TRANSACT ENERGY CORP - Annual Report: 2020 (Form 10-K)

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. [X] Yes [   ] No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files). [   ] Yes [X] No.

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

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

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

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report [   ]

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

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter. On June 30^th, 2020, the aggregate market value of the voting stock of Transact Energy Corp. held by non-affiliates of the registrant was $504,981.81.

Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of the latest practicable date: As of December 31, 2020, we had issued and outstanding 60,728,912 shares common stock, $.001 par value.

APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY

PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. [   ] Yes [   ] No

DOCUMENTS INCORPORATED BY REFERENCE

List hereunder the following documents if incorporated by reference and the Part of the Form 10-K (e.g., Part I, Part II, etc.) into which the document is incorporated: (1) Any annual report to security holders; (2) Any proxy or information statement; and (3) Any prospectus filed pursuant to Rule 424(b) or (c) under the Securities Act of 1933. The listed documents should be clearly described for identification purposes (e.g., annual report to security holders for fiscal year ended December 24, 1980). None

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PART I

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

The statements contained in this Annual Report on Form 10-K may not be historical facts and may be "forward-looking statements." Such forward-looking statements can be identified by, among other things, the use of forward-looking terminology such as "believes," "intends," "plan" "expects," "may," "will," "should," or "anticipates" or the negative thereof or other variations thereon or comparable terminology, and similar expressions are intended to identify forward-looking statements. We remind readers that forward-looking statements are merely predictions and therefore inherently subject to uncertainties and other factors and involve known and unknown risks that could cause the actual results, performance, levels of activity, or our achievements, or industry results, to be materially different from any future results, performance, levels of activity, or our achievements, or industry results, expressed or implied by such forward-looking statements. Such forward-looking statements appear in Item 1 - "Business" and Item 7 - "Management's Discussion and Analysis of Financial Condition and Results of Operations," as well as elsewhere in this Annual Report and include statements regarding the following: the expected development and potential benefits from our products to consumers, progress in our efforts to develop our facilities and our products and to achieve and maintain regulatory approvals, the potential market demand for our products, our expectations regarding our short- and long-term capital requirements, our outlook for the coming months and information with respect to any other plans and strategies for our business.

The factors discussed herein, including those risks described in Item 1, and expressed from time to time in our filings with the Securities and Exchange Commission could cause actual results and developments to be materially different from those expressed in or implied by such statements. The forward-looking statements are made only as of the date of this filing, and we undertake no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.

INTRODUCTION

Unless otherwise specified or required by context, as used in this annual report, the terms "we," "our," "us" and the "Company" refer collectively to (i) TransAct Energy Corp., a Nevada corporation ("TransAct").

The Company's current corporate structure results from the issuance of founding shares equal to nine million four hundred thousand (9,400,000), an initial public offering (IPO) of one million one hundred and two thousand shares (1,102,000) at twenty-five cents ($0.25), the acquisition of a technology asset of two million six hundred thousand shares (2,600,000) and forty-seven million six hundred and twenty-six thousand, nine-hundred and twelve (47,626,912) shares for operations (including consulting, management and debt settlement).

The Company was originally formed to manage energy related assets and has changed its scope to sustainable technology development. The Company incorporates new technologies to provide sustainable energy sources and products. It has now focused completely on an Industry 4.0 manufacturing facility producing commodities from municipal solid waste without emissions utilizing sustainable energy sources.

Our financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles (U.S. GAAP) by management.

In this annual report, unless otherwise specified, all dollar amounts are expressed in United States dollars and all references to "common shares" refer to the common shares in our capital stock.

Item 1. Business.

Our History and Business

Our business is to use sustainable technology to produce sustainable products. TransAct Energy Corp has transitioned from its original focus of developing raw energy resources to manufacturing using solid waste as an above ground resource/asset.

We formed TransAct Energy Corp. as a Nevada corporation on March 15, 2006. Although our business plan called for the securing and managing of any energy leasehold, the Company focused on securing producing and non-producing oil and gas leases in Alberta, Canada. On September 7, 2006, we acquired a one hundred percent (100%) interest in a Petroleum and Natural Gas Lease, from the province of Alberta, Canada for twelve thousand and fifty-one dollars ($12,051), the MedHat Project. We did not develop this resource. We looked to expand our holdings in Alberta through acquisitions and joint ventures for the following two years. We have since allowed this lease to lapse and moved away from this focus.

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In 2008, the Company was introduced to geothermal power projects in British Columbia, Canada. We worked with companies Aqua Terra Power and Aqua Terra Geothermal through the balance of 2009 on the two geothermal power projects in British Columbia. Other than lending Aqua Terra funds; no formal arrangement was entered pending them securing drill permits on the two projects. The licenses associated with these projects lapsed and were acquired by a different corporation. We entered discussions with this entity in the latter half of 2011 to form a Farm-in relationship. We have put these discussions on hold pending the completion of our first waste optimization plant although we are maintaining dialogue with its principals as it relates to utilizing Geothermal in the plants themselves.

TransAct in mid-2009 started introducing the concept of geothermal power to markets in Western and South Asia with the plan to enter joint venture relationships to develop geothermal power projects in these areas. To enter these markets as a power producer, the Company found it strategic to add the development of traditional carbon fueled power projects. After discussions with Spectrum Energy Project Investments (a UAE power company), we submitted applications to the Basra Investment Commission to develop/manage three natural gas power plants. These multi-billion-dollar projects came with long-term power purchase agreements (PPA) and sovereign guarantees and our application through Spectrum was shortlisted. We were unsuccessful in completing our acquisition of 50% of Spectrum and the initial offering lapsed.

On August 31, 2009, TransAct Energy completed and closed its initial public offering at twenty-five cents ($0.25) per share selling one million one hundred and two thousand shares (1,102,000) for a total capital raise of two-hundred and seventy-four thousand three hundred and ninety-eight dollars ($274,398 USD). Most of these funds were placed with Aqua Terra Power as convertible notes to secure and develop the four (4) geothermal licenses in British Columbia, Canada; the balance was used to pay the costs of the offering and a small amount went to working capital. The Company was approved for listing on the OTCBB in December 2009 and received the trading symbol “TEGY.”

Throughout 2010 we laid the groundwork for large power projects in South Europe, Asia and Africa; smaller projects for solar, waste to energy and hydrogen fuel cells specifically in India. We worked to secure markets for geothermal, new solar photo-voltaic, waste to energy and hydrogen fuel cell generators.

Joint development agreement negotiations took place in December 2010 clearing the way for Transact to enter one major project in South East Asia in 2011. The 2011 year was frustrated with the company’s inability to collect raised or earned funds into the company’s bank account. Thus projects, joint ventures and previous efforts were postponed or lost permanently. While we did maintain the company’s trading status, the year was taken up with collection efforts and supporting business relationships while in limbo. We did initiate discussions on new waste to energy technologies to leverage the work we had done previously in this sector.

The Company’s 2012 efforts were focused on building out a Waste Optimization division. We completed a Business Plan for this division and entered a Joint Development Agreement with the owners of a small scale, proprietary, zero emissions waste optimization plant (“ZEWOP_tm”) that had been operating a 20 tonne per day plant for two years. We reconnected with clients in India and Brazil for future waste optimization opportunities. From the second quarter, through to the end of 2012 we worked to raise the necessary funds to build a municipal scale plant (1000+ tonnes per day) in Scotland.

