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-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ such files). Yes x No ¨

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

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 Exchange Act. ¨

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

The number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

The Company is filing this Current Report on Form 10-Q in reliance upon the Order of the Commission dated March 25, 2020 (Release No. 34-88465) (the “Order”) permitting the delay of certain filings required under the Securities and Exchange Act of 1934, as amended. The Company filed its Current Report on Form 8-K on May 14, 2020, indicating its intent to rely upon the Order and that it required additional time to review and prepare certain information in its financial statements following delays resulting from the COVID-19 pandemic related challenges.

Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited)

See accompanying notes to unaudited interim condensed consolidated financial statements.

BioHiTech Global, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets, continued:

See accompanying notes to unaudited interim condensed consolidated financial statements.

Note 1715 includes supplemental cash flow information, non-cash investing and financing activities and changes in operating assets and liabilities.

See accompanying notes to unaudited interim condensed consolidated financial statements.

Condensed Consolidated ~~Statement~~Statements of Changes in Stockholders’ ~~Deficit~~Equity (Unaudited)

See accompanying notes to unaudited interim condensed consolidated financial statements.

~~For the Three and Nine Months Ended September 30, 2017 and 2016, and as of September 30, 2017 and December 31, 2016~~

Nature of Operations ~~-BioHiTech~~- BioHiTech Global, Inc. (the “Company” or “BioHiTech”) through its wholly-owned and its controlled subsidiaries ~~BioHiTech America, LLC, BHT Financial LLC, BioHiTech Europe Limited and E.N.A. Renewables LLC (formerly Entsorga North America, LLC) (collectively “subsidiaries”) offers its customers~~provides cost-effective and ~~technologically innovative advancements integrating technological,~~sustainable environmental management solutions.

Our cost-effective technology solutions include the patented processing of municipal solid waste into a valuable renewable fuel, biological disposal of food waste on-site, and ~~mechanical engineering~~proprietary real-time data analytics tools to reduce food waste generation. Our solutions enable businesses and municipalities of all sizes to lower disposal costs while having a positive impact on the environment. When used individually or in combination, our solutions lower the carbon footprint associated with waste transportation and can reduce or virtually eliminate landfill usage.

In March 2020, the World Health Organization declared the outbreak of a novel coronavirus (COVID-19) as a pandemic which continues to spread throughout the United States and globally. The Company is monitoring the near term and longer term impacts of COVID-19 and the related business and travel restrictions and changes to behavior intended to reduce its spread, and its impact on operations, financial position, cash flows, inventory, supply chains, purchasing trends, customer payments, and the industry in general, in addition to the impact on its employees. Due to the rapid development and fluidity of this situation, the magnitude and duration of the pandemic and its impact on the Company’s operations, liquidity and financial performance will depend on certain developments, including duration, spread and reemergence of the outbreak, its impact on our customers, supply chain partners and employees, and the range of governmental and community reactions to the pandemic, which are uncertain and cannot be fully predicted at this time.

As a result of COVID-19 the implementation of the Company’s contract with Carnival Corporation has been delayed and the operations of some customers in the restaurant and hospitality industries have been temporarily interrupted due to governmental actions. For certain existing restaurant and hospitality customers, the Company has provided a deferral of recurring rental payments for a short time and have modified the ~~control, reduction~~rental agreements to extend the term by the period deferred. These actions have placed a strain on the Company’s cash flows resulting in the Company executing on cost controls and ~~/ or reuse of organic~~cash preservation practices that have included reducing executive cash compensation, laying off non-essential employees, limiting expenses and ~~municipal waste.~~disbursements, as well as extending vendor payments.

Basis of Presentation— - The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned and controlled subsidiaries and have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial ~~information.~~information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Certain information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted. Accordingly, they do not include all the information and footnotes necessary for a comprehensive presentation of financial position, results of operations, or cash flows. It is management’s opinion, however, that the accompanying condensed consolidated financial statements include all adjustments, consisting of a normal recurring nature, and the elimination of intercompany accounts and transactions which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented.

The accompanying condensed consolidated financial statements should be read in conjunction with the Company’s financial statements for the year ended December 31, ~~2016,~~2019, which contains the audited financial statements and notes thereto, for the years ended December 31, ~~2016~~2019 and ~~2015~~2018 included within the Company’s Form 10-K filed with the Securities and Exchange Commission (“SEC”) on ~~March 30, 2017.~~May 22, 2020. The financial information as of December 31, ~~2016~~2019 presented hereto is derived from the audited consolidated financial statements presented in the Company’s audited consolidated financial statements for the year ended December 31, ~~2016.~~2019. The interim results for the three ~~and nine~~ months ended ~~September 30, 2017 are~~March 31, 2020 is not necessarily indicative of the results to be expected for the year ending December 31, ~~2017~~2020 or for any future interim periods.

As of March 31, 2020 and December 31, 2019, the Company’s active wholly-owned subsidiaries were BioHiTech America, LLC, BioHiTech Europe Limited, BHT Financial, LLC and E.N.A. Renewables LLC, and its controlled subsidiary was Refuel America LLC (60%) and its wholly-owned subsidiaries Apple Valley Waste Technologies Buyer, Inc., Apple Valley Waste Technologies, LLC, New Windsor Resource Recovery LLC and Rensselaer Resource Recovery LLC and its controlled subsidiary Entsorga West Virginia LLC (88.7%, 88.7% and 78.2% as of March 31, 2020, December 31, 2019 and March 31, 2019, respectively). As each of these subsidiaries operate as environmental-based service companies, we did not deem segment reporting necessary.

Reclassifications to certain prior period amounts have been made to conform to current period presentation. These reclassifications have no effect on previously reported net loss.

Going Concern —and Liquidity For the ~~nine~~three months ~~ended September 30, 2017,~~March 31, 2020, the Company had a consolidated net loss of ~~$6,214,925,~~$3,393,974, incurred a consolidated loss from operations of ~~$5,002,761~~$2,393,950 and used net cash in consolidated operating activities of ~~$3,836,030. For the year ended December~~$2,515,474. At March 31, ~~2016, the Company had a net loss of $6,745,386, incurred a~~2020, consolidated ~~loss from operations of $5,924,667 and used net cash in consolidated operating activities of $5,181,400. At September 30, 2017,~~total stockholders’ equity amounted to $5,787,541, consolidated stockholders’ ~~deficit~~equity attributable to parent amounted to ~~$16,140,210~~$1,264,636 and the Company had a consolidated working capital deficit of ~~$5,651,550.~~$11,913,331. While the Company had not met certain of its senior secured note’s financial covenants as of March 31, 2020 (Note 6), subsequent to that date the Company has favorably renegotiated those covenants and has received a waiver for such non-compliance through June 30, 2020 as it continues to negotiate further extension of that waiver. Despite its current compliance under the waiver, until such time as the Company regains compliance or receives a waiver of such covenants for a year beyond the balance sheet date, under current GAAP accounting rules the senior secured notes amounting to $4,241,578 have been classified as current debt. The Company does not yet have a history of financial ~~stability. Historically~~profitability. The Company does not have firm commitments to fund its future operational and strategic plans although it is presently in the ~~principal source~~process of ~~liquidity~~raising additional debt for general operations and to support its leasing activities. The Company has ~~been~~used its Shelf Registration on Form S-3 during September 2019 to raise net proceeds of $3,035,557 through a confidentially marketed public offering of common shares, has raised $1,495,450 through a private convertible preferred stock offering in March 2020 and subsequent to March 31, 2020 one of the ~~issuance of~~Company’s subsidiaries was funded $421,300 on May 13, 2020 through the Paycheck Protection Program.. There is no assurance that the Company will be able to raise sufficient capital or debt ~~and equity securities.~~to sustain operations or to pursue other strategic initiatives or that such financing will be on terms that are favorable to the Company. These factors raise substantial doubt about the Company’s ability to continue as a going concern.

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. These consolidated financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern. The ability of the Company to continue as a going concern is dependent on ~~management's~~management’s further implementation of the Company’s on-going and strategic plans, which include continuing to raise funds through ~~debt~~equity and/or ~~equity~~debt raises. Should the Company be unable to raise adequate funds, certain aspects of the on-going and strategic plans may require modification.

The Company is presently in the process of raising additional non-registered preferred stock, senior debt, convertible debt and capital for general operations and for investment in several strategic initiatives, as well as commercial debt to support its leasing activities. There is no assurance that the Company will be able to raise sufficient debt or capital to sustain operations or to pursue other strategic initiatives.

The ~~preparation of~~condensed consolidated financial statements have been prepared by the Company without audit in ~~conformity~~accordance with the rules and regulations of the SEC and should be read in conjunction with our audited financial statements for the year ended December 31, 2019. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP ~~requires~~have been condensed or omitted as permitted by the ~~extensive use of management’s estimates and assumptions~~SEC, although we believe the disclosures that ~~affect~~are made are adequate to make the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from these estimates. Estimates are used when accounting for items and matters including, butinformation presented herein not limited to, allowance for uncollectible accounts receivable, obsolete, slow moving and excess inventory, asset valuations, including goodwill and intangibles, and useful lives, employee benefits, taxes and other provisions and contingencies.

~~For the Three and Nine Months Ended September 30, 2017 and 2016, and as of September 30, 2017 and December 31, 2016~~misleading.

~~Product and Services Revenue Recognition~~Recent Accounting Pronouncements: — The Company recognizes revenue for the majority of its products sold upon transfer of title and the passage of the risk of ownership, which is generally upon shipment to the customer. Revenue from services is recognized as services are performed.

~~Lease Revenue Recognition~~ — The Company recognizes revenue from the rental of the digester units ratably on a monthly basis over the term of the lease, as it has determined that the rental agreements entered into in connection with its digester units qualify as operating leases, for which the Company is the operating lessor.

~~Fair Value Measurements~~ — Certain assets and liabilities are required to be recorded at fair value on a recurring basis. Fair value is determined based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. Assets measured at fair value on a nonrecurring basis include long-lived assets held and used, long-lived assets held for sale, goodwill and other intangible assets. The fair value of cash and cash equivalents, accounts receivable, short-term debt and accounts payable approximate their carrying values. The three-tier value hierarchy, which prioritizes valuation methodologies based on the reliability of the inputs, is:

~~Level 1~~ ~~— Valuations based on quoted prices for identical assets and liabilities in active markets.~~

~~Level 2~~ — Valuations based on observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data.

~~Level 3~~ ~~— Valuations based on unobservable inputs reflecting the Company’s own assumptions, consistent with reasonably available assumptions made by other market participants.~~

~~Equity Method Based Investments —~~ The Company utilizes the equity method of accounting for investments in companies if the investment provides the ability to exercise significant influence, but not control, over operating and financial policies of the investee. The Company’s proportionate share of net income or loss is included in the Company’s consolidated operations as earning or loss from unconsolidated equity basis investments.

~~Income Taxes~~— Deferred income taxes are determined based on the estimated future tax effects of differences between the financial statement and tax bases of assets and liabilities given provisions of enacted laws. Deferred income tax provisions and benefits are based on changes to the asset or liabilities from year to year. In providing for deferred taxes, the Company considers tax regulations of the jurisdictions in which it operates, estimates the future taxable income and available tax planning strategies. If tax regulations, operating results or the ability to implement tax planning and strategies vary, adjustments to the carrying value of deferred tax assets and liabilities may be required. Valuation allowances are recorded related to deferred tax assets based on the “more than likely” criteria.

For the nine and three months ended September 30, 2017 and 2016, the Company’s effective rate, before valuations, was 39.8% and 36.7%, respectively, and would have resulted in net deferred tax assets for federal and state tax purposes arising primarily from net operating losses; A full valuation allowance, due to the level of uncertainty relative to the realization of the deferred tax assets, has been provided resulting in an effective tax rate of 0.0%.

~~Loss per Share~~— The Company computes basic loss per share using the weighted-average number of shares of common stock outstanding and diluted loss per share, while the diluted loss per share also includes the effects of dilutive instruments using the “treasury method.”

The ~~Company’s potential dilutive instruments include options, convertible debt and warrants. These instruments have~~Company has not ~~been considered in~~implemented any recent accounting pronouncements during the ~~calculation of diluted loss per share as they are anti-dilutive for the reported periods.~~

~~For the Three and Nine Months Ended September 30, 2017 and 2016, and as of September 30, 2017 and December~~three months ended March 31, ~~2016~~2020.

~~Note 3. Accounts Receivable, net~~The Company has not implemented the following accounting standard:

In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments. This standard requires an allowance to be recorded for all expected credit losses for certain financial assets. The new standard introduces an approach, based on expected losses, to estimate credit losses on certain types of financial instruments. ASU 2016-13 is effective for public companies for interim and annual period beginning December 15, 2020. Entities are required to apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the ~~following:~~beginning of the first reporting period in which the guidance is adopted. The Company has not yet adopted this update and is currently evaluating the effect this new standard will have on its financial condition and results of operations.

~~Inventory, comprised~~There have been no other recent accounting pronouncements or changes in accounting pronouncements that have been issued but not yet adopted that are of ~~finished goods and parts~~significance, or ~~assemblies, consist of~~potential significance, to the ~~following:~~Company.

During the three months ended September 30, 2017 and 2016, depreciation expense included in cost of revenue, amounted to $69,312 and $97,356, respectively. During the nine months ended September 30, 2017 and 2016, depreciation expense included in cost of revenue, amounted to $213,268 and $247,685, respectively.

The Company is a lessor of ~~Revolution and Eco Safe Series~~ digester units under non-cancellable operating lease agreements expiring through ~~December 2022.~~ September 2025. These leases generally have terms of three to five years and do not contain stated extension periods or options for the lessee to purchase the underlying assets. At the end of the leases, the lessee may enter into a new lease or return the asset, which would be available to the Company for releasing.

During the three months ended ~~September 30, 2017~~March 31, 2020 and ~~2016,~~2019, revenue under the agreements, which is included in rental, service and maintenance revenue, amounted to ~~$224,828~~$386,254 and ~~$182,715,~~$341,665, respectively. During the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2020 and ~~2016, revenue under the agreements, which is~~2019, depreciation expense included in rental, service and maintenance ~~revenue,~~expense, amounted to ~~$636,406~~$115,866 and ~~$505,877,~~$101,502, respectively.

The minimum future estimated contractual payments to be received under these leases as of ~~September 30, 2017~~March 31, 2020 is as follows:

~~For the Three and Nine Months Ended September 30, 2017 and 2016, and as of September 30, 2017 and December 31, 2016~~

HEBioT facility, equipment, fixtures and vehicles, net consist of the following:

MBT Facility Development Costs - During 2018, the Company commenced initial development of a project in Rensselaer, NY. As of March 31, 2020, the Company has received local permits and has filed the required state permit applications, which are undergoing review by the New York State Department of Environmental Conservation.

Technology License Agreement – Future Facility - The royalty payment for the license amounted to $6,019,200. This Technology License Agreement can be utilized at a future project and will be amortized once the facility is in operation.

Technology License Agreement – Martinsburg, West Virginia - In connection with the 2018 acquisition accounting applied to Entsorga West Virginia acquisition, the License Agreement was valued at $1,890,000. During the three months ~~ended September 30, 2017 and 2016, depreciation expense~~ending March 31, 2020 amounted to ~~$5,124~~$31,500. Amortization of the License Agreement commenced with the facility becoming operational on March 31, 2019 and ~~$4,675, respectively. During~~there was no amortization for the ~~nine~~three months ended ~~September~~Mach 31, 2019.

Note 6. Line of Credit, Promissory Notes Payable, Notes Payable, Advances, and Long-Term Debts

Line of Credit, Promissory Notes Payable, Notes Payable, Advances, and Long-Term Debts consist of the following:

Line of Credit — The Credit Agreement and Note with Comerica does not have any financial covenants, carries interest at the rate of 3%, plus either the Comerica prime rate or a LIBOR-based rate, (5.58% and 5.71% as of March 31, 2020 and December 31, 2019, respectively) and matured on January 1, 2020, which was subsequently extended to March 31, 2020 and remains outstanding as of the date of this filing. The Company expects to obtain an amended agreement through the remainder of 2020. The line of credit is secured by the assets of BHT Financial, LLC and is personally guaranteed by the Company’s Chief Executive Officer, Frank E. Celli and James D. Chambers, a director.

Michaelson Senior Secured Term Promissory Financing — Company and several of the Company’s wholly-owned subsidiaries have a Note Purchase and Security Agreement with Michaelson Capital Special Finance Fund II, L.P. (“ MCSFF ”) for a senior secured term promissory note in the principal amount of $5,000,000 (the “Note”). The Note is not convertible and accrues interest at the rate of 10.25% per annum. The Note provides for certain financial covenants that were not met as of March 31, 2020. While the Company had not met certain of its senior secured note’s financial covenants as of March 31, 2020, subsequent to that date the Company has favorably renegotiated those covenants and has received a waiver for such non-compliance through June 30, ~~2017~~2020 as it continues to negotiate further extension of that waiver. Despite its current compliance under the waiver, until such time as the Company regains compliance or receives a waiver of such covenants for a year beyond the balance sheet date, under current GAAP accounting rules the senior secured notes amounting to $4,241,578 have been classified as current debt. As of December 31, 2019 those certain financial covenants were not met and ~~2016, depreciation~~a waiver of such was granted by MCSFF through January 1, 2021 with the condition that the parties negotiate new financial covenants, which were concluded subsequent to March 31, 2020. As of December 31, 2019, the Note has been classified based on the contractual repayment schedule. For purposes of the following maturity schedule, as the Company believes that it will achieve compliance with the revised financial covenants and MCSFF has a history of waiving non-compliance with financial covenants, the maturities have been presented based upon the contractual repayment terms in effect as of March 31, 2020. The Note is contractually scheduled to be repaid in eight, equal, quarterly installments of $625,000 commencing on May 15, 2021 and ending February 2, 2023 (the “Maturity Date”).

Note Payable — As of March 31, 2020 and December 31, 2019, the note, with interest at 10%, had a remaining balance outstanding of $100,000 and matured on January 1, 2020 and remains outstanding as of the date of this filing. The Company expects to amend the agreement to extend the maturity date through the remainder of 2020.

Contractual Maturities of Senior Secured, Junior Promissory, Notes Payable and Long Term Debt — As of March 31, 2020, excluding discounts and deferred finance costs, which are being amortized as interest expense, ~~amounted to $15,422 and $10,625, respectively.~~are as follow:

Effective January 1, 2017, the Company executed several agreements to acquire up to approximately a 40% interest in EWV from the original investors at their original purchase price of $60,000 for each 1% of interest in EWV. The agreement provides for a required investment of $1,034,028, representing a 17.2% interest, with the remaining 23.1% being at the option of the Company. The agreement was subject to the approval of the EWV bond trustee, which was granted on March 20, 2017. On March 21, 2017, the Company completed the required investment acquisition of $1,034,028 for a 17.2% interest, which is recognized utilizing the equity method of accounting.

~~EWV has financed the development and construction of the facility through $25,000,000 in~~WVEDA Solid Waste Disposal Revenue Bonds

During 2016, Entsorga West Virginia LLC (the “Borrower”) was issued by$25,000,000 in Non-Recourse Solid Waste Revenue Bonds from the West Virginia Economic Development Authority (the ~~“Bonds”~~“WVEDA Bonds”). The WVEDA Bonds were issued in two series with one for $7,535,000 bearing interest at 6.75% per annum with a maturity date of February 1, 2026 and the second for $17,465,000 bearing interest at 7.25% per annum with a maturity of February 1, 2036. Both series were issued at par. The 2026 series was payable with interest-only payments through February 1, 2019 then annual payments of principal and semi-annual payments of interest through maturity. The 2036 series is payable with interest-only payments through February 1, 2019 then annual payments of principal and semi-annual payments of interest through maturity. Repayment of principal is by way of sinking fund.

During 2018, the 2016 Indenture Trust and Loan Agreement were amended and restated effective November 1, 2018. These amendments provided for a third series of bonds amounting to $8,000,000 bearing interest at 8.75% per annum with a maturity date of February 1, 2036, with special event triggered pre-payment requirements. This series was issued at par. The 2036 series is payable with interest-only payments through February 1, 2020 then annual payments of principal and semi-annual payments of interest through maturity. Repayment is by way of sinking fund.

The outstanding balance of the WVEDA Bonds as of March 31, 2020 and December 31, 2019 is $33,000,000, which is presented net of unamortized debt issuance costs amounting to $2,207,759 as of March 31, 2020 and December 31, 2019, less associated amortization of $460,492 and $415,185 as of March 31, 2020 and December 31, 2019, respectively, which includes amortization prior to the Company’s control acquisition in 2018. Amortization is calculated on the effective interest method, which is included in interest expense in the accompanying consolidated statements of operations and comprehensive loss.

