10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549   

FORM 10-Q 

☒            Quarterly report pursuant Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended March 31, 2017

☐            Transition report pursuant Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from _______ to _______

000-55152

(Commission file number)

ZNERGY, INC.

(Exact name of registrant as specified in its charter)

Nevada	46-1845946
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

6102 South MacDill Avenue, Suite G Tampa, FL 33611	33611
(Address of principal executive offices)	(Zip Code)

800-931-5662

(Registrant’s telephone number, including area code)

MAZZAL HOLDING CORP.

(Former name, former address and former fiscal year, if changed since last report)

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 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 ☐                               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 ☐  (Do not check if a smaller reporting company)	Smaller reporting company ☒
Emerging growth company ☐

If an emerging growth company, indicate by check mark if he 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 ☒

On May 10, 2017, there were 200,150,000 shares of the registrant’s common stock outstanding.

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION			3
	Item 1.	Condensed Consolidated Financial Statements	3
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	11
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	16
	Item 4.	Controls and Procedures	16
Part II - OTHER INFORMATION			17
	Item 1.	Legal Proceedings	17
	Item 5.	Other Information	17
	Item 6.	Exhibits	18
SIGNATURES			19

PART I - FINANCIAL INFORMATION

Item 1.          Condensed Consolidated Financial Statements

ZNERGY, INC.

INDEX TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

CONTENTS:
Condensed Consolidated Balance Sheets as of March 31, 2017 (unaudited), and December 31, 2016	4
Condensed Consolidated Statements of Operations for the three months ended March 31, 2017 and 2016 (unaudited)	5
Consolidated Statement of Changes in Stockholders’ Deficit for the three months ended March 31, 2017 (unaudited) and for the year ended December 31, 2016	6
Condensed Consolidated Statement of Cash Flows for the three months ended March 31, 2017 and 2016 (unaudited)	7
Notes to Condensed Consolidated Unaudited Interim Financial Statements	8

3

ZNERGY, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

as of

	March 31,			December 31,
	2017			2016
	(UNAUDITED)
ASSETS
CURRENT ASSETS
Cash	$	18,494		$	40,507
Accounts receivable		116,690			79,612
Prepaid expenses		2,500			3,750
Inventory		190,694			192,105
Total current assets		328,378			315,974
Furniture & equipment, net		2,333			2,567
Intangible assets, net		1,845			1,845
TOTAL ASSETS	$	332,556		$	320,386
LIABILITIES AND STOCKHOLDERS’ DEFICIT
CURRENT LIABILITIES
Accounts payable	$	281,857		$	284,930
Accrued expenses		126,385			139,336
Customer deposits		-			6,605
Advances from third parties		80,750			60,000
Loan from related party		143,622			135,749
Total current liabilities		632,614			626,620
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ DEFICIT
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; 200,150,000 and 193,150,000 shares issued and outstanding at March 31, 2017 and December 31, 2016		20,015			19,315
Additional paid-in-capital		8,409,588			7,626,099
Accumulated deficit		(8,729,661	)		(7,951,648	)
Total stockholders’ deficit		(300,058	)		(306,234	)
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT	$	332,556		$	320,386

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 MONTHS ENDED

(Unaudited)

	March 31,			March 31,
	2017			2016
Revenue	$	143,679		$	6,080
Cost of revenue		58,046			-
Gross profit		85,633			6,080
Selling, general and administrative expenses		863,646			37,320
Loss from operations		(778,013	)		(31,240	)
Provision for income taxes		-			-
Net loss	$	(778,013	)	$	(31,240	)
Net loss per common share - basic and diluted	$	(0.00	)	$	(0.00	)
Weighted average number of shares outstanding    - basic and diluted		196,015,000			245,245,652

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

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ZNERGY, INC.

CONSOLIDATED STATEMENT OF CHANGE IN STOCKHOLDERS’ (DEFICIT)

FOR THE THREE MONTHS ENDED MARCH 31, 2017

(Unaudited)

													Total
						Additional							Stockholders’
	Common Stock					Paid in			Accumulated				Equity
	Shares		Amount			Capital			Deficit				(Deficit)
Balance at December 31, 2016		193,150,000		$	19,315		$	7,626,099		$	(7,951,648	)		$	(306,234	)
Shares issued for services		7,000,000			700			724,300			-				725,000
Stock options		-			-			59,189			-				59,189
Net loss											(778,013	)			(778,013	)
Balance at March 31, 2017		200,150,000		$	20,015		$	8,409,588		$	(8,729,661	)		$	(300,058	)

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

FOR THE THREE MONTHS ENDED

(unaudited)

	March 31,			March 31,
	2017			2016
CASH FLOWS USED IN OPERATING ACTIVITIES:
Net loss	$	(778,013	)	$	(31,240	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		234			1,250
Common stock and options issued for services		784,189			-
Contributed services		-			10,640
Accounts receivable		(37,078	)		(3,280	)
Prepaid expenses		1,250			-
Inventory		1,411			-
Accounts payable & accrued expenses		(16,024	)		1,644
Customer deposits		(6,605	)		-
Net cash used in operating activities		(50,636	)		(20,986	)
CASH FLOWS USED IN INVESTING ACTIVITIES:
Cash transferred to prior shareholder		-			(1,213	)
Net cash used in  investing activities		-			(1,213	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from advances from third parties		20,750			-
Proceeds from loan from related party		7,873			26,300
Net cash provided by financing activities		28,623			26,300
INCREASE (DECREASE) IN CASH		(22,013	)		4,101
CASH, BEGINNING OF PERIOD		40,507			1,279
CASH, END OF PERIOD	$	18,494		$	5,380
Supplemental Disclosures
Non-cash investing and financing activities:
Transfer of assets and liabilities to related party         for return of common shares	$	-		$	1,018,679

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

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ZNERGY, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2017 (UNAUDITED)

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”), incorporated on January 23, 2013. The original business plan of the Company was the construction and management of multi-family home developments and the subsequent sale thereof.