2013 continued as a building year for both the company and its Waste Optimization division. We completed the acquisition of the ZEWOP_tm technology from the Scottish Inventor and brought him on as a long-term member of our team. We successfully negotiated a relationship with the international firm Fichtner Consulting Engineers to complete the certification of our plants going forward. We identified suppliers of feedstock for the proposed United Kingdom plants, initiated the relationships for the uptake of any Synthetic Gas and Electricity(neither are part of our product mix now) in the United Kingdom and tentatively sourced the capital required for the first plant in the United Kingdom. Globally we negotiated the intent to build a plant in Mexico that includes the required equity and feedstock. In Brazil, we initiated a relationship to create a green energy fund to grow both the market in Brazil and the other strategic areas of South America. Initial talks have taken place with potential development partners for a few of the major Brazil markets pending the success of the Mexico plant.

Throughout 2014 TransAct worked to finalize the engineering review and agreements necessary to develop the first ZEWOP_tm in Puebla, Mexico. The plant under design is capable of processing 1320 metric tons per day of Municipal Solid Waste (“MSW”) and is estimated to cost approximately three hundred million dollars. In late November Fichtner Consulting Engineers reported they believed the ZEWOP_tm could process the MSW 100% into useable products without emissions. The Fichtner report provided TransAct the opportunity to submit the Waste Supply Agreement to the Municipality of Puebla, prepare off-take agreements for interested buyers of the ZEWOP_tm products and formalize the share purchase agreement with the Puebla Waste Consortium (“PWC”). PWC intended on providing 30% of the capital required to build the ZEWOP_tm, while TransAct negotiates third party lenders for the remaining 70% of the cost through debt instruments.

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The Company delivered the results of the Fichtner Report to the Puebla City Staff in December of 2014. The cost of the plant was more than originally discussed because it included MSW pre-processing and dewatering component. This affected the required equity and although it was never stated, appears to be cause of the PWC hesitation. We also found out subsequently that there was legal wrangling and back room negotiations between the existing MSW concession holders and the municipal/state government, affecting their ability to sign with us. After 6 months with no movement forward for the MSW feedstock from the City of Puebla, Management set out in 2015 to secure an alternate source of MSW. The agreement we had with the Puebla Waste Consortium was terminated, however, the sales efforts were all to National/International companies whose interest in our products will not change with a change in location.

Because of the specialized nature of many of the ZEWOP_tm components, we initiated some of the equipment procurement; thus, we entered a design/supply agreement for our proprietary reactors with a specialized engineering firm.

2014 saw the Company form subsidiary corporations in Ireland and Mexico. In Ireland we established the wholly owned subsidiary “TransAct Energy Global Limited”, this company will in turn wholly own each national subsidiary. The first national subsidiary of TransAct Global is “TransAct Energy Mexico S.DE R.L. DE C.V.” which will own a majority shareholding of each holding company that owns a ZEWOP_tm like the Mexican corporation “Puebla ZEWOP 1, S. DE R.L. DE C.V.”.

At the beginning of 2015 we focused on finalizing the sale of the anticipated ZEWOP_tm products. These efforts included getting signed letters of intent from qualified buyers and preparing formal legal agreements for the same. We now have letters of intent from multiple qualified buyers for all the expected product and agreements ready to be signed subject to us finalizing our feed-stock agreement (Waste Supply Agreement) for the first plant.

In summary 2015’s efforts focused on completing the due-diligence for the Mexican candidate feedstocks including matching equity partners and buyers of the resulting products. To that end, we now have several feedstock agreements to negotiate through to a final agreement or dismiss depending on the outcome of the negotiations. The potential equity partners have been identified subject to finalizing the feedstock agreement and pre-sales of the future products. The clients that signed letters of intent for the products have also been briefed on the potential feedstock cities to confirm their commitment. Every effort was made during the year to keep the candidate banks for debt financing informed of our progress and they appear to be continuing with their support.

2016 we focused on finalizing contracts for the required MSW feedstock. The results were a signed memorandum of understanding (MOU) with a private contractor in Mexico City and a municipality outside of Asuncion, Paraguay; a letter of invitation from the Republic of Panama; and a formal proposal to a municipality in the State of Jalisco, Mexico now awaiting the formal request for proposal coming in 2017. The Mexico City MOU was followed in December 2016 with a Waste Supply Agreement. Each opportunity was negotiated to satisfy our need for thirteen-hundred and twenty metric tons per day of MSW feedstock per ZEWOP_tm.

2017 was Transacts breakthrough year as it finally secured the required feedstock under long-term contract for its first ZEWOP_tm to be in Mexico’s second largest city Guadalajara. We immediately secured a strategically located industrial site in El Salto and have proceeded to pre-sell the products from the future ZEWOP_tm.

In 2018 we focused on completing the due diligence for the El Salto site, the pre-development capital required to pay for the building-site and the completion of all preliminary design work required to secure an EPC Contractor (Engineering, Procurement and Construction) through the tender process to build the ZEWOP_tm. Due diligence was completed proving the site suitable for our proposed use and the landowners have so far continued to wait for us to close on the site.

The pre-development capital was committed to as a bridge-loan, but to date has not been received.

Plant is estimated at 31,355 sq. meters. Using approximately 7.2 hectares.

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2019 was dominated with closing the funds to build the El Salto ZEWOP_tm and preparing the Company for operating status. This included continued meetings with members of the new Mexican government to forward our waste management approach in Mexico and renegotiating the purchase of the El Salto lands anticipating a closing. We started the process of acquiring a sustainable geothermal technology that will provide most of the energy required to operate the ZEWOP_tm. Our incoming COO and CPO started working through the people requirements for Mexico.

We acquired another Irish corporation to hold our physical assets in Ireland as we start the search for facilities to house our global accounting, human resources, and research/development offices in Dublin. To that end Christina Kenny officially came on as our Chief People Officer starting the process of identifying our first hires for both the global administration and the El Salto ZEWOP_tm.

2020 had two focuses: We continued raising the predevelopment capital for El Salto, Mexico and new business development initiatives that could result in cash flow. Raising the pre-development capital for El Salto during COVID-19 Pandemic led to the loss of several funders, however, as companies adjusted it created new opportunities. We reduced our initial capital requirements by $10 Million through negotiating a lease/purchase agreement on the El Salto lands. Then after many single-family office contacts we negotiated the balance of the funds required. We have secured a $14 Million loan with an office that owns an EPC Contractor and we have agreed to their preferred vendor status, provided they are competitive through the tender process. In terms of business development, we contracted to develop a retail business using our core reactor technology. The retail opportunity is now in the business planning stage.

Business Strategy

It is our intent during the eighteen-months that it should take to construct the first municipal scale ZEWOP_tm; to debug any mechanical/operational issues of the design. After the first building is complete (approximately one-year in), we will secure the second site in Guadalajara and start its construction as soon as the first plant is certified operational. We will complete the assembly of the second ZEWOP_tm to perfect the project management process, creating a cookie cutter approach to ZEWOP_tm erection.

The first two ZEWOP_tm gives us the opportunity to recruit and train the project managers’ expertise to effectively work with our EPC contractors in the development of each new ZEWOP_tm; with a focusing on streamlining the supply chain of required materials and equipment.

With a firm start date and location of the first ZEWOP_tm TransAct Energy Mexico can proceed to finalize long-term offtake agreements. We will reengage Fichtner Consulting Engineers to prepare working drawings, that while being approved under permits and permissions will go to tender for a guaranteed procurement and construction contract (EPC). We have selected a preferred vendor for this role, however, they still have to compete in the EPC tender process. When these steps are completed, we intend on finalizing the tentative financing commitments we have in place with two international investment banks.

TransAct intends on establishing the manufacturing of our proprietary reactors in Mexico in 2021. We have already initiated discussions for a joint venture agreement with an ISO 9001 and ASME capable manufacturer. Our facility would supply the demand for both Mexico, South America, Central America, Canada and the USA.

