What changed in this filing

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Item 2. Management’s Discussion and Analysis

2023-08-21 compared with 2023-05-22 · 140 added, 115 removed, 145 unchanged (64% of the section changed)

17 unchanged sentences

(“the Company” or “SEER”) was originally organized under the laws

of the State of Nevada on February 13, 2002 for the purpose of acquiring one or more businesses, under the name of Satellite Organizing

Solutions, Inc.

In January 2008, SOZG changed its name to Strategic Environmental & Energy Resources, Inc.,

reduced its number of outstanding shares through a reverse stock split and consummated the acquisition of both, REGS, LLC and Tactical

Cleaning Company, LLC.

SEER is dedicated to assembling complementary service and environmental, clean-technology businesses that provide

safe, innovative, cost effective, and profitable solutions in the environmental, waste management and renewable energy industries.

currently operates five companies with four offices in the western and mid-western U.S.

Through these operating companies, SEER provides

products and services throughout the U.S.

and has licensed and owned technologies with many customer installations throughout the U.S.

Each of the five operating companies, which includes our majority owned entities, is discussed in more detail below.

of the State of Nevada on February 13, 2002.

SEER is dedicated to assembling complementary service and clean-technology environmental

businesses that provide safe, innovative, cost effective, and profitable solutions in the environmental, waste management and renewable

energy industries.

SEER currently operates four companies.

Through these operating companies, SEER provides products and services throughout

North America.

Some of SEER’s current customers include Cargill, ConAgra, Simplot, JBS, and many other companies in the food, beverage,

and agricultural space, as well as water treatment and landfill businesses.

Company’s domestic strategy is to grow internally through SEER’s subsidiaries that have well established revenue streams

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to place these innovations and solutions into the growing markets of emission capture and control, renewable “green gas”

capture and sale, compressed natural gas fuel generation, as well as general solid waste and medical/pharmaceutical waste destruction.

Many of SEER’s current operating companies share customer bases and each provides synergistic services, technologies and products.

Company now owns and manages three operating entities and two entities that have no significant operations to date, as REGS was abandoned

during the third fiscal quarter of 2021.

References in this report to abandoned or abandonment refer to the Company’s determination

not to provide financial support to, or conduct operations in or through, REGS.

capture and sale, as well as general solid waste and medical/pharmaceutical waste destruction.

Many of SEER’s current operating

companies share customer bases and each provides synergistic services, technologies and products.

LLC (d/b/a MV Technologies), (“MV”) :

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(formed September 2015) is a wholly owned subsidiary established as a materials

technology business with the purpose of developing advanced chemical absorbents and catalysts that enhance the capability of biogas produced

from, landfill, wastewater treatment operations and agricultural digester operations.

technology business with the original purpose of developing advanced chemical absorbents and catalysts that enhance the capability of

biogas produced from, landfill, wastewater treatment operations and agricultural digester operations.

January 1, 2023, the operations

of SEM were discontinued.

Results for the six months ended June 30, 2023 and 2022 are included in discontinued operations.

remains active and will now be used to form a joint venture to manufacture licensed biochar products and/or process and repurpose windmill

The initial facility is currently targeted for Texas.

Waste Solutions, LLC (“PWS”):

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PWS is a 54% owned subsidiary.

recently sold certain assets and its technology and associated IP to its joint venture partner, Paragon Southwest Medical Waste, LLC

(“PSMW”)(see below).

The sale was a unit transfer transaction.

PWS retained certain international rights and continues to

promote and market the CoronaLux technology in international markets.

(“Reach” or “Benefuels”) (trade name for Benefuels, LLC):

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develops renewable natural gas projects that convert raw biogas into pipeline quality gas and/or Renewable, “RNG”, for fleet

Reach has had minimal operations as of December 31, 2022.

Reach has had minimal operations as of June 30, 2023.

LLC (“PelleChar”):

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sales effort.

Revenue and expenses of PelleChar were not material for the year ended December 31, 2022.