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.  The Company is now focused solely on the EE marketplace with an emphasis on LED retrofitting and relamping.

Basis of Presentation

The accompanying interim condensed consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and the instructions to Form 10-Q and do not include all of the information and footnotes required by GAAP for complete financial statements. All intercompany transactions have been eliminated in consolidation.

Certain information and footnote disclosures normally included in the Company’s annual audited consolidated financial statements and accompanying notes have been condensed or omitted in these interim condensed consolidated financial statements. Accordingly, the unaudited condensed consolidated financial statements included herein should be read in conjunction with the audited condensed consolidated financial statements for the year ended December 31, 2016, as filed with the Securities and Exchange Commission (“SEC”) on Form 10-K.

The results of operations presented in this quarterly report are not necessarily indicative of the results of operations that may be expected for any future periods. In the opinion of management, these unaudited condensed consolidated financial statements include all adjustments and accruals, consisting only of normal recurring adjustments that are necessary for a fair presentation of the results of all interim periods reported herein.

Consolidation

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

NOTE 2 – 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, 2017, the Company has a working capital deficit of $304,236, insufficient cash resources to meet its planned business objectives and accumulated losses from operations of $8,729,661. The Company intends to fund operations through equity financing arrangements, which may be insufficient to fund its capital expenditures, working capital and other cash requirements through March 2018.

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. The accompanying condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

NOTE 3 – INTANGIBLE ASSETS

The Company was granted a federally registered trademark for “ZNERGY”. The cost of applying for and prosecuting this trademark was $1,845 which cost was accounted for as a non-amortizing intangible asset.

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ZNERGY, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2017 (UNAUDITED)

NOTE 4 – LOANS FROM RELATED PARTY

	March 31, 2017		December 31, 2016
Loans from related party	$	143,622	$	135,749

The above loans at March 31, 2017 are from B2 Opportunity Fund, LLC, a major shareholder of the Company, and are unsecured, bear no interest and are repayable on demand.

NOTE 5 – STOCKHOLDERS’ EQUITY

Common Stock

On January 25, 2017 the Company appointed Richard Mikles as Chairman of the board of directors and issued to Mr. Mikles 3,000,000 shares of its common stock vested immediately, and 4,000,000 options to purchase shares of common stock of the Company at a price of $0.10 per share said options vesting equally over eight quarters and having an expiration of three years from the date of issue. Concomitantly, the Company entered into a consulting agreement with Mr. Mikles to provide marketing, strategic, and organizational services to the Company.  Upon execution of this consulting agreement the Company issued 2,000,000 shares of common stock, vested immediately, and 5,000,000 options to purchase shares of common stock of the Company at a price of $0.10 per share said options to vest quarterly in the amount of one option for every two dollars of revenue recognized by the Company.

On January 27, 2017 the Company appointed Kevin Harrington to its Board of Directors and issued 2,000,000 shares of its common stock, vested immediately, and 4,000,000 options to purchase shares of common stock of the Company at a price of $0.10 per share said options vesting equally over eight quarters and having an expiration of three years from the date of issue.

On February 2, 2017 the Company entered into a consulting agreement with Venture Legal Services, PLLC, to provide legal and strategic advisory services for the Company. In conjunction with the execution of this agreement, the Company granted Venture options to purchase up to 2,000,000 shares of its common stock at a price of $0.10 per share. The options have an expiration of three years from the date of issue and vest one option for every two dollars of revenue recognized by the Company on a quarterly basis.

Options

There were 7,400,000 options issued and outstanding as of December 31, 2016. The following table shows the stock option activity during the period ended March 31, 2017:

				Weighted
	Number			Average
	Of			Exercise
	Options			Price
Options outstanding at beginning of year			7,400,000
Changes during the period:
Granted - at market price			15,000,000		$	0.10
Exercised			-
Expired			-
Options outstanding at end of period			22,400,000		$	0.10
Options exercisable at end of period			882,181
Weighted average fair value of options granted during the period		$	1,244,000

Options issued were valued using the Black-Sholes model assuming zero dividends, a $0.10 strike price, 3-year expiration, 1.49% risk-free rate and volatility of 238%. Costs incurred in respect of stock based compensation for employees, advisors and consultants for the period ended March 31, 2017 was $59,189.

9

ZNERGY, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2017 (UNAUDITED)

Deferred compensation cost related to common stock issuances was $83,333, which amount is expected to be recognized over approximately 2 months and unrecognized compensation costs related to options was $1,554,432 which is expected to be recognized over approximately 19 months.

NOTE 6 – LITIGATION

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 within 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.

VStock Transfer Communications

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.  Management cannot at this time estimate what, if any, financial impact this matter will have on the Company.

NOTE 7 – SUBSEQUENT EVENTS

Since the end of the current Reporting Period, the Company has initiated a private placement of its securities under Rule 505 of Regulation D.  Under the terms of this offering, the Company will offer less than 7,000,000 of restricted shares to qualified investors (“Investors”).  Investors who elect to purchase these securities would receive restricted shares issued by the Company at a price of $.075 per share.  Additionally, for each such restricted share purchased by an Investor, the Investor would receive one warrant to purchase another restricted share of the Company for $.15 per share.  The term of the warrant would be one year.  One such sale and purchase under the offering occurred on May 3, 2017, when an Investor purchased  500,000 restricted shares for $37,500 and was issued warrants to purchase an additional 500,000 restricted shares for $.15 per share.  The warrants will expire on May 2, 2018.

