UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended September 30, 2017

 

or

 

¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from _____to_____.

 

Commission File Number 000-55682

 

Dynamic Enviro, Inc.

(Exact name of small business issuer as specified in its charter)

 

FLORIDA		47-2239835
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

 

9100 Kiln Waveland Cutoff Road

Waveland, Mississippi 39520

(Address of principal executive offices)

 

800-793-0355

(Company’s telephone number, including area code)

 

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

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files).  Yes x  No ¨

 

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

 

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	x
Emerging growth company	x

 

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

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

The Company has 77,173,320 shares outstanding as of November 20, 2017

 

 

  

TABLE OF CONTENTS

 

		Page
	PART I — Financial Information	F-1
Item 1.	Financial Statements (unaudited)	F-1
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	3
Item 3.	Quantitative  and Qualitative Disclosures about Market Risk	7
Item 4.	Controls and Procedures	7
	PART II — Other Information	8
Item 1.	Legal Proceedings	8
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	8
Item 3.	Defaults Upon Senior Securities	8
Item 4.	Mine Safety Disclosures	8
Item 5.	Other Information	8
Item 6.	Exhibits	8
	Signatures	9

 

 

 

PART I – FINANCIAL INFORMATION 

 

DYNAMIC ENVIRO, INC.

Balance Sheets

(Unaudited)

 

			September 30, 2017			December 31, 2016
ASSETS
Current Assets
Cash		$	11,792		$	6,359
Accounts receivable			281,376			212,346
Prepaid expenses			17,531			23,640
Total Current Assets			310,699			242,345
Property and equipment; net of accumulated amortization of $164,967 and $272,728, respectively			273,500			45,248
Total Assets		$	584,199		$	287,593
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities
Cash overdraft		$			$
Accounts payable			255,361			156,568
Accrued expenses			338,735			193,261
Line of credit			100,662			100,561
Notes payable,			177,990			15,651
Capital lease obligation			57,844			—
Due to related party			33,852			30,085
Total Current Liabilities			964,444			496,126
Long Term Liabilities
Due to related party			6,269			8,297
Capital lease obligation			196,429			—
			1,167,142			504,423
Stockholders’ Deficit
Preferred Stock
Authorized: 30,000,000 shares, no par value Issued and Outstanding: 0 shares			—			—
Common Stock
Authorized: 200,000,000 shares, $0.0001 par value Issued and Outstanding:77,173,320 and 76,978,320 shares as of September 30, 2017 and December 31, 2016, respectively			7,718			7,698
Additional Paid-in Capital			242,044			222,564
Accumulated deficit			(832,705	)		(447,092	)
Total Stockholders’ Deficit			(582,943	)		(216,830	)
Total Liabilities and stockholders' deficit		$	584,199		$	287,593

 

(The accompanying notes are an integral part of these unaudited financial statements)

 

 

DYNAMIC ENVIRO, INC.

Statements of Operations

(Unaudited)

 

			For the Three Months Ended September 30,						For the Nine Months Ended September 30 ,
			2017			2016			2017			2016
Revenue		$	425,508		$	432,341		$	794,647		$	1,127,072
Cost of Revenue			308,543			344,518			663,647			786,798
Gross Profit			116,965			87,823			131,000			340,274
Operating Expenses
Depreciation expense			15,758			9,473			30,890			22,385
Gain on sale of equipment			(12,500	)		—			(45,039	)		—
General and administrative			152,235			104,601			511,868			389,717
Total Operating Expenses			155,493			114,074			497,719			412,102
Operating Loss			(38,528	)		(26,251	)		(366,719	)		(71,828	)
Other (Expenses)
Interest expense			(8,486	)		—			(18,894	)		—
Total Other Expenses			(8,486	)		—			(18,894	)		—
Net Income (Loss)		$	(47,014	)	$	(26,251	)	$	(385,613	)	$	(71,828	)
Net Income (Loss) Per Share, Basic and Diluted		$	(0.00	)	$	(0.00	)	$	(0.01	)	$	(0.00	)
Weighted Average Shares Outstanding, Basic and Diluted			77,173,320			76,884,896			76,991,331			76,656,605

 

(The accompanying notes are an integral part of these unaudited financial statements)

 

 

 

DYNAMIC ENVIRO, INC.