MWS Joint Venture :

In October 2014, PWS and Medical Waste Services, LLC (“MWS”) formed a contractual joint venture to

exploit the PWS medical waste destruction technology.

In 2015, MWS licensed and installed a CoronaLux™ unit at an MWS facility,

and subsequently received a limited permit to operate from the South Coast Air Quality Management District (“SCAQMD”) and

the California Department of Public Health.

In November 2017, PWS received final air quality permit approval from SCAQMD allowing for

full operations of the CoronaLux™ unit at the MWS facility.

Southwest Joint Venture :

In December 2017, PWS and GulfWest Waste Solutions, LLC (“GWWS”) formed Paragon Southwest Medical

Waste, LLC (“PSMW”) to exploit the PWS medical waste destruction technology.

PSMW has an exclusive license to the CoronaLux™

technology in a six-state area of the Southern United States.

In 2017, PSMW purchased and installed three CoronaLux™ units at an

PSMW facility.

In July 2022, the Company exchanged its patents and related technology to its joint venture, PSMW, in exchange for units

Revenue and expenses of PelleChar were not material for the six months ended June 30, 2023.

Paragon Southwest Joint Venture:

In December 2017, PWS and GulfWest Waste Solutions, LLC (“GWWS”) formed Paragon Southwest Medical Waste, LLC (“PSMW”)

to exploit the PWS medical waste destruction technology.

PSMW has an exclusive license to the CoronaLux™ technology in a six-state

area of the Southern United States.

In 2017, PSMW purchased and installed three CoronaLux™ units at an PSMW facility.

In July 2022,

the Company exchanged its patents and related technology to its joint venture, PSMW, in exchange for units in PSMW.

The Company’s interest in PSMW was converted to a 2% interest in Amlon Holdings in June 2023 when PSMW was acquired by Amlon Holdings.

On December 17, 2022, SEER and Eco Tadweer (“ET”), a business entity incorporated in the Kingdom of Saudi

Arabia (“KSA”) entered into a joint venture with SEER owning a minority, non-controlling 49% interest in the joint venture.

The purpose of the joint venture is to market and monetize SEER’s technologies in and around the KSA.

While SEER is entitled to

appoint one of three managers, ET is responsible for funding, operation and management of the joint venture.

Financial Condition and Liquidity

shown in the accompanying consolidated financial statements, the Company has experienced recurring losses, and has accumulated a deficit

of approximately $32.8 million as of March 31, 2023, and $32.0 million as of December 31, 2022.

For the three months ended March 31,

2023, the Company incurred a net loss of approximately $0.8 million and for the three months ended March 31, 2022, the Company incurred

a net loss of approximately $0.4 million.

The Company had a working capital deficit of approximately $10.2 million as of March 31, 2023,

and a working capital deficit of $9.4 million as of December 31, 2022.

These factors raise substantial doubt about the ability of the

Company to continue to operate as a going concern.

of a major portion of the Company’s assets as of March 31, 2023, is dependent upon continued operations.

of approximately $33.2 million as of June 30, 2023, and $32.0 million as of December 31, 2022.

For the six months ended June 30, 2023,

the Company incurred a net loss of approximately $1.2 million and for the six months ended June 30, 2022, the Company incurred a net

loss of approximately $0.9 million.

The Company had a working capital deficit of approximately $10.6 million as of June 30, 2023, and

a working capital deficit of $9.4 million as of December 31, 2022.

These factors raise substantial doubt about the ability of the Company

to continue to operate as a going concern.

of a major portion of the Company’s assets as of June 30, 2023, is dependent upon continued operations.

The Company is dependent

on generating additional revenue or obtaining adequate capital to fund operating losses until it becomes profitable.

For the three months

ended March 31, 2023, the Company raised approximately $0.7 million from the issuance of short-term and long-term debt, for a net cash

For the six months

ended June 30, 2023, the Company raised approximately $0.9 million from the issuance of short-term and long-term debt, for a net cash

provided by financing activities of approximately $0.7 million.

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the Company be unable to report on a going concern basis.

of Operations for the Three Months Ended March 31, 2023, and 2022

revenues were $0.6 million and $0.8 million for the three months ended March 31, 2023, and 2022, respectively.

of Operations for the Three Months Ended June 30, 2023, and 2022

revenues were $0.7 million and $1.1 million for the three months ended June 30, 2023, and 2022, respectively.

The decrease of

approximately $0.2 million or 25% in revenues comparing the three months ended March 31, 2023, to the three months ended March 31,

approximately $0.4 million or 34% in revenues comparing the three months ended June 30, 2023, to the three months ended June 30,

2022, is attributable to the decreases in revenues from our products segment revenue, which includes our environmental solutions

segment, which decreased to approximately $0.6 million for the three months ended March 31, 2023, from approximately $0.8 million

for the three months ended March 31, 2022.

expenses, which include cost of products, cost of solid waste and general and administrative (G&A) expenses, and salaries and

related expenses, were approximately $1.1 million for the three months ended March 31, 2023 and approximately $1.2 million for the

three months ended March 31, 2022.

Product costs decreased $0.1 million for the three months ended March 31, 2023, compared to the

three months ended March 31, 2022.

non-operating expense, net was $0.2 million for the three months ended March 31, 2023, compared to $15,400 expense for the three

months ended March 31, 2022.

During the three months ended March 31, 2022, the Company recorded $0.1 million in gain on debt

extinguishment, which resulted from the forgiveness of the Company’s PPP Loans from the US Treasury, and approximately $0.1

million gain on the exchange of convertible units in a joint venture for an outstanding debt and liabilities.

These gains were

offset by $0.2 million in interest expense, which is comparable to interest expense of $0.2 million for the three months ended March

is no provision for income taxes for both the three months ended March 31, 2023, and 2022, due to our net losses for both periods and

we continue to maintain full allowances covering our net deferred tax benefits as of March 31, 2023, and 2022.

from continuing operations was approximately $0.8 million and $0.4 million, for the three months ended March 31, 2023 and 2022,

respectively.

The net income attributable to SEER after adding $2,800 for the non-controlling interest and deducting $11,700 from

loss on discontinued operations was $0.8 million for the three months ended March 31, 2023, as compared to a net loss of $0.4

million, after deducting $4,100 in non-controlling interest and deducting $21,300 loss from discontinued operations, for the three

months ended March 31, 2022.

As noted above, an increase in operating expenses, reducing margins increased net loss by $0.5

of Discontinued Operations for the Three Months Ended March 31, 2023 and 2022

of March 31, 2023, the Company abandoned its SEM subsidiary.

Our product percent-complete contract revenue decreased due to several material projects being postponed due to site

preparation delays.

expenses, which include cost of products, cost of solid waste, general and administrative (G&A) expenses, and salaries and related

expenses, were approximately $1.1 million for the three months ended June 30, 2023 and approximately $1.4 million for the three months

ended June 30, 2022.

Product costs decreased $0.3 million for the three months ended June 30, 2023, compared to the three months ended

June 30, 2022, due to above mentioned percent-complete project delays.

other income and expense was a net expense of $0.2 million for both the three months ended June 30, 2023 and 2022.

The majority of other

income and expense is interest expense, with was consistent at $0.2 million for both the three months ended June 30, 2023 and 2022.

is no provision for income taxes for both the three months ended June 30, 2023, and 2022, due to our net losses for both periods and

we continue to maintain full allowances covering our net deferred tax benefits as of June 30, 2023, and 2022.

from continuing operations was approximately $0.6 million and $0.5 million, for the three months ended June 30, 2023 and 2022, respectively.

The net loss attributable to SEER after adding $2,100 for the non-controlling interest and deducting $0.2 million of income from discontinued

operations was $0.4 million for the three months ended June 30, 2023, as compared to a net loss of $0.5 million, after deducting $18,200

in non-controlling interest and deducting $34,000 loss from discontinued operations, for the three months ended June 30, 2022.

above, income from discontinued operations, partially offset by a decrease in revenue, decreased net loss by $0.1 million.

of Operations for the Six Months Ended June 30, 2023, and 2022

revenues were $1.3 million and $1.9 million for the six months ended June 30, 2023, and 2022, respectively.