The loan agreement and indenture of trust place restrictions on the Borrower and its members regarding additional encumbrances on the property, disposition of the property, and limitations on equity distributions. The loan agreement also provides for financial covenants, which became effective on September 30, 2019. As of March 31, 2020 and December 31, 2019 the Company was not in compliance with all of the financial covenants and subsequently was in default on a principal repayment due in February 2020 and has entered into a forbearance agreement with the bond trustee that provides, they will not accelerate the repayment of the bonds due to the defaults through April 2, 2021.

The future sinking fund payments by the Borrower as of March 31, 2020 are as follow:

In connection with the November 1, 2018 amendment and restatement of the WVEDA Bonds, ~~each member has been required to pledge their membership interest~~Comerica Bank issued a standby letter of credit in ~~EWV to~~ the amount of $1,250,000 for the benefit of the WVEDA Bond trustee ~~as collateral of~~that is collateralized by the ~~Bonds.~~

~~For the Three and Nine Months Ended September 30, 2017 and 2016, and as of September 30, 2017 and December 31, 2016~~Company’s cash.

OnThe Company has 50,000,000 shares of its $0.0001 par common stock and 10,000,000 shares of blank check preferred stock authorized by its shareholders. As of March ~~1, 2017~~31, 2020 and December 31, 2018, 17,417,288 and 17,300,899 shares of common stock have been issued; and 3,209,210 and 3,179,120 shares, respectively, of preferred stock have been designated in five series of shares, which have a total of $1,192,619 in accumulated, but undeclared preferential dividends as of March 31, 2020, as follows:

Under the Town Counsel of New Windsor, NY approved, subject to a 30 day petition period during which certain voters could object to the sale of 12 acres of property to the Company for the development of a Mechanical Biological Treatment (“MBT”) facility. On April 3, 2017, the Town Clerk of New Windsor certified that there had not been any objections raised and the agreement was executed on April 10, 2017. The purchase price of the property is $1,092,000, subject to reduction for option payments made by the Company in the monthly amount of $3,500 for the first 12 months and $6,000 per month for the following 12 months, until the closing. The purchase of the property is contingent upon the Company obtaining: necessary permits to allow construction of a Mechanical Biological Treatment (“MBT”) facility; approvals from state and local authorities; financing for the construction of the MBT facility; contracts for offtake of Solid Recovered Fuel; and the satisfactionterms of the Company’s ~~due diligence investigation of~~senior lender agreements, the ~~property.~~Company is restricted from paying dividends in cash, but is allowed to pay dividends in common stock. The ~~contract also contains customary representations warranties and covenants of the parties for like transactions.~~Company, since its merger in 2015, has not paid any cash or stock dividends on common stock.

~~As of September 30, 2017, the~~The consolidated financial statements include ~~capitalized costs~~less than 100% owned and controlled subsidiaries and include equity attributable to non-controlling interests that take the form of the underlying legal structures of the less than 100% owned subsidiaries. Entsorga West Virginia LLC through its limited liability agreement and the agreements related to its WVEDA Bonds have restrictions on distributions to and loans to owners while the ~~New Windsor, NY site, including those related~~WVEDA Bonds are outstanding.

Series F Convertible Preferred Stock — On March 9, 2020 the Company designated a new series of preferred stock and subsequently on March 18, 2020 had an initial closing of $1,500,000 on 13,045 shares of the new series of preferred stock and 178,597 common stock warrants and are presented net of $50,836 in warrant valuations and $4,550 in issuance costs. The newly designated series, the Series F Redeemable, Convertible Preferred Stock (the “Sr. F Preferred Stock”) is comprised of 30,090 shares with a par value of $0.0001 per share and a stated value per share of $115.00 that has a dividend rate of 9%. The Sr. F Preferred Stock is convertible by the holder at any time at a conversion rate of $2.10, subject to certain antidilution adjustments and is redeemable by the ~~land option payments, legal costs~~Company after 24 months at its stated value, plus any outstanding accrued or accumulated dividends for cash, or if the Company’s common stock is trading over $3.00 per share and ~~survey/engineering costs~~has daily trading volume of ~~$42,000, $10,372~~over 50,000 shares, for the Company’s common stock at the conversion rate in effect at the time. In connection with the offering of the Sr. F Preferred Stock, the Company also issued 178,597 warrants that expire in five years to acquire the Company’s common stock at $2.30 per share.

Warrants — In connection with the issuance of convertible debt, preferred and ~~$86,941, respectively.~~common stock and in connection with services provided, the Company has the 4,852,858 warrants to acquire the Company’s common stock outstanding as of March 31, 2020, as follows:

The following table summarizes the outstanding warrant activity for the three months ended March 31, 2020:

2015 Equity Incentive Plan — During 2015, the Company established the BioHiTech Global, Inc. 2015 Equity Incentive Plan, which is available to eligible employees, directors, consultants and advisors of the ~~following:~~Company and its affiliates. The plan allows for the granting of incentive stock options, nonqualified stock options, reload options, stock appreciation rights, and restricted stock representing up to 750,000 shares. The Plan is administered by the Compensation Committee of the Board of Directors.

2017 Executive Incentive Plan — During 2017, the shareholders approved the 2017 Executive Incentive Plan, which is available to eligible employees, directors, consultants and advisors of the Company and its affiliates. The plan allows for the granting of incentive stock options, nonqualified stock options, reload options, stock appreciation rights, and restricted stock representing up to 1,000,000 shares. The Plan is administered by the Compensation Committee of the Board of Directors.

~~During~~Effective January 30, 2020, the Company granted nonqualified options for 155,450 shares and 269,060 restricted stock units. The options granted had a fair value of $162,959 using the Black-Scholes option pricing model with the following assumptions: risk-free interest rate of 1.44%, expected dividend yield of 0%, expected volatility of 49.24% and expected term in years of from 1.00 to 2.92 years. The restricted stock units had a value of $538,120 based on the market value on the date of the grants and a weighted average vesting period of 0.75 years.

Compensation expense related to stock options and restricted stock for the three months ended ~~September 30, 2017~~March 31, was:

Compensation expense related to stock options and ~~2016, amortization expense, included~~restricted stock for the three months ended March 31, are reflected in ~~depreciation and amortization of~~the following captions within operating expenses ~~amounted to $22,550~~in the condensed consolidated statements of operations and ~~$24,499, respectively. During~~comprehensive loss:

The following summarizes the ~~nine~~Company’s stock option activity for the three months ended ~~September 30, 2017 and 2016, amortization expense, included in depreciation and amortization of operating expenses, amounted to $70,359 and $73,497, respectively.~~March 31, 2020:

~~At September 30, 2017, future annual estimated amortization expense is summarized as follows:~~

The following summarizes the Company’s restricted stock unit activity for the three months ended March 31, 2020:

~~For the Three and Nine Months Ended September 30, 2017 and 2016, and as of September 30, 2017 and December 31, 2016~~

The Company ~~operates~~recognizes revenue as ~~a single segment~~services are performed or products are delivered and generally recognize revenue for the gross amount of consideration received as we are generally the primary obligor (or principal) in our contracts with customers as we hold complete responsibility to the customer for contract fulfillment. We record amounts collected from customers for sales tax on a ~~worldwide basis through its subsidiaries, resellers and independent sales agents. Gross revenues and~~ net ~~non-current tangible assets on a domestic and international basis~~basis.

Disaggregation of Revenue — The disaggregation of revenue for the three months ended March 31, is as follows:

~~Major customers -~~ During the three months ended September 30, 2017, two customers represented at least 10% of revenues, each accounting for 12% of revenues. During the three months ended September 30, 2016, two customers accounted for at least 10% of revenues, each accounting for 11% of revenues. During the nine months ended September 30, 2017, and 2016, no customers represented at least 10% of revenues.

As of September 30, 2017, one customer represented at least 10% of accounts receivable, accounting for 11% of accounts receivable. As of December 31, 2016, two customers represented at least 10% of accounts receivable, accounting for 22% and 10% of accounts receivable.

~~Vendor concentrations -~~ During the three months ended September 30, 2017, two vendors represented at least 10% of costs of revenue, accounting for 23% (a 1.9% shareholder) and 11% of the combined cost of revenues and change in inventory. During the nine months ended September 30, 2017, two vendors represented at least 10% of costs of revenue, accounting for 18% (a 1.9% shareholder) and 11% of the combined cost of revenues and change in inventory. During the three months ended September 30, 2016, three vendors represented at least 10% of costs of revenue, accounting for 26%, 16% (BioHiTech International, a 10% shareholder) and 11% of the combined cost of revenues and change in inventory. During the nine months ended September 30, 2016, three vendors represented at least 10% of costs of revenue, accounting for 43% (BioHiTech International, a 10% shareholder), 19% and 10% of the combined cost of revenues and change in inventory.

As of September 30, 2017, two vendors represented at least 10% of accounts payable, accounting for 27% and 19% (BioHiTech International, a 10% shareholder) of accounts payable. As of December 31, 2016, two vendors represented at least 10% of accounts payable, accounting for 32% (a 1.9% shareholder) and 21% of accounts payable.

~~For the Three and Nine Months Ended September 30, 2017 and 2016, and as of September 30, 2017 and December 31, 2016~~

Related parties include Directors, Senior Management Officers, and shareholders, plus their immediate family, who own a 5% or greater ownership interest at the time of a transaction. The table below presents direct related party assets and liabilities and other transactions or conditions as of or during the periods indicated.

~~The table below presents direct related party expenses or transactions for the periods indicated. Compensation and related costs for employees of the Company are excluded from the table below.~~

~~For the Three and Nine Months Ended September 30, 2017 and 2016, and as of September 30, 2017 and December 31, 2016~~

~~Series B Unsecured Subordinated Convertible Promissory Notes –~~During the fourth quarter of 2016 and the first quarter of 2017, the Company entered into a series of Securities Purchase Agreements (the “Purchase Agreement”) with certain accredited investors (the “Investors”), pursuant to which the Company agreed to sell and the Investors agreed to purchase in a private placement offering (the “Private Placement”) units (the “Units”) in the aggregate offering amount of $650,000, including $500,000 who were also shareholders and officers of the Company.

~~Convertible Note –~~ Effective March 30, 2017 the Company entered into a Securities Purchase Agreement, a Convertible Note with a maximum funding amount of $550,000 and Warrants with Vista Capital Investments LLC (“Vista”). As of March 31, 2017, in exchange for $100,000, Vista received a $110,000 face value note, which included a beneficial conversion feature valued at $4,014, a warrant for 24,750 shares of common stock valued at $16,043 utilizing the Black–Scholes–Merton model utilizing a stock price of $2.954 on the date of the grant, an exercise price of $4.00, a standard deviation (volatility) of 31.43%, a risk-free interest rate of 2.88% with a term of 5 years. As of June 26, 2017, in exchange for an additional $100,000, the face value note outstanding was $220,000; this additional $100,000 funding also included a beneficial conversion feature valued at $1,930, a warrant for 24,750 shares of common stock valued at $16,360 utilizing the Black–Scholes–Merton model utilizing a stock price of $2.98 on the date of the grant, an exercise price of $4.00, a standard deviation (volatility) of 31.43%, a risk-free interest rate of 2.88% with a term of 5 years.Risk Concentrations

The ~~note allows for fundings representing up~~Company operates as a single segment on a worldwide basis through its subsidiaries, resellers and independent sales agents. Gross revenues and net non-current tangible assets on a domestic and international basis are as follows:

Credit risk — Financial instruments that potentially subject the Company to ~~$550,000~~concentrations of credit risk consist primarily of cash and accounts receivable.

The Company minimizes credit risk associated with cash by periodically evaluating the credit quality of its primary financial institutions. At times, the Company’s cash may be uninsured or in ~~original principal amount notes with interest at 9.5%, of which $220,000 is outstanding as of September 30, 2017. Each funding matures~~deposit accounts that exceed the Federal Deposit Insurance Corporation (“FDIC”) in ~~seven months from~~ the ~~time of~~USA and the ~~funding, accordingly~~Financial Conduct Authority (“FCA”) in the ~~funding of~~UK insurance limits. Through March 31, ~~2017 matures on October 31, 2017 and the funding of June 26, 2017 matures January 26, 2018. The note is convertible into common shares of~~2020, the Company at $2.85 per share at any time there is an outstanding balance. In the event that the note is in default, the conversion price will equal 65% of the lowest closing price occurring during 25 consecutive trading days immediately preceding the conversion date. Events of default include: failure to pay the holder of the note any amount outstanding, a failure to convert shares exercised, any bankruptcy or bankruptcy-like actions againsthad not experienced losses on these accounts and management believes the Company ~~defaults~~is not exposed to significant risks on other obligations, a suspension of trading of the Company’s common stock, loss of DTC eligible status, delinquent Securities & Exchange Commission (“SEC”) filings, failure to reserve and keep available up to four times the full number of shares into which the note is convertible and the inability of the Company top comply with the provisions of SEC Rule 144.

During the third quarter of 2017, the holder exercised 24,750 warrants in a cashless exercise, resulting in the issuance of 14,093 shares of common stock. As of September 30, 2017 the holder has warrants outstanding that provide for the acquisition of up to 24,750 share of common stock at $4.00 per share and expire in five years from the date of issuance.such accounts.

~~Series C Convertible Notes and Warrants -~~Major customers From May 24, 2017 through August 11, 2017, the Company entered into a series of Securities Purchase Agreements (the “Purchase Agreement”) with certain accredited investors (the “Investors”), pursuant to which the Company agreed to sell and the Investors agreed to purchase units (the “Units”) in the aggregate offering amount of $1,250,000. The aggregate offering amount included $640,000 from the Company’s Chief Executive Officer, of which, in the third quarter, $190,000 were assigned to a third party at their original cost. Each Unit, in the minimum subscription amount of $100,000 is comprised of an Original Issue Discount Convertible Promissory Note (the “Note,” collectively, the “Notes”) and warrants (the “Warrants”) to purchase shares of the Registrant’s common stock, par value $0.0001 per share (the “Common Stock”). Each Note bears interest at the rate of 3.5 % per annum, has been issued with an original issue discount of 10% and is due on May 24, 2018 (the “Maturity Date”). The Notes are secured by any proceeds received by the Registrant from its investments in Entsorga West Virginia, LLC and Apple Valley Waste Conversions, LLC, (“AVWC”) and the membership interests in AVWC. The Notes are convertible at the option of the Investors, at any time up to and including the Maturity Date, into shares of Common Stock equal to the outstanding principal amount under the Note, plus any accrued and unpaid interest, divided by a conversion price (the “Conversion Price”) equal to $3.00 per share. The Warrants are exercisable for a period of five years into a number of shares of Common Stock equal to 50% of the number of shares of Common Stock into which the Notes are convertible at an exercise price equal to $3.75 per share. The Purchase Agreement also provides the Investors the right to participate in up to 20% of the future external financing for the Registrant’s equity investment in up to six future High Efficiency Biological Treatment (HEBioT) facilities. The Purchase Agreement contains customary representations, warranties and covenants of the Registrant and the Investors for like transactions.

~~For the Three and Nine Months Ended September 30, 2017 and 2016, and as of September 30, 2017 and December 31, 2016~~

As of September 30, 2017, the Notes reflect: face amount of $1,250,000, net of original issue discount of $125,000, bifurcated warrants of $151,584, bifurcated beneficial conversion feature of $138,240, net of amortization of discounts of $104,010. The warrants for 208,334 shares of common stock were valued utilizing the Monte Carlo modelling technique utilizing stock prices of $3.05 to $7.50 on the dates of the grant, an exercise price of $3.75, a standard deviation (volatility) of 31.1% to 33.2% based on the date of issue, a risk-free interest rate of 2.62% to 2.79% based on the date of issue with a term of 5 years. The model includes subjective input assumptions that can materially affect the fair value estimates. Conversion options are recorded as debt discounts and are amortized as interest expense over the life of the underlying debt instrument.

~~Series D Convertible Notes and Warrants –~~During the third quarter of 2017, the Company entered into a series of Securities Purchase Agreements (the “Purchase Agreement”) with twenty one accredited investors (the “Investors”), pursuant to which the Company agreed to sell and the Investors agreed to purchase units (the “Units”) in the aggregate offering amount of $2,000,000, including $140,000 of payment in kind. Units aggregating $325,000 were with related parties. Each Unit is comprised of a mandatorily Convertible Promissory Note (the “Note”) and Warrants (the “Warrants”) to purchase shares of the Registrant’s common stock, par value $0.0001 per share (the “Common Stock”). Prior to maturity, an Investor may elect, at its option and in its sole discretion, to convert all or a portion of the outstanding principal amount under the Note, plus any accrued and unpaid interest, into a number of shares of Common Stock at a conversion price equal to $2.75 per share. Each Note bears interest at the rate of 8% per annum and is due on the earlier of: (i) July 6, 2019; (ii) the date the Common Stock is listed on The Nasdaq Stock Market or NYSE MKT (the “Listing”); or (iii) a “Change of Control” of the Registrant which is defined as a liquidation, dissolution, winding up, change in voting control, or sale of all or substantially all of the Registrant’s assets (the “Maturity”). At Maturity, each Note is convertible into shares of Common Stock equal to the outstanding principal amount under the Note, plus any accrued and unpaid interest, divided by a conversion price (the “Conversion Price”) equal to the lowest of: (i) the trading price on the date of the Listing; (ii) the price per share paid by investors in a subsequent underwritten public offering in connection with the Listing; (iii) the lowest price paid by investors in a subsequent offering of the Registrant’s securities; (iv) the per share price in a Change of Control transaction; or (v) $2.75 per share. The Warrants are exercisable for a period of five years into a number of shares of Common Stock equal to the number of shares of Common Stock into which such Investor’s Note is convertible at an exercise price equal to 120% of the Conversion Price.

The embedded conversion feature and warrants issued in the transaction are not indexed to the Company’s common stock. However, the embedded conversion feature and warrants did not meet the definition of a derivative and therefore such conversion feature was not bifurcated from the underlying note payable and the warrants were not recorded as a derivative liability.

~~Maturities of Promissory Notes, Convertible Notes, Long Term Debt and Unsecured Subordinated Convertible Notes –~~ ~~as of September 30, 2017, excluding discounts and deferred finance costs, which are being amortized as interest expense, are as follow:~~

* Certain non-amortizing notes are subject to earlier event based maturities. The table above presents all non-amortizing notes at their time period based maturity condition.

~~Interest Expense -~~ All interest on the Company’s various debts, including coupon and amortization of discounts and deferred financing costs are recognized as interest expense in the accompanying consolidated financial statements.

~~For the Three and Nine Months Ended September 30, 2017 and 2016, and as of September 30, 2017 and December 31, 2016~~

~~Shareholder Information and Marketing Agreement –~~During 2016, the Company entered into a service agreement for an initial three-month term, subject to a termination option after the initial 30-day period. In addition to monthly cash fees, the Company will issue 8,000 shares of restricted common stock that will vest over the three-month period.— During the three months ended March 31, ~~2017, 3,200 shares were earned~~2020, one customer represented at ~~a cost~~least 10% of ~~$8,053. During 2016, 4,800 shares were earned with a related cost~~revenues, accounting for 35.9% (Gold Medal Group, LLC, an affiliated entity, “GMG”) of $12,952. The costs reflect the vesting of such shares based upon the daily closing prices of the Company’s common stock and reflected as professional fees and an increase to additional paid in capital. The 8,000 shares were issued in the second quarter of 2017.

~~Shareholder Awareness Consulting Agreement –~~ During 2017, the Company entered into a ninety-day consulting agreement for shareholder awareness. The contract provided for 100,000 shares of the Company’s restricted common stock that will vest over the ninety-day period.revenues. During the three months ended March 31, ~~2017 and~~2019, one customer represented at least 10% of revenues, accounting for 34.6% (GMG).

As of March 31, 2020 one customer represented at least 10% of accounts receivable, accounting for 74.8% (GMG) of accounts receivable. As of December 31, 2019 one customer represented at least 10% of accounts receivable, accounting for 58.9% (GMG) of accounts receivable.

Vendor concentration — During the three months ended ~~June 30, 2017, 89,063 shares were earned~~March 31, 2020, one vendor represented at aleast 10% of costs of revenue, accounting for 24.5% (GMG). During the three months ended March 31, 2019, no vendors represented at least 10% of the combined cost of ~~$267,094,~~revenues.

As of March 31, 2020, excluding construction payables and ~~10,937 shares were earned~~other professional fees, one vendor represented at least 10% of accounts payable accounting for 45.5% (GMG) of accounts payable. As of December 31, 2019, one vendor represented at least 10% of accounts payable accounting for 54.4% (GMG) of accounts payable.

