10-Q 1 pwvi_3q20.htm 10-Q

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington D.C. 20549

Form 10-Q

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

For the Quarterly Period ended September 30, 2020

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

Commission file number: 000-27866

POWERVERDE, INC.

(Exact name of Registrant as specified in its charter)

Delaware		88-0271109
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

9300 S. Dadeland Blvd, Ste 600

Miami, FL 33156

(Address of principal executive offices)

(305) 670-3370

(Registrant’s telephone number including area code)

(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 past 12 months (or for 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, or a smaller reporting company.

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

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

State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date: As of November 13, 2020, the issuer had 27,747,698 shares of common stock outstanding.

Index to Form 10-Q

		Page
PART I	FINANCIAL INFORMATION	1

Item 1.	Condensed Consolidated Financial Statements (Unaudited)	1
	Condensed Consolidated Balance Sheets at September 30, 2020 and December 31, 2019 (Unaudited)	1
	Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2020 and 2019 (Unaudited)	2
	Condensed Consolidated Statements of Changes in Stockholders’ Deficit for the three and nine months ended September 30, 2020 and 2019 (Unaudited)	3
	Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2020 and 2019 (Unaudited)	5
	Notes to Unaudited Condensed Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	14
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	16
Item 4.	Controls and Procedures	17

PART II	OTHER INFORMATION	18

Item 1.	Legal Proceedings	18
Item 1A.	Risk Factors	18
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	18
Item 3.	Defaults upon Senior Securities	18
Item 4.	Mine Safety Disclosures	18
Item 5.	Other Information	19
Item 6.	Exhibits	20

SIGNATURES		21

Cautionary Note Regarding Forward-Looking Information

This Form 10-Q contains certain statements related to future results of the Company that are considered “forward-looking statements” within the meaning of the Private Litigation Reform Act of 1995. Actual results may differ materially from those expressed or implied as a result of certain risks and uncertainties, including, but not limited to, changes in political and economic conditions; interest rate fluctuation; competitive pricing pressures within the Company’s market; equity and fixed income market fluctuation; technological changes; changes in law; changes in fiscal, monetary, regulatory, and tax policies; monetary fluctuations as well as other risks and uncertainties detailed elsewhere in this Form 10-Q or from time-to-time in the filings of the Company with the Securities and Exchange Commission. Such forward-looking statements speak only as of the date on which such statements are made, and the Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events.

PART I FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements

PowerVerde, Inc. and Subsidiary
Condensed Consolidated Balance Sheets
September 30, 2020 and December 31, 2019 (Unaudited)

	2020			2019
Assets
Current Assets:
Cash	$	138,991		$	20,033
Accounts receivable		19,000			6,000
Prepaid expenses		14,224			11,460
Total Current Assets	$	172,215		$	37,493

Liabilities and Stockholders’ Deficit
Current Liabilities
Accounts payable and accrued expenses	$	186,418		$	101,131
Total Current Liabilities		186,418			101,131

Long Term Liabilities
Convertible notes payable to related parties, net of debt discount and issuance costs		228,244			211,900
Convertible notes payable, net of debt discount and issuance costs		245,511			94,354
Total Long Term Liabilities		473,755			306,254

Total Liabilities		660,173			407,385

Stockholders’ Deficit
Preferred Stock:
50,000,000 preferred shares authorized, 0 preferred shares issued at September 30, 2020 and December 31, 2019		—			—
Common stock:
200,000,000 common shares authorized, par value $0.0001 per share, 40,300,106 common shares issued; 27,747,698 and 31,750,106 common shares outstanding at September 30, 2020 and December 31, 2019, respectively		3,981			3,981
Additional paid-in capital		13,165,280			12,689,980
Treasury stock, 12,577,408 and 8,550,000 shares at cost, respectively		(791,139	)		(491,139	)
Accumulated deficit		(12,866,080	)		(12,572,714	)
Total Stockholders’ Deficit		(487,958	)		(369,892	)

Total Liabilities and Stockholders’ Deficit	$	172,215		$	37,493

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

PowerVerde, Inc. and Subsidiary
Condensed Consolidated Statements of Operations
For the three and nine months ended September 30, 2020 and 2019
(Unaudited)

	Three months ended September 30,						Nine months ended September 30,
	2020			2019			2020			2019

Revenue	$	6,000		$	3,000		$	25,000		$	9,000

Operating Expenses
Research and development		22,500			114,620			79,939			184,301
General and administrative		82,927			49,938			190,154			159,326
Total Operating Expenses		105,427			164,558			270,093			343,627

Loss from Operations		(99,427	)		(161,558	)		(245,093	)		(334,627	)

Other Income (Expenses)
Loss on impairment		—			—			—			(69,178	)
Interest expense		(23,124	)		(9,265	)		(48,273	)		(23,009	)
Total Other Expense		(23,124	)		(9,265	)		(48,273	)		(92,187	)

Loss before Income Taxes		(23,124	)		(9,265	)		(293,366	)		(92,187	)
Provision for Income Taxes		—			—			—			—

Net Loss	$	(122,551	)	$	(170,823	)	$	(293,366	)	$	(426,814	)

Net Loss per Share - Basic and Diluted	$	(0.00	)	$	(0.00	)	$	(0.01	)	$	(0.01	)

Weighted Average Common Shares Outstanding - Basic and Diluted		31,706,602			31,750,106			31,735,499			31,750,106

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

PowerVerde, Inc and Subsidiary

Condensed Consolidated Changes in Stockholders’ Deficit

For the three and nine months ended September 30, 2020 (Unaudited)

