UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
(Mark One)
☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended: February |
OR
☐ | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from ___________ to ___________ | |
Commission File Number: 333-226979 |
Assisted 4 Living, Inc. |
(Exact name of registrant as specified in its charter) |
Nevada | 82-1884480 | |
(State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.) | |
|
| |
(Address of principal executive offices) | (Zip Code) |
(888) 609-1169
(Registrant’s telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
None | None | None |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☒No ☐ No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes ☒ No ☐ No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer | ☐ | Accelerated filer | ☐ | ||
Non-accelerated filer | ☒ | Smaller reporting company | ☒ | ||
Emerging growth company | ☒ |
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 ☐ Yes No ☒ No
Indicate theThe number of shares outstanding of each of the issuer’s classes of common stock as of the latest practicable date. outstanding as of April
14,150,000 common shares issued and8, 2020.14, 2021 was 40,545,418 shares, par value $0.0001 per share.
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| Table of Contents |
PART I - FINANCIAL INFORMATION
ASSISTED 4 LIVING, INC.
UNAUDITED INTERIM UNAUDITED
FOR THE PERIOD ENDED FEBRUARY 29, 202028, 2021
INDEX TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Page | ||||||
F-2 | ||||||
F-3 | ||||||
F-4 | ||||||
F-5 | ||||||
F-6 | ||||||
| F-1 |
ASSISTED 4 LIVING, INC.
Condensed Consolidated Balance Sheets
(Unaudited)
|
| February 29, |
|
| November 30, |
| ||
|
| 2020 |
|
| 2019 |
| ||
ASSETS |
|
|
|
|
|
| ||
Current Assets |
|
|
|
|
|
| ||
Cash |
| $ | 4,737 |
|
| $ | 8,164 |
|
Prepaid expenses |
|
| — |
|
|
| 1,690 |
|
Total Current Assets |
|
| 4,737 |
|
|
| 9,854 |
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS |
| $ | 4,737 |
|
| $ | 9,854 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ DEFICIT |
|
|
|
|
|
|
| |
Current Liabilities |
|
|
|
|
|
|
|
|
Accounts payable and accrued liabilities |
| $ | 36,156 |
|
| $ | 42,581 |
|
Line of credit | 12,339 | — | ||||||
Deferred revenue and customer deposits | 800 | 6,700 | ||||||
Due to related parties |
|
| 5,556 |
|
|
| 5,556 |
|
Total Current Liabilities |
|
| 54,851 |
|
|
| 54,837 |
|
|
|
|
|
|
|
|
|
|
Total Liabilities |
|
| 54,851 |
|
|
| 54,837 |
|
|
|
|
|
|
|
|
|
|
Stockholders’ Deficit |
|
|
|
|
|
|
|
|
Preferred stock: 25,000,000 shares authorized; $0.0001 par value 0 shares issued and outstanding |
|
|
|
|
|
| ||
Common stock: 100,000,000 shares authorized; $0.0001 par value 14,150,000 shares issued and outstanding |
|
| 1,415 |
|
|
| 1,415 |
|
Additional paid in capital |
|
| 71,085 |
|
|
| 71,085 |
|
Accumulated deficit |
|
| (122,614 | ) |
|
| (117,483 | ) |
Total Stockholders’ Deficit |
| (50,114 | ) |
|
| (44,983 | ) | |
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT |
| $ | 4,737 |
|
| $ | 9,854 |
|
|
| February 28, |
|
| November 30, |
| ||
|
| 2021 |
|
| 2020 |
| ||
ASSETS |
|
|
|
|
|
| ||
Current Assets |
|
|
|
|
|
| ||
Cash |
| $ | 2,200,752 |
|
| $ | 242,768 |
|
Accounts receivable |
|
| 3,935 |
|
|
| 0 |
|
Other current asset |
|
| 2,500 |
|
|
| 2,500 |
|
Total Current Assets |
|
| 2,207,187 |
|
|
| 245,268 |
|
|
|
|
|
|
|
|
|
|
Right of use asset |
|
| 9,783 |
|
|
| 19,542 |
|
TOTAL ASSETS |
| $ | 2,216,970 |
|
| $ | 264,810 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
Current Liabilities |
|
|
|
|
|
|
|
|
Accounts payable and accrued liabilities |
| $ | 387,218 |
|
| $ | 127,255 |
|
Line of credit |
|
| 3,955 |
|
|
| 4,924 |
|
Loan payable |
|
| 0 |
|
|
| 20,590 |
|
Deferred revenue and customer deposits |
|
| 10,400 |
|
|
| 5,500 |
|
Lease liability |
|
| 7,783 |
|
|
| 17,542 |
|
Due to related parties |
|
| 8,431 |
|
|
| 8,356 |
|
Total Current Liabilities |
|
| 417,787 |
|
|
| 184,167 |
|
|
|
|
|
|
|
|
|
|
Total Liabilities |
|
| 417,787 |
|
|
| 184,167 |
|
|
|
|
|
|
|
|
|
|
Stockholders’ Equity |
|
|
|
|
|
|
|
|
Preferred stock: 25,000,000 shares authorized; $0.0001 par value no shares issued and outstanding |
|
| 0 |
|
|
| 0 |
|
Common stock: 100,000,000 shares authorized; $0.0001 par value 28,690,000 and 24,150,000 shares issued and outstanding, respectively |
|
| 2,869 |
|
|
| 2,415 |
|
Additional paid in capital |
|
| 2,580,849 |
|
|
| 311,303 |
|
Accumulated deficit |
|
| (784,535 | ) |
|
| (233,075 | ) |
Total Stockholders’ Equity |
|
| 1,799,183 |
|
|
| 80,643 |
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
| $ | 2,216,970 |
|
| $ | 264,810 |
|
The accompanying notes are an integral part of these unaudited condensed consolidated financial statementsstatements.
| F-2 |
ASSISTED 4 LIVING, INC.