Affiliate relationship — GMG owns a ~~cost of $35,274, respectively. The Contract also provided for the granting of~~40% interest in Refuel America, LLC, a ~~warrant for 100,000 shares of common stock. The warrant was initially valued at $105,188 utilizing the Black–Scholes–Merton model utilizing a stock price of $3.00 on the date~~consolidated subsidiary of the ~~initial estimation of the liability~~Company. GMG’s subsidiaries, which are not consolidated in the ~~second quarter of 2017 utilizing~~Company’s financial statements have several business relationships with the Black–Scholes–Merton model utilizing, an exercise price of $2.75, a standard deviation (volatility) of 31.11%, a risk-free interest rate of 2.75% with a term of 5 years. The costs reflect the vesting of such shares based upon the daily closing prices of the Company’s common stockCompany and ~~the estimated valuation of the warrant, which are reflected as professional fees~~its subsidiaries that result in revenues and ~~an increase to additional paid in capital. During the second quarter of 2017, the warrant was issued~~expenses noted above. See Note 14. Related Party Transactions.

Note 12. Commitments and ~~the valuation at the time of issuance resulted in a $1,999 change in the fair value of the warrant, which has been expensed as a non-operational expense.~~Contingencies

During the ~~third quarter of 2017,~~three months ended March 31, 2020 the Company was involved in the following legal matters.

On February 7, 2018, Lemartec Corporation (“Lemartec”) filed a complaint against the Company in the United States District Court for the Northern District of West Virginia arising out of the construction of the Company’s resource recovery facility in Martinsburg, West Virginia alleging breach of contract and unjust enrichment. The Company has filed its answer and counterclaims for damages against Lemartec and cross claims against Lemartec’s performance bond surety, Philadelphia Indemnity Insurance Company. The trial was scheduled to begin in August 2020. Prior to the ~~consultant agreed to new terms to extend~~start of the ~~contract through~~trial, on March 12, 2020 the Company entered into a settlement agreement that detailed the full and final mutual release. The settlement agreement provides that the Company pay Lemartec $775,000 in installments of $475,000 within 60 days of the execution of the settlement agreement and $25,000 each month thereafter for 12 months. The Company’s consolidated financial statements as of December 31, ~~2017. Under~~2019 reflects this liability given the ~~terms~~nature of the ~~extension, in addition~~subsequent event.

It is management’s opinion that the resolution of this known claim will not materially affect the Company’s future financial position, results of operations, or cash flows.

From time to ~~cash fees,~~time, the Company ~~agreed to grant~~may be involved in other legal matters arising in the ~~consultant an additional 75,000 shares that will be earned over the term~~ordinary course of the contract, from the date that the initial contract expired. During the second quarter of 2017, the consultant has earned 34,884 shares with a cost of $102,670, which has been reflected as professional fees and an increase to additional paid in capital. During the third quarter of 2017, the consultant has earned 40,116 shares with a cost of $233,508, which has been reflected as professional fees and an increase to additional paid in capital.

~~During the second quarter of 2017,~~business. While the Company ~~issued 100,000 share of earned common stock in connection with the agreements. During the third quarter of 2017, the Consultant exercised 100,000 warrants in a cashless exercise, resulting~~believes that such matters are currently not material, there can be no assurance that matters arising in the ~~issuance~~ordinary course of ~~70,044 shares of common stock.~~

~~Series A and B Warrants –~~ ~~In connection with the issuance of Series A, B and D units, which included convertible debt and warrants that are exercisable~~business for a period of five years into shares of common stock equal to the number of shares of common stock into which the notes are convertible at an exercise price equal to 120% of the conversion price of the notes. The embedded conversion feature and warrants issued in the transaction are not indexed to the Company’s common stock. However, the embedded conversion feature and warrants did not meet the definition of a derivative and therefore such conversion feature was not bifurcated from the underlying note payable and the warrants were not recorded as a derivative liability.

~~Maxim Warrants -~~ In connection with the issuance of the Series A Units, the Company agreed to issue warrants to Maxim Group LLC, the placement agent, that are exercisable into 10% of the total number of shares of common stock that the notes are convertible under the notes at an exercise price of $3.75 per share. The warrants expire 5 years from the date of issuance of the underlying notes. As the number of shares that the note holders will receive upon conversion is unknown, the number of shares into which the warrants apply is also unknown.

~~Barksdale Warrants -~~ In connection with an Offering in October 2013 the Company agreed to issue Barksdale Global Holdings, LLC (“Barksdale”) warrants. These warrants were issued on June 30, 2015 to purchase up to $140,000 of Common Interests (as converted to common stock) on or before the expiration date of June 30, 2020. The warrant is exercisable following the completion of an equity raise with financial institutions or accredited investors in which the Company ~~receives gross proceeds~~is, or could be, involved in litigation, will not have a material adverse effect on its business, financial condition or results of ~~a minimum of $5.0 million. If the Company does not consummate a Qualified Financing prior to the expiration date, the warrant shall never be exercisable.~~

~~Other Warrants -~~ In connection with prior debt offerings that have been converted into equity, warrants expiring between May and July of 2020 representing an $80,000 purchase equity interest remain outstanding. The warrants allow the holders to acquire up to $80,000 of the Company’s common stock at a price of 120% of the closing price of the Company’s first issuance of equity in one, or a series of related transactions, through which the Company receives gross proceeds of $5.0 million or more from one or more financial institutions or accredited investors. If the Company does not consummate a Qualified Financing prior to the expiration date, the warrant shall never be exercisable.

~~For the Three and Nine Months Ended September 30, 2017 and 2016, and as of September 30, 2017 and December 31, 2016~~operations

Effective January 1, 2019, the Company ~~established~~implemented Accounting Standards Codification 842, Leases. The Company utilized the ~~BioHiTech Global, Inc. 2015 Equity Incentive Plan, which is available~~optional transition method to ~~eligible employees, directors, consultants~~assess the impact of this guidance on the Company’s financial statements and ~~advisors~~related disclosures, including the increase in the assets and liabilities on our balance sheet from lessee perspective. The Company completed a comprehensive review of its leases that were impacted by the new guidance. As part of the Company and its affiliates. The plan allows for the granting of incentive stock options, nonqualified stock options, reload options, stock appreciation rights, and restricted stock representing up to 750,000 shares. The Plan is administered by the compensation committee of the board of directors. Effective March 1, 2016,adoption, the Company ~~granted nonqualified options for 371,250 shares. Effective April 15, 2016,~~elected the ‘package of practical expedients,’ which permits the Company ~~granted 347,500 restricted stock units. As of September 30, 2017, there were 86,596 shares available~~not to reassess under the ~~Plan for future grants. There have been no grant awards made during~~new standard the ~~nine months ended September 30, 2017. Compensation expense related to~~Company’s prior conclusions about lease identification, lease classification and initial direct costs, therefore the ~~options and restricted stock units was:~~Company did not restate prior comparative periods.

The ~~following table summarizes~~Company rents its headquarters and attached warehousing space from a related party (see Note 14) and has a land lease relating to the ~~Company’s stock option activity~~Martinsburg, WV HEBioT facility under operating leases. The HEBioT facility land lease has an initial term of 30 years, plus four 5-year extensions. For purposes of our determination of lease liabilities, extensions were not included. As the leases do not provide an implicit rate, the Company used incremental borrowing rates in determining the present value of lease payments. For the HEBioT facility land lease a rate of 11% was utilized and a rate of 10.25% was used on the other leases. The current portion of the lease liabilities of $121,510 is included in accrued expenses and liabilities. Total lease costs under operating leases amounted to $55,356 and $67,532 for the ~~nine~~three months ended ~~September 30, 2017:~~March 31, 2020 and 2019, respectively. Maturities of lease liabilities under these leases, which have a weighted average remaining term of 25.6 years, as of March 31, 2020 is:

The ~~following table summarizes the Company’s restricted stock unit activity~~Company operating cash flows for operating leases amounting to $51,406 and $46,034 for the ~~nine~~three months ended ~~September 30, 2017:~~

At the Annual Shareholders Meeting on June 7, 2017 the shareholders approved the 2017 Executive Incentive Plan that allows for the granting of awards for up to 1,000,000 shares of the Company’s common stock. No grants under the plan have been made as of September 30, 2017.

~~BioHiTech Global, Inc.~~March 31, 2020 and ~~Subsidiaries~~2019, respectively.

~~For the Three and Nine Months Ended September 30, 2017 and 2016, and as of September 30, 2017 and December 31, 2016~~

Related parties include Directors, Senior Management Officers, and ~~Contingencies~~shareholders, plus their immediate family, who own a 5% or greater ownership interest at the time of a transaction. Related parties also include GMG and its subsidiaries as a result of its 40% interest in Refuel America, LLC (“Refuel”), a consolidated entity of the Company.

During 2018 GMG acquired as regional waste management entity, Apple Valley Waste (“AVW”), with operations located in West Virginia, Maryland and Pennsylvania. As part of this acquisition, GMG also acquired AVW’s interests in EWV that were contributed to ~~time,~~Refuel. Prior to GMG’s acquisition of AVW and the ~~Company is involved~~Company’s investments and control acquisition of EWV, in ~~legal matters arising in~~order for EWV to receive the ~~ordinary course of business, including matters that relate to items for which~~proceeds from the ~~Company has accrued their contractual obligations, but are disputing payment for. The Company has one such matter~~Entsorga West Virginia, LLC WVEDA Non-Recourse Solid Waste Disposal Revenue Bonds, EWV and AWV had entered into several agreements relating to ~~a professional~~business services, agreement in litigation that it believes does not present a material risk to the Company. While the Company believes that these such matters are currently not material, there can be no assurance that matters arising in the ordinary course of business for which the Company is, or could be, involved in litigation, will not have a material adverse effect on its business, financial condition or results of operations.solid waste delivery and disposal.

The ~~Company rents its headquarters and attached warehousing space from a~~table below presents the face amount of direct related party ~~(see Note 11)~~assets and ~~their research~~liabilities and development office from an unrelated party under operating leases. The research and development office lease commenced in October 2015 and will expire in 2018, subject to one renewal option for an additional one-year period. The total future minimum lease payments under these leasesother transactions or conditions as of ~~September 30, 2017 is:~~or during the periods indicated.

~~Total rent expense under all operating leases amounted to $39,921 and $31,645~~The table below presents direct related party expenses or transactions for the three months ended ~~September 30, 2017~~March 31,2020 and ~~2016, respectively. Total rent expense under all~~2019. Compensation and related costs for employees of the Company are excluded from the table below.

Advances from Related Parties - The Company’s Chief Executive Officer (the “Officer”) on occasion advances the Company funds for operating ~~leases amounted to $105,702~~ and ~~$101,078 for~~capital purposes. The advances bear interest at 13% and are unsecured and due on demand. During the ~~nine~~three months ended ~~September 30, 2017~~March 31,2020 the Officer advanced $1,000,000 to the Company. There are no financial covenants related to this advance and ~~2016, respectively.~~there are no formal commitments to extend any further advances. In addition, during the three months ended March 31, 2020 another officer advanced $200,000 to the Company.

Note ~~17.~~15. Supplemental ~~Consolidated~~Consolidated Statement of Cash Flows Information

Changes in non-cash operating assets and liabilities, as well as other supplemental cash flow disclosures for the three months ended March 31, are as ~~follows:~~follows.

	2020			2019
Changes in operating assets and liabilities:
Accounts receivable	$	(324,890	)	$	48,266
Inventory		31,981			76,930
Prepaid expenses and other assets		(25,989	)		(36,508	)
Accounts payable		672,061			3,088,732
Accrued interest payable		(525,392	)		(399,764	)
Accrued expenses		(9,591	)		(2,668,827	)
Deferred revenue		11,977			12,142
Customer deposits		(38,000	)		4,351
Net change in operating assets and liabilities	$	(207,843	)	$	125,322

Supplementary cash flow information:
Cash paid during the periods for:
Interest	$	1,387,402		$	1,082,526
Income taxes		-			-

~~For the Three and Nine Months Ended September 30, 2017 and 2016, and as of September 30, 2017 and December 31, 2016~~

~~During the nine months ended September 30, 2017, the Company implemented the following recent accounting pronouncements:~~

~~Stock Compensation -~~ In March 2016, FASB issued ASU No. 2016-09, “Compensation - Stock Compensation: Improvements to Employee Share-Based Payment Accounting” (Topic 718). The amendments in this ASU is to significantly reduce the complexity and cost of accounting for excess tax benefits and tax deficiencies related to employee share-based payment transactions, which include restricted stock and stock options. Also, ASU No. 2016-09 requires an entity to run excess tax benefits and deficiencies through its income statement, which in effect eliminates the concept of additional paid-in capital. This new guidance was implemented during the first quarter of 2017 and its implementation did not have a material impact on the financial statements.

~~Inventory -~~ In July 2015, the FASB issued ASU No. 2015-11, “Inventory (Topic 330): Simplifying the Measurement of Inventory” (“ASU 2015-11”). ASU 2015-11 requires inventory measured using any method other than last-in, first out (“LIFO”) or the retail inventory method to be subsequently measured at the lower of cost or net realizable value, rather than at the lower of cost or market. This new guidance was implemented during the first quarter of 2017 and its implementation did not have a material impact on the financial statements.

~~Statement of Cash Flows –~~~~In August 2016, the FASB issued Accounting Standards Update No. 2016-15,~~ ~~Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments~~ ~~(“ASU 2016-15”). The update amends the guidance in Accounting Standards Codification 230,~~ ~~Statement of Cash Flows~~~~, and clarifies how entities should classify certain cash receipts and cash payments on thestatementof cash flows with the objective of reducing the existing diversity in practice related to eight specific cash flow issues.The Company elected to early adopt this new guidance during the first quarter of 2017 and its implementation did not have a material impact on the financial statements.~~

~~Accounting for Certain Financial Instruments with Down Round Features -~~ In July 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2017-11—Earnings Per Share (Topic 260), Distinguishing Liabilities From Equity (Topic 480), and Derivatives and Hedging (Topic 815): I. Accounting for Certain Financial Instruments with Down Round Features and II. Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. ASU 2017-11 eliminates the requirement that a down round feature precludes equity classification when assessing whether an instrument is indexed to an entity’s own stock. A freestanding equity-linked financial instrument no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. The effective date for ASU 2017-11 is for annual or any interim periods beginning after December 15, 2018. Early adoption is permitted. The Company implemented this ASU on a retrospectively basis as of January 1, 2017 and April 1, 2017. Since there was no reduction of the conversion price and exercise price of the warrants associated with the Notes, there is no impact upon implementation of ASU 2017-11 to the condensed consolidated financial statements.

~~The Company has not yet implemented the following recent accounting pronouncements:~~

~~Revenue from Contracts with Customers -~~ In April 2016, the FASB issued Accounting Standards Update (“ASU”) No. 2016-10, “Revenue from Contracts with Customers - Identifying Performance Obligations and Licensing” (Topic 606). The amendments clarify two aspects of ASU No. 2014-09, “Revenue from Contracts with Customers,” by providing (1) guidance for identifying performance obligations and (2) licensing implementation guidance. Public business entities should apply the guidance similar to Update 2014-09 to annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Earlier application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) ASU No. 2014-09, “Revenue from Contracts with Customers” (ASU 2014-09). ASU 2014-09 provides guidance for revenue recognition and affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets and supersedes the revenue recognition requirements in Topic 605, “Revenue Recognition,” and most industry-specific guidance. The core principle of ASU 2014-09 is the recognition of revenue when a company transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. ASU 2014-09 defines a five-step process to achieve this core principle and, in doing so, companies will need to use more judgment and make more estimates than under the current guidance. These may include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. ASU 2014-09, as amended, is effective for fiscal years beginning after December 15, 2017 and interim periods therein, using either of the following transition methods: (i) a full retrospective approach reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients, or (ii) a retrospective approach with the cumulative effect of initially adopting ASU 2014-09 recognized at the date of adoption (which includes additional footnote disclosures). The Company does not anticipate that the adoption, by means of a retrospective approach with a cumulative effect, if any, will have a material effect on its consolidated financial position or results of operations.

~~For the Three and Nine Months Ended September 30, 2017 and 2016, and as of September 30, 2017 and December 31, 2016~~

~~Leases -~~ ~~In February 2016, the FASB issued new lease accounting guidance (ASU No. 2016-02,~~~~Leases).~~ Under the new guidance, at the commencement date, lessees will be required to recognize a lease liability, which is a lessee‘s obligation to make lease payments arising from a lease, measured on a discounted basis; and a right-of use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. The new guidance is not applicable for leases with a term of 12 months or less. Lessor accounting is largely unchanged. Public business entities should apply the amendments in ASU 2016-02 for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early application is permitted upon issuance. Lessees (for capital and operating leases) and lessors (for sales-type, direct financing, and operating leases) must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The modified retrospective approach would not require any transition accounting for leases that expired before the earliest comparative period presented. Lessees and lessors may not apply a full retrospective transition approach. The Company will evaluate the effects, if any, that adoption of this ASU will have on its consolidated financial position or results of operations.

The Company evaluates subsequent events and transactions that occur after the balance sheet date up to the date that the financial statements are available to be issued. Any material events that occur between the balance sheet date and the date that the financial statements were available for issuance are disclosed as subsequent events, while the financial statements are adjusted to reflect any conditions that existed at the balance sheet date. Based upon this review, except as disclosed within the footnotes or as discussed below, the Company did not identify any recognized or non-recognized subsequent events that would have required adjustment or disclosure in the financial statements.

~~Acquisition of Intellectual Property License for 165,000 ton MBT Facility in development~~ – On ~~November 1, 2017, BioHiTech Global, Inc.~~January 30, 2020 the Chief Executive Officer and ~~its wholly-owned subsidiary E.N.A. Renewables LLC, entered into a Technology License Agreement (the “License Agreement”) with Entsorgafin S.p.A. (“Entsorga”) whereby~~another officer advanced $1,050,000 and $200,000 to the Company, ~~acquired a license for~~which the ~~design, development construction, installation~~Company repaid $275,000 and operation of a High Efficiency Biological Treatment (“HEBioT”) renewable waste facility with a capacity of 165,000 tons per year. The patented HEBioT technology converts mixed municipal and organic waste to a US Environmental Protection Agency recognized alternative fuel source.

The royalty payment for the license amounted to $6,019,200, which was comprised of 1,035,905 shares (the “Shares”) of the Company’s common stock, par value $0.0001 per share and cash in an amount up to $839,678.40 for payment of Entsorga’s withholding taxes in the Unites States and Italy.$200,000 on April 27, 2020, respectively.

The Company ~~also entered into a Registration Rights Agreement with Entsorga whereby~~has applied for funds under the Paycheck Protection Program in May 2020 for one of its subsidiaries. The application for these funds requires the Company ~~granted Entsorga certain piggy-back~~to, in good faith, certify that the current economic uncertainty made the loan request necessary to support the ongoing operations of the Company. This certification further requires the Company to take into account its current business activity and ~~demand registration rights with respect~~its ability to access other sources of liquidity sufficient to support ongoing operations in a manner that is not significantly detrimental to the ~~Shares.~~business. The application amounting to $421,300 was approved and was funded on May 13, 2020. The forgiveness of the loan attendant to these funds, is dependent on the Company qualifying for the forgiveness of such loan based on its future adherence to the forgiveness criteria.

~~Series A Preferred Stock –~~On ~~October 30, 2017,~~April 6, 2020 the Company entered into a Securities Purchase Agreements (the “Purchase Agreement”) with a single, accredited investor (the “Investor”), pursuant to which the Company agreed to sell and the Investor agreed to purchase up toclosed on an ~~aggregate of 333,401~~additional $65,000 on 566 shares of the ~~Company’s newly created~~ Series ~~A Convertible Preferred Stock, par value $0.0001 per share (the “Series A Shares”) for an aggregate investment~~F of ~~up to $1,667,000 for the aggregate purchase price up to $1,500,300. In addition,~~preferred stock and 7,750 common stock warrants.

Effective April 1, 2020 the Company and GMG mutually agreed to ~~issue warrants (the “Warrants”) to purchase up to 333,401 shares of~~reduce the Company’s common stock, par value $0.0001 per share (the “Common Stock”) at the exercise price of $5.00 per share. At the first closing, consummated on October 31, 2017 (the “First Closing”) the Investor purchased 133,334 shares of Series A Sharesscope and ~~Warrants to purchase an additional 133,334 shares of Common Stock for a purchase price of $600,000. The Company, assuming~~ its ~~satisfaction of certain conditions, has the option to sell~~annual fee related to the ~~Investor an additional 200,067 Series A Shares and Warrants~~management agreement in place from $300,000 to ~~purchase 200,067 shares of Common Stock for the purchase price of $900,300, thirty days after the First Closing.~~$100,000 per year.