For the nine months ended September 30, 2020

	Common Shares			Common Stock		Additional paid-in capital		Treasury Stock			Accumulated Deficit			Total Stockholders’ Deficit
Balances at December 31, 2019		31,750,106		$	3,981	$	12,689,980	$	(491,139	)	$	(12,572,714	)	$	(369,892	)
Repurchase of Common Stock Shares from related party		(4,027,408	)		—		—		(300,000	)		—			(300,000	)
Issuance of Common Stock		25,000			—		3,000		—			—			3,000
Beneficial Conversion Feature on Convertible Notes Payable		—			—		472,300		—			—			472,300
Net loss		—			—		—		—			(293,366	)		(293,366	)
Balances at September 30, 2020		27,747,698		$	3,981	$	13,165,280	$	(791,139	)	$	(12,866,080	)	$	(487,958	)

For the three months ended September 30, 2020

	Common Shares			Common Stock		Additional paid-in capital		Treasury Stock			Accumulated Deficit			Total Stockholders’ Deficit
Balances at June 30, 2020		31,750,106		$	3,981	$	12,689,980	$	(491,139	)	$	(12,743,529	)	$	(540,707	)
Repurchase of Common Stock Shares from related party		(4,027,408	)		—		—		(300,000	)		—			(300,000	)
Issuance of Common Stock		25,000			—		3,000		—			—			3,000
Beneficial Conversion Feature on Convertible Notes Payable		—			—		472,300		—			—			472,300
Net loss		—			—		—		—			(122,551	)		(122,551	)
Balances at September 30, 2020		27,747,698		$	3,981	$	13,165,280	$	(791,139	)	$	(12,866,080	)	$	(487.958	)

PowerVerde, Inc and Subsidiary

Condensed Consolidated Changes in Stockholders’ Deficit

For the three and nine months ended September 30, 2019

(Unaudited)

For the nine months ended September 30, 2019

	Common Shares		Common Stock		Additional paid-in capital		Treasury Stock			Accumulated Deficit			Total Stockholders’ Deficit
Balances at December 31, 2018		31,750,106	$	3,981	$	12,609,980	$	(491,139	)	$	(12,057,798	)	$	65,024
Stock based compensation		—		—		80,000		—			—			80,000
Net loss		—		—		—		—			(426,814	)		(426,814	)
Balances at September 30, 2019		31,750,106	$	3,981	$	12,689,980	$	(491,139	)	$	(12,484,612	)	$	(281,790	)

For the three months ended September 30, 2019

	Common Shares		Common Stock		Additional paid-in capital		Treasury Stock			Accumulated Deficit			Total Stockholders’ Deficit
Balances at June 30, 2019		31,750,106	$	3,981	$	12,609,980	$	(491,139	)	$	(12,313,789	)	$	(190,967	)
Stock based compensation		—		—		80,000		—			—			80,000
Net loss		—		—		—		—			(170,823	)		(170,823	)
Balances at September 30, 2019		31,750,106	$	3,981	$	12,689,980	$	(491,139	)	$	(12,484,612	)	$	(281,790	)

PowerVerde, Inc. and Subsidiary
Condensed Consolidated Statements of Cash Flows
For the nine months ended September 30, 2020 and 2019
(Unaudited)

	2020			2019
Cash Flows From Operating Activities
Net loss	$	(293,366	)	$	(426,814	)
Adjustments to reconcile net loss to net cash to net cash used by operating activities:
Impairment of intangible assets		—			69,178
Depreciation and amortization		—			5,633
Amortization of debt issuance costs		10,060			5,097
Amortization of debt discount		6,366			—
Stock based compensation		—			80,000
Changes in operating assets and liabilities:
Accounts receivable and prepaid expenses		(15,764	)		(7,393
Accounts payable and accrued expenses		85,287			21,921	)

Cash Used In Operating Activities		(207,417	)		(252,378	)

Cash Flows from Financing Activities
Proceeds from convertible notes payable, related parties		50,000			200,000
Proceeds from convertible notes payable		586,000			100,000
Payments for debt issuance costs		(12,625	)		(24,000	)
Proceeds from warrant exercise		3,000			—
Payment for stock repurchase from related party		(300,000	)		—

Cash provided by Financing Activities		326,375			276,000

Net Change in Cash		118,958			23,622

Cash at Beginning of Period		20,033			8,482

Cash at End of Period	$	138,991		$	32,104

Supplemental Disclosure of Cash Flow Information
Cash paid during the period for interest	$	—		$	10,747
Cash paid during the period for income taxes	$	—		$	—
Noncash Financing Activities
Beneficial conversion feature on convertible notes payable	$	472,300		$	—

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

PowerVerde, Inc. and Subsidiary

Notes to Unaudited Condensed Consolidated Financial Statements

September 30, 2020

Note 1 – Nature of Business and Presentation of Financial Statements

Nature of Business

The Company is devoting substantially all of its present efforts to establish a new business involving the development and commercialization of clean energy electric power generation systems, and none of its planned principal operations have commenced. No material revenues from this planned principal operation have been generated since inception. Revenues to date have been from assembly services provided to one customer.

Presentation of Financial Statements

The accompanying unaudited condensed consolidated financial statements prepared in accordance with instructions for Form 10-Q, include all adjustments (consisting only of normal recurring accruals) which are necessary for a fair presentation of the results for the periods presented. Certain information and footnote disclosures normally included in the consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. It is suggested that these condensed consolidated financial statements be read in conjunction with the Annual Report of PowerVerde, Inc. (“PowerVerde,” “we,” “us,” “our,” or the “Company”) as of and for the year ended December 31, 2019 filed with the Securities and Exchange Commission (“SEC”) on April 14, 2020. The results of operations for the three and nine months ended September 30, 2020, are not necessarily indicative of the results to be expected for the full year or for future periods. The condensed consolidated financial statements include the accounts of PowerVerde, Inc., formerly known as Vyrex Corporation (the “Company”), and PowerVerde Systems, Inc., formerly known as PowerVerde, Inc., its wholly-owned subsidiary. Intercompany balances and transactions have been eliminated in consolidation.