Statements of Cash Flows

(Unaudited)

 

			For The Nine Months Ended September 30,
			2017			2016
Cash Flows from Operating Activities
Net loss		$	(385,613	)	$	(71,828	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense			30,890			22,385
Gain on sale of property and equipment			(45,039	)		—
Stock issued for consulting services			5,000			16,500
Stock issued for director fees			500			—
Stock issued to employees			12,500			—
Stock issued for marketing services			—			—
Amortization of deferred financing cost			—			—
Amortization of original debt discount			5,000			—
Changes in operating assets and liabilities:
Accounts receivable			(69,030	)		(193,405	)
Prepaid expenses			6,109			—
Accounts payable and accrued expense			244,267			238,788
Net Cash (Used in) Provided by Operating Activities			(195,416	)		12,440
Cash Flows from Investing Activities
Proceeds from sale of property and equipment			62,522			—
Purchase of property and equipment			(7,698	)		(6,000	)
Net Cash Used in Investing Activities			54,824			(6,000	)
Cash Flows from Financing Activities
Credit lines			101			—
Payment on capital leases			(14,654	)		—
Proceeds from note payable			157,339			—
Repayment of note payable			—			(6,500	)
Repayment to related party			—			(13,014	)
Advances from related party			1,739
Proceeds received from subscription receivable			—			11,000
Proceeds received from issuance of common stock			1,500			24,000
Net Cash Provided by (Used in) Financing Activities			146,025			15,486
Net change in Cash			5,433			21,926
Cash - Beginning of Period			6,359			23,845
Cash - End of  Period		$	11,792		$	45,771
Supplemental disclosures of cash flow information:
Interest paid		$	3,057		$	—
Income taxes paid		$	—		$	—
Noncash investing and financing activities:
Vehicle acquired through capital lease		$	268,927		$	—
Note payable issued for vehicle acquired from related party		$	—		$	13,366

 

(The accompanying notes are an integral part of these unaudited financial statements)

 

 

 

 

DYNAMIC ENVIRO, INC.

Notes to the Unaudited Financial Statements

SEPTEMBER 30, 2017

 

1.	Nature of Operations

 

Dynamic Enviro, Inc. (the "Company"), was incorporated in the state of Florida on October 28, 2014. In January 2015, the Company assumed the principal business operations of Dynamic Environmental, Inc., a related company under common control with the same sole director as the Company, by continuing the principal business while Dynamic Environmental, Inc. ceased operations of its principal business. Therefore, the Company is considered a continuation of Dynamic Environmental, Inc. The transfer of the business from Dynamic Environmental, Inc. to the Company was accomplished solely through the transfer of the net assets of Dynamic Environmental to the Company and did not involve a merger, business combination, exchange of shares or other transaction under ASC 805. The transaction was accounted for as a transfer of a business between entities under common control and the financial statements included herein are presented as a retrospective combination of the entities for all periods presented as if the combination had been in effect since the inception of common control in accordance with ASC 805-50-45. The Company's principal business is the provision of environmental and disaster response services.

 

2.	Basis of Presentation

 

a)

Interim Financial Statements

 

The interim unaudited financial statements as of September 30, 2017, and for the nine months ended September 30, 2017 and 2016, have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information on the same basis as the annual financial statements and in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the Company's financial position, results of operations and cash flows for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected for a full year or for any future period. They do not include all of the information and footnotes required by GAAP for complete financial statements. Therefore, these financial statements should be read in conjunction with the Company's audited financial statements and notes thereto for the years ended December 31, 2016 and 2015.

 

b)

Going Concern

 

These financial statements have been prepared on a going concern basis which assumes the Company will be able to realize its assets and discharge its liabilities and commitments in the normal course of business for the foreseeable future. The Company has a working capital deficit of $653,745 at September 30, 2017 and has suffered net losses. The Company has funded activities to date from debt financings and earnings. These factors raise substantial doubt about the Company's ability to continue as a going concern. The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management intends to finance operating costs over the next twelve months with existing cash on hand and public issuance of common stock. While the Company believes that it will be successful in obtaining the necessary financing and generating revenue to fund its operations, meet regulatory requirements and achieve commercial goals, there are no assurances that such additional funding will be achieved and that it will succeed in its future operations.