Condensed Consolidated Statements of Operations
(Unaudited)
Three Months Ended | ||||||||
|
| February 29, |
|
| February 28, |
| ||
|
| 2020 |
|
| 2019 |
| ||
Revenue |
| $ | 212,896 |
|
| $ | 4,500 |
|
Cost of service |
|
| (113,502 | ) |
|
| — |
|
Gross Profit | 99,394 | 4,500 | ||||||
Operating Expenses: |
|
|
|
|
|
|
|
|
General and administrative |
|
| 92,313 |
|
|
| 5,352 |
|
Professional fees |
|
| 12,225 |
|
|
| 8,615 |
|
Total operating expenses |
|
| 104,538 |
|
|
| 13,967 |
|
|
|
|
|
|
|
|
|
|
Operating Loss |
|
| (5,144 | ) |
|
| (9,467 | ) |
|
|
|
|
|
|
|
|
|
Other income (expense) | ||||||||
Interest expense, net | (803 | ) | — | |||||
Other income | 816 | — | ||||||
Total other expenses | 13 | — | ||||||
Net loss before income taxes | (5,131) | (9,467) | ||||||
Provision for income tax |
| — |
|
|
| — |
| |
Net Loss |
| $ | (5,131 | ) |
| $ | (9,467 | ) |
|
|
|
|
|
|
|
|
|
Basic and Diluted Loss per Common Share |
| $ | (0.00 | ) |
| $ | (0.00 | ) |
Basic and Diluted Weighted Average Common Shares Outstanding |
|
| 14,150,000 |
|
|
| 13,536,667 |
|
|
| Three Months Ended |
| |||||
|
| February 28, |
|
| February 29, |
| ||
|
| 2021 |
|
| 2020 |
| ||
|
|
|
|
|
|
| ||
Revenue |
| $ | 212,105 |
|
| $ | 212,896 |
|
|
|
|
|
|
|
|
|
|
Operating Expenses: |
|
|
|
|
|
|
|
|
Direct cost |
|
| 46,610 |
|
|
| 13,042 |
|
General and administrative |
|
| 71,261 |
|
|
| 92,313 |
|
Salary expense |
|
| 187,276 |
|
|
| 100,460 |
|
Professional fees |
|
| 477,387 |
|
|
| 12,225 |
|
Total operating expenses |
|
| 782,534 |
|
|
| 218,040 |
|
|
|
|
|
|
|
|
|
|
Operating loss |
|
| (570,429 | ) |
|
| (5,144 | ) |
|
|
|
|
|
|
|
|
|
Other income (expense) |
|
|
|
|
|
|
|
|
Interest expense |
|
| (1,621 | ) |
|
| (803 | ) |
Other income |
|
| 0 |
|
|
| 816 |
|
Forgiveness on loan payable |
|
| 20,590 |
|
|
| 0 |
|
Total other income (expense) |
|
| 18,969 |
|
|
| 13 |
|
|
|
|
|
|
|
|
|
|
Net loss before income taxes |
|
| (551,460 | ) |
|
| (5,131 | ) |
Provision for income tax |
|
| 0 |
|
|
| 0 |
|
Net loss |
| $ | (551,460 | ) |
| $ | (5,131 | ) |
|
|
|
|
|
|
|
|
|
Basic and Diluted Loss per Common Share |
| $ | (0.02 | ) |
| $ | (0.00 | ) |
Basic and Diluted Weighted Average Common Shares Outstanding |
|
| 25,117,667 |
|
|
| 14,150,000 |
|
The accompanying notes are an integral part of these unaudited condensed consolidated financial statementsstatements.
| F-3 |
ASSISTED 4 LIVING, INC.
Condensed Consolidated Statements of Changes in Stockholders’ Equity (Deficit)
(Unaudited)
For the Three months ended February 28, 2021
|
|
|
|
|
|
|
| Additional |
|
|
|
|
|
|
| |||||
|
| Common Stock |
|
| Paid in |
|
| Accumulated |
|
|
|
| ||||||||
|
| Shares |
|
| Amount |
|
| Capital |
|
| Deficit |
|
| Total |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Balance As At November 30, 2020 |
|
| 24,150,000 |
|
| $ | 2,415 |
|
| $ | 311,303 |
|
| $ | (233,075 | ) |
| $ | 80,643 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of common shares for cash |
|
| 4,540,000 |
|
|
| 454 |
|
|
| 2,269,546 |
|
|
| 0 |
|
|
| 2,270,000 |
|
Net loss for the period |
|
| - |
|
|
| 0 |
|
|
| 0 |
|
|
| (551,460 | ) |
|
| (551,460 | ) |
Balance As At February 28, 2021 |
|
| 28,690,000 |
|
| $ | 2,869 |
|
| $ | 2,580,849 |
|
| $ | (784,535 | ) |
| $ | 1,799,183 |
|
For the Three Months Ended February 29, 2020
|
|
|
|
|
|
|
| Additional |
|
|
|
|
|
|
| ||||||
|
| Common Stock |
|
| Paid in |
|
| Accumulated |
|
|
|
| |||||||||
|
| Shares |
|
| Amount |
|
| Capital |
|
| Deficit |
|
| Total |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Balance - November 30, 2019 |
|
| 14,150,000 |
|
| $ | 1,415 |
|
| $ | 71,085 |
|
| $ | (117,483 | ) |
| $ | (44,983 | ) | |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
Net loss for the period |
|
| — |
|
|
| — |
|
|
| — |
|
|
| (5,131 | ) |
|
| (5,131 | ) | |
Balance - February 28, 2020 |
|
| 14,150,000 |
|
| $ | 1,415 |
|
| $ | 71,085 |
|
| $ | (122,614 | ) |
| $ | (50,114 | ) | |
For the Three Months Ended February 28, 2019
|
|
|
|
|
|
|
| Additional |
|
|
|
|
|
|
| |||||
|
| Common Stock |
|
| Paid in |
|
| Accumulated |
|
|
|
| ||||||||
|
| Shares |
|
| Amount |
|
| Capital |
|
| Deficit |
|
| Total |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Balance - November 30, 2018 |
|
| 13,050,000 |
|
| $ | 1,305 |
|
| $ | 49,195 |
|
| $ | (32,362 | ) |
| $ | 18,138 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of common shares at $0.02 per share |
|
| 1,100,000 |
|
|
| 110 |
|
|
| 21,890 |
|
|
| — |
|
|
| 22,000 |
|
Net loss for the period |
|
| — |
|
|
| — |
|
|
| — |
|
|
| (9,467 | ) |
|
| (9,467 | ) |
Balance - February 28, 2019 |
|
| 14,150,000 |
|
| $ | 1,415 |
|
| $ | 71,085 |
|
| $ | (41,829 | ) |
| $ | 30,671 |
|
|
|
|
|
|
|
|
| Additional |
|
|
|
|
|
|
| |||||
|
| Common Stock |
|
| Paid in |
|
| Accumulated |
|
|
|
| ||||||||
|
| Shares |
|
| Amount |
|
| Capital |
|
| Deficit |
|
| Total |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Balance As At November 30, 2019 |
|
| 14,150,000 |
|
| $ | 1,415 |
|
| $ | 71,085 |
|
| $ | (117,483 | ) |
| $ | (44,983 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss for the period |
|
| - |
|
|
| 0 |
|
|
| 0 |
|
|
| (5,131 | ) |
|
| (5,131 | ) |
Balance As At February 29, 2020 |
|
| 14,150,000 |
|
| $ | 1,415 |
|
| $ | 71,085 |
|
| $ | (122,614 | ) |
| $ | (50,114 | ) |
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
| F-4 |
ASSISTED 4 LIVING, INC.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
|
| Three Months Ended |
| |||||
February 29, | February 28, | |||||||
|
| 2020 |
|
| 2019 |
| ||
|
|
|
|
|
|
| ||
CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
|
|
|
| ||
Net loss |
| $ | (5,131 | ) |
| $ | (9,467 | ) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
Changes in current assets and liabilities: |
|
|
|
|
|
|
|
|
Prepaid expenses |
|
| 1,690 |
|
|
| — | |
Accounts payable and accrued liabilities |
| (6,425) |
|
|
| 2,526 |
| |
Deferred revenue and customer deposists |
|
| (5,900 | ) |
|
| - |
|
Net Cash Used in Operating Activities |
|
| (15,766 | ) |
|
| (6,941 | ) |
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES |
|
|
|
|
|
|
|
|
Issuance of common stock |
|
| — |
|
|
| 22,000 |
|
Net proceeds from line of credit | 12,339 | — | ||||||
Net Cash Provided by Financing Activities |
|
| 12,339 |
|
|
| 22,000 |
|
|
|
|
|
|
|
|
|
|
Net change in cash for the period |
|
| (3,427 | ) |
|
| 15,059 |
|
Cash at beginning of period |
|
| 8,164 |
|
|
| 21,019 |
|
Cash at end of period |
| $ | 4,737 |
|
| $ | 36,078 |
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL CASH FLOW INFORMATION: |
|
|
|
|
|
|
|
|
Cash paid for income taxes |
| $ | — |
|
| $ | — |
|
Cash paid for interest |
| $ | — |
|
| $ | — |
|
|
| Three Months Ended |
| |||||
|
| February 28, |
|
| February 29, |
| ||
|
| 2021 |
|
| 2020 |
| ||
|
|
|
|
|
|
| ||
CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
|
|
|
| ||
Net loss |
| $ | (551,460 | ) |
| $ | (5,131 | ) |
Adjustments to reconcile net loss to net cash used in operating activities: |