Note 2 – Going Concern

The financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As of September 30, 2020, we had a working capital deficit of $14,203 compared to a working capital deficit of $63,638 at December 31, 2019. This decrease in the working capital deficit is due primarily to cash raised through related and nonrelated party convertible notes payable financing. As of September 30, 2020, the Company has an accumulated deficit of $12,866,080. For the nine months ended September 30, 2020, the Company had a net loss of $293,366 and $207,417 of net cash used in operations for the period.

The Company has historically relied upon unrelated and related party debt and equity financing to fund its cash flow shortages and will require either additional debt or equity financing to sustain its operations. The Company’s revenues through 2018 were derived mainly from royalties under its Biotech licensing agreement, which expired in March 2018 and the Company’s revenue since this expiration have been minimal. Those factors create substantial doubt about the Company’s ability to continue as a going concern.

The Company continues to seek funding from private debt and equity investors, as it needs to promptly raise substantial additional capital in order to finance its plan of operations. There can be no assurance that the Company will be able to promptly raise the necessary funds on commercially acceptable terms, if at all. If the Company does not raise the necessary funds, it may be forced to cease operations. These financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Note 3 – Summary of Significant Accounting Policies

Cash Equivalents

The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. The Company held no cash equivalents as of September 30, 2020 and December 31, 2019.

Accounts Receivable and Concentration

Accounts receivable consist of balances due from assembly services. The Company monitors accounts receivable and provides allowances when considered necessary. At September 30, 2020 and December 31, 2019, accounts receivable were considered to be fully collectible. Accordingly, no allowance for doubtful accounts was provided. At September 30, 2020 and December 31, 2019, accounts receivable were due from one customer.

Revenue Recognition and Concentration

The Company follows the revenue standards of Financial Accounting Standards Board Update No. 2014-09: “Revenue from Contracts with Customers (Topic 606).” The core principle of this Topic is that an entity recognizes 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. Revenue is recognized in accordance with that core principle by applying the following five steps: 1) identify the contracts with a customer; 2) identify the performance obligations in the contract; 3) determine the transaction price; 4) allocate the transaction price to the performance obligations; and 5) recognize revenue when (or as) we satisfy a performance obligation.

Royalties are recognized as earned in the period the sales to which the royalties relate occur. The Company has not yet generated any royalty revenues. Manufacturing assembly services are recognized as revenue when the assembled product is delivered to the customer and the Company has completed its performance obligations. Revenues for the three and nine months ended September 30, 2020 and 2019 were generated from manufacturing assembly services and are from one customer.

Impairment of Long-Lived Assets

Impairment losses are recorded on long-lived assets (property, equipment and intellectual property) used in operations when impairment indicators are present and the undiscounted expected cash flows estimated to be generated by those assets are less than the carrying value of such assets. As of June 2019, the Company recognized an impairment loss of $69,178. The intellectual property was fully amortized as of December 31, 2019.

The Company reviews intangible assets with finite lives for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company uses an estimate of the undiscounted cash flows over the remaining life of its long-lived assets, or related group of assets where applicable, in measuring whether the assets to be held and used will be realizable. In the event of impairment, the Company would discount the future cash flows using its then estimated incremental borrowing rate to estimate the amount of the impairment.

Stock-based Compensation

The Company has accounted for stock-based compensation under the provisions of Accounting Standards Codification (ASC) Topic 718 – “Stock Compensation” which requires the use of the fair-value based method to determine compensation for all arrangements under which employees and others receive shares of stock or equity instruments (stock options and common stock purchase warrants). The fair value of each stock option award is estimated on the date of grant using the Black-Scholes valuation model that uses assumptions for expected volatility, expected dividends, expected term, and the risk-free interest rate. Expected volatilities are based on historical volatility of peer companies and other factors estimated over the expected term of the stock options. The expected term of options granted is derived using the “simplified method” which computes expected term as the average of the sum of the vesting term plus the contract term. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant for the period of the expected term.

Accounting for Uncertainty in Income Taxes

The Company follows the provisions of ASC Topic 740-10, “Accounting for Uncertainty in Income Taxes” which clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. This topic also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. There is no uncertain tax positions as of September 30, 2020 and December 30, 2019.

Income Tax Policy

The Company accounts for income taxes using the liability method prescribed by ASC 740 - Income Taxes. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial reporting and tax bases of assets and liabilities using enacted tax rates that will be in effect in the year in which the differences are expected to reverse. The Company records a valuation allowance to offset deferred tax assets if based on the weight of available evidence, it is more-likely-than-not that some portion, or all, of the deferred tax assets will not be realized. The effect on deferred taxes of a change in tax rates is recognized as income or loss in the period that includes the enactment date.

Research and Development Costs

The Company’s research and development costs are expensed in the period in which they are incurred. Such expenditures amounted to $79,939 and $184,301 for the nine months ended September 30, 2020 and 2019, respectively. The expenditures amounted to $22,500 and $114,620 for the three months ended September 30, 2020 and 2019, respectively.