The ~~Series A Shares~~WVEDA Solid Waste Disposal Revenue Bond obligations of Entsorga West Virginia LLC are convertible into share of Common Stock at the rate of one share of Common Stock for $5.00 of stated value of Series A Shares converted (effectively, on a 1 for 1 basis). The conversion rate is subject to adjustment for stock splits, reclassification and issuance of certain Securities at a purchase price per share below the conversion price. The Series A Shares will automatically convert into Common Stock ifnot guaranteed by its members, including the Company, ~~(i) receives gross proceeds~~however the membership interests of ~~$6,000,000 or (ii) receives gross proceeds sufficient to qualify for listing on a natural securities exchange. If~~Entsorga West Virginia LLC are pledged, and the ~~Company completes a financing at a price per share of less than $5.00, one-half of the Series A Shares will convert at a conversion price equal~~debt agreements provide restrictions prohibiting distributions to the purchase price of such financing. The Series A Shares are entitled to receive dividends, payable quarterly commencing December 31, 2017, at the rate of five percent (5%) during the first year of issuance, and increasing two percent (2%) per month thereafter. The Series A Shares rank seniormembers, including equity distributions or providing loans or advances to the Company’s Common Stock with respect to dividends, distributions and payments on liquidation. The Registrant also has the right to redeem the Series A Shares one year after the First Closing for 120% of the stated value plus any unpaid dividends. Commencing on June 1, 2019, the Investor will have the right to require the Company to redeem the Series A Shares for 115% of the Conversion Amount, under certain circumstances.members.

~~For~~The following pages present the ~~Three and Nine Months Ended September 30, 2017 and 2016, and~~Company’s consolidating balance sheet as of ~~September 30, 2017~~March 31, 2020 and December 31, ~~2016~~

~~The~~2019 and its condensed consolidating statements of operations and cash flows for the three months ended March 31, 2020 and 2019, for Entsorga West Virginia LLC and the Parent consolidated with other Company ~~also granted the Investor certain piggy-back registration rights with respect~~subsidiaries not subject to the ~~shares of Common Stock underlying the conversion of the Series A Shares~~WVEDA Solid Waste Disposal Revenue Bond restrictions and the ~~exercise of the Warrants.~~

~~Conversion of Debt into Common Stock –~~ ~~During October 2017, Vista Capital Investments LLC converted $110,000 of~~elimination entries necessary to present the Company’s ~~convertible notes, plus accrued interest, into 40,454 shares of common stock.~~

~~Investor Awareness Contract –~~ ~~Effective October 2, 2017~~financial statements on a consolidated basis. The following condensed consolidating financial information should be read in conjunction with the Company entered into a new shareholder awareness consulting agreement with its existing consultant. This agreement has a term of 90 days and includes cash fees of $90,000, the issuance of the 35,000 shares of common stock and warrants to purchase 10,000 shares of common stock at $5.00 per share.Company's consolidated financial statements.

Condensed Consolidating Balance Sheet as of March 31, 2020

	Parent and other Subsidiaries		Entsorga West Virginia LLC			Eliminations			Consolidated
Assets
Cash	$	1,917,803	$	17,043		$	-		$	1,934,846
Restricted cash		-		1,137,714			-			1,137,714
Other current assets		1,640,754		1,507,533			(123,459	)		3,024,828
Current assets		3,558,557		2,662,290			(123,459	)		6,097,388
Restricted cash		-		2,563,978			-			2,563,978
HEBioT facility and other fixed assets		1,682,271		36,951,832			-			38,634,103
Operating lease right of use assets		24,325		894,260			-			918,585
MBT facility development and license costs		6,278,938		1,764,000			-			8,042,938
Investment in subsidiaries and intercompany accounts		13,069,738		(2,450,776	)		(10,618,962	)		-
Goodwill		-		58,000			-			58,000
Other assets		48,849		-			-			48,849
Total assets	$	24,662,678	$	42,443,584		$	(10,742,421	)	$	56,363,841

Liabilities and stockholders’ equity
Line of credit	$	1,481,356	$	-		$	-		$	1,481,356
Current portion of Debts and Bonds		4,241,578		2,860,000			-			7,101,578
Other current liabilities		3,790,497		5,637,288			-			9,427,785
Current liabilities		9,513,431		8,497,288			-			18,010,719
Notes payable and other debts		962,011		-			-			962,011
Accrued interest		1,567,311		-			-			1,567,311
Non-current lease liabilities		-		916,973			-			916,973
WV EDA bonds		-		28,392,733			-			28,392,733
Total liabilities		12,042,753		37,806,994			-			49,849,747
Redeemable preferred stock		726,553		-			-			726,553
Stockholder’s equity:
Attributable to parent		1,264,636		-			-			1,264,636
Attributable to non-controlling interests		10,628,736		4,636,590			(10,742,421	)		4,522,905
Stockholders’ equity		11,893,372		4,636,590			(10,742,421	)		5,787,541
Total liabilities and stockholders’ equity	$	24,662,678	$	42,443,584		$	(10,742,421	)	$	56,363,841

Condensed Consolidating Statement of Operations for the three months ended March 31, 2020

	Parent and other Subsidiaries			Entsorga West Virginia LLC			Eliminations		Consolidated
Revenue	$	869,209		$	490,132		$	-	$	1,359,341
Operating expenses
HEBioT		-			812,427			-		812,427
Rental, service and maintenance expense		260,835			-			-		260,835
Equipment		146,404			-			-		146,404
Selling, general and administrative		1,668,780			249,643			-		1,918,423
Depreciation and amortization		124,733			490,469			-		615,202
Total operating expenses		2,200,752			1,552,539			-		3,753,291
Loss from operations		(1,331,543	)		(1,062,407	)		-		(2,393,950	)
Other (income) expenses, net		348,228			651,796			-		1,000,024
Net loss	$	(1,679,771	)	$	(1,714,203	)	$	-	$	(3,393,974	)

BioHiTech Global, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

For the Three and Months Ended March 31, 2020 and 2019 and as of March 31, 2020 and December 31, 2019

Condensed Consolidating Statement of Cash Flows for the three months ended March 31, 2020

	Parent and other Subsidiaries			Entsorga West Virginia LLC			Eliminations	Consolidated
Cash flows used in operating activities:
Net loss	$	(1,679,771	)	$	(1,714,203	)	$	$	(3,393,974	)
Non-cash adjustments to reconcile net loss to net cash used in operations		550,567			535,776				1,086,343
Changes in operating assets and liabilities		(1,433,781	)		1,225,938				(207,843	)
Net cash used in operations		(2,562,985	)		47,511				(2,515,474	)

Cash flow used in investing activities:
Purchases of construction in-progress, equipment, fixtures and vehicles		(2,649	)		(18,200	)			(20,849	)
Other investing activities		(24,509	)		-				(24,509	)
Net cash used in investing activities		(27,158	)		(18,200	)			(45,358	)

Cash flows from financing activities:
Issuances of debt and equity		2,695,450			-				2,695,450
Repayments of debt		(1,460	)		-				(1,460	)
Net cash provided by financing activities		2,693,990			-				2,693,990
Effect of exchange rate on cash		(33,572	)		-				(33,572	)
Cash – beginning of period (restricted and unrestricted)		1,847,526			3,689,426				5,536,952
Cash – end of period (restricted and unrestricted)	$	1,917,803		$	3,718,735		$	$	5,636,538

Condensed Consolidating Balance Sheet as of December 31, 2019

	Parent and other Subsidiaries		Entsorga West Virginia LLC		Eliminations			Consolidated
Assets
Cash	$	1,847,526	$	-	$	-		$	1,847,526
Restricted cash		-		1,133,581		-			1,133,581
Other current assets		1,697,910		1,116,821		(64,669	)		2,750,062
Current assets		3,545,436		2,250,402		(64,669	)		5,731,169
Restricted cash		-		2,555,845		-			2,555,845
HEBioT facility and other fixed assets		1,753,730		37,392,601		-			39,146,331
Operating lease right of use assets		48,021		897,026		-			945,047
MBT facility development and license costs		6,254,429		1,795,500		-			8,049,929
Investment in subsidiaries		10,864,783		-		(10,864,783	)		-
Goodwill		-		58,000		-			58,000
Other assets		53,726		-		-			53,726
Total assets	$	22,520,125	$	44,949,374	$	(10,929,452	)	$	56,540,047

Liabilities and stockholders’ equity
Line of credit	$	1,479,848	$	-	$	-		$	1,479,848
Current portion of WV EDA Bonds		-		1,390,000		-			1,390,000
Other current liabilities		2,387,916		6,475,985		(650,894	)		8,213,007
Current liabilities		3,867,764		7,865,985		(650,894	)		11,082,855
Notes payable and other debts		5,118,125		-		-			5,118,125
Accrued interest		1,510,193		-		-			1,510,193
Non-current lease liabilities		-		915,170		-			915,170
WV EDA bonds		-		29,817,426		-			29,817,426
Total liabilities		10,496,082		38,598,581		(650,894	)		48,443,769
Redeemable preferred stock		726,553		-		-			726,553
Stockholder’s equity:
Attributable to parent		2,024,143		-		-			2,024,143
Attributable to non-controlling interests		9,273,347		6,350,793		(10,278,558	)		5,345,582
Stockholders’ equity		11,297,490		6,350,793		(10,278,558	)		7,369,725
Total liabilities and stockholders’ equity	$	22,520,125	$	44,949,374	$	(10,929,452	)	$	56,540,047

BioHiTech Global, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

For the Three and Months Ended March 31, 2020 and 2019 and as of March 31, 2020 and December 31, 2019

Condensed Consolidating Statement of Operations for the three months ended March 31, 2019

	Parent and other Subsidiaries			Entsorga West Virginia LLC			Eliminations		Consolidated
Revenue	$	737,701		$	-		$		$	737,701
Operating expenses
Rental, service and maintenance expense		203,203			-			-		203,203
Selling, general and administrative		2,057,247			269,115			-		2,326,362
Depreciation and amortization		129,439			-			-		129,439
Total operating expenses		2,389,889			269,115			-		2,659,004
Loss from operations		(1,652,188	)		(269,115	)		-		(1,921,303	)
Other expenses		311,989			27,875			-		339,864
Net loss	$	(1,964,177	)	$	(296,990	)	$	-	$	(2,261,167	)

Condensed Consolidating Statement of Cash Flows for the three months ended March 31, 2019

	Parent and other Subsidiaries			Entsorga West Virginia LLC			Eliminations			Consolidated
Cash flows from operating activities:
Net loss	$	(1,964,177	)	$	(296,990	)	$	-		$	(2,261,167	)
Adjustments to reconcile net loss to net cash used in operations		892,106			31,090			-			923,196
Changes in operating assets and liabilities		63,732			61,590			-			125,322
Net cash used in operations		(1,008,339	)		(204,310	)		-			(1,212,649	)

Cash flow from investing activities:
Construction in process and acquisitions of property and equipment		188			(2,795,012	)		-			(2,794,824	)
Capital contribution to Entsorga West Virginia, LLC		(1,000,000	)		-			1,000,000			-
Other investing activities		52,400			-			-			52,400
Net cash used in investing activities		(947,412	)		(2,795,012	)		1,000,000			(2,742,424	)

Cash flows from financing activities:
Issuances of debt and equity		900,000			1,000,000			(1,000,000	)		900,000
Repayments of debt		(2,264	)		-			-			(2,264	)
Deferred financing costs incurred		-			(43,941	)		-			(43,941	)
Net cash provided by financing activities		897,736			956,059			(1,000,000	)		853,795
Effect of exchange rate on cash		19,851			-			-			19,851
Cash – beginning of period (restricted and unrestricted)		2,410,708			6,715,672			-			9,126,380
Cash – end of period (restricted and unrestricted)	$	1,372,544		$	4,672,409		$	-		$	6,044,953

Item 2.

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

The following discussion and analysis should be read in conjunction with our unaudited interim condensed consolidated financial statements and related notes appearing elsewhere in this report on Form 10-Q. In addition to historical information, this discussion and analysis contains forward-looking statements that involve risks, uncertainties, and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors, including but not limited to those set forth under “Risk Factors” in our Form ~~10K,~~10-K, as filed with the United States Securities and Exchange Commission, or the SEC, on ~~March 30, 2017.~~May 22, 2020.

Cautionary Note Regarding Forward-Looking Statements

The information in this report contains forward-looking statements. All statements other than statements of historical fact made in this report are forward looking. In particular, the statements herein regarding industry prospects and future results of operations or financial position are forward-looking statements. These forward-looking statements can be identified by the use of words such as “believes,” “estimates,” “intends”, “plans”, “could,” “possibly,” “probably,” anticipates,” “projects,” “expects,” “may,” “will,” or “should,” “designed to,” “designed for,” or other variations or similar words or language. No assurances can be given that the future results anticipated by the forward-looking statements will be achieved. Forward-looking statements reflect management’s current expectations and are inherently uncertain. Our actual results may differ significantly from management’s expectations.

Although these forward-looking statements reflect the good faith judgment of our management, such statements can only be based upon facts and factors currently known to us. Forward-looking statements are inherently subject to risks and uncertainties, many of which are beyond our control. As a result, our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth below under the caption “Risk Factors.” For these statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. You should not unduly rely on these forward-looking statements, which speak only as of the date on which they were made. They give our expectations regarding the future but are not guarantees. We undertake no obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless required by law.

Impact of COVID-19

The Company’s operations and business have experienced disruption due to the unprecedented conditions surrounding the COVID-19 pandemic spreading throughout the United States and the world. Due to the timing of initial and evolving governmental orders and guidelines impacting the Company’s financial operations in New York, and West Virginia, as well as other contributors to the process of financial statement preparation in other U.S. states, relating to social distancing, stay in place orders, travel and other restrictions on business, necessary and immediate access of personnel, records and information have been adversely effected as set forth throughout this report.

Company Overview

~~Since its inception,~~The Company’s mission is to reduce the ~~Company had primarily focused on its on-going Eco-Safe Digester business. During 2014 and 2015~~environmental impact of the ~~Company expanded its offering~~waste management industry through the development and deployment of cost-effective technology solutions. The Company’s suite of technologies ~~that transformed the digester market from just~~includes on-site biological processing equipment for food waste, ~~diversion to one that provides information that can allow customers~~patented processing facilities for the conversion of municipal solid waste into an E.P.A. recognized renewable fuel, and proprietary real-time data analytics tools to reduce ~~and eliminate or minimize their~~ food waste ~~through improved supply chain management~~generation. These unique proprietary solutions may enable certain businesses and ~~other efficiencies.~~municipalities of all sizes to lower disposal costs while having a positive impact on the environment. When used individually or in combination, the Company’s solutions can reduce the carbon footprint associated with waste transportation, repurpose non-recyclable plastics, and significantly reduce landfill usage.

Revolution Series™ Digesters

The Company currently markets an aerobic digestion technology solution for the disposal of food waste at the point of generation. Its line of Revolution Series Digesters have been described as self-contained, robotic digestive systems that are as easy to install as a standard dishwasher with no special electrical or plumbing requirements. Units range in size depending upon capacity, with the smallest unit approximately the size of a residential washing machine. The digesters utilize a biological process to convert food waste into a liquid that is safe to discharge down an ordinary drain. This process can result in a substantial reduction in costs for customers including restaurants, grocery stores, cruise lines and hotel/hospitality companies by eliminating the transportation and logistics costs associated with food waste disposal. The process also reduces the greenhouse gases associated with food-waste transportation and decomposition in landfills that have been linked to climate change. The Company offers its Revolution Series Digesters in several sizes targeting small to mid-sized food waste generators with both sale and rental options that are often more economical than traditional disposal methods. The Revolution Series Digesters are manufactured and assembled in the United States.

In ~~2016,~~an effort to expand the capabilities of its digesters, the Company ~~initiated development~~developed a sophisticated IoT technology platform to provide its customers with transparency into their waste generation and operational practices. This patented process collects weight related data from the digesters to deliver real-time data that provides valuable information that when analyzed, can improve efficiency and validate corporate sustainability efforts. The Company provides its IoT platform through a SaaS (“Software as a Service”) model that is either bundled in its rental agreements or sold through a separate annual software license. Prior to the launch of its Revolution Series Digesters, the Company marketed earlier generations of ~~Digesters. During 2017,~~its digesters under the ~~Seed~~Eco-Safe brand. These units were larger sized and ~~Sprout models became commercially available. Through September 30, 2017, a total~~typically marketed to mid- and large-sized food waste generators, including the Federal Government. The Company continues to add new capacity sizes to its line of 14 Revolution Series Digesters ~~had been shipped; during the month of October 2017, an additional 27 units were shipped.~~to meet customer needs.

~~Also during 2016,~~On January 30, 2020 the Company announced a purchase contract to provide its Revolution Series of Digesters to Carnival Corporation that the Company estimated with a value of $14 million over a two-year period. Leading up to that contract, the Company had been scaling its core infrastructure in anticipation of the fulfillment of that contract. As a result of COVID-19, Carnival Corporation has temporarily ceased ocean-going operations in North America through September 30, 2020, and as a result of current uncertainties, the implementation of the sales and services under this contract has been delayed. The contract remains in force and the Company anticipates that sales and services under this contract will resume as the uncertainties surrounding COVID-19 are resolved in the coming months.

HEBioT Resource Recovery Technology

The Company expanded ~~from~~ its ~~technology-digester single product line by starting strategic initiatives~~technology business in 2016 through the acquisition of certain development rights to a patented Mechanical Biological Treatment (“MBT”) ~~facilities~~technology developed by a European engineering firm that ~~rely~~relies upon High Efficiency Biological Treatment (“HEBioT”) to process waste at the municipal or ~~regional level~~enterprise level. The technology results in a substantial reduction in landfill usage by converting a significant portion of intake, including organic waste and non-recyclable plastics, into a United States EPA recognized alternative ~~commodity fuel.~~fuel that can be used as a partial replacement for coal. The company is currently exploring additional uses for its Solid recovered fuel (“SRF”) such as fuel for cogeneration and as a feedstock for bio-plastics.

~~On November 1,~~The Company also, through a series of transactions in 2017 ~~BioHiTech Global, Inc.~~ and ~~its wholly-owned subsidiary E.N.A. Renewables LLC, entered into a Technology License Agreement (the “License Agreement”) with Entsorgafin S.p.A. (“Entsorga”) whereby the Company~~2018, acquired a ~~license for~~controlling interest in the ~~design, development construction, installation and operation~~Nation’s first municipal waste processing facility utilizing the HEBioT technology located in Martinsburg, West Virginia (the “Martinsburg Facility”). The Martinsburg Facility, which commenced operations in 2019, is capable of ~~a High Efficiency Biological Treatment (“HEBioT”) renewable waste facility with a capacity of~~processing up to ~~165,000~~110,000 tons ~~per year,~~of mixed municipal waste annually. At full capacity, the Martinsburg Facility can achieve an annual savings of over 2.3 million cubic feet of landfill space and eliminate many of the greenhouse gases associated with ~~its initial targeted~~landfilling that waste. The Company plans to build additional HEBioT facilities in the coming years and is currently in the permitting process to build a second facility ~~being~~ in New York State.

~~During April 2017, the Company executed an agreement~~Combined Offering

The Company’s suite of products and services positions it as a leading provider of cost-effective, technology-based alternatives to acquire a site for the country’s second HEBioT facility to be located in New Windsor, New York. This agreement provides for a purchase price of the property of $1,092,000, subject to reduction for option payments made by the Companytraditional waste disposal in the ~~monthly amount of $3,500 for the first 12 months and $6,000 per month for the following 12 months, until the closing.~~United States. The purchase of the property is contingent upon the Company obtaining: necessary permits to allow construction of a Mechanical Biological Treatment (“MBT”) facility; approvals from state and local authorities; financing for the construction of the MBT facility; contracts for offtake of Solid Recovered Fuel; and the satisfactionuse of the Company’s ~~due diligence investigation~~technology solutions independently or in combination, can help its customers meet sustainability goals by achieving a significant reduction in greenhouse gases associated with waste transportation and landfilling. In addition, the repurposing of municipal waste into a cleaner burning, EPA recognized, renewable fuel can further reduce potentially harmful emissions associated with traditional means of disposal. The overall reduction in carbon and other greenhouse gases that are linked to climate change that could be achieved through the utilization of the ~~property. The contract also contains customary representations warranties and covenants~~Company’s technology can serve as a model for the future of ~~the parties for like transactions.~~

~~During March 2017, the Company consummated its 17.2% investment in Entsorga West Virginia, LLC, the first HEBioT plant~~waste disposal in the United ~~States, which~~States.

New Product Offering

In addition to the Company’s products focused on reducing the environmental impact of the waste management industry through the development and deployment of cost-effective technology solutions, as a result of symmetry with our customers and prospects and a new demand for post COVID environmental technologies, on May 12, 2020, the Company entered into an agreement with Altapure, LLC (“Altapure”). Altapure is ~~presently under construction~~a technology developer and ~~anticipated~~manufacturer of ultrasonic based disinfecting products, to ~~become operational during 2018.~~distribute its patented line of environmentally-friendly, high-level disinfecting products, including its newest product, the AP-4™, an enhanced, automated and touchless high-level disinfection sub-micron aerosol system providing a safe process and rapid kill of spores, viruses, and vegetative bacteria, such as but not limited to: COVID-19, Acinetobacter baumannii, Pseudomonas aeruginosa, VRE, MRSA, Bacillus atrophaeus, Geobacillus stearothermophilus, Polio virus, C. auris and Clostridium difficile (C. difficile); and commenced live product demonstrations in June 2020.