|
|
|
|
|
|
|
|
Forgiveness of loan payable |
|
| (20,590 | ) |
|
| 0 |
|
Changes in current assets and liabilities: |
|
|
|
|
|
|
|
|
Accounts receivable |
|
| (3,935 | ) |
|
| 0 |
|
Prepaid expenses and other current assets |
|
| 0 |
|
|
| 1,690 |
|
Accounts payable and accrued liabilities |
|
| 259,963 |
|
|
| (6,425 | ) |
Deferred revenue and customer deposits |
|
| 4,900 |
|
|
| (5,900 | ) |
Net cash used in operating activities |
|
| (311,122 | ) |
|
| (15,766 | ) |
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES |
|
|
|
|
|
|
|
|
Proceeds from issuance of common stock |
|
| 2,270,000 |
|
|
| 0 |
|
Proceeds from related party |
|
| 75 |
|
|
| 0 |
|
Line of credit, net |
|
| (969 | ) |
|
| 12,339 |
|
Net cash provided by financing activities |
|
| 2,269,106 |
|
|
| 12,339 |
|
|
|
|
|
|
|
|
|
|
Net change in cash for the period |
|
| 1,957,984 |
|
|
| (3,427 | ) |
Cash at beginning of period |
|
| 242,768 |
|
|
| 8,164 |
|
Cash at end of period |
| $ | 2,200,752 |
|
| $ | 4,737 |
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL CASH FLOW INFORMATION: |
|
|
|
|
|
|
|
|
Cash paid for income taxes |
| $ | 0 |
|
| $ | 0 |
|
Cash paid for interest |
| $ | 218 |
|
| $ | 0 |
|
The accompanying notes are an integral part of these unaudited condensed consolidated financial statementsstatements.
| F-5 |
| Table of Contents |
ASSISTED 4 LIVING, INC.
Notes to the Condensed Consolidated Financial Statements
February 29, 202028, 2021
(Unaudited)
NOTE 1 – ORGANIZATION, DESCRIPTION OF BUSINESS AND GOING CONCERN
Assisted 4 Living, Inc., (“Assisted 4 Living,” “the Company,” “we” or “us”) was incorporated in the state of Nevada on May 24, 2017. It is based in North Port, Florida. The Company incorporated a wholly-owned subsidiary, “Assisted 2 Live, Inc.” in the state of Florida on June 15, 2017. The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America, and the Company’s fiscal year end is November 30.
The Company operates as an assisted living consulting company that specializes in acquiring, licensing, staffing, and operating assisted living facilities (“ALF”). The Company offers clients that wish to enter the ALF field an opportunity to purchase and run its own center(s), and will also act as a referral agent for finding and placing clients that are in search of quality residential care. The Company will also offer a la carte consulting services such as submitting license applications, developing emergency plans, as well as other regulatory and compliance needs. The Company has operated its assisted living facility operation since March 1, 2019.
Going Concern
The accompanying unaudited consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. As of February 29, 2020, the Company has an accumulated deficit.
The ability of the Company to obtain profitability is dependent upon, among other things, obtaining additional financing to continue operations, and development of its business plan. In response to these problems, management intends to raise additional operating funds through equity and/or debt offerings. However, there can be no assurance management will be successful in its endeavors.
There are no assurances that the Company will be able to either (1) achieve a level of revenues adequate to generate sufficient cash flow from operations; or (2) obtain additional financing through either private placement, public offerings and/or bank financing necessary to support its working capital requirements. To the extent that funds generated from operations and any private placements, public offerings and/or bank financing are insufficient, the Company will have to raise additional working capital. No assurance can be given that additional financing will be available, or if available, will be on terms acceptable to the Company. If adequate working capital is not available to the Company, it may be required to curtail or cease its operations.
These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern. The accompanying consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
NOTE 21 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying unaudited condensed consolidated financial statements of Assisted 4 Living, Inc. (“Assisted,” the “Company,” “we” or “us”), have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial statements and with the instructions to Form 10-Q and Regulation S-X of the United States Securities and Exchange Commission (“SEC”). Accordingly, they do not contain all information and footnotes required by accounting principles generally accepted in the United States of America for annual financial statements.
In the opinion of the Company’s management, the accompanying unaudited condensed consolidated financial statements contain all the adjustments necessary (consisting only of normal recurring accruals) to present the financial position of the Company as of February 29, 202028, 2021 and the results of operations and cash flows for the periods presented. The results of operations for the three months ended February 29, 202028, 2021 are not necessarily indicative of the operating results for the full fiscal year or any future period. These unaudited condensed consolidated financial statements should be read in conjunction with the condensed consolidated financial statements and related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended November 30, 20192020 filed with the SEC on February 28, 2020.March 1, 2021.
Basis of Consolidation
These condensed consolidated financial statements include the accounts of the Company and the wholly-owned subsidiary, Assisted 2 Live, Inc. All material intercompany balances and transactions have been eliminated.
Use of Estimates and Assumptions
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements. The estimates and judgments will also affect the reported amounts for certain revenues and expenses during the reporting period. Actual results could differ from these good faith estimates and judgments.
Revenue Recognition
Revenue Recognition
The Company follows ASC 606, “”Revenue from Contracts with Customers.” Revenues are recognized when control of the promised goods or services are transferred to a customer, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services. The Company derives its revenues from the rendering of business advisory services, such as training, implementation, consulting and other customer-specific services. The five step model defined by ASC Topic 606 requires us to: (1) identify our contracts with customers, (2) identify our performance obligations under those contracts, (3) determine the transaction prices of those contracts, (4) allocate the transaction prices to our performance obligations in those contracts and (5) recognize revenue when each performance obligation under those contracts is satisfied. Revenue is recognized when promised goods or services are transferred to the customer in an amount that reflects the consideration expected in exchange for those goods or services.