ZEWOP_tm can demonstrate to Mexico and the World a municipal scale solution to manufacturing using solid waste without emissions. Although we have been approached to build in other North American cities, we feel the market is best approached when the first ZEWOP_tm is fully operational to garner government agency support. Once we break ground, we will make sure major municipalities throughout the US and Canada are aware of our process, so we get on their technology review lists. This will ensure a smoother entry into North American markets,

Until the first revenues from operations come in, our corporate operations will continue to be funded by raising money through private placements or public offerings. We anticipate bringing on an expanded management team to oversee our operational growth throughout the upcoming year and plan to raise additional capital as required.

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Markets and Customers

The markets that need to adopt a circular economy strategy, the complete processing of solid waste into useable products/commodities without emissions or landfilling are global. Countries around the world are adopting standards that will reduce green house gas emissions. They are promoting better use of resources, ultimately seeking freedom from new resource harvesting including foreign petroleum. The TransAct ZEWOP_tm provides these markets with an emissions free solution utilizing their solid waste and turning it into products and fuels that can be used in these domestic markets.

We have had discussions and early contract negotiations with entities in Argentina, Brazil, Canada, China, Europe, Mexico and USA. Europe is the most advanced market with legislation in place that targets zero-landfills and zero-emissions within a few short years. The current ZEWOP_tm design for mass production has a plant size processing capacity of approximately 1320 tonnes per day of raw municipal solid waste (based on 2 Kgs per day per person, approximately 660,000 people in North America slightly less in Europe).

Our target service customers are corporations or municipalities with municipal solid waste, plastic, tires or medical waste as these are the most profitable waste streams. However, we can process any carbon based waste stream including sewage and agricultural.

Our target ZEWOP_tm product customers include airlines, shipping companies, bus companies, trucking companies or fuel retailers requiring direct blend green fuels to meet legislated targets. The EU 20/20 legislation started on January 1^st of 2015, requires a 20% green fuel blend by 2020. This has created customers needing a green fuel that can blend with existing refined fuels.

Since 2015, all airplanes or ships landing in the EU require 15% of their fuel to be green. We anticipate these sectors will adopt our fuels in this capacity upon EU certification. Our customers also include friction product manufacturers (brake pads, clutch plates, sanding disks) and wood product manufacturers (plywood, particle board, OSB etc.) that utilize phenol resins in their manufacturing process. We are targeting manufacturers of biodegradable plastics and pharmaceuticals for our Levoglucosan and tire and rubber manufacturers, lithographers and printers for our high quality carbon black. Waxes for the cosmetic industry, paraffin waxes for a variety of other uses including candles, along with high grade lubricating oils are ZEWOP^tm products. We produce fertilizers for the agricultural industry, a brick mix for the construction industry, a variety of reclaimed metals, and purified (distilled) water. Acetic acid and furfural are manufactured for industrial chemical manufacturers. We have a diverse mix of products and potential customers.

As at December 31, 2020, the Company has a combined CEO/CFO and the Chief People Officer. The Company has identified persons for many of its required portfolios and intends to finalize employee agreements in March 2021. The focus will be on growing the human resource, development, accounting, and sales teams first and then filling out the rest as we progress towards operations.

Our global offices covering human resources, accounting, research, and development will be based in Dublin, Ireland and will be staffed accordingly starting in the first quarter of 2021.

As the company ramps up the ZEWOP_tm in Mexico, it anticipates bringing on 50 to 75 employees in its Mexican subsidiary.

The Company did not experience any labour disputes or labour stoppages during the current fiscal year.

Principal Products

The Company’s principal products are carbon black, phenol resins and Levoglucosan making up approximately 71% of our proposed revenue. Waxes account for another 15%.

Sources and Availability of Raw Materials

The raw material for the ZEWOP^tm is solid waste; better known as trash or garbage. Humanity currently produces over 11 Billion tonnes of waste per year. Just over 2 Billion tonnes is processed by use of landfills or incineration technologies; while the rest is dumped raw onto land/oceans. Garbage is readily available in every municipality on our planet.

Seasonality of Business

Waste from human activities is generated 365 days a year with slight seasonal variations occurring in MSW. Our facilities are designed to run every day of the year. The products we produce are in demand globally and used year round.

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Industry Practices/Needs for Working Capital

The Company is heavily involved in development operations; therefore high levels of working capital will be committed directly or indirectly to the construction efforts. After a ZEWOP_tm becomes commercially operational, the needs of working capital are expected to be low. The Company is expecting to be significantly involved in development activities for the next 20 years.

Dependence on Few Customers

The market for our products is vast. However, the number of entities that can physically, logistically and economically purchase large quantities of the commodity in our area of operations are limited. The Company’s primary revenues are projected to originate from carbon black (21 %+) and phenol resin (38 %+) sales. Currently, the Company has interest from three multi-national corporations for these and other ZEWOP^tm products. Mitigating risk factors with customers will focus on their credit-worthiness, a guaranteed long-term contract with no out, unless we do not perform. We can also build up a multitude of small order customers over time.

Competitive Conditions

The interest in both sustainable energy, manufacturing, and the waste to value sector have continued to grow as have the amounts of garbage. Every government on the planet is faced with growing amounts of solid waste and the mandate to use it as a resource rather than bury or burn it. The demand for sustainable energy continues to increase almost everywhere on the planet at the same time. Climate changes affect the demand for heating and cooling and the lack of rain in certain areas impacts on the ability to produce hydro-electricity. Political instability or the threat there of, in oil producing regions sends countries that have petroleum based economies scrambling for alternatives. Economic instability impacts on many countries abilities to import energy; causing them to look within their own borders for energy that provides autonomy. The pressure is on all nations to look at and change the environmental impact of their solid waste.

Each product we produce is made by reprocessing solid waste, resulting in“green” and cheaper products. Our production process has no emissions or environmental impact compared to competitive products that come from crude oil and natural gas. Because our raw material is garbage, we are not subjected to market fluctuations and can consistently maintain our cost of goods compared to our competitors. The finished products are produced at much lower costs than our competitors giving us a natural advantage going forward.

Any technology that can produce clean energy from waste in a cost effective manner has a competitive advantage in the complex matrix of sustainable energy production. To date, there have been no emission free and cost effective energy from waste technologies to handle the ever growing waste on our planet. Governments have settled for incineration with scrubbers that remove the pollutants to established levels. The new emission targets being established for waste going forward, limits the competition.

Availability of resources, upfront capital and customers willing to pay for the resulting products, determine the generation resource. The markets where they have resources but not the expertise or upfront capital, opens the competitive field for those able to build, own, and operate profitable facilities over the long-term.

The Company believes that our emission free technology, low operating costs and ability to process all waste streams into useable products with full carbon capture and a low "full life" cost will allow it to successfully compete for long-term waste processing and green product supply agreements globally.

Factors that can influence the overall market for our products include some of the following:

·number of market participants buying and selling green products including fuels; 

·environmental regulations that impact us and our competitors; 

·availability of production tax credits and other benefits allowed by tax law; 

·relative ease or difficulty of developing and constructing new facilities; and 

·credit worthiness and risk associated with buyers. 

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Environmental Compliance

The TransAct ZEWOP_tm was designed and meets the European Union Environmental Protection Agency emission free standards. The plants do not incinerate so there are no flue gases and no ash. All waste delivered to the plant is converted to useable products.

The incoming waste is maintained indoors and under cover at three-day processing levels, to avoid any possible nuisance.

The storage systems for liquids produced on site pending shipment; meet or exceed regional standards for safety and environmental impact.

All known environmental issues in the ZEWOP_tm have been identified and solutions obtained that will mitigate these issues beyond established compliance.