  

  

 

3.	Property and Equipment

  

Property and equipment consisted of the following:

 

		September 30, 2017				December 31, 2016
Equipment		$	169,412			$	93,080
Vehicles			269,055				224,896
Total			438,467				317,976
Accumulated depreciation			(164,967)				(272,728	)
Balance		$	273,500			$	45,248

  

During the nine months ended September 30, 2017, the Company sold vehicles and cabinets with a net book value of $17,483 for proceeds of $62,522. The Company recognized a gain on sale of $45,039.

  

In March 2017, the Company leased a new vehicle with a $0 dollar purchase option at the end of the lease term. The Company determined the lease qualified as capital lease. The purchase price of the vehicle was $49,626. The Company agreed to pay a total of $59,238 over the 60 month term of the lease.

 

In June 2017, the Company leased a new vehicle with a $0 dollar purchase option at the end of the lease term. The Company determined the lease qualified as capital lease. The purchase price of the vehicle was $53,924. The Company agreed to pay a total of $63,532 over the 60 month term of the lease

 

In June 2017, the Company leased a new vehicle with a $0 dollar purchase option at the end of the lease term. The Company determined the lease qualified as capital lease. The purchase price of the vehicle was $85,320. The Company agreed to pay a total of $102,268 over the 60 month term of the lease

 

In September 2017, the Company leased a vacuum truck with a $0 dollar purchase option at the end of the lease term. The Company determined the lease qualified as capital lease. The purchase price of the vehicle was $87,755. The Company agreed to pay a total of $98,507 over the 60 month term of the lease

  

During the nine months ended September 30, 2017, the Company made a lease payments of $14,654 .

  

Future minimum lease payments:
2017		$	11,484
2018			48,209
2019			52,070
2020			56,246
2021			60,763
2022 and thereafter			25,501
Total minimum lease payments		$	254,273

  

During the nine months end September 30, 2017 and 2016 depreciation expense was $30,890, and $22,385, respectively

  

 

 

5.	Related Party Transactions

 

As of September 30, 2017 and December 31, 2016, the Company owes the President of the Company $27,769 and $26,030, respectively for advances payable to fund the Company. The amount is unsecured, non-interest bearing and due on demand. During the nine months ended September 30, 2017, the President advance $1,739 to the Company.

 

On April 13, 2016, the Company purchased a vehicle from the President of the Company for a total purchase price of $19,366. The $19,366 will be paid by a $6,000 down payment followed by monthly payments of $338 until the total balance is paid off. No Payments were made during the nine months ended September 30, 2017. As of September 30, 2017 and December 31, 2016, the Company owes the President of the Company $12,352 for the purchase of the vehicle, of which $6,083 and $4,055 were classified as short term, respectively. .

 

6.	Line of Credit

 

During the year ended December 31, 2016, the Company entered a credit line agreement with a non-related third party for $100,000. The loan is secured by certain assets of the Company, bears interest at a rate of 7.25% and is due on demand. As of September 30, 2017 and December 31, 2016 the Company has an outstanding balance of $100,662 and $100,561, respectively. During nine months ended September 30, 2017, the Company had proceeds of $24,544 and repaid $24,645 for the line of credit.

 

7.

Notes Payable

 

During the year ended December 31, 2013, the Company entered a loan agreement with a non-related third party for $32,651. The loan is unsecured, non-interest bearing and due on demand. During the year ended December 31, 2016, the Company made payments of $6,500 (2015 - $0), and no payments were made during the nine month ended September 30, 2017. As of December 31, 2016 and September 30, 2017, the Company owed $15,651.   On May 23, 2017, the Company entered into a loan agreement and received $30,000. The Company agreed to repay a total of $35,000 on July 3, 2017. The Company recorded an original issue discount of $5,000 and is amortizing over the term of the note. As of September 30, 2017 the Company amortized debt discount of $5,000.   In July The Company entered a loan agreement with a non-related third party for $113,500. The loan is unsecure and payable over 11 months. The Company has agreed to repay a total of $110,662.50. Payments are due daily in the amount of $651.93. As of September 30, 2017 the Company owed $93,470.   In August The Company entered a loan agreement with a non-related third party for $47,000. The loan is unsecure and payable over 6 months. The Company has agreed to repay a total of $52,875. Payments are due monthly. For months 1-2 The Company has agreed to make monthly payments of $9,830.84 and in month’s 3-6 payments of $8,303.34. As of September 30, 2017 the Company owed $38,869.

 

8.

