lighting system. On ~~October~~We 1were able to convert 27 stores starting November 26, ~~2017~~2019 through November 20, 2020, with the ~~Company~~majority ~~sold~~converted ~~100%~~in the first quarter of ~~its~~2020 ~~shares~~before inthe ~~Global~~full impact of the pandemic. The expectation is that by the last two quarters of 2021, this retailer will have opened more stores, allowing for the LED retrofit to ~~Peter~~move ~~Peterson~~forward. A continuation of the pandemic, a ~~shareholder~~second surge of the ~~Company~~pandemic, ~~and~~or a ~~creditor~~failure ofto ~~Global~~find ~~for~~and commercialize a ~~nominal~~vaccine ~~amount.~~for ~~The~~COVID-19 ~~sale~~could ~~did~~materially ~~not~~impact ~~include~~the ~~Global~~Company’s ~~investment~~revenues inand its ~~subsidiary~~operations.

The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. Significant intercompany accounts and transactions have been eliminated in consolidation.

Basis of Presentation

The unaudited condensed consolidated financial statements of the Company for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2018~~2019 and ~~2017~~2018 have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and pursuant to the requirements for reporting on Form 10-Q and Article 8 of Regulation S-X of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all the information and footnotes required by GAAP for complete financial statements. However, such information reflects all adjustments (consisting solely of normal recurring adjustments), which are, in the opinion of management, necessary for the fair presentation of the Company’'s financial position and the results of operations. Results shown for interim periods ended March 31, 2019 are not necessarily indicative of the results to be obtained for a full fiscal year. The balance sheet information as of December 31, ~~2017~~2018 was derived from the audited consolidated financial statements included in the Company’'s Annual Report on Form 10-K filed with the SEC on ~~June~~September 64, ~~2018~~2020. These financial statements should be read in conjunction with that report.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that 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 or revenues and expenses during the reporting period. Actual results could differ from those estimates. The Company’s significant estimates, judgments, and assumptions used in these consolidated financial statements include those related to revenues, accounts receivable and related allowances, contingencies, and the fair values of stock-based compensation. These estimates, judgments, and assumptions are reviewed periodically and the effects of material revisions in estimates are reflected in the financial statements prospectively from the date of the change in estimate.

Revenue Recognition

The Company accounts for revenue in accordance with ASC 606-10. The Company generally has two revenue sources –- installation contracts and sales of lighting products. The installation contracts are short term in duration, typically within a week. The disaggregation of revenue for the three months ended ~~September~~March 3031, ~~2018~~2019 was $~~528~~160,~~715~~768 and $2725,~~427~~850 for installation contracts and sale of lighting products, respectively. For the ~~nine~~three months ended ~~September~~March 3031, 2018, the amounts were $1408,~~212,428~~437 and $8624,~~268~~095 for installation contracts and sale of lighting products, respectively.

When Znergy receives an order from a customer, either verbally or through a written purchase order for products such as individual lights or fixtures, but is not part of an installation contract, the Company recognizes the revenue when the goods are shipped, and title has passed to the customer. In these arrangements, we have determined that there is one performance obligation and that revenue should be recognized at the point in time that title passes to the customer. 9

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~~Installation~~When ~~contract~~Znergy ~~revenue~~receives isan ~~recognized~~order ~~when~~from ~~the~~a ~~contract~~customer, iseither ~~considered~~verbally ~~complete~~or ~~by the customer,~~ through a written ~~customer~~purchase ~~acceptance~~order ~~form. Each~~for ~~contract~~products ~~for~~such ~~installation~~as ofindividual ~~lighting~~lights ~~and~~or fixtures, ~~consists~~but ~~of labor and materials, and~~ is ~~given~~not apart ~~unique~~of ~~number~~an ininstallation ~~the system. Each~~ contract ~~is accounted for individually. The Company identifies the performance obligations~~, ~~which include labor and materials and are accounted for as one contract. The transaction price is identified in advance with an agreed proposal between~~ the Company ~~and~~recognizes the ~~customer~~revenue ~~and~~when the ~~price~~goods ~~can be adjusted if, during the installation process, changes~~ are ~~made during the process. Under this method~~shipped, ~~contract costs are accumulated as deferred assets~~ and ~~billings~~title ~~and/or~~has ~~cash~~passed ~~receipts are recorded~~ to ~~a deferred revenue liability account during~~ the ~~contract period, but no revenues, costs, or profits are recognized in operations until the completion of the contract~~customer. In ~~Costs~~these ~~include direct material~~arrangements, ~~direct~~we ~~labor,~~have ~~subcontract~~determined ~~labor,~~that ~~and~~there ~~allocable~~is ~~indirect~~one ~~costs.~~performance ~~All~~obligation ~~unallocated indirect costs~~ and ~~corporate~~that ~~general~~revenue ~~and~~should ~~administrative~~be ~~costs~~recognized ~~are~~at ~~charged in~~ the ~~periods~~point ~~as incurred. However,~~ in ~~the~~time ~~event~~that atitle ~~loss~~passes onto ~~a contract is foreseen,~~ the ~~Company will recognize the loss when such loss is determined. A contract is considered complete when accepted by the~~ customer ~~that the Company has satisfied its performance obligations~~. ~~In the third quarter there were no contracts which were not complete by the end of the third quarter.~~

Installation contract revenue is recognized when the contract is considered complete by the customer, through a written customer acceptance form. Each contract for installation of lighting and fixtures, consists of labor and materials, and is given a unique number in the system. Each contract is accounted for individually. The Company identifies the performance obligations, which include labor and materials and are accounted for as one contract. The transaction price is identified in advance with an agreed proposal between the Company and the customer and the price can be adjusted if, during the installation process, changes are made during the process. Under this method, contract costs are accumulated as deferred assets and billings and/or cash receipts are recorded to a deferred revenue liability account during the contract period, but no revenues, costs, or profits are recognized in operations until the completion of the contract. Costs include direct material, direct labor, subcontract labor, and allocable indirect costs. All unallocated indirect costs and corporate general and administrative costs are charged in the periods as incurred. However, in the event a loss on a contract is foreseen, the Company will recognize the loss when such loss is determined. A contract is considered complete when accepted by the customer that the Company has satisfied its performance obligations. There were no contracts which were not complete by the end of the quarter.

Consolidation

The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, Znergy (FL) and Znergy Holdings (FL). All intercompany transactions have been eliminated in consolidation.

Inventory

Inventory consists of a variety of LED lamps, all of which are valued at the lower of cost or net realizable value. Inventory is accounted for using the FIFO basis.

Adoption of recent accounting standards

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606). The guidance in this ASU requires entities to recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company has adopted Topic 606 as of January 1, 2018 utilizing the full retrospective method of adoption. The adoption of Topic 606 did not have any impact on its results of operations and financial condition.

In ~~May~~February ~~2017~~2016, the FASB issued ASU No. ~~2017~~2016-0902, ~~Compensation–Stock~~Leases, ~~Compensation~~which ~~(Topic~~supersedes ~~718):~~the ~~Scope~~current oflease ~~Modification~~accounting ~~Accounting,~~requirements. ~~clarifying~~This ~~when~~standard requires a ~~change~~lessee to record on the ~~terms~~balance orsheet ~~conditions~~the assets and liabilities for the rights and obligations created by leases with lease terms of amore ~~share-based~~than 12 months. In addition, this standard requires lessees to disclose certain key information about lease transactions. Upon implementation, an entity’s lease payment ~~award~~obligations ~~must~~will be ~~accounted~~recognized ~~for~~at astheir estimated present value along with a ~~modification~~corresponding right-of-use asset. ~~The~~Lease ~~new~~expense ~~guidance~~recognition ~~requires~~will ~~modification~~be ~~accounting~~generally ifconsistent with current practice. In July 2018, the ~~fair~~FASB ~~value~~issued ASU No. 2018-11, ~~vesting~~Leases ~~condition~~(Topic or842): ~~the~~Targeted ~~classification~~Improvements, which simplifies adoption of the ~~award~~new islease ~~not~~accounting ~~the~~requirements ~~same~~by ~~immediately~~allowing ~~before~~an ~~and~~additional ~~after~~transition amethod ~~change~~that towill ~~the~~not ~~terms~~require ~~and~~restatement ~~conditions~~ of ~~the~~prior ~~award.~~periods ~~The~~and ~~new~~providing ~~guidance~~a isnew ~~effective~~practical expedient for ~~the~~lessors ~~Company~~to onavoid aseparating ~~prospective~~lease ~~basis~~and ~~beginning~~non-lease oncomponents ~~January~~within 1,a ~~2018,~~contract ~~with~~if ~~early~~certain ~~adoption~~requirements ~~permitted~~are met. The ~~adoption~~provisions of this ~~update~~guidance ~~did~~must ~~not~~be ~~have~~elected aupon ~~material~~adoption ~~impact~~of onthe ~~its~~new ~~financial~~lease ~~position~~accounting requirements, ~~results~~which ofwill ~~operations~~be oreffective ~~financial~~for ~~statement~~interim ~~disclosure~~and annual periods beginning after December 15, 2018.

We adopted the standard as required on January 1, 2019. Consequently, we did not update previously reported financial information and the disclosures under the new standard will not be provided for dates and periods prior to January 1, 2019 and elected all of the practical expedients available under the transition guidance. The new standard also provides practical expedients for ongoing accounting. We elected the short-term lease recognition exemption for all leases that qualify, and did not recognize right of use assets or lease liabilities for those leases. We also elected the practical expedient to not separate lease and non-lease components for all of our leases.

The adoption did not impact the business as no long-term, reportable leases existed as of March 31, 2019. We do not expect that this standard will have a material impact on our financial statements. While we continue to assess all of the effects of adoption, we currently believe the most significant effects relate to the recognition of new right of use assets and lease liabilities on our balance sheet for our real estate and equipment operating leases, and the significant new required disclosures regarding our leasing activities. We do not expect a significant change in our leasing activities between now and adoption.