Resident fees at our independent senior living and assisted living community consists of regular monthly charges for basic housing and support services and fees for additional requested services, such as assisted living services, personalized health services and ancillary services. Fees are specified in our agreements with residents, which are generally 30-day terms, with regular monthly charges billed in advance on the first day of each month.
Leases
In February 2016,Reclassification
Certain amounts from prior periods have been reclassified to conform to the FASB established Topic 842, Leases, by issuing Accounting Standards Update (ASU) No. 2016-02, which requires lessees to recognize leases on balance sheet and disclose key information about the leasing arrangements. The new standard establishes a right-of-use model (“ROU”) that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term longer than 12 months.Leases with a lease term of 12 months or less at inception are not recorded on our consolidated balance sheet and are expensed on a straight-line basis over the lease term in our consolidated statement of income.
The new standard was effective for the Company on December 1, 2019, with early adoption permitted. The Company chose to use either (1) its effective date or (2) the beginning of the earliest comparativecurrent period presented in the financial statements as its date of initial application. The Company adopted the new standard on December 1, 2019 and will use the effective date as our date of initial application. Consequently, financial information is not provided for the dates and periods before December 1, 2019. The new standard provides a number of optional expedients in transition. The Company elected the package of practical expedients which permits the Company not to reassess under the new standard our prior conclusions about lease identification, lease classification and initial direct costs. The Company continues expensing leases that have a term of 12 months of less.presentation.
| F-6 |
| Table of Contents |
Recent Accounting PronouncementsCOVID-19
In March 2020, the World Health Organization declared the outbreak of COVID-19 as a pandemic based on the rapid increase in global exposure. COVID-19 continues to spread throughout the world. The Company is closely monitoring developments and is taking steps to mitigate the potential risks related to the COVID-19 pandemic to the Company, its employees, as well as its residential and consulting clients.
While COVID-19 has reviewed all other recently issued, but not, yet effective, accounting pronouncementsto date, negatively impacted our revenues, the virus outbreak has materially impacted the operations at our Punta Gorda ALF, and does not believemay in the future adoption ofimpact our ALF and consulting businesses and revenues generated therefrom.
Going forward any such pronouncementsadditional safety and operational guidance and/or regulations may be expected to causehave a material impact on the operating costs related to our financial statements.ALF. Such increased operating costs may or may not be offset by increased charges related thereto. Furthermore, the contraction of COVID-19 by any employees or residents of our ALF, and any resulting negative health consequences arising therefrom, may have a materially negative affect on our ability to continue generating revenues from our ALF and could, in extreme cases result in us closing down our ALF due to safety and/or liability concerns
NOTE 32 – ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
Accounts payable and accrued liabilities at February 29, 202028, 2021 and November 30, 20192020 consist of the following:
| February 29, | November 30, | |||||||
| 2020 | 2019 | |||||||
| Trade accounts | $ | 11,632 | $ | 9,282 | ||||
| Credit card | 18,569 | 18,240 | ||||||
| Accrued salary | 5,620 | 14,724 | ||||||
| Sales tax payable | 335 | 335 | ||||||
Total | $ | 36,156 | $ | 42,581 | ||||
|
| February 28, |
|
| November 30, |
| ||
|
| 2021 |
|
| 2020 |
| ||
Trade accounts |
| $ | 5,918 |
|
| $ | 67,910 |
|
Credit card |
|
| 10,487 |
|
|
| 18,571 |
|
Accrued expense |
|
| 350,000 |
|
|
| 24,000 |
|
Accrued salary |
|
| 10,342 |
|
|
| 16,439 |
|
Sales tax payable |
|
| 335 |
|
|
| 335 |
|
Payroll tax payable |
|
| 10,136 |
|
|
| 0 |
|
|
| $ | 387,218 |
|
| $ | 127,255 |
|
NOTE 3 – LOAN PAYABLE
On May 4, 2020, the Company received a $20,590 loan pursuant to the Paycheck Protection Program established under the Cares Act (the “PPP Loan”). The PPP Loan had a two-year term and interest at a rate of 1.0% per annum. Monthly principal and interest payments were deferred for six months after the date of disbursement. The PPP Loan may be prepaid at any time prior to maturity with no prepayment penalties. The PPP Loan contains events of default and other provisions customary for a loan of this type.
On January 19, 2021, the Company recorded $20,590 for other income, on the forgiveness of this PPP Loan.
NOTE 4 - RELATED PARTY TRANSACTIONS
During the three months ended February 29,28, 2021 and 2020, and February 28, 2019, the Company incurred consulting fees from a company controlled by the CEO of our CEO,subsidiary, in the total amount of $6,100 and $7,500, respectively.
During the three months ended February 28, 2021 and 2020, the Company paid officer’s salaries of $80,769 and, $0, respectively.
On February 1, 2021 (the “Effective Date”), the Company signed an employment agreement with our new CEO, Louis Collier (“Collier”). Collier will be paid a base salary of $400,000, which will be reassessed and renegotiated in good faith after the Company is profitable over a fiscal year. The Company does not have employment contracts with its officers.will also pay Collier a signing bonus of $150,000, which will be payable as follows: $50,000 within five days of the Effective Date (paid); $50,000 within 90 days of the Effective Date; and $50,000 within 180 days of the Effective Date. Collier will also be issued 1,250,000 phantom shares within ten days after the Company approves and adopts a Phantom Equity Plan. The phantom shares will be subject to a phantom unit interest award agreement, which will set forth the vesting of the phantom shares.
| F-7 |
| Table of Contents |
NOTE 5 – COMMITMENTLEASE
On March 7, 2019, the Company entered into thea commercial real estate lease agreement. The Company leases anagreement for its adult living facility building forfacility. The initial terms were $3,713 monthly fromfor the period of March 7, 2019 until January 7, 2020. The term may be extended at the sole discretion of the landlord.
On January 8, 2020, the Company renewed its adult living facility lease agreement through May 1, 2020, on which date the Company entered into thea new commercial real estate lease agreement. The Company leases an adult living facility building for $3,713revised terms are $3,265 monthly payments from January 8May 1, 2020 until January 7,May 31, 2021.
Our lease meets the definition ofshort-term lease because the lease term is 12 months or less. Consequently, consistent with Company’s accounting policy election,result, the Company does not recognize the right-of-userecognized a right of use asset (“ROU Asset”) and the lease liability arising from this lease.of $42,253.
In accordance with ASC 842, the Company recorded the operating lease ROU Asset and lease liability as follows:
|
| February 28, |
|
| November 30, |
| ||
|
| 2021 |
|
| 2020 |
| ||
ROU asset |
| $ | 9,783 |
|
| $ | 19,542 |
|
|
| February 28, |
|
| November 30, |
| ||
|
| 2021 |
|
| 2020 |
| ||
Operating lease liability: |
|
|
|
|
|
| ||
Current |
| $ | 7,783 |
|
| $ | 17,542 |
|
Non-Current |
|
| 0 |
|
|
| 0 |
|
|
| $ | 7,783 |
|
| $ | 17,542 |
|
Information associated with the measurement of our remaining operating lease obligations as of February 28, 2021 is as follows:
Remaining lease term | 0.25 year | |||
Discount rate | 1.00 | % | ||
Future minimum lease payments under operating leases at February 28, 2021 were as follows:
2021 |
| $ | 7,795 |
|
Thereafter |
|
| 0 |
|
Total |
|
| 7,795 |
|
Less: Imputed interest |
|
| (12 | ) |
Operating lease liabilities |
| $ | 7,783 |
|
During the three months ended February 29, 202028, 2021 and February 28, 2019,29, 2020, the Company recorded rent expense of $11,139$9,739 and $0,$11,140, respectively.