Available Information

We will be making available in the near term, through our Internet website at http://www.transactenergycorp.com, our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as soon as reasonably practicable after such material is electronically filed with or furnished to the SEC. Information on our website is not incorporated into this report and is not a part of this report.

All material press releases are disseminated through a North America wide news wire service, published on our website, LinkedIn and twitter (transactenergycorp@transactenergyc).

Governmental Regulation

Although we intend to comply with all applicable laws and regulations, we cannot assure you that we are in compliance or that we will be able to comply with all future laws and regulations. Additional national or regional legislation, or changes in regulatory implementation, may limit our activities in the future or significantly increase the cost of regulatory compliance. If we fail to comply with applicable laws and regulations, criminal sanctions or civil remedies, including fines, injunctions, or seizures, could be imposed on us. This could have a material adverse effect on our operations.

The business of industrial plant development and operation is subject to substantial regulation under governmental laws relating to the development, upgrading, marketing, pricing, taxation, and distribution of our products and other matters. Amendments to current laws and regulations governing development and operations of industrial plants could have a material adverse impact on our business. In addition, there can be no assurance that income tax laws, royalty regulations and government incentive programs related to our industry generally, will not be changed in a manner which may adversely affect our progress and cause delays, inability to develop or abandonment of these interests.

Permits, leases, licenses, and approvals are required from a variety of regulatory authorities at various stages of development and operation of industrial projects. There can be no assurance that the various government permits, leases, licenses and approvals sought will be granted in respect of our activities or, if granted, will not be cancelled or will be renewed upon expiry. There is no assurance that such permits, leases, licenses, and approvals will not contain terms and provisions which may adversely affect our development and operating activities.

The development and operations of our proposed projects are or will be subject to stringent federal, state, provincial and local laws and regulations relating to improving or maintaining environmental quality. Environmental laws often require parties to pay for remedial action or to pay damages regardless of fault. Environmental laws also often impose liability with respect to divested or terminated operations, even if the operations were terminated or divested many years ago.

The development activities and operating programs on our proposed and future projects are or will be subject to extensive laws and regulations governing, development, production, imports, taxes, labor standards, occupational health, waste disposal, protection and remediation of the environment, protection of endangered and protected species, plant safety, toxic substances and other matters. Power development and operations are also subject to risks and liabilities associated with pollution of the environment and disposal of waste products. Compliance with these laws and regulations will impose substantial costs on us and will subject us to significant potential liabilities.

Our business is subject to various federal, provincial, state and local laws and governmental regulations that may be changed from time to time in response to economic or political conditions. TransAct Energy Corp. in each jurisdiction is subject to regulation in respect of the production, sale and distribution of energy in the form of fuel or electricity.

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For project development TransAct will hire consulting and engineering services for site development, design, air quality, cooling water reuse, permitting, environmental engineering and regulatory compliance.

Environmental Credits

As a future “green” product producer, environmental-related credits, such as renewable energy credits or carbon credits, may become available for sale to power companies (to allow them to meet their “green” power requirements) or to businesses which produce carbon based pollution. If available, these credits will belong exclusively to us or our joint venture and may provide an additional source of revenue.

Item 1A. Risk Factors.

General Business Risks 

We are a new business with limited operating history and making an investment in TransAct is risky. If we are unable to successfully identify and secure waste optimization projects, then we will not be successful as a business. It will be difficult for you to evaluate an investment in our stock since our operating history is limited to developing our business plan, and bidding on multiple waste-optimization projects globally. As a young Company, we are especially vulnerable to any problems, delays, expenses and difficulties we may encounter while implementing our business plan. We have not proven the essential elements of profitable operations, and you will bear the risk of complete loss of your investment if we are not successful.

Our future performance may depend on our ability to establish that a particular energy technology is economically sustainable. Sustainable manufacturing technology development and operations involve a high degree of risk. The execution of our business plan is generally, dependent upon the existence of economically usable solid waste and the sale of our proposed product matrix. Expansion of the production of products from our technology is not certain and depends on successful production in quantities and containing enough marketable quality economically for future plants.

We have a need for substantial additional financing and will have to significantly delay, curtail or cease operations if we are unable to secure such financing. The Company requires substantial additional financing to fund the cost of acquiring and developing ZEWOP_tm. The Company also requires funds for other operating activities, and to finance the growth of our business, including the construction and commissioning of ZEWOP_tm. We may not be able to obtain the needed funds on terms acceptable to us or at all. Further, if additional funds are raised by issuing equity securities, significant dilution to our current shareholders may occur and new investors may get rights that are preferential to current shareholders. Alternatively, we may have to bring in joint venture partners to fund further development work, which would result in reducing our interests in the projects.

We may be unable to obtain the financing we need to pursue our growth strategy for ZEWOP_tm, which may adversely affect our ability to expand our operations. When we identify a manufacturing project that we may seek to acquire or to develop, a substantial capital investment will be required. Our continued access to capital, through project financing or through a partnership or other arrangements with acceptable terms, is necessary for the success of our growth strategy. Our attempts to secure the necessary capital may not be successful on favorable terms, or at all.

Market conditions and other factors may not permit future project and acquisition financings on terms favorable to us. Our ability to arrange for financing on favorable terms, and the costs of such financing, are dependent on numerous factors, including general economic and capital market conditions, investor confidence, the continued success of current projects, the credit quality of the projects being financed, the political situation in the jurisdiction in which the project is located and the continued existence of tax laws which are conducive to raising capital. If we are unable to secure capital through partnership or other arrangements, we may have to finance the projects using equity financing which will have a dilutive effect on our common stock. Also, in the absence of favorable financing or other capital options, we may decide not to build new plants or acquire facilities from third parties. Any of these alternatives could have a material adverse effect on our growth prospects and financial condition.

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We may be unable to realize our strategy of utilizing the tax and other incentives available for developing ZEWOP_tm to attract strategic alliance partners, which may adversely affect our ability to complete these projects. Part of our business strategy is to utilize tax and other incentives available to developers of ZEWOP_tm to attract strategic alliance partners with the capital sufficient to complete these projects. Many of the incentives available for these projects are new and highly complex. There can be no assurance that we will be successful in structuring agreements that are attractive to potential strategic alliance partners. If we are unable to do so, we may be unable to complete the development of our energy projects and our business could be harmed.

If we incur material debt to fund our business, we could face significant risks associated with such debt levels. We will need to procure significant additional financing to construct, commission and operate our plants in order to generate and sell products. If this financing includes the issuance of material amounts of debt, this would expose the Company to risks including, among others, the following:

·a portion of our cash flow from operations would be used for the payment of principal and interest on such indebtedness and would not be available for financing capital expenditures or other purposes; 

·a significant level of indebtedness and the covenants governing such indebtedness could limit our flexibility in planning for, or reacting to, changes in our business because certain activities or financing options may be limited or prohibited under the terms of agreements relating to such indebtedness; 

·a significant level of indebtedness may make us more vulnerable to defaults by the purchasers of our products or in the event of a downturn in our business because of fixed debt service obligations; and 

·the terms of agreements may require us to make interest and principal payments and to remain in compliance with stated financial covenants and ratios. If the requirements of such agreements were not satisfied, the lenders could be entitled to accelerate the payment of all outstanding indebtedness and foreclose on the collateral securing payment of that indebtedness, which would likely include our interest in the project. 

In such event, we cannot assure you that we would have sufficient funds available or could obtain the financing required to meet our obligations, including the repayment of outstanding principal and interest on such indebtedness.