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Recent accounting standards

In ~~June~~April ~~2018~~2019, the FASB issued ASU No. ~~2018~~ 2019-~~07,~~04 ~~Compensation~~“Codification –Improvements ~~Stock~~to ~~Compensation (~~Topic ~~718):~~326, ~~Improvements~~Financial toInstruments ~~Nonemployee~~— ~~Share-Based~~Credit ~~Payment~~Losses, ~~Accounting.~~Topic ~~The~~815, ~~guidance~~Derivatives inand ~~this~~Hedging, ~~ASU~~and ~~expands~~Topic ~~the~~825, ~~scope~~Financial ofInstruments”, ~~ASC~~which ~~Topic~~provides ~~718~~updates toand ~~include~~clarifications ~~all~~to ~~share~~three previously-~~based~~issued ~~payment~~ASUs: ~~arrangements~~2016-01, ~~related~~“Financial toInstruments ~~the~~- ~~acquisition~~Overall of(Subtopic ~~goods~~825-10): Recognition and ~~services~~Measurement ~~from~~of ~~both~~Financial ~~nonemployees~~Assets and ~~employees.~~Financial ~~This~~Liabilities”; ~~amendment~~2016-13, ~~will~~“Financial beInstruments ~~effective~~— ~~for~~Credit ~~annual~~Losses ~~and~~(Topic ~~interim~~326): ~~periods~~Measurement ~~beginning~~of ~~after~~Credit ~~December~~Losses 31on Financial Instruments”; and 2017-12, ~~2018.~~“Derivatives ~~The~~and ~~Company~~Hedging is(Topic ~~currently~~815): ~~evaluating~~Targeted ~~the~~Improvements ~~impact~~to ~~ASU~~Accounting Nofor Hedging Activities”. ~~2018-07~~The ~~will~~adoption ~~have~~of onthis ~~its~~standards ~~financial~~update ~~position,~~is ~~results~~not ofexpected ~~operations~~to orhave ~~financial~~a ~~statement~~material ~~disclosure~~impact on the Company’s financial statements.

In ~~February~~December ~~2016~~2019, the FASB issued ASU ~~No. 2016~~2019-0212, ~~Leases~~“Income Taxes (Topic ~~842~~740). ~~This~~- ~~ASU~~Simplifying ~~will require lessees to recognize a right of use asset and lease liability on~~ the ~~balance~~Accounting ~~sheet~~ for ~~leases~~Income ~~with terms longer than 12 months~~Taxes”. ~~Leases~~This ~~will~~ASU besimplifies ~~classified~~the asaccounting ~~either~~for ~~finance~~income ortaxes ~~operating,~~by ~~with~~removing ~~classification~~certain ~~affecting~~exceptions to the ~~pattern~~general ofprinciples ~~expense recognition~~ in ~~the~~Topic ~~income statement~~740. The ~~amendment~~guidance ~~will~~is be effective ~~for~~non-public ~~annual~~entities ~~and~~for ~~interim~~fiscal ~~periods~~years beginning after December 15, ~~2018~~2020, ~~including~~with ~~interim~~early ~~periods~~adoption ~~within~~permitted. ~~those~~The ~~fiscal~~adoption ~~years.~~method Inis ~~July~~dependent ~~2018,~~on the ~~FASB~~specific ~~issued~~amendment ~~ASU~~included ~~No.~~in ~~2018-10,~~this ~~Codification~~update ~~Improvements~~as tocertain ~~Topic~~amendments ~~842,~~require ~~Leases~~retrospective ~~and~~adoption, ~~ASU~~modified ~~No.~~retrospective ~~2018-11~~adoption, ~~Leases~~an ~~(Topic~~option ~~842): Targeted Improvements. ASU No. 2018-10 provides certain amendments that affect narrow aspects~~ of ~~the~~retrospective ~~guidance~~or ~~issued~~modified inretrospective, ~~ASU~~and ~~No.~~prospective ~~2016-02~~adoption. ~~ASU~~The ~~No. 2018-11 allows entities the option to prospectively apply the new lease standard at the~~ adoption ~~date instead~~ of ~~recording~~this ~~the~~standards ~~cumulative~~update ~~impact~~is ofnot ~~all~~expected ~~comparative~~to ~~reporting~~have ~~periods~~a ~~presented~~material ~~within retained earnings. The Company is currently evaluating the~~ impact ~~ASU No. 2016-02, ASU No. 2018-10 and ASU No. 2018-11 will have~~ on ~~its~~the ~~financial~~Company’s ~~position, results of operations or~~ financial ~~statement disclosure~~statements.

~~NOTE~~In 2August –2020, ~~GOING~~the ~~CONCERN~~FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging— Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. This ASU amends the guidance on convertible instruments and the derivatives scope exception for contracts in an entity’s own equity and improves and amends the related EPS guidance for both Subtopics. The ASU will be effective for annual reporting periods after December 15, 2023 and interim periods within those annual periods and early adoption is permitted in annual reporting periods ending after December 15, 2020. We are still assessing the impact of ASU 2020-06 on our condensed consolidated financial statements

The ~~accompanying~~Company ~~condensed~~does ~~consolidated~~not ~~financial~~believe ~~statements have been prepared assuming~~ that ~~the~~there ~~Company~~are ~~will~~any ~~continue~~new asaccounting apronouncements ~~going~~that ~~concern,~~have ~~which~~been ~~contemplates~~issued ~~the~~that ~~realization~~might ofhave ~~assets and the liquidation of liabilities in the normal course of business. As of September 30, 2018, the Company had~~ a ~~working~~material ~~capital~~impact ~~deficit~~on ~~of $890,620, insufficient cash resources to meet~~ its ~~planned~~financial ~~business~~position ~~objectives,~~or ~~and~~results ~~accumulated losses~~ of ~~$14,507,419 The Company intends to fund~~ operations through equity and debt financing arrangements, which may be insufficient to fund its capital expenditures, working capital and other cash requirements through a year from the date these financial statements are available to be issued. ~~As a result, the Company is seeking additional funding through debt and equity financing arrangements, or other funding opportunities.~~

9NOTE 3 - GOING CONCERN

The accompanying condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. As of March 31, 2019, the Company has a working capital deficit of $2,123,215, insufficient cash resources to meet its planned business objectives and recurring losses of ($2,093,364) and ($1,092,567) in the three months ended March 31, 2019 and March 31, 2018 respectively. The Company intends to fund operations through debt and equity financing arrangements, which may be insufficient to fund its capital expenditures, working capital and other cash requirements through July 2022, one year from the date the consolidated financial statements were issued.

The Company is dependent upon, among other things, obtaining additional financing to continue operations and to execute its business plan. In response to these problems, management intends to raise additional funds through public or private placement offerings. No assurances can be made that management will be successful in pursuing any of these strategies.

These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern for the next twelve months from the date these consolidated financial statements were issued. The accompanying consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

NOTE 4 - BUILDING, EQUIPMENT AND FURNITURE, NET

Building, furniture and equipment were comprised of the following:

	March 31			December 31
	2019			2018
Equipment and Furniture	$	59,609		$	59,609
Accumulated Depreciation		(38,342	)		(31,257	)
Net	$	21,267		$	28,352

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~~The~~Depreciation ~~Company’s~~included ~~success~~in ~~is dependent upon~~Selling, ~~among~~general ~~other things, obtaining the additional financing to continue operations~~ and toadministrative ~~execute its business plan. No assurances can be made that management will be successful in pursuing its business plan.~~expenses:

These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

	March 31		March 31
	2019		2018

Depreciation Expense	$	7,085	$	7,830

NOTE 5 3- –ADVANCES ~~BUILDING,~~FROM ~~EQUIPMENT~~RELATED ~~AND FURNITURE, NET~~PARTIES

OnAdvances ~~July~~from ~~22,~~related ~~2017,~~parties ~~the~~were ~~Company~~comprised ~~entered into a purchase agreement for a property located at 808A South Huntington Street, Syracuse, Indiana. The purchase price was $255,000~~ of ~~which $30,000 was paid on July 22, 2017 with~~ the ~~balance of $225,000 due 180 days after closing. There was no interest accruing on the debt. The Company closed on the property on September 1, 2017.~~following:

On March 9, 2018, the Company settled the outstanding mortgage through a sale of the building to the Company’s chairman, Rick Mikles who purchased the building for the balance of the mortgage of $225,000, as the Company was unable to make the scheduled $225,000 payment. On March 16th, a quitclaim was recorded to Rick Mikles as the new owner of the building. The Company recorded a loss on the sale of $43,488, representing the difference between the carrying value and the mortgage balance assumed by the Company’s chairman.

	March 31		December 31
	2019		2018
B2 Opportunity Fund	$	154,788	$	154,788
Other		116,000		68,000
	$	270,788	$	222,788

~~NOTE 4–~~During ~~ADVANCES~~the three months ended March 31, 2019, the Company received an aggregate of $50,000 of short-term advances from Cary Baskin and paid $2,000 of short-term advances to Eco Energy. The amounts are non-interest bearing and payable on demand.

	September 30, 2018		December 31, 2017
R. Mikles	$	167,436	$	0
B2 Opportunity Fund		154,788		0
	$	322,224	$	0

Since March 31, 2019, through the filing date of this report the Company has received $0 in additional advances to fund operations.

~~During~~NOTE 6 ~~the nine months ended September 30, 2018, the Company received an aggregate of $167,436 of short~~-~~term~~ ~~advance~~LOANS ~~from~~FROM ~~its~~RELATED ~~Chairman, Rick Mikles. The amounts are non-interest bearing and payable on demand.~~PARTIES

OnThe ~~April~~table ~~20,~~below ~~2018,~~sets ~~the~~forth ~~Company received $125,000 as~~ a ~~short-term~~summary ~~advance~~of ~~from an investor, B2 Opportunity Fund, via a payment to a vendor on~~ the Company’s ~~behalf.~~loans Onfrom ~~June~~related 5,parties ~~2018~~at March ~~the Company received an additional $29~~31,~~975~~ ~~in cash as an additional short-term advance. These advances were offset by $187 of repayments to the investor. Currently the advances are non-interest bearing~~ 2019 and December ~~payable~~31, ~~on demand.~~2018:

On June 20, 2018, the Company received $75,000 as a short-term advance from an investor, Gary Cook, an unrelated party. Currently the advance is non-interest bearing and payable on demand and does not accrue interest. The advance was converted to 1,000,000 shares of common stock and 1,000,000 warrants. The advance was converted at fair value on the date of the conversion. The fair value of the warrants was not material.