~~The combination~~Results of operations for the on-site digester and the facility based patented HEBioT technology results in a unique offering that provides a turn-key alternative for customers looking for a comprehensive solution to achieving zero waste. The Company envisions use of its digesters for disposal of food waste at certain retail customers’ locations, with regional disposal contracts being directedthree months ended March 31, 2020

compared to the ~~Company MBT facilities. The combination provides a cost-effective solution with less than 20% of post-consumer waste being directed to landfills, hence resulting in a near-zero footprint.~~three months ended March 31, 2019

~~Digester Based Products and Services~~Overview

	Three Months Ended March 31,
	2020			2019

Revenue	$	1,359,341		$	737,701
Operating expenses		3,753,291			2,659,004
Loss from operations		(2,393,950	)		(1,921,303	)
Other expenses		1,000,024			339,864
Net loss	$	(3,393,974	)	$	(2,261,167	)

~~Revolution Series Digester ®~~

Revenue increased $621,640 (84.3%) due to the HEBioT facility coming on-line in the second quarter of 2019 and an increase in digester equipment sales, which is the result of a strategic focus on sales as compared to rentals. These increases were offset by decreases in rental, service and maintenance resulting from lower service and maintenance revenue and management advisory fees as the Company reduces the level of support provided under the agreement in order to maintain adequate focus on the Company’s core services.

Operating expenses increased by $1,094,287 (41.2%) due to HEBioT facility costs, including depreciation, as well as increased costs associated with digester equipment sales resulting from the increase in sales and rental, service and maintenance due to increased staffing prior to the onset of COVID-19 as the Company scaled its core infrastructure in anticipation of executing a contract with Carnival Corporation, which was announced on January 30, 2020. The increases were offset by a decrease in selling, general and administrative expenses primarily due to a first quarter 2019 write-off of a HEBioT site that was discontinued in favor of a larger more suitable site.

The ~~Revolution Series Digester®,~~loss from operations increased by $472,647 (24.6%) as a result of increased operating expenses increasing greater than the increase in revenues.

Other expenses increased by $660,160 (194.2%) primarily due to interest related to the non-recourse municipal bond financing the HEBioT facility which ~~became commercially available~~was under construction in ~~March 2017, is~~ the ~~Company's new sustainable food waste disposal solution designed for lower volume food waste generators. Our Revolution Series~~first quarter of ~~Digesters may be used~~2019.

Net loss increased by ~~full~~$1,132,807 (50.1%) due to the increase in operating loss and ~~quick service restaurants, coffee shops, hospitality companies~~the increase in other expenses.

Revenue and ~~other specialty food service establishments that generate lesser~~Related Expenses

	Three Months Ended March 31,
	2020			2019

Revenue
HEBioT (related entity)	$	490,132		$	-
Rental, service and maintenance		471,093			487,701
Equipment sales		323,116			-
Management advisory and other fees (related entity)		75,000			250,000
Total revenue		1,359,341			737,701
Operating expenses
HEBioT processing (related entity)		812,427			-
Rental, service and maintenance		260,835			203,203
Equipment sales		146,404			-
Total related expenses		1,216,666			203,203
Contribution		142,675			534,498
Contribution margins
HEBioT (related entity)		(65.7	)%		-	%
Rental, service and maintenance		44.6			58.3
Equipment sales		54.7			-

HEBioT – The HEBioT facility commenced operations in the second quarter of 2019. During the first quarter of 2020 the facility was ramping up in-take volumes of waste, ~~than those~~however the primary customer for the facility’s solid recovered fuel (“SRF”) had not yet completed its construction of their fuel intake system that would allow for the ~~Eco-Safe Digester is more suitable for. This sub-segment~~delivery of SRF. Toward the end of the ~~food services industry is estimated to have more than 1.5 million locations.~~

~~The Revolution Series Digesters leverages~~first quarter in 2020 the ~~success~~customer was finalizing safety and building inspections that would allow for acceptance of the ~~underlying technologies~~SRF. During the first quarter of ~~our current line~~2020, the operating costs of ~~Eco-Safe Digesters designed for~~ the ~~mid-to-large volume waste generators. This new line has a compact design, operates on standard 115 Volt power~~facility exceeded revenues due to the operating of the facility and ~~is easily connected to existing plumbing, while providing all the user technology, including the Cloud~~^TM~~, Cirrus~~^TM~~, Mobile Application and Alto~~^TM ~~applications associated with the larger digesters.~~

~~Eco-Safe Digester®~~

The Company provides a simple, environmentally friendly, and cost effective solution for food waste disposal. The Eco-Safe Digester® is a data-driven, network-based mechanical/biological technology which transforms food waste into nutrient-neutral water that can safely be disposed of via conventional sanitary sewer systems. The Eco-Safe Digester reduces greenhouse gas emissions by reducing the volume of food waste being disposed of in landfills and eliminating the corresponding transportation of this waste. In addition, the technology saves users money by avoidinghigher disposal costs ~~(“tip fees”) and transportation charges. This process allows waste producing organizations~~related to ~~actively contribute~~excess SRF that was not able to ~~environmental sustainability and the preservation of resources in a cost-effective manner. The Eco-Safe Digester may~~ be used by businesses in food service, hospitality, healthcare, government, conference centers, education centers, or stadiums that generate a high volume of waste. It is estimated that the US addressable market is in excess of 250,000 locations that could qualify for digesters and an additional 250,000 internationally.

~~The BioHiTech BioBrain~~^TM~~, Cloud~~^TM~~, Cirrus~~^TM ~~Mobile Application and Alto~~^TM ~~Application~~

The Company leverages its existing technology, including our digester’s on-board weighing system, by collecting, accumulating and providing empirical data that can aid in improving the efficiency of the upstream supply chain. By streaming data from the digesters, collecting information from system users and integrating business application data, BioHiTech’s internet enabled system known as the BioHiTech Cloud^TM ~~can provide necessary data~~delivered to aid customers in reshaping their purchasing decisions and positively affect employee behavior. In its simplest form, the BioHiTech Cloud quantifies food waste in a fashion that has historically not been available. It enables users to understand food waste generation habits and to improve operational efficiencies.

The BioHiTech Cloud data is used to help educate customers as to where, when and how waste is being created. Tracking and analyzing waste based on creation time, food type, preparation stage, origin of waste or other key metrics may provide a clear picture of the food waste lifecycle. While the Eco-Safe Digester already provides significant economic savings and decreases in carbon footprint, the addition of the BioHiTech Cloud increases that impact by helping the customer to more accurately manage inventory, preparation practices and staff efficiencies.

The Company believes that its combined offering of technology and its Eco-Safe Digester provide customers with information that has not been readily available to consumers in the past that has the potential for improved management and reduction of waste at the point of generation on a real-time basis.

~~Mechanical Biological Treatment~~

In 2016, the Company formed E.N.A Renewables LLC, formerly known as Entsorga North America, LLC (“ENA”) as a wholly owned subsidiary. ENA owns a 31% interest in Apple Valley Waste Conversions, LLC (“AVWC”). Frank E. Celli, the Company’s CEO also owns a 20.9% interest in AVWC. In March 2017, Mr. Celli assigned his voting rights in AVWC so that, collectively, ENA would have voting control of over 51% of AVWC. AVWC currently holds the exclusive license for the development throughout 11 northeast U.S. states and the District of Columbia of the technology known as High Efficiency Biological Treatment (“HEBioT”), which is owned by Entsorgafin, an Italian company that provides cost effective environmental technologies throughout the world. HEBioT is a proprietary form of Mechanical Biological Treatment (“MBT”) that is used widely throughout Europe.secondary SRF customer.

~~The patented HEBioT technology converts mixed municipal~~Rental, service and ~~organic waste~~maintenance – Rental revenue increased by $44,590 (13.1%) to $386,254 in the first quarter of 2020, as compared to $341,664 in the first quarter of 2019. This increase was the result of an increase in the number of rental units. Service and maintenance revenue decreased by $61,198 (41.9%) to $84,838 in the first quarter of 2020, as compared to $146,036 in the first quarter of 2019. This decrease continues the trend of lower maintenance and service levels due to the newer Revolution Series of digesters. Rental, service and maintenance expenses increased by $57,632 (28.4%) primarily due to a ~~US Environmental Protection Agency (the “US EPA”) recognized alternative fuel source. By utilizing a combination of mechanical and biological processes to accelerate~~staffing increase in preparation for the ~~decomposition of~~execution on the ~~organic fraction of waste, the end-product produced, known as solid recovered fuel (“SRF”) has a carbon value equivalent to approximately 75-80% of traditional coal and can be used~~contract with Carnival Cruise Lines, which as a ~~replacement and/or supplement~~result of COVID-19 was delayed. Staffing costs increased by $46,406 (78.7%) to ~~coal. After receipt and processing~~$105,371 in the first quarter of ~~waste at~~2020, as compared to $58,965 in the ~~facility, approximately 80%~~first quarter of 2019. All other expenses increased by $11,226 (7.8%) to $155,464 in the ~~incoming waste is reduced, recycled or converted into~~first quarter of 2020, as compared to $144,238 in the ~~approved alternative fuel, with the remaining 20%~~first quarter of ~~the incoming waste being disposed of via traditional methods.~~

~~The US EPA has issued a “comfort letter” stating that any fuel produced utilizing the HEBioT technology is deemed~~2019 primarily due to an ~~engineered fuel and can be marketed as a commodity.~~increase in consumables offset by third party repair expenses.

Equipment sales – Equipment sales revenue increased by $323,116 (100.0%) as compared to no sales in the first quarter of 2019. Sales expense, like wise increased by $146,404 (100.0%) as compared to no sales in the first quarter of 2019. The contribution margin of 54.7% is in-line with historical rates. The Company began a shift in its deployment model to be more heavily weighted to sales versus rentals in the first quarter of 2020 and believes this trend will continue.

Management advisory and other fees – In order to maintain adequate focus on the Company’s core services as demand continues to grow for the Company’s products, it has reduced the level of support provided under the Management Advisory agreement. As a result, management advisory and other fees decreased by $175,000 (70.0%) to $75,000 in the first quarter of 2020, as compared to $250,000 in the first quarter of 2019. Effective April 1, 2020, the fee was further reduced to $100,000 per year. As the services are provided by the executive management of the Company, no incremental expenses are incurred or allocated as expenses of the services.

Selling, General and Administrative Expenses

Three Months Ended
March 31,
2020 2019

Staffing $ 1,078,535 $ 1,195,508
Professional fees 268,395 379,956
Other costs 176,663 435,382
Other expenses 394,830 315,516
Total selling , general and administrative expenses $ 1,918,423 $ 2,326,362
Staffing – Staffing expense decreased by $116,973 (9.8%) to $1,078,535 in the first quarter of 2020, as compared to $1,195,508 in the first quarter of 2019. This decrease was the result of a decrease in general staffing of $108,663 (14.2%), a decrease in stock based compensation of $15,105 (5.2%) offset in-part by an increase in employee fringe and taxes of $6,795 (4.9%).
Professional fees – Professional fees decreased by $111,561 (29.4%) to $268,395 in the first quarter of 2020, as compared to $379,956 in the first quarter of 2019. This decrease was the result of a decrease in legal expenses of $73,634 (47.4%) to $81,684 in the first quarter of 2020, as compared to $155,318 in the first quarter of 2019; a decrease in accounting expenses of $63,961 (37.6%) to $106,312 in the first quarter of 2020, as compared to $170,273 in the first quarter of 2019; a decrease in investment banking expenses of $21,275 (39.3%) to $32,800 in the first quarter of 2020, as compared to $54,075 in the first quarter of 2019; offset by an increase in public relations and marketing expenses of $47,309 to $47,599 in the first quarter of 2020, as compared to $290 in the first quarter of 2019. The decrease in legal and accounting was the result of a lower volume of acquisitions in 2020 than at the start of 2019 and the decrease in investment banking expenses was a shift to public relations and marketing.
Other costs – Other costs decreased by $258,719 (59.4%) to $176,663 in the first quarter of 2020, as compared to $435,382 in the first quarter of 2019. This decrease was the result of a non-recurring loss on the write-off of a HEBioT facility site amounting to $346,654 in the first quarter of 2019 that was discontinued in favor of a larger more suitable site, a decrease in equipment research & development of $7,120 (32.6%) offset primarily by increases of $77,124 (220.7%) in foreign currency fluctuations in the UK that are not hedged to $112,066 in the first quarter of 2020, as compared to $34,942 in the first quarter of 2019 and an increase of $16,154 (107.7%) in bad debt expense to $31,154 in the first quarter of 2020, as compared to $15,000 in the first quarter of 2019 relating to increased credit risks resulting from COVID-19.

Other expenses – Other expenses, which include marketing and other fees and services increased by $79,314 (25.1%) to $394,830 in the first quarter of 2020, as compared to $315,516 in the first quarter of 2019. This increase was primarily due to an increase of $73,900 (410.6%) in the contracted business services administration fee charged by Gold Medal to Entsorga West Virginia ~~LLC.~~

~~On January 1, 2017, the Company executed several agreements~~ to ~~acquire up to approximately a 40% interest~~$91,900 in EWV from the original investors at their original purchase price of $60,000 for each 1% of interest in EWV. The agreements provide for a required investment of $1,034,028, representing a 17.2% interest, with the remaining 23.1% being at the option of the Company. The agreement was subject to the approval of the EWV bond trustee, which was granted on March 20, 2017. On March 21, 2017, the Company completed the required investment acquisition of $1,034,028 for a 17.2% interest

~~EWV represents~~ the first ~~deployment~~quarter of ~~the Entsorga HEBioT technology~~2020, as compared to $18,000 in the ~~United States. Such deployment~~first quarter of 2019. The increase in fee is ~~currently underway in Martinsburg, WV. EWV has its own intellectual property agreement with Entsorgafin S.p.A. which is not part of~~ the agreement that AVWC has with Entsorgafin S.p.A. The EWV plant has received its necessary permits and EWV has closed on its financing to construct the facility. We anticipate the facility will be able to accept up to 110,000 tons per year of municipal solid waste delivered from the surrounding areas. The facility will consistresult of a 54,000 square foot industrial building located on approximately 12 acres of leased property. The facility will include a plant which will be equipped with HEBioT technology and will ultimately be able to produce approximately 50,000 tons per year of EPA recognized renewable fuel.

~~This first operational plant utilizing the patented HEBioT technology in the United States will serve as the Company’s “showplace” to help expedite future deployments.~~

~~New Windsor, NY Development~~

On March 1, 2017, the Town Counsel of New Windsor, NY approved, subject to a 30 day petition period during which certain voters could objection, the sale of 12 acres of property to the Company for the development of a Mechanical Biological Treatment (“MBT”) facility. On April 3, 2017, the Town Clerk of New Windsor certified that there had not been any objections raised and the agreement was executed on April 10, 2017. The purchase price of the property is $1,092,000, subject to reduction for option payments made by the Companystep-up in the monthly ~~amount of $3,500 for~~fee from when the ~~first 12 months and $6,000 per month for the following 12 months, until the closing. The purchase of the property is contingent upon the Company obtaining: necessary permits~~facility was under construction to allow construction of a MBT facility; approvals from state and local authorities; financing for the construction of the MBT facility; contracts for offtake of Solid Recovered Fuel; and the satisfaction of the Company’s due diligence investigation of the property. The contract also contains customary representations warranties and covenants of the parties for like transactions.when it became operational.

~~Corporate Headquarters~~

~~Our corporate headquarters are located at 80 Red Schoolhouse Road, Suite 101, Chestnut Ridge, New York 10977 and our phone number is (845) 262-1081. Our website can be found at~~ ~~www.biohitech.com~~ ~~. The information on our website is not incorporated in this report.~~

~~Critical Accounting Policies and Estimates~~

~~Use of Estimates —~~The preparation of consolidated financial statements, in conformity with GAAP requires the extensive use of management’s estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from these estimates. Estimates are used when accounting for items and matters including, but not limited to, allowance for uncollectible accounts receivable, obsolete, slow moving and excess inventory, asset valuations, including goodwill and intangibles, and useful lives, employee benefits, taxes and other provisions and contingencies.

~~Product and Services Revenue Recognition~~ - The Company recognizes revenue for the majority of its products sold upon transfer of title and the passage of the risk of ownership, which is generally upon shipment to the customer. Revenue from services is recognized as services are performed.

Depreciation and Amortization

~~Lease Revenue Recognition -~~ ~~The Company recognizes revenue from~~

Depreciation and amortization increased by $485,763 (375.3%) to $615,202 in the ~~rental~~first quarter of 2020, as compared to $129,439 in the first quarter of 2019. This increase was primarily the result of the ~~digester units ratably on a monthly basis over~~HEBioT facility becoming operational in the ~~term~~second quarter of 2019, as no depreciation and amortization was expensed while the ~~lease, as it has determined that~~facility was under construction. For the ~~rental agreements entered into in connection with its digester units qualify as operating leases, for which~~first quarter of 2020, depreciation and amortization related to the Company is the operating lessor. In order to determine lease classification as operating, the Company evaluates the terms of the rental agreement to determine if the lease includes any of the following provisions which would indicate capital lease treatment:

~~Transfer of ownership of the digester unit,~~

~~Bargain purchase option at the end of the term of the lease,~~

~~Lease term is greater than 75% of the economic life of the digester unit, or~~

~~Present value of minimum lease payments exceed 90% of the fair value of the digester unit at inception of the lease.~~

~~In addition, the Company also considers the following:~~

~~Collectability of the minimum lease payments is reasonably predictable, and,~~

~~No important uncertainties surround the amount of unreimbursable costs yet to be incurred by the Company under the lease.~~

~~Long-Lived Assets -~~ The Company assesses potential impairments to its long-lived assets if events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Indefinite-lived intangible assets are reviewed annually for impairment, or more frequently if events or changes in circumstances indicate that the carrying value may not be recoverable. An impaired asset is written down to its estimated fair value based upon the most recent information available. Estimated fair market value is generally measured by discounting estimated future cash flows.

~~Financial Instruments, Convertible Instruments, Warrants and Derivatives -~~ The Company reviews its convertible instruments for the existence of embedded conversion features which may require bifurcation, if certain criteria are met, the bifurcated derivative financial instrument is required to be recorded at fair value and adjusted to market at each reporting period end date. The Company also reviews and re-assesses, at each reporting date, any common stock purchase warrants and other freestanding derivative financial instruments and classifies them on the consolidated balance sheet as equity, assets or liabilities based upon the nature of the instruments.HEBioT facility was $490,469.

~~Fair Value Measurements~~Other Expenses ~~- Certain assets~~

Other expenses during the first quarter of 2020 and ~~liabilities are required~~2019 were comprised of interest income and expense. Other expense increased by $660,160 (194.2%) to ~~be recorded at fair value on a recurring basis. Fair value is determined based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price)~~$1,000,024 in the ~~principal or most advantageous market for~~first quarter of 2020, as compared to $339,864 in the asset or liability in an orderly transaction between market participants. Assets measured at fair value on a nonrecurring basis include long-lived assets held and used, long-lived assets held for sale, goodwill and other intangible assets. The fair valuefirst quarter of cash and cash equivalents, accounts receivable, short-term debt and accounts payable approximate their carrying values. The three-tier value hierarchy, which prioritizes valuation methodologies based on2019. This increase was primarily the ~~reliability~~result of the ~~inputs, is:~~

~~Level 1~~ ~~— Valuations based on quoted prices for identical assets and liabilities~~HEBioT facility becoming operational with interest being expensed, rather than capitalized into the facility. HEbioT related interest increased by $623,921 to $651,796 in ~~active markets.~~

~~Level 2~~ ~~— Valuations based on observable inputs other than quoted prices included~~the first quarter of 2020, as compared to $27,875 in Level 1, such as quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data.

~~Level 3~~ ~~— Valuations based on unobservable inputs reflecting~~ the ~~Company’s own assumptions, consistent with reasonably available assumptions made by other market participants.~~first quarter of 2019.

~~Equity Method Based Investments -~~ ~~The Company utilizes the equity method of accounting for investments in companies if the investment provides the ability to exercise significant influence, but not control, over operating~~Liquidity and financial policies of the investee. The Company’s proportionate share of net income or loss is included in the Company’s consolidated operations as earning or loss from unconsolidated equity basis investments.