We may not be able to successfully integrate companies that we may acquire in the future, which could materially and adversely affect our business, financial condition, future results and cash flow. Our strategy is to continue to expand in the future, including through acquisitions. Integrating acquisitions is often costly, and we may not be able to successfully integrate our acquired companies with our existing operations without substantial costs, delays or other adverse operational or financial consequences. Integrating our acquired companies involves a number of risks that could materially and adversely affect our business, including:

·inability to retain key personnel of the acquired companies; 

·risks associated with unanticipated events or liabilities; and 

·the difficulty of establishing and maintaining uniform standards, controls, procedures and policies, including accounting controls and procedures. 

If any of our acquired companies suffer performance problems, the same could adversely affect the reputation of our group of companies and could materially and adversely affect our business, financial condition, future results and cash flow.

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The success of our business relies on retaining our key personnel. We are dependent upon the services of our President and Chief Executive Officer, Roderick C. Bartlett, our Chief Financial Officer, Rod Bartlett, our Director and future COO Joe F. Dickson our Director and future CPO, Christina Kenny, our Director and Finance person Karie Elsasser, our Director and CMO, Tina Vanderheyden, our CSO, Doug Scott. The loss of any of their services could have a material adverse effect upon us. As of the date of this report, the Company has negotiated compensation agreements with some of these persons but does not hold key-man insurance on any of them.

Environmental assessments of proposed projects carry a heightened degree of responsibility for companies and directors, officers and employees. The cost of compliance with changes in governmental regulations has a potential to reduce the profitability of operations.

·leakage of fluids or airborne pollutants from gathering systems, pipelines, plant and storage tanks; 

·damage resulting from accidents during normal operations; and 

·explosions. 

Because the requirements imposed by such laws and regulations are frequently changed, we cannot assure you that laws and regulations enacted in the future, including changes to existing laws and regulations, will not adversely affect our business by increasing cost and the time required to explore and develop geothermal projects.

Industry competition may impede our growth and ability to enter into energy purchase agreements on terms favorable to us, or at all, which would negatively impact our revenue. The waste management industry is highly competitive, petroleum product industry is highly volatile, and we may not be able to compete successfully or grow our business. We compete in areas of pricing, access and markets. The industry in many jurisdictions is complex as it is composed of public service districts, cooperatives and investor-owned waste to energy companies. Many of the participants produce and distribute electricity and fuels. Their willingness to purchase petroleum or fuel from an independent producer may be based on several factors and not solely on pricing and surety of supply. If we cannot enter into offtake agreements on terms favorable to us, or at all, it would negatively impact our revenue and our decisions regarding development of additional plants.

There are some risks for which we do not or cannot carry insurance. Because our current operations are limited in scope, the Company carries property and, public liability insurance coverage as needed, but does not currently insure against any other risks.

Our officers and directors may have conflicts of interests arising out of their relationships with other companies. Several of our directors and officers serve (or may agree to serve) as directors or officers of other companies or have significant shareholdings in other companies. To the extent that such other companies may participate in ventures in which the Company may participate, the directors may have a conflict of interest in negotiating and concluding terms respecting the extent of such participation. From time to time, several companies may participate in the acquisition and development of properties thereby allowing for their participation in larger programs, permitting involvement in a greater number of programs and reducing financial exposure in respect of any one program. It may also occur that a particular company will assign all or a portion of its interest in a particular program to another of these companies due to the financial position of the company making the assignment.

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Risks Relating To the Market for Our Securities

A significant number of shares of our common stock are eligible for public resale. If a significant number of shares are resold on the public market, the share price could be reduced and could adversely affect our ability to raise needed capital. The market price for our common stock could decrease significantly and our ability to raise capital through the issuance of additional equity could be adversely affected by the availability and resale of such a large number of shares in a short period of time. If we cannot raise additional capital on terms favorable to us, or at all, it may delay our exploration or development of existing properties or limit our ability to acquire new properties, which would be detrimental to our business.

The price of our common stock is volatile, which may cause investment losses for our shareholders. The market for our common stock although newly initiated is assumed to be highly volatile. The trading price of our common stock on the OTCBB is subject to wide fluctuations in response to, among other things, quarterly variations in operating and financial results, and general economic and market conditions. In addition, statements or changes in opinions, ratings, or earnings estimates made by brokerage firms or industry analysts relating to our market or relating to our Company could result in an immediate and adverse effect on the market price of our common stock. The highly volatile nature of our stock price may cause investment losses for our shareholders.

We do not intend to pay any cash dividends in the foreseeable future. We intend to reinvest any earnings in the development of our projects. Payments of future dividends, if any, will be at the discretion of our board of directors after taking into account various factors, including our business, operating results and financial condition, current and anticipated cash.

Our stock is subject to the Penny Stock rules, which impose significant restrictions on broker-dealers and may affect the resale of our stock. A penny stock is generally a stock that:

·is not listed on a national securities exchange or NASDAQ, 

·is listed in the "pink sheets" or on the NASD OTC Bulletin Board, 

·has a price per share of less than $5.00 and 

·is issued by a company with net tangible assets less than $5 million. 

The penny stock trading rules impose additional duties and responsibilities upon broker-dealers and salespersons effecting purchase and sale transactions in common stock and other equity securities, including:

·determination of the purchaser's investment suitability, 

·delivery of certain information and disclosures to the purchaser, and 

·receipt of a specific purchase agreement before effecting the purchase transaction. 

Many broker-dealers will not effect transactions in penny stocks, except on an unsolicited basis, in order to avoid compliance with the penny stock trading rules. In the event our common stock becomes subject to the penny stock trading rules,

·such rules may materially limit or restrict the ability to resell our common stock, and 

·the liquidity typically associated with other publicly traded equity securities may not exist. 

Because of the significant restrictions on trading penny stocks, a public market may never emerge for our securities. If this happens, you may never be able to publicly sell your shares.

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Item 2. Properties.

Our principal mailing address is 1225 E Sunset Dr, STE 145 – 367 Bellingham, WA 98226 United States. Our telephone number is 210-888-0785.

Item 3. Legal Proceedings.

Our Company is not a party to any bankruptcy, receivership or other legal proceeding.

Item 4. Submission of Matters to a Vote of Security Holders.

None.

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PART II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

The Company first traded on February 24, 2010 on the Over-The-Counter Bulletin Board (the “OTCBB”) under the trading symbol “TEGY”. Future trading prices of our common shares will depend on many factors, including, among others, our operating results and the market for similar securities.

As of December 31st, 2020, there are 93 active shareholders of record holding 47,554,537 restricted shares of the Company’s common stock and 13,174,375 unrestricted shares eligible for trading of which 9,553,143 are considered active shares. The total issued and outstanding is 60,728,912 shares of common stock. The holders of common stock are entitled to one vote for each share held of record on all matters submitted to a vote of stockholders. Holders of the common stock have no pre-emptive rights and no right to convert their common stock into any other securities. There are no redemption or sinking fund provisions applicable to the common stock.

We have not paid, nor declared, any dividends since our inception and do not intend to declare any such dividends in the foreseeable future. Our ability to pay dividends is subject to limitations imposed by Nevada law. Under Nevada law, dividends may be paid to the extent that a corporation’s assets exceed its liabilities and it is able to pay its debts as they become due in the usual course of business.

Item 6. Selected Financial Data.

Not Applicable.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The root of our business is manufacturing, turning solid waste into an above ground asset, in other words all that wood, oil, aluminium, copper, iron, cotton and other materials harvested from the planet that we use in consumer items and then throw away when we are done with it can be put back into the economy using automation, robotics, AI, IoT combined with sophisticated hardware, chemical and mechanical knowhow. Our business will do this utilizing advanced sources of sustainable energy, so each plant is autonomous and becomes completely emissions free exemplifying sustainable industry. This is a big undertaking for a start up which is what we are even after existing for fourteen years. Our management discussion and analysis will reflect the capital struggle we have had to get to the point we are now.