	March 31		December 31
	2019		2018
Rick Mikles	$	520,329	$	514,579
Wayne Miller		656,700		642,075
Paul Ladd		58,650		58,650
Cary Baskin		75,000		75,000
	$	1,310,679	$	1,290,304

~~Since~~Rick ~~September 30, 2018, through the filing date of this report the Company has received $171,000 in additional advances to fund operations.~~Mikles

~~NOTE 5~~On –November ~~LOANS~~15, ~~FROM~~2017, ~~RELATED~~the ~~PARTIES~~Company executed an unsecured promissory note in the amount of $50,000, payable to the Company’s chairman, Rick Mikles. The note was payable on December 1, 2017 with interest at 4% per annum. On December 1, 2017, the payment date was extended to June 1, 2018. The balance remains outstanding.

	September 30, 2018		December 31, 2017
R. Mikles	$	312,329	$	47,248
W. Miller		358,450		124,270
P. Ladd		58,650		0
	$	729,429	$	171,518

On February 15, 2018, the Company executed a promissory note in the amount of $25,000 payable to Rick Mikles, the Company’s Chairman. The note was due and payable on June 1, 2018 together with interest at 4% per annum. Pursuant to the terms of the note, if the note and accrued interest is not paid by the due date, interest at 12% per annum shall be accrued on the outstanding balance until paid in full. The balance at December 31, 2018 was $27,125 which includes unpaid interest.

10On March 2, 2018, the Company executed an unsecured promissory note in the amount of $200,000 payable to Rick Mikles, the Company’s Chairman. The note was due on June 1, 2018 together with interest of $2,500. Pursuant to the terms of the note, there was a 15-day grace period, which ended on June 16, 2018 at which time a 15% penalty of the unpaid balance became due and payable together with the unpaid principal and accrued interest. The balance at December 31, 2018 was $475,000, which includes unpaid interest and penalties.

During the year ended December 31, 2018, the Company received various loans from the Company’s chairman, Rick Mikles, with a balance of $200,000 as of December 31, 2018. These loans were non-interest bearing and payment is due on demand.

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OnAccrued January 8, 2018, the Company executed an unsecured promissory note in the amount of $150,000 payable to Mr. Wayne Miller, a shareholder of the Company. The note was due and payable on April 8, 2018, with interest ofincurred ~~$6,000. Pursuant to the terms of the note, there was a 15-day grace period, which ended~~ on ~~April 23, 2018 at which time a 15% penalty of~~ the ~~unpaid~~outstanding ~~balance~~loans ~~became due and payable together with the unpaid principal and accrued interest. Prior~~ to the ~~end~~chairman offor the ~~grace~~three ~~period~~months ~~the~~ended ~~Company~~March ~~paid $3~~31,~~000~~ in2019 ~~interest and $10,000 in principle. The balance at September 30, 2018~~ was $~~175~~5,~~950, which includes unpaid principal, interest, and penalties~~750. As of the date of this Report, no further payments had been made. Under the note agreement, the Company issued warrants to purchase 1,000,000 shares at an exercise price of $0.15 per share. The warrants expire on the first anniversary date of the initial exercise date of the warrants.

OnSince ~~February~~March 1531, ~~2018~~2019, through the ~~Company~~filing ~~executed~~date aof ~~promissory~~this ~~note~~report in the ~~amount~~company ofhas received $25496,000 ~~payable~~in toadditional ~~Rick~~loans ~~Mikles,~~from ~~the~~Mr. ~~Company’s Chairman and secured by the Company’s inventory~~Mikles. The ~~note~~notes ~~was~~bear ~~due and payable on June 1, 2018 together with~~ interest at 410% ~~per annum~~. ~~Pursuant~~In toFebruary ~~the~~2021 ~~terms of~~ the ~~note,~~Company ~~if the note~~ and ~~accrued~~Mr. ~~interest~~Mikles isagreed ~~not~~to ~~paid~~consolidate byall ~~the~~outstanding ~~due~~debt ~~date,~~and ~~interest at 12% per annum shall be~~ accrued oninterest ~~the~~into ~~outstanding~~a ~~balance~~single ~~until~~Note ~~paid~~ in ~~full.~~the ~~The~~amount ~~balance~~of ~~at September 30, 2018 was~~ $26928,~~375 which includes unpaid interest~~238. As ofThe ~~the~~Note ~~date~~is ofpayable ~~this~~upon ~~Report, the note and accrued interest remain unpaid~~demand.

OnWayne March 2, 2018, the Company executed an unsecured promissory note in the amount of $200,000 payable to Rick Mikles, the Company’s Chairman. The note was due on June 1, 2018 together with interest of $2,500. Pursuant to the terms of the note, there was a 15-day grace period, which ended on June 16, 2018 at which time a 15% penalty of the unpaid balance became due and payable together with the unpaid principal and accrued interest. The balance at September 30, 2018 was $232,875 which includes unpaid interest and penalties. As of the date of this Report, the note, accrued interest, and penalties remain unpaid.Miller

On ~~March~~November 2227, ~~2018~~2017, the Company executed an unsecured promissory note in the amount of $50200,000, payable to ~~Paul~~Mr. ~~Ladd~~Wayne Miller, a shareholder of the Company. The note was due and payable with interest of $2,000 on ~~May~~December 2131, ~~2018~~2017. ~~together~~The note was repaid in full, with interest ofon $1December 22,~~000~~ 2017. ~~Pursuant~~ toUnder the ~~terms~~note ofagreement, the ~~note~~Company issued warrants to purchase 1,000,000 ~~there~~shares ~~was~~at aan exercise price of $0.15~~-day~~ ~~grace~~per ~~period,~~share. ~~which~~The ~~ended~~warrants expired on ~~June~~the 4,first ~~2018~~anniversary atdate ~~which~~of ~~time~~the ainitial ~~15%~~exercise ~~penalty~~date of the ~~unpaid~~warrants. ~~balance~~The ~~became~~Company ~~due~~evaluated ~~and~~the ~~payable~~warrants ~~together~~in accordance with ~~the~~ASC ~~unpaid~~Topic ~~principal~~No. ~~and~~815 ~~accrued~~- ~~interest.~~40, Derivatives ~~The~~and ~~balance~~Hedging at– ~~September~~Contracts ~~30,~~in ~~2018~~Entity’s ~~was~~Own ~~$58,650~~Stock and ~~which~~determined ~~includes~~that the ~~unpaid~~warrants ~~principal,~~did ~~interest,~~not ~~and~~meet ~~penalties.~~the Asdefinition of ~~the~~a ~~date~~liability ofand ~~this~~therefore ~~Report,~~did ~~the~~not ~~note,~~account ~~accrued~~for ~~interest,~~them ~~and~~as ~~penalties~~a ~~remain~~separate ~~unpaid~~derivative liability. ~~Under~~The ~~the~~fair ~~note~~value ~~agreement,~~of the ~~Company~~warrants ~~issued~~was ~~warrants~~calculated tousing ~~purchase~~the ~~50,000~~Black-Sholes ~~shares~~model atamounting anto ~~exercise~~$55,072, ~~price~~and ofwas ~~$0.15~~recorded ~~per~~as ~~share. The~~a ~~warrants~~debt ~~expire~~discount onand ~~the~~amortized ~~first~~over ~~anniversary~~the ~~date~~term of the ~~initial~~note. ~~exercise~~As ~~date~~ of December 31, 2017, the ~~warrants~~debt discount was fully amortized.

On ~~March~~December 226, ~~2018~~2017, the Company ~~also~~executed ~~borrowed~~an ~~$20,000~~unsecured promissory note in athe ~~non-interest~~amount ~~bearing~~of ~~short-term~~$150,000 payable to Mr. Wayne Miller, a shareholder of the Company. The ~~balance~~note aswas ofdue ~~September~~and 30payable on March 12, 2018, iswith interest of $106,000. ~~There~~Under isthe nonote ~~formal~~agreement, ~~promissory~~the Company issued warrants to purchase 1,000,000 shares at an exercise price of $0.15 per share. The warrants expire on the first anniversary date of the initial exercise date of the warrants. The Company evaluated the warrants in accordance with ASC Topic No. 815 - 40, Derivatives and Hedging – Contracts in Entity’s Own Stock and determined that the warrants did not meet the definition of a liability and therefore did not account for them as a separate derivative liability. The fair value of the warrants was calculated using the Black-Sholes model amounting to $42,345, and was recorded as a debt discount and amortized over the term of the note. As of December 31, 2018, the debt discount was fully amortized and ~~payment~~the isprincipal ~~due~~balance of the note remains unpaid. Pursuant to the terms of the note, there was a 15-day grace period granted, which ended on ~~demand~~March 27, 2018, at which a 15% penalty on the unpaid balance became due and payable along with the unpaid principal and any accrued interest.

~~Since~~On ~~September~~January 308, 2018, ~~through~~the Company executed an unsecured promissory note in the ~~filing~~amount ~~date~~of $150,000 payable to Mr. Wayne Miller, a shareholder of ~~this~~the ~~report~~Company. The note was due and payable on April 8, 2018, with interest of $6,000. Pursuant to the ~~company~~terms ~~has~~of ~~received~~the note, there was a 15-day grace period, which ended on April 23, 2018 at which time a 15% penalty of the unpaid balance became due and payable together with the unpaid principal December 31, 2018 was $~~450~~179,700, which includes unpaid principal, interest, and penalties. Under the note agreement, the Company issued warrants to purchase 1,000,000 shares at an exercise price of $0.15 per share. The warrants expire on the first anniversary date of the initial exercise date of the warrants. The Company evaluated the warrants in ~~additional~~accordance ~~loans~~with ~~from~~ASC ~~related~~Topic ~~parties~~No. 815 - 40, Derivatives and Hedging – Contracts in Entity’s Own Stock and determined that the warrants did not meet the definition of a liability and therefore did not account for them as a separate derivative liability. The ~~notes~~fair ~~bear~~value ~~interest~~of atthe ~~10%~~warrants was calculated using the Black-Sholes model amounting to $47,867, and was recorded as a debt discount and amortized over the term of the note. As of December 31, 2018, the debt discount was fully amortized and the principal balance of the note remains unpaid.