Common Stock   During the nine months ended September 30, 2017, the Company issued 15,000 shares of common stock at $0.10 per share for cash proceeds of $1,500.   During the nine months ended September 30, 2017, the Company issued 5,000 shares of common stock with a fair value of $500 to a Board member as compensation.   During the nine months ended September 30, 2017, the Company issued 125,000 shares of common stock with a fair value of $12,500 to Company employees as compensation.   During the nine months ended September 30, 2017, the Company issued 50,000 shares of common stock with a fair value of $5,000 to a third party for the services to be rendered.

 

 

  

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

 

FORWARD-LOOKING STATEMENTS

 

This document contains “forward-looking statements”. All statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, including, but not limited to, any projections of earnings, revenue or other financial items; any statements of the plans, strategies and objections of management for future operations; any statements concerning proposed new services or developments; any statements regarding future economic conditions or performance; any statements or belief; and any statements of assumptions underlying any of the foregoing.

 

Forward-looking statements may include the words “may,” “could,” “estimate,” “intend,” “continue,” “believe,” “expect” or “anticipate” or other similar words. These forward-looking statements present our estimates and assumptions only as of the date of this report. Except for our ongoing securities laws, we do not intend, and undertake no obligation, to update any forward-looking statement.

 

Although we believe that the expectations reflected in any of our forward- looking statements are reasonable, actual results could differ materially from those projected or assumed in any or our forward-looking statements. Our future financial condition and results of operations, as well as any forward-looking statements, are subject to change and inherent risks and uncertainties. The factors impacting these risks and uncertainties include, but are not limited to:

 

·

Our results are vulnerable to economic conditions;

 

·

Our ability to raise adequate working capital;

 

·

Loss of customers or sales weakness;

 

·

Inability to achieve sales levels or other operating results;

 

·

The unavailability of funds for capital expenditures;

 

·

Operational inefficiencies;

 

·

Increased competitive pressures from existing competitors and new entrants.

 

DESCRIPTION OF BUSINESS

 

Organization

 

We were incorporated in the state of Florida on October 31, 2014. We have never been the subject of a material reclassification, merger, consolidation, or purchase or sale of a significant amount of assets not in the ordinary course. Further, we have never been the subject of a bankruptcy, receivership or similar proceeding.

 

 

 

Business

 

Our emergency response/emergency management services are available upon request in all 50 states. Based on our level of expertise we are commonly contracted to be present and assist with management and execution of environmental/emergency based situations throughout the USA. We currently have one regional service center, which is in Waveland, Mississippi and covers from Lafayette, Louisiana to Pensacola, Florida, which represents a 150-mile radius.

   

We provide services in 4 major categories, as follows:

 

(1)

Field and Industrial Services, i.e., above ground and underground storage tank (i.e. oil, chemical cleaning and removal)

 

(2)

Emergency Response and Disaster Recovery, i.e., oil spills, pipeline spills, avian bird flu

  

(3)

Waste Transportation and Disposal Services, i.e., disposal, landfill treatment, flood debris cleanup

 

(4)

Remediation and Construction Services, including site remediation and demolition

 

We intend to expand our business, as follows:

 

·

Secure agreements for our services in the industrial corridor between Lake Charles, Louisiana to Pensacola, Florida covering Louisiana, Mississippi, Alabama and Florida;

 

·

Build stronger relationships as a premier environmental contractor by securing client agreements leading to opening additional service centers;

 

·

Attempt to secure master service agreements with companies in need of environmental maintenance as well as an environmental responder if the need arises; and.

 

·

Establish Service Centers strategically located to cover an approximately 100-200-mile radius.

 

Service Center locations are a traditional format for conducting the environmental services business. Each Service Center will be a base of operations to provide environmental services for a radius of approximately 100 - 200 miles and will consist of a manager, foreman, multiple technicians, supplies and the necessary equipment to provide the environmental services. Our current headquarters in Waveland Mississippi is an active service center that will serve as a model for any new service centers. Our Chief Executive Officer will direct the establishment of each Service Center.

 

We plan on establishing our second Service Center in Northern, Florida to cover the territory from Lake Charges, Louisiana and Pensacola, Florida. Because this Service Center is contingent upon adequate funding and/or raising capital, we do not have a schedule for establishing this Service Center. Assuming we do receive adequate funds to establish the Northern, Florida Service Center, it will take approximately 3 months to become operational.