NOTE 6 – Subsequent Events- EQUITY
SubsequentPreferred Stock
The Company has authorized 25,000,000 preferred shares with a par value of $0.0001 per share. The Board of Directors are authorized to divide the authorized shares of Preferred Stock into one or more series, each of which shall be so designated as to distinguish the shares thereof from the shares of all other series and classes.
As of February 29,28, 2021 and November 30, 2020, the Company had no classes of preferred shares designated.
| F-8 |
| Table of Contents |
Common Stock
The Company has authorized 100,000,000 common shares with a par value of $0.0001 per share. Each common share entitles the holder to one vote, in person or proxy, on any matter on which action of the stockholders of the corporation is sought.
During the three months ended February 28, 2021, the Company issued to unaffiliated investors 4,540,000 shares of common stock at $0.50 per share for $2,270,000.
As of February 28, 2021 and November 30, 2020, the Company had 28,690,000 and 24,150,000 common shares issued and outstanding, respectively.
NOTE 7 – SUBSEQUENT EVENTS
The Company has evaluated subsequent events from February 28, 2021 through the date these financial statements were issued and determined the following events require disclosure:
During the period from March 6 through April 9, 2021, the Company had no subsequent eventsissued an aggregate of 3,690,000 shares of common stock to report.18 investors at a price of $0.50 per share for aggregate proceeds of $1,845,000.
Trillium Healthcare Croup, LLC
The Company entered into a Second Amendment dated April 5, 2021 to that certain Membership Interest Purchase Agreement dated as of January 29, 2021, (the "Purchase Agreement") by and among the Company, Richard T. Mason (“Mason”), G. Shayne Bench (“Bench”) and Trillium Healthcare Group, LLC, a Florida limited liability company (“Trillium”) to acquire all of the issued and outstanding ownership interests of Fairway Healthcare Properties, LLC and Trillium Healthcare Consulting, LLC from Trillium. The Company previously disclosed entering into the Second Amendment in a Current Report on Form 8-K filed with the SEC on April 8, 2021. The Second Amendment amends and restates certain sections of the Purchase Agreement to: (1) provide for an extension of the Company’s due diligence review period; and (2) accommodate a change in the form of the consideration to be paid for the Interests.
The Second Amendment amends and restates Section 5.18(b) of the Purchase Agreement and provides the Company with a longer review period following the Company’s receipt of seller’s initial disclosure schedule. The Company now has until April 15, 2021 to review such material. If any diligence requests or follow-up requests remain unsatisfied, and/or the Company is continuing to negotiate in good faith in connection with information relating to seller’s disclosure schedule, the Company’s review period is automatically extended for 15 days, to April 30, 2021.
The Second Amendment also amends and restates several sections of the Purchase Agreement in connection with a change in the form of the consideration to be paid for the Interests. Certain Sections were amended and restated to provide for: (1) a reduction in the minimum amount of cash seller is required to have on hand at closing from $11,100,000 to $9,100,000; (2) a reduction in the cash purchase price to be paid to the seller from $9,000,000 to $4,000,000, of which $2,000,000 is to be paid at closing and the remaining $2,000,000 paid on or before the earlier of the date that is: (i) 30 days following the closing of a public offering of the Company’s common stock; (ii) ten days following a determination by the Company’s board of directors, in its sole discretion, that Buyer has sufficient surplus cash from which to pay the $2,000,000; or (iii) ten days following the one year anniversary of the transaction closing date; and (3) to offset the reduction in the cash portion of the purchase price, the issuance of shares of the Company’s common stock valued at $5,000,000 (based on a price per share determined at the time of issuance as described in the Second Amendment) on or before the earlier of the date that is: (i) 30 days following the closing of a registered public offering of the Company’s common stock; or (ii) ten days following the one year anniversary of the transaction closing date.
| Table of Contents |
Florida Nursing Facility
On March 10, 2021, the Company entered into an asset purchase Agreement between the Company, 207 Marshall Drive Operations LLC and 803 Oak Street Operations LLC. Each seller is the tenant and operator of a skilled nursing facility located in Florida. On March 1, 2021, each seller filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code with the United States Bankruptcy Court for the District of Delaware. The Company previously disclosed entering into the purchase agreement in a Current Report on Form 8-K filed with the SEC on March 16, 2021.
The purchase agreement provides for the sale by the sellers to the Company of the assets associated with the facilities, other than accounts receivables relating to periods prior to the closing, subject to the approval of the Bankruptcy Court and entry of a sale order determining the Company to be the successful bidder, and pursuant to the terms of such sale order. Subject to the terms of the purchase agreement, the Company is acquiring the assets from the sellers in exchange for $2,000,000 and the assumption of certain liabilities. The Company paid a $200,000 deposit upon execution of the purchase agreement, which will be applied to the purchase price at closing. The transaction is expected to close shortly after the sale hearing date currently scheduled for May 13, 2021, subject to the Company’s approval of disclosure schedules to be provided by the sellers, and other customary closing conditions.
Banyan Pediatric Care Centers, Inc.
On March 23, 2021, the Company entered into a Plan of Merger by and among itself, its wholly owned subsidiary, BPCC Acquisition, Inc., a Florida corporation, and Banyan Pediatric Care Centers, Inc., a Florida corporation ("Banyan"). Under the terms of the Plan of Merger, BPCC Acquisition, Inc merged with and into Banyan with Banyan surviving the merger and becoming a wholly-owned subsidiary of the Company (the "Merger"). The Company previously disclosed entering into the Plan of Merger in a Current Report on Form 8-K filed with the SEC on April 8, 2021.