10

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.”

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.

Subsequently, on October 26, 2015, the Company acquired Global ITS, Inc., a Wyoming corporation (“Global”), and its wholly owned subsidiary, Znergy, Inc., a Florida corporation (“Znergy”), 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, which shares were cancelled. The Company is now focused solely on the EE marketplace.  Both of these transactions are discussed in more detail below.

Recent Developments

Global ITS Transaction

Share Exchange Agreement

On October 26, 2015, the Company entered into a Share Exchange Agreement (the “Agreement”) with Global ITS, Inc., a Wyoming corporation (“Global”), and the shareholders of Global, pursuant to which we exchanged 120,000,000 of our common shares (the “Company Shares”) for 24,000,000 Global common shares held by Global’s shareholders representing 100% of Global’s outstanding shares (the “Share Exchange”). The transaction was reported in, and the Agreement was filed as an exhibit to, a Current Report filed with the SEC on October 27, 2015.

Change in Control Transaction

On February 9, 2016, the Company, Nissim Trabelsi, Shawn Telsi, the Mazzal Living Trust, the majority shareholder of the Company (the “Trust”), and B2 Opportunity Fund, LLC, a Nevada limited liability company (“B2”), entered into an Amended Master Stock Purchase Agreement (the “Master Agreement”).

Pursuant to the Master Agreement, Mr. Trabelsi and Mr. Telsi agreed to sell all of the shares of the Company’s common stock owned by them, 45,800,000 shares and 9,500,000 shares, respectively, to B2 or B2’s designees. In connection with the Master Agreement, B2 paid $315,000 to Mr. Trabelsi for his and Mr. Telsi’s shares.

11

Also in connection with the Master Agreement, the Company agreed to sell to the Trust all of its real property with a carrying value of $1,897,000, and the Trust assumed the related party loan with a carrying value of $853,521 and accounts payable and accrued expenses with a carrying value of $24,500. In exchange, 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. In connection with the execution of the Master Agreement, the Company canceled the 149,950,000 shares of common stock conveyed by the Trust.

In connection with his sale of his and Mr. Telsi’s shares, Mr. Trabelsi appointed Christopher J. Floyd to the Board of Directors of the Company and to the Board of Directors of Command Control Center Corp. (“Command Control”), a wholly owned subsidiary of the Company. Mr. Trabelsi also appointed Mr. Floyd as the CEO, CFO, and Secretary of both the Company and of Command Control. Following Mr. Trabelsi’s appointment of Mr. Floyd to the boards of directors and as an officer of the Company and Command Control, Mr. Trabelsi resigned from all positions with the Company and with Command Control, effective immediately.

Results of Operations

The Company had revenues of $143,679 and $6,080 for the three-month periods ended March 31, 2017, and March 31, 2016, respectively.  Revenues in 2017 comprise LED installation projects and associated rebates from utilities.

The Company incurred costs of revenue of $58,046 and $-0- for the three-month periods ended March 31, 2017, and March 31, 2016, respectively.  Costs of revenue in 2017 comprise primarily LED product and installation costs.

The Company had general and administrative expenses of $863,646 and $37,320 for the three-month periods ended March 31, 2017, and March 31, 2016, respectively. General and administrative expenses in 2017 include a charge of $784,189 for the issuance of stock for services in addition to payroll, audit and legal expenses.

The Company had net losses of $778,013 and $31,240 for the three-month periods ended March 31, 2017 and March 31, 2016, respectively, for the reasons explained above.

Liquidity and Capital Resources

As of March 31, 2017, the Company had total current assets of $328,377 comprising $18,494 in cash, $116,690 in accounts receivable, $2,500 in prepaid expenses and $190,694 in inventory, and total current liabilities of $632,614 comprising $281,857 in accounts payable, $126,385 in accrued expenses, $143,622 in a loan from a related party and $80,750 in advances from third parties. Use of cash for operating activities totaled $50,636 and was primarily for funding an increase in accounts receivable of $37,078 and payments on accounts payable and accrued expenses of $16,024. The primary source of funds was advances from our affiliate in the amount of $7,873 and advances from third parties of $20,750. There are no guarantees that our affiliate will continue to advance funds to the Company or that the Company will be successful in raising funds from third parties to sustain our operations.

Going Concern Discussion

For the year ending December 31, 2016, our auditors issued an explanatory note regarding our ability to continue as a going concern. This means that our auditors believe there is substantial doubt that we can continue as an on-going business for the next 12 months. Our auditor’s opinion is based on our suffering recurring losses and having a working capital deficiency. The opinion results from the fact that we have not generated sufficient material revenues. Accordingly, we must raise cash from sources other than operations. Our only other source for cash at this time is investments by and loans from others in our company.

We have two officers, Christopher Floyd, our CEO, CFO and Director, and David Baker, our Senior Vice President, who is in charge of sales and operations. Mr. Floyd is responsible for our managerial and organizational structure which will include preparation and implementation of disclosure and accounting controls under the Sarbanes Oxley Act of 2002. When these controls are implemented, Mr. Floyd, together with any other executive officers in place at that time, will be responsible for the administration of the controls.

As of March 31, 2017, we needed to raise cash to implement our business plan. The amount of funds which the Company needed to raise that management believed would allow us to implement our business strategy is approximately $150,000.