 

We intend to fund each Service Center through existing revenues and/or raising capital or a combination of the foregoing; however, there is no assurance that we will be successful in generating sufficient revenues or raising adequate capital.

 

Trends and Uncertainties

 

Our business is subject to the following trends and uncertainties:

 

·

The level of local, state and federal environmental regulation, which would positively or negatively affect the demand for our services;

 

·

The level of commercial and governmental business in the United States;

 

·

The political agenda of the Trump administration that will affect the level of environmental regulations and enforcement; and

 

·

Whether the level of our emergency response business will materially increase or decrease.

 

 

Going Concern

 

Our financial statements have been prepared on a going concern basis which assumes that we will be able to realize our assets and discharge its liabilities and commitments in the normal course of business for the foreseeable future. We had a working capital deficit of $653,745 at September 30, 2017 and a net loss of $385,613 for the nine months ended September 30, 2017. We have funded our activities to date from debt financings, the sale of common stock and revenues generated. These factors raise substantial doubt about our ability to continue as a going concern. Our ability to continue as a going concern is dependent upon our generating profitable operations in the future and/or to obtain the necessary financing to meet our obligations and repay our liabilities arising from normal business operations when they come due. Our management intends to finance operating costs over the next twelve months with existing cash on hand and public issuance of common stock. While we believe that we will be successful in obtaining the necessary financing and generating revenue to fund our operations, meet regulatory requirements and achieve commercial goals, there are no assurances that such additional funding will be achieved and that we will succeed in our future operations.

 

We will attempt to overcome the going concern opinion by increasing our revenues, as follows:

  

·

Expansion of our business by securing agreements for our services;

 

·

Build stronger relationships by securing client agreements leading to opening additional service centers;

 

·

Secure master service agreements;

 

·

Establish a service center in Northern Florida;

 

·

Marketing services; and

 

·

Obtaining financing.

 

Our attempt to overcome the going concern opinion may fail since all of the above will lead to increased expenses and possible net losses.

 

COMPARATIVE RESULTS FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2017 AND SEPTEMBER 30, 2016

 

Revenues

 

Our revenues for the three months ended September 30, 2017 and 2016 were $425,508 and $432,341, respectively, reflecting slightly decreased revenues of $6,833. Our revenues for the nine months ended September 30, 2017 and 2016 were $796,647 and $1,127,072, respectively, reflecting decreased revenues of $332,455. The decrease in our revenues is attributable to additional lower than expected remedial and emergency response projects during the first half of 2017. For the three months ended September 30, 2017 the Company did several large remediation projects associated with natural disasters in Texas and Florida.

 

As an emergency response company, our revenues have historically been contingent upon the occurrence of emergency incidents and the corresponding need for our services. Apart from whether the level of our emergency response business will materially increase or decrease contingent upon the occurrence of such emergency incidents, there are no known trends and uncertainties that are attributable to our decreased revenues or revenues in the immediate future. Additionally, there have been no increased prices or introduction of new services that were factors in our increased revenues.

 

 

 

Operating Expenses

 

We incurred total operating expenses of $155,493and $144,074 for the three months ended September 30, 2017 and 2016, reflecting an increase of $41,419 for the three months ending September 30, 2017. We incurred total operating expenses of $497,719 and $412,102 for the nine months ended September 30, 2017 and 2016, reflecting an increase of $85,617 for the nine months ending September 30, 2017. The increase is primarily attributable to additional employees being added and increased professional fees.

 

Net Loss

 

We had a net loss of ($47,014)  for the three months ended September 30, 2017 and ($26,251) for the three months ended September 30, 2016, reflecting increased losses of ($20,763)  for the three months ended September 30, 2017. We had a net loss of ($385,613)  for the nine months ended September 30, 2017 and net loss of ($71,828) for the nine months ended September 30, 2016, reflecting increased losses of ($313,785)  for the 9 months ended September 30, 2017. The increased loss for the three and nine months ended September 30, 2017 is primarily attributable to 2017 is primarily attributable to lower than expected revenue and additional employees being added and increased professional fees.

 

Liquidity and Capital Resources

 

We had a working capital deficit of $653,745 for the nine months ended September 30, 2017 and a working capital deficit of $253,781 for our fiscal year ended December 31, 2016, representing a $399,964 increase in working capital deficit, which is primarily attributable to increased accounts receivable and increased accounts payable and accrued expensed during the nine months ended September 30, 2017.