~~NOTE 6~~On –March ~~STOCKHOLDERS’~~22, ~~EQUITY~~2018, the Company executed an unsecured promissory note in the amount of $20,000 payable to Mr. Wayne Miller, a shareholder of the Company. The note has interest at accruing at 10% per annum. The balance at December 31, 2018 was $10,250 which includes unpaid interest.

On October 4, 2018, the Company also borrowed $275,000 short-term payable to Wayne Miller. The balance as of December 31, 2018 is $281,875 which includes the unpaid principal and interest. This loan was due on April 3, 2019.

During the three months ended March 31, 2019, the Company executed additional loans to Mr. Miller. The accrued interest for the period were $14,625 and $7,750 respectively.

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Paul Ladd

On March 22, 2018, the Company executed an unsecured promissory note in the amount of $50,000 payable to Paul Ladd, a shareholder. The note was due and payable on May 21, 2018 together with interest of $1,000. Pursuant to the terms of the note, there was a 15-day grace period, which ended on June 4, 2018 at which time a 15% penalty of the unpaid balance became due and payable together with the unpaid principal and accrued interest. The balance at December31, 2018 was $58,650 which includes the unpaid principal, interest, and penalties. Under the note agreement, the Company issued warrants to purchase 50,000 shares at an exercise price of $0.15 per share. The warrants expire on the first anniversary date of the initial exercise date of the warrants. The Company evaluated the warrants in accordance with ASC Topic No. 815 - 40, Derivatives and Hedging – Contracts in Entity’s Own Stock and determined that the warrants did not meet the definition of a liability and therefore did not account for them as a separate derivative liability. The fair value of the warrants was calculated using the Black-Sholes model amounting to $2,875, and was recorded as a debt discount and amortized over the term of the note. As of December 31, 2018, the debt discount was fully amortized and the principal balance of the note remains unpaid.

Cary Baskin

On October 23, 2018, the Company also borrowed $75,000 in a non-interest bearing short-term payable to Cary Baskin, and was secured by shares owned by the Company’s CEO. The balance as of December 31, 2018 is $75,000. This loan was due on December 31, 2018.

Total interest expense under the related party loans was $15,375 and $33,059 as of March 31, 2019 and March 31, 2018, respectively. Such interest was capitalized as part of the outstanding loan balance.

Since March 31, 2019, through the filing date of this report the Company has received $589,126 in additional loans from Mr. Baskin. The notes bear interest at 10%.

Since March 31, 2019, through the filing date of this report the Company has received $450,000 in additional loans from other related parties. The notes bear interest at 10%.

NOTE 8 - STOCKHOLDERS' EQUITY

Common Stock

On ~~February~~January 121, ~~2018~~2019, ~~the~~under ~~Company entered into~~ an employment agreement ~~with Rick Mikles~~, the Company’s ~~Chairman~~issued 20,000,000 shares to ~~become~~its Chief ~~Marketing~~Executive Officer. ~~The~~ ~~agreement~~Under ~~has~~this aagreement ~~three-year~~there ~~term,~~is anno ~~annual~~specific ~~base~~performance ~~salary~~or oftime ~~$26,000 and a quarterly payment~~ based ~~on 3% of the quarterly revenue recognized by the Company~~metrics. ~~Mr.~~ ~~Mikles~~The ~~was granted 5,000,000~~ shares ofwere ~~the Company’s common stock,~~ valued at ~~its~~fair ~~trading~~on ~~price of $0.10 per share, which vested immediately. He was granted 5,000,000 options to purchase common stock of~~ the ~~Company~~date ~~at $0.10 per share. These options have a three-year expiration and vest one option per every 2 dollars~~ of ~~revenue recognized by the Company~~issuance.

On February 12, 2018, the Company entered into an employment agreement with Rick Mikles, the Company's Chairman, to become Chief Marketing Officer. The agreement has a three-year term, an annual base salary of $26,000 and a quarterly payment based on 3% of the quarterly revenue recognized by the Company. Mr. Mikles was granted 5,000,000 shares of the Company's common stock, valued at its trading price of $0.10 per share, which vested immediately. He was granted 5,000,000 options to purchase common stock of the Company at $0.10 per share. These options have a three-year expiration and vest one option per every 2 dollars of revenue recognized by the Company.

Stock Based Compensation

The Company has issued and outstanding two types of options, time vesting and performance vesting.

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Options - Time Vesting

The following table shows the stock option activity during the period ended ~~September~~March 3031, ~~2018~~2019:

	September 30, 2018
			Weighted
	Number of Options		Weighted Average Exercise Price
	Number of		Average
Outstanding at January 1, 2018		14,400,000	$	0.10
	Options		Exercise Price
Options outstanding at beginning of period		13,904,166	$	0.10
Changes during the period:
Granted - at market price		~~1,000,000~~-	$	0.10
Exercised		-		-
Forfeited		~~700,000~~-	$	0.10
Outstanding at September 30, 2018		14,700,000	$	0.10
Adjustments		-		-
Exercisable at September 30, 2018		11,104,169	$	0.10
Options outstanding at end of period		13,904,166		0.10
Weighted average fair value of options granted during the period	$	0.10	$	0.10
Options exercisable at end of period		13,591,666		0.10
Weighted average fair value of options granted during the period		-		-

~~Options~~Costs ~~issued~~incurred ~~for~~in ~~the~~respect ~~period~~of ~~ended~~stock-based ~~September~~compensation 30for employees, ~~2018~~advisors ~~were~~and ~~valued~~consultants ~~using~~for the ~~Black~~three-~~Sholes~~month ~~model~~periods ~~assuming~~ended ~~zero~~March ~~dividends~~31, a2019 were $049,230.10 ~~strike~~Costs ~~price,~~incurred ~~3-year~~in ~~expiration,~~respect ~~2.73%~~of ~~average~~stock ~~risk-free~~based ~~rate~~compensation ~~and~~for ~~201%~~employees, ~~average~~advisors ~~volatility.~~and ~~Options~~consultants ~~issued~~ for the ~~period~~three month periods ended ~~September~~March 3031, ~~2017~~2018 were ~~valued using the Black-Sholes model assuming zero dividends~~$129,562. aThe ~~$0.10~~expense ~~strike~~is ~~price,~~included ~~3-year~~in ~~expiration~~selling, ~~1.44%~~general ~~average~~and ~~risk-free~~administrative ~~rate~~expenses ~~and~~in ~~225%~~the ~~average~~statement ~~volatility~~of operations.

~~Costs~~Unrecognized ~~incurred in respect of stock based~~ compensation ~~for~~costs ~~employees,~~related ~~advisors~~to ~~and~~options ~~consultants~~as ~~for the three and nine month periods ended September 30, 2018 were $133,129 and $382,246, respectively. Costs incurred in respect~~ of ~~stock~~March ~~based compensation for employees~~31, ~~advisors~~2019 ~~and~~was ~~consultants for the three and nine month periods ended September 30, 2017 were~~ $~~121~~25,~~662 and $290~~938,~~571,~~ ~~respectively.~~which ~~The expense~~ is expected ~~included~~to inbe ~~selling,~~recognized ~~general~~ratably ~~and~~over ~~administrative~~a ~~expenses~~weighted inaverage ~~the~~period ~~statement~~ of ~~operations~~approximately 12 months.

Unrecognized compensation costs related to options as of September 30, 2018 was $296,546, which is expected to be recognized ratably over a weighted average period of approximately 18 months. The intrinsic value is zero

Options - Performance Vesting

The options vest based on Company performance with one option vesting for every two dollars of revenue, vesting quarterly. The following table shows the stock option activity during the period ended ~~September~~March 3031, ~~2018~~2019:

	September 30, 2018
			Weighted
	Number of Options		Weighted Average Exercise Price
	Number of		Average
Outstanding at January 1, 2018		31,341,094	$	0.10
	Options		Exercise Price
Options outstanding at beginning of period		26,081,808	$	0.10
Changes during the period:
Granted - at market price		~~7,500,000~~	$	0.10
Exercised		-		-
Expired/Forfeit		10,700,000	$	0.10
Expired/forfeited		-		0.10
Outstanding at September 30, 2018		28,141,094	$	0.10
Adjustments				-
Exercisable at September 30, 2018		7,014397	$	0.10
Options outstanding at end of period		26,081,808		0.10
Weighted average fair value of options granted during the period	$	0.08	$	0.10
Options exercisable at end of period		9,739,785		0.10
Weighted average fair value of options granted during the period		-	$	-

~~Options~~These options were issued to individuals for ~~the~~their ~~period~~business ~~ended~~development ~~September~~efforts. ~~30,~~The ~~2018~~costs ~~were~~incurred ~~valued~~in ~~using~~respect ~~the~~of ~~Black~~stock-~~Sholes~~based ~~model~~compensation ~~assuming~~for ~~zero dividends~~employees, aadvisors ~~$0.10~~and ~~strike~~consultants ~~price,~~for 3the three-~~year~~month ~~expiration,~~periods ~~2.52%~~ended ~~average~~March ~~risk-free~~31, ~~rate~~2019 ~~and~~were ~~196%~~$40,953. ~~average~~Costs ~~volatility.~~incurred ~~Options~~in ~~issued~~respect ~~for~~of ~~the~~stock ~~period~~based ~~ended~~compensation ~~September~~for 30employees, ~~2017~~advisors ~~were~~and ~~valued~~consultants ~~using~~for the ~~Black-Sholes~~three ~~model~~month ~~assuming~~periods ~~zero~~ended ~~dividends~~March 31, a2018 were $0142,067.10 ~~strike~~The ~~price,~~expense ~~3-year~~is ~~expiration~~included in selling, ~~1.62%~~general ~~average~~and ~~risk-free~~administrative ~~rate~~expenses ~~and~~in ~~259%~~the ~~average~~statement ~~volatility.~~of operations

12Unrecognized compensation costs related to options as of March 31, 2019 was $1,421,600 which is expected to be recognized ratably over a weighted average period of approximately 13 months.