~~Stock-Based Compensation -~~ The Company accounts for stock-based compensation in accordance with ASC 718, “Compensation - Stock Compensation.” ASC 718 requires generally that all equity awards be accounted for at their “fair value.” This fair value is measured on the grant date for stock-settled awards. Fair value is equal to the underlying value of the stock for “full-value” awards such as restricted stock and performance shares, and is estimated using an option-pricing model with traditional inputs for “appreciation” awards such as stock options and stock appreciation rights.

Costs equal to these fair values are recognized ratably over the requisite service period based on the number of awards that are expected to vest, or in the period of grant for awards that vest immediately and have no future service condition. For awards that vest over time, cumulative adjustments in later periods are recorded to the extent actual forfeitures differ from the Company’s initial estimates: previously recognized compensation cost is reversed if the service or performance conditions are not satisfied and the award is forfeited. The expense resulting from share-based payments is recorded the accompanying consolidated statements of operations based upon the functional classification of the individual grantees.

Subsequent modifications to outstanding awards result in incremental cost if the fair value is increased as a result of the modification. Thus, a value-for-value stock option repricing or exchange of awards in conjunction with an equity restructuring does not result in additional compensation cost.

~~Income Taxes -~~ Deferred income taxes are determined based on the estimated future tax effects of differences between the financial statement and tax bases of assets and liabilities given provisions of enacted laws. Deferred income tax provisions and benefits are based on changes to the asset or liabilities from year to year. In providing for deferred taxes, the Company considers tax regulations of the jurisdictions in which it operates, estimates the future taxable income and available tax planning strategies. If tax regulations, operating results or the ability to implement tax planning and strategies vary, adjustments to the carrying value of deferred tax assets and liabilities may be required. Valuation allowances are recorded related to deferred tax assets based on the “more than likely” criteria.

The Company recognizes the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the more likely than not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority.

~~Loss per Share -~~ The Company computes basic loss per share using the weighted-average number of shares of common stock outstanding and diluted loss per share, while the diluted loss per share also includes the effects of dilutive instruments using the “treasury method.”

The Company’s potential dilutive instruments include options, convertible debt and warrants. These instruments have not been considered in the calculation of diluted loss per share as they are anti-dilutive for the reported periods.

~~Results of Operations~~

~~Results of operation for the three months ended September 30, 2017~~

~~compared to the three months ended September 30, 2016~~

~~Summary Results~~Capital Resources

Three Months Ended September 30,
2017 2016
Revenue $ 656,347 100.0 % $ 623,578 100.0 %
Cost of revenue 500,860 76.3 432,618 69.4
Gross profit 155,487 23.7 190,960 30.6
Operating expenses 1,929,160 293.9 1,611,986 258.5
Loss from operations (1,773,673 ) (270.2 ) (1,421,026 ) (227.9 )
Other expenses 533,818 81.3 222,142 35.6
Net loss $ (2,307,491 ) (351.5 )% $ (1,643,168 ) (263.5 )%

For the three months ~~ended September 30, 2017~~March 31, 2020, the Company had a consolidated net loss of $3,393,974, incurred a consolidated loss from operations of $2,393,950 and used net cash in consolidated operating activities of $2,515,474. At March 31, 2020, consolidated total ~~revenue increased by 5.3% over the comparable 2016 period. This increase was driven by a 15.8% increase in rental, service and maintenance revenues and a 9.1% decrease in equipment sales.~~

~~Gross margin decreased~~stockholders’ equity amounted to 23.7% overall for the three months ended September 30, 2017 from 30.6% for the comparable 2016 period due to a change in the product mix and a decrease in the gross margin of the rental, service and maintenance line of business primarily due to a higher level of contracted services involved in servicing equipment outside of the Company’s direct coverage area and numerous installations on a trial basis of our newly released Revolution Series of digesters with national accounts.

~~Revenue by Type~~

~~The following table breaks down revenue by type:~~

Three Months Ended September 30,
2017 2016
Rental, service and maintenance $ 415,402 63.3 % $ 358,625 57.5 %
Equipment sales 240,945 36.7 264,953 42.5
$ 656,347 100.0 % $ 623,578 100.0 %

~~Total revenue~~ increased by $32,769, or 5.3%, from the three months ended September 30, 2016 to the three months ended September 30, 2017. Within revenue, services and maintenance increased by 15.8% from the three months ended September 30, 2016 to the three months ended September 30, 2017, while equipment sales decreased by 9.1%. As a percentage of total revenue, rental, service and maintenance increased to 63.3% of revenue for the three months ended September 30, 2016, as compared to 57.5% for the comparable 2016 period, while equipment sales as a percentage of revenue decreased to 36.7% from 42.5%, respectively. This decrease in equipment sales was primarily$5,787,541, consolidated stockholders’ equity attributable to ~~an decrease in international reseller activity in areas where the rental market is not as well recognized as the retail sales model.~~

~~Rental, service and maintenance revenue~~ ~~increased by $56,777, or 15.8%, from the three months ended September 30, 2016~~parent amounted to ~~the three months ended September 30, 2017. This increase is primarily driven by a greater number of rented units.~~

~~Equipment sales~~decreased by $24,008, or 9.1%, from the three months ended September 30, 2016 to the three months ended September 30, 2017. This decrease was due to an decrease in unit sales to distributors and international customers.

~~Cost of Revenue~~

~~The following table breaks down cost of revenue by type:~~

Three Months Ended September 30,
2017 2016
Rental, service and maintenance $ 348,862 69.7 % $ 256,107 59.2 %
Equipment sales 151,998 30.3 176,511 40.8
$ 500,860 100.0 % $ 432,618 100.0 %

Cost of revenue mainly consists of the cost of acquiring digester units that are sold, depreciation expense on rental units, warehousing, installation, maintenance, parts and shipping costs, as well as related salary and employee costs. Total costs of revenue increased by $68,242, or 15.8%, from the three months ended September 30, 2016 to the three months ended September 30, 2017, a period during which revenues increased by 5.3% primarily due to the change in mix of revenue between equipment sales and rental, service and maintenance, as well as a significant level of installation costs, partly due to the roll-out of the Revolution Series of digesters with trial periods with several large national chain stores.

~~Rental, service and maintenance costs of revenue~~ increased by $92,755, or 36.2 % (as compared to a 15.8% increase in rental, service and maintenance revenue) from the three months ended September 30, 2016 to the three months ended September 30, 2017.

Three Months Ended September 30,
2017 2016
Labor related costs $ 65,365 18.7 % $ 36,129 14.1 %
Depreciation 69,312 19.9 97,356 38.0
Contracted services 142,816 40.9 49,500 19.3
Parts and maintenance supplies 71,369 20.5 73,122 28.6
$ 348,862 100.0 % $ 256,107 100.0 %

Labor related costs increased by $29,236, or 80.9% from the three months ended September 30, 2016 to the three months ended September 30, 2017, due to the addition of staff focused on proactive customer involvement in the use, care and maintenance of our digesters with the goal of improving our infrastructure to support significant growth. Contracted services increased by $93,316 or 188.5% from the three months ended September 30, 2016 to the three months ended September 30, 2017, due to a significant increase in the Company’s focus on national account development and installations of the new Revolution Series digesters on trials. Depreciation decreased by $28,044 or 28.8% from the three months ended September 30, 2016 to the three months ended September 30, 2017, due to a portion of the leasing pool no longer having depreciation charges. Parts and maintenance supplies decreased by $1,753 or 2.4% from the three months ended September 30, 2016 to the three months ended September 30, 2017, due to decreased overhead costs.

~~Equipment sales cost of revenue~~ ~~decreased by $24,513 from the three months ended September 30, 2016 to the three months ended September 30, 2017 due to a decrease in the number and mix of digesters sold.~~

~~Gross Profit~~

~~The following table breaks down gross profit by type:~~

Three Months Ended September 30,
2017 2016
Rental, service and maintenance $ 66,540 42.8 % $ 102,518 53.7 %
Equipment sales 88,947 57.2 88,442 46.3
$ 155,487 100.0 % $ 190,960 100.0 %

~~The following table breaks down gross margin by type:~~

Three Months Ended September 30,
2017 2016
Rental, service and maintenance 16.0 % 28.6 %
Equipment sales 36.9 �� 33.4
Total 23.7 % 30.6 %

~~Rental, service and maintenance gross margin~~ Decreased by 12.6% to 16.0% for the three months ended September 30, 2017 primarily due to a higher level of contracted services involved in servicing equipment outside of the Company’s direct coverage area and numerous installations on a trial basis of our newly released Revolution Series of digesters.

~~Equipment sales gross margin~~ increased by 3.5% to 36.9% for the three months ended September 30, 2017 primarily due to the majority of 2017 sales involving new machines, that generally have higher gross margin rates than used equipment.

~~Operating expenses~~

~~The following table breaks down operating expenses by type:~~

Three Months Ended September 30,
2017 2016
Selling, general and administrative $ 1,090,003 56.5 % $ 983,725 61.0 %
Research and development 207,258 10.8 242,435 15.1
Professional fees 604,225 31.3 356,652 22.1
Depreciation and amortization 27,674 1.4 29,174 1.8
Total $ 1,929,160 100.0 % $ 1,611,986 100.0 %

~~Selling, general and administrative expenses~~ increased by $106,278, or 10.8% from the three months ended September 30, 2016 to the three months ended September 30, 2017. The following table breaks down the major categories of selling, general and administrative expenses:

Three Months Ended September 30,
2017 2016
Personnel $ 847,190 77.7 % $ 786,446 80.0 %
Facility and office costs 98,385 9.1 82,684 8.4
Sales and marketing 93,990 8.6 74,471 7.6
Other 50,438 4.6 40,125 4.0
Total $ 1,090,003 100.0 % $ 983,725 100.0 %

Personnel related expenses increased by $60,744 or 7.7% from the three months ended September 30, 2016 to the three months ended September 30, 2017. This increase was the result of increased staffing in sales and customer support areas. Sales and Marketing increased by $19,519 or 26.2% primarily due to increased travel and trade show costs related to both the digesters and MBT lines of business.

~~Research and development expenses~~ decreased by $35,177, or 14.5% from the three months ended September 30, 2016 to the three months ended September 30, 2017. This decrease was primarily driven a decrease in personnel expenses and external costs relating to the development of the Revolution Series of digesters.

~~Professional fees~~ ~~increased by $247,573, or 69.4% from the three months ended September 30, 2016 to the three months ended September 30, 2017. The following table breaks down the major categories of professional fees:~~

Three Months Ended September 30,
2017 2016
Investor relations and shareholder awareness $ 465,557 77.1 % $ 45,500 12.8 %
Audit and accounting services 25,440 4.2 57,808 16.2
Legal 103,862 17.2 48,197 13.5
Marketing, communications and strategic services 9,366 1.5 205,147 57.5
Total $ 604,225 100.0 % $ 356,652 100.0 %

Professional fees increased primarily due investor relations and shareholder awareness services focused on improved liquidity of the Company’s common stock, offset in-part by a decrease in strategic consulting.

~~Results of operation for the nine months ended September 30, 2017~~

~~compared to the nine months ended September 30, 2016~~

~~Summary Results~~

Nine Months Ended September 30,
2017 2016
Revenue $ 1,796,244 100.0 % $ 1,537,586 100.0 %
Cost of revenue 1,271,711 70.8 1,142,518 74.3
Gross profit 524,533 29.2 395,068 25.7
Operating expenses 5,527,294 307.7 4,812,010 313.0
Loss from operations (5,002,761 ) (278.5 ) (4,416,942 ) (287.3 )
Other expenses 1,212,164 67.5 553,799 36.0
Net loss $ (6,214,925 ) (346.0 )% $ (4,970,741 ) (323.3 )%

For the nine months ended September 30, 2017 total revenue increased by 16.8% over the comparable 2016 period. This increase was driven by a 14.5% increase in rental, service and maintenance revenue and a 21.1% increase in equipment sales, which was driven by reseller activity that continues to be predominantly sales based.

~~Gross margin improved from 25.7% overall for the nine months ended September 30, 2016 to 29.2% for the comparable 2017 period with improvements in both product revenues.~~

Operating expenses increased by 13.3% to $5,527,294 for the nine months ended September 30, 2017, which reflect an increase in professional fees of $723,690 related to supporting shareholder awareness and other professional services.

~~Revenue by Type~~

~~The following table breaks down revenue by type:~~

Nine Months Ended September 30,
2017 2016
Rental, service and maintenance $ 1,140,751 63.5 % $ 996,179 64.8 %
Equipment sales 655,493 36.5 541,407 35.2
$ 1,796,244 100.0 % $ 1,537,586 100.0 %

~~Total revenue~~ increased by $258,658 or 16.8%, from the nine months ended September 30, 2016 to the nine months ended September 30, 2017. Within revenue, services and maintenance increased by 14.5% from the nine months ended September 30, 2016 to the nine months ended September 30, 2017, while equipment sales increased by 21.1%. As a percentage of total revenue, rental, service and maintenance decreased to 63.5% of revenue for the nine months ended September 30, 2016, as compared to 64.8% for the comparable 2016 period, while equipment sales as a percentage of revenue increased to 36.5% from 35.2%, respectively.

~~Rental, service and maintenance revenue~~ ~~increased by $144,572, or 14.5%, from the nine months ended September 30, 2016 to the nine months ended September 30, 2017. This increase is primarily driven by a greater number of rented units.~~

~~Equipment sales~~ increased by $114,086, or 21.1%, from the nine months ended September 30, 2016 to the nine months ended September 30, 2017. This increase was due to an increase in unit sales to distributors and international customers.

~~Cost of Revenue~~

~~The following table breaks down cost of revenue by type:~~

Nine Months Ended September 30,
2017 2016
Rental, service and maintenance $ 880,559 69.2 % $ 761,834 66.7 %
Equipment sales 391,152 30.8 380,684 33.3
$ 1,271,711 100.0 % $ 1,142,518 100.0 %

Cost of revenue mainly consists of the cost of acquiring digester units that are sold, depreciation expense on rental units, warehousing, installation, maintenance, parts and shipping costs, as well as related salary and employee costs. Total costs of revenue increased by $129,193, or 11.3%, from the from the nine months ended September 30, 2016 to the nine months ended September 30, 2017, primarily due to the change in mix of revenue between equipment sales and rental, service and parts and improved margins from product sales.

~~Rental, service and maintenance costs of revenue~~ ~~increased by $118,725, or 15.6% (as compared to a 14.5% increase in rental, service and maintenance revenue) from the nine months ended September 30, 2016 to the nine months ended September 30, 2017.~~

Nine Months Ended September 30,
2017 2016
Labor related costs $ 188,583 21.4 % $ 108,555 14.2 %
Depreciation 213,268 24.2 247,680 32.5
Contracted services 221,664 25.2 149,943 19.7
Parts and maintenance supplies 257,044 29.2 255,656 33.6
$ 880,559 100.0 % $ 761,834 100.0 %

Labor related costs increased by $80,028, or 73.7% from the nine months ended September 30, 2016 to the nine months ended September 30, 2017, due to the addition of staff focused on proactive customer involvement in the use, care and maintenance of our digesters with the goal of improving our infrastructure to support significant growth. Contracted services increased by $71,721, or 47.8% from the nine months ended September 30, 2016 to the nine months ended September 30, 2017 due to an increase international activities and our on continuing focus on growing national accounts that are not in our direct service areas.

~~Equipment sales cost of revenue~~ increased by only $10,468 or 2.8% from the nine months ended September 30, 2016 to the nine months ended September 30, 2017, while sales increased by 21.1%, due to a shift in sales mix that resulted in improved overall margins.

~~Gross Profit~~

~~The following table breaks down gross profit by type:~~

Nine Months Ended September 30,
2017 2016
Rental, service and maintenance $ 260,192 49.6 % $ 234,345 59.3 %
Equipment sales 264,341 50.4 160,723 40.7
$ 524,533 100.0 % $ 395,068 100.0 %

~~The following table breaks down gross margin by type:~~

Nine Months Ended September 30,
2017 2016
Rental, service and maintenance 22.8 % 23.5 %
Equipment sales 40.3 29.7
Total 29.2 % 25.7 %

~~Rental, service and maintenance gross margin~~ ~~decreased by 0.7% to 22.8% for the nine months ended September 30, 2017 primarily due to higher levels of direct and contracted staff driven by an increased rental portfolio~~$1,264,636 and the ~~release of the new Revolution Series of digesters.~~

~~Equipment sales gross margin~~ ~~increased by 10.6% to 40.3% from 29.7% primarily due to primarily due to the majority of 2017 sales involving new machines, that generally have higher gross margin rates than used equipment.~~

~~Operating expenses~~

~~The following table breaks down operating expenses by type:~~

Nine Months Ended September 30,
2017 2016
Selling, general and administrative $ 3,211,855 58.1 % $ 3,171,973 65.9 %
Research and development 611,582 11.1 661,529 13.7
Professional fees 1,618,076 29.3 894,386 18.6
Depreciation and amortization 85,781 1.5 84,122 1.8
Total $ 5,527,294 100.0 % $ 4,812,010 100.0 %

~~Selling, general and administrative expenses~~ increased by $39,882, or 1.3% from the nine months ended September 30, 2016 to the nine months ended September 30, 2017. The following table breaks down the major categories of selling, general and administrative expenses, which accounted for 58.1% of operating expenses for the nine months ended September 30, 2017:

Nine Months Ended September 30,
2017 2016
Personnel $ 2,534,210 78.9 % $ 2,478,722 78.2 %
Facility and office costs 271,859 8.5 260,405 8.2
Sales and marketing 337,954 10.5 247,785 7.8
Other 67,832 2.1 185,061 5.8
Total $ 3,211,855 100.0 % $ 3,171,973 100.0 %

Sales and Marketing increased by $90,169 or 36.4% primarily due to increased travel and trade show costs related to both the digesters and MBT lines of business. Other expenses decreased by $117,229 or 63.3% from the nine months ended September 30, 2016 to the nine months ended September 30, 2017, which was the resultCompany had a ~~reversal of un-hedged foreign exchange losses that were incurred in 2016 incurred between the US companies and the United Kingdom operation of $128,323.~~

~~Research and development expenses~~ decreased by $49,947, or 7.6% from the nine months ended September 30, 2016 to the nine months ended September 30, 2017. This decrease was primarily driven by a reduction in external costs that were associated with the final manufacturing development of the Revolution line in the first quarter of 2017.

~~Professional fees~~ ~~increased by $723,690, or 80.9% from the nine months ended September 30, 2016 to the nine months ended September 30, 2017. The following table breaks down the major categories of professional fees:~~

Nine Months Ended September 30,
2017 2016
Investor relations and shareholder awareness $ 1,193,224 73.7 % $ 174,459 19.5 %
Audit and accounting services 177,598 11.0 259,119 29.0
Legal 175,557 10.9 191,759 21.4
Marketing and communications 71,697 4.4 269,049 30.1
Total $ 1,618,076 100.0 % $ 894,386 100.0 %

~~Professional fees increased primarily due investor relations and shareholder awareness services focused on improved liquidity of the Company’s common stock.~~

~~Liquidity and Capital Resources~~

~~Since inception, the Company has sustained substantial losses. The Company has an accumulated deficit of $27,287,091, a shareholders’ deficit of $16,140,210 and a~~consolidated working capital deficit of ~~$5,651,550 as of September 30, 2017.~~

~~The cash on hand is insufficient for us to continue our operations through November 2018.~~$11,913,331. While the Company had not met certain of its senior secured note’s financial covenants as of March 31, 2020, subsequent to that date the Company has favorably renegotiated those covenants and has received a waiver for such non-compliance through June 30, 2020 as it continues to ~~seek investors~~negotiate further extension of that waiver. Despite its current compliance under the ~~private offerings and other financing alternatives, if~~waiver, until such time as the Company ~~is unable~~regains compliance or receives a waiver of such covenants for a year beyond the balance sheet date, under current GAAP accounting rules the senior secured notes amounting to ~~obtain debt or equity financing to meet its cash needs, it may~~$4,241,578 have ~~to severely limit, its business plan by reducing the funds it hopes to expend on its business plan.~~

~~We do~~been classified as current debt. The Company does not yet have a ~~sustained~~ history of financial ~~stability. Historically, our principal source~~profitability. The Company does not have firm commitments to fund its future operational and strategic plans although it is presently in the process of ~~liquidity~~raising additional debt for general operations and to support its leasing activities. The Company has ~~been~~used its Shelf Registration on Form S-3 during September 2019 to raise net proceeds of $3,035,557 through a confidentially marketed public offering of common shares, has raised $1,495,450 through a private convertible preferred stock offering in March 2020 and subsequent to March 31, 2020 one of the ~~issuance of~~Company’s subsidiaries was funded $421,300 on May 13, 2020 through the Paycheck Protection Program.. There is no assurance that the Company will be able to raise sufficient capital or debt ~~and equity securities (including~~ to ~~related parties).~~sustain operations or to pursue other strategic initiatives or that such financing will be on terms that are favorable to the Company. These factors raise substantial doubt about the Company’s ability to continue as a going concern.