 

Our net cash (used in) operating activities was ($195,416) for the nine-month period ended September 30, 2017, compared to $12,440 for the nine months ended September 30, 2016 reflecting decreased operating activities of ($207,856), which is primarily attributable to increased loss and accounts receivable which was partially offset by increased accounts payable and accrued expenses.

 

Our net cash provided by / (used in) investing activities were $54,824 and ($6,000), respectively, for the nine months ended September 30, 2017 and 2016, the increase is attributable to sale of certain property and equipment which was partially offset by purchase of property and equipment.

 

Our net cash flows provided by financing activities was $146,025 for the nine months ended September 30, 2017 compared to $15,486 for the nine months ended September 30, 2016, representing a $130,539 increase in cash flows provided by operating activities mainly due to increase in borrowings.

 

Liquidity and Capital Resources

 

Going forward, our cash needs over the next 12 months from September 30, 2017, include the following estimated expenditures: (a) payroll – $401,400; (b) Insurance - $54,000; (c) equipment rental - $114,000; (d). lodging beyond 65 miles of our headquarters office - $189,000; (e) new service center - $187,080

 

Separate and apart from the above expenses, we estimate that we will incur approximately $105,000 of marketing expenses that we anticipate over the next 12 months from September 30, 2017.

 

These estimated expenditures are based on expenses from fiscal year 2016 and our increased emergency response projects over the last 2 years. These numbers will be drastically affected by whether we are successful in establishing a new service center and the volume of work; therefore, if we are unsuccessful in establishing a new service center and/or if workload happens to decrease our expenditures will correspondingly decrease.

 

We plan on meeting our cash needs, including SEC reporting costs, by: (a) attempting to increase our revenues through increased marketing; (b) securing additional master service agreements; and (c) obtaining financing through a debt or equity offering.

 

There is no assurance that we will secure additional capital. There currently are no agreements, arrangements, or understandings that would enable us to obtain funds through bank loans, lines of credit, or any other source.

 

 

 

Off-Balance sheet arrangements

 

None.

 

Item 3.   Quantitative and Qualitative Disclosures About Market Risk.

 

Not applicable

 

Item 4.   Controls and Procedures.

 

Disclosure Controls and Procedures

 

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

 

As required by SEC Rule 15d-15(b), we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report. Based on the foregoing, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective as of September 30, 2017.

 

Changes in Internal Control over Financial Reporting

 

There were no changes in our internal control over financial reporting that occurred during our most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.  We will continue to evaluate the effectiveness of internal controls and procedures on an on-going basis.

  

PART II – OTHER INFORMATION

 

Item 1.   Legal Proceedings.

 

We know of no material pending legal proceedings to which our company or our subsidiary is a party or of which any of our properties, or the properties of our subsidiary, is the subject. In addition, we do not know of any such proceedings contemplated by any governmental authorities.

 

We know of no material proceedings in which any of our directors, officers or affiliates, or any registered or beneficial stockholder is a party adverse to our company or our subsidiary or has a material interest adverse to our company or our subsidiary.

 

 

 

Item 1A.   Risk Factors

 

As a smaller reporting company, we are not required to provide risk factors; however, you may review risk factors in our S-1 Registration Statement beginning at page 7, at the following link: https://www.sec.gov/Archives/edgar/data/1643930/000114420416117507/v446392_s1a5.htm.

 

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

 

Item 3.   Defaults Upon Senior Securities

 

None

 

Item 4.   Mine Safety Disclosures.

 

None

 

Item 5.   Other information

 

None.

 

Item 6.   Exhibits.

 

EXHIBIT INDEX

 

Exhibit Number		Description
31.1		Certifications of the Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2		Certifications of the Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1		Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2		Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS		XBRL Instance Document
101.SCH		XBRL Taxonomy Extension Schema Document
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB		XBRL Taxonomy Extension Label Linkbase Document
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document

 

 

  

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.

 

Date: November 20, 2017

 

DYNAMIC ENVIRO, INC.
By:       /s/ Brant Cochran
Name: Brant Cochran
Chief Executive Officer
(Principal Executive Officer & Chief Executive Officer)

  

By:       /s/ Alfred Chisholm
Name: Alfred Chisholm
Chief Financial Officer
(Chief Financial Officer/Chief Accounting Officer)