At the effective time of the Merger on March 23, 2021:
· | Banyan’s 49,984,649 outstanding shares of common stock, held by 64 shareholders, were converted into and exchanged for the right to receive 4,165,418 shares of the Company’s validly issued, fully paid and nonassessable shares of common stock, based on an exchange ratio of one (1) share of common stock of the Company for every twelve (12) shares of Banyan common stock. All fractional shares were rounded up to the next whole share. The pre-Merger shareholders of the Company retained an aggregate of 31,230,000 shares of outstanding common stock, representing approximately 79% ownership of the outstanding shares of common stock of the Company post-Merger. Therefore, upon consummation of the Merger, there was not a change in control of the Company. | |
· | Banyan’s outstanding warrant to purchase 900,000 shares of common stock was converted into and exchanged for a warrant to purchase 75,000 shares of the Company’s common stock (the “Warrant”) at an exercise price of $0.38 per share. The Warrant is exercisable for cash only. The number of shares of common stock deliverable upon exercise of the Warrant is subject to adjustment for subdivision or consolidation of shares and other standard dilutive events. | |
· | Banyan’s $2,300,000 of outstanding debt was assumed by the surviving corporation, and the $2,000,000 of such debt that was convertible into 20,000,000 shares of Banyan common stock was converted at $0.50 per share into 4,000,000 shares of common stock of the Company, effective as of April 12, 2021. The $300,000 of outstanding debt, evidenced by a promissory note dated November 6, 2020, accrues interest at the annual rate of 12%, payable on the sixth day of each month in the amount of $3,000 until the maturity date of the Note on November 6, 2021, at which time, the remaining principal balance, if any, shall be due and payable. There is a prepayment charge if any portion of the principal is paid prior to May 6, 2021, then Banyan must pay a prepayment fee calculated as the difference between six (6) months of interest on the amount of principal being prepaid and the amount of interest paid to date on the amount of principal being prepaid. |
The Merger was treated as a recapitalization and reverse acquisition of the Company, and Banyan is considered the acquirer, for financial accounting purposes.
| F-10 |
| Table of Contents |
Item 2. Management'sManagement’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis of our results of operations and financial condition for period ended February 28, 2021, should be read in conjunction with our consolidated financial statements and the related notes and the other financial information that appearare included elsewhere in this quarterly report. The followingQuarterly Report. This discussion containsincludes forward-looking statements based upon current expectations that reflectinvolve risks and uncertainties, such as our plans, objectives, expectations and intentions. Forward-looking statements are statements not based on historical information and which relate to future operations, strategies, financial results, or other developments. Forward-looking statements are based upon estimates, forecasts and beliefs. Ourassumptions that are inherently subject to significant business, economic, and competitive uncertainties and contingencies, many of which are beyond our control and many of which, with respect to future business decisions, are subject to change. These uncertainties and contingencies can affect actual results and could cause actual results to differ materially from those expressed in any forward-looking statements. Actual results and the timing of events could differ materially from those discussedanticipated in thethese forward-looking statements. Factors that could cause or contributestatements as a result of a number of factors. We use words such as “anticipate,” “estimate,” “plan,” “project,” “continuing,” “ongoing,” “expect,” “believe,” “intend,” “may,” “will,” “should,” “could,” and similar expressions to such differences include, but are not limited to, those discussed below and elsewhere in this quarterly report.
In this quarterly report, unless otherwise specified, all dollar amounts are expressed in United States dollars and all references to “common shares” refer to the common shares in our capital stock.
As used in this quarterly report, the terms “we,” “us,” “our” and “our Company”“Company” mean Assisted 4 Living, Inc. (“A4L” or the “Company”), and our wholly ownedwholly-owned subsidiary, Assisted 2 Live, Inc. a Florida corporation, unless otherwise indicated.
General Overview
We were incorporated in Nevada on May 24, 2017, with an objective to operate as a facilitator of assisted living projects and related services. Our Company has positioned itself as a go-to resource for individuals or private groups that wish to enter and operate within the Assisted Living Facility (“ALF”) industry. Our Company’s first target market will beis Florida, and will operateoperates an assisted living facility within the State through our solely ownedsolely-owned subsidiary Assisted 2 Live, Inc. The goal being to use Florida as a test market to streamline our consulting processes and ultimately transition to a national company in the assisted living field. The barriers to entering the ALF space are considerable and require a detailed understanding of each State’s regulatory environment and processes. There are a myriad of steps that must be navigated to properly set up an ALF residence; including, but not limited to, licensing, complying with building codes, medical care requirements, staffing and industry regulations. Our Company is designed to mentor prospective ALF clients and guide them through every step of the start-up process, working hand-in-hand with them to ensure that their facility begins operating properly and sustainably.
We have a wholly-owned subsidiary, Assisted 2 Live, Inc., a Florida corporation ("A2L"(“A2L”), which was incorporated on June 15, 2017.
Our principal executive office is located at 2382 Bartek Pl., North Port, FL 342896801 Energy Court, Suite 201 Sarasota, Florida 34240 and our telephone number is (888) 609-1169. Our office is provided to us at no charge by our largest shareholder and former President. Our corporate website is www.assisted4living.com.
We have not been subject to any bankruptcy, receivership or similar proceeding.
Our Current Business
On March 1, 2019, our Company took over the management of a 28-bed assisted living facility in Punta Gorda, FL. Our Company is responsible for all aspects of its operations from the care of the residents, to the staffing, cooking, and collection of rent.
On March 7, 2019, we entered into the assisted living facility premisescommercial real estate lease agreement. We lease, through A2L, an adult ALF building for $3,713 monthly. On January 8, 2020, we renewed the lease agreement through May 1, 2020, on which date we entered into a new commercial real estate lease agreement. The revised terms are $3,265 monthly payments from a third-party landlord and is contracted to pay monthly rent of $3,713. May 1, 2020 until May 31, 2021.
| 3 |
| Table of Contents |
We possess all of our State and County accreditations (licenses) to run the facility for the next 2 years.
In growing the business solely from a consulting firm to also operating a physical brick and mortar facility, our Company seeks to diversify our business model and capitalize on opportunities, to expand our revnuerevenue stream, as they arise. Our Company will still assist outside clients that wish to start and operate their own facility,facility; however, in securing our own physical location our Company can grow revenues, secure our foothold in a growing assisted living market, and use our location as a training center for new clients wishing to enter the field. Our Company is also actively searching for other nearby properties to convert into an assisted living facility, or that perhaps are already currently operating as an assisted living facility but need new management.
Our Company foresees utilizing this revised business model for the next number of years and intends to become more involved in the assisted living industry in the Southwest Florida market. Being located in Florida presents many opportunities for operating assisted living facilities, as well as potential consulting clients that wish to enter the assisted living facility operations field.
Results of Operations
COVID-19
In March 2020, the World Health Organization declared the outbreak of COVID-19 as a pandemic based on the rapid increase in global exposure. COVID-19 continues to spread throughout the world. The Company is closely monitoring developments and is taking steps to mitigate the potential risks related to the COVID-19 pandemic to the Company, its employees, as well as its residential and consulting clients.
While COVID-19 has not, to date, negatively impacted our revenues, the virus outbreak has materially impacted the operations at our Punta Gorda ALF, and may in the future impact our ALF and consulting businesses and revenues generated therefrom.
Our Punta Gorda ALF, has, in response to COVID-19 and governmental guidance in response thereto, implemented safety precautions, and operational requirements, to protect the facility’s employees, residents and third-party products and service providers. Included among these precautions and requirements are the increased use of personal protective equipment, cleaning and sanitizing of the facility, and a restriction on visitors to the facility.
Going forward any additional safety and operational guidance and/or regulations may have a material impact on the operating costs related to our ALF. Such increased operating costs may or may not be offset by increased charges related thereto. Furthermore, the contraction of COVID-19 by any employees or residents of our ALF, and any resulting negative health consequences arising therefrom, may have a materially negative affect on our ability to continue generating revenues from our ALF and could, in extreme cases result in us closing down our ALF due to safety and/or liability concerns.