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These options were issued to individuals for their business development efforts. The costs incurred in respect of stock based compensation for employees, advisors and consultants for the three and nine month periods ended September 30, 2018 were $96,466 and $215,113, respectively. Costs incurred in respect of stock based compensation for employees, advisors and consultants for the three and nine month periods ended September 30, 2017 were $281,767 and $360,994 respectively. The expense is included in selling, general and administrative expenses in the statement of operations

Unrecognized compensation costs related to options as of September 30, 2018 was $1,790,610 which is expected to be recognized ratably over a weighted average period of approximately 30 months. The intrinsic value is zero.

Warrants

The following table shows the warrant activity during the period ended ~~September~~March 3031, ~~2018~~2019:

				Weighted
	Number			Average
	Number of			Average
	Of			Exercise
	Warrants			Exercise Price
	Warrants			Price
Warrants outstanding at beginning of period		3,050,000		$	0.15
Outstanding at January 1, 2018		15,924,960
Changes during the period:
Granted		~~2,050,000~~-		$	~~0.15~~-
Exercised		-			-
Expired		(14,924,960	)	$	0.15
Expired/forfeited		(1,050,000	)		0.15
Outstanding at September 30, 2018		3,050,000		$	0.15
Warrants outstanding at end of period		2,000,000			0.15
Exercisable at September 30, 2018		3,050,000		$	0.15
Warrants exercisable at end of period		2,000,000		$	0.15

~~Warrants~~Costs ~~issued~~incurred ~~were~~for ~~valued using the Black-Scholes model assuming zero dividends, a $0.15 strike price, 1-year expiration, 2.09% risk-free rate and volatility of 286%. The relative fair value of~~ warrants issued to related parties ~~with~~for the conversion of debt ~~was~~were recorded as interest expense and was ~~zero~~$0 and $50,741 for the three ~~and nine~~ months ended ~~September~~March 3031, 2019 and 2018, respectively.

~~Costs~~NOTE 9 ~~incurred~~- inBASIC ~~respect~~AND ofDILUTED ~~warrants~~LOSS ~~issued~~PER ~~to investors for the three and nine months ended September 30, 2017 were zero and $367,662.~~SHARE

~~NOTE 7~~Basic –net ~~BASIC~~loss ~~AND~~per ~~DILUTED~~share ~~LOSS~~is ~~PER~~calculated ~~SHARE~~by dividing the loss by the weighted-average number of shares outstanding for the period. Diluted net loss per share is computed by dividing the net attributable to common stockholders by the sum of the weighted average number of shares of common stock outstanding and the dilutive common stock equivalent shares outstanding during the period. The Company's dilutive common stock equivalent shares, which include incremental common shares issuable upon i) the exercise of outstanding stock options and warrants and (ii) vesting of restricted stock units and restricted stock awards, are only included in the calculation of diluted net loss per share when their effect is dilutive. Since the Company had net losses for all periods presented, all potentially dilutive securities are anti-dilutive. Accordingly, basic and dilutive net loss per share are equal.

Basic net loss per share is calculated by dividing the loss by the weighted-average number of shares outstanding for the period. Diluted net loss per share is computed by dividing the net attributable to common stockholders by the sum of the weighted average number of shares of common stock outstanding and the dilutive common stock equivalent shares outstanding during the period. The Company’s dilutive common stock equivalent shares, which include incremental common shares issuable upon i) the exercise of outstanding stock options and warrants and (ii) vesting of restricted stock units and restricted stock awards, are only included in the calculation of diluted net loss per share when their effect is dilutive. Since the Company had net losses for all periods presented, all potentially dilutive securities are anti-dilutive. Accordingly, basic and dilutive net loss per share are equal.

The following potential common stock equivalents were not included in the calculation of diluted net loss per common share because the inclusion thereof would be anti-dilutive.

	Three and Nine Months Ended
	Three Months Ended
	September 30,
	March 31,
	2018		2017
	2019		2018
Stock Options		4239,~~841~~985,~~094~~974		3942,~~000~~841,~~000~~094
Warrants		32,~~050~~000,000		143,~~924~~050,~~960~~000
Total		4541,~~891~~985,~~094~~974		5345,~~924~~891,~~960~~094

13NOTE 10 - COMMITMENTS AND CONTINGENCIES

16(b) Litigation

On September 26, 2016, Registrant filed in the United States District Court for the Middle District of Florida a Complaint against defendants The Mazzal Trust, Nissim S. Trabelsi and Shawn Telsi (collectively the “Defendants”), seeking the disgorgement of profits obtained by Defendants and certain of their shareholder affiliates defined under Rule 16a-1(a)(1) under the Exchange Act defined below (collectively, the “Group”) through “short swing profits” in violation of Section 16(b) of the Securities Exchange Act of 1934 (the “Exchange Act”). Specifically, Registrant alleged that the Group acted under the guidance and control of the Defendants, whose individual defendants had filed forms 3 and 4 with the Securities and Exchange Commission (the “SEC”, declaring themselves to be “insiders” for the purpose of Section 16(b). The Group owned 100% of the shares of Registrant at the time that members of the group were engaged in the sale and purchase of such shares. The sales and purchases referenced all occurred with three months of other sales and purchases, subjecting Defendants to disgorge to Registrant all profits made by the Group in such sales and purchases. As detailed in paragraphs 16-22 of the Complaint, the total profits received by the Group is $1,695,689. Accordingly, Registrant has demanded the return of all such profits to Registrant plus the statutory payment of attorneys’ fees.

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NOTE 8 – LITIGATION

On September 26, 2016,Znergy (“Registrant”) filed in the United States District Court for the Middle District of Florida a Complaint against defendants The Mazzal Trust, Nissim S. Trabelsi and Shawn Telsi (collectively the “Defendants”), seeking the disgorgement of profits obtained by Defendants and certain of their shareholder affiliates defined under Rule 16a-1(a)(1) under the Exchange Act defined below (collectively, the “Group”) through “short swing profits” in violation of Section 16(b) of the Securities Exchange Act of 1934 (the “Exchange Act”). Specifically, Registrant alleged that the Group acted under the guidance and control of the Defendants, whose individual defendants had filed forms 3 and 4 with the Securities and Exchange Commission (the “SEC”, declaring themselves to be “insiders” for the purpose of Section 16(b). The Group owned 100% of the shares of Registrant at the time that members of the group were engaged in the sale and purchase of such shares. The sales and purchases referenced all occurred with six months of other sales and purchases, subjecting Defendants to disgorge to Registrant all profits made by the Group in such sales and purchases. As detailed in paragraphs 16-22 of the Complaint, the total profits received by the Group is $1,695,689. Accordingly, Registrant has demanded the return of all such profits to Registrant plus the statutory payment of attorneys’ fees.

On August 24, 2017, the Plaintiff received a Clerk’s Entry of Default against Nissim Trabelsi. The Plaintiff filed a Motion for Default Judgment for damages against Trabelsi on September 13, 2017, which to date has not been addressed by the Court. On March 5, 2018, Nissim Trabelsi filed a notice of bankruptcy. The Plaintiff is still pursuing its options in the Case and the Court has yet to address the service issues with the Mazzal Trust.

OnNOTE ~~January~~11 ~~26,~~– 2017, the Company received an email from its transfer agent, VStock Transfer, LLC, (“VStock”) informing the Company that it had been served with a Summons and Complaint (B2 Opportunity Fund (“B2”) v. Trabelsi et al. - Index No.:17-CV-10043, the “Claim”) and further stating that the Company was obligated to indemnify VStock for fees and expenses incurred in defending the Claim. The Company responded on February 24, 2017 stating that (1) we reviewed the Transfer Agent and Registrar Agreement between Mazzal and VStock dated May 20, 2014 and that in Article VI(c) of that agreement it states that indemnification will not be offered if the acts of VStock constitute bad faith or gross negligence, (2) we reviewed the lawsuit filed by B2 against VStock and others and find that VStock’s actions constitute gross negligence and perhaps bad faith, and we therefore deny indemnification of VStock relating to the Claim, and (3) should VStock take any action to seek indemnification by Znergy in any manner, Znergy will either join B2 in its lawsuit or will file an action on its own. The Company terminated its agreement with VStock. The issue in its entirety was settled with no impact to the Company on April 25, 2018.CONCENTRATIONS

~~NOTE~~For 9the –three ~~CUSTOMER~~months ~~CONCENTRATION~~ended March 31, 2019 four customers represented 35%, 27%, 13% and 12% of net customer installation and product sale revenue. For the three months ended March 31, 2018, the company recognized installation revenue of $178,898 from one customer, which represents 37% of revenue for the quarter.

~~For~~At ~~the~~March ~~three~~31, ~~months ended September 30~~2019, ~~2018~~ two customers represented 2871% and 6016% of net ~~revenue~~accounts receivable. ~~For~~At ~~the~~December ~~three months ended September 30~~31, ~~2017~~2018, ~~one~~two ~~customer~~different customers represented ~~substantially~~83% ~~all~~and 18% respectively of net ~~revenue~~accounts receivable.

~~For~~The ~~the~~Company ~~nine~~purchases ~~months~~substantially ~~ended~~all ~~September~~its ~~30,~~inventory ~~2018,~~from ~~various~~one ~~customers represented 26%, 16% and 12% of net revenue~~supplier. ~~For~~The ~~the~~Company ~~nine~~does ~~months~~not ~~ended~~have ~~September~~any ~~30,~~commitments ~~2017,~~with ~~one~~this ~~customer~~supplier ~~represented~~for ~~50%~~minimum ~~and 32%~~purchases.