We initially transitioned to a sustainability focus in 2008, it took us another 5 years to acquire and settle into our manufacturing role which is discussed in our history. The total focus now of TransAct Energy’s business resources over the past 6 years has been bringing a municipal scale (1000 tonnes of municipal solid waste per day or greater) zero-emissions waste optimization plant to market. This involved bringing credibility to the concept and design by engaging third party verification from a globally recognized engineering firms so that the controllers of the waste and financiers of industry would at least give us an audience.

Over the last few years we have been able to secure the components required to bring to fruition the all important first ZEWOP_tm, the feedstock (1320 metric tons per day of MSW under a long-term contract), a suitable site (industrial land at least 7 hectares in size, with applicable zoning and no ground contamination), pre-sales of our products (getting commitments out of credible end users) and financing commitments for the complete project. What we have not been able to do yet is get the pre-development capital approximately $20 Million required to satisfy the long-term money, that requires we have a guaranteed EPC contract and the offtake agreements in place. This requires we secure the land, obtain working drawings for tendering the EPC contract, award the EPC and then based on that timeline finalize the offtakes. To obtain the $20 Million, we must constantly find and communicate with potential sources of this money (private funds, hedge funds, venture funds, institutions).

To fund our development stage process, we have raised our operating capital through short-term loans and convertible notes as previously discussed and we will have to continue this practice until we raise the next $24 Million. Over the 14 years we have existed we have accumulated a $12.8 Million deficit, almost half of this can be accounted for in $6.1 Million of interest on less than $400K in what were supposed to be short term loans. The interest associated with these loans was negotiated based on a quick repayment that did not occur. We continue to accrue the interest on its original terms until we can negotiate/repay the same. A large portion of the balance of the deficit can be attributed to compensation whether consultants or employees and will escalate from this point forward as we must enlarge the team as we get closer to completing the predevelopment capital raise. Up to this point we have $3. Million in compensation outstanding. Of the deficit $3.4 Million has been raised through the company’s common stock over the past ten years the balance sits as outstanding liabilities primarily the interest and compensation accrual.

The incorporations and the pre-development work are reflected on our balance sheet under current assets and other non-current assets. The engineering, accounting and legal works resulted in some additional accounts payable.

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Financing efforts for the ZEWOP_tm in, Mexico although progressing have not resulted in material contracts and as such did not impact on our financial results other than as discussed herein. Market development efforts will not be material and reflected in our financial statements until bona fide’ agreements are monetized. The loan agreement for $14 Million entered into on Dec 31, 2020, will not be recorded until received.

Plan of Operation

For the 2021 year the Company’s focus is to:

1.Having secured working capital under contract the Company upon receipt in February intends to maintain its accounts payable as current, fund day to day corporate costs through to cash-flow, establish our Global Human Resource, Accounting, Research and Development Center in Ireland, including establishing our corporate management team to facilitate items 3) a. through 3) g which meets the requirements for the balance of our tentative funding commitments. 

2.Complete the development of the ZEWOP^tm in El Salto (Guadalajara), Mexico as follows. 

a.Complete lease/purchase of lands. 

b.Secure C-suite executives and Mexico support team. 

c.Meet all corporate compliance. 

d.Finalize Product Off-take Agreements. 

e.Complete working drawings for El Salto ZEWOPtm. 

f.Secure all required permits and permissions. 

g.Complete EPC contracts and supplier agreements. 

h.Site development, construction, and assembly of plant. 

3.Finalize second Mexico ZEWOPtm contracts to launch development in 2022. 

4.Continue with European market entrance towards end of 2022. 

Results of Operations.

Period from January 1, 2020 to December 31, 2020

We generated no revenue from January 1, 2020 to December 31, 2020. For the year ended December 31, 2020 our general administrative expenses were $ 284,056. Currently our general administrative expenses consist primarily of compensation (127%) offset by an expense recovery in legal (31.27%). During 2020 we recorded interest expense of $1,571,015 because of notes payable. Thus, we have reported a net loss of $1,855,071 for the period ended December 31, 2020. Our total net loss from inception on March 15, 2006 through December 31, 2020 was $12,853,876.

Stock-Based Compensation Costs

Stock-based compensation represents 22% of the Company’s operating expenses for the fiscal year ended December 31, 2020. The stocks are a part of our annual executive compensation plan, and are issued to obtain, retain and motivate our directors, executives and employees.

Liquidity and Capital Resources

At December 31, 2020, we had total assets of $544,859. Our Current assets are $402,356. We have software at $126 and computers are $26. Current liabilities at December 31, 2020 totaled $10,006,993 they consisted of accounts payable in the amount of $346,035, accrued interest of $6,159,952, compensation payable in the amount of $3,112,396, notes payable net in the amount of $388,610.

We filed a registration statement on Form S-1 with the Securities and Exchange Commission to register up to 2,000,000 shares of common stock for sale at a price of $.25 per share for a total of up to $500,000. The registration statement was declared effective on December 12, 2008. We exceeded the minimum of our offering of $250,000 on or before August 31, 2009 and subsequently closed the offering. We issued a total of 1,102,000 shares under our offering of $0.25 per share to raise a total of $274,398. The funds were used as per the prospectus to cover the offering costs and to secure additional business for our operations.

The Company has relied on short term notes (12 months or less) with a conversion to common stock provision and offshore restricted stock sales to fund its corporate activities over the past year. This has resulted in more shareholders which creates the potential for greater liquidity going forward however it also provides greater dilution of individual holdings.

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The Company has limited capability without significant assets or earnings to raise debt. The development of ZEWOP_tm the core business of the Company will rely on debt markets. To attract this capital, the Company will have to secure long term waste supply contracts and long term product sales contracts both from high credit worthy entities. The Company must agree to encumber the assets associated with each ZEWOP_tm and all net revenue until the debt is retired. This arrangement will restrict the Company’s ability to pay dividends to its shareholders.

Potential Acquisitions

We anticipate acquiring a 19-hectare industrial site in the Greater Guadalajara, Mexico area this year. Going forward we may be required to acquire existing waste supply agreements in order to operate in some cities. We may also elect to acquire some of the technologies we intend on using in order to further protect the intellectual property of our ZEWOP_tm.

Critical Accounting Policies

The discussion and analysis of our financial condition and results of operations are based upon the financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. Certain accounting policies involve judgments and uncertainties to such an extent that there is reasonable likelihood that materially different amounts could have been reported under different conditions, or if different assumptions had been made. We evaluate our estimates and assumptions on a regular basis. We base our estimates on historical experience and various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for the financial statements.

Cash and Cash Equivalents

The Company considers cash deposits and highly liquid investments to be cash and cash equivalents for financial reporting presentation on the balance sheet and statement of cash flows. The Company subscribes to the accounting standards that define cash equivalents as highly liquid, short-term instruments that are readily convertible to known amounts of cash, which are generally defined investments that have original maturity dates of less than three months.

Contractual Obligations

We have or will have material commitments for the next twelve months that include supporting professionals (including engineers, accountants, lawyers and auditors) and the management compensation agreements. We will require additional capital to meet our liquidity needs. As a result, our independent auditors have expressed substantial doubt about our ability to continue as a going concern. In the past, we have relied on capital contributions from shareholders to supplement operating capital when necessary. We anticipate that we will receive sufficient contributions from shareholders to continue operations for at least the next twelve months. However, there are no agreements or understandings to this effect. We may sell common stock, take loans from officers, directors or shareholders or enter into debt financing agreements.