~~The Company is presently~~Impact of COVID-19 on Liquidity and Capital Resources

As a result of COVID-19 the implementation of the Company’s contract with Carnival Corporation has been delayed and the operations of some customers in the ~~process~~restaurant and hospitality industries have been temporarily interrupted due to governmental actions. For certain existing restaurant and hospitality customers, the Company has provided a deferral of ~~raising additional non-registered preferred stock, senior debt, convertible debt~~recurring rental payments for a short time and ~~capital for general operations~~have modified the rental agreements to extend the term by the period deferred. These actions have placed a strain on the Company’s cash flows resulting in the Company executing on cost controls and ~~for investment in several strategic initiatives,~~cash preservation practices that have included reducing executive cash compensation, laying off non-essential employees, limiting expenses and disbursements, as well as ~~commercial debt to support its leasing activities. There is no assurance that~~extending vendor payments.

Cash

As of March 31, 2020 and December 31, 2019, the Company will be able to raise sufficient debt or capital to sustain operations or to pursue other strategic initiatives or that such debt or capital may not be available on acceptable terms, if at all. There also can be no assurance that the planshad unrestricted cash balances of $1,934,846 and ~~actions proposed by management will be successful or that we will generate profitability~~$1,847,526, respectively.

Borrowings and ~~positive cash flows in the future.~~Debt

~~The consolidated financial statements have been prepared on a going concern basis,~~Contractual Maturities of Senior Secured, Junior Promissory, Notes Payable and Long Term Debt — As of March 31, 2020, excluding discounts and deferred finance costs, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The consolidated financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should we be unable to continueare being amortized as ~~a going concern. The ability of the Company to continue~~interest expense, are as ~~a going concern is dependent on management’s plans, which include further implementation of its business plan and continuing to raise capital.~~follow:

The table below presents borrowings, debts and advances as of September 30, 2017, along with their stated maturities along with the amount due at maturity. The line of credit, with an outstanding balance of $2,463,736 has an additional $36,264 available under its $2,500,000 facility. Of the total $17,091,717 face amount, $7,725,000 is mandatorily converted into common stock at its maturity, $1,470,000 is convertible at the holders’ option and the remaining amount of $7,896,717, which is due in cash includes $5,319,777 due to related parties and $2,463,736 due to a bank, on demand, which is guaranteed by certain related parties, that the Company is presently negotiating an expansion of the facility and a maturity schedule for all balances due thereunder.

Year Ending December 31,	Amortizing		Non- Amortizing		Total
2020 (Remaining)	$	3,144	$	100,000	$	103,144
2021		4,380		1,875,000		1,879,380
2022		3,821		2,500,000		2,503,821
2023		-		625,000		625,000
2024 and thereafter		-		1,044,477		1,044,477
Total	$	11,345	$	6,144,477	$	6,155,822

3225

Entsorga West Virginia, LLC WVEDA Solid Waste Disposal Revenue Bonds — as of March 31, 2020 the future sinking fund payments by the Company are as follow:

September 30, Due in:
2017 2017 2018 2019 Thereafter
Due in cash:
Secured line of credit, prime plus 0.5%* $ 2,463,736 $ 2,463,736 $ - $ - $ -
Advances, unsecured, 13% 544,777 544,777 - - -
Promissory notes, unsecured, 10% 375,000 - - - 375,000
Promissory note, 13% 4,500,000 - - 4,500,000 -
Other notes, secured, 1.9 to 4.98% 13,204 2,157 5,410 5,199 438
7,896,717 3,010,670 5,410 4,505,199 375,438

Due in cash or convertible by holder:
Series C convertible notes, 3.5% 1,250,000 - 1,250,000 - -
Convertible note, 9.5% 220,000 110,000 110,000 - -
1,470,000 110,000 1,360,000 - -

Mandatorily Convertible:
Series A convertible notes, 8% 3,400,000 - 3,400,000 - -
Series B convertible notes, 8% 1,900,000 - 1,900,000 - -
Series D convertible notes, 8% 2,000,000 - - 2,000,000 -
Series V convertible notes, 8% 425,000 - 425,000 - -
7,725,000 - 5,725,000 2,000,000 -
Total $ 17,091,717 $ 3,120,670 $ 7,090,410 $ 6,505,199 $ 375,438
Related party included above $ 10,394,777 $ 544,777 $ 4,750,000 $ 4,825,000 $ 275,000

Year Ending December 31,	2016 Issue 2026 Series		2016 Issue 2036 Series		2018 Issue 2036 Series		Total
2020 (remaining)	$	1,160,000	$	-	$	230,000	$	1,390,000
2021		1,215,000		-		255,000		1,470,000
2022		900,000		-		275,000		1,175,000
2023		965,000		-		300,000		1,265,000
2024 and thereafter		3,295,000		17,465,000		7,240,000		27,700,000
Total	$	7,535,000	$	17,465,000	$	8,000,000	$	33,000,000

* The line of credit, which does not have any operating financial covenants, is guaranteed by several related parties and is excluded from the related party amount included above, as the guarantee is secondary to the primary borrower.

~~Cash and Cash Equivalents~~

~~As of September 30, 2017 and December 31, 2016, the Company had cash balances of $480,329 and $325,987, respectively.~~

Cash Flows

Cash Flows from Operating Activities

We used ~~$3,836,030~~$2,515,474 of cash in operating activities during the ~~nine~~three months ended ~~September 30, 2017, an increase~~March 31, 2020 as compared to a use of ~~$178,283 from $3,657,747 of cash used in operating activities~~$1,212,649 during the ~~nine~~three months ended ~~September 30, 2016.~~March 31, 2019. Our net loss during the ~~nine~~three months ended ~~September~~March 31, 2020 of ~~$6,214,925 reflected~~$3,393,974 was reduced by non-cash expenses ~~totaling $1,873,245, including $1,247,039 in stock based employee compensation and fees paid in stock and warrants; $299,021~~ of depreciation and amortization and $223,718 of amortization of discounts on debt and deferred financing costs. Changes in operating assets and liabilities provided $505,650 of cash during the nine months ended September 30, 2017. Our net loss during the nine months ended September 30, 2016 of $4,970,741 was impacted by $331,807 of depreciation and amortization, $512,318 from stock based employee compensation and $55,076 of amortization of discounts on debt and deferred financing costs. Changes in operating assets and liabilities provided $343,326 of cash during the nine months ended September 30, 2016.$1,086,343.

Cash Flows from Investing Activities

~~Cash~~Net cash used in investing activities for the three months ended March 31, 2020 amounted to ~~$1,165,868~~$45,358, as compared to $2,742,424 in net cash used in investing activities for the ~~nine~~three months ended ~~September 30, 2017, compared to $3,825 for the nine months ended September 30, 2016, a change of $1,162,043, comprised~~March 31, 2019, which was primarily ~~of our MBT investments, including in Entsorga West Virginia, LLC and project costs~~ related to ~~New Windsor, NY.~~the construction of the HEBiot facility.

Cash Flows from Financing Activities

Cash provided by financing activities for the three months ended March 31, 2020 amounted to ~~$5,137,360~~$2,693,990 and is primarily the ~~nine months ended September 30, 2017, compared~~result proceeds of $1,495,450 from a preferred stock issuance and advances amounting to $3,733,583 the nine months ended September 30, 2016, an increase of $1,403,777. During the nine months ended September 30, 2017, we issued $4,120,000 in promissory and convertible notes (face amount), of which $1,465,000 was$1,200,000 from related parties. During the comparable 2019 period, the Company received proceeds of $750,000 from a preferred stock issuance and $150,000 in advances from a related party.

Off Balance Sheet Arrangements

We have not entered into any off-balance sheet arrangements during the ~~nine month period~~three months ended ~~September 30, 2017.~~March 31, 2020.

~~Recent Accounting Pronouncements~~

~~See Note 18 to our unaudited interim condensed consolidated financial statements regarding recent accounting pronouncements.~~

Item 3.

Quantitative and Qualitative Disclosures About Market Risk.

We are a smaller reporting company as defined by 17 C.F.R. 229 (10)(f)(i) and are not required to provide information under this item.

Item 4.

Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Our management carried out an evaluation, with the participation of our Principal Executive Officer and Principal Financial Officer, of the effectiveness of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”).

Based onupon their evaluation, ~~our Principal~~the Company’s Chief Executive Officer and ~~Principal~~Chief Financial Officer concluded that ~~our~~a material weakness existed and that the Company’s disclosure controls and procedures ~~were~~are not effective ~~as of the end of the period covered by this report~~ to ensure that information required to be disclosed by usthe Company in the reports that ~~we file~~the Company files or ~~submit~~submits under the Exchange Act, is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and ~~forms. Disclosure controls~~forms, and ~~procedures include, without limitation, controls and procedures designed to ensure~~ that such information ~~required to be disclosed by us in our reports that we file or submit under the Exchange Act~~ is accumulated and communicated to ~~our~~the Company’s management, including ~~our Principal~~the Company’s Chief Executive Officer and ~~Principal~~Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Because of our limited operations we have a small number of employees which prohibits a segregation of duties. As we grow and expand our operations, we will engage additional employees and experts as needed. However, there can be no assurance that our operations will expand.

Changes in Internal Controls Over Financial Reporting

There have not been any significant changes in our internal control over financial reporting during the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1.

Legal Proceedings.

On ~~or about April 21, 2017,~~February 7, 2018, Lemartec Corporation (“Lemartec”) filed a complaint against the Company ~~was served with a Summons and Complaint in an action captioned Tusk Ventures LLC v. BioHiTech Global, Inc.,~~ in the ~~Supreme~~United States District Court for the Northern District of West Virginia arising out of the ~~State~~construction of ~~New York, New York County.~~the Company’s resource recovery facility in Martinsburg, West Virginia alleging breach of contract and unjust enrichment. The ~~Plaintiff alleges that it is owed $250,000 pursuant~~Company has filed its answer and counterclaims for damages against Lemartec and cross claims against Lemartec’s performance bond surety, Philadelphia Indemnity Insurance Company. The trial was scheduled to ~~a Consulting Services Agreement. While~~begin in August 2020. Subsequent to year end and prior to the start of the trial, on March 12, 2020 the Company ~~has accrued all contractual amounts, it intends to defend~~entered into a settlement agreement that detailed the ~~action vigorously.~~full and final mutual release. The settlement agreement provides that the Company pay Lemartec $775,000 in installments of $475,000 within 60 days of the execution of the settlement agreement and $25,000 each month thereafter for 12 months. The Company’s consolidated financial statements as of December 31, 2019 reflects this liability given the nature of the subsequent event.

It is management’s opinion that the resolution of this claim will not materially affect the Company’s future financial position, results of operations, or cash flows.

From time to time, we are a party to, or otherwise involved in, legal proceedings arising in the normal and ordinary course of business. As of the date of this report, we are not aware of any other proceeding, threatened or pending, against us which, if determined adversely, would have a material effect on our business, results of operations, cash flows or financial position.

3427

Item 1A.

Risk Factors.

We are a smaller reporting company as defined by 17 C.F.R. 229 (10)(f)(i) and are not required to provide information under this item.

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds.

On ~~November 1, 2017, BioHiTech Global, Inc.~~March 9, 2020 the Registrant designated a new series of preferred stock and ~~its wholly-owned subsidiary E.N.A. Renewables LLC, entered into a Technology License Agreement~~subsequently on March 18, 2020 had an initial closing of $1,500,000 on 13,045 shares of the new series of preferred stock and 178,597 common stock warrants. This initial closing was followed by an additional closing on April 6, 2020 of $65,000 on 566 shares of the new series of preferred stock and 7,750 common stock warrants. The newly designated series, the Series F Redeemable, Convertible Preferred Stock (the ~~“License Agreement”) with Entsorgafin S.p.A. (“Entsorga”) whereby the Company acquired a license for the design, development construction, installation and operation~~Sr. F Preferred Stock) is comprised of ~~a High Efficiency Biological Treatment (“HEBioT”) renewable waste facility~~30,090 shares with a ~~capacity of 165,000 tons per year. The HEBioT technology converts mixed municipal and organic waste to a US Environmental Protection Agency recognized alternative fuel source.~~

~~The royalty payment for the license amounted to $6,019,200, which was comprised of 1,035,905 shares (the “Shares”) of the Company’s common stock,~~ par value of $0.0001 per share and a stated value per share of $115.00 that has a dividend rate of 9%. The Sr. F Preferred Stock is convertible by the holder at any time at a conversion rate of $2.10, subject to certain antidilution adjustments and is redeemable by the Registrant after 24 months at its stated value, plus any outstanding accrued or accumulated dividends for cash, or if the Registrant’s common stock is trading over $3.00 per share and has daily trading volume of over 50,000 shares, for the Registrant’s common stock at the conversion rate in ~~an amount up to $839,678.40 for payment of Entsorga’s withholding taxes in~~effect at the ~~Unites States and Italy.~~

~~The Company also entered into a Registration Rights Agreement~~time. In connection with ~~Entsorga whereby~~ the ~~Company granted Entsorga certain piggy-back and demand registration rights with respect to the Shares.~~

On October 30, 2017, the Company entered into a Securities Purchase Agreements (the “Purchase Agreement”) with a single, accredited investor (the “Investor”), pursuant to which the Company agreed to sell and the Investor agreed to purchase up to an aggregate of 333,401 sharesoffering of the ~~Company’s newly created Series A Convertible~~Sr. F Preferred Stock, ~~par value $0.0001 per share (the “Series A Shares”) for an aggregate investment of up~~the Registrant also issued warrants that expire in five years to ~~$1,667,000 for~~acquire the ~~aggregate purchase price up to $1,500,300. In addition, the Company agreed to issue warrants (the “Warrants”) to purchase up to 333,401 shares of the Company’s~~Registrant’s common stock ~~par value $0.0001~~at $2.30 per ~~share (the “Common Stock”) at the exercise price of $5.00 per~~ share. At the first closing, consummated on October 31, 2017 (the “First Closing”) the Investor purchased 133,334 shares of Series A Shares and Warrants to purchase an additional 133,334 shares of Common Stock for a purchase price of $600,000. The Company, assuming its satisfaction of certain conditions, has the option to sell to the Investor an additional 200,067 Series A Shares and Warrants to purchase 200,067 shares of Common Stock for the purchase price of $900,300, thirty days after the First Closing.

The Series AF Shares are convertible into share of Common Stock at the rate of one share of Common Stock for $5.00 of stated value of Series A Shares converted (effectively, on a 1 for 1 basis). The conversion rate is subject to adjustment for stock splits, reclassification and issuance of certain Securities at a purchase price per share below the conversion price. The Series A Shares will automatically convert into Common Stock if the Company (i) receives gross proceeds of $6,000,000 or (ii) receives gross proceeds sufficient to qualify for listing on a natural securities exchange. If the Company completes a financing at a price per share of less than $5.00, one-half of the Series A Shares will convert at a conversion price equal to the purchase price of such financing. The Series A Shares are entitled to receive dividends, payable quarterly commencing December 31, 2017, at the rate of five percent (5%) during the first year of issuance, and increasing two percent (2%) per month thereafter. The Series A Shares rank senior to the Company’s Common Stock with respect to dividends, distributions and payments on liquidation. The Registrant also has the right to redeem the Series A Shares one year after the First Closing for 120% of the stated value plus any unpaid dividends. Commencing on June 1, 2019, the Investor will have the right to require the Company to redeem the Series A Shares for 115% of the Conversion Amount, under certain circumstances.

The Company also granted the Investor certain piggy-back registration rights with respect to the shares of Common Stock underlying the conversion of the Series A Shares and the exercise of the Warrants.

Effective October 2, 2017 the Company entered into a new shareholder awareness consulting agreement with its existing consultant. This agreement has a term of 90 days and includes cash fees of $90,000, the issuance of the 35,000 shares of common stock and warrants to purchase 10,000 shares of common stock at $5.00 per share.

On August 17, 2017, the Company completed a private placement offering (the “Offering) which, including over allotments, provided for an offering up to $2,000,000 in “Units” (as that term is defined below). As previously reported, on July 6, and 7, 2017 and on August 17, 2017, the Company received gross proceeds of $2,000,000 from the Offering, including $140,000 of payments in kind, which occurred from twenty-one (21) investors, including two (2) related parties who invested $325,000.

In connection with the Offering, the Company entered into a series of Securities Purchase Agreements (the “Purchase Agreement”) with each accredited investor (the “Investors”), pursuant to which the Company agreed to sell and the Investors agreed to purchase units comprised of a mandatorily Convertible Promissory Note (the “Note”) and Warrants (the “Warrants”) to purchase shares of the Company’s common stock, par value $0.0001 per share (the “Common Stock”). Each Note bears interest at the rate of 8% per annum and is due on the earlier of: (i) July 6, 2019; (ii) the date the Common Stock is listed on The Nasdaq Stock Market or NYSE MKT (the “Listing”); or (iii) a “Change of Control” of the Company which is defined as a liquidation, dissolution, winding up, change in voting control, or sale of all or substantially all of the Company’s assets (the “Maturity”). At Maturity, each Note is convertible into shares of Common Stock ~~equal~~at a fixed conversion price of $2.10 per share of Common Stock subject to certain anti-dilution adjustments (the “Conversion Price”) and redeemable by the ~~outstanding principal amount~~Company twenty-four (24) months after issuance for cash, provided that such cash payment is permissible under the ~~Note,~~Company’s existing indebtedness and obligations, or for shares of Common Stock at the Stated Value, plus any outstanding accrued or accumulated dividends if the closing price of the Common Stock is over $3.00 per share and the average daily, trading volume is over 50,000 shares. The Series F Shares will also accrue dividends at the rate of nine percent (9%) per annum, payable in semi-annual installments of cash, provided such cash payment is permitted, or at the option of the Purchaser, in shares of Common Stock at the Conversion Price. In addition, the Series F Shares, plus any accrued and unpaid ~~interest, divided~~dividends, may be converted at any time by ~~a conversion price (the “Conversion Price”) equal to~~ the lowest of: (i) the trading price on the date of the Listing; (ii) the price per share paid by investors in a subsequent underwritten public offering in connection with the Listing; (iii) the lowest price paid by investors in a subsequent offering of the Company securities; (iv) the per share price in a Change of Control transaction; or (v) $2.75 per share. Prior to maturity, an Investor Company may elect, at its option and in its sole discretion, to convert all or a portion of the outstanding principal amount under the Note, plus any accrued and unpaid interest,Investors into ~~a number of shares of~~ Common Stock at ~~a conversion price equal to $2.75 per share. The Warrants are exercisable for a period of five years into a number of shares of Common Stock equal to~~ the ~~number of shares of Common Stock into which such Investor’s Note is convertible at an exercise price equal to 120%~~Conversion Price.

All of the ~~Conversion Price. The foregoing descriptions of the~~securities referred to, above, ~~referenced agreements do not purport to be complete. For an understanding of their terms~~were offered and provisions, reference should be made to the Purchase Agreement attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on July 12, 2017. A copy of the Form of Note and the Form of Warrant are attached to the Company’s Current Report on Form 8-K filed on July 12, 2017 as Exhibits 10.2 and 10.3, respectively, and are incorporated herein by reference.

Effective July 25, 2017, the Company and an investor relations consultant agreed to amend certain terms to an existing contract, through which, the Company agreed to grant the consultant an additional 30,000 shares that will be earned through November 30, 2017, the remaining term of the contract.

Effective July 3, 2017, the Company and the investor awareness consultant agreed to amend certain terms to an existing contract. The amendment extended the term of the contract through September 30, 2017. Under the terms of the extension, in addition to cash fees, the Company agreed to grant the consultant an additional 75,000 shares that will be earned over the amended term of the contract.

~~The Company did not engage a placement agent and no compensation was paid in any of the above offerings.~~

~~The Company relied on the exemptions from~~sold without registration under ~~Section 4(2) of~~ the Securities Act of 1933, as amended ~~and Rule 506 promulgated thereunder. The Purchase Agreements and~~(the “Securities Act”) in reliance on the Agreement contain representations to support the Company’s reasonable belief that the investors had access to information concerning the Company’s operations and financial condition, the investors acquired the securities for their own account and not with a view to the distribution thereof in the absence of an effective registration statement or an applicable exemption from registration, and that the investors are sophisticated within the meaning ofexemptions provided by Section ~~4(2)~~4(a)(2) of the Securities Act ~~and are “accredited investors” (as defined by~~as provided in Rule ~~501~~506(b) of Regulation D promulgated thereunder. All of the foregoing securities as well the Common Stock issuable upon conversion or exercise of such securities, have not been registered under the Securities ~~Act). In addition,~~Act or any other applicable securities laws and are deemed restricted securities, and unless so registered, may not be offered or sold in the United States except pursuant to an exemption from the registration requirements of the Securities Act.