AtNOTE ~~September 30, 2018, one customer represented 64% of the net accounts receivable. At December 31, 2017, three different customers represented 22%, 21% and~~ 12% ~~respectively~~- ofSUBSEQUENT ~~net accounts receivable.~~EVENTS

~~NOTE~~Since 10March –31, ~~SUBSEQUENT~~2019, ~~EVENTS~~through the filing date of this report the Company has received $496,000 in additional advances and loans from the Chairman of the Board. In February 2021, the Company agreed to consolidate the total loans, advances and accrued interest into a single Note in the amount of $928,238, the full amount of which is payable upon demand. Since March 31, 2019 through the filing date of this report the Company received $589,126 from Mr. Baskin and a further $500,000 from other related parties.

~~Since~~Subsequent ~~September~~to 30March ~~2018~~31, 2019 through the filing date, the Company has issued 45,983,333 shares of ~~this~~common ~~report~~stock. 11,200,000 shares were issued to the ~~Company~~Chairman ~~has~~of ~~received~~the ~~$296~~Board in exchange for the cancellation of 14,000,000 instock ~~additional~~options ~~advances~~outstanding. ~~and~~In ~~$450~~addition 4,000,000 ofshares ~~additional~~were ~~loans~~issued ~~from~~to ~~related~~a ~~parties~~Director, Jerry Horowitz in exchange for business development efforts. Through these efforts, the Company was introduced to a large retailer which resulted in a multi-store contract.

~~Subsequent~~On to September 3010, ~~2018~~2019, ~~through~~ the ~~filing~~Company ~~date~~executed an unsecured $275,000 ~~the~~promissory ~~Company~~note ~~has~~payable ~~issued~~to 16Randy Fluitt,~~200,000~~ ~~shares~~a Company shareholder. The Note bears interest of ~~common~~10% ~~stock~~per annum. 11The Note is due and payable in the amount of $302,~~200~~500 on or before the Maturity Date of February 1,~~000~~ ~~shares~~2020. ~~were~~The ~~issued~~Company’s failure to pay the ~~Chairman~~principal and interest within 15 days of the ~~Board~~Maturity inDate, ~~exchange~~will ~~for~~trigger a penalty of 10% of any amounts unpaid at the ~~cancellation~~end of ~~19,000,000~~this ~~stock~~period. ~~options~~The Company did not repay the loan by the Maturity Date and ~~2,000,000~~accrued ~~warrants~~the ~~outstanding~~penalty as interest expense. In addition, 42,000,000 ~~shares~~warrants ~~were~~are to be issued inat ~~exchange~~a ~~for~~strike ~~business~~price ~~development~~of ~~efforts~~$.10 with a one year maturity.

On ~~July~~December 319, 2019, the Company issued 32,500,000 shares in exchange for $192,500 to an unrelated accredited investor. ~~On July 9, 2019, the Company issued 20,000,000 shares to its Chief Executive Officer.~~

14On November 26, 2019, the Company received a third-party loan from the Korenstra Family Foundation for $150,000.

In April 2020, the Company received an unsecured loan (the “SBA Loan”) under the Small Business Administration (“SBA”) Paycheck Protection Program of the Coronavirus Aid, Relief and Economic Security Act CARES Act through Chase Bank (“Lender”). The SBA Loan has a two-year term expiring on April 2022. The SBA Loan has a principal amount of $87,457 with an interest rate of 1.0%. The Company expects that the full principal amount of the loan will be forgiven. Interest accrues during the period between funding date and the date the loan is forgiven. The Company has not yet applied for loan forgiveness but plans to in a future period.

In May 2020, the Company received an unsecured loan under the Small Business Administration (“SBA”), Economic Injury Disaster Loan (“EIDL”) program to assist business businesses effected by the COVID-19 pandemic. The EIDL Loan has a thirty-year term and has a principal amount of $150,000 with an interest rate of 3.75%. The Company expects that the full principal amount of the loan will be forgiven. Interest accrues during the period between funding date and the date the loan is forgiven. The Company has not yet applied for loan forgiveness but plans to in a future period.

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On December 7, 2020, the Company issued a convertible promissory note to Tysadco Partners, LLC for the sum of $156,750. The Note bears interest of 12% per annum until the Note becomes due and payable on December 7, 2022 (Maturity Date). Any amount of principal or interest on this Note which is note repaid by the Maturity Date shall then bear interest at 20% per annum. At any time after 180 days from the Note’s inception until the Maturity Date or payment date, Tysadco may convert the balance or any portion of the balance to Common Stock at the lower of $.15 per share or 80% of the Market Price. Where the Market Price is defined as the ten day trading period prior to the conversion date.

On March 11, 2021, the Company closed a purchase agreement between the Company and Quantum Energy and the Company and Quantum’s owner, Jim Collins. Customer lists and name recognition were acquired from Quantum for $1. Further, the Company shall pay a 10% commission for any sales derived from Quantum’s pre-existing sales or audits that generate revenue for the Company. Quantum’s owner, Jim Collins agreed to a consulting agreement with the Company for a three year period. This consulting agreement states that Mr. Collins shall act as a sales manager, primarily in the Washington State area and he shall receive an 8% commission on any new sale generated. During this three year period, Mr. Collins shall receive 2,000,000 shares of the Company, vesting one third each year. The Company executed a consulting agreement with Justin Collins to be the Company’s National Project Manager. Under this agreement, Mr. Justin Collins, shall receive a commission of 6% on new sales and an additional bonus of 20% on the differential between budgeted and actual expense, should budgeted expense exceed actual. After a 90 day period, the Company has agreed to negotiations, at its sole discretion, for Mr. Justin Collins to become the Company’s Chief Operating Officer. The stated salary for this position is $80,000 per annum.

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CAUTIONARY STATEMENT FOR FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We have based these forward-looking statements on our current expectations and projections about future events, and they are applicable on as of the dates of such statement. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “could,” “would,” “forecast,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “continue,” or the negative of such terms or other similar expressions. Factors that might cause or contribute to such a discrepancy include, but are not limited to, those listed under the heading “Risk Factors” and those listed in our other SEC filings. You should not put undue reliance on any forward-looking statements. These statements speak only as of the date of this Quarterly Report on Form 10-Q, even if subsequently made available on our website or otherwise, and we undertake no obligation to update or revise these statements to reflect events or circumstances occurring after the date of this Quarterly Report on Form 10-Q. The following discussion should be read in conjunction with our Financial Statements and related Notes thereto included elsewhere in this report. Throughout this Quarterly Report on Form 10-Q we will refer to Znergy, Inc., together with its subsidiaries, as the “Company,” “we,” “us,” and “our”.

The following discussion and analysis of our financial condition should be read together with our unaudited Consolidated Financial Statements and related notes included in this Form 10-Q as well as our audited Financial Statements and related notes included in our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2017~~2018 filed with the SEC on ~~June~~September 64, ~~2018~~2020.

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

Overview

The Company was formed in January 2013 as a Nevada corporation. The original business plan of the Company was to build and sell multi-family housing projects. The Company acquired a parcel of land in Taunton, Massachusetts, from The Mazzal Trust, a trust of which the founder of the Company, Nissim Trabelsi, was the Trustee, in exchange for shares of the Company’'s common stock, and began development of the project and construction of multi-family units.

On October 26, 2015, the Company acquired Global ITS, Inc. and its wholly owned subsidiary, Znergy, Inc. in order to expand into the Energy Efficiency (EE) marketplace, focusing on commercial lighting and green project financing. On February 9, 2016, the Company agreed to sell to the Mazzal Trust the real property which the Trust had previously sold to the Company and the Trust returned to the Company 149,950,000 of the 150,000,000 shares of the Company’'s common stock owned by the Trust. This transaction caused a change of control with Global being the accounting acquirer. The Company is now focused solely on the EE marketplace with an emphasis on LED retrofitting and installing new lamps.

The Company determined that Global ITS, Inc. served no purpose for the Company. It held no assets or operations, had been dormant for over a year, except for the operations of its wholly owned Subsidiary. On October 1, ~~2017~~2018, the Company sold 100% of its shares in Global to Peter Peterson, a shareholder of the Company and a creditor of Global for a nominal amount. The sale did not include Global’'s investment in its subsidiary.

The Company is a provider of energy-efficient lighting products, lighting controls and energy management solutions. The Company offers a full turn-key lighting solution which includes economic assessments, energy efficient analysis, installation and rebate support for the Company’'s customers. The Company’'s business primarily involves retrofitting existing lighting solutions from traditional high intensity metal halide and fluorescent lighting to energy efficient LED (Light Emitting Diode) technology.

Managing energy consumption and the associate costs is increasingly important to building owners. Technological advancements in LED, together with significant private and public incentives for sustainability initiatives have made lighting infrastructure changes an effective way for building owners to cut energy costs. LED lighting provides energy efficiency, long life, low running temperatures and increasing technology such as dimmable lights.

The Company does not have long term contracts with its customers and the Company’'s revenue comes from the sales of lighting systems involving the replacement of existing lighting fixtures with new energy efficient LED fixtures. In addition, the Company generates revenue from available utility incentives and rebate programs.

1519

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The Company provides its turn-key service though a detailed evaluation of the customer’'s needs and performing an audit of the customer’'s current energy consumptions and costs, together with an analysis of the benefits of retrofitting their lights. Typically, the customer experiences an average payback on their investment between 12 and 24 months.

The Company intends to grow organically by selling energy efficiency (EE) and commercial security (CS) products to industrial and commercial businesses as well as municipal and state governments, universities and colleges, K-12 schools, and hospitals (the “MUSH” market). Strained government budgets have convinced state and local governments across the United States to embrace a new form of performance-based investments in energy efficiency offered by Energy Services Companies, or ESCOs. An ESCO provides energy-efficiency-related and other value-added services and for which performance contracting is a core part of its energy-efficiency services business. In a performance contract, the ESCO guarantees energy or financial savings for the project, which means ESCOs only make money if the project performs as promised. A study prepared by Allied Market Research indicated that the market is expected to grow at a Compound Annual Growth Rate of 13.76% during the forecast period 2014-2020 and reach $44.4 billion by 2020.