Need for Additional Financing

We estimate our upcoming operating expenses to increase substantially as we transcend from development stage to operating stage and maybe as much as $24,000,000.00 this year. We do not have any commitments for capital expenditures however we do anticipate entering into commitments to secure acquisitions. We believe we will need additional funds to cover our expenses and acquisitions for the next twelve months. Our need for capital may change dramatically as we pursue our business plan during that period. At present, we have no material understandings, commitments or agreements with respect to the acquisition of any business venture or capital commitments. Further, we cannot assure that we will be successful in consummating business opportunities on favourable terms or we will be able to profitably manage any business opportunities. Should we require additional capital, we may seek additional advances from officers, sell common stock or find other forms of debt financing.

Off Balance Sheet Arrangements

As of December 31, 2020, the Company had one off-balance sheet arrangements, in the form of a $14 Million Loan to the Company that will not be recorded until received in April 2021.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk.

Not Applicable.

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Item 8. Financial Statements and Supplementary Data.

See Financial Statements following the signature page of this report.

Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.

None

Item 9A. Controls and Procedures.

None.

Item 9A(T). Controls and Procedures.

(a) Evaluation of Disclosure Controls and Procedures. The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934, as amended). We are committed to maintaining disclosure controls and procedures designed to ensure that information required to be disclosed in our periodic reports filed under the Securities Exchange Act of 1934, as amended, or the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures and implementing controls and procedures.

Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rules 13a-15(e) and 15d-15(e) promulgated under the Exchange Act and based on the criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures were effective at a reasonable assurance level as of December 31, 2020, the end of the period covered by this Report. However anticipating greater levels of business activity in the near term we expect that we will require a financial controller in order to maintain our disclosure controls and procedures. Steps have been taken to bring on this person in a timely manner.

Management’s Annual Report on Internal Control over Financial Reporting. Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes of accounting principles generally accepted in the United States.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance of achieving their control objectives.

Our management, with the participation of the President, evaluated the effectiveness of the Company’s internal control over financial reporting as of December 31, 2020. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control — Integrated Framework. Based on this evaluation, our management, with the participation of the President, concluded that, as of December 31, 2020, our internal control over financial reporting was effective.

This annual report does not include an attestation report of the Company’s 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 temporary rules of the Securities and Exchange Commission that permit the Company to provide only management’s report in this annual report.

(b) Changes in Internal Control over Financial Reporting. There were no changes in the Company's internal controls or procedures over financial reporting, known to the chief executive officer or the chief financial officer that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

Item 9B. Other Information.

There are no further disclosures. All information that was required to be disclosed in 2020 has been disclosed.

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PART III

Item 10. Directors, Executive Officers and Corporate Governance.

Identification of Directors, Executive Officers and Significant Employees

The following sets forth certain information concerning the current directors, executive officers and significant employees of our company. Each director has been elected to serve until our next annual meeting of stockholders and until his successor has been elected and qualified. Each executive officer serves at the discretion of the board of directors of our Company, and each has been elected for a 1 year term.

⁽¹⁾Member of the Compensation and Governance Committees. 

⁽²⁾Independent Director. 

Our directors and executive officers have not, during the past five years:

·had any bankruptcy petition filed by or against any business of which such individual was a general partner or executive officer, either at the time of the bankruptcy or within two years prior to that time, 

·been convicted in a criminal proceeding and is not subject to a pending criminal proceeding, 

·been subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities, futures, commodities or banking activities; or been found by a court of competent jurisdiction (in a civil action), the Securities Exchange Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated. 

Business Experience

The following is a brief biography of our officers and directors.

Rod Bartlett. President, CEO and Director has over 40 years of experience in business development. Rod was a founding shareholder of TransAct Energy Corp. and has been instrumental in bringing it through the regulatory and business development process. Rod is heavily involved in the negotiations related to securing future business for the company. During the last decade, Rod has been active in the public markets. ActionView International (advertising), Quest Oil (oil & gas), and S2C Global Systems (water distribution) are a few of the companies that he has been instrumental in developing and taking them to the next level.

Joseph F. Dickson. Director: Joseph Dickson was the Chief Operating Officer of Innovation Fuels, Inc. out of Syracuse, NY leading the company’s bio-diesel plant operation and project development efforts from Sept. 2007 until Dec. 2009. Mr. Dickson was the Director of Entrepreneurship at Syracuse University, Syracuse, NY from Feb. 2006 to Sept. 2007, the COO, Integrated Defense Systems, Inc., Glen Rock, PA from June 2005 to Jan. 2006 and the COO, Drug Risk Solutions, LLC a drug discovery company from June 2000 to June 2005. Mr. Dickson has 40 years of business experience in new ventures, business plan execution, organizational management, and operations. He has a background in high tech product design and development, manufacturing, and sales and marketing to commercial and military markets gained while working at GE and other high tech companies. He started and successfully financed two companies in the microelectronics and information technology industries. He has an undergraduate degree in chemistry and an MBA.

Karie Elsasser. Director Karie Elsasser is a senior level executive with 20 years’ experience in banking, finance and commodities. Most recently Karie serves as the CFO for Native Fuels a Wisconsin based company supporting the development of First Nation assets and resources both Nationally and Internationally in a sustainable way through assisting in the business development process including planning, sourcing technology partnerships, finance and commodity sales. Karie also owned and operated her own successful mortgage brokerage for a period of five years prior. Earlier Ms. Elsasser was a senior loans officer with Washington Mutual.

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Christina Kenny. Director was the CPO at ABTRAN a customer and business process management solution provider , from November 2017 thru August 2019, CPO-Global at Voxpro Ireland and International a multilingual customer experience & technical support solution provider from September 2016 to October 2017, the CEO, Change by Design, Scotsdale, AZ a management consulting firm from 2012 to Jan. 2016 and the Chief Admin Officer and SVP People at NTRplc US and Ireland an international renewable energy group from June 2008 to June 2012. Ms. Kenny has over 20 years of business experience in new ventures, business plan execution, organizational management, and operations. She has an extensive background in human resources and people management. Ms. Kenny led successful international expansion efforts managing growth from 125 employees to 5000+ in new renewable energy and waste management business. She has an undergraduate degree in finance/human resources and an MBA.

Tina VanderHeyden. Director: Tina VanderHeyden is a senior level executive with 32 years diverse funding and business development experience in both the public and private sectors. For the green technology sector, she recently completed funding and co-managed the installation of a major geothermal system and HVAC overhaul for a “Heritage” estate. In addition to her long term fundraising work in the education and cultural sectors, she spent several years leading research and funding for bio-tech and new technology start-ups including new business development for the Bedminster BioEnergy Technology; which uses recovered high quality Biomass to provide renewable energy.

Significant Employees Who Are Not Executive Officers

Kelly McKinley. SVP Real Estate and Project Development oversees integrated architectural design with construction management with a focus on environmental sustainability. Combined with his broad-based international knowledge and expertise he promotes the kind of synergies that inform project visioning, quality design, cost-effective construction and technical decisions. He has designed and built projects in the South Pacific, Hawaii, Texas, Washington and across Canada while traveling extensively researching sustainable architecture and urban design. For over thirty years has developed residential, commercial, industrial projects with the utmost concern for quality, cost effectiveness and work site safety. He has a Bachelor’s of Architecture, Houston TX., Assoc. AIA.,

Family

There are no family relationships between the members of our board of directors. Janice Bartlett, director of TransAct Energy Global Limited is a UK attorney and cousin to Rod Bartlett.

Audit Committee and Audit Committee Financial Expert

To date, the board of directors (“BOD”) has not formed a formal audit committee, nor has it secured an audit committee financial expert. The BOD intends to form said committee and secure said expert when it becomes operational.