Our evaluations of our practices, procedures and operations, related to COVID-19, is ongoing and additional updates to policies, procedures and operations will occur as best practices are adopted and as we deem necessary or advisable, or as further governmental guidance or regulations are implemented.
The ongoing presence of COVID-19 and/or governmental regulatory response thereto may discourage potential clients from entering the ALF market, which would likely have a materially negative impact on our consulting business. However, the continued presence of COVID-19 and/or governmental regulatory response thereto may increase demand for our expertise and consulting services to assist ALF businesses in complying with regulatory requirements and best practices.
The following summary of our operations should be read in conjunction with our unaudited interim financial statements for the three months ended February 29, 2020 and February 28, 2019,2021, which are included in this report. On March 1, 2019, we commenced our operation of an assisted living facility (“ALF”) in Florida. Historical results will not reflect our current operations and will not be comparable
| 4 |
| Table of Contents |
For the Three Months Ended February 28, 2021 Compared to results of operations being reporting in the current period.
Three Months Ended | ||||||||||||
February 29, | ||||||||||||
2019 | 2018 | Change | ||||||||||
Revenue | $ | 212,896 | $ | 4,500 | $ | 208,396 | ||||||
Cost of service | 113,502 | — | 113,502 | |||||||||
Operating expenses | 104,538 | 13,967 | 90,571 | |||||||||
Other expense | 13 | — | 13 | |||||||||
Net loss | $ | 5,131 | $ | 9,467 | $ | (4,336 | ) | |||||
|
| Three Months Ended |
|
|
| |||||||
|
| February 28, |
|
| February 29, |
|
|
|
| |||
|
| 2021 |
|
| 2020 |
|
| Change |
| |||
Revenue |
| $ | 212,105 |
|
| $ | 212,896 |
|
| $ | (791 | ) |
Operating expenses |
|
| 782,534 |
|
|
| 218,040 |
|
|
| 564,494 |
|
Other income (expense) |
|
| 18,969 |
|
|
| 13 |
|
|
| 18,956 |
|
Net loss |
| $ | (551,460 | ) |
| $ | (5,131 | ) |
| $ | (546,329 | ) |
We recognized revenue of $212,105 for the three months ended February 28, 2021, compared to $212,896 for the three months ended February 29, 2020, compared to $4,500 for the three months ended February 28, 2019. The increase in revenue is due to commencing an ALF business in March 2019.
Operating expenses for the three months ended February 29, 20202021 increased $90,571to $782,534 from $13,967$218,040 for the three months ended February 29, 2020. Operating expenses consist of direct costs, salary expenses, general and administrative and professional fees. The increase in operation expenses was primarily due to increase in professional fees (legal and accounting) of $465,162 related to due diligence for acquisitions. There were additional increases in direct cost and supply costs of $33,568, reduction in general and administration of $21,052, and increased salary expenses of $86,816 related to executive compensation.
Other income (expenses) for the three months ended February 28, 2019. Our increase in operating expenses were primarily due2021, consists of loan forgiveness of $20,590 pursuant to increased general and administrativePaycheck Protection Program established under the Cares Act (the “PPP Loan”) offset by interest expenses related to the new ALF operations.line of credit of $1,621.
Our net loss for the three months ended February 29, 2020 decreased $4,33628, 2021 increased to $551,460 from $9,467$5,131 for the three months ended February 28, 2019.
Liquidity and Capital Resources
The following table provides selected financial data about our Companyus as of February 29, 2020,28, 2021 and November 30, 2019, respectively.
Working Capital
February 29, | November 30, | |||||||||||
2020 | 2019 | Change | ||||||||||
Cash | $ | 4,737 | $ | 8,164 | $ | (3,427 | ) | |||||
Current Assets | $ | 4,737 | $ | 9,854 | $ | (5,117 | ) | |||||
Current Liabilities | 54,851 | 54,837 | 14 | |||||||||
Working Capital (Deficiency) | $ | (50,114 | ) | $ | (44,983 | ) | $ | (5,131 | ) | |||
|
| February 28, |
|
| November 30, |
|
|
|
| |||
|
| 2021 |
|
| 2020 |
|
| Change |
| |||
Cash |
| $ | 2,200,752 |
|
| $ | 242,768 |
|
| $ | 1,957,984 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Assets |
| $ | 2,207,187 |
|
| $ | 245,268 |
|
| $ | 1,961,919 |
|
Current Liabilities |
|
| 417,787 |
|
|
| 184,167 |
|
|
| 233,620 |
|
Working Capital |
| $ | 1,789,400 |
|
| $ | 61,101 |
|
| $ | 1,728,299 |
|
As atof February 29, 2020,28, 2021, our working capital increased to $1,789,400, primarily due to an increase in cash offset by an increase in current liabilities.
As of February 28, 2021 and November 30, 2019, our Company’s current assets were $4,737 and $9,854 respectively.
As at February 29, 2020, current assets consisted solely of cash.cash, accounts receivable and other current assets. The decreaseincrease in current asset iscash was primarily due to a decrease in cash and prepaid expense.the issuance of 4,540,000 shares for proceeds of $2,270,000.
As atof February 29, 2020, our Company had28, 2021, current and total liabilities of $54,851, compared with current and total liabilities of $54,837 as at November 30, 2019. As at February 29, 2020, liabilities consisted of $36,156$387,218 accounts payable $12,339and accrued liabilities, $3,955 line of credit, $7,783 lease liability, $10,400 deferred revenue $800 and $5,556customer deposit and $8,431 payable to an officera related party. As of our Company. As at November 30, 2019,2020, current liabilities consisted of $42,581$127,255 accounts payable and accrued liabilities, $20,590 loan payable, $4,924 line of credit, $5,500 deferred revenue and customer deposits, $6,700$17,542 lease liability and $5,556$8,356 payable to an officer of our Company.a related party.
As of February 29, 2020, our working capital deficiency increased $5,131, primarily due to a decrease in current assets.
| 5 |
| Table of Contents |
Cash Flows
Three Months Ended | ||||||||||||
February 29, | February 28, | |||||||||||
2020 | 2019 | Change | ||||||||||
Cash used in operating activities | $ | 15,766 | $ | (6,941 | ) | $ | (8,825 | ) | ||||
Cash provided by (used in) investing activities | — | — | — | |||||||||
Cash provided by financing activities | 12,339 | $ | 22,000 | (9,661 | ) | |||||||
Net change in cash for period | $ | (3,427 | ) | $ | 15,059 | $ | (18,486 | ) | ||||
|
| Three Months Ended |
|
|
|
| ||||||
|
| February 28, |
|
| February 29, |
|
|
|
| |||
|
| 2021 |
|
| 2020 |
|
| Change |
| |||
Cash used in operating activities |
| $ | (311,122 | ) |
| $ | (15,766 | ) |
| $ | (295,356 | ) |
Cash provided by financing activities |
|
| 2,269,106 |
|
|
| 12,339 |
|
|
| 2,256,767 |
|
Net change in cash for period |
| $ | 1,957,984 |
|
| $ | (3,427 | ) |
| $ | 1,961,411 |
|
Cash Flow from Operating Activities
During the three months ended February 29, 2020, our Company28, 2021, we used $15,766$311,122 cash in cash from operating activities, compared to $6,941$15,766 cash used in operating activities during the ninethree months ended February 29, 2020. The cash used in operating activities for the three months ended February 28, 2019.2021, was attributed to net loss of $551,460, which was increased by forgiveness of loan payable of $20,590 and decreased by a net change in current assets and liabilities of $260,928. The cash used fromin operating activities for the three months ended February 29, 2020, was attributed to net loss of $5,131, which was increased by a net change in working capitalcurrent assets and liabilities of $10,635. The cash used
Cash Flow from operating activities forInvesting Activities
During the three months ended February 28, 2019, was attributed to net loss of $9,467, which was reduced by a net change in working capital of $2,526.
Cash Flow from Financing Activities
During the ninethree months ended February 28, 2021, we received $2,270,000 from issuance of 4,540,000 shares of common stock to investors, $75 from related party and a net change of $969 on the line of credit.
During the three months ended February 29, 2020, we received net proceeds of $12,339$13,000 from a bank line of credit. During the three months ended February 28, 2019, we received $22,000 from the issuancecredit and paid principal line of 1,100,000 sharescredit of common stock to investors
Critical Accounting Policies
We prepare our financial statements in conformity with GAAP, which requires management to make certain estimates and apply judgments. We base our estimates and judgments on historical experience, current trends and other factors that management believes to be important at the time the financial statements are prepared. On a regular basis, we review our accounting policies and how they are applied and disclosed in our financial statements.
While we believe that the historical experience, current trends and other factors considered support the preparation of our financial statements in conformity with GAAP, actual results could differ from our estimates and such differences could be material.
Refer to Note 2 - Significant Accounting Policies and the unaudited consolidated financial statements that are included in this Report.
Off Balance Sheet Arrangements
We do not engage in any activities involving variable interest entities or off-balance sheet arrangements.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
As a “smaller reporting company,” we are not required to provide the information required by this Item.
| 6 |
| Table of Contents |
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Our management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) that is designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’sSEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including its principal executive officer or officersofficer(s) and principal financial officer or officers,officer(s), or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
AnIn accordance with Exchange Act Rules 13a-15 and 15d-15, an evaluation was conductedcompleted under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of February 29, 2020.the end of the period covered by this Quarterly Report. Based on that evaluation, our management, including the Chief Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures were not effective as of such date to ensurein providing reasonable assurance that information required to be disclosed in theour reports that we filefiled or submitsubmitted under the Exchange Act iswas recorded, processed, summarized, and reported within the time periods specified in SECthe SEC’s rules and forms. Such officer also confirmed that there was no change in our internal control over financial reporting during the period ended February 29, 2020 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
The specific material weakness identified by our management was ineffective controls over certain aspects of the financial reporting process because of a lack of a sufficient complement of personnel with a level of accounting expertise and an adequate supervisory review structure that is commensurate with our financial reporting requirements and inadequate segregation of duties. A “material weakness” is a deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our Company’s annual or interim financial statements would not be prevented or detected on a timely basis.
We expect to be materially dependent upon a third party to provide us with accounting consulting services for the foreseeable future. Until such time as we have a chief financial officer with the requisite expertise in U.S. GAAP, there are no assurances that the material weaknesses in our disclosure controls and procedures and internal control over financial reporting will not result in errors in our financial statements which could lead to a restatement of those financial statements.
Changes in Internal Controls
There have been no changes in our internal control over financial reporting during the quarter ended February 29, 202028, 2021 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
From time to time, we may become involved in litigation relating to claims arising out of its operations in the normal course of business. We are not involved in any pending legal proceeding or litigation and, to the best of our knowledge, no governmental authority is contemplating any proceeding to which we area party or to which any of our properties is subject, which would reasonably be likely to have a material adverse effect on us.
As a “smaller reporting company,” we are not required to provide the information required by this Item.
During the quarterly period ended February 28, 2021, we sold an aggregate of 4,540,000 shares of our common stock to 24 investors at a price of $0.50 per share for an aggregate purchase price of $2,270,000. The offers, sales and issuances of shares were deemed to be exempt from registration under the Securities Act of 1933, as amended (the “Securities Act”), in reliance on Section 4(a)(2) of the Securities Act and Rule 506(b) of Regulation D promulgated thereunder, as transactions by an issuer not involving a public offering. The recipients of shares in each of these transactions acquired the shares for investment only and not with a view to or for sale in connection with any distribution thereof and represented to us that they could bear the risks of the investment and could hold the securities for an indefinite period of time, and appropriate legends were affixed to the shares issued in these transactions. Each of the recipients of shares in these transactions represented to us in connection with their purchase that they were an accredited investor within the meaning of Rule 501 of Regulation D under the Securities Act.
Item 3. Defaults Upon Senior Securities
None.
Not Applicable.
None.
Exhibit Number | Description | Incorporated By Reference | ||||||
Form | Exhibit | Filing Date | ||||||
S-1 | 3.1 | August 23,2018 | ||||||
S-1 | 3.2 | August 23,2018 | ||||||
(21) | Subsidiaries of the Registrant | |||||||
21.1 | Assisted 2 Live, Inc., a Florida corporation | |||||||
(31) | Rule 13a-14 (d)/15d-14d) Certifications | |||||||
(32) | Section 1350 Certifications | |||||||
101 * | Interactive Data File | |||||||
101.INS | XBRL Instance Document | |||||||
101.SCH | XBRL Taxonomy Extension Schema Document | |||||||
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document | |||||||
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document | |||||||
101.LAB | XBRL Taxonomy Extension Label Linkbase Document | |||||||
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document | |||||||
Item 6. Exhibits
Exhibit Number |
| Description |
| Incorporated By Reference |
| |||
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| Form |
| Exhibit |
| Filing Date |
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| 8-K |
| 2.1 |
| February 2, 2021 | ||
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| S-1 |
| 3.1 |
| August 23, 2018 | ||
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| S-1 |
| 3.2 |
| August 23, 2018 | ||
(21) |
| Subsidiaries of the Registrant |
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21.1 |
| Assisted 2 Live, Inc., a Florida corporation |
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(31) |
| Rule 13a-14 (d)/15d-14d) Certifications |
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(32) |
| Section 1350 Certifications |
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101* |
| Interactive Data File |
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101.INS |
| XBRL Instance Document |
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101.SCH |
| XBRL Taxonomy Extension Schema Document |
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101.CAL |
| XBRL Taxonomy Extension Calculation Linkbase Document |
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101.DEF |
| XBRL Taxonomy Extension Definition Linkbase Document |
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101.LAB |
| XBRL Taxonomy Extension Label Linkbase Document |
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101.PRE |
| XBRL Taxonomy Extension Presentation Linkbase Document |
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______
* Filed herewith
** Furnished herewith
| 9 |
| Table of Contents |
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.
ASSISTED 4 LIVING, INC. | |||
(Registrant) | |||
Dated: April | /s/ | ||
| |||
Chief Executive Officer (principal executive officer) | |||