The Company plans to increase its competitive position by providing financing to customers for installation projects through a strategic partnership the Company has developed with a well-established funding group focused on energy efficiency projects.

Results of Operations

The Company had revenues of $1186,~~298,696~~618 and $1482,~~015,217~~972 for the ~~nine~~three-month ~~periods~~period ended ~~September~~March 3031, ~~2018~~2019, and ~~2017, respectively. The Company had revenues of $556,142 and $586,976 for the three-month periods ended September 30,~~ 2018, ~~and 2017,~~ respectively. Revenues in ~~2018~~2019 and ~~2017~~2018 comprise LED installation projects and associated rebates from utilities. The decrease in revenues for the three-month period is due ~~longer~~to ~~than~~as ~~anticipated~~compared ~~implementation~~to ofthe ~~formalized~~same ~~training~~period ~~programs~~in of2018 ~~new~~was ~~sales~~primarily ~~representatives~~driven by the Covid-19 pandemic and ~~due~~related toclosures ~~timing~~and shutdowns. In late 2018 and the first quarter of ~~installations.~~2019 ~~The~~the Company ~~expects~~began toexpanding ~~continue~~inventory toand ~~see~~installation ~~increased~~staff ~~revenue~~ in ~~future~~preparation ~~periods~~for ~~but~~a ~~can~~retail ~~make~~outlet noconversion ~~assumptions~~project aswhich was to ~~size~~encompass ofa ~~any~~total ~~increases~~of or514 ~~certainty thereof~~stores.

The Company incurred costs of revenue of $~~665~~175,~~154~~402 and $~~596~~229,~~661~~628 for the ~~nine-month periods ended September 30, 2018 and 2017, respectively. The Company incurred costs of revenue of $259,158 and $423,334 for the~~ three-month ~~periods~~period ended ~~September~~March 3031, ~~2018~~2019 and ~~2017~~2018, respectively. Costs of revenue in ~~2018~~2019 and ~~2017~~2018 comprise primarily LED product and installation costs, including labor and rental equipment. Cost of revenue as a percentage of revenue can be impacted by the type of jobs and if the job requires customized lighting.

The Company had selling, general and administrative expenses of $2,~~486~~090,~~001~~664 and $31,~~654~~234,~~877~~352 for the ~~nine~~three-month ~~periods~~period ended ~~September~~March 3031, ~~2018~~2019 and ~~2017~~2018, respectively. The ~~Company~~increase ~~had~~for ~~general~~the ~~and~~three-month ~~administrative~~period ~~expenses~~is ofprimarily ~~$668,000~~due to an increase in stock based compensation and ~~$1,241,262~~associated ~~for~~taxes ~~the~~in ~~three-month~~2019 ~~periods~~as ~~ended September~~compared ~~30,~~to 2018. ~~and~~On ~~2017~~January 1, ~~respectively.~~2019, ~~The~~we ~~decrease~~issued ~~for~~20,000,000 ~~the~~shares ~~nine-month~~to ~~period~~our isCEO. ~~primarily~~The ~~due~~expense toassociated awith ~~reduction~~this ingrant ~~stock-based~~was ~~compensation~~$1,800,000 ~~costs.~~which ~~The~~was ~~decrease~~the ~~for~~main ~~the~~driver ~~three-month~~of ~~period~~our isMarch ~~also~~31, ~~primarily~~2019 ~~due~~increase toin ~~reduced~~general ~~equity-based~~and ~~compensation~~administrative ~~costs~~expenses.

The Company incurred interest expense of $315,~~749~~375 and ~~zero~~$111,559 for the three ~~and nine~~-month ~~periods~~period ended ~~September~~March 3031, ~~2018.~~2019 ~~This~~and is2018, ~~compared~~respectively. toThe ~~zero~~decrease ~~for the same periods~~ in ~~2017.~~interest ~~This~~expense is the result of the ~~additional~~exchange ~~Notes~~of ~~Payable~~debt ~~and~~for ~~Advances~~common ~~the~~stock ~~company~~during ~~has entered into to finance~~ the ~~operations of the Company~~period.

The Company had net losses of $2,~~068~~093,~~116~~364 and $31,~~236~~092,~~321~~567 for the ~~nine~~three-month periods ended ~~September~~March 3031, ~~2018~~2019 and ~~2017~~2018, respectively.

~~The~~Liquidity ~~Company had net losses of $367,035~~ and ~~$1,077,620~~Going ~~for~~Concern ~~the three-month periods ended September 30, 2018 and 2017, respectively.~~Discussion

~~Liquidity~~The accompanying condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and ~~Going~~the ~~Concern~~liquidation ~~Discussion~~of liabilities in the normal course of business. As of March 31, 2019, the company had a working capital deficit of $2,123,215, insufficient cash resources to meet its planned business objectives, and accumulated losses of $18,236,340. The Company intends to fund operations through equity and debt financing arrangements, which may be insufficient to fund its capital expenditures, working capital and other cash requirements through 12 months from the date of issuance. As a result, the Company is seeking additional funding through debt and equity financing arrangements, or other funding opportunities.

The ~~10-Q has been prepared assuming that the~~ Company's ~~will~~success ~~continue~~is asdependent ~~a going concern~~upon, ~~which~~among ~~contemplates~~other ~~the realization of assets and the liquidation of liabilities in the normal course of business. As of September 30~~things, ~~2018,~~obtaining the ~~company~~additional ~~had~~financing ato ~~working~~continue ~~capital~~operations ~~deficit~~and ~~of $890,620, insufficient cash resources~~ to ~~meet~~execute its ~~planned~~ business ~~objectives, and accumulated losses of $14,507,419~~plan. ~~The~~No ~~Company~~assurances ~~intends~~can tobe ~~fund~~made ~~operations~~that ~~through~~management ~~equity~~will ~~and debt financing arrangements, which may~~ be ~~insufficient~~successful toin ~~fund~~pursuing ~~its~~any ~~capital expenditures, working capital and other cash requirements through 12 months from the date~~ of ~~issuance.~~these ~~As a result, the Company is seeking additional funding through debt and equity financing arrangements, or other funding opportunities~~strategies.

16These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern. The accompanying condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

~~Table of Contents~~20

~~The~~Table Company’s success is dependent upon, among other things, obtaining the additional financing to continue operations and to execute its business plan. No assurances can be made that management will be successful in pursuing any of ~~these strategies.~~Contents

~~These~~Plan factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying condensed consolidated financial statements do not include any adjustments that might result from the outcome of ~~this uncertainty.~~Operation

~~Plan~~The Company's anticipated plan of ~~Operation~~operation is to continue to (1) identify and train sales personnel in regions of the country that have advantageous utility company rebate programs, (2) identify and train lighting installation personnel where we have established sales personnel, (3) seek out the best current and incipient solutions in the Energy Efficiency marketplace and become a reseller of those solutions, (4) develop our own solutions for the EE marketplace, and (5) seek to acquire other businesses in the market where such acquisitions makes strategic sense and are accretive to earnings.

The Company’s ~~anticipated~~continues ~~plan~~to ofexpand ~~operation~~its issolutions toportfolio ~~continue~~for toboth ~~(1)~~indoor ~~identify~~ and ~~train~~outdoor ~~sales~~applications ~~personnel~~to incapitalize ~~regions~~on of the ~~country~~evolving ~~that~~and ~~have~~growing ~~advantageous~~market ~~utility~~for ~~company~~intelligent ~~rebate~~networked ~~programs,~~systems ~~(2)~~that ~~identify~~collect and ~~train~~exchange ~~lighting~~data ~~installation~~to ~~personnel~~increase ~~where~~efficiency weas ~~have~~well ~~established~~as ~~sales~~provide ~~personnel,~~a ~~(3)~~host ~~seek~~of ~~out~~other ~~the~~economic ~~best~~benefits ~~current~~resulting ~~and~~from ~~incipient~~data ~~solutions~~analytics into ~~the~~better ~~Energy~~enable ~~Efficiency~~smart ~~marketplace~~buildings and ~~become~~smart acities. ~~reseller~~The oftransition ~~those~~to ~~solutions,~~solid-state ~~(4)~~lighting ~~develop~~provides ~~our~~the ~~own~~opportunity ~~solutions~~ for ~~the~~lighting EEto ~~marketplace,~~be ~~and~~integrated ~~(5)~~with ~~seek~~other building automation systems to ~~acquire~~create ~~other~~an ~~businesses~~optimal inplatform for enabling the ~~market~~“Internet ~~where~~of ~~such~~Things” (IoT), ~~acquisitions~~which ~~makes~~will ~~strategic~~support ~~sense~~the ~~and~~advancement ~~are~~of ~~accretive~~smart tobuildings, ~~earnings~~smart cities, and the smart grid.

The Company's ~~continues~~ability to ~~expand~~grow its ~~solutions~~incipient ~~portfolio~~operations ~~for~~is ~~both~~primarily ~~indoor~~dependent ~~and~~upon ~~outdoor~~its ~~applications~~ability to ~~capitalize~~raise onadditional ~~the~~capital, ~~evolving~~most ~~and~~likely ~~growing~~through ~~market~~the ~~for~~sale ~~intelligent~~of ~~networked~~additional ~~systems~~shares ~~that~~of ~~collect~~the ~~and~~Company's ~~exchange~~common ~~data~~stock toor ~~increase efficiency as well as provide a host of~~ other ~~economic benefits resulting from data analytics to better enable smart buildings and smart cities~~securities. ~~The~~There ~~transition~~can tobe ~~solid-state~~no ~~lighting~~guarantee ~~provides~~that the ~~opportunity~~Company ~~for~~will ~~lighting to~~ be ~~integrated~~able ~~with~~raise ~~other~~additional ~~building~~capital ~~automation~~on ~~systems~~terms tothat ~~create~~are anacceptable ~~optimal~~to ~~platform for enabling~~ the ~~“Internet of Things” (IoT)~~Company, ~~which~~or ~~will~~at ~~support the advancement of smart buildings, smart cities, and the smart grid~~all.