As of March 31, 2017, management believed that generating revenues in the next six to twelve months was important to support our planned ongoing operations. However, we cannot guarantee that we will generate such growth. If we do not generate sufficient cash flow to support our operations over the next 12 to 18 months, we will need to raise additional capital by issuing capital stock in exchange for cash or obtain loans in order to continue as a going concern. There are no formal or informal agreements to attain such financing. We cannot assure you that any financing can be obtained or, if obtained, that it will be on reasonable terms. Without realization of additional capital, it would be unlikely for us to continue as a going concern. No adjustments have been made to the financial statements to reflect our doubt to continue as a going concern.

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Our management does not anticipate the need to hire additional full or part-time employees of the Company or our subsidiaries over the next six months unless business development permits and requires us to, as the services provided by our two officers and our director appears sufficient at this time. We believe that our operations are currently on a small scale that is manageable by a few individuals. Further, we believe that the services provided by our officers and our director are sufficient for the operations of our subsidiary Global, and of its subsidiary Znergy. In addition, we may utilize professionals that will be considered independent contractors.

Our management does not expect to incur significant research and development costs in 2017.

We currently do not own any significant property or equipment.

Plan of Operation

The Company’s anticipated plan of operation is 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 ability to grow its incipient operations is primarily dependent upon its ability to raise additional capital, most likely through the sale of additional shares of the Company’s common stock or other securities. There can be no guarantee that the Company will be able raise additional capital on terms that are acceptable to the Company, or at all.

The realization 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.

Critical Accounting Policies

The SEC has issued Financial Reporting Release No. 60,“Cautionary Advice Regarding Disclosure About Critical Accounting Policies” (“FRR 60”), suggesting companies provide additional disclosure and commentary on their most critical accounting policies. In FRR 60, the Commission has defined the most critical accounting policies as the ones that are most important to the portrayal of a company’s financial condition and operating results, and require management to make its most difficult and subjective judgments, often as a result of the need to make estimates of matters that are inherently uncertain. Based on this definition, the Company’s most critical accounting policies include (a) use of estimates, (b) revenue recognition, (c) going concern, and (d) share based payments. The methods, estimates and judgments the Company uses in applying these most critical accounting policies have a significant impact on the results the Company reports in its financial statements.

(a) 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.

13

(b) Revenue Recognition

The Company accounts for revenue using the “completed contract method” in accordance with ASC 605-35. 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 unallocable indirect costs and corporate general and administrative costs are charged to 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. The deferred asset (accumulated contract costs) in excess of the deferred liability (billings and/or cash received) is classified as a current asset under “Costs in excess of billings on uncompleted contracts.” The deferred liability (billings and/or cash received) in excess of the deferred asset (accumulated contract costs) is classified under current liabilities as “Billings in excess of costs on uncompleted contracts.” A contract is considered complete when accepted by the customer. The Company quotes its customers the total costs of product installation and materials minus the expected rebates, if any, from a given utility.  For projects larger than $10,000, rebates must be pre-approved by the utility.  Rebate revenue is recognized when a project is completed and the rebate paperwork is submitted to and approved by the utility.

(c) 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, 2017, the Company has a working capital deficit of $304,236, insufficient cash resources to meet its planned business objectives and accumulated losses from operations of $8,729,661. The Company intends to fund operations through equity financing arrangements, which may be insufficient to fund its capital expenditures, working capital and other cash requirements through March 2018.

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. The accompanying condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

(d) Share-Based Payments

Certain employees, officers, directors, and consultants of the Company participate in incentive plans that provide for granting stock options and performance-based awards. Time based stock options generally vest in equal increments over a two -year period and expire on the third anniversary following the date of grant. Performance-based stock options vest once the applicable performance conditions are satisfied.

The Company recognizes stock-based compensation for equity awards granted to employees, officers, directors and consultants as compensation and benefits expense in the consolidated statements of operations. The fair value of stock options is estimated using a Black-Scholes valuation model on the date of grant. Stock-based compensation is recognized over the requisite service period of the individual awards, which generally equals the vesting period. For performance-based stock options, compensation is recognized once the applicable performance condition is satisfied.

The Company recognizes stock-based compensation for equity awards granted as selling, general and administrative expense in the consolidated statements of operations.

The fair value of restricted stock awards is equal to the closing price of the Company’s stock on the date of grant multiplied by the number of shares awarded. Stock-based compensation is recognized over the requisite service period of the individual awards, which generally equals the vesting period.

JOBS Act

On April 5, 2012, the JOBS Act was signed into law. The JOBS Act contains provisions that, among other things, reduce certain reporting requirements for qualifying public companies. As an “emerging growth company,” we have the option to delay adoption of new or revised accounting standards until those standards would otherwise apply to private companies, until the earlier of the date that (i) we are no longer an emerging growth company or (ii) we affirmatively and irrevocably opt out of the extended transition period for complying with such new or revised accounting standards. We have elected to opt out of this extended transition period. As noted, this election is irrevocable.

14

Our significant accounting policies, as described in our financial statements in the Summary of Significant Accounting Policies included in our Form 10-K filing of December 31, 2016, be read in conjunction with this Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Recently Issued Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update No. 2014-09, Revenue From Contracts With Customers, or ASU 2014-09. Pursuant to this update, an entity should recognize revenue to depict 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 amendments in this update are currently effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period, and are to be applied retrospectively, or on a modified retrospective basis. Early application is not permitted. In July 2015, the FASB approved a one-year deferral of the effective date for annual reporting periods beginning after December 15, 2017 with early adoption permitted for annual periods beginning after December 15, 2016. We are currently evaluating the impact of adopting ASU 2014-09 on our consolidated financial statements.