Earnings (Loss) Per Share

Earnings (loss) per share is computed in accordance with FASB ASC Topic 260, “Earnings per Share”. Diluted earnings per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock, common stock equivalents and other potentially dilutive securities outstanding during the period. Certain common stock equivalents were not included in the earnings (loss) per share calculation as their effect would be anti-dilutive. Warrants exercisable for 950,000 and 975,000 shares as of September 30, 2020 and September 30, 2019, respectively, were excluded from weighted average common shares outstanding on a diluted basis as well as options for 12,180,500 shares.

Financial Instruments

The Company carries cash, accounts receivable, accounts payable, accrued expenses and convertible notes payable, at historical costs. The respective estimated fair values of these assets and liabilities approximate carrying values due to their current nature.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

Note 4 – Recent Accounting Pronouncements

In August, 2020, the Financial Accounting Standards Board (“FASB”) issued ASU 2020-06, “Debt-Debt with Conversion and other options” which simplifies the accounting for convertible debt instruments and convertible preferred stock. The ASU is effective for public companies for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted. The Company is evaluating the impact ASU 2020-06 could have on its financial statements.

There are several other new accounting pronouncements issued or proposed by the FASB. Each of these pronouncements, as applicable, has been or will be adopted by the Company. Management does not believe any of these accounting pronouncements has had or will have a material impact on the Company’s condensed consolidated financial position, operating results, or cash flows.

Note 5 – Intellectual Property and License Agreement

On June 1, 2016, the Company entered into a ten-year License Agreement with Helidyne LLC for total consideration of $100,000 to utilize the Helidyne intellectual property in the manufacturing of planetary rotor expanders and the incorporation of same in the Company’s distributed electric power generation systems. The license agreement also grants the Company an exclusive license to sell the expanders whether manufactured by Helidyne or by the Company. The Company’s royalty obligation begins on the earlier of the commercialization of the product or three years from the effective date of the agreement. Once the royalty obligation begins, the minimum annual royalty is $50,000 for each of the first six years, and $100,000, per commercial year, for the remainder of the agreement. Helidyne has defaulted under the agreement. Royalties would be payable only if Helidyne performs as required, or if the Company elects to produce its own expanders using Helidyne technology.

In the second quarter of 2019, management of the Company evaluated the continued default by Helidyne and determined that Helidyne will not be able to perform under the license agreement for the foreseeable future. The Company’s license agreement continues to be active and the Company may utilize the Helidyne intellectual property in marketing its own products. Under the terms of the license agreement, the Company has the right to develop a prototype utilizing the Helidyne technology at its own cost. Due to the continued default by Helidyne and the potential cost of developing its own prototype, the Company has determined that the intangible asset related to the above license agreement is impaired and recognized an impairment charge of $69,178 in the second quarter of 2019, which is 100% of the net carrying value.

For the nine months ended September 30, 2020 and 2019, amortization expense was $0 and $5,000, respectively.

Note 6 - Convertible Notes Payable to Related and Nonrelated Parties

In January, March, and May 2019, the Company issued Convertible Promissory Notes totaling $200,000 to stockholders and $100,000 convertible note payable to a nonrelated party. The notes are to be paid in one principal payment, along with any unpaid interest by December 31, 2021. Interest is payable semiannually at 10%. The notes are convertible into common stock at a price of $.20 per share through December 31, 2019, $.30 per share from January 1, 2020 through December 31, 2020, and $.40 per share from January 1, 2021 through the maturity date of December 31, 2021.

In December 2019, the Company issued a Convertible Promissory Note in the principal amount of $25,000 to a stockholder in connection with a loan in the same amount. The note is to be paid in one principal payment, along with any unpaid interest by December 31, 2022. Interest is payable semiannually at 10%. The note is convertible into common stock at a price of $.20 per share through December 31, 2020, $.30 per share from January 1, 2021 through December 31, 2021, and $.40 per share from January 1, 2022 through the maturity date of December 31, 2022.

In March 2020, the Company issued a Convertible Promissory Note in the principal amount of $100,000 to a nonrelated party in connection with a loan in the same amount. The note is to be paid in one principal payment, along with any unpaid interest by December 31, 2022. Interest is payable semiannually at 10%. The note is convertible into common stock at a price of $.20 per share through December 31, 2020, $.30 per share from January 1, 2021 through December 31, 2021, and $.40 per share from January 1, 2022 through the maturity date of December 31, 2022.

In June 2020, the Company issued a Convertible Promissory Note in the principal amount of $25,000 to a stockholder in connection with a loan in the same amount. The note is to be paid in one principal payment, along with any unpaid interest by July 31, 2023. Interest is payable semiannually at 10%. The note is convertible into common stock at a price of $.20 per share through December 31, 2020, $.30 per share from January 1, 2021 through December 31, 2021, and $.40 per share from January 1, 2022 through the maturity date of July 31, 2023.

In the third quarter 2020, the Company issued Convertible Promissory Notes totaling $511,000, of which $25,000 was with a stockholder and the remaining $486,000 was with nonrelated accredited investors in connection with loans for the same amount. The notes are to be paid in one principal payment, along with any unpaid interest by December 31, 2023. Interest is payable semiannually at 10% on June 30 and December 31. The notes are convertible into common stock at a price of $.20 per share through December 31, 2020, $.30 per share from January 1, 2021 through December 31, 2021, and $.40 per share from January 1, 2022 through the maturity date of December 31, 2023.

Consequently, the Company has outstanding Convertible Promissory Notes in an aggregate principal amount of $961,000 through September 30, 2020, of which $275,000 are due to related parties and $686,000 are to nonrelated parties. See Note 11 for further related party transactions.

Total interest accrued of $13,564 and $185 as of September 30, 2020 and December 31, 2019, respectively, is included in the Accounts payable and accrued expenses on the Condensed Consolidated Balance Sheets.

The convertible promissory notes that were issued in the third quarter 2020 included a beneficial conversion feature, which is recorded as a discount against the notes and amortized through the earlier of the conversion into common stock, or the maturity date. Amortization of the debt discount is reported as interest expense in the income statement. The total debt discount associated with the beneficial conversion feature for the three and nine months ended September 30, 2020 was $472,300. Total amortization associated with the beneficial conversion feature debt discount was $6,366 for the three and nine months ended September 30, 2020

Total debt issuance costs were $2,025 and $12,625 for the three and nine months ended September 30, 2020, respectively. Total amortization associated with the debt issuance costs paid was $3,193 and $10,060 for the three and nine months ended September 30, 2020.

Convertible Notes Payable at September 30, 2020 and December 31, 2019 consisted of the following:

	September 30, 2020		December 31, 2019
Convertible notes payable to related parties	$	275,000	$	225,000
Less:
Unamortized debt discount		35,336		—
Unamortized debt issuance costs		11,420		13,100
Total convertible notes payable to related parties	$	228,244	$	211,900

Convertible notes payable	$	686,000	$	100,000
Less:
Unamortized debt discount		430,596
Unamortized debt issuance costs		9,893		5,646
Total convertible notes payable	$	245,511	$	94,354

Note 7 – Warrants

A summary of warrants issued, exercised and expired during the nine months ended September 30, 2020 is as follows:

	Shares			Weighted Average Exercise Price		Intrinsic Value
Balance at December 31, 2019		975,000		$	.11	$	0
Exercised		(25,000	)		.12		—
Balance at September 30, 2020		950,000		$	.11	$	225,000

On September 30, 2020, a shareholder exercised a warrant for 25,000 shares at $0.12 per share, totaling $3,000.

Note 8 – Stock Options

Stock option activity for the nine months ended September 30, 2020, is summarized as follows:

	Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)
Options outstanding at December 31, 2019		12,180,500	$	0.21		5.59
Options outstanding and exercisable at September 30, 2020		12,180,500	$	0.20		4.88

Total stock option compensation for the nine months ended September 30, 2020 and 2019 was $0 and $80,000, respectively. There is no unrecognized compensation expense associated with the options.

Note 9 – Stockholders’ Equity

During the nine months ended September 30, 2020, a shareholder exercised a warrant for 25,000 shares at $0.12 per share, totaling $3,000.

The Company also purchased from George Konrad, the Company’s founder and former CEO and Director (“Konrad”) all of Konrad’s 4,027,408 shares of Company common stock (the “Shares”), representing 12.7% of the Company’s issued and outstanding common stock, for an aggregate price of $300,000 ($.074 per share). The Company raised the funds used for the purchase of the shares through a private placement of convertible notes to stockholders and accredited investors (see Note 7).

Note 10 - Commitments and Contingencies

On June 25, 2015, Company consultant Hank Leibowitz assigned to the Company a patent he obtained for a system and method for using high temperature sources in Rankine cycle power systems. The Company has agreed to pay Mr. Leibowitz a 2% royalty for any and all revenues of products and/or project sales by the Company based on the subject patent. As of September 30, 2020, no royalties have been paid on this agreement.

On April 15, 2017, the Company entered into an assembly agreement with Liberty Plugins, Inc. (“Liberty”) to assemble Liberty’s Hydra electronic vehicle charging systems and ship completed Hydras to Liberty’s facility in Santa Barbara, California (the “Liberty Agreement”). Liberty has agreed to pay $1,000 for the first 10 Hydras assembled in a month, $750 per Hydra for the next 10 Hydras assembled per month and $500 per Hydra for each Hydra assembled above 20 per month. The Company has never assembled/shipped more than 10 Hydras in any month and does not expect to do so in the future. As of September 30, 2019, the Company has built and shipped 43 Hydras. Revenue for these products is reflected in the net revenue on the Company’s condensed consolidated statement of operations as follows: $25,000 and $9,000 for the nine months ended September 30, 2020 and 2019, respectively and $6,000 and $3,000 for the three months ended September 30, 2020 and 2019, respectively.

On September 20, 2020, the Company signed a Binding Letter of Intent for a merger (the “LOI”) with 374Water Inc. (“374Water”) a privately-held company based in Durham, North Carolina www.374water.com.

Subject to the terms and conditions set forth in the LOI, 374Water will merge into a newly- formed wholly-owned subsidiary of the Company (the “Sub”), with the Sub as the surviving corporation (the “Merger”). Upon closing of the Merger, the Company will issue new shares of common stock to 374Water shareholders such that 374Water shareholders will own approximately 60% of the combined company, and the Company’s shareholders will own approximately 40%. The Merger is subject to adjustments for liabilities, and the closing is contingent on the achievement of certain milestones and satisfaction of conditions by both parties prior to closing, including the raising of net proceeds of at least $6.25 million of additional capital pursuant to a private placement by March 31, 2021.

Note 11 - Related Party Transactions

On September 1, 2019, the Company hired Daniel Bogar to serve as its President, reporting to the CEO. As compensation, Mr. Bogar received a fully-vested non-qualified option to purchase 1,000,000 shares of the Company’s common stock at an exercise price of $.10 per share, with an expiration date of June 30, 2026. On September 1, 2020, the Company entered into a one-year employment agreement with Mr. Bogar at an annual salary of $90,000; however, the Company will be permitted to defer payment of the salary to the extent required to maintain solvency. Mr. Bogar was owed accrued compensation of $7,500 and $0 as of September 30, 2020 and December 31, 2019, respectively, which is presented in accounts payable and accrued expenses on the condensed consolidated balance sheets.

Since July 2010, the accounting firm J.L. Hofmann & Associates, P.A. (“JLHPA”), whose principal is our CFO John L. Hofmann, has provided financial consulting and accounting services to the Company. In December 2017, J.L. Hofmann & Associates, P.A. merged with Kabat, Schertzer, De La Torre, Taraboulos & Co, LLC (“KSDT”). The Company paid $33,200 and $19,100 for its services in the nine months ended September 30, 2020 and 2019, respectively.

The Company’s consultant and shareholder Hank Leibowitz receives compensation of $7,500 per month, totaling $45,000 for the nine months ended September 30, 2020 and 2019. Mr. Leibowitz was owed accrued compensation of $113,327 and $52,500 as of September 30, 2020 and December 31, 2019, respectively, which is presented in accounts payable and accrued expenses on the condensed consolidated balance sheets.

In connection with the convertible notes that were issued in 2019 and the first quarter of 2020, the Company accrued an 8% finder’s fee to its Chief Executive Officer, Richard Davis, totaling $34,000. For the convertible note that was issued in the second quarter of 2020, the Company accrued a 6.4% finder’s fee to Mr. Davis, totaling $1,600. For the convertible note that was issued in the third quarter of 2020, the Company accrued a 6.4% finder’s fee to Mr. Davis, totaling $2,025.

On September 1, 2020, the Company entered into a one-year employment agreement with Mr. Davis at an annual salary of $90,000; however, the Company will be permitted to defer payment of the salary to the extent required to maintain solvency. As per the terms of the agreement, Mr. Davis agreed to waive all rights to the finder’s fees. Mr. Davis was owed accrued compensation of $7,500 and $0 as of September 30, 2020 and December 31, 2019, respectively, which is presented in accounts payable and accrued expenses on the condensed consolidated balance sheets.

On September 30, 2020, the Company purchased from George Konrad, the Company’s founder and former CEO and Director (“Konrad”) all of Konrad’s 4,027,408 shares of Company common stock (the “Shares”), representing 12.7% of the Company’s issued and outstanding common stock, for an aggregate price of $300,000 ($.074 per share). The Company raised the funds used for the purchase of the shares through a private placement of convertible notes to stockholders and accredited investors.

See Note 6 for convertible notes payable with related parties.

Note 12 – Subsequent Events

In October 2020, the Company issued Convertible Promissory Notes totaling $250,000, to stockholders and accredited investors in connection with loans in the same amount. Each note is to be paid in one principal payment, along with any unpaid interest by December 31, 2023. Interest is payable semiannually at 10%. Each note is convertible into common stock at a price of $.20 per share through December 31, 2020, $.30 per share from January 1, 2021 through December 31, 2021, and $.40 per share from January 1, 2022 through the maturity date of December 31, 2023.

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

Forward Looking Statements

Readers are cautioned that the statements in this Report that are not descriptions of historical facts may be forward-looking statements that are subject to risks and uncertainties. This Report contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements are based on the beliefs of our management, as well as on assumptions made by and information currently available to us as of the date of this Report. When used in this Report, the words “plan,” “will,” “may,” “anticipate,” “believe,” “estimate,” “expect,” “intend,” “project” and similar expressions are intended to identify such forward-looking statements. Although we believe these statements are reasonable, actual actions, operations and results could differ materially from those indicated by such forward-looking statements as a result of the risk factors included in our 2016 Annual Report, or other factors. We must caution, however, that this list of factors may not be exhaustive and that these or other factors, many of which are outside of our control, could have a material adverse effect on us and our ability to achieve our objectives. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements set forth above.

The following discussion and analysis should be read in conjunction with the financial statements and notes thereto appearing elsewhere herein.

Critical Accounting Policies

The condensed consolidated financial statements of PowerVerde, Inc. are prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of these condensed consolidated financial statements requires our management to make estimates and assumptions about future events that effect the amounts reported in the financial statements and related notes. Future events and their effects cannot be determined with absolute certainty. Therefore, the determination of estimates requires the exercise of judgment. We believe the following critical accounting policies affect its more significant judgments and estimates used in the preparation of financial statements

Accounting for Uncertainty in Income Taxes

Based on our evaluation, we have concluded that there are no significant uncertain tax positions requiring recognition in our condensed consolidated financial statements. Our evaluation was performed for the tax years ended December 31, 2016, 2017, 2018 and 2019, the tax years which remain subject to examination by major tax jurisdictions as of September 30, 2020.

We may from time to time be assessed interest or penalties by major tax jurisdictions, although any such assessments historically have been minimal and immaterial to our financial results. In the event we have received an assessment for interest and/or penalties, it has been classified in the condensed consolidated financial statements as general and administrative expense.

Revenue Recognition

Revenue from royalties and assembly services unrelated to the Company’s planned operations is recognized when the goods or services are transferred to the customer. Royalties are recognized as earned in the period the sales to which the royalties relate occur. Manufacturing assembly services are recognized as revenue when the assembled product is delivered to the customer. Revenues recognized under these agreements amount to 100% of total revenues for the three and nine months ended September 30, 2020 and 2019.

Common Stock Purchase Warrants

The Company accounts for common stock purchase warrants in accordance with ASC Topic 815-40, Derivatives and Hedging – Contracts in Entity’s Own Equity (“ASC 815-40”). Based on the provisions of ASC 815-40, the Company classifies as equity any contracts that (i) require physical settlement or net-share settlement, or (ii) gives the Company a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement). The Company classifies as assets or liabilities any contracts that (i) require net-cash settlement including a requirement to net cash settle the contract if an event occurs and if that event is outside the control of the Company), or (ii) give the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement). All outstanding warrants as of September 30, 2020 and December 31, 2019 were classified as equity.

Intellectual Property

Stock-based compensation.

We account for stock-based compensation based on ASC Topic 718-Stock Compensation which requires expensing of stock options and other share-based payments based on the fair value of each stock option awarded. The fair value of each stock option is estimated on the date of grant using the Black-Scholes valuation model. This model requires management to estimate the expected volatility, expected dividends, and expected term as inputs to the valuation model.

Overview

From January 1991 until October 2005, the Company devoted substantially all of its efforts and resources to research and development related to its unsuccessful Biotech Business, in particular the study of biological oxidation and antioxidation directed to the development of potential therapeutic products for the treatment of various diseases and conditions. In the most recent years, the Company’s research focused mainly on targeted antioxidant therapeutics and nutraceuticals. The Company, has generated only limited revenue from product sales and has relied primarily on equity financing, licensing revenues, and various debt instruments for its working capital. The Company has been unprofitable since its inception.

Following the cessation of material Biotech Business operations in October 2005, the Company turned its primary focus to seeking an appropriate merger partner for its public shell. This resulted in the February 2008 Merger with Vyrex. In March 2009, we assigned most of our Biotech intellectual property other than our rights under existing licensing agreements (the “Biotech IP”) to an investor in exchange for his agreement to pay all future expenses relating to the Biotech IP and to pay us 20% of any net proceeds received from future sale and/or licensing of the Biotech IP. We do not expect this arrangement to generate material revenues.

Since the Merger, we have focused on the development, testing and commercialization of our electric power systems, in particular, their applicability to thermal and natural gas pipeline operations. Our business is subject to significant risks, including the risks inherent in our research and development efforts, uncertainties associated with obtaining and enforcing patents and intense competition. See “Risk Factors” in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on April 14, 2020.

Except as specifically noted to the contrary, the following discussion relates only to PowerVerde since, as a result of the Merger, the only historical financial statements presented for the Company in periods following the Merger are those of the operating entity, PowerVerde.

Results of Operations

Three Months Ended September 30, 2020 as Compared to Three Months Ended September 30, 2019

Since inception, we have focused on the development, testing and commercialization of our clean energy electric power generation systems. We generated $6,000 and $3,000 in revenue for assembly revenues under the Liberty Agreement in the third quarter of 2020 and 2019, respectively. In both years, we had substantial expenses due to our ongoing research and development activities and efforts to commercialize our systems, as well as substantial administrative expenses associated with our status as a public company. Our general administrative expenses increased by $32,989 (66.1%) in the third quarter of 2020 as compared to the third quarter of 2019, primarily because of increased legal fees and payroll expenses. Our research and development expenses decreased by $92,120 (80.4%), primarily because of a decrease in stock options issued for services. Substantial net losses are expected until we are able to successfully commercialize and market our systems, as to which there can be no assurance.

Nine Months Ended September 30, 2020 as Compared to Nine Months Ended September 30, 2019

Since inception, we have focused on the development, testing and commercialization of our clean energy electric power generation systems. We generated $25,000 and $9,000 in revenue for assembly revenues under the Liberty Agreement in the first nine months of 2020 and 2019, respectively. In both years, we had substantial expenses due to our ongoing research and development activities and efforts to commercialize our systems, as well as substantial administrative expenses associated with our status as a public company. Our general administrative expenses increased by $30,828 during the nine months ended September 30, 2020 as compared to the nine months ended September 30, 2019, primarily because of increase of legal fees, personnel costs and travel expenses. Our research and development expenses decreased by $104,362 (56.6%), primarily because of a decrease in stock options issued for services. Substantial net losses are expected until we are able to successfully commercialize and market our systems, as to which there can be no assurance.

Liquidity and Capital Resources

We have financed our operations since inception principally through the sale of debt and equity securities. Also, from 2012 through March 2018 we received material amounts of Biotech IP licensing fees. As of September 30, 2020, we had a working capital deficit of $14,203 compared to a working capital deficit of $63,638 at December 31, 2019. This decrease in the working capital deficit is due primarily to cash raised through related party debt financing.

Our Biotech IP license agreement expired in March 2018 due to the expiration of our underlying patents. Consequently, we have no further material source of revenues. We are generating some revenue by using our employee to provide part-time skilled manufacturing services to third parties; however, we expect this arrangement to generate no more than $5,000 per month. We expect to generate substantial revenue from the 374 Water/Duke project in 2021 if we receive the expected purchase order; however, there can be no assurance that we will receive the purchase order.

We continue to seek funding from private equity and debt investors, as we need to promptly raise substantial additional capital in order to finance our plan of operations and commercialize our systems. There can be no assurance that we will be able to promptly raise the necessary funds. If we do not promptly raise the necessary funds, we may be forced to cease operations.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

Not applicable.

Item 4. Controls and Procedures.

Disclosure Controls and Procedures

The Company, under the supervision and with the participation of its management, including the Chief Executive Officer and President, evaluated the effectiveness of the design and operation of the Company’s “disclosure controls and procedures” (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective.

Management’s Annual Report on Internal Control over Financial Reporting

Management of the Company is responsible for establishing and maintaining adequate control over financial reporting. Our internal control system was designed to provide reasonable assurance to our management and Board of Directors regarding the preparation and fair presentation of financial statements.

All internal controls over financial reporting, no matter how well designed, have inherent limitations, including the possibility of human error and the circumvention of overriding of controls. Therefore, even effective internal control over financial reporting can provide only reasonable, and not absolute, assurance with respect to financial statement preparation and presentation. Further, because of changes in conditions, the effectiveness of internal controls over financial reporting may vary over time. Because of its inherent limitations, internal controls over financial reporting may also fail to prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance of achieving their control objectives.