The ~~Company’s~~realization ~~ability~~of torevenues ~~grow~~in ~~its~~the ~~incipient~~next ~~operations~~twelve months is ~~primarily~~important ~~dependent~~in ~~upon~~the ~~its~~execution ~~ability~~of tothe plan of operations. However, if the Company cannot raise additional capital, ~~most~~by ~~likely~~issuing capital stock in exchange for cash, or through ~~the~~obtaining ~~sale~~commercial ofor ~~additional~~bank ~~shares~~financing, ofin order to continue as a going concern, the Company’s ~~common~~may ~~stock~~have to curtail or ~~other~~cease ~~securities~~its operations. ~~There~~As ~~can~~of bethe date of this Report, there were no ~~guarantee~~formal ~~that~~or ~~the~~informal agreements to attain such financing. The Company ~~will~~cannot assure any investor that, if needed, sufficient financing can be ~~able~~obtained ~~raise~~or, ~~additional~~if ~~capital~~obtained, that it will be on reasonable terms. ~~that~~Without ~~are~~realization ~~acceptable~~of toadditional ~~the Company~~capital, orit atwould ~~all~~be unlikely for operations to continue.

~~The~~Critical ~~realization~~Accounting of revenues in the next twelve months is important in the execution of the plan of operations. However, if the Company cannot raise additional capital by issuing capital stock in exchange for cash, or through obtaining commercial or bank financing, in order to continue as a going concern, the Company may have to curtail or cease its operations. As of the date of this Report, there were no formal or informal agreements to attain such financing. The Company cannot assure any investor that, if needed, sufficient financing can be obtained or, if obtained, that it will be on reasonable terms. Without realization of additional capital, it would be unlikely for operations to continue.Policies

~~Critical~~There ~~Accounting~~have ~~Policies~~been no changes to our critical accounting policies from those included in our Annual Report on Form 10-K for the year ended December 31, 2018 filed with the SEC on September 4, 2020.

~~There~~Recently ~~have~~Issued ~~been~~Accounting ~~no changes to our critical accounting policies from those included in our Annual Report on Form 10-K for the year ended December 31, 2017 filed with the SEC on June 6, 2018.~~Pronouncements

~~Recently~~We ~~Issued~~are ~~Accounting~~required ~~Pronouncements~~to adopt certain new accounting pronouncements. See Note 2 to the condensed consolidated financial statements included in Item 1 of this Form 10-Q.

WeOff-Balance ~~are~~Sheet ~~required to adopt certain new accounting pronouncements. See Note 1 to the condensed consolidated financial statements included in Item 1 of this Form 10-Q.~~Arrangements

~~Off~~We have not entered into any off-~~Balance~~balance ~~Sheet~~sheet ~~Arrangements~~arrangements or issued guarantees to third parties.

~~We have not entered into any off-balance sheet arrangements or issued guarantees to third parties.~~21

17Table of Contents

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

Not applicable.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are the controls and other procedures that are designed to provide reasonable assurance that information required to be disclosed by the issuer in the reports that it files or submits under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’'s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’'s management, including the principal executive and principal financial officer, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. We have carried out an evaluation, under the supervision and with the participation of our Chief Executive Officer and our Chief Financial Officer of the effectiveness of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act as of the end of the period covered by this Quarterly Report.

We have carried out an evaluation, under the supervision and with the participation of our Chief Executive Officer and our Chief Financial Officer of the effectiveness of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act as of the end of the period covered by this Quarterly Report.

Based upon that evaluation we have concluded that our disclosure controls and procedures were ineffective as of the end of the period covered by this report due to a material weakness in our internal control over financial reporting, which is described below.

Our management identified the following material weaknesses which are indicative of many small companies with small staff: (i) inadequate segregation of duties and effective risk assessment; and (ii) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of both US GAAP and SEC guidelines although we plan to take steps to enhance and improve the design of our internal control over financial reporting, we have not been able to remediate the material weaknesses identified above. To remediate such weaknesses, we hope to implement the following changes during our fiscal year ending December 31, 2020 (i) appoint additional qualified personnel to address inadequate segregation of duties and ineffective risk management; and (ii) adopt sufficient written policies and procedures for accounting and financial reporting. The remediation efforts set out in (i) and (ii) are largely dependent upon our securing additional financing to cover the costs of implementing the changes required. If we are unsuccessful in securing such funds, remediation efforts may be adversely affected in a material manner.

The Company has not had sufficient internal accounting personnel working at their corporate office which has led to a lack of segregation of duties and timely closing processes, nor did we perform an effective assessment of our system of internal control. The accounting functions have been handled by a combination of third parties off-site and internal personnel which has hindered the Company’s ability to timely reconcile its accounts, maintain the proper controls under the underlying documentation and close its books and records. This was a result of the early stage in the Company's growth. The Company will be adding internal accounting personnel in 2020 which should allow the Company to start to remediate its internal control issues. The Company also hired a GAAP experienced consulting firm in January 2020.

Changes in Internal Control over Financial Reporting

There have not been any changes in our internal control over financial reporting (as such term is defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act) during the three-month period ended ~~September~~March 3031, ~~2018~~2019 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings

On ~~September~~June 26, 2016,~~Znergy~~ (“Registrant”) filed in the United States District Court for the Middle District of Florida a Complaint against defendants The Mazzal Trust, Nissim S. Trabelsi and Shawn Telsi (collectively the “Defendants”), seeking the disgorgement of profits obtained by Defendants and certain of their shareholder affiliates defined under Rule 16a-1(a)(1) under the Exchange Act defined below (collectively, the “Group”) through “short swing profits” in violation of Section 16(b) of the Securities Exchange Act of 1934 (the “Exchange Act”). Specifically, Registrant alleged that the Group acted under the guidance and control of the Defendants, whose individual defendants had filed forms 3 and 4 with the Securities and Exchange Commission (the “SEC”, declaring themselves to be “insiders” for the purpose of Section 16(b). The Group owned 100% of the shares of Registrant at the time that members of the group were engaged in the sale and purchase of such shares. The sales and purchases referenced all occurred with ~~six~~three months of other sales and purchases, subjecting Defendants to disgorge to Registrant all profits made by the Group in such sales and purchases. As detailed in paragraphs 16-22 of the Complaint, the total profits received by the Group is $1,695,689. Accordingly, Registrant has demanded the return of all such profits to Registrant plus the statutory payment of attorneys’ fees.

On August 24, 2017, the Plaintiff received a Clerk’s Entry of Default against Nissim Trabelsi. The Plaintiff filed a Motion for Default Judgment for damages against Trabelsi on ~~September~~June 13, 2017, which to date has not been addressed by the Court. On March 5, 2018, Nissim Trabelsi filed a notice of bankruptcy. The Plaintiff is still pursuing its options in the Case and the Court has yet to address the service issues with the Mazzal Trust.

On January 26, 2017, the Company received an email from its transfer agent, VStock Transfer, LLC, (“VStock”) informing the Company that it had been served with a Summons and Complaint (B2 Opportunity Fund (“B2”) v. Trabelsi et al. - Index No.:17-CV-10043, the “Claim”) and further stating that the Company was obligated to indemnify VStock for fees and expenses incurred in defending the Claim. The Company responded on February 24, 2017 stating that (1) we reviewed the Transfer Agent and Registrar Agreement between Mazzal and VStock dated May 20, 2014 and that in Article VI(c) of that agreement it states that indemnification will not be offered if the acts of VStock constitute bad faith or gross negligence, (2) we reviewed the lawsuit filed by B2 against VStock and others and find that VStock’s actions constitute gross negligence and perhaps bad faith, and we therefore deny indemnification of VStock relating to the Claim, and (3) should VStock take any action to seek indemnification by Znergy in any manner, Znergy will either join B2 in its lawsuit or will file an action on its own. The Company terminated its agreement with VStock. The issue in its entirety was settled with no impact to the Company on April 25, 2018.

Item 5. Other Information.

None

1923

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Item 6. Exhibits

(a) Exhibits

Exhibit No.		Description
3.1		Articles of Incorporation for BIDC (previously filed as an exhibit to the Company’'s registration statement on Form S-1, filed with the Commission on June 10, 2013)
3.2		Bylaws of BIDC (previously filed as an exhibit to the Company’'s registration statement on Form S-1, filed with the Commission on June 10, 2013)
3.3		Amended and Restated Articles of Incorporation, as filed with the Nevada Secretary of State on July 15, 2016 (previously filed as an exhibit to the Company’'s information statement on Form Def 14C, filed with the Commission on May 31, 2016)
10.1		Share Exchange Agreement, dated as of October 26, 2015 (previously filed as an exhibit to the Company’'s Current Report on Form 8-K, filed with the Commission on October 27, 2015)
10.2		Master Stock Purchase Agreement (previously filed as an exhibit to the Company’'s Current Report on Form 8-K, filed with the Commission on February 12, 2016)
10.3		Employment Agreement with Dave Baker (previously filed as an exhibit to the Company’'s Current Report on Form 8-K, filed with the Commission on October 4, 2016)
10.4		Employment Agreement with Dave Baker (previously filed as an exhibit to the Company’'s Current Report on Form 8-K, filed with the Commission on May 1519, 2017)
10.5		Employment Agreement with Christopher Floyd (previously filed as an exhibit to the Company’'s Current Report on Form 8-K, filed with the Commission on May 1519, 2017)
10.6		Employment Agreement with Ryan Smith (previously filed as an exhibit to the Company’'s Current Report on Form 8-K, filed with the Commission on July 12, 2017)
31.1		Certification of the Chief Executive Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a).
32.1		Certification of Chief Executive Officer pursuant to 18 U.S.C. §1350 as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002.
101 INS		XBRL Instance Document*
101 SCH		XBRL Schema Document*
101 CAL		XBRL Calculation Linkbase Document*
101 DEF		XBRL Definition Linkbase Document*
101 LAB		XBRL Labels Linkbase Document*
101 PRE		XBRL Presentation Linkbase Document*

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

ZNERGY, INC.

By: /s/ Dave Baker Dave Baker Chief Executive Officer and Director (Principal Executive Officer) Date: ~~August~~July 122, ~~2019~~2021

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