In August 2014, FASB issued ASU 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, or ASU 2014-15. ASU 2014-15 explicitly requires a company’s management to assess an entity’s ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. The new standard became effective in the first annual period ending after December 15, 2016. Management has evaluated the potential impact of the adoption of this standard and believes its adoption has no material impact on our consolidated statements of financial position, results of operations or cash flows.

In July 2015, the FASB issued ASU No. 2015-11, (“ASU 2015-11”), Inventory (Topic 330): Simplifying the Measurement of Inventory. ASU 2015-11 requires an entity to measure in scope inventory at the lower of cost and net realizable value. The amendment does not apply to inventory that is measured using the last-in, first-out or the retail inventory method. For public entities, ASU 2015-11 is effective for fiscal years beginning after December 15, 2016, and interim periods within those fiscal years, and is to be applied prospectively. We do not expect the adoption of this standard will have a material effect on our consolidated financial statements.

On February 24, 2016, the FASB issued ASU No. 2016-02, Leases, requiring lessees to recognize a right-of-use asset and a lease liability on the balance sheet for all leases with the exception of short-term leases. For lessees, leases will continue to be classified as either operating or finance leases in the income statement. Lessor accounting is similar to the current model but updated to align with certain changes to the lessee model. Lessors will continue to classify leases as operating, direct financing or sales-type leases. The effective date of the new standard for public companies is for fiscal years beginning after December 15, 2018 and interim periods within those fiscal years. Early adoption is permitted. The new standard must be adopted using a modified retrospective transition and requires application of the new guidance at the beginning of the earliest comparative period presented. We are currently evaluating the effect that the updated standard will have on our consolidated financial statements and related disclosures.

On March 30, 2016, the FASB issued ASU No. 2016-09, Improvements to Employee Share-Based Payment Accounting, which simplifies various aspects related to the accounting and presentation of share-based payments. The amendments require entities to record all tax effects related to share-based payments at settlement or expiration through the income statement and the windfall tax benefit to be recorded when it arises, subject to normal valuation allowance considerations. All tax-related cash flows resulting from share-based payments are required to be reported as operating activities in the statement of cash flows. The updates relating to the income tax effects of the share-based payments including the cash flow presentation must be adopted either prospectively or retrospectively. Further, the amendments allow the entities to make an accounting policy election to either estimate forfeitures or recognize forfeitures as they occur. If an election is made, the change to recognize forfeitures as they occur must be adopted using a modified retrospective approach with a cumulative effect adjustment recorded to opening retained earnings. The effective date of the new standard for public companies is for fiscal years beginning after December 15, 2016 and interim periods within those fiscal years. Early adoption is permitted. Adoption of this standard did not have any effect on the Company’s financial statements.

The Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

Off-Balance Sheet Arrangements

None.

15

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 Chief Financial Officer, who is the same person, 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, 2017: (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.

Changes in Internal Control over Financial Reporting

There was no change in the Company’s internal control over financial reporting that occurred during the Company’s most recently completed fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

16

PART II.                 OTHER INFORMATION

Item 1. Legal Proceedings

Other than described below, we know of no pending legal proceedings to which we are a party which are material or potentially material, either individually or in the aggregate. We are from time to time, during the normal course of our business operations, subject to various litigation claims and legal disputes. We do not believe that the ultimate disposition of any of these matters will have a material adverse effect on our consolidated financial position, results of operations or liquidity.

On September 26, 2016, the Company 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, the Company 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 the Company 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 the Company 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, the Company has demanded the return of all such profits to Registrant plus the statutory payment of attorneys’ fees.

On January 26, 2017, the Company received an email from its transfer agent at that time, 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. Management cannot at this time estimate what, if any, financial impact this matter will have on the Company.

Item 5. Other Information.

Amendment of Articles of Incorporation; Name Change; Status

On May 31, 2016, the Company filed a definitive information statement on Schedule 14C to provide information to the Company’s stockholders relating to an action taken by the holders of a majority of the outstanding shares of common stock to amend the Company’s articles of incorporation to change the name of the Company from Mazzal Holding Company to Znergy, Inc. The Board of Directors of the Company approved the amendment and name change and recommended the amendment to the shareholders of the Company. On May 13, 2016, the holders of 94,498,335 shares of the Company’s common stock, constituting approximately 52.48% of the outstanding shares, approved the amendment and the name change.

On July 15, 2016, the Company filed its Amended and Restated Articles of Incorporation with the State of Nevada to effectuate the name change. As of the date of this Report, the Company had filed a notice of corporate action with FINRA, and was working with FINRA to complete the approval process to effectuate the name change in the trading market.

17

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
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 on Form 8-K, filed with the Commission on October 4, 2016)
31	Certification of the Chief Executive Officer/Chief Financial Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a).
32	Certification of CEO and CFO 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*

18

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/ Christopher J. Floyd

Christopher J. Floyd

President, CEO, CFO, Director

(Principal Executive Officer, Principal Financial Officer)

Date: May 10, 2017

19

EX-31

Exhibit 31

Certification of the Chief Executive Officer/Chief

Financial Officer pursuant to

Rule 13a-14(a) or Rule 15d-14(a)

I, Christopher J. Floyd, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Znergy, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of the annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: May 10, 2017	By:	/s/ Christopher J. Floyd
		Christopher J. Floyd
		Chief Executive Officer, Chief Financial Officer

EX-32

Exhibit 32

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Znergy, Inc. (the “Company”) for the three and nine month periods ending March 31, 2017, as filed with the Securities and Exchange Commission as of and on the date hereof (the “Report”), Christopher Floyd, Chief Executive Officer and Chief Financial Officer of the Company, hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge:

(1) The report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: May 10, 2017	By:	/s/ Christopher J. Floyd
		Christopher J. Floyd
		Chief Executive Officer, Chief Financial Officer

This certification accompanies each Report pursuant to § 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the Company for purposes of §18 of the Securities Exchange Act of 1934, as amended.