The decrease of

approximately $0.6 million or 33% in revenues comparing the six months ended June 30, 2023, to the six months ended June 30, 2022,

is attributable to the decreases in revenues from our products segment revenue, which includes our environmental solutions segment,

and our solid waste segment.

Our product percent-complete contract revenue decreased due to several material projects being

postponed due to site preparation delays.

Our solid waste segment also decreased $0.1 million, as we no longer collect a management

fee from our PWS subsidiary.

expenses, which include cost of products, cost of solid waste, general and administrative (G&A) expenses, and salaries and related

expenses, were approximately $2.3 million for the six months ended June 30, 2023 and approximately $2.6 million for the six months ended

June 30, 2022.

Product costs decreased $0.3 million for the six months ended June 30, 2023, compared to the six months ended June 30,

2022 due to above mentioned percent-complete project delays.

other income and expense was a net expense of $0.4 million for the six months ended June 30, 2023, compared to $0.2 million for the

six months ended June 30, 2022.

The majority of other income and expense is interest expense, with was consistent at $0.4 million

for both the six months ended June 30, 2023 and 2022.

The prior year period also included a $0.1 million gain on debt extinguishment

from the forgiveness of the Company’s PPP Loans from the US Treasury.

is no provision for income taxes for both the six months ended June 30, 2023, and 2022, due to our net losses for both periods and we

continue to maintain full allowances covering our net deferred tax benefits as of June 30, 2023, and 2022.

from continuing operations was approximately $1.4 million and $0.9 million, for the six months ended June 30, 2023 and 2022, respectively.

The net income attributable to SEER after adding $700 for the non-controlling interest and $160,300 gain from discontinued operations

was $1.2 million for the six months ended June 30, 2023, as compared to a net loss of $0.9 million, after deducting $22,200 in non-controlling

interest and deducting $0.1 million loss from discontinued operations, for the six months ended June 30, 2022.

As noted above, the decrease

in margin, prior years gain on debt distinguishment, partially offset by current year’s income from discontinued operations, increased

net loss by $0.3 million.

of Discontinued Operations for the Six Months Ended June 30, 2023 and 2022

of January 1, 2023, the Company abandoned its SEM subsidiary.

All revenue and expenses of our SEMS subsidiary for 2023 are classified

as discontinued operations.

For the three months ended

For the Six Months ended

Services revenue

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Total income (loss) from discontinued operations

is no provision for income taxes for both the three months ended March 31, 2023, and 2022, due to our net loss carryforwards and we continue

to maintain full allowances covering our net deferred tax benefits as of March 31, 2023 and 2022.

Company had net cash used by operating activities for the three months ended March 31, 2023, and 2022 of $0.6 million and $0.4

million, respectively.

Cash used by operating activities is driven by our net loss and adjusted by non-cash items as well as changes

in operating assets and liabilities.

is no provision for income taxes for both the six months ended June 30, 2023, and 2022, due to our net loss carryforwards and we continue

to maintain full allowances covering our net deferred tax benefits as of June 30, 2023 and 2022.

Company had net cash used by operating activities for the six months ended June 30, 2023, and 2022 of $1.0 million and $0.4 million,

respectively.

Cash used by operating activities is driven by our net loss and adjusted by non-cash items as well as changes in operating

assets and liabilities.

Non-cash adjustments primarily include depreciation and amortization of intangible assets.

loss of $0.4 million for the three months ended March 31, 2022 increased to $0.8 million for the three months

ended March 31, 2023.

Non-cash adjustments decreased cash uses of $5,600 for the three months ended March 31, 2023, compared to cash

uses of $30,300 for the three months ended March 31, 2022.

Net loss of $0.9 million

for the six months ended June 31, 2022 increased to $1.2 million for the six months ended June 30, 2023.