Audit Committee Financial Expert

Our board of directors currently acts as our audit committee. Because we have not commenced significant operations to date, our Board of Directors is still in the process of finding an "audit committee financial expert" (as defined in Regulation S-K) and directors that are "independent" (as that term is used in Section 10A of the Securities Exchange Act).

Audit Committee

Our audit committee will oversee a broad range of issues surrounding our accounting and financial reporting processes and audits of our financial statements, including by (1) assisting our board in monitoring the integrity of our financial statements, our compliance with legal and regulatory requirements, our independent auditor's qualifications and independence and the performance of our internal audit function and independent auditors, (2) appointing, compensating, retaining and overseeing the work of any independent registered public accounting firm engaged for the purpose of performing any audits, reviews or attest services, and (3) preparing the audit committee report that may be included in our annual proxy statement or annual report on Form 10-K. We will have at least three directors on our audit committee, each of whom will be independent under the requirements of the NASDAQ Capital Market, the Sarbanes-Oxley Act and the rules and regulations of the SEC.

Other Committees of the Board

Compensation Committee. Our compensation committee will review and recommend our policies relating to compensation and benefits for our executive officers and other significant employees, including reviewing and approving corporate goals and objectives relevant to compensation of our Chief Executive Officer and other executive officers, evaluating the performance of our executive officers relative to goals and objectives, determining compensation for these executive officers based on these evaluations and overseeing the administration of our incentive compensation plans. The compensation committee will also prepare the compensation committee report that may be included in our annual proxy statement or annual report on Form 10-K. We will have at least two directors on our compensation committee, each of whom will be independent under the requirements of the NASDAQ Capital Market. 

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Nominating and corporate governance committee. Our nominating and corporate governance committee will (1) identify, review and recommend nominees for election as directors, (2) advise our board of directors with respect to board composition, procedures and committees, (3) recommend directors to serve on each committee, (4) oversee the evaluation of our board of directors and our management, and (5) develop, review and recommend corporate governance guidelines and policies. We will have at least two directors on our nominating and corporate governance committee, each of whom will be independent under the requirements of the NASDAQ Capital Market.

Code of Ethics We have recently adopted a Code of Ethics and Business Conduct authorizing the establishment of a committee to ensure that our disclosure controls and procedures remain effective. Our Code also defines the standard of conduct expected by our officers, directors and employees.

Item 11. Executive Compensation.

We have a formal compensation agreement with our Chief Executive Officer, Chief People Officer and our SVP Real Estate and Project Development. We do not currently have a compensation agreement with our BOD and our Advisory Board members, although we intend to do so in the future. All Officers, Directors and Advisory Board members are reimbursed for their expenses related to Company service. Our active officers will receive compensation for the year ended December 31, 2020. The Directors were accrued $7,692 for the full 2020 year. The directors of each subsidiary were accrued $4,107 for active and $2,054 for inactive companies for the full 2020 year prorated where applicable.

SUMMARY COMPENSATION TABLE

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Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

The following table sets forth as of December 31, 2020, the name and shareholdings of each person known to us that either directly or beneficially holds more than 5% of our 60,728,912 issued and outstanding shares of common stock, $.001 par value. The table also lists the name and shareholdings of each director and of all officers and directors as a group. Except as otherwise indicated, the persons named in the table have sole voting and dispositive power with respect to all shares beneficially owned, subject to community property laws where applicable.

(1)Officer and/or director. 

(2)Director of subsidiary 

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Item 13. Certain Relationships and Related Transactions, and Director Independence.

We have received funds from our officers and directors to fund the Company’s activities. Currently we owe Mr. Rod Bartlett $267 but does not include compensation. The Company lent Aqua Terra Power a company wholly owned by one of our previous shareholders, $263,520. Terra Energy, a company owned by one of our previous shareholders lent us $27,500.

Except for the foregoing, we have not been a party to any transaction, proposed transaction or series of transactions in which the amount involved exceeded the lesser of $120,000 or one percent of the average of the Company's total assets at year end for the last two completed fiscal years, and in which, to our knowledge, any of our directors, officers, five percent beneficial security holders or any member of the immediate family of the foregoing persons has had or will have a direct or indirect material interest.

Except for the foregoing, none of the following parties has, since the date of incorporation of the Company, had any material interest, direct or indirect, in any transaction with the Company or in any presently proposed transaction that has or will materially affect us:

·any of our directors or officers; 

·any person proposed as a nominee for election as a director; 

·any person who beneficially owns, directly or indirectly, shares carrying more than 10% of the voting rights attached to our  

·outstanding shares of common stock; or 

·any relative or spouse of any of the foregoing persons who has the same house as such person. 

Item 14. Principal Accounting Fees and Services.

The fees for services billed by Haynie& Company to the Company in the last two fiscal years were as follows:

Audit Fees. There were no fees charged in 2020 as no audit of our financial statements for our annual report on Form 10-K and the review of our quarterly financial statements for our quarterly reports on Form 10-Q that are customary under auditing standards generally accepted in the United States took place. There were no fees charged in 2020 as no professional services were rendered in connection with the audit of our financial statements for our annual report on Form 10-K nor did they do a review of our quarterly financial statements for our quarterly reports on Form 10-Q that are customary under auditing standards generally accepted in the United States.

Audit Committee Pre Approval Policies and Procedures

The Company does not have an audit committee and is in search of qualified candidates to form such committee. As a result, the Company does not have any pre-approval policies or procedures for audit or non-audit services.

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PART IV

Item 15. Exhibits, Financial Statement Schedules.

(a) Index to Financial Statements and Financial Statement Schedules

The following un-audited financial statements are included on the pages indicated:

(b) Exhibits

* Incorporated by reference. Filed as exhibit to S-1 filed October 28, 2008

**The Exhibit attached to this Form 10-K shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 (the "Exchange Act") or otherwise subject to liability under that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

TRANSACT ENERGY CORP.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

25

TRANSACT ENERGY CORP.

[A Development Stage Company]

FINANCIAL STATEMENTS

December 31, 2020

(Unaudited – Prepared by Management)

F-1

TRANSACT ENERGY CORP.

(A Development Stage Company)

INTERIM BALANCE SHEET

(Unaudited - Prepared by Management)

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

F-2

TRANSACT ENERGY CORP.

(A Development Stage Company)

INTERIM STATEMENTS OF OPERATIONS

(Unaudited - Prepared by Management)

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

F-3

TRANSACT ENERGY CORP.

(A Development Stage Company)

INTERIM  STATEMENTS OF CASH FLOWS

(Unaudited - Prepared by Management)

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

F-4

TRANSACT ENERGY CORP.

(A Development Stage Company)

STATEMENT OF STOCKHOLDERS’ EQUITY (DEFICIT)

FROM INCEPTION ON MARCH 15, 2006 THROUGH DECEMBER 31, 2020

(Unaudited)

F-5

TRANSACT ENERGY CORP.

(A Development Stage Company)

STATEMENT OF STOCKHOLDERS’ EQUITY (DEFICIT)

FROM INCEPTION ON MARCH 15, 2006 THROUGH DECEMBER 31, 2020

(Unaudited)

(CONTINUED)

F-6

TRANSACT ENERGY CORP.

(A Development Stage Company)

STATEMENT OF STOCKHOLDERS’ EQUITY (DEFICIT)

FROM INCEPTION ON MARCH 15, 2006 THROUGH DECEMBER 31, 2020

(Unaudited)

(CONTINUED)

F-7

TRANSACT ENERGY CORP.

(A Development Stage Company)

STATEMENT OF STOCKHOLDERS’ EQUITY (DEFICIT)

FROM INCEPTION ON MARCH 15, 2006 THROUGH DECEMBER 31, 2020

(Unaudited)

(CONTINUED)