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Document And Entity Information - shares	3 Months Ended
	Mar. 31, 2017	May 10, 2017
Document and Entity Information [Abstract]
Entity Registrant Name	Znergy, Inc.
Document Type	10-Q
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		200,150,000
Amendment Flag	false
Entity Central Index Key	0001568875
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Smaller Reporting Company
Entity Well-known Seasoned Issuer	No
Document Period End Date	Mar. 31, 2017
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	Q1

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)	Mar. 31, 2017	Dec. 31, 2016
CURRENT ASSETS
Cash	$ 18,494	$ 40,507
Accounts receivable	116,690	79,612
Prepaid expenses	2,500	3,750
Inventory	190,694	192,105
Total current assets	328,378	315,974
Furniture & equipment, net	2,333	2,567
Intangible assets, net	1,845	1,845
TOTAL ASSETS	332,556	320,386
CURRENT LIABILITIES
Accounts payable	281,857	284,930
Accrued expenses	126,385	139,336
Customer deposits	0	6,605
Advances from third parties	80,750	60,000
Loan from related party	143,622	135,749
Total current liabilities	632,614	626,620
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ DEFICIT
Preferred stock, $0.0001 par value, 100,000,000 authorized shares; no shares issued and outstanding	0	0
Common stock, $0.0001 par value; 500,000,000 shares authorized; 200,150,000 and 193,150,000 shares issued and outstanding at March 31, 2017 and December 31, 2016	20,015	19,315
Additional paid-in-capital	8,409,588	7,626,099
Accumulated deficit	(8,729,661)	(7,951,648)
Total stockholders’ deficit	(300,058)	(306,234)
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT	$ 332,556	$ 320,386

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (Parentheticals) - $ / shares	Mar. 31, 2017	Dec. 31, 2016
Preferred stock par value (in Dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	100,000,000	100,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in Dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized	500,000,000	500,000,000
Common stock, shares issued	200,150,000	193,150,000
Common stock, shares outstanding	200,150,000	193,150,000

XML

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Revenue	$ 143,679	$ 6,080
Cost of revenue	58,046	0
Gross profit	85,633	6,080
Selling, general and administrative expenses	863,646	37,320
Loss from operations	(778,013)	(31,240)
Provision for income taxes	0	0
Net loss	$ (778,013)	$ (31,240)
Net loss per common share - basic and diluted (in Dollars per share)	$ 0.00	$ 0.00
Weighted average number of shares outstanding - basic and diluted (in Shares)	196,015,000	245,245,652

XML

CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT) (Unaudited) - 3 months ended Mar. 31, 2017 - USD ($)	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Total
Balance at Dec. 31, 2016	$ 19,315	$ 7,626,099	$ (7,951,648)	$ (306,234)
Balance (in Shares) at Dec. 31, 2016	193,150,000			193,150,000
Common stock issued for services	$ 700	724,300		$ 725,000
Common stock issued for services (in Shares)	7,000,000
Stock options		59,189		59,189
Net loss			(778,013)	(778,013)
Balance at Mar. 31, 2017	$ 20,015	$ 8,409,588	$ (8,729,661)	$ (300,058)
Balance (in Shares) at Mar. 31, 2017	200,150,000			200,150,000

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
CASH FLOWS USED IN OPERATING ACTIVITIES:
Net loss	$ (778,013)	$ (31,240)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	234	1,250
Common stock and options issued for services	784,189	0
Contributed services	0	10,640
Accounts receivable	(37,078)	(3,280)
Prepaid expenses	1,250	0
Inventory	1,411	0
Accounts payable & accrued expenses	(16,024)	1,644
Customer deposits	(6,605)	0
Net cash used in operating activities	(50,636)	(20,986)
CASH FLOWS USED IN INVESTING ACTIVITIES:
Cash transferred to prior shareholder	0	(1,213)
Net cash used in investing activities	0	(1,213)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from advances from third parties	20,750	0
Proceeds from loan from related party	7,873	26,300
Net cash provided by financing activities	28,623	26,300
INCREASE (DECREASE) IN CASH	(22,013)	4,101
CASH, BEGINNING OF PERIOD	40,507	1,279
CASH, END OF PERIOD	18,494	5,380
Non-cash investing and financing activities:
Transfer of assets and liabilities to related party for return of common shares	$ 0	$ 1,018,679

XML

NOTE 1 - NATURE OF BUSINESS AND BASIS OF PRESENTATION

3 Months Ended

Mar. 31, 2017

Disclosure Text Block [Abstract]

Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]

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”), incorporated on January 23, 2013. The original business plan of the Company was the construction and management of multi-family home developments and the subsequent sale thereof.

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.  The Company is now focused solely on the EE marketplace with an emphasis on LED retrofitting and relamping.

Basis of Presentation

The accompanying interim condensed consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and the instructions to Form 10-Q and do not include all of the information and footnotes required by GAAP for complete financial statements. All intercompany transactions have been eliminated in consolidation.

Certain information and footnote disclosures normally included in the Company’s annual audited consolidated financial statements and accompanying notes have been condensed or omitted in these interim condensed consolidated financial statements. Accordingly, the unaudited condensed consolidated financial statements included herein should be read in conjunction with the audited condensed consolidated financial statements for the year ended December 31, 2016, as filed with the Securities and Exchange Commission (“SEC”) on Form 10-K.

The results of operations presented in this quarterly report are not necessarily indicative of the results of operations that may be expected for any future periods. In the opinion of management, these unaudited condensed consolidated financial statements include all adjustments and accruals, consisting only of normal recurring adjustments that are necessary for a fair presentation of the results of all interim periods reported herein.

Consolidation

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

XML

NOTE 2 - GOING CONCERN

3 Months Ended

Mar. 31, 2017

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Substantial Doubt about Going Concern [Text Block]

NOTE 2 – 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, 2017, the Company has a working capital deficit of $304,236, insufficient cash resources to meet its planned business objectives and accumulated losses from operations of $8,729,661. The Company intends to fund operations through equity financing arrangements, which may be insufficient to fund its capital expenditures, working capital and other cash requirements through March 2018.

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. The accompanying condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

XML

NOTE 3 - INTANGIBLE ASSETS

3 Months Ended

Mar. 31, 2017

Disclosure Text Block [Abstract]

Intangible Assets Disclosure [Text Block]

NOTE 3 – INTANGIBLE ASSETS

The Company was granted a federally registered trademark for “ZNERGY”. The cost of applying for and prosecuting this trademark was $1,845 which cost was accounted for as a non-amortizing intangible asset.

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NOTE 4 - LOANS FROM RELATED PARTY

3 Months Ended

Mar. 31, 2017

Disclosure Text Block [Abstract]

Short-term Debt [Text Block]

NOTE 4 – LOANS FROM RELATED PARTY

	March 31, 2017		December 31, 2016
Loans from related party	$	143,622	$	135,749

The above loans at March 31, 2017 are from B2 Opportunity Fund, LLC, a major shareholder of the Company, and are unsecured, bear no interest and are repayable on demand.

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NOTE 5 - STOCKHOLDERS' EQUITY

3 Months Ended

Mar. 31, 2017

Stockholders' Equity Note [Abstract]

Stockholders' Equity Note Disclosure [Text Block]

NOTE 5 – STOCKHOLDERS’ EQUITY

Common Stock

On January 25, 2017 the Company appointed Richard Mikles as Chairman of the board of directors and issued to Mr. Mikles 3,000,000 shares of its common stock vested immediately, and 4,000,000 options to purchase shares of common stock of the Company at a price of $0.10 per share said options vesting equally over eight quarters and having an expiration of three years from the date of issue. Concomitantly, the Company entered into a consulting agreement with Mr. Mikles to provide marketing, strategic, and organizational services to the Company.  Upon execution of this consulting agreement the Company issued 2,000,000 shares of common stock, vested immediately, and 5,000,000 options to purchase shares of common stock of the Company at a price of $0.10 per share said options to vest quarterly in the amount of one option for every two dollars of revenue recognized by the Company.

On January 27, 2017 the Company appointed Kevin Harrington to its Board of Directors and issued 2,000,000 shares of its common stock, vested immediately, and 4,000,000 options to purchase shares of common stock of the Company at a price of $0.10 per share said options vesting equally over eight quarters and having an expiration of three years from the date of issue.

On February 2, 2017 the Company entered into a consulting agreement with Venture Legal Services, PLLC, to provide legal and strategic advisory services for the Company. In conjunction with the execution of this agreement, the Company granted Venture options to purchase up to 2,000,000 shares of its common stock at a price of $0.10 per share. The options have an expiration of three years from the date of issue and vest one option for every two dollars of revenue recognized by the Company on a quarterly basis.

Options

There were 7,400,000 options issued and outstanding as of December 31, 2016. The following table shows the stock option activity during the period ended March 31, 2017:

				Weighted
	Number			Average
	Of			Exercise
	Options			Price
Options outstanding at beginning of year			7,400,000
Changes during the period:
Granted - at market price			15,000,000		$	0.10
Exercised			-
Expired			-
Options outstanding at end of period			22,400,000		$	0.10
Options exercisable at end of period			882,181
Weighted average fair value of options granted during the period		$	1,244,000

Options issued were valued using the Black-Sholes model assuming zero dividends, a $0.10 strike price, 3-year expiration, 1.49% risk-free rate and volatility of 238%. Costs incurred in respect of stock based compensation for employees, advisors and consultants for the period ended March 31, 2017 was $59,189.

Deferred compensation cost related to common stock issuances was $83,333, which amount is expected to be recognized over approximately 2 months and unrecognized compensation costs related to options was $1,554,432 which is expected to be recognized over approximately 19 months.

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NOTE 6 - LITIGATION

3 Months Ended

Mar. 31, 2017

Disclosure Text Block Supplement [Abstract]

Legal Matters and Contingencies [Text Block]

NOTE 6 – LITIGATION

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 within 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.

VStock Transfer Communications

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.  Management cannot at this time estimate what, if any, financial impact this matter will have on the Company.

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NOTE 7 - SUBSEQUENT EVENTS

3 Months Ended

Mar. 31, 2017

Accounting Policies [Abstract]

Significant Accounting Policies [Text Block]

NOTE 7 – SUBSEQUENT EVENTS

Since the end of the current Reporting Period, the Company has initiated a private placement of its securities under Rule 505 of Regulation D.  Under the terms of this offering, the Company will offer less than 7,000,000 of restricted shares to qualified investors (“Investors”).  Investors who elect to purchase these securities would receive restricted shares issued by the Company at a price of $.075 per share.  Additionally, for each such restricted share purchased by an Investor, the Investor would receive one warrant to purchase another restricted share of the Company for $.15 per share.  The term of the warrant would be one year.  One such sale and purchase under the offering occurred on May 3, 2017, when an Investor purchased  500,000 restricted shares for $37,500 and was issued warrants to purchase an additional 500,000 restricted shares for $.15 per share.  The warrants will expire on May 2, 2018.

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NOTE 4 - LOANS FROM RELATED PARTY (Tables)

3 Months Ended

Mar. 31, 2017

Disclosure Text Block [Abstract]

Schedule of Short-term Debt [Table Text Block]

	March 31, 2017		December 31, 2016
Loans from related party	$	143,622	$	135,749

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NOTE 5 - STOCKHOLDERS' EQUITY (Tables)

3 Months Ended

Mar. 31, 2017

Stockholders' Equity Note [Abstract]

Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding and Exercisable [Table Text Block]

There were 7,400,000 options issued and outstanding as of December 31, 2016. The following table shows the stock option activity during the period ended March 31, 2017:

				Weighted
	Number			Average
	Of			Exercise
	Options			Price
Options outstanding at beginning of year			7,400,000
Changes during the period:
Granted - at market price			15,000,000		$	0.10
Exercised			-
Expired			-
Options outstanding at end of period			22,400,000		$	0.10
Options exercisable at end of period			882,181
Weighted average fair value of options granted during the period		$	1,244,000

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NOTE 1 - NATURE OF BUSINESS AND BASIS OF PRESENTATION (Details) - shares	Feb. 09, 2016	Mar. 13, 2013
Disclosure Text Block [Abstract]
Stock Repurchased and Retired During Period, Shares	149,950,000
Stock Issued During Period, Shares, Acquisitions		150,000,000

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NOTE 2 - GOING CONCERN (Details) - USD ($)	Mar. 31, 2017	Dec. 31, 2016
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Working Capital (Deficit)	$ (304,236)
Retained Earnings (Accumulated Deficit)	$ (8,729,661)	$ (7,951,648)

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NOTE 3 - INTANGIBLE ASSETS (Details)	3 Months Ended
	Mar. 31, 2017 USD ($)
Disclosure Text Block [Abstract]
Finite-lived Intangible Assets Acquired	$ 1,845

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NOTE 4 - LOANS FROM RELATED PARTY (Details) - Schedule of Related Party Loans - USD ($)	Mar. 31, 2017	Dec. 31, 2016
Schedule of Related Party Loans [Abstract]
Loans from related party	$ 143,622	$ 135,749

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NOTE 5 - STOCKHOLDERS' EQUITY (Details) - USD ($)				3 Months Ended
	Feb. 02, 2017	Jan. 27, 2017	Jan. 25, 2017	Mar. 31, 2017	Dec. 31, 2016
NOTE 5 - STOCKHOLDERS' EQUITY (Details) [Line Items]
Stock Issued During Period, Shares, Share-based Compensation, Gross		2,000,000	2,000,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross	2,000,000	4,000,000	5,000,000	15,000,000
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price (in Dollars per share)	$ 0.10	$ 0.10	$ 0.10
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	3 years	24 months
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period		3 years
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights	vest one option for every two dollars of revenue recognized by the Company on a quarterly basis		vest quarterly in the amount of one option for every two dollars of revenue recognized by the Company
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number				22,400,000	7,400,000
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Dividend Rate				0.00%
Share Price (in Dollars per share)				$ 0.10
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term				3 years
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate				1.49%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate				238.00%
Share-based Compensation (in Dollars)				$ 59,189
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Stock Options (in Dollars)				$ 83,333
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition				19 months
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized (in Dollars)				$ 1,554,432
Employee Stock Option [Member]
NOTE 5 - STOCKHOLDERS' EQUITY (Details) [Line Items]
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition				2 months
Board of Directors Chairman [Member]
NOTE 5 - STOCKHOLDERS' EQUITY (Details) [Line Items]
Stock Issued During Period, Shares, Share-based Compensation, Gross			3,000,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross			4,000,000
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price (in Dollars per share)			$ 0.10
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period			24 months
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period			3 years

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NOTE 5 - STOCKHOLDERS' EQUITY (Details) - Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding and Exercisable - USD ($)				3 Months Ended
	Feb. 02, 2017	Jan. 27, 2017	Jan. 25, 2017	Mar. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding and Exercisable [Abstract]
Options outstanding at beginning of year				7,400,000
Changes during the period:
Granted - at market price	2,000,000	4,000,000	5,000,000	15,000,000
Granted - at market price (in Dollars per share)				$ 0.10
Exercised				0
Expired				0
Options outstanding at end of period				22,400,000
Options outstanding at end of period (in Dollars per share)				$ 0.10
Options exercisable at end of period				882,181
Weighted average fair value of options granted during the period (in Dollars)				$ 1,244,000

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NOTE 6 - LITIGATION (Details)	Sep. 26, 2016 USD ($)
Disclosure Text Block Supplement [Abstract]
Loss Contingency, Damages Sought, Value	$ 1,695,689

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NOTE 7 - SUBSEQUENT EVENTS (Details) - Subsequent Event [Member] - USD ($)		1 Months Ended
	May 03, 2017	May 10, 2017
NOTE 7 - SUBSEQUENT EVENTS (Details) [Line Items]
Private Placement, Number of Shares		7,000,000
Shares Issued, Price Per Share		$ 0.075
Warrant, Description		one warrant to purchase another restricted share of the Company for $.15 per share
Class of Warrant or Right, Exercise Price of Warrants or Rights	$ 0.15	$ 0.15
Warrant, Term		1 year
Stock Issued During Period, Shares, Restricted Stock Award, Gross	500,000
Stock Issued During Period, Value, Restricted Stock Award, Gross	$ 37,500
Class of Warrant or Rights, Granted	500,000
Warrants, Expiration Date	May 02, 2018