Non-cash adjustments increased

cash uses of $0.2 million for the six months ended June 30, 2023, compared to cash uses of $17,800 for the six months ended June 30,

addition to the non-cash adjustments to net income, changes in assets and liabilities include:

a) changes in inventory used

approximately $14,700 in cash in the first three months of 2023, compared to providing $71,300 in the first three months of 2022, b) changes in prepaid expenses and other assets used approximately $73,800 in the

first three months of 2023, compared to using $70,000 in the first three months of 2022, c) changes in accounts payable, accrued liabilities, and customer deposits used $72,100 in the first three months of 2023,

compared to providing $274,400 in the first three months of 2022, d)

changes in contract liabilities used $89,800 in the first three months of 2023, compared to using $2,400 in the first three months

cash used by investing activities was $28,300 for the three months ended March 31, 2022.

There was no cash used in investing activities

for the three months ended March 31, 2023.

cash provided by financing activities was approximately $0.7 million for the three months ended March 31, 2023, compared with providing

$0.3 million for the three months ended March 31, 2022.

in accounts payable, accrued liabilities, and customer deposits provided $0.2 million in the first six months of 2023, compared to

providing $0.8 million in the first six months of 2022,

in contract assets provided $0.1 million in the first six months of 2023, compared to using $0.2 million in the first six months

in contract liabilities used $23,000 in the first six months of 2023, compared to using $0.2 million in the first three months of

in accounts receivable provided $0.1 million in the first six months of 2023, compared to using $27,600 in the first three months

cash provided by investing activities was $0.3 million for the six months ended June 30, 2023, compared to a use of $31,800 for the six

months ended June 30, 2022.

The Company sold fixed assets during the current year and collected $0.3 million.

cash provided by financing activities was approximately $0.7 million for the six months ended June 30, 2023, compared with providing

$0.3 million for the six months ended June 30, 2022.

The Company’s financing activities for both periods consist of new borrowing,

net of any principal payments made during the period.

Accounting Policies, Judgments and Estimates

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of revenues and expenses during the period.

Significant items subject to such estimates and assumptions include the carrying amount of

intangible assets;

valuation allowances and reserves for receivables, inventory and deferred income taxes;

revenue recognition related

to contracts accounted for under the percentage of completion method;

share-based compensation;

and loss contingencies, including those

related to litigation.

Significant items subject to such estimates and assumptions include the forecasted cash flows

used in the impairment testing of goodwill and intangible assets.

The carrying amount of intangible assets;

valuation allowances and

reserves for receivables;

revenue recognition related to contracts accounted for under the percentage of completion method;

and the Company’s

ability to continue as a going concern.

Actual results could differ from those estimates.

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for recovery is remote.

An allowance for doubtful accounts of approximately $179,000 has been reserved as of March 31, 2023, and December

An allowance for doubtful accounts of approximately $179,000 has been reserved as of June 30, 2023, and December

Company is exposed to credit risk in the normal course of business, primarily related to accounts receivable.

Our customers operate primarily

in the biogas generating and wastewater treatment industries in the United States.

Accordingly, we are affected by the economic conditions

in these industries as well as general economic conditions in the United States.

To limit credit risk, management periodically reviews

and evaluates the financial condition of its customers and maintains an allowance for doubtful accounts.

As of March 31, 2023, and December

31, 2022, we do not believe that we have significant credit risk.

in the food, beverage, and agricultural space, as well as water treatment and landfill industries in the United States.

we are affected by the economic conditions in these industries as well as general economic conditions in the United States.

credit risk, management periodically reviews and evaluates the financial condition of its customers and maintains an allowance for doubtful

As of June 30, 2023, and December 31, 2022, we do not believe that we have significant credit risk.

Value of Financial Instruments

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and timing of estimated future cash flows.

No impairments were determined as of March 31, 2023.

No impairments were determined as of June 30, 2023.

is recognized under FASB guidelines, which requires an evaluation of revenue arrangements with customers following a five-step approach:

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis