UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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For the quarter ended |
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[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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Commission file number
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation or organization)
(Address of principal executive offices, including zip code.)
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(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES [X] NO [ ]
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-Y (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). YES [X] NO [ ]
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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a small reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “small reporting company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer [ ]Accelerated filer [ ]
Non-accelerated filer [ ]Smaller reporting company [X]
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes [ ] No [X]
As of November 14, 2018, there are
All references in this Report on Form 10-Q to the terms “we”, “our”, “us”, the “Company”, “ICNN” and the “Registrant” refer to Incoming, Inc. unless the context indicates another meaning.
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ITEM 1. FINANCIAL STATEMENTS
Index to the Unaudited Financial Statements3
CONSOLIDATED STATEMENTS OF OPERATIONS5
CONSOLIDATED STATEMENTS OF CASH FLOWS6
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS7
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INCOMING, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
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| September 30, 2018 |
| December 31, 2017 |
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Total Assets | $ | $ | ||||
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LIABILITIES AND STOCKHOLDERS’ DEFICIT | ||||||
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Capital stock $ |
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Accumulated deficit |
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Total Stockholders’ Deficit |
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Total Liabilities and Stockholders' Deficit | $ | $ | ||||
The accompanying notes are an integral part of these unaudited consolidated financial statements.
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INCOMING, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
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| Nine months ended September 30, 2018 |
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Revenue | $ |
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Loss from Operations | ( |
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Net Loss | $( |
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| Net Loss per Class A Common Share (Basic and Diluted) | $( |
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| Net Loss per Class B Common Share (Basic and Diluted) | $( |
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The accompanying notes are an integral part of these unaudited consolidated financial statements.
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INCOMING, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
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Nine months ended September 30, 2018 |
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Cash Flows from operating Activities |
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Net loss | $ | ( | $ | ( | |
Adjustments to reconcile net loss to net cash used in operations: |
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Inventory |
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Payments on loan from employee |
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Proceeds from related party debt |
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Payments on short-term debt |
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Net decrease in cash for the period |
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Cash at end of period |
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Supplemental disclosure of cash flow information |
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Cash paid for interest | $ | $ | |||
Cash paid for income taxes | $ | $ | |||
Non-cash financing transactions |
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Prepaid expense financed with notes payable | $ | $ | |||
Accounts payable - related party reclassified to notes payable - related party | $ | $ | |||
The accompanying notes are an integral part of these unaudited consolidated financial statements.
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INCOMING, INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1Basis of Presentation, Organization, and Summary of Significant Accounting Policies
Organization
Incoming, Inc. (“we” or the “Company”) was incorporated on
Impairment of Long-Lived Assets
Long-lived assets, including property and equipment, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. The evaluation of recoverability is performed using undiscounted estimated net cash flows generated by the related asset. If an asset is deemed to be impaired, the amount of impairment is determined as the amount by which the net carrying value exceeds discounted estimated net cash flows. As a result of the analysis, the Company determined it necessary to record an impairment loss of $
Revenue Recognition
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sales, from RIN (Renewable Identification Numbers) sales, and from kerosene sales. We also generate revenue from biodiesel import activities.
On January 1, 2018, the Company adopted Topic 606 using the modified retrospective method applied to those contracts which were not completed as of January 1, 2018. Results for reporting periods beginning after January 1, 2018 are presented under Topic 606, while prior period amounts are not adjusted and continue to be reported in accordance with our historic accounting under Topic 605.
We did not have a cumulative impact as of January 1, 2018 due to the adoption of Topic 606 and there was not an impact to our statement of operations for the nine months ended September 30, 2018 as a result of applying Topic 606.
Reclassification
Certain reclassifications have been made to conform the prior period’s financial information to the current period’s presentation. These reclassifications had no effect on previously reported net loss or accumulated deficit.
Loss per Share
The Company follows ASC Topic 260 to account for the loss per share. Basic loss per common share calculations are determined by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted loss per common share calculations are determined by dividing net loss by the weighted average number of common shares and dilutive common share equivalents outstanding. During periods when common stock equivalents, if any, are anti-dilutive they are not considered in the computation.
Note 2Going Concern
These financial statements have been prepared on a going concern basis. As of September 30, 2018, the Company had a working capital deficiency of $
Note 3Related Party Transactions
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party totaled $
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
THE FOLLOWING DISCUSSION OF THE RESULTS OF OUR OPERATIONS AND FINANCIAL CONDITION SHOULD BE READ IN CONJUNCTION WITH OUR FINANCIAL STATEMENTS AND THE NOTES THERETO INCLUDED ELSEWHERE IN THIS REPORT.
This section of the report includes a number of forward-looking statements that reflect the Company’s current views with respect to future events and financial performance. Forward-looking statements are often identified by words like: "believe," "expect," "estimate," "anticipate," "intend," "project" and similar expressions, or words which, by their nature, refer to future events. You should not place undue certainty on these forward-looking statements, which apply only as of the date of this annual report. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or our predictions.
The following discussion provides an analysis of the results of our operations, an overview of our liquidity and capital resources and other items related to our business. The following discussion and analysis should be read in conjunction with our unaudited consolidated financial statements and related notes included in this Quarterly Report on Form 10-Q and our audited financial statements and notes included in our Annual Report on Form 10-K as of and for the year ended December 31, 2017.
Overview
Company references herein are referring to consolidated information pertaining to Incoming, Inc., the registrant.
The following discussion is an overview of the important factors that management focuses on in evaluating our businesses, financial condition and operating performance and should be read in conjunction with the financial statements included in this Quarterly Report on Form 10-Q. This discussion contains forward-looking statements that involve risks and uncertainties. Actual results could differ materially from those anticipated in these forward looking statements as a result of any number of factors, including those set forth in this Quarterly Report and elsewhere in the Company’s Annual Report on Form 10-K and other public filings.
All written and oral forward-looking statements made in connection with this Quarterly Report on Form 10-Q that are attributable to us or persons acting on our behalf are expressly qualified in their entirety by these cautionary statements. Given the uncertainties that surround such statements, you are cautioned not to place undue reliance on such forward-looking statements.
Company Overview
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NABE has historically been a refiner and producer of commercial-grade biodiesel as specified by the American Society of Testing and Materials (ASTM D6751). Our refining and production facility is located in Lenoir, North Carolina with a nameplate annual capacity of five million gallons. The Lenoir plant is currently idle due to adverse market conditions. Our facility has the ability to produce biodiesel from virgin, agri-based feedstock using commercial specifications. The biodiesel we produce is sold throughout North Carolina, South Carolina and Virginia directly or through wholesale distributors. At times, we have strategically purchased biodiesel from other producers to meet commercial requirements. We also purify and sell glycerin, which is created as a byproduct of the biodiesel production process. Once the facility has accumulated sufficient glycerin to make full loads, it is typically sold to the market.
Our production process starts with purchasing the most cost effective and suitable agri-based feedstock (e.g., soy, canola, sunflower, cotton seed and chicken/pork fat). A sample of every feedstock is tested by our in-house laboratory in order to develop the proper recipe of catalysts for the transesterification process. The glycerin byproduct is then separated from the biodiesel and any excess methanol is recovered. Recovered methanol is either sold or reused in the production process. Glycerin is sold on the open market as either a crude product or as a further-processed tech grade product. While biodiesel is our main product, glycerin is a popular chemical used in pharmaceutical and hygiene applications and serves as an additional source of revenue.
Our facility is capable of producing biodiesel from a wide range of agri-based feedstocks: soy, canola, sunflower, cotton seed and chicken/pork fat. Biodiesel production costs are highly dependent on the cost of feedstock, and we believe the ability to utilize a variety of feedstocks efficiently and interchangeably is imperative to gaining a competitive advantage in the biodiesel production market.
Results of Operations
The following is a discussion and analysis of our results of operations for the three and nine-month periods ended September 30, 2018 and 2017, and the factors that could affect our future financial condition. This discussion and analysis should be read in conjunction with our financial statements and the notes thereto included elsewhere in this report. Our financial statements are prepared in accordance with United States generally accepted accounting principles. All references to dollar amounts in this section are in United States dollars unless expressly stated otherwise.
Revenue and Revenue From Related Parties
The Company generated no revenues during the period July 1, 2018 through September 30, 2018.
The Company generated no revenue during the period July 1, 2017 through September 30, 2017.
Comparing the Company’s activity for the period July 1, 2018 through September 30, 2018 to the activity for the period July 1, 2017 through September 30, 2017, there was no change in revenue. Revenue for both periods was zero due to idling the biodiesel production in Lenoir, NC.
The Company generated no revenues during the period January 1, 2018 through September 30, 2018.
The Company generated revenues of $71,035 during the period January 1, 2017 through September 30, 2017. Revenue generated during the period was due to sales of biodiesel, kerosene, de-methylated glycerin, and recovered methanol. Third-party transactions during the first three quarters of 2017 included biodiesel sales totaling $43, diluted methanol sales of $2,904, de-methylated glycerin sales of $2,775, and recovered methanol sales of $658. Related party kerosene sales totaled $64,655 during the period under consideration.
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Comparing the Company’s activity for the period January 1, 2018 through September 30, 2018 to the activity for the period January 1, 2017 through September 30, 2017, there was a decrease in revenue of $71,035 from $71,035 to zero. The period-over-period decrease was primarily due to sale of kerosene to a related party that occurred during the first nine months of the prior year. Kerosene sales totaled $64,655 during the first nine months of 2017, but there were no kerosene sales during the same period in 2018. Biodiesel sales totaled $43 in the first nine months of 2017 but were no sales during the same period in 2018. De-methylated glycerin sales totaled $2,775 during the first nine months of 2017 compared with no sales of the recovered product during the same period in 2018. Methanol sales (diluted and recovered) were $3,562 in the first nine months of 2017 while there were none in the same period for 2018.
Cost of Revenue
Cost of revenue totaled $8,246 during the period July 1, 2018 through September 30, 2018. For the same period, cost of revenue consisted of costs associated with salaries, overhead, and utilities.
Cost of revenue totaled $9,928 during the period July 1, 2017 through September 30, 2017. For the same period, cost of revenue consisted of costs associated with payroll, overhead, and utilities.
Comparing the Company’s activity for the period July 1, 2018 through September 30, 2018 to the activity for the period July 1, 2017 through September 30, 2017, there was a decrease in cost of revenues of $1,682 from $9,928 to $8,246. The period-over-period decrease was in line with reduced production activity and also affected by operating with fewer personnel at the biodiesel facility in Lenoir, NC.
Cost of revenue totaled $26,478 during the period January 1, 2018 through September 30, 2018. For the same period, cost of revenue consisted of costs associated with salaries, overhead, and utilities.
Cost of revenue totaled $122,191 during the period January 1, 2017 through September 30, 2017. For the same period, cost of revenue consisted of costs associated with kerosene purchases, labor, overhead, and utilities.
Comparing the Company’s activity for the period January 1, 2018 through September 30, 2018 to the activity for the period January 1, 2017 through September 30, 2017, there was a decrease in cost of revenues of $95,713 from $122,191 to $26,478. The period-over-period decrease was reflective of the Company’s inability to sell kerosene during the current year. During the first nine months of 2017, the Company purchased and re-sold kerosene. There were no kerosene purchases flowing through cost of sales since there were no sales during the first nine months of 2018.
Gross Loss
The Company had a gross loss of $16,500 for the period July 1, 2018 through September 30, 2018. The primary reason for the gross loss during the period was the Company’s inability to produce and sell biodiesel under adverse market conditions.
The Company had a gross loss of $25,778 for the period July 1, 2017 through September 30, 2017. The primary reason for the gross loss during the period was the Company’s inability to produce and sell biodiesel under adverse market conditions, including lower petroleum benchmark prices.
The Company had a gross loss of $50,970 for the period January 1, 2018 through September 30, 2018. The primary reason for the gross loss during the period was the Company’s inability to produce and sell biodiesel under adverse market conditions.
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The Company had a gross loss of $100,688 for the period January 1, 2017 through September 30, 2017. The primary reason for the gross loss during the period was the Company’s inability to produce and sell biodiesel under adverse market conditions, including lower petroleum benchmark prices.
Selling, General and Administrative (SG&A) Expenses
The Company had an impairment loss of $247,162 on property and equipment during the three and nine months ended September 30, 2018.
SG&A expenses totaled $17,469 for the period July 1, 2018 through September 30, 2018. During the period under consideration, SG&A expenses primarily consisted of costs associated with payroll, office overhead and professional fees.
SG&A expenses totaled $14,159 for the period July 1, 2017 through September 30, 2017. During the period under consideration, SG&A expenses primarily consisted of costs associated with payroll, office overhead and professional fees.
Comparing the Company’s activity for the period July 1, 2018 through September 30, 2018 to the activity for the period July 1, 2017 through September 30, 2017, there was an increase in SG&A expenses of $3,310 as SG&A increased from $14,159 to $17,469. The period-over-period increase is related to professional fees incurred during the third quarter of the current year which were not incurred in the third quarter of the prior year.
SG&A expenses totaled $55,471 for the period January 1, 2018 through September 30, 2018. During the period under consideration, SG&A expenses primarily consisted of costs associated with payroll, office overhead and professional fees.
SG&A expenses totaled $57,080 for the period January 1, 2017 through September 30, 2017. During the period under consideration, SG&A expenses primarily consisted of costs associated with payroll, office overhead and professional fees.
Comparing the Company’s activity for the period January 1, 2018 through September 30, 2018 to the activity for the period January 1, 2017 through September 30, 2017, there was a decrease in SG&A expenses of $1,609 as SG&A declined from $57,080 to $55,471. The period-over-period decrease is related to reduced staffing costs considering the first nine months of the current year compared with the first nine months of the prior year.
Other Income (Expense)
The Company had no Other Income during the period July 1, 2018 through September 30, 2018.
Other Income totaled $1,464 during the period July 1, 2017 through September 30, 2017. During the third quarter of 2017, this amount was attributable to a rebate from our insurance carrier. Our carrier performed an audit of 2016 and determined that we were eligible for a refund. The refund was recorded in Other Income, instead of an offset to insurance expense, since its basis was an audit of a prior year.
The Company had no Other Income during the period January 1, 2018 through September 30, 2018.
Other Income totaled $1,666 during the period January 1, 2017 through September 30, 2017. During the third quarter of 2017, this amount was attributable to $202 in funding received from the USDA Biofuel Program and from receiving $1,464 in rebates from our insurance carrier. Each quarter, the Company submits a Payment Request (Form RD-4288) and supporting documents to the USDA delineating those
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gallons produced/sold. Along with the documentation, the Company informs the USDA regarding the type and quantity of feedstocks utilized. These payment requests are reviewed by an agent of the USDA and then submitted as part of the “pool” for funding. Biodiesel producers compete for whatever funding is available from the USDA’s pool. Since it is difficult to predict the amount of funding that may be received, the Company only recognizes Other Income associated with the USDA Biofuel Program when the funds are received.
Liquidity and Capital Resources
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Working Capital
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| As of September 30, 2018 |
| As of December 31, 2017 |
Current Assets | $ | 628 | $ | 7,929 |
Current Liabilities | $ | 773,924 | $ | 699,206 |
Working Capital Deficiency | $ | (773,296) | $ | (691,277) |
Accumulated Deficit | $ | (7,289,120) | $ | (6,935,447) |
Cash Flows
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| Nine Months Ended September 30, 2018 |
| Nine Months Ended September 30, 2017 |
Cash used in operating activities | $ | (78,440) | $ | (59,902) |
Cash provided by investing activities |
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| 14,271 |
Cash provided by financing activities |
| 74,960 |
| 34,921 |
Net decrease in cash | $ | (3,480) | $ | (10,710) |
As of September 30, 2018, our current assets totaling $628 consisted of accounts receivable, and other current assets. Our accounts payable and accrued liabilities and current portion of amounts due to related parties and third parties were $773,924 as of September 30, 2018. As a result, we had a working capital deficiency of $773,296.
Current assets for the Company totaled $7,929 as of December 31, 2017. Current liabilities for the Company totaled $699,206 as of December 31, 2017, which resulted in a working capital deficiency of $691,277.
Comparing the working capital deficiency at September 30, 2018 to the deficiency at December 31, 2017, there was an increase of $82,019 as the deficiency increased from $691,277 to $773,296. The biggest contributor to the overall increase was the Company’s reduced production activity. Production activity was negatively impacted by lower petrodiesel (benchmark) market prices, and due to relatively higher feedstock prices.
On a short-term basis, it is anticipated that the Company’s liquidity needs will be met through selling biodiesel related products and RIN-gallons, through borrowing from related parties and through the sale of common stock. Considering the long-term view, the Company intends to provide liquidity through operation of its biodiesel plant in Lenoir, North Carolina. Since the December 31, 2017 balance sheet date, no amounts of receivables were written off.
To date, cash flow requirements have been primarily met through sales of biodiesel related products, through collections of accounts receivable, through share issuances, and through gross proceeds from bank and related party loans. Management expects to keep operational costs to a minimum until cash is available through financing or operating activities. Management plans to continue to seek other sources of financing on favorable terms; however, there are no assurances that any such financing can be obtained on favorable terms, if at all. For the nine months ended September 30, 2018, the Company generated a gross loss of $50,970 on no sales over the same period. For the nine months ended September 30, 2017, the Company generated a gross loss of $100,688 on sales of $71,035 over the same period.
A portion of the Company’s operations have been funded through the issuance of common stock shares. As of September 30, 2018, the Company has issued 33,754,332 shares of common stock (31,774,332 shares of Class A stock and 1,980,000 shares of Class B stock).
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Cash Used In Operating Activities
During the period January 1, 2018 through September 30, 2018, the Company’s cash used in operating activities totaled $78,440. For the same period, the Company’s cash used in operating activities was primarily attributable to amortizing prepaid insurance and to making payments on trade payables. Insurance amortization totaled $3,821 while payables decreased $198 during the first nine months of 2018. Depreciation expense was $24,492 and there was an impairment charge of $247,162 for the first nine months of 2018.
During the period January 1, 2017 through September 30, 2017, the Company’s cash used in operating activities totaled $59,902. For the same period, the Company’s cash used in operating activities was primarily attributable to the net loss, which was offset by collecting trade receivables, by selling inventory, by accruing additional expenses, and by making transactions on trade payables. Third party trade receivables decreased $11,818 while inventories decreased $13,787 and prepaid expenses decreased $6,346. Third party trade payables and accrued expenses increased $9,111 and $5,869, respectively, for the same period. Depreciation expense was $49,532 for the first nine months of 2017.
Cash Provided By Investing Activities
During the period January 1, 2018 through September 30, 2018, the Company had no cash flow related to investing activities.
During the period January 1, 2017 through September, 2017, the Company’s cash flows provided by investing activities totaled $14,271. Cash provided by investing activity resulted from the sale of equipment comprising the diesel exhaust fluid (DEF) production system. The equipment was sold to a third party at book value, therefore, no gain or loss was recorded on the sale.
Cash Provided By Financing Activities
During the period January 1, 2018 through September 30, 2018, the Company’s cash provided by to financing activities totaled $74,960. This amount represents proceeds provided from short-term financing from a related party, net of payments on short-term debt.
During the period January 1, 2017 through September 30, 2017, the Company’s cash flow related to financing activities totaled $34,921. This amount represents proceeds provided from short-term financing from a related party and employee loan during the period under consideration.
Future Financings
We anticipate that additional funding will be required in the form of equity financing from the sale of our common stock in order to proceed with our acquisition and expansion plan. However, we cannot provide investors with any assurance that we will be able to raise sufficient funding from the sale of our common stock to fund our marketing and acquisition plans. At this time, we do not have any arrangements in place for any future equity financing.
Off-Balance Sheet Arrangements
We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.
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Recent Accounting Pronouncements
Management does not expect any financial statement impact from any recently-issued pronouncements.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information required under this item.
ITEM 4. CONTROLS AND PROCEDURES
(a)Evaluation of Disclosure Controls and Procedures
As of the end of the period covered by this Quarterly Report on Form 10-Q, we conducted an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer (“CEO”) and Principal Financial Officer, of our disclosure controls and procedures (as defined in Rules13a-15(e) and 15d-15(e) under the Exchange Act). Based on this evaluation, the CEO and Principal Financial Officer concluded that our disclosure controls and procedures were not effective as of September 30, 2018. We have identified the following material weaknesses in our internal control over financial reporting:
Lack of Independent Board of Directors and Audit Committee
Management is aware that an audit committee composed of the requisite number of independent members along with a qualified financial expert has not yet been established. Considering the costs associated with procuring and providing the infrastructure to support an independent audit committee and the limited number of transactions, management has concluded that the risks associated with the lack of an independent audit committee are not sufficient to justify the creation of such a committee at this time. Management will periodically reevaluate this situation.
Deficiencies in Our Control Environment.
Our control environment did not sufficiently promote effective internal control over financial reporting throughout the organization. This material weakness exists because of the aggregate effect of multiple deficiencies in internal control which affect our control environment, including: a) the lack of an effective risk assessment process for the identification of fraud risks; b) the lack of an internal audit function or other effective mechanism for ongoing monitoring of the effectiveness of internal controls; c) deficiencies in our accounting system and controls; d) and insufficient documentation and communication of our accounting policies and procedures as of September 30, 2018.
Deficiencies in the staffing of our financial accounting department.
The number of qualified accounting personnel with experience in public company SEC reporting and GAAP is limited. This weakness does not enable us to maintain adequate controls over our financial accounting and reporting processes regarding the accounting for non-routine and non-systematic transactions. There is a risk that a material misstatement of the financial statements could be caused, or at least not be detected in a timely manner, by this shortage of qualified resources.
Deficiencies in Segregation of Duties.
The limited number of qualified accounting personnel results in an inability to have independent review and approval of financial accounting entries. Furthermore, management and financial accounting
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personnel have wide-spread access to create and post entries in our financial accounting system. There is a risk that a material misstatement of the financial statements could be caused, or at least not be detected in a timely manner, due to insufficient segregation of duties.
Because of its inherent limitation, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Our financial accounting staff is actively attending and receiving training. Management is still determining additional measures to remediate deficiencies related to staffing.
(b)Changes in Internal Controls Over Financial Reporting
There were no changes that occurred during the period covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
PART II – OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
In June of 2015, a Plaintiff filed suit against the Company and its subsidiary, NABE. The filing claimed that the Company did not have the right to retain the $510,030 that was received and recognized as Other Income. The Company is currently defending the action and does not believe that the suit will result to an unfavorable outcome to the Company.
ITEM 1A. RISK FACTORS
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. OTHER INFORMATION
None.
ITEM 5. EXHIBITS
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The following documents are filed as a part of this report or are incorporated by reference to previous filings, if so indicated:
Exhibit No. | Description |
3.1 | |
3.2 | |
31.1 | |
31.2 | |
32.1 | |
32.2 |
*filed herewith
(1) Incorporated by reference to the Form S-1 registration statement filed on June 30, 2008.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
November 14, 2018
By:
INCOMING, INC.
/s/ R. Samuel Bell, Jr.
R. Samuel Bell, Jr., CEO and Chairman, Board of Directors
/s/ Eric Norris
Vice President, Finance (Principal Financial Officer)
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