The sale of securities did not involve a public offering; the Company made no solicitation in connection with the sale other than communications with the investors; the Company obtained representations from the investors regarding their investment intent, experience and sophistication; and the investors either received or had access to adequate information about the Company in order to make an informed investment decision.

Item 3.

Defaults Upon Senior Securities.

None.

Item 4.

Mine Safety Disclosures.

Not Applicable.

Item 5.

Other Information.

~~None.~~Not Applicable.

Item 6.

Exhibits.

See the exhibits listed in the accompanying “Index to Exhibits.”

3628

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.

		BioHiTech Global, Inc.

~~November 14, 2017~~June 29, 2020	By:	/s/ Frank E. Celli
	Name:	Frank E. Celli
	Title:	Chief Executive Officer
		(Principal Executive Officer)

	By:	/s/ Brian C. Essman
	Name:	Brian C. Essman
	Title:	Chief Financial Officer and Treasurer
		(Principal Financial and Accounting Officer)

3729

INDEX TO EXHIBITS

Exhibit		Incorporated by Reference			Filed or Furnished
No.	Exhibit Description	Form	Date	Number	Herewith
31.1	Certification of Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934, as amended				Filed
31.2	Certification of Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934, as amended				Filed
32.1	Certification of Chief Executive Officer required by Rule 13a-14(b) or Rule 15d-14(b) under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.				Furnished*
32.2	Certification of Chief Financial Officer required by Rule 13a-14(b) or Rule 15d-14(b) under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.				Furnished*
101.INS	XBRL Instance Document				Filed
101.SCH	XBRL Taxonomy Extension Schema Document				Filed
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document				Filed
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document				Filed
101.LAB	XBRL Taxonomy Extension Label Linkbase Document				Filed
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document				Filed

* This exhibit is being furnished rather than filed and shall not be deemed incorporated by reference into any filing, in accordance with Item 601 of Regulation S-X.

Copies of this report (including the financial statements) and any of the exhibits referred to above will be furnished at no cost to our shareholders who make a written request to our Corporate Secretary at 80 Red Schoolhouse Road, Chestnut Ridge, New York ~~10977~~

10977.

3830

Delaware		46-2336496
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

80 Red Schoolhouse Road, Suite 101 Chestnut Ridge, New York		10977
(Address of principal executive offices)		(Zip Code)

Large accelerated filer ¨	Accelerated filer ¨
Non-accelerated filer ¨x ~~(Do not check if a smaller reporting company)~~	Smaller reporting company x
	Emerging growth company ¨

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, $0.0001 par value per share		BHTG		NASDAQ Capital Market

Class		Outstanding as of ~~November 10, 2017~~June 24, 2020
Common Stock, $0.0001 par value per share		~~9,598,208 shares~~17,437,288

	September 30,			December 31,
	2017			2016
Assets
Current Assets
Cash	$	480,329		$	325,987
Accounts receivable, net		234,669			140,130
Inventory		346,160			706,017
Prepaid expenses and other current assets		101,093			21,865
Total Current Assets		1,162,251			1,193,999
Equipment on operating leases, net		1,255,409			1,023,404
Equipment, fixtures and vehicles, net		45,096			54,356
Intangible assets, net		196,683			267,042
Investment in Entsorga West Virginia, LLC		1,022,190			-
MBT facility development costs		139,313			-
Other assets		23,500			13,500
Total Assets	$	3,844,442		$	2,552,301
Liabilities and Stockholders' Deficit
Current Liabilities:
Line of credit	$	2,463,736		$	2,463,736
Accounts payable		921,129			1,197,277
Accrued expenses		624,856			522,727
Accrued interest		925,790			411,917
Deferred revenue		109,183			61,879
Notes payable, including related party of $275,000		-			375,000
Convertible note, net of deferred financing cost of $6,320 and discounts of $22,648		191,032			-
Convertible notes, including related party of $450,000, net of discounts of $310,814		939,186			-
Advance from related party		544,777			1,213,027
Customer deposits		87,830			36,131
Long-term debt, current portion		6,282			8,525
Total Current Liabilities		6,813,801			6,290,219
Promissory note, related party		4,500,000			2,500,000
Long-term debt, net of current portion		6,922			11,048
Notes payable, including related party of $275,000		375,000			-
Accrued interest, payable in cash or common stock		615,468			253,000
Unsecured subordinated mandatorily convertible notes, including related parties of $4,625,000 and $3,800,000, net of deferred financing costs of $51,539 and $118,866 as of September 30, 2017 and December 31, 2016, respectively		7,673,461			4,956,134
Total Liabilities		19,984,652			14,010,401
Commitments and Contingencies
Stockholders' Deficit
Preferred stock, $0.0001 par value; 10,000,000 shares authorized; none issued		-			-
Common stock, $0.0001 par value, 50,000,000 shares authorized, 8,446,849 shares issued and outstanding as of September 30, 2017; 20,000,000 shares authorized, 8,229,712 shares issued and outstanding as of December 31, 2016		845			823
Additional paid in capital		11,181,512			9,604,324
Accumulated deficit		(27,287,091	)		(21,072,166	)
Accumulated other comprehensive (loss) gain		(35,476	)		8,919
Total Stockholders' Deficit		(16,140,210	)		(11,458,100	)
Total Liabilities and Stockholders' Deficit	$	3,844,442		$	2,552,301

		Page
	PART I - FINANCIAL INFORMATION	1

Item 1.	Condensed Consolidated Financial Statements.	21

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	2221

Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	3427

Item 4.	Controls and Procedures.	3427

	PART II - OTHER INFORMATION

Item 1.	Legal Proceedings.	3427

Item 1A.	Risk Factors.	3528

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	3528

Item 3.	Defaults Upon Senior Securities.	3628

Item 4.	Mine Safety Disclosures.	3628

Item 5.	Other Information.	3628

Item 6.	Exhibits.	3628

SIGNATURES		3729

INDEX TO EXHIBITS		3830

	Three Months Ended September 30,						Nine Months Ended September 30,						Three Months Ended March 31,
	2017			2016			2017			2016			2020			2019
Revenue
HEBioT (related entity)													$	490,132		$	-
Rental, service and maintenance	$	415,402		$	358,625		$	1,140,751		$	996,179			471,093			487,701
Equipment sales		240,945			264,953			655,493			541,407			323,116			-
Management advisory and other fees (related entity)														75,000			250,000
Total revenue		656,347			623,578			1,796,244			1,537,586			1,359,341			737,701
Cost of revenue
Operating expenses
HEBioT processing (related entity)														812,427			-
Rental, service and maintenance		348,862			256,107			880,559			761,834			260,835			203,203
Equipment sales		151,998			176,511			391,152			380,684			146,404			-
Total Cost of revenue		500,860			432,618			1,271,711			1,142,518
Gross profit		155,487			190,960			524,533			395,068
Operating expenses
Selling, general and administrative		1,090,003			983,725			3,211,855			3,171,973			1,918,423			2,326,362
Research and development		207,258			242,435			611,582			661,529
Professional fees		604,225			356,652			1,618,076			894,386
Depreciation and amortization		27,674			29,174			85,781			84,122			615,202			129,439
Total operating expenses		1,929,160			1,611,986			5,527,294			4,812,010			3,753,291			2,659,004
Loss from operations		(1,773,673	)		(1,421,026	)		(5,002,761	)		(4,416,942	)		(2,393,950	)		(1,921,303	)
Other expense (income)
Equity loss in affiliate		5,922			-			11,838			-
Loss on change in fair value of warrants		-			-			1,999			-
Other expenses
Interest income		(712	)		-			(713	)		(3,068	)		(12,267	)		-
Interest expense		528,608			222,142			1,199,040			556,867			1,012,291			339,864
Total other expense, net		533,818			222,142			1,212,164			553,799
Total other expenses														1,000,024			339,864
Net loss		(2,307,491	)		(1,643,168	)		(6,214,925	)		(4,970,741	)		(3,393,974	)		(2,261,167	)
Other comprehensive (loss) income
Net loss attributable to non-controlling interests														(822,677	)		(311,701	)
Net loss attributable to Parent														(2,571,297	)		(1,949,466	)
Other comprehensive income (loss)
Foreign currency translation adjustment		(15,891	)		4,098			(44,395	)		10,498			(28,699	)		1,253
Comprehensive loss	$	(2,323,382	)	$	(1,639,070	)	$	(6,259,320	)	$	(4,960,243	)	$	(2,599,996	)	$	(1,948,213	)

Net loss per share - basic and diluted	$	(0.27	)	$	(0.20	)	$	(0.75	)	$	(0.60	)
Net loss attributable to Parent													$	(2,571,297	)	$	(1,949,466	)
Preferred stock dividends														(177,373	)		(127,919	)
Net loss attributable to common shareholders														(2,748,670	)		(2,077,385	)
Net loss per common share - basic and diluted													$	(0.16	)	$	(0.14	)
Weighted average number of common shares outstanding - basic and diluted		8,397,191			8,229,712			8,316,943			8,229,712			17,376,507			14,816,734

	March 31, 2020		December 31, 2019
		(Unaudited)
Assets
Current Assets
Cash	$	1,934,846	$	1,847,526
Restricted cash		1,137,714		1,133,581
Accounts receivable, net of allowance for doubtful accounts of $ 98,366 and $170,038 as of March 31, 2020 and December 31, 2019, respectively (related entity $1,860,171 and $1,370,867 as of March 31, 2020 and December 31, 2019, respectively)		2,485,691		2,155,921
Inventory		366,482		467,784
Prepaid expenses and other current assets		172,655		126,357
Total Current Assets		6,097,388		5,731,169
Restricted cash		2,563,978		2,555,845
Equipment on operating leases, net		1,654,753		1,724,998
HEBioT facility, equipment, fixtures and vehicles, net		36,979,350		37,421,333
Operating lease right of use assets		918,585		945,047
License and capitalized MBT facility development costs		8,042,938		8,049,929
Goodwill		58,000		58,000
Other assets		48,849		53,726
Total Assets	$	56,363,841	$	56,540,047

Statement of Stockholders’ Equity Attributable to Parent for the Three Months Ended March 31, 2020:
	Preferred Stock				Common Stock				Additional Paid in		Accumulated Comprehensive			Accumulated
	Shares		Amount		Shares		Amount		Capital		Other Loss			Deficit			Total
Balance at January 1, 2020		710,869	$	5,253,734		17,300,899	$	1,730	$	49,597,059	$	(43,138	)	$	(52,785,242	)	$	2,024,143
Series F preferred stock issuance		13,045		1,444,614		-		-		50,836		-			-			1,495,450
Share-based employee and director compensation		-		-		102,500		10		280,195		-			-			280,205
Preferred stock dividends		-		-		13,889		1		24,999		-			(17,564	)		7,436
Net loss		-		-		-		-		-		-			(2,571,297	)		(2,571,297	)
Foreign currency translation adjustment		-		-		-		-		-		28,699			-			28,699

Balance at March 31, 2020		723,914	$	6,698,348		17,417,288	$	1,741	$	49,953,089	$	(14,439	)	$	(55,374,103	)	$	1,264,636

	Common Stock Issued and Outstanding				Additional			Accumulated Other
	Shares		Par Amount		Paid in Capital			Comprehensive Gain (Loss)			Accumulated Deficit			Total
Balance at January 1, 2017		8,229,712	$	823	$	9,604,324		$	8,919		$	(21,072,166	)	$	(11,458,100	)

Share-based employee and director compensation		-		-		375,508			-			-			375,508

Share-based professional services compensation		133,000		14		873,516			-			-			873,530

Warrants in connection with debt issuance		-		-		183,987			-			-			183,987

Beneficial conversion feature of debt		-		-		144,185			-			-			144,185

Exercise of warrants		84,137		8		(8	)		-			-			-

Foreign currency translation adjustment		-		-		-			(44,395	)		-			(44,395	)

Net loss		-		-		-			-			(6,214,925	)		(6,214,925	)
Balance at September 30, 2017		8,446,849	$	845	$	11,181,512		$	(35,476	)	$	(27,287,091	)	$	(16,140,210	)

Statement of Stockholders’ Equity Attributable to Non-Controlling Interests in Consolidated Subsidiaries for the Three Months Ended March 31, 2020:
	Non-Controlling		Accumulated
	Equity Interest		Deficit			Total
Balance at January 1, 2020	$	8,079,585	$	(2,734,003	)	$	5,345,582
Net loss		-		(822,677	)		(822,677	)

Balance at March 31, 2020	$	8,079,585	$	(3,556,680	)	$	4,522,905

	March 31,			December 31,
	2020			2019
Leased equipment	$	3,175,933		$	3,138,951
Less: accumulated depreciation		(1,521,180	)		(1,413,953	)
Total Equipment on Operating Leases, net	$	1,654,753		$	1,724,998

Year Ending December 31,
2017(remaining period)	$	245,184
2018		839,675
2019		709,112
2020		508,268
2021 and thereafter		315,908
Total minimum lease income	$	2,618,147

Year ending December 31,
2020, remaining period	$	1,024,508
2021		990,315
2022		719,049
2023		457,898
2024 and thereafter		181,725
	$	3,373,495

	March 31, 2020		December 31, 2019
MBT Projects
Survey and engineering		259,738		235,229

Technology Licenses
Future site		6,019,200		6,019,200
Martinsburg, West Virginia, net of $126,000 and $94,500 of amortization as of March 31, 2020 and December 31, 2019		1,764,000		1,795,500
Total Technology Licenses		7,783,200		7,814,700
Total MBT Facility Development and License Costs	$	8,042,938	$	8,049,929

	March 31, 2020				December 31, 2019
	Total		Related Party		Total		Related Party
Line of credit	$	1,481,356	$	-	$	1,479,848	$	-
Senior secured promissory note		4,241,578		-		4,160,490		-
Junior promissory note		954,885		954,885		949,434		949,434
Note payable		100,000		-		100,000		-
Advances from related parties (See Note 14 Related Parties)		1,410,000		1,410,000		210,000		210,000
Long term debt - current and long-term portion		11,345		-		12,806		-

	(Unaudited) June 30,
Balance Sheet	2017^(a)
Current assets - cash	$	4,085
Non-current assets:
Restricted cash		16,127,778
Facility under development and construction		13,168,100
Total Assets	$	29,299,963
Current liabilities	$	591,608
Non-current liabilities - Tax-exempt bonds, net of $1,616,131 of issuance costs		23,511,677
Membership equity		5,196,678
	$	29,299,963

Statement of Operations	Six Months ended June 30, 2017
Revenue	$	-
Operating expenses		35,156
Loss from operations		(35,156	)
Interest expense		33,669
Net loss	$	(68,825	)
Net loss attributable to BioHiTech Global, Inc. (17.2%)	$	(11,838	)

	Designated		Par		Stated		Shares Outstanding
Designation	Shares		Value		Value		March 31, 2020		December 31, 2019
Series A Convertible Preferred Stock		333,401	$	0.0001	$	5.00		145,312		145,312
Series B Convertible Preferred Stock		1,111,200		0.0001	$	5.00		-		-
Series C Convertible Preferred Stock		1,000,000		0.0001	$	10.00		427,500		427,500
Series D Convertible Preferred Stock		20,000		0.0001	$	100.00		18,850		18,850
Series E Convertible Preferred Stock		714,519		0.0001	$	2.64		264,519		264,519
Series F Convertible Preferred Stock		30,090		0.0001	$	115.00		13,045		-

Expiring During the Year Ending December 31,	Warrant Shares		Exercise Price per Share		Weighted Average Exercises Price per Share
2020		22,860		$3.50	$	3.50
2021		1,768,516		$1.80 to $3.75	$	3.25
2022		1,699,861		$1.80 to $5.00	$	2.60
2023		740,749		$1.80	$	1.80
2024		385,945		$1.80	$	1.80
2025		234,927		$2.25 to $2.30	$	2.29

Outstanding, January 1, 2020			4,674,261
Issued as a result of Series F Convertible Preferred Stock offering			178,597
Exercised			-
Expired			-
Outstanding, March 31, 2020			4,852,858

	Useful Lives (Years)	Remaining Weighted Average Life (Years)	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
September 30, 2017:
Distribution agreements	10	2.2	$	902,000	$	(705,317	)	$	196,683
Website	3	-		23,388		(23,388	)		-
Intangible assets, net			$	925,388	$	(728,705	)	$	196,683

December 31, 2016:
Distribution agreements	10	2.8	$	902,000	$	(637,667	)	$	264,333
Website	3	0.3		23,388		(20,679	)		2,709
Intangible assets, net			$	925,388	$	(658,346	)	$	267,042

	2020		2019
Stock options	$	48,460	$	58,388
Restricted stock		231,745		239,361
Total	$	280,205	$	297,749

	Number of Options		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in Years)		Aggregate Intrinsic Value
Outstanding – January 1, 2020		363,826	$	3.71		7.34		-
Granted		155,450		2.00		-		-
Exercised		-		-		-		-
Forfeited, Canceled or Expired		-		-		-		-
Outstanding – March 31, 2020		519,276	$	3.20		7.91		-
Exercisable – March 31, 2020		241,651	$	3.67		6.59		-

Year Ending December 31,
2017 (Remaining period)	$	22,550
2018		90,200
2019		43,533
2020		20,200
2021		20,200
Total	$	196,683

Balance, January 1, 2020	10	291,730
Grants		269,060
Forfeited		-
Vested		-
Balance, March 31, 2020		560,790

	United States		International		Total
2017:
Revenue, for the nine months ended September 30, 2017	$	1,421,711	$	374,533	$	1,796,244
Revenue, for the three months ended September 30, 2017	$	528,370	$	127,977	$	656,347
Non-current tangible assets, as of September 30, 2017	$	1,198,100	$	125,904	$	1,324,004

2016:
Revenue, for the nine months ended September 30, 2016	$	1,224,809	$	312,777	$	1,537,586
Revenue, for the three months ended September 30, 2016	$	469,419	$	154,159	$	623,578
Non-current tangible assets, as of December 31, 2016	$	1,019,664	$	71,596	$	1,091,260

	2020		2019
Revenue Type:
Rental of digesters	$	386,254	$	341,665
Services		601,433		372,975
Product sales		371,654		23,061
Total Revenue	$	1,359,341	$	737,701

Year Ending December 31,
2017 (Remaining period)	$	24,417
2018		98,524
2019		100,003
2020		41,926
Total	$	264,870

	September 30, 2017				December 31, 2016
	Net Total		Related Party*		Net Total		Related Party*
Line of credit	$	2,463,736	$	-	$	2,463,736	$	-
Unsecured subordinated mandatorily convertible notes:
Series A		3,383,952		2,250,000		3,310,500		2,250,000
Series B		1,870,634		1,750,000		1,220,634		1,250,000
Series D		1,993,875		325,000		-		-
Series V		425,000		300,000		425,000		300,000
Convertible note		191,032		-		-		-
Convertible note – Series C		939,186		450,000		-		-
Promissory note - related party		4,500,000		4,500,000		2,500,000		2,500,000
Notes payable		375,000		275,000		375,000		275,000
Advances		544,777		544,777		1,213,027		1,213,027
Long term debt - other, current and long term portion		13,204		-		19,573		-

Year Ending December 31,	Amortizing		Non- Amortizing^*		Optionally Convertible^*		Non-Amortizing Mandatorily Convertible^*		Total
2017 (Remaining period)	$	2,157	$	-	$	110,000	$	-	$	112,157
2018		5,410		-		1,360,000		5,725,000		7,090,410
2019		5,199		4,500,000		-		2,000,000		6.505,199
2020		438		375,000		-		-		375,438
Total	$	13,204	$	4,875,000	$	1,470,000	$	7,725,000	$	14,083,204

	Total Number of Options			Number of Exercisable Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in Years)		Aggregate Intrinsic Value
Outstanding at December 31, 2016		363,750			90,418		$	3.75		8.42		-
Granted or vested					79,091		$	3.75		8.42		-
Exercised								-		-		-
Forfeited, expired or canceled		(37,291	)		(11,805	)		3.75		-		-
Outstanding at September 30, 2017		326,459			157,704		$	3.75		8.42	$	894,498

Year Ending December 31,
2020 (remaining)	$	95,521
2021		109,000
2022		113,000
2023		113,000
2024 and thereafter		2,980,750
Total lease payments		3,411,271
Less imputed interest		(2,372,788	)
Present value of lease liabilities	$	1,038,483

	~~Number of~~ ~~Shares~~
~~Unvested balance at December 31, 2016~~		~~331,667~~
~~Granted~~		-
~~Vested~~		~~(75,000~~	)
~~Forfeited or Canceled~~		~~(10,555~~	)
~~Unvested balance at September 30, 2017~~		~~246,112~~

Year Ending December 31,
2017 (Remaining period)		30,146
2018		115,710
2019		100,003
2020		41,926
Total	$	287,785