Our Chief Executive Officer and Chief Financial Officer assessed the effectiveness of our internal control over financial reporting as of December 31, 2019. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control—An Integrated Framework. Based on this evaluation, our management concluded that, as of September 30, 2020, our internal control over financial reporting was effective.

No Attestation Report

This quarterly report does not include an attestation report of the Company’s independent registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the Company’s registered public accounting firm pursuant to rules of the Securities and Exchange Commission that permit the Company to provide only management’s report in this quarterly report.

Changes in Internal Control over Financial Reporting

There were no significant changes in internal control over financial reporting during the third quarter of 2020 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II OTHER INFORMATION

Item 1. Legal Proceedings.

None.

Item 1A. Risk Factors.

There are no material changes to the risk factors set forth in Part I, Item 1A, “Risk Factors,” of the 2019 Annual Report. Please refer to that section for disclosure regarding the risks and uncertainties related to our business.

A novel strain of coronavirus (“Covid-19”) emerged globally in December 2019 and has been declared a pandemic. The extent to which Covid-19 will impact our customers, business, results and financial condition will depend on current and future developments, which are highly uncertain and cannot be predicted at this time

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

All of PowerVerde’s sales of unregistered securities since inception have been made pursuant to private offerings to accredited investors. The sales set forth below were made pursuant to an exemption from registration requirements under Regulation D and/or Section 4(2) of the Securities Act of 1933, as amended. Except as otherwise noted below, no placement agent fees or commissions were paid on these offerings, and net proceeds were used for working capital.

In June 2020, we issued a Convertible Promissory Note in the principal amount of $25,000 to a stockholder in connection with a loan in the same amount. The note is to be paid in one principal payment, along with any unpaid interest by December 31, 2023. Interest is payable semiannually at 10%. The note is convertible into common stock at a price of $.20 per share through December 31, 2020, $.30 per share from January 1, 2021 through December 31, 2021, and $.40 per share from January 1, 2022 through the maturity date of December 31, 2023.

In the third quarter 2020, we issued Convertible Promissory Notes totaling $511,000 to stockholders and accredited investors in connection with loans for the same amount. The notes are to be paid in one principal payment, along with any unpaid interest by December 31, 2023. Interest is payable semiannually at 10%. The notes are convertible into common stock at a price of $.20 per share through December 31, 2020, $.30 per share from January 1, 2021 through December 31, 2021, and $.40 per share from January 1, 2022 through the maturity date of December 31, 2023.

In October 2020, we issued Convertible Promissory Notes totaling $250,000, to stockholders and accredited investors in connection with loans in the same amount. Each note is to be paid in one principal payment, along with any unpaid interest by December 31, 2023. Interest is payable semiannually at 10%. Each note is convertible into common stock at a price of $.20 per share through December 31, 2020, $.30 per share from January 1, 2021 through December 31, 2021, and $.40 per share from January 1, 2022 through the maturity date of December 31, 2023.

Item 3. Defaults upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

On September 30, 2020, we purchased from George Konrad, PowerVerde’s founder and former CEO and Director (“Konrad”) all of Konrad’s 4,027,408 shares of PowerVerde common stock (the “Shares”), representing 12.7% of PowerVerde’s issued and outstanding common stock, for an aggregate price of $300,000 ($.074 per share). PowerVerde raised the funds used for the purchase of the shares through a private placement of convertible notes to accredited investors.

On September 1, 2020, we entered into one-year employment agreements with Messrs. Bogar and Davis at an annual salary of $90,000; however, we are permitted to defer payment of the salary to the extent required to maintain solvency.

In connection with this agreement, Mr. Davis agreed to waive accrued finder’s fees totaling $37,625.

Item 6. Exhibits.

(a)	Exhibits

99.1	Employment Agreement dated September 1, 2020 between PowerVerde Inc. and Daniel T. Bogar.

99.2	Employment Agreement dated September 1, 2020 between PowerVerde Inc. and Richard H. Davis.

31.1	Certification of Principal Executive Officer and Principal Accounting Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1	Certification of Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2	Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS	XBRL INSTANCE DOCUMENT

101.SCH	XBRL TAXONOMY EXTENSION SCHEMA

101.CAL	XBRL TAXONOMY EXTENSION CALCULATION LINKBASE

101.DEF	XBRL TAXONOMY EXTENSION DEFINITION LINKBASE

101.LAB	XBRL TAXONOMY EXTENSION LABEL LINKBASE

101.PRE	XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE

SIGNATURES

In accordance with Section 13(a) or 15(d) of the Exchange Act, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

	POWERVERDE, INC.

Dated: November 13, 2020	By:	/s/ Richard H. Davis

		Richard H. Davis
		Chief Executive Officer

Dated: November 13, 2020	By:	/s/ John L. Hofmann

		John L. Hofmann
		Chief Financial Officer

Exhibit Index

Exhibit No.		Description

99.1		Employment Agreement dated September 1, 2020 between PowerVerde Inc. and Daniel T. Bogar.

99.2		Employment Agreement dated September 1, 2020 between PowerVerde Inc. and Richard H. Davis.

31.1		Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2		Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1		Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2		Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS		XBRL INSTANCE DOCUMENT

101.SCH		XBRL TAXONOMY EXTENSION SCHEMA

101.CAL		XBRL TAXONOMY EXTENSION CALCULATION LINKBASE

101.DEF		XBRL TAXONOMY EXTENSION DEFINITION LINKBASE

101.LAB		XBRL TAXONOMY EXTENSION LABEL LINKBASE

101.PRE		XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE