Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Apr. 16, 2019 | Jun. 29, 2018 | |
Document And Entity Information | |||
Entity Registrant Name | MARIMED INC. | ||
Entity Central Index Key | 0001522767 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2018 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filer | No | ||
Entity Reporting Status Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business Flag | true | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 258,400,000 | ||
Entity Common Stock, Shares Outstanding | 212,425,383 | ||
Trading Symbol | MRMD | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2018 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 4,104,315 | $ 1,290,231 |
Accounts receivable, net | 5,376,966 | 1,453,484 |
Deferred rents receivable | 2,096,384 | 610,789 |
Due from third parties | 3,860,377 | 1,196,918 |
Due from related parties | 15,000 | |
Note receivable, current portion | 51,462 | 45,444 |
Other current assets | 219,012 | 357,019 |
Total current assets | 15,708,516 | 4,968,885 |
Property and equipment, net | 34,099,864 | 25,954,931 |
Intangibles | 185,000 | 333,201 |
Investments | 1,672,163 | |
Note receivable, long-term portion | 1,092,376 | 578,831 |
Debentures receivable | 30,000,000 | |
Due from related parties | 119,781 | 119,781 |
Other assets | 82,924 | 246,386 |
Total assets | 82,960,624 | 32,202,015 |
Current liabilities: | ||
Accounts payable | 3,915,430 | 2,831,658 |
Accrued expenses | 1,588,368 | 1,405,336 |
Deferred rents payable | 105,901 | |
Due to related parties | 276,311 | 400,996 |
Mortgages payable, current portion | 125,178 | 118,556 |
Notes payable | 3,877,701 | 10,665,899 |
Total current liabilities | 9,888,889 | 15,422,445 |
Mortgages payable, long-term portion | 7,411,634 | 5,532,397 |
Debentures payable | 3,557,440 | |
Other liabilities | 338,200 | 240,013 |
Total liabilities | 21,196,163 | 21,194,855 |
Stockholders' equity: | ||
Series A convertible preferred stock, $0.001 par value; 50,000,000 shares authorized at December 31, 2018 and 2017; no shares issued or outstanding at December 31, 2018 and 2017 | ||
Series A preferred stock subscribed but not issued; zero and 500,000 shares at December 31, 2018 and 2017, respectively | 500 | |
Common stock, $0.001 par value; 500,000,000 shares authorized at December 31, 2018 and 2017; 211,013,043 and 176,850,331 shares issued and outstanding at December 31, 2018 and 2017, respectively | 211,013 | 176,850 |
Common stock subscribed but not issued; 97,136 and 1,000,000 shares at December 31, 2018 and 2017, respectively | 169,123 | 370,000 |
Additional paid-in capital | 87,180,165 | 22,256,060 |
Accumulated deficit | (25,575,808) | (11,971,740) |
Noncontrolling interests | (220,032) | 175,490 |
Total stockholders' equity | 61,764,461 | 11,007,160 |
Total liabilities and stockholders' equity | $ 82,960,624 | $ 32,202,015 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Series A convertible preferred stock, par value | $ 0.001 | $ 0.001 |
Series A convertible preferred stock, shares authorized | 50,000,000 | 50,000,000 |
Series A convertible preferred stock, shares issued | ||
Series A convertible preferred stock, shares outstanding | ||
Series A preferred stock, shares subscribed but unissued | 0 | 500,000 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 211,013,043 | 176,850,331 |
Common stock, shares outstanding | 211,013,043 | 176,850,331 |
Common stock, shares subscribed but unissued | 97,136 | 1,000,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Income Statement [Abstract] | ||
Revenues | $ 11,851,915 | $ 6,067,853 |
Cost of revenues | 4,041,122 | 2,192,812 |
Gross profit | 7,810,793 | 3,875,041 |
Operating expenses: | ||
Personnel | 1,339,832 | 737,011 |
Marketing and promotion | 292,477 | 130,087 |
General and administrative | 10,202,731 | 2,880,293 |
Goodwill writedowns | 1,331,785 | |
Total operating expenses | 13,166,825 | 3,747,391 |
Operating income | (5,356,032) | 127,650 |
Non-operating expenses and (income): | ||
Interest expense | 4,366,295 | 592,417 |
Interest income | (593,214) | (80,898) |
Loss on debt settlements, net | 4,133,481 | 872,133 |
Equity in loss of investment | 43,221 | |
Other | 2,858 | (226,940) |
Total non-operating expenses | 7,952,641 | 1,156,712 |
Net income (loss) | (13,308,673) | (1,029,062) |
Net income (loss) attributable to noncontrolling interests | 295,395 | 165,021 |
Net income (loss) attributable to MariMed Inc. | $ (13,604,068) | $ (1,194,083) |
Net income (loss) per share | $ (0.071) | $ (0.010) |
Weighted average common shares outstanding | 192,376,020 | 116,275,301 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) | Series A Convertible Preferred Stock [Member] | Series A Convertible Preferred Stock Subscribed But Not Issued [Member] | Common Stock [Member] | Common Stock Subscribed But Not Issued [Member] | Additional Paid-In Capital [Member] | Accumulated Deficit [Member] | Noncontrolling Interest [Member] | Total |
Balance at Dec. 31, 2016 | $ 300 | $ 64,075 | $ 400 | $ 9,604,435 | $ (10,777,657) | $ 557,006 | $ (551,441) | |
Balance, shares at Dec. 31, 2016 | 300,000 | 64,074,683 | 400,000 | |||||
Subscribed Series A preferred stock | $ 200 | 199,800 | 200,000 | |||||
Subscribed Series A preferred stock, shares | 200,000 | |||||||
Sales of common stock | $ 26,671 | 6,551,329 | 6,578,000 | |||||
Sales of common stock, shares | 26,672,228 | |||||||
Equity issued to settle obligations | $ 1,008 | $ (400) | 327,964 | 328,571 | ||||
Equity issued to settle obligations, shares | 1,007,597 | (400,000) | ||||||
Option grants | 73,902 | 73,902 | ||||||
Exercise of options | $ 4,710 | 2,790 | 7,500 | |||||
Exercise of options, shares | 4,710,000 | |||||||
Warrant issuances | 1,004,351 | 1,004,351 | ||||||
Purchase of subsidiary ownership interests | $ 75,000 | (75,000) | ||||||
Purchase of subsidiary ownership interests, shares | 75,000,000 | |||||||
Sales of subsidiary ownership interests | 1,118,807 | 31,193 | 1,150,000 | |||||
Betty's Eddies™ Asset Purchase | $ 370,000 | 370,000 | ||||||
Betty's Eddies™ Asset Purchase, shares | 1,000,000 | |||||||
Conversion of promissory notes | $ 4,386 | 2,758,683 | 2,763,069 | |||||
Conversion of promissory notes, shares | 4,385,823 | |||||||
Settlement of promissory notes | $ 1,000 | 689,000 | 690,000 | |||||
Settlement of promissory notes, shares | 1,000,000 | |||||||
Distributions | (577,730) | (577,730) | ||||||
Net income (loss) | (1,194,083) | 165,021 | (1,029,062) | |||||
Balance at Dec. 31, 2017 | $ 500 | $ 176,850 | $ 370,000 | 2,256,060 | (11,971,740) | 175,490 | 11,007,160 | |
Balance, shares at Dec. 31, 2017 | 500,000 | 176,850,331 | 1,000,000 | |||||
Sales of common stock | $ 19,189 | 31,801,812 | 31,821,001 | |||||
Sales of common stock, shares | 19,188,980 | |||||||
Equity issued to settle obligations | $ 74,160 | 74,160 | ||||||
Equity issued to settle obligations, shares | 18,000 | |||||||
Compensation expense on option and warrant issuances | 5,760,617 | 5,760,617 | ||||||
Exercise of options | $ 655 | 38,435 | 39,000 | |||||
Exercise of options, shares | 654,602 | |||||||
Conversion of promissory notes | $ 1,568 | 1,092,748 | 1,904,316 | |||||
Conversion of promissory notes, shares | 1,568,375 | |||||||
Distributions | (690,917) | (690,917) | ||||||
Conversion of Series A preferred stock | $ (500) | $ 971 | 33,573 | 34,044 | ||||
Conversion of Series A preferred stock, shares | (500,000) | 970,988 | ||||||
Common stock issued for acquisitions | $ 643 | 1,194,918 | 1,195,561 | |||||
Common stock issued for acquisitions, shares | 642,575 | |||||||
Issuance of subscribed shares | $ 1,000 | $ (370,000) | 369,000 | |||||
Issuance of subscribed shares, shares | 1,000,000 | (1,000,000) | ||||||
Equity issued for services | $ 3,421 | 3,671,697 | 3,675,118 | |||||
Equity issued for services, shares | 3,420,526 | |||||||
Equity conversion | $ 222 | (222) | ||||||
Equity conversion, shares | 222,222 | |||||||
Exercise of warrants | $ 2,143 | 383,252 | 385,395 | |||||
Exercise of warrants, shares | 2,142,710 | |||||||
Discount on debentures payable | 1,057,833 | 1,057,833 | ||||||
Discount on promissory notes | 1,709,595 | 1,709,595 | ||||||
Beneficial conversion feature on debentures payable | 5,569,908 | 5,569,908 | ||||||
Conversions of debentures payable | $ 524 | 1,434,982 | 1,435,506 | |||||
Conversions of debentures payable, shares | 524,360 | |||||||
Settlement of promissory notes | $ 3,827 | $ 94,963 | 9,996,048 | 10,094,838 | ||||
Settlement of promissory notes, shares | 3,827,374 | 79,136 | ||||||
Net income (loss) | (13,604,068) | 295,395 | (13,308,673) | |||||
Balance at Dec. 31, 2018 | $ 211,013 | $ 169,123 | $ 87,180,165 | $ (25,575,808) | $ (220,032) | $ 61,764,461 | ||
Balance, shares at Dec. 31, 2018 | 211,013,043 | 97,136 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Cash flows from operating activities: | ||
Net income (loss) attributable to MariMed Inc. | $ (13,604,068) | $ (1,194,083) |
Net income (loss) attributable to noncontrolling interests | 295,395 | 165,021 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Depreciation | 657,854 | 362,691 |
Bad debt expense | 150,000 | |
Amortization of warrants | 1,171,330 | |
Amortization of beneficial conversion feature | 1,522,107 | |
Goodwill writedowns | 1,331,785 | |
Loss on sale of fixed assets | (2,858) | |
Equity compensation | 5,760,617 | 1,078,253 |
Common stock issued for services | 3,675,121 | 320,772 |
Loss on preferred stock conversions | 34,044 | |
Loss on promissory note conversions | 829,316 | 451,115 |
Loss on promissory note extinguishments | 2,505,050 | 390,000 |
Equity in loss of investment | 43,221 | |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | (4,073,482) | (920,877) |
Deferred rents receivable | (1,485,595) | (74,541) |
Due from third parties | (3,387,906) | (640,238) |
Other current assets | 156,547 | (341,016) |
Other assets | 163,462 | (51,044) |
Accounts payable | 963,083 | 2,359,493 |
Accrued expenses | 183,032 | 86,245 |
Deferred rents payable | 105,901 | |
Deferred revenue | (226,950) | |
Other liabilities | 98,187 | |
Net cash provided by (used in) operating activities | (2,907,857) | 1,764,841 |
Cash flows from investing activities: | ||
Purchase of property and equipment | (8,924,311) | (20,975,763) |
Investment in convertible debentures | (30,000,000) | |
Investment in notes receivable | (565,116) | |
Investment in Iconic Ventures | (500,000) | |
Investment in Sprout | (300,000) | |
iRollie acquisition | 13,494 | |
Proceeds from notes receivable | 45,553 | |
Proceeds from sale of equipment | 145,382 | |
Due from related parties | 15,000 | 52,727 |
Net cash used in investing activities | (40,069,998) | (20,923,036) |
Cash flows from financing activities: | ||
Proceeds from subscribed preferred stock | 200,000 | |
Issuance of common stock | 31,821,001 | 6,585,800 |
Issuance of common stock subscriptions | 55,620 | |
Issuance of interest in subsidiary | 1,150,000 | |
Issuance of promissory notes | 3,206,338 | 9,475,000 |
Payments on promissory notes | (700,000) | |
Issuance of debentures | 10,007,094 | |
Proceeds from mortgages | 2,000,000 | 2,785,841 |
Payments on mortgages | (114,141) | |
Exercise of stock options | 39,000 | 7,500 |
Exercise of warrants | 385,395 | |
Due to related parties | (217,451) | 252,659 |
Distributions | (690,917) | (577,730) |
Net cash provided by financing activities | 45,791,939 | 19,879,070 |
Net change to cash and cash equivalents | 2,814,084 | 720,875 |
Cash and cash equivalents at beginning of period | 1,290,231 | 569,356 |
Cash and cash equivalents at end of period | 4,104,315 | 1,290,231 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | 1,286,007 | 586,584 |
Cash paid for taxes | 12,584 | 1,781 |
Non-cash activities: | ||
Equity issued to settle promissory notes | 7,589,788 | 300,000 |
Conversions of promissory notes | 1,075,000 | 2,311,953 |
Discount on promissory notes | 1,709,595 | |
Conversions of debentures payable | 1,435,506 | |
Beneficial conversion feature on debentures payable | 5,569,908 | |
Discount on debentures payable | 1,057,833 | |
Investment in Sprout | 915,006 | |
iRollie acquisition | 266,682 | |
Issuance of common stock associated with subscriptions | 370,000 | |
Subscriptions issued to acquire assets of Betty’s Eddies™ | 370,000 | |
Issuance of common stock for prepaid rent | $ 18,540 |
Organization and Description of
Organization and Description of Business | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Organization and Description of Business | NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS MariMed Inc. (the “Company”), a Delaware corporation, develops and manages state-of-the-art, regulatory-compliant facilities for the cultivation, production, and dispensing of legal cannabis and cannabis-infused products. Such facilities, located in multiple states, are leased to the Company’s clients in the emerging cannabis industry. Along with operational oversight, the Company provides its clients with legal, accounting, human resources, business development, and other corporate and administrative services. The Company also provides professional consultative services in all aspects of cannabis licensing procurement. To date, the Company has secured, on behalf of its clients, 11 cannabis licenses across five states—two in Delaware, two in Illinois, one in Nevada, three in Maryland and three in Massachusetts. Accordingly, the Company has developed over 300,000 square feet of seed-to-sale cannabis facilities across these five states. In addition, the Company licenses precision-dosed, cannabis-infused products to treat specific medical conditions or to achieve a certain result. These products are licensed under the brand names Kalm Fusion™ and Nature’s Heritage™, both of which were developed by the Company, and Betty’s Eddies™, acquired in October 2017. The Company also has exclusive sublicensing rights in certain states to distribute vaporizer pens developed by Lucid Mood™, as well as the clinically-tested medicinal cannabis strains developed in Israel by Tikun Olam™. The Company’s stock is quoted on the OTCQB market under the ticker symbol MRMD. The Company was originally incorporated in January 2011 under the name Worlds Online Inc., using the ticker symbol WORX. In early 2017, the Company name and ticker were changed to its current name and ticker. At inception, the Company had operated an online portal that offered multi-user virtual environments to users. These operations were effectively ceased in early 2014. The Company has entered into several transactions to develop its business, and more recently to carry out its strategic decision to transition from a professional management and advisory company that provides cannabis licensing, operational consulting, and real estate services, to a direct owner of cannabis licenses and operator of seed-to-sale operations. These transactions are summarized below and disclosed in further detail in Note 3 – Acquisitions In May 2014, the Company, through its subsidiary MariMed Advisors Inc., acquired Sigal Consulting LLC, a company operating in the cannabis industry. This transaction was accounted for as a purchase acquisition where the Company was both the legal and accounting acquirer. In June 2017, the minority interest in MariMed Advisors Inc. was merged into the Company. In May 2018, the Company acquired iRollie LLC, a manufacturer of branded cannabis products and accessories for consumers, and custom product and packaging for companies in the cannabis industry. In July 2018, the Company contracted to acquire AgriMed Industries of PA LLC (“AgriMed”), an entity that holds a license for the cultivation of cannabis into medical marijuana products in the state of Pennsylvania. In February 2019, the Company filed a complaint against this entity for specific performance of their obligations under the purchase agreement. In October 2018, the Company entered into a purchase agreement to acquire its two cannabis-licensed clients, KPG of Anna LLC and KPG of Harrisburg LLC, currently operating medical marijuana dispensaries in the state of Illinois. As of December 31, 2018, the Company had not yet received legislative approval – required for all ownership changes of cannabis licensees – and therefore these entities were not consolidated in the Company’s financial statements as of such date. The Company anticipates approval will be obtained, and the transaction consummated, in 2019 In October 2018, the Company’s cannabis-licensed client with cultivation and dispensary operations in Massachusetts, ARL Healthcare Inc. (“ARL”), filed a plan of entity conversion with the state to convert from a non-profit entity to a for-profit corporation, with the Company as the sole shareholder of the for-profit corporation. On November 30, 2018, the conversion plan was approved by the secretary of state, and effective December 1, 2018, ARL was consolidated into the Company as a wholly-owned subsidiary. In November 2018, the Company issued a letter of intent to acquire The Harvest Foundation LLC, its cannabis-licensed client with cultivation operations in the state of Nevada. The acquisition is conditioned upon legislative approval of the transaction which is expected to occur in May 2019. In December 2018, the Company entered into a memorandum of understanding to merge with Kind Therapeutics USA LLC, its cannabis-licensed client in the state of Maryland. The parties expect the merger agreement to be finalized, and the transaction approved by the state legislature in 2019 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). Certain reclassifications have been made to prior periods’ data to conform to the current period presentation. These reclassifications had no effect on consolidated income (losses) or cash flows. Principles of Consolidation The accompanying condensed consolidated financial statements at December 31, 2018 and 2017 and for the years then ended include the accounts of MariMed Inc. and the following majority-owned subsidiaries. Subsidiary: Percentage Owned MariMed Advisors Inc. 100.0 % Mia Development LLC 89.5 % Mari Holdings IL LLC 60.0 % Mari Holdings MD LLC 97.4 % Mari Holdings NV LLC 100.0 % Hartwell Realty Holdings LLC 100.0 % iRollie LLC 100.0 % ARL Healthcare Inc. 100.0 % Intercompany transactions have been eliminated upon consolidation. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts within the financial statements and disclosures thereof. Actual results could differ from these estimates or assumptions. Cash Equivalents The Company considers all highly liquid investments with a maturity date of three months or less to be cash equivalents. The fair values of these investments approximate their carrying values. The Company’s cash and cash equivalents are maintained with recognized financial institutions located in the United States. In the normal course of business, the Company may carry balances with certain financial institutions that exceed federally insured limits. The Company has not experienced losses on balances in excess of such limits and management believes the Company is not exposed to significant risks in that regard. Accounts Receivable Accounts receivable consist of trade receivables and are carried at their estimated collectible amounts. The Company provides credit to its clients in the form of payment terms. The Company limits its credit risk by performing credit evaluations of its clients and maintaining a reserve, if deemed necessary, for potential credit losses. Such evaluations include the review of a client’s outstanding balances with consideration towards such client’s historical collection experience, as well as prevailing economic and market conditions and other factors. Based on such evaluations, the Company recorded a reserve of $150,000 at December 31, 2018. The accounts receivable balances of two clients constituted 84% of total accounts receivable at December 31, 2018. The balances of these two clients represented 79% of total accounts receivable at December 31, 2017. Investments The Company classifies its investments as available-for-sale-investments. Investments are comprised of equity holding of private companies These investments are recorded at fair value on the Company’s consolidated balance sheet, with changes to fair value, if any, included in comprehensive income. Investments are evaluated for other-than-temporary impairment and are written down if such impairments are deemed to have occurred. Revenue Recognition On January 1, 2018, the Company adopted the Financial Accounting Standards Board’s Accounting Standards Codification (“ASC”) 606, Revenue from Contract with Customers, ● Identify the contract(s) with a customer; ● Identify the performance obligations in the contract(s); ● Determine the transaction price; ● Allocate the transaction price to the performance obligations in the contract(s); and ● Recognize revenue as the performance obligation is satisfied. Additionally, when another party is involved in providing goods or services to the Company’s clients, a determination is made as to who—the Company or the other party—is acting in the capacity as the principal in the sale transaction, and who is merely the agent arranging for goods or services to be provided by the other party. The Company is typically considered the principal if it controls the specified good or service before such good or service is transferred to its client. The Company may also be deemed to be the principal even if it engages another party (an agent) to satisfy some of the performance obligations on its behalf, provided the Company (i) takes on certain responsibilities, obligations and risks, (ii) possesses certain abilities and discretion, or (iii) other relevant indicators of the sale. If deemed an agent, the Company would not recognize revenue for the performance obligations it does not satisfy. The adoption of this standard did not have a significant impact on the Company’s consolidated operating results, and accordingly no restatement has been made to prior period reported amounts. The Company’s main sources of revenue are comprised of the following: ● Real Estate – the Company generates rental income and additional rental fees from leasing its regulatory-compliant legal cannabis facilities to its clients, which are cannabis-licensed operating companies. Rental income is generally a fixed amount per month that escalates over the respective lease terms, while additional rental fees are based on a percentage of tenant revenues that exceed a specified amount. ● Management – the Company receives fees for providing its clients with corporate services and operational oversight of their cannabis cultivation, production, and dispensary operations. These fees are based on a percentage of such clients’ revenue, and are recognized after services have been performed. ● Supply Procurement – the Company maintains volume discounts with top national vendors of cultivation and production resources, supplies, and equipment, which the Company acquires and resells to its clients or third parties within the cannabis industry. The Company recognizes this revenue after the acceptance of goods by the purchaser. ● Licensing – the Company’s derives revenue from the sale of precision-dosed, cannabis-infused products, such as Kalm Fusion™ and Betty’s Eddies™, to legal dispensaries throughout the United States. The recognition of this revenue occurs when the products are delivered. ● Consulting – the Company assists third-parties parties in securing cannabis licenses, and provides advisory services in the areas of facility design and development, and cultivation and dispensing best practices. The revenues associated with these services are recognized as the services are performed. Research and Development Costs Research and development costs are charged to operations as incurred. Property and Equipment Property and equipment are stated at cost less accumulated depreciation, with depreciation recognized on a straight-line basis over the shorter of the estimated useful life of the asset or the lease term, if applicable. When assets are retired or disposed, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are included in income. Repairs and maintenance are charged to expense in the period incurred. The estimated useful lives of property and equipment are generally as follows: buildings and building improvements, seven to thirty-nine years; tenant improvements, the remaining duration of the related lease; furniture and fixtures, seven years; machinery and equipment, five to ten years. Land is not depreciated. The Company’s property and equipment are individually reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment exists when the carrying amount of an asset exceeds the aggregate projected future cash flows over the anticipated holding period on an undiscounted basis. An impairment loss is measured based on the excess of the asset’s carrying amount over its estimated fair value. Impairment analyses are based on management’s current plans, intended holding periods and available market information at the time the analyses are prepared. If these criteria change, the Company’s evaluation of impairment losses may be different and could have a material impact to the consolidated financial statements. For the years ended December 31, 2018 and 2017, based on its impairment analyses, the Company did not have any impairment losses. Impairment of Long-Lived Assets The Company evaluates the recoverability of its fixed assets and other assets in accordance with ASC 360-10-15, Impairment or Disposal of Long-Lived Assets Fair Value of Financial Instruments The Company follows the provisions of ASC 820, Fair Value Measurement Financial Instruments, Level 1 Quoted market prices available in active markets for identical assets or liabilities as of the reporting date. Level 2 Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 3 Pricing inputs that are generally observable inputs and not corroborated by market data. The carrying amounts of the Company’s financial assets and liabilities, such as cash and accounts payable approximate their fair values due to the short maturity of these instruments. The fair value of option and warrant issuances are determined using the Black-Scholes pricing model and employing several inputs such as the expected life of instrument, the exercise price, the expected risk-free interest rate, the expected dividend yield, the value of the Company’s common stock on issuance date, and the expected volatility of such common stock. The following table summarizes the range of inputs used by the Company during the prior two fiscal years: 2018 2017 Life of instrument 0.5 to 5.0 years 3.0 to 5.0 years Volatility factors 1.019 to 2.086 0.963 to 1.095 Risk-free interest rates 1.65% to 3.07% 1.79% to 2.08% Dividend yield 0% 0% The expected life of an instrument is calculated using the simplified method pursuant to Staff Accounting Bulletin Topic 14, Share-Based Payment The Company amortizes the fair value of option and warrant issuances on a straight-line basis over the requisite service period of each instrument. Extinguishment of Liabilities The Company accounts for extinguishment of liabilities in accordance with ASC 405-20, Extinguishments of Liabilities. Stock-Based Compensation The Company accounts for stock-based compensation using the fair value method as set forth in ASC 718, Compensation—Stock Compensation, Income Taxes The Company accounts for income taxes in accordance with ASC 740, Income Taxes ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. The Company did not take any uncertain tax positions and had no adjustments to unrecognized income tax liabilities or benefits for the years ended December 31, 2018 and 2017. Related Party Transactions The Company follows ASC 850, Related Party Disclosures In accordance with ASC 850, the Company’s financial statements include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business, as well as transactions that are eliminated in the preparation of financial statements. Comprehensive Income The Company reports comprehensive income and its components following guidance set forth by ASC 220, Comprehensive Income Earnings Per Share Earnings per common share is computed pursuant to ASC 260, Earnings Per Share As of December 31, 2018 and 2017, there were 18,916,211 and 9,045,311, respectively, of potentially dilutive securities in the form of options and warrants. Also as of such dates, there were (i) zero and 500,000 shares, respectively, of subscriptions on convertible preferred stock, (ii) $3,350,000 and $1,350,000, respectively, of convertible promissory notes, and (iii) approximately $8.6 million and zero, respectively, of convertible debentures payable, that were potentially dilutive, and whose conversion into common stock is based on a discount to the market value of common stock on or about the future conversion date. For the years ended December 31, 2018 and 2017, all potentially dilutive securities had an anti-dilutive effect on earnings per share, and in accordance with ASC 260, were excluded from the diluted net income per share calculation, resulting in identical calculations of basic and fully diluted net income per share. These securities may dilute earnings per share in the future. Commitments and Contingencies The Company follows ASC 450, Contingencies If the assessment of a contingency indicates that it is probable that a material loss will be incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. While not assured, management does not believe, based upon information available at this time, that a loss contingency will have material adverse effect on the Company’s financial position, results of operations, or cash flows. Beneficial Conversion Features on Convertible Debt Convertible instruments that are not bifurcated as a derivative pursuant to ASC 815, Derivatives and Hedging A beneficial conversion feature is a nondetachable conversion feature that is “in-the-money” at the commitment date. The in-the-money portion, also known as the intrinsic value of the option, is recorded in equity, with an offsetting discount to the carrying amount of convertible debt to which it is attached. The discount is amortized to interest expense over the life of the debt with adjustments to amortization upon full or partial conversions of the debt. Risk and Uncertainties The Company is subject to risks common to companies operating within the legal and medical marijuana industries, including, but not limited to, federal laws, government regulations and jurisdictional laws. Noncontrolling Interests Noncontrolling interests represent third-party minority ownership of the Company’s consolidated subsidiaries. Net income attributable to noncontrolling interests is shown in the consolidated statements of operations; the value of net assets owned by noncontrolling interests are presented as a component of equity within the balance sheets. Off-Balance Sheet Arrangements The Company does not have any off-balance sheet arrangements. Recent Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02, Leases (Topic 842) In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350) In June 2018, the FASB issued ASU 2018-07, Compensation - Stock Compensation (Topic 718): Improvement to Nonemployee Share-Based Payment Accounting, In addition to the above, the Company has reviewed all other recently issued, but not yet effective, accounting pronouncements, and does not believe the future adoption of any such pronouncements will have a material impact on its financial condition or the results of its operations. |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2018 | |
Business Combinations [Abstract] | |
Acquisitions | NOTE 3 – ACQUISITIONS Sigal Consulting LLC In May 2014, the Company, through its subsidiary MariMed Advisors Inc., acquired Sigal Consulting LLC from its ownership group which included the current CEO and CFO of the Company (the “Sigal Ownership Group”). The purchase price received by the Sigal Ownership Group was comprised of (i) 31,954,236 shares of common stock valued at approximately $5.9 million, representing 50% of the Company’s outstanding shares on the closing date, (ii) options to purchase three million shares of the Company’s common stock, exercisable over five years with exercise prices ranging from $0.15 to $0.35, and valued at approximately $570,000, and (iii) a 49% ownership interest in MariMed Advisors Inc. The excess of purchase price over the book value of the acquired entity was recorded as goodwill, which was subsequently impaired in full and written down to zero. In June 2017, the remaining 49% interest of MariMed Advisors Inc. was merged into the Company in exchange for an aggregate 75 million shares of common stock to the Sigal Ownership Group. Betty’s Eddies™ In October 2017, the Company acquired the intellectual property, formulations, recipes, proprietary equipment, know-how, and other certain assets of Betty’s Eddies™, a brand of cannabis-infused fruit chews, from Icky Enterprises LLC, a company partially owned by an officer of the Company (“Icky”). The purchase price was $140,000 plus 1,000,000 shares of the Company’s common stock valued at $370,000 based on the price of the common stock on the issuance date. These shares of common stock were issued in June 2018, and accordingly, the shares were classified as Common Stock Subscribed But Not Issued The acquisition was accounted for in accordance with ASC 10, Business Combinations Inventory $ 46,544 Machinery and equipment 130,255 Goodwill 333,201 Total fair value of consideration $ 510,000 The goodwill balance of approximately $333,000 was written down in 2018. As part of the agreement between the parties, Icky shall receive royalties based on a percentage of the Company’s sales of the Betty’s Eddies™ product line, commencing at 25% and decreasing to 2.5% as certain sales thresholds are met. For the years ended December 31, 2018 and 2017, such royalties approximated $16,000 and $10,000, respectively. iRollie LLC Effective April 2018, the Company entered into a purchase agreement whereby 264,317 shares of the Company’s common stock were exchanged for 100% of the ownership interests of iRollie LLC, a manufacturer of branded cannabis products and accessories for consumers, and custom product and packaging for companies in the cannabis industry. The Company acquired, among other assets, iRollie’s entire product line, service offerings, clients, and intellectual property, and hired its two co-founders. The acquisition was accounted for in accordance with ASC 10. The shares of Company common stock valued at $280,176 were issued to iRollie’s former owners in December 2018, at which time the Company adjusted the total goodwill generated on the transaction. The following table summarizes the allocation of the purchase price to the fair value of the assets acquired: Cash and cash equivalents $ 13,494 Goodwill 266,682 Total fair value of consideration $ 280,176 Prior to the acquisition, iRollie had not been generating positive cash flow as a stand-alone entity, and in conformity with relevant accounting guidance, the goodwill was written down. ARL Healthcare Inc. In October 2018, the Company’s cannabis-licensed client in Massachusetts, ARL Healthcare Inc. (“ARL”), filed a plan of entity conversion with the state to convert from a non-profit entity to a for-profit corporation, with the Company as the sole shareholder of the for-profit corporation. ARL holds three cannabis licenses from the state of Massachusetts for the cultivation, production and dispensing of cannabis. On November 30, 2018, the conversion plan was approved by the secretary of state, and effective December 1, 2018, ARL was consolidated into the Company as a wholly-owned subsidiary. Additionally, the Company’s chief operating officer was appointed as ARL’s sole board member. The acquisition was accounted for in accordance with ASC 10, Business Combinations Equipment $ 21,000 Cannabis licenses 180,000 Accounts payable (120,689 ) Due to related parties (92,765 ) Total identifiable net assets (7,454 ) Goodwill 731,902 Total fair value of consideration $ 724,448 The total consideration paid by the Company was equal to the forgiveness of amounts owed by the Company to ARL. Accordingly, the transaction gave rise to goodwill of approximately $732,000, which the Company wrote down. AgriMed Industries of PA LLC In July 2018, the Company entered into a purchase agreement to acquire 100% of the ownership interests of AgriMed Industries of PA LLC, an entity that holds a license from the state of Pennsylvania for the cultivation of cannabis (“AgriMed”). AgriMed presently develops cannabis products that are wholesaled to medical marijuana dispensaries within the state. The purchase price is comprised of $8,000,000, a portion of which may be in the form of the Company’s common stock at the seller’s option, and the assumption of certain liabilities of AgriMed not to exceed $700,000. In February 2019, the Company filed a complaint against AgriMed for specific performance of their obligations under the purchase agreement. The consummation of this transaction is contingent upon the resolution of this complaint. KPG of Anna LLC and KPG of Harrisburg LLC In October 2018, the Company entered into a purchase agreement to acquire 100% of the ownership interests of KPG of Anna LLC and KPG of Harrisburg LLC, the Company’s two cannabis-licensed clients that operate medical marijuana dispensaries in the state of Illinois (both entities collectively, the “KPGs”), from the current ownership group of the KPGs (the “Sellers”). As part of this transaction, the Company will also acquire the Sellers’ ownership interests of Mari Holdings IL LLC, the Company’s subsidiary which owns the real estate in which the KPGs’ dispensaries are located (“Mari-IL”). The purchase price of 1,000,000 shares of the Company’s common stock shall be issued to the Sellers upon the closing of the transaction, which is dependent upon, among other closing conditions, the approval by the Illinois Department of Financial and Professional Regulation. Such approval is expected to be received by mid-2019. After the transaction is effectuated, the KPGs and Mari-IL will be wholly-owned subsidiaries of the Company. As of December 31, 2018, the Company had not yet received the legislative approval – required for all ownership changes of cannabis licensees – and therefore the operations of the KPGs were not consolidated in the Company’s financial statements as of such date. The Company anticipates approval will be obtained, and the transaction consummated, in 2019. When that occurs, the Company expects to consolidate the acquired entities in accordance with ASC 10. The Harvest Foundation LLC In November 2018, the Company issued a letter of intent to acquire 100% of the ownership interests of The Harvest Foundation LLC, the Company’s cannabis-licensed client in the state of Nevada. The parties are in the process of negotiating a definitive agreement governing the acquisition following the satisfactory completion of due diligence. The acquisition is conditioned upon the appropriate legislative approval of the transaction, which is expected to occur in May 2019. Accordingly, the operations of The Harvest Foundation LLC have not been consolidated for the year ended December 31, 2018. Kind Therapeutics LLC In December 2018, the Company entered into a memorandum of understanding to merge with its cannabis-licensed client in Maryland, Kind Therapeutics LLC. A merger agreement is currently being drafted for this transaction, which is intended to qualify as a tax-deferred reorganization under the Internal Revenue Code. The parties expect the merger agreement to be finalized, and the transaction approved by the state legislature in 2019. |
Investments
Investments | 12 Months Ended |
Dec. 31, 2018 | |
Schedule of Investments [Abstract] | |
Investments | NOTE 4 – INVESTMENTS Sprout During 2018, the Company invested $300,000, of a total contracted cash investment of $500,000, and issued 378,259 shares of common stock, valued at approximately $915,000, in exchange for 23% ownership in CVP Worldwide LLC (“CVP”). CVP has developed a customer relationship management and marketing platform, branded under the name Sprout, which is specifically designed for companies in the cannabis industry. The Company shall assist in the ongoing development and design of Sprout, and in marketing Sprout to companies within the cannabis industry. The Company shall earn a percentage share of Sprout’s revenues generated from sales (i) to the Company’s clients, and (ii) by the Company to third parties. As of December 31, 2018, no revenue share was earned by the Company. The investment has been accounted under the equity method. For the year ended December 31, 2018 , the Company recorded a charge to net income of approximately $43,000 based on its equity in CVP’s net loss during the period of the Company’s ownership. Such amount reduced the carrying value of the investment to approximately $1,172,000 at December 31, 2018. Vitiprints In August 2018, the Company entered into a licensing agreement for the exclusive worldwide license to use, develop, sublicense, promote, sell or otherwise commercialize in any way a patented technology to produce and distribute cannabis products with exceedingly precise dosing at increased production economies (“the Vitiprints License”). The licensing agreement has an initial term of five years, with an option to renew the agreement for successive five-year periods, provided that notice of renewal is delivered prior to the expiration of the initial term or a renewal term. Pursuant to the agreement, the Company made a non-refundable payment of $250,000. This payment was expensed and is included in Cost of Revenues DabTabs™ In December 2018, the Company purchased 2,500,000 shares of common stock of Iconic Ventures Inc. (“Iconic”) for an aggregate price of $500,000. Iconic, a private company, has developed DabTabs™, a unique solution for cannabinoid vaporization via a convenient portable tablet that provides precisely measured dosing and acts as a storage system for full spectrum extracts, concentrates and distillates. The Company’s investment equates to an ownership percentage in Iconic of less than 15%. The Company was not given a board seat and does not have ability to exert operational or financial control over the entity. In accordance with ASC 321, Investments – Equity Securities The Company will continue to apply the alternative measurement guidance until this investment does not qualify to be so measured. The Company may subsequently elect to measure this investment at fair value, and if so, shall measure all identical or similar investments in Iconic at fair value. Any subsequent changes in fair value shall be recognized in net income. |
Deferred Rents Receivable
Deferred Rents Receivable | 12 Months Ended |
Dec. 31, 2018 | |
Revenue Recognition and Deferred Revenue [Abstract] | |
Deferred Rents Receivable | NOTE 5 – DEFERRED RENTS RECEIVABLE The Company leases its regulatory-compliant legal cannabis facilities to its cannabis-licensed clients generally under 20-year non-cancelable lease agreements which contain rent holidays, escalating rents over time, options to renew, and the requirement to pay property taxes, insurance and/or maintenance costs. These leases also contain contingent rental payments that are based on a percentage of monthly tenant revenues. The Company recognizes fixed rental receipts from such lease agreements on a straight-line basis over the expected lease term. Differences between amounts received and amounts recognized are recorded under Deferred Rents Receivable The Company leases the following owned properties: ● Delaware – a 45,000 square foot facility purchased in September 2016 and built into a cannabis cultivation, processing, and dispensary facility which is leased to a cannabis-licensed client occupying 100% of the space under a 20-year triple net lease expiring in 2035. ● Illinois – two 3,400 square foot free-standing retail dispensaries in the cities of Anna and Harrisburg and leased to two licensed cannabis dispensary clients each under a 20-year lease expiring in 2036. ● Maryland – a 180,000 square foot former manufacturing facility purchased January 2017 and rehabilitated by the Company into a cultivation and processing facility which is leased to a licensed cannabis client under a 20-year triple net lease that started in January 2018. The Company subleases the following properties: ● Delaware – 4,000 square feet of retail space in a multi-use building space which the Company developed into a cannabis dispensary which is subleased to its cannabis-licensed client under a under a five-year triple net lease with a five-year option to extend. ● Nevada – 10,000 square feet of an industrial building that the Company built-out into a cannabis cultivation facility and is subleased to the Company’s cannabis-licensed client under a sublease for 10 years expiring in 2024. As of December 31, 2018 and 2017, cumulative fixed rental receipts under such leases approximated $5.4 million and $2.8 million, respectively, compared to revenue recognized on a straight-line basis of approximately $7.5 million and $3.4 million. Accordingly, the deferred rents receivable balances at December 31, 2018 and 2017 approximated $2.1 million and $611,000, respectively. Future minimum rental receipts for non-cancelable leases and subleases as of December 31, 2018 were: 2019 $ 1,261,181 2020 1,287,257 2021 1,315,686 2022 1,193,990 2023 1,179,641 Thereafter 14,571,268 Total $ 20,809,023 |
Due from Third Parties
Due from Third Parties | 12 Months Ended |
Dec. 31, 2018 | |
Notes to Financial Statements | |
Due from Third Parties | NOTE 6 – DUE FROM THIRD PARTIES At December 31, 2018 and 2017, the balances due from third parties were comprised the following amounts advanced to the Company’s cannabis-licensed clients for working capital purposes: 2018 2017 Kind Therapeutics USA Inc. (Maryland licensee) $ 2,679,496 $ 77,558 KPG of Anna LLC (Illinois licensee) 482,700 418,305 KPG of Harrisburg LLC (Illinois licensee) 449,385 382,260 Harvest Foundation LLC (Nevada licensee) 248,796 40,693 ARL Healthcare Inc. (Massachusetts licensee) - 176,823 Other - 101,279 Total due from third parties $ 3,860,377 $ 1,196,918 Such amounts are advanced by the Company to its clients in order to furnish these companies with additional means by which they can establish their cannabis businesses and grow their operations. The Company has employed this strategy in the past, and is continuing with these companies, whereby all advanced amounts are reimbursed as the companies begin to generate positive cash flow. |
Debentures Receivable
Debentures Receivable | 12 Months Ended |
Dec. 31, 2018 | |
Debentures Receivable | |
Debentures Receivable | NOTE 7 – DEBENTURES RECEIVABLE During 2018, in a series of transactions, the Company purchased $30 million of subordinated secured convertible debentures (the “GC Debentures”) of GenCanna Global, Inc., a producer and distributor of agricultural hemp, cannabidiol (CBD) formulations, hemp genetics, and hemp products (“GenCanna”). The GC Debentures bear interest at a compounded rate of 9% per annum and mature three years from issuance. The GC Debentures are convertible into the common stock of GenCanna, at the Company’s option, (i) upon the occurrence of a Liquidity Event, as defined in the GC Debentures, or (ii) after December 31, 2018, upon ten days prior written notice to GenCanna. Conversion of the Company’s entire $30 million investment shall equate to at least a 33.3% ownership interest in GenCanna on a fully diluted basis. The conversion price is equal to the lesser of a 20% discount to the price of the Liquidity Event, or the price based on a defined post-money valuation of GenCanna. If a Liquidity Event does not occur on or before June 30, 2020, the Company shall have the option to be redeemed in cash for the principal amount of the GC Debenture plus all accrued and unpaid interest thereon. Among other provisions of the subscription agreement governing this series of transactions, the Company was given the right to appoint a director to GenCanna’s board, and agree to fund a $10 million employee bonus pool should GenCanna meet certain 2019 operating targets. Concurrent with the completion of the GC Debenture purchases, the parties executed a security and pledge agreement whereby the Company was granted a senior security interest on certain assets of GenCanna equal in value to 100% or more of the principal and accrued interest on the GC Debentures until such time the GC Debentures are paid down, redeemed or converted. Additionally, the Company was granted certain other rights, pursuant to a rights agreement, including rights of inspection, financial information, and participation in future security offerings of GenCanna. For the year ended December 31, 2018, the Company earned and received interest income of approximately $502,000 on the GC Debentures. In February 2019, the Company converted the GC Debentures plus accrued interest through the conversion date into a 33.5% ownership interest in GenCanna on a fully diluted basis, as disclosed in Note 20 – Subsequent Events |
Notes Receivable
Notes Receivable | 12 Months Ended |
Dec. 31, 2018 | |
Receivables [Abstract] | |
Notes Receivable | NOTE 8 – NOTES RECEIVABLE At December 31, 2018 and 2017, notes receivable were comprised of the following: 2018 2017 First State Compassion Center -12.5% per annum, maturing in 2026 $ 578,723 $ 624,275 The Healer - 8% per annum, maturing in 2021 307,429 - Chooze Corp. - 8% per annum, maturing in 2021 257,687 - Total notes receivable 1,143,839 624,167 Current portion of First State Compassion Center note receivable 51,462 45,444 Notes receivable, long-term portion $ 1,092,377 $ 578,831 The Company loaned approximately $700,000 to First State Compassion Center, its Delaware cannabis-licensee client, during the period of October 2015 to April 2016. In May 2016, this client issued a 10-year promissory note, as amended, to the Company bearing interest at a compounded rate of 12.5% per annum. The monthly payments of approximately $10,100 will continue through April 2026, at which time the note will be fully paid down. At December 31, 2018 and 2017, the current portion of this note comprised the Note Receivable, Current Portion Notes Receivable, Less Current Portion During 2018, the Company loaned an aggregate of $550,000 to Chooze Corp. and The Healer, two unrelated third-party companies in the cannabis industry. The loans bear interest at 8% per annum and mature in 2021. At December 31, 2018, the aggregate loan balances plus accrued interest approximated $565,000. In January 2019, the note receivable from Chooze Corp. was converted into a 2.7% ownership interest in that entity. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | NOTE 9 – PROPERTY AND EQUIPMENT At December 31, 2018 and 2017, property and equipment consisted of the following: 2018 2017 Land $ 3,392,710 $ 3,392,710 Buildings and building improvements 13,566,144 3,918,359 Tenant improvements 5,348,882 2,260,512 Furniture and fixtures 114,160 95,815 Machinery and equipment 1,632,351 506,464 Construction in progress 12,205,447 17,279,949 36,259,694 27,453,809 Less: accumulated depreciation (2,159,830 ) (1,498,878 ) Property and equipment, net $ 34,099,864 $ 25,954,931 During the years ended December 31, 2018 and 2017, additions to property and equipment were approximately $8.9 million and $21.0 million, respectively. The 2017 additions were primarily comprised of (i) the purchase of properties in Hagerstown, MD, and Middleborough, MA, (ii) the purchase of land and property in New Bedford, MA, (iii) the start of construction at these three locations, and (iv) continuing improvements at the Lewes, DE, Anna, IL, and Harrisburg, IL locations. The 2018 additions consisted primarily of the continued buildout of both locations in MA and the location in MD. The 2017 construction in progress balance of approximately $17.3 million consisted of the following: · $11.2 million – Hagerstown, MD building, machinery, improvements, and fixtures; · $5.0 million – New Bedford, MA building and improvements; and · $1.1 million – Middleborough, MA building During 2018, the $11.2 million of Hagerstown, MD construction in progress was placed into service, and the 2018 construction in progress balance of approximately $12.2 million was primarily comprised of: · $9.8 million – New Bedford, MA building, improvements and machinery; and · $2.4 million – Middleborough, MA building, improvements and fixtures. Depreciation expense for the years ended December 31, 2018 and 2017 was approximately $658,000 and $363,000, respectively. |
Debt
Debt | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Debt | NOTE 10 – DEBT Mortgages In November 2017, the Company entered into a 10-year mortgage agreement with Bank of New England for the purchase of a 138,000 square foot industrial property in New Bedford, Massachusetts, within which the Company has built a 70,000 square foot cannabis cultivation and processing facility that is leased to ARL. From the start of the mortgage through May 2019, the Company is required to make monthly payments of interest-only at a rate equal to the monthly prime rate plus 2%, with a floor of 6.25%. From May 2019 to May 2024, the Company shall make principal and interest payments at a rate equal to the prime rate on May 2, 2019 plus 2%, with a floor of 6.25%. Principal and interest payments shall continue from May 2024 through the end of the lease at a rate equal to the prime rate on May 2, 2024 plus 2%, with a floor of 6.25%. At December 2018 and 2017, the principal balance on this mortgage was approximately $4.9 million and $2.9 million, respectively. The Company maintains another mortgage with Bank of New England for the 2016 purchase of a 45,070 square foot building in Wilmington, Delaware which was developed into a cannabis seed-to-sale facility and is currently leased to the Company’s cannabis-licensed client in the state. The mortgage matures in 2031 with monthly principal and interest payments at a rate of 5.25% through September 2021, and thereafter the rate adjusting every five years to the then prime rate plus 1.5% with a floor of 5.25%. At December 31, 2018 and 2017, the principal balance on this mortgage was approximately $1.8 million and $1.9 million, respectively. In 2016, the Company entered into a mortgage agreement with DuQuoin State Bank (“DSB”) for the purchase of two properties that it developed into two 3,400 square foot free-standing retail dispensaries that are currently leased to the KPGs. On May 5 th Promissory Notes In September 2018, the Company raised $3,000,000 from the issuance of a secured promissory note bearing interest at the rate of 10% per annum, with interest payable monthly. The note is due and payable in September 2019, however the Company may elect to prepay the note in whole or part at any time after December 17, 2018 without premium or penalty. The Company issued three-year warrants, which were attached to this promissory note, to the lender’s designees to purchase 750,000 shares of the Company’s common stock at an exercise price of $1.80 per share. The Company recorded a discount on the note of approximately $1.5 million from the allocation of note proceeds to the warrants based on the fair value of such warrants on the issuance date. During 2018, approximately $882,000 of the warrant discount was amortized to interest expense. At December 31, 2018, the carrying value of this note, net of remaining warrant discount of approximately $630,000, was approximately $2.37 million. During the year ended 2017, the Company raised $9,475,000 from the issuance of promissory notes with interest rates ranging from 4.5% to 12%, all with maturity dates of 12 months or less from the date of issue. During 2018, holders of previously issued promissory notes with principal balances of $1,075,000 converted such promissory notes into 1,568,375 shares of common stock at conversion prices ranging from $0.65 to $0.90 per share. The conversions resulted in the recording of non-cash losses of approximately $829,000 in the aggregate, based on the market value of the common stock on the conversion dates. In August 2017, $2.05 million in principal and approximately $262,000 of accrued interest on promissory notes were converted into 4,385,823 shares of common stock at a conversion price of $0.53 per share. Based on the market value of the common stock on the conversion date, the Company recorded a non-cash loss on conversion of approximately $451,000. During 2018, the Company issued 2,596,313 shares of common stock and subscriptions on 79,136 shares of common stock to retire promissory notes with principal balances of $7,495,000 and approximately $95,000 of accrued interest. The Company recorded non-cash losses of approximately $2.5 million based on the fair value of the common stock on the retirement dates. During 2017, the Company issued 5,385,823 share of commons stock to retire promissory notes with principal balances of $2,300,000 and approximately $312,000 of accrued interest. The Company recorded a non-cash loss of approximately $841,000 based on the fair value of the common stock on the retirement dates. During 2018 the Company repaid $700,000 of promissory notes. No repayments debt occurred during the same period in 2017. The aggregate scheduled maturities of the Company’s total debt outstanding, inclusive of the promissory notes and mortgages described within this Note 10 – Debt Debentures Payable 2019 $ 5,154,404 2020 9,070,954 2021 235,827 2022 251,543 2023 268,338 Thereafter 5,544,226 Total 20,525,292 Less discounts (5,553,339 ) $ 14,971,953 |
Debentures Payable
Debentures Payable | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Debentures Payable | NOTE 11 – DEBENTURES PAYABLE In October and November 2018, pursuant to a securities purchase agreement (the “SPA”), the Company sold an aggregate of $10,000,000 convertible debentures bearing interest at the rate of 6% per annum that mature three years from issuance, with a 1% issue discount, resulting in net proceeds to the Company of $9,900,000 (the “$10M Debentures”). The holder of the $10M Debentures (the “Holder”) has the right at any time to convert all or a portion of the $10M Debenture, along with accrued and unpaid interest, into the Company’s common stock at conversion prices equal to 80% of a calculated average, as determined in the $10M Debentures, of the daily volume-weighted price during the ten consecutive trading days preceding the date of conversion. Notwithstanding this conversion right, the Holder shall limit conversions in any given month to certain agreed-upon values based on the conversion price, and the Holder shall also be limited from beneficially owning more than 4.99% of the Company’s outstanding common stock (potentially further limiting the Holder’s conversion right). The Company shall have the right to redeem all or a portion of the $10M Debentures, along with accrued and unpaid interest, at a 10% premium, provided however that the Company first provide advance written notice to the Holder of its intention to make a redemption, with the Holder allowed to affect one or more conversions of the $10M Debentures during such notice period. Upon a change in control transaction, as defined in the $10M Debentures, the Holder may require the Company to redeem all or a portion of the $10M Debentures at a price equal to 110% of the principal amount of the $10M Debentures plus all accrued and unpaid interest thereon. So long as the $10M Debentures are outstanding, in the event the Company enters into a Variable Rate Transaction (“VRT”), as defined in the SPA, the Holder may cause the Company to revise the terms of the $10M Debentures to match the terms of the convertible security of such VRT. As part of issuance of the $10M Debenture, the Company issued three-year warrants to the Holder to purchase 324,675 shares of common stock at exercise prices of $3.50 and $5.50 per share (the “Warrants”). Pursuant to the terms of a registration rights agreement with the Holder, entered into concurrently with the SPA and the $10M Debentures, the Company agreed to provide the Holder with customary registration rights with respect to any potential shares issued pursuant to the terms of the SPA, the $10M Debentures, and the Warrants. Subsequent to the consummation of the SPA and related agreements, the Company and the Holder executed an addendum to the SPA whereby the Holder agreed to that it would not undertake a conversion of all or a portion of the $10M Debentures that would require the Company to issue more shares than the amount of available authorized shares at the time of conversion, which amount of authorized shares shall not be less than the current authorized number of 500 million shares of common stock. Such addendum eliminated the requirement to bifurcate and account for the conversion feature of the $10M Debentures as a derivative. Based on the conversion prices of the $10M Debentures in relation to the market value of the Company’s common stock, the $10M Debentures provided the Holder with a beneficial conversion feature, as the embedded conversion option was in-the-money on the commitment date. The intrinsic value of the beneficial conversion feature of approximately $5.6 million was recorded as a discount to the carrying amount of the $10M Debentures, with an offset to additional paid-in-capital. In addition to the discount related to the beneficial conversion feature, an additional discount of approximately $1.057 million was recorded based on the allocation of proceeds to the fair value of the Warrants attached to the debt. In November and December 2018, the Holder converted $1,400,000 of principal and approximately $36,000 of accrued interest into 524,360 shares of common stock at conversion prices of $2.23 and $3.04 per share. During the year ended December 31, 2018, amortization of the beneficial conversion feature, after adjustment for the partial conversions, approximated $1.5 million; amortization of the Warrants discount approximated $91,000; and the amortization of original issue discount approximated $9,000. This amortization was charged to interest expense. Additionally, accrued interest expense on the notes for such period approximated $98,000 of which approximately $36,000 was paid prior to the end of the year. At December 31, 2018, the unamortized balances of the beneficial conversion feature, Warrants discount, and original issue discount were approximately $4.1 million, $966,000, and $91,000, respectively. Also on such date, the outstanding principal balance on the $10M Debentures was $8.6 million, with accrued and unpaid interest of approximately $62,000. Accordingly, at December 31, 2018, the carrying value of the $10M Debentures was approximately $3.6 million. |
Equity
Equity | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Equity | NOTE 12 – EQUITY Preferred Stock In January 2017, the Company increased the number of authorized shares of preferred stock from 5 million to 50 million shares. During 2017, the Company issued subscriptions on 200,000 shares of Series A convertible preferred stock at $1.00 per share. No subscriptions were issued during 2018. The Series A convertible preferred stock accrues an annual dividend of 6% until conversion. The preferred stock is convertible, along with any accrued dividends, into common stock at a twenty-five percent discount to the selling price of the common stock in a qualified offering, as defined in the subscription agreement. In addition, the Company has the ability to force the conversion of preferred stock at such time the Company has a market capitalization in excess of $50 million for ten consecutive trading days. In such event, the conversion price shall be a 25% discount to the average closing price of the Company’s common stock over the ten trading days prior to the Company’s notice of its intent to convert. In January 2018, all 500,000 shares of subscribed Series A convertible preferred stock were converted into 970,989 shares of common stock at a conversion price of $0.55 per share. The Company recorded a non-cash loss on conversion of approximately $34,000 based on the market value of the common stock on the conversion date. No shares were converted during 2017. Common Stock In January 2017, the Company increased the number of authorized shares of common stock from 100 million to 500 million shares. In June 2017, the Company issued 75 million shares of common stock to acquire the remaining 49% interest in its subsidiary MariMed Advisors Inc. During the year ended December 31, 2018 the Company sold 19,188,981 shares of common stock at prices ranging from $0.50 to $3.00 per share, resulting in total proceeds of $31.8 million. During the year ended December 31, 2017, the Company sold 26,672,228 shares of common stock, at prices ranging from $0.18 to $0.50 per share, resulting in total proceeds of $6,578,000. During the years ended December 31, 2018 and 2017, the Company issued 3,420,526 and 1,007,597 shares, respectively, in exchange for services rendered by third-parties or to otherwise settle outstanding obligations. Based on the market value of the common stock on the dates of issuance, the Company recorded non-cash losses on these settlements of approximately $1,024,000 and $31,000, respectively. As previously disclosed in Note 3 – Acquisitions As previously disclosed in Note 4 – Investments As previously disclosed in Note 10 – Debt As previously disclosed in Note 11 – Debentures Payable As further disclosed in Note 13 – Stock Options As further disclosed in Note 14 – Warrants Common Stock Subscribed But Not Issued At December 31, 2018, there were outstanding subscriptions on 79,136 shares of common stock related to the settlement of a previously issued promissory note with a principal balance of $50,000 and accrued interest of $1,454. These subscriptions had a value of approximately $95,000 based on the market value of the common stock on the settlement date. Also outstanding on such date were subscriptions on 18,000 shares of common stock, equivalent to an aggregate amount of $74,160, for the payment of rent for the months of September 2018 through January 2019 for a leased property in Massachusetts. The shares of common stock associated with all outstanding subscriptions at December 31, 2018 were issued in March 2019. In October 2017, the Company issued subscriptions on 1,000,000 shares of common stock as part of the purchase price of the Betty’s Eddies™ acquired assets as further disclosed in Note 3 – Acquisitions Membership Interests In August 2018, an individual member of Mari Holdings MD LLC, a majority owned subsidiary of the Company (“Mari-MD”), exchanged his 0.5% membership interest in such subsidiary for 222,222 shares of the Company’s common stock. In December 2018, a subscriptions receivable balance of $25,000 related to a member’s interest in a majority-owned subsidiary was written off, with a corresponding reduction of such member’s capital contribution account. During 2017, the Company issued 12,778 Class A membership units of Mari-MD for $1,150,000, representing 3.05% ownership of this subsidiary at December 31, 2017. |
Stock Options
Stock Options | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Stock Options | NOTE 13 – STOCK OPTIONS During 2018, the Company granted options to purchase 4.72 million shares of common stock at exercise prices ranging from $0.14 to $3.73 and expiring between December 2020 and November 2024. Of the total 4.72 million options issued, 3.15 million were vested upon issuance and 1.57 million have vesting periods that span six to thirty months. The fair value of these options, measured on grant date, of approximately $5.9 million is being amortized over the respective vesting periods, of which approximately $3.9 million was amortized during the year ended December 31, 2018. During 2017, the Company granted options to purchase 550,000 shares of common stock at exercise prices ranging from $0.26 to $0.55, vesting from the grant date through March 2019, and expiring between September 2020 and October 2021. The fair value of these options, measured on grant date, was approximately $159,000, of which approximately $74,000 was amortized in 2017, $58,000 was amortized in 2018, and $27,000 was forfeited prior to vesting. During the years ended December 31, 2018 and 2017, options to purchase 760,000 and 4,800,000 shares of common stock, respectively, were exercised at exercise prices ranging from $0.08 to $0.63 per share, and $0.01 to $0.03 per share, respectively. Of these exercised options, during 2018 and 2017, 460,000 and 4,500,000 options, respectively, were cashless exercises, with the exercise price paid via the surrender of 105,398 and 90,000 shares of common stock. The following table summarizes the Company’s stock option transactions during the 2018 and 2017 fiscal years: Number of Stock Options Weighted-Average Exercise Price Outstanding at December 31, 2016 9,250,000 $ 0.100 Granted 550,000 0.458 Exercised (4,800,000 ) 0.011 Forfeited/Expired (200,000 ) 0.025 Outstanding at December 31, 2017 4,800,000 0.234 Granted 4,720,000 1.805 Exercised (760,000 ) 0.216 Forfeited/Expired (450,000 ) 0.433 Outstanding at December 31, 2018 8,310,000 $ 1.117 Stock options outstanding and exercisable as of December 31, 2018 were: Exercise Price Shares Under Option Remaining per Share Outstanding Exercisable Life in Years $ 0.08 250,000 250,000 0.08 $ 0.08 100,000 100,000 0.97 $ 0.13 200,000 200,000 1.50 $ 0.14 650,000 650,000 2.00 $ 0.15 1,000,000 1,000,000 0.74 $ 0.25 1,000,000 1,000,000 0.74 $ 0.26 50,000 50,000 2.25 $ 0.33 50,000 25,000 2.19 $ 0.35 1,000,000 1,000,000 0.74 $ 0.45 190,000 190,000 2.76 $ 0.55 100,000 100,000 1.74 $ 0.55 100,000 100,000 1.74 $ 0.55 20,000 20,000 2.02 $ 0.63 300,000 300,000 3.00 $ 0.77 300,000 300,000 4.00 $ 0.90 50,000 50,000 4.37 $ 0.95 50,000 10,000 4.00 $ 2.32 300,000 - 4.70 $ 2.45 2,000,000 2,000,000 5.85 $ 2.50 100,000 - 4.66 $ 2.65 200,000 - 4.73 $ 2.85 75,000 - 3.95 $ 2.85 100,000 - 4.95 $ 3.00 25,000 - 4.96 $ 3.73 200,000 - 4.94 8,310,000 7,425,000 |
Warrants
Warrants | 12 Months Ended |
Dec. 31, 2018 | |
Warrants | |
Warrants | NOTE 14 – WARRANTS During the years ended December 31, 2018 and 2017, the Company issued warrants to purchase 8,661,137 and 3,120,311 shares of common stock, respectively, at exercise prices ranging from $0.20 to $5.50 per share in 2018 and $0.40 to $0.62 per share in 2017. These warrants generally expire three or five years from issuance date. The Company recorded the fair value of these warrants of approximately $15.7 million in 2018 ($1.8 million as compensation expense, $2.8 million as debt discounts, and $11.1 million as equity discounts) and approximately $1.0 million in 2017 (all as compensation expense). During the year ended December 31, 2018, warrants to purchase 2,300,237 shares of common stock were exercised, at exercise prices ranging from $0.10 to $1.75 per share. Of these exercised warrants, 1,000,000 warrants were cashless exercises, with the exercise price paid via the surrender of 157,527 shares of common stock. No warrants were exercised during 2017. The following table summarizes the Company’s warrant transactions during the 2018 and 2017 fiscal years: Number of Stock Options Weighted-Average Exercise Price Outstanding at December 31, 2016 1,125,000 $ 0.136 Granted 3,120,311 0.468 Exercised - - Forfeited/Expired - - Outstanding at December 31, 2017 4,245,311 0.380 Granted 8,661,137 2.548 Exercised (2,300,237 ) 0.385 Forfeited/Expired - - Outstanding at December 31, 2018 10,606,211 $ 2.149 At December 31, 2018, warrants to purchase 10,606,211 shares of common stock were outstanding at exercise prices ranging from $0.12 to $5.50 per share. |
Revenues
Revenues | 12 Months Ended |
Dec. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | NOTE 15 – REVENUES For the years ended December 31, 2018 and 2017, the Company’s revenues were comprised of the following major categories: 2018 2017 Real estate $ 5,798,996 $ 2,517,225 Management 1,581,548 1,193,854 Supply procurement 3,657,909 1,936,686 Licensing 700,173 269,256 Consulting 50,000 150,604 Other 63,289 228 Total revenues $ 11,851,915 $ 6,067,853 Revenue from two clients represented 73% and 81% of total revenues for the years ended December 31, 2018 and 2017, respectively. |
Non-Operating Income
Non-Operating Income | 12 Months Ended |
Dec. 31, 2018 | |
Non-operating Income | |
Non-Operating Income | NOTE 16 – NON-OPERATING INCOME In 2017, the Company wrote off approximately $227,000 of deferred revenue that represented the conversion of a promissory note issued to a third party by the Company’s former parent, and assumed by the Company in 201l, for future products and services related to the Company’s previous online portal business. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 17 – INCOME TAXES For the years ended December 31, 2018 and 2017, the Company’s cumulative net operating losses were approximately $11.6 million and $2.8 million, respectively, and accordingly a tax provision was not required for the years then ended. The reconciliations between the Company's effective tax rates and the statutory tax rate for the years ended December 31, 2018 and 2017 were as follows: 2018 2017 U.S Federal taxes at the statutory rate 21 % 34 % State taxes net of federal benefit 6 % 5 % Valuation allowance (27 )% (39 )% Total 0 % 0 % The approximate income tax effect of each type of temporary difference and carryforward as of December 31, 2018 and 2017 is as follows: 2018 2017 Deferred tax assets: Net operating loss carryforwards $ 3,121,086 $ 2,826,698 Deferred tax liabilities: Fixed assets (952,875 ) (10,918 ) Net deferred tax asset 2,168,210 2,815,780 Valuation allowance (2,168,210 ) (2,815,780 ) Total $ - $ - The Company uses the asset and liability method to account for income taxes in accordance with ASC 740, Income Taxes The Tax Cuts and Jobs Act (the “TCJA”) was enacted on December 22, 2017. Among other things, the TCJA reduces the U.S. federal corporate tax rate from 35% to 21%, requires companies to pay a one-time transition tax on earnings of certain foreign subsidiaries that were previously tax deferred, and creates new taxes on certain foreign sourced earnings. The one-time transition tax is based on the Company’s total post-1986 earnings and profits (“E&P”) for which the Company has previously deferred from U.S. income taxes. As of December 31, 2017, the Company recorded a provisional amount for the one-time transition tax liability of $36 for its foreign subsidiaries, resulting in an increase of income tax provision of $36. As of December 31, 2018, the Company has completed its calculation of the total post-1986 foreign E&P for these foreign subsidiaries. The Company has recognized an additional $16 in its income tax expense for its one-time transition tax liability. The Company has provided a valuation allowance against its net deferred tax assets at December 31, 2018 and 2017. Based upon the level of historical U.S. earnings and future projections over the period in which the net deferred tax assets are deductible, at this time, management believes it is more likely than not that the Company will not realize the benefits of these deductible differences. The federal net operating losses carryforward indefinitely, subject to an annual limitation of 80% of taxable income. The state net operating losses expire at various dates beginning in 2031. These tax attributes are subject to an annual limitation from equity shifts, which constitute and change of ownership as defined under IRC Section 382, which will limit their utilization. The Company has not completed a study through December 31, 2018 to assess whether an ownership change under Section of 382 of the Code has occurred during 2018, due to the costs and complexities associated with such a study. The Company may have experienced various ownership changes, as defined by the code, as a result of financing transactions. Accordingly, the Company’s ability to utilize the aforementioned carryforwards may be limited. Management assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets. A significant piece of objective negative evidence evaluated was the cumulative losses incurred through the period ended December 31, 2018. Such objective evidence limits the ability to consider the subjective evidence, such as our projections for future growth. On the basis of this evaluation, as of December 31, 2018, a valuation allowance has been recorded against all net deferred tax assets as these assets are more likely than not to be unrealized. The amount of the deferred tax asset considered realizable, however, could be adjusted if estimates of future taxable income during the carryforward period are reduced or increased or if objective negative evidence in the form of cumulative losses is no longer present and additional weight may be given to the subjective evidence such as our projections for growth. The Company previously adopted the provision for uncertain tax positions under ASC 740. The adoption did not have an impact on the Company’s retained earnings balance. At December 31, 2018 and 2017, the Company had no recorded liabilities for uncertain tax positions and had no accrued interest or penalties related to uncertain tax positions. The Company files income tax returns in the U.S. federal tax jurisdiction and various state jurisdictions. The Company is currently open to examination under the statute of limitations by the Internal Revenue Service and state jurisdictions for the tax years ended 2015 through 2018. Since the Company is in a U.S. loss carryforward position, carryforward tax attributes generated in prior years may still be adjusted upon future examination if they have or will be used in a future period. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 18 – RELATED PARTY TRANSACTIONS As disclosed in Note 3 – Acquisitions In September 2017, the former CEO of the Company, who is a currently a board member, exercised options to purchase 4.5 million shares of common stock at an exercise price of $0.01 per share. This individual’s aggregate exercise price of $45,000 was paid via the surrender of 90,000 shares of common stock. In October 2017, the Company acquired certain assets of the Betty’s Eddies™ brand of cannabis-infused products, as disclosed in Note 3 – Acquisitions In December 2017 and January 2018, options to purchase 400,000 shares of commons stock at an exercise price of $0.025 were forfeited by the CEO and by an independent board member (200,000 shares forfeited by each individual). In January 2018, the Company granted options to purchase 1.45 million shares of common stock to the Company’s board members at exercise prices ranging from $0.14 to $0.77 and expiring between December 2020 and December 2022. The fair value of these options on grant date of approximately $458,000 was amortized over the six-month vesting period. The Company’s current corporate offices are leased from a company owned by a related party under a 10-year lease that commenced August 2018 and contains a five-year extension option. Previous to this lease, the Company’s former corporate offices were also leased from a company owned by a related party. For the years ended December 31, 2018 and 2017, expenses incurred under these leases approximated $78,000 and $24,000, respectively. The outstanding Due To Related Parties The outstanding Due From Related Parties |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 19 – COMMITMENTS AND CONTINGENCIES Operating Lease Commitments The Company leases facilities under several operating leases that contain rent holidays and customary escalations of lease payments for the type of facilities being leased. The Company recognizes rent expense on a straight-line basis over the expected lease term, including cancelable option periods which the Company fully expected to exercise. The differences between amounts paid and amounts expensed are recorded under Deferred Rents Payable The location of the Company’s leased facilities and descriptions of the lease agreements are as follows: ● Delaware – 4,000 square feet of retail space in a multi-use building under a five-year lease that commenced in October 2016 and contains a five-year option to extend the term. The Company developed the space into a cannabis dispensary which is subleased to its cannabis-licensed client. Also in Delaware, in March 2019, the Company entered into a lease of a 100,000 square foot warehouse that it intends to construct into a cultivation and processing facility to be subleased to the same Delaware client. The lease term is 10 years, with an option to extend the term for three additional five-year periods. ● Nevada – 10,000 square feet of an industrial building that the Company built-out into a cannabis cultivation facility and is subleased to the Company’s cannabis-licensed client under a sub-lease which is coterminous with the Company’s lease for 10 years expiring in 2024. ● Massachusetts – 10,000 square feet of office space which the Company utilizes as its corporate offices under a 10-year lease with a related party expiring in 2028 which contain a 5-year extension option. ● Maryland – a 2,700 square foot 2-unit apartment under a lease that expires in July 2020 with an option to renew for a two-year term. For the years ended December 31, 2018 and 2017, rent expense approximated $436,000 and $183,000, respectively. Future minimum lease payments as of December 31, 2018 under all non-cancelable operating leases having an initial or remaining term of more than one year were: 2019 $ 398,731 2020 797,120 2021 894,450 2022 882,068 2023 858,136 Thereafter 4,547,028 Total $ 8,377,533 Terminated Employment Agreement An employment agreement with the former CEO of the Company that provided this individual with salary, car allowances, stock options, life insurance, and other employee benefits, was terminated in 2017. The Company maintained an accrual of approximately $1,043,000 at December 31, 2018 and 2017 for any amounts that may be owed under this agreement, although the Company contends that such agreement is not valid. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 20 – SUBSEQUENT EVENTS GenCanna Debentures Conversion In February 2019, the Company converted the entire $30 million investment in subordinated secured convertible debentures of GenCanna plus accrued interest through the conversion date into common stock of GenCanna equal to a 33.5% ownership interest on a fully diluted basis. As a result of the conversion, the Company will account for this investment in accordance with the equity method. Also during this month, the Company’s CEO was appointed to GenCanna’s board. Acquisitions In February 2019, the Company contracted to purchase a 70% interest in Meditaurus LLC, a company established by Dr. Jokubas Ziburkas who holds a PhD in neuroscience and is a leading authority on hemp-based CBD and the endocannabinoid system. Meditaurus currently operates in the United States and Europe and has developed proprietary CBD formulations sold under its Florance Real Estate In March 2019, the Company entered into a lease with an option to purchase a 100,000 square foot warehouse located in Milford, Delaware. The lease term is 10 years, with an option to extend the term for three additional five-year periods. Build-out of the first 60,000 square feet into a cultivation and processing facility has commenced, and is expected to be completed by October 2019. Investment In January 2019, the Company entered into an agreement with Maryland Health & Wellness Center Inc. (“MHWC”, an entity that has been pre-approved for a cannabis dispensing license, to provide MHWC with a construction loan of $300,000 in connection with the buildout of MHWC’s proposed dispensary location. MHWC issued a promissory note to the Company for the amount of the loan at a rate of 8% per annum that matures in January 2023, provided however, upon the two year anniversary of the date of final state approval of MHWC’s dispensing license, the Company shall have the right, subject to state approval, to convert the note into shares of MHWC’s common stock which shall be equivalent to 20% ownership of MWHC. Consulting Agreement At the same time as the aforementioned investment in MHWC, the Company entered into a consulting services agreement with MHWC whereby the Company will provide advisory and oversight services to MHWC over a three-year period relating to the development, administration, operation, and management of MHWC's proposed dispensary in Maryland. The Company’s fee for such services shall be equal to 20% of MHWC’s net income of the business, as defined in the agreement. Promissory Note Issuance In March 2019, the Company raised $6 million from the issuance a of promissory note bearing interest at the rate of 10% per annum. This note is due and payable in January 2020. Conversion of Note Receivable In January, the Company’s note receivable balance of approximately $258,000 from Chooze Corp. was converted into a 2.7% ownership interest in Chooze. As of the conversion date, the Company will account for this investment in accordance with the provisions of ASC 321, Investments – Equity Securities Equity Transactions ● The Company sold 799,995 shares of common stock at a price of $3.25 per share resulting in aggregate proceeds of $2.6 million. ● Warrants to purchased 22,000 shares of common stock were exercised at exercise prices of $0.50 to $0.40. The Company received exercise proceeds of $15,800 from these exercises. ● Options to purchase 50,000 shares of common stock were exercised at an exercise price of $0.26 per share. The Company received exercise proceeds of $13,000 from this exercise. ● Options to purchase 350,000 shares of common stock were exercised on a cashless basis with the exercise prices paid via the surrender of 139,985 shares of common stock. ● The holder of the $10M Debentures converted $600,000 of principal and approximately $97,000 of accrued interest into 233,194 shares of common stock at conversion prices ranging from $2.90 and $3.06 per share. ● The Company issued 97,136 shares of common stock associated with the same number common stock subscriptions outstanding on December 31, 2018. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). Certain reclassifications have been made to prior periods’ data to conform to the current period presentation. These reclassifications had no effect on consolidated income (losses) or cash flows. |
Principles of Consolidation | Principles of Consolidation The accompanying condensed consolidated financial statements at December 31, 2018 and 2017 and for the years then ended include the accounts of MariMed Inc. and the following majority-owned subsidiaries. Subsidiary: Percentage Owned MariMed Advisors Inc. 100.0 % Mia Development LLC 89.5 % Mari Holdings IL LLC 60.0 % Mari Holdings MD LLC 97.4 % Mari Holdings NV LLC 100.0 % Hartwell Realty Holdings LLC 100.0 % iRollie LLC 100.0 % ARL Healthcare Inc. 100.0 % Intercompany transactions have been eliminated upon consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts within the financial statements and disclosures thereof. Actual results could differ from these estimates or assumptions. |
Cash Equivalents | Cash Equivalents The Company considers all highly liquid investments with a maturity date of three months or less to be cash equivalents. The fair values of these investments approximate their carrying values. The Company’s cash and cash equivalents are maintained with recognized financial institutions located in the United States. In the normal course of business, the Company may carry balances with certain financial institutions that exceed federally insured limits. The Company has not experienced losses on balances in excess of such limits and management believes the Company is not exposed to significant risks in that regard. |
Accounts Receivable | Accounts Receivable Accounts receivable consist of trade receivables and are carried at their estimated collectible amounts. The Company provides credit to its clients in the form of payment terms. The Company limits its credit risk by performing credit evaluations of its clients and maintaining a reserve, if deemed necessary, for potential credit losses. Such evaluations include the review of a client’s outstanding balances with consideration towards such client’s historical collection experience, as well as prevailing economic and market conditions and other factors. Based on such evaluations, the Company recorded a reserve of $150,000 at December 31, 2018. The accounts receivable balances of two clients constituted 84% of total accounts receivable at December 31, 2018. The balances of these two clients represented 79% of total accounts receivable at December 31, 2017. |
Investments | Investments The Company classifies its investments as available-for-sale-investments. Investments are comprised of equity holding of private companies These investments are recorded at fair value on the Company’s consolidated balance sheet, with changes to fair value, if any, included in comprehensive income. Investments are evaluated for other-than-temporary impairment and are written down if such impairments are deemed to have occurred. |
Revenue Recognition | Revenue Recognition On January 1, 2018, the Company adopted the Financial Accounting Standards Board’s Accounting Standards Codification (“ASC”) 606, Revenue from Contract with Customers, ● Identify the contract(s) with a customer; ● Identify the performance obligations in the contract(s); ● Determine the transaction price; ● Allocate the transaction price to the performance obligations in the contract(s); and ● Recognize revenue as the performance obligation is satisfied. Additionally, when another party is involved in providing goods or services to the Company’s clients, a determination is made as to who—the Company or the other party—is acting in the capacity as the principal in the sale transaction, and who is merely the agent arranging for goods or services to be provided by the other party. The Company is typically considered the principal if it controls the specified good or service before such good or service is transferred to its client. The Company may also be deemed to be the principal even if it engages another party (an agent) to satisfy some of the performance obligations on its behalf, provided the Company (i) takes on certain responsibilities, obligations and risks, (ii) possesses certain abilities and discretion, or (iii) other relevant indicators of the sale. If deemed an agent, the Company would not recognize revenue for the performance obligations it does not satisfy. The adoption of this standard did not have a significant impact on the Company’s consolidated operating results, and accordingly no restatement has been made to prior period reported amounts. The Company’s main sources of revenue are comprised of the following: ● Real Estate – the Company generates rental income and additional rental fees from leasing its regulatory-compliant legal cannabis facilities to its clients, which are cannabis-licensed operating companies. Rental income is generally a fixed amount per month that escalates over the respective lease terms, while additional rental fees are based on a percentage of tenant revenues that exceed a specified amount. ● Management – the Company receives fees for providing its clients with corporate services and operational oversight of their cannabis cultivation, production, and dispensary operations. These fees are based on a percentage of such clients’ revenue, and are recognized after services have been performed. ● Supply Procurement – the Company maintains volume discounts with top national vendors of cultivation and production resources, supplies, and equipment, which the Company acquires and resells to its clients or third parties within the cannabis industry. The Company recognizes this revenue after the acceptance of goods by the purchaser. ● Licensing – the Company’s derives revenue from the sale of precision-dosed, cannabis-infused products, such as Kalm Fusion™ and Betty’s Eddies™, to legal dispensaries throughout the United States. The recognition of this revenue occurs when the products are delivered. ● Consulting – the Company assists third-parties parties in securing cannabis licenses, and provides advisory services in the areas of facility design and development, and cultivation and dispensing best practices. The revenues associated with these services are recognized as the services are performed. |
Research and Development Costs | Research and Development Costs Research and development costs are charged to operations as incurred. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost less accumulated depreciation, with depreciation recognized on a straight-line basis over the shorter of the estimated useful life of the asset or the lease term, if applicable. When assets are retired or disposed, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are included in income. Repairs and maintenance are charged to expense in the period incurred. The estimated useful lives of property and equipment are generally as follows: buildings and building improvements, seven to thirty-nine years; tenant improvements, the remaining duration of the related lease; furniture and fixtures, seven years; machinery and equipment, five to ten years. Land is not depreciated. The Company’s property and equipment are individually reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment exists when the carrying amount of an asset exceeds the aggregate projected future cash flows over the anticipated holding period on an undiscounted basis. An impairment loss is measured based on the excess of the asset’s carrying amount over its estimated fair value. Impairment analyses are based on management’s current plans, intended holding periods and available market information at the time the analyses are prepared. If these criteria change, the Company’s evaluation of impairment losses may be different and could have a material impact to the consolidated financial statements. For the years ended December 31, 2018 and 2017, based on its impairment analyses, the Company did not have any impairment losses. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company evaluates the recoverability of its fixed assets and other assets in accordance with ASC 360-10-15, Impairment or Disposal of Long-Lived Assets |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company follows the provisions of ASC 820, Fair Value Measurement Financial Instruments, Level 1 Quoted market prices available in active markets for identical assets or liabilities as of the reporting date. Level 2 Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 3 Pricing inputs that are generally observable inputs and not corroborated by market data. The carrying amounts of the Company’s financial assets and liabilities, such as cash and accounts payable approximate their fair values due to the short maturity of these instruments. The fair value of option and warrant issuances are determined using the Black-Scholes pricing model and employing several inputs such as the expected life of instrument, the exercise price, the expected risk-free interest rate, the expected dividend yield, the value of the Company’s common stock on issuance date, and the expected volatility of such common stock. The following table summarizes the range of inputs used by the Company during the prior two fiscal years: 2018 2017 Life of instrument 0.5 to 5.0 years 3.0 to 5.0 years Volatility factors 1.019 to 2.086 0.963 to 1.095 Risk-free interest rates 1.65% to 3.07% 1.79% to 2.08% Dividend yield 0% 0% The expected life of an instrument is calculated using the simplified method pursuant to Staff Accounting Bulletin Topic 14, Share-Based Payment The Company amortizes the fair value of option and warrant issuances on a straight-line basis over the requisite service period of each instrument. |
Extinguishment of Liabilities | Extinguishment of Liabilities The Company accounts for extinguishment of liabilities in accordance with ASC 405-20, Extinguishments of Liabilities. |
Stock-based Compensation | Stock-Based Compensation The Company accounts for stock-based compensation using the fair value method as set forth in ASC 718, Compensation—Stock Compensation, |
Income Taxes | Income Taxes The Company accounts for income taxes in accordance with ASC 740, Income Taxes ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. The Company did not take any uncertain tax positions and had no adjustments to unrecognized income tax liabilities or benefits for the years ended December 31, 2018 and 2017. |
Related Party Transactions | Related Party Transactions The Company follows ASC 850, Related Party Disclosures In accordance with ASC 850, the Company’s financial statements include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business, as well as transactions that are eliminated in the preparation of financial statements. |
Comprehensive Income | Comprehensive Income The Company reports comprehensive income and its components following guidance set forth by ASC 220, Comprehensive Income |
Earnings Per Share | Earnings Per Share Earnings per common share is computed pursuant to ASC 260, Earnings Per Share As of December 31, 2018 and 2017, there were 18,916,211 and 9,045,311, respectively, of potentially dilutive securities in the form of options and warrants. Also as of such dates, there were (i) zero and 500,000 shares, respectively, of subscriptions on convertible preferred stock, (ii) $3,350,000 and $1,350,000, respectively, of convertible promissory notes, and (iii) approximately $8.6 million and zero, respectively, of convertible debentures payable, that were potentially dilutive, and whose conversion into common stock is based on a discount to the market value of common stock on or about the future conversion date. For the years ended December 31, 2018 and 2017, all potentially dilutive securities had an anti-dilutive effect on earnings per share, and in accordance with ASC 260, were excluded from the diluted net income per share calculation, resulting in identical calculations of basic and fully diluted net income per share. These securities may dilute earnings per share in the future. |
Commitments and Contingencies | Commitments and Contingencies The Company follows ASC 450, Contingencies If the assessment of a contingency indicates that it is probable that a material loss will be incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. While not assured, management does not believe, based upon information available at this time, that a loss contingency will have material adverse effect on the Company’s financial position, results of operations, or cash flows. |
Beneficial Conversion Features on Convertible Debt | Beneficial Conversion Features on Convertible Debt Convertible instruments that are not bifurcated as a derivative pursuant to ASC 815, Derivatives and Hedging A beneficial conversion feature is a nondetachable conversion feature that is “in-the-money” at the commitment date. The in-the-money portion, also known as the intrinsic value of the option, is recorded in equity, with an offsetting discount to the carrying amount of convertible debt to which it is attached. The discount is amortized to interest expense over the life of the debt with adjustments to amortization upon full or partial conversions of the debt. |
Risk and Uncertainties | Risk and Uncertainties The Company is subject to risks common to companies operating within the legal and medical marijuana industries, including, but not limited to, federal laws, government regulations and jurisdictional laws. |
Noncontrolling Interests | Noncontrolling Interests Noncontrolling interests represent third-party minority ownership of the Company’s consolidated subsidiaries. Net income attributable to noncontrolling interests is shown in the consolidated statements of operations; the value of net assets owned by noncontrolling interests are presented as a component of equity within the balance sheets. |
Off-Balance Sheet Arrangements | Off-Balance Sheet Arrangements The Company does not have any off-balance sheet arrangements. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02, Leases (Topic 842) In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350) In June 2018, the FASB issued ASU 2018-07, Compensation - Stock Compensation (Topic 718): Improvement to Nonemployee Share-Based Payment Accounting, In addition to the above, the Company has reviewed all other recently issued, but not yet effective, accounting pronouncements, and does not believe the future adoption of any such pronouncements will have a material impact on its financial condition or the results of its operations. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Schedule of Majority Owned Subsidiaries | The accompanying condensed consolidated financial statements at December 31, 2018 and 2017 and for the years then ended include the accounts of MariMed Inc. and the following majority-owned subsidiaries. Subsidiary: Percentage Owned MariMed Advisors Inc. 100.0 % Mia Development LLC 89.5 % Mari Holdings IL LLC 60.0 % Mari Holdings MD LLC 97.4 % Mari Holdings NV LLC 100.0 % Hartwell Realty Holdings LLC 100.0 % iRollie LLC 100.0 % ARL Healthcare Inc. 100.0 % |
Schedule of Assumptions Used | The following table summarizes the range of inputs used by the Company during the prior two fiscal years: 2018 2017 Life of instrument 0.5 to 5.0 years 3.0 to 5.0 years Volatility factors 1.019 to 2.086 0.963 to 1.095 Risk-free interest rates 1.65% to 3.07% 1.79% to 2.08% Dividend yield 0% 0% |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Betty's Eddies [Member] | |
Schedule of Fair Value of the Assets Acquired On the Acquisition | The following table summarizes the allocation of the purchase price to the fair value of the assets acquired on the acquisition date: Inventory $ 46,544 Machinery and equipment 130,255 Goodwill 333,201 Total fair value of consideration $ 510,000 |
iRollie LLC [Member] | |
Schedule of Fair Value of the Assets Acquired On the Acquisition | The following table summarizes the allocation of the purchase price to the fair value of the assets acquired: Cash and cash equivalents $ 13,494 Goodwill 266,682 Total fair value of consideration $ 280,176 |
ARL Healthcare Inc [Member] | |
Schedule of Fair Value of the Assets Acquired On the Acquisition | The following table summarizes the allocation of the purchase price to the fair value of the assets acquired and liabilities assumed on the acquisition date: Equipment $ 21,000 Cannabis licenses 180,000 Accounts payable (120,689 ) Due to related parties (92,765 ) Total identifiable net assets (7,454 ) Goodwill 731,902 Total fair value of consideration $ 724,448 |
Deferred Rents Receivable (Tabl
Deferred Rents Receivable (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Revenue Recognition and Deferred Revenue [Abstract] | |
Schedule of Future Minimum Rental Receipts for Non-cancelable Leases and Subleases | Future minimum rental receipts for non-cancelable leases and subleases as of December 31, 2018 were: 2019 $ 1,261,181 2020 1,287,257 2021 1,315,686 2022 1,193,990 2023 1,179,641 Thereafter 14,571,268 Total $ 20,809,023 |
Due from Third Parties (Tables)
Due from Third Parties (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Notes to Financial Statements | |
Schedule of Due from Third Parties | At December 31, 2018 and 2017, the balances due from third parties were comprised the following amounts advanced to the Company’s cannabis-licensed clients for working capital purposes: 2018 2017 Kind Therapeutics USA Inc. (Maryland licensee) $ 2,679,496 $ 77,558 KPG of Anna LLC (Illinois licensee) 482,700 418,305 KPG of Harrisburg LLC (Illinois licensee) 449,385 382,260 Harvest Foundation LLC (Nevada licensee) 248,796 40,693 ARL Healthcare Inc. (Massachusetts licensee) - 176,823 Other - 101,279 Total due from third parties $ 3,860,377 $ 1,196,918 |
Notes Receivable (Tables)
Notes Receivable (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Receivables [Abstract] | |
Schedule of Notes Receivable | At December 31, 2018 and 2017, notes receivable were comprised of the following: 2018 2017 First State Compassion Center -12.5% per annum, maturing in 2026 $ 578,723 $ 624,275 The Healer - 8% per annum, maturing in 2021 307,429 - Chooze Corp. - 8% per annum, maturing in 2021 257,687 - Total notes receivable 1,143,839 624,167 Current portion of First State Compassion Center note receivable 51,462 45,444 Notes receivable, long-term portion $ 1,092,377 $ 578,831 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Fixed Assets | At December 31, 2018 and 2017, property and equipment consisted of the following: 2018 2017 Land $ 3,392,710 $ 3,392,710 Buildings and building improvements 13,566,144 3,918,359 Tenant improvements 5,348,882 2,260,512 Furniture and fixtures 114,160 95,815 Machinery and equipment 1,632,351 506,464 Construction in progress 12,205,447 17,279,949 36,259,694 27,453,809 Less: accumulated depreciation (2,159,830 ) (1,498,878 ) Property and equipment, net $ 34,099,864 $ 25,954,931 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Aggregate Maturities of Debt Outstanding | The aggregate scheduled maturities of the Company’s total debt outstanding, inclusive of the promissory notes and mortgages described within this Note 10 – Debt Debentures Payable 2019 $ 5,154,404 2020 9,070,954 2021 235,827 2022 251,543 2023 268,338 Thereafter 5,544,226 Total 20,525,292 Less discounts (5,553,339 ) $ 14,971,953 |
Stock Options (Tables)
Stock Options (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Schedule of Stock Options Transactions | The following table summarizes the Company’s stock option transactions during the 2018 and 2017 fiscal years: Number of Stock Options Weighted-Average Exercise Price Outstanding at December 31, 2016 9,250,000 $ 0.100 Granted 550,000 0.458 Exercised (4,800,000 ) 0.011 Forfeited/Expired (200,000 ) 0.025 Outstanding at December 31, 2017 4,800,000 0.234 Granted 4,720,000 1.805 Exercised (760,000 ) 0.216 Forfeited/Expired (450,000 ) 0.433 Outstanding at December 31, 2018 8,310,000 $ 1.117 |
Schedule of Stock Options Outstanding and Exercisable | Stock options outstanding and exercisable as of December 31, 2018 were: Exercise Price Shares Under Option Remaining per Share Outstanding Exercisable Life in Years $ 0.08 250,000 250,000 0.08 $ 0.08 100,000 100,000 0.97 $ 0.13 200,000 200,000 1.50 $ 0.14 650,000 650,000 2.00 $ 0.15 1,000,000 1,000,000 0.74 $ 0.25 1,000,000 1,000,000 0.74 $ 0.26 50,000 50,000 2.25 $ 0.33 50,000 25,000 2.19 $ 0.35 1,000,000 1,000,000 0.74 $ 0.45 190,000 190,000 2.76 $ 0.55 100,000 100,000 1.74 $ 0.55 100,000 100,000 1.74 $ 0.55 20,000 20,000 2.02 $ 0.63 300,000 300,000 3.00 $ 0.77 300,000 300,000 4.00 $ 0.90 50,000 50,000 4.37 $ 0.95 50,000 10,000 4.00 $ 2.32 300,000 - 4.70 $ 2.45 2,000,000 2,000,000 5.85 $ 2.50 100,000 - 4.66 $ 2.65 200,000 - 4.73 $ 2.85 75,000 - 3.95 $ 2.85 100,000 - 4.95 $ 3.00 25,000 - 4.96 $ 3.73 200,000 - 4.94 8,310,000 7,425,000 |
Warrants (Tables)
Warrants (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Warrants | |
Summary of Warrant Transactions | The following table summarizes the Company’s warrant transactions during the 2018 and 2017 fiscal years: Number of Stock Options Weighted-Average Exercise Price Outstanding at December 31, 2016 1,125,000 $ 0.136 Granted 3,120,311 0.468 Exercised - - Forfeited/Expired - - Outstanding at December 31, 2017 4,245,311 0.380 Granted 8,661,137 2.548 Exercised (2,300,237 ) 0.385 Forfeited/Expired - - Outstanding at December 31, 2018 10,606,211 $ 2.149 |
Revenues (Tables)
Revenues (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Revenues Comprised of Major Categories | For the years ended December 31, 2018 and 2017, the Company’s revenues were comprised of the following major categories: 2018 2017 Real estate $ 5,798,996 $ 2,517,225 Management 1,581,548 1,193,854 Supply procurement 3,657,909 1,936,686 Licensing 700,173 269,256 Consulting 50,000 150,604 Other 63,289 228 Total revenues $ 11,851,915 $ 6,067,853 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of Reconciliation of Income Taxes | The reconciliations between the Company's effective tax rates and the statutory tax rate for the years ended December 31, 2018 and 2017 were as follows: 2018 2017 U.S Federal taxes at the statutory rate 21 % 34 % State taxes net of federal benefit 6 % 5 % Valuation allowance (27 )% (39 )% Total 0 % 0 % |
Schedule of Deferred Tax Asset | The approximate income tax effect of each type of temporary difference and carryforward as of December 31, 2018 and 2017 is as follows: 2018 2017 Deferred tax assets: Net operating loss carryforwards $ 3,121,086 $ 2,826,698 Deferred tax liabilities: Fixed assets (952,875 ) (10,918 ) Net deferred tax asset 2,168,210 2,815,780 Valuation allowance (2,168,210 ) (2,815,780 ) Total $ - $ - |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Lease Payments Under All Non-cancelable Operating Leases | Future minimum lease payments as of December 31, 2018 under all non-cancelable operating leases having an initial or remaining term of more than one year were: 2019 $ 398,731 2020 797,120 2021 894,450 2022 882,068 2023 858,136 Thereafter 4,547,028 Total $ 8,377,533 |
Organization and Description _2
Organization and Description of Business (Details Narrative) | 1 Months Ended | ||
Jun. 30, 2017shares | Dec. 31, 2018ft² | Dec. 31, 2017 | |
Area of Land | ft² | 300,000 | ||
Ownership percentage | 100.00% | ||
MariMed Advisors Inc. [Member] | |||
Ownership percentage | 49.00% | ||
Common stock shares acquired | shares | 75,000,000 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Impairment losses | ||
Unrecognized tax liabilities or benefits | ||
Convertible Promissory Notes [Member] | ||
Potentially dilutive securities | 3,350,000 | 1,350,000 |
Convertible Debentures Payable [Member] | ||
Potentially dilutive securities | 8,600,000 | 0 |
Options and Warrants [Member] | ||
Potentially dilutive securities | 18,916,211 | 9,045,311 |
Convertible Preferred Stock [Member] | ||
Potentially dilutive securities | 0 | 500,000 |
Buildings and Building Improvements [Member] | Minimum [Member] | ||
Estimated useful lives of property and equipment | 7 years | |
Buildings and Building Improvements [Member] | Maximum [Member] | ||
Estimated useful lives of property and equipment | 39 years | |
Furniture and Fixtures [Member] | ||
Estimated useful lives of property and equipment | 7 years | |
Machinery and Equipment [Member] | Minimum [Member] | ||
Estimated useful lives of property and equipment | 5 years | |
Machinery and Equipment [Member] | Maximum [Member] | ||
Estimated useful lives of property and equipment | 10 years | |
Accounts Receivable [Member] | ||
Debt collectible reserve | $ 150,000 | |
Concentration risk, percentage | 84.00% | 79.00% |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Majority Owned Subsidiaries (Details) | Dec. 31, 2018 | Dec. 31, 2017 |
Percentage Owned | 100.00% | |
MariMed Advisors Inc. [Member] | ||
Percentage Owned | 100.00% | |
Mia Development LLC [Member] | ||
Percentage Owned | 89.50% | |
Mari Holdings IL LLC [Member] | ||
Percentage Owned | 60.00% | |
Mari Holdings MD LLC [Member] | ||
Percentage Owned | 97.40% | |
Mari Holdings NV LLC [Member] | ||
Percentage Owned | 100.00% | |
Hartwell Realty Holdings LLC [Member] | ||
Percentage Owned | 100.00% | |
iRollie LLC [Member] | ||
Percentage Owned | 100.00% | |
ARL Healthcare Inc [Member] | ||
Percentage Owned | 100.00% |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Schedule of Assumptions Used (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Measurement Input, Expected Term [Member] | Minimum [Member] | ||
Fair value assumptions, measurement input, term | 6 months | 3 years |
Measurement Input, Expected Term [Member] | Maximum [Member] | ||
Fair value assumptions, measurement input, term | 5 years | 5 years |
Measurement Input, Price Volatility [Member] | Minimum [Member] | ||
Fair value assumptions, measurement input, Volatility factors | $ 1.019 | $ 0.963 |
Measurement Input, Price Volatility [Member] | Maximum [Member] | ||
Fair value assumptions, measurement input, Volatility factors | $ 2.086 | $ 1.095 |
Measurement Input, Risk Free Interest Rate [Member] | Minimum [Member] | ||
Fair value assumptions, measurement input, percentages | 1.65% | |
Measurement Input, Risk Free Interest Rate [Member] | Maximum [Member] | ||
Fair value assumptions, measurement input, percentages | 3.07% | 2.08% |
Measurement Input, Expected Dividend Rate [Member] | ||
Fair value assumptions, measurement input, percentages | 0.00% | 0.00% |
Acquisitions (Details Narrative
Acquisitions (Details Narrative) - USD ($) | Nov. 30, 2018 | Oct. 31, 2018 | Apr. 30, 2018 | Oct. 31, 2017 | Jun. 30, 2017 | May 31, 2014 | Dec. 31, 2018 | Dec. 31, 2017 | Jul. 31, 2018 |
Stock issued during period, value, acquisitions | $ 1,195,561 | ||||||||
Written down of goodwill | 1,331,785 | ||||||||
Stock issued during period, value, purchase of assets | 370,000 | ||||||||
Impairment on goodwill | 1,331,785 | ||||||||
Number of shares subscriptions on common stock equity interest | 75,000,000 | ||||||||
Ownership percentage | 100.00% | ||||||||
MariMed Advisors Inc. [Member] | |||||||||
Stock issued during period, shares, acquisitions | 75,000,000 | ||||||||
Ownership percentage | 49.00% | ||||||||
MariMed Advisors Inc. [Member] | |||||||||
Percentage on minority ownership interest | 49.00% | ||||||||
Sigal Consulting LLC [Member] | |||||||||
Stock issued during period, shares, acquisitions | 31,954,236 | ||||||||
Stock issued during period, value, acquisitions | $ 590,000 | ||||||||
Percentage on outstanding shares | 50.00% | ||||||||
Sigal Consulting LLC [Member] | MariMed Advisors Inc. [Member] | |||||||||
Number of common stock exchanged | 7,500,000 | ||||||||
Sigal Consulting LLC [Member] | Options [Member] | |||||||||
Options to purchase shares of common stock | 300,000 | ||||||||
Options exercisable term | 5 years | ||||||||
Options to purchase shares of common stock, value | $ 570,000 | ||||||||
Written down of goodwill | $ 0 | ||||||||
Sigal Consulting LLC [Member] | Options [Member] | Minimum [Member] | |||||||||
Exercise price of options | $ 0.15 | ||||||||
Sigal Consulting LLC [Member] | Options [Member] | Maximum [Member] | |||||||||
Exercise price of options | $ 0.35 | ||||||||
Sigal Consulting LLC [Member] | MariMed Advisors Inc. [Member] | |||||||||
Percentage on minority ownership interest | 49.00% | ||||||||
Betty's Eddies [Member] | |||||||||
Options to purchase shares of common stock, value | $ 370,000 | ||||||||
Written down of goodwill | 333,000 | ||||||||
Stock issued during period, shares, purchase of assets | 140,000 | ||||||||
Stock issued during period, value, purchase of assets | $ 1,000,000 | ||||||||
Description on royalties percentage | In addition, Icky shall receive royalties based on a percentage of the Company's sales of the Betty's Eddies™ product line, commencing at 25% and decreasing to 2.5% as certain sales thresholds are met. | ||||||||
Royalties | 16,000 | $ 10,000 | |||||||
Impairment on goodwill | |||||||||
iRollie LLC [Member] | |||||||||
Number of shares subscriptions on common stock equity interest | 264,317 | ||||||||
Value of common stock issued to former owner | $ 280,176 | ||||||||
Ownership percentage | 100.00% | ||||||||
Impairment of intangible assets | |||||||||
ARL Healthcare Inc [Member] | |||||||||
Written down of goodwill | $ 732,000 | ||||||||
Licenses cost | $ 185,000 | ||||||||
AgriMed Industries of PA LLC [Member] | |||||||||
Percentage of interests acquired in business acquisition | 100.00% | ||||||||
AgriMed Industries of PA LLC [Member] | Maximum [Member] | |||||||||
Fair value of assets acquired and liabilities assumed, liabilities | $ 700,000 | ||||||||
KPG of Anna LLC and KPG of Harrisburg LLC [Member] | |||||||||
Stock issued during period, shares, acquisitions | 1,000,000 | ||||||||
Percentage of interests acquired in business acquisition | 100.00% | ||||||||
The Harvest Foundation LLC [Member] | |||||||||
Percentage of interests acquired in business acquisition | 100.00% |
Acquisitions - Schedule of Fair
Acquisitions - Schedule of Fair Value of the Assets Acquired On the Acquisition (Details) | Dec. 31, 2018USD ($) |
iRollie LLC [Member] | |
Inventory | $ 46,544 |
Machinery and equipment | 130,255 |
Goodwill | 333,201 |
Total fair value of consideration | 510,000 |
Betty's Eddies [Member] | |
Goodwill | 266,682 |
Cash and cash equivalents | 13,494 |
Total fair value of consideration | 280,176 |
ARL Healthcare Inc [Member] | |
Machinery and equipment | 21,000 |
Goodwill | 731,902 |
Cannabis licenses | 180,000 |
Accounts payable | (120,689) |
Due to related parties | (92,765) |
Total identifiable net assets | (7,454) |
Total fair value of consideration | $ 724,448 |
Investments (Details Narrative)
Investments (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | ||
Dec. 31, 2018 | Aug. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Investments | $ 1,672,163 | $ 1,672,163 | ||
Number of common stock shares issued, values | $ 31,821,001 | $ 6,578,000 | ||
CVP Worldwide LLC [Member] | ||||
Percentage on minority ownership interest | 23.00% | 23.00% | ||
Number of revenue shares earned | ||||
Sprout [Member] | ||||
Investments | $ 300,000 | $ 300,000 | ||
Contracted cash investment | 500,000 | $ 500,000 | ||
Number of common stock issued during period | 378,259 | |||
Number of common stock shares issued, values | $ 915,000 | |||
Equity Method Investments | 43,000 | 43,000 | ||
Equity method investment market value | 1,172,000 | 1,172,000 | ||
Vitiprints [Member] | Licensing Agreement [Member] | ||||
Non-refundable payment | $ 250,000 | |||
Percentage of royalty on net revenue | 10.00% | |||
Payments for royalties | $ 250,000 | |||
Description on royalty payments | In order to maintain the exclusivity of the license, the Company shall make minimum royalty payments of (i) $500,000 for the year following the first sale date, as defined, (ii) $750,000 for the following year, and (iii) $1,000,000 for all remaining years during the initial or renewal terms. | |||
DabTabs™ [Member] | Iconic Ventures Inc. [Member] | ||||
Investments | $ 500,000 | $ 500,000 | ||
Number of shares purchased during the period | 2,500,000 | |||
Value of shres purchased during period | $ 500,000 | |||
DabTabs™ [Member] | Iconic Ventures Inc. [Member] | Maximum [Member] | ||||
Percentage on minority ownership interest | 15.00% | 15.00% |
Deferred Rents Receivable (Deta
Deferred Rents Receivable (Details Narrative) | 12 Months Ended | |
Dec. 31, 2018USD ($)ft² | Dec. 31, 2017USD ($) | |
Area of land | 300,000 | |
Cumulative fixed rental receipts | $ | $ 5,400,000 | $ 2,800,000 |
Revenue recognized | $ | 7,500,000 | 3,400,000 |
Deferred rents receivable | $ | $ 2,100,000 | $ 611,000 |
Delaware [Member ] | ||
Non-cancelable lease agreement, term | 20 years | |
Area of land | 45,000 | |
Percentage of space occupyed | 100.00% | |
Lease expiration description | Lease expiring in 2035 | |
Delaware [Member ] | Retails Space [Member ] | ||
Area of land | 4,000 | |
Illinois [Member ] | ||
Non-cancelable lease agreement, term | 20 years | |
Area of land | 3,400 | |
Lease expiration description | Lease expiring in 2036 | |
MARYLAND [Member ] | ||
Non-cancelable lease agreement, term | 20 years | |
Area of land | 180,000 | |
NEVADA [Member ] | ||
Non-cancelable lease agreement, term | 10 years | |
Area of land | 10,000 | |
Lease expiration description | Expiring in 2024 | |
Sales Revenue [Member] | Customer Concentration Risk [Member] | ||
Non-cancelable lease agreement, term | 20 years |
Deferred Rents Receivable - Sch
Deferred Rents Receivable - Schedule of Future Minimum Rental Receipts for Non-cancelable Leases and Subleases (Details) | Dec. 31, 2018USD ($) |
Revenue Recognition and Deferred Revenue [Abstract] | |
2019 | $ 1,261,181 |
2020 | 1,287,257 |
2021 | 1,315,686 |
2022 | 1,193,990 |
2023 | 1,179,641 |
Thereafter | 14,571,268 |
Total | $ 20,809,023 |
Due from Third Parties - Schedu
Due from Third Parties - Schedule of Due from Third Parties (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Due from third parties | $ 3,860,377 | $ 1,196,918 |
Kind Therapeutics USA Inc. [Member] | ||
Due from third parties | 2,679,496 | 77,558 |
KPG of Anna LLC [Member] | ||
Due from third parties | 482,700 | 418,305 |
KPG of Harrisburg LLC [Member] | ||
Due from third parties | 449,385 | 382,260 |
Harvest Foundation LLC [Member] | ||
Due from third parties | 248,796 | 40,693 |
ARL Healthcare Inc. [Member] | ||
Due from third parties | 176,823 | |
Other [Member] | ||
Due from third parties | $ 101,279 |
Debentures Receivable (Details
Debentures Receivable (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Ownership percentage | 100.00% | ||
Interest income | $ 593,214 | $ 80,898 | |
GenCanna [Member] | |||
Ownership interest, percentage | 33.50% | 33.50% | |
GC Debentures [Member] | |||
Interest income | $ 502,000 | ||
GenCanna Global, Inc. [Member] | |||
Payments to acquire subordinated secured convertible debentures | $ 30,000,000 | ||
Debt interest rate | 9.00% | 9.00% | |
Description on debt instrument | The Company's option, (i) upon the occurrence of a Liquidity Event, as defined in the GC Debentures, or (ii) after December 31, 2018, upon ten days prior written notice to GenCanna. Conversion of the Company's entire $30 million investment shall equate to at least a 33.3% ownership interest in GenCanna on a fully diluted basis. The conversion price is equal to the lesser of a 20% discount to the price of the Liquidity Event, or the price based on a defined post-money valuation of GenCanna. If a Liquidity Event does not occur on or before June 30, 2020, the Company shall have the option to be redeemed in cash for the principal amount of the GC Debenture plus all accrued and unpaid interest thereon. | ||
Conversion debt to equity | $ 30,000,000 | ||
Ownership percentage | 33.00% | 33.00% | |
Percentage on conversion price | 20.00% | ||
GenCanna Global, Inc. [Member] | Subscription Agreement [Member] | |||
Accrued bonus | $ 10,000,000 | $ 10,000,000 |
Notes Receivable (Details Narra
Notes Receivable (Details Narrative) - USD ($) | 7 Months Ended | 12 Months Ended | ||
Apr. 30, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | May 31, 2016 | |
Note receivable long-term portion | $ 527,000 | $ 579,000 | ||
Note receivable | $ 1,092,376 | $ 578,831 | ||
Delaware Cannabis-licensee [Member] | ||||
Proceeds from notes receivable | $ 700,000 | |||
Debt interest rate | 12.50% | |||
Monthly payments | $ 10,100 | |||
Promissory note term | 10 years | |||
Two Unrelated Third Party Companies [Member] | Chooze Corp [Member] | ||||
Debt interest rate | 8.00% | |||
Ownership percentage | 2.70% | |||
Two Unrelated Third Party Companies [Member] | Chooze Corp [Member] | ||||
Proceeds from notes receivable | $ 550,000 | |||
Long term debt interest expense | $ 565,000 |
Notes Receivable - Schedule of
Notes Receivable - Schedule of Notes Receivable (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Total notes receivable | $ 1,143,839 | $ 624,167 |
Current portion of First State Compassion Center note receivable | 51,462 | 45,444 |
Notes receivable, long-term portion | 1,092,377 | 578,831 |
First State Compassion Center [Member] | ||
Total notes receivable | 578,723 | 624,275 |
The Healer [Member] | ||
Total notes receivable | 307,429 | |
Chooze Corp [Member] | ||
Total notes receivable | $ 257,687 |
Property and Equipment (Details
Property and Equipment (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Additions to property and equipment | $ 8,924,311 | $ 20,975,763 |
Construction in progress | 12,200,000 | 17,300,000 |
Depreciation and amortization | 658,000 | 363,000 |
Hagerstown, MD [Member] | ||
Construction in progress | 11,200,000 | 11,200,000 |
New Bedford, MA [Member] | ||
Construction in progress | 9,800,000 | 5,000,000 |
Middleborough, MA [Member] | ||
Construction in progress | $ 2,400,000 | $ 1,100,000 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Fixed Assets (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Property plant and equipment, gross | $ 36,259,694 | $ 27,453,809 |
Less: accumulated depreciation | (2,159,830) | (1,498,878) |
Property and equipment, net | 34,099,864 | 25,954,931 |
Land [Member] | ||
Property plant and equipment, gross | 3,392,710 | 3,392,710 |
Buildings and Building Improvements [Member] | ||
Property plant and equipment, gross | 13,566,144 | 3,918,359 |
Tenant Improvements [Member] | ||
Property plant and equipment, gross | 5,348,882 | 2,260,512 |
Furniture and Fixtures [Member] | ||
Property plant and equipment, gross | 114,160 | 95,815 |
Machinery and Equipment [Member] | ||
Property plant and equipment, gross | 1,632,351 | 506,464 |
Construction in Progress [Member] | ||
Property plant and equipment, gross | $ 12,205,447 | $ 17,279,949 |
Debt (Details Narrative)
Debt (Details Narrative) | 1 Months Ended | 12 Months Ended | |||||
Dec. 31, 2018USD ($)ft²$ / sharesshares | Sep. 30, 2018USD ($)$ / sharesshares | Nov. 30, 2017ft² | Aug. 31, 2017USD ($)shares | Dec. 31, 2018USD ($)ft²$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares | Dec. 31, 2016ft² | |
Mortgage agreement term | 10 years | ||||||
Area of land | ft² | 300,000 | 300,000 | |||||
Debt principal amount | $ 7,495,000 | $ 7,495,000 | $ 2,300,000 | ||||
Common stock, subscriptions | shares | 97,136 | 97,136 | 1,000,000 | ||||
Proceeds from issuance of promissory notes | $ 3,206,338 | $ 9,475,000 | |||||
Note discount recorded | $ 2,800,000 | 2,800,000 | |||||
Debt conversion of convertible debt | 1,904,316 | 2,763,069 | |||||
Repayment of notes | 7,000 | 0 | |||||
Proceeds from issuance of convertible debt | 2,000,000 | 2,785,841 | |||||
Accrued interest | $ 95,000 | $ 95,000 | $ 312,000 | ||||
Minimum [Member] | |||||||
Warrant exercise price | $ / shares | $ 0.20 | $ 0.20 | $ 0.40 | ||||
Maximum [Member] | |||||||
Warrant exercise price | $ / shares | $ 0.40 | $ 0.40 | $ 0.62 | ||||
Convertible Promissory Notes [Member] | |||||||
Interest rate | 10.00% | ||||||
Debt principal amount | $ 2,050,000 | ||||||
Promissory notes issued | $ 3,000,000 | ||||||
Debt conversion principal amount | $ 1,075,000 | $ 1,075,000 | |||||
Debt conversion of convertible shares | shares | 1,568,375 | 750,000 | 4,385,823 | ||||
Warrant term | 3 years | ||||||
Warrant exercise price | $ / shares | $ 1.80 | ||||||
Note discount recorded | $ 1,500,000 | ||||||
Value of warrant discount amortized | $ 882,000 | ||||||
Debt conversion of convertible debt | $ 829,000 | $ 451,000 | |||||
Accrued interest | $ 262,000 | ||||||
Convertible Promissory Notes [Member] | Minimum [Member] | |||||||
Interest rate | 4.50% | ||||||
Debt conversion price | $ / shares | $ 0.65 | $ 0.65 | |||||
Convertible Promissory Notes [Member] | Maximum [Member] | |||||||
Interest rate | 12.00% | ||||||
Debt conversion price | $ / shares | $ 0.90 | $ 0.90 | |||||
Promissory Note [Member] | |||||||
Debt conversion of convertible shares | shares | 2,596,313 | ||||||
Common stock, subscriptions | shares | 79,136 | 79,136 | |||||
Note discount recorded | $ 630,000 | $ 630,000 | |||||
Note carrying value | $ 2,370,000 | 2,370,000 | |||||
Debt conversion of convertible debt | $ 2,500,000 | ||||||
Convertible Promissory Notes One [Member] | |||||||
Debt conversion of convertible shares | shares | 1,000,000 | ||||||
Proceeds from issuance of promissory notes | $ 9,475,000 | ||||||
Promissory Notes [Member] | |||||||
Debt conversion of convertible shares | shares | 5,385,823 | ||||||
Massachusetts [Member ] | |||||||
Area of land | ft² | 10,000 | 10,000 | |||||
Delaware [Member ] | |||||||
Area of land | ft² | 45,000 | 45,000 | |||||
Mortgage Agreement [Member ] | |||||||
Debt principal amount | $ 4,900,000 | $ 4,900,000 | $ 2,900,000 | ||||
Mortgage Agreement [Member ] | DuQuoin State Bank [Member ] | |||||||
Area of land | ft² | 3,400 | ||||||
Debt principal amount | $ 850,000 | $ 850,000 | 869,000 | ||||
Mortgage Agreement [Member ] | November 2017 Through May 2019 [Member] | Prime Rate [Member] | |||||||
Interest rate | 2.00% | ||||||
Mortgage Agreement [Member ] | November 2017 Through May 2019 [Member] | Floor Rate [Member] | |||||||
Interest rate | 6.25% | ||||||
Mortgage Agreement [Member ] | May 2019 [Member] | Prime Rate [Member] | |||||||
Interest rate | 2.00% | ||||||
Mortgage Agreement [Member ] | May 2019 [Member] | Floor Rate [Member] | |||||||
Interest rate | 6.25% | ||||||
Mortgage Agreement [Member ] | May 2024 [Member] | Prime Rate [Member] | |||||||
Interest rate | 2.00% | ||||||
Mortgage Agreement [Member ] | May 2024 [Member] | Floor Rate [Member] | |||||||
Interest rate | 6.25% | ||||||
Mortgage Agreement [Member ] | ARL Healthcare Inc [Member] | |||||||
Area of land | ft² | 70,000 | ||||||
Mortgage Agreement [Member ] | Massachusetts [Member ] | |||||||
Area of land | ft² | 138,000 | ||||||
Mortgage Agreement [Member ] | Delaware [Member ] | |||||||
Area of land | ft² | 45,070 | 45,070 | |||||
Debt principal amount | $ 1,800,000 | $ 1,800,000 | $ 1,900,000 | ||||
Debt maturity description | The mortgage matures in 2031 | ||||||
Mortgage Agreement [Member ] | Delaware [Member ] | Prime Rate [Member] | |||||||
Interest rate | 1.50% | ||||||
Mortgage Agreement [Member ] | Delaware [Member ] | Floor Rate [Member] | |||||||
Interest rate | 5.25% | ||||||
Mortgage Agreement [Member ] | Delaware [Member ] | September 2021 [Member] | |||||||
Interest rate | 5.25% |
Debt - Schedule of Aggregate Ma
Debt - Schedule of Aggregate Maturities of Debt Outstanding (Details) | Dec. 31, 2018USD ($) |
Debt Disclosure [Abstract] | |
2019 | $ 5,154,404 |
2020 | 9,070,954 |
2021 | 235,827 |
2022 | 251,543 |
2023 | 268,338 |
Thereafter | 5,544,226 |
Total | 20,525,292 |
Less discounts | (5,553,339) |
Long-term debt, net | $ 14,971,953 |
Debentures Payable (Details Nar
Debentures Payable (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | |||
Dec. 31, 2018 | Nov. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Nov. 30, 2017 | |
Debt principal amount | $ 7,495,000 | $ 7,495,000 | $ 2,300,000 | ||
Accrued interest | 95,000 | 95,000 | 312,000 | ||
Debt conversion price | 1,904,316 | 2,763,069 | |||
Beneficial conversion feature, additional discount | 2,800,000 | 2,800,000 | |||
Proceeds from issuance of convertible debt | 2,000,000 | $ 2,785,841 | |||
Ownership percentage | 100.00% | ||||
10M Debentures Holder [Member] | |||||
Debt principal amount | 1,400,000 | $ 1,400,000 | 1,400,000 | ||
Accrued interest | $ 36,000 | $ 36,000 | 36,000 | ||
Debt conversion of convertible shares | 524,360 | 524,360 | |||
Amortization of the beneficial conversion feature | $ 1,500,000 | ||||
Amortization of the warrants discount | 91,000 | ||||
Amortization of original issue discount | $ 9,000 | ||||
Accrued unpaid interest | 9800000.00% | ||||
Interest expense | $ 36,000 | ||||
10M Debentures Holder [Member] | Beneficial Owner [Member] | |||||
Debt principal amount | 8,600,000 | 8,600,000 | |||
Accrued interest | 62,000 | 62,000 | |||
10M Debentures Holder [Member] | Minimum [Member] | |||||
Debt conversion price per share | $ 2.23 | $ 2.23 | |||
10M Debentures Holder [Member] | Maximum [Member] | |||||
Debt conversion price per share | $ 3.04 | $ 3.04 | |||
Convertible Debentures [Member] | 10M Debentures Holder [Member] | |||||
Debt principal amount | $ 10,000,000 | ||||
Debt conversion of convertible shares | 324,675 | ||||
Warrant term | 3 years | ||||
Debt conversion price | $ 10,000,000 | ||||
Intrinsic value of the beneficial conversion feature | 5,600,000 | ||||
Beneficial conversion feature, additional discount | $ 1,057,000 | ||||
Debt mature | 3 years | ||||
Debt instrument discount rate | 1.00% | ||||
Proceeds from issuance of convertible debt | $ 9,900,000 | ||||
Debt interest rate | 80.00% | ||||
Ownership percentage | 4.99% | ||||
Accrued unpaid interest | 10.00% | ||||
Debt redemption percentage | 110.00% | ||||
Convertible Debentures [Member] | 10M Debentures Holder [Member] | Securities Purchase Agreement [Member] | |||||
Debt conversion of convertible shares | 500,000,000 | ||||
Convertible Debentures [Member] | 10M Debentures Holder [Member] | Minimum [Member] | |||||
Debt conversion price per share | $ 3.50 | ||||
Convertible Debentures [Member] | 10M Debentures Holder [Member] | Maximum [Member] | |||||
Debt conversion price per share | $ 5.50 | ||||
10M Debentures [Member] | |||||
Unamortized balances of the beneficial conversion feature | 4,100,000 | 4,100,000 | |||
Unamortized balance of warrants discount | 966,000 | 966,000 | |||
Unamortized balance of original issue discount | 91,000 | 91,000 | |||
Debentures carrying value | $ 3,600,000 | $ 3,600,000 |
Equity (Details Narrative)
Equity (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | ||||||||||||
Dec. 31, 2018 | Nov. 30, 2018 | Sep. 30, 2018 | Aug. 31, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Dec. 31, 2017 | Oct. 31, 2017 | Aug. 31, 2017 | Jun. 30, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Nov. 30, 2017 | Jan. 31, 2017 | |
Preferred stock, shares authorized | 50,000,000 | 50,000,000 | 50,000,000 | 50,000,000 | ||||||||||
Loss on conversion | $ 4,133,481 | $ 872,133 | ||||||||||||
Common stock, shares authorized | 500,000,000 | 500,000,000 | 500,000,000 | 500,000,000 | ||||||||||
Number of shares issued during period, value | $ 31,821,001 | $ 6,578,000 | ||||||||||||
Number of common stock issued related to acquisition | 75,000,000 | |||||||||||||
Common stock, acquisition percentage | 49.00% | |||||||||||||
Promissory notes | $ 7,495,000 | $ 2,300,000 | 7,495,000 | $ 2,300,000 | ||||||||||
Ownership percentage | 100.00% | 100.00% | ||||||||||||
Accrued interest | $ 95,000 | $ 312,000 | $ 95,000 | $ 312,000 | ||||||||||
Common stock, subscriptions | 97,136 | 1,000,000 | 97,136 | 1,000,000 | ||||||||||
Number of warrants issued to purchase common stock | 8,661,137 | 120,311 | 8,661,137 | 120,311 | ||||||||||
Fair value of warrant market value | $ 15,700,000 | $ 1,000,000 | ||||||||||||
Convertible Promissory Notes [Member] | ||||||||||||||
Debt converted into common shares | 1,568,375 | 750,000 | 4,385,823 | |||||||||||
Promissory notes | $ 2,050,000 | |||||||||||||
Debt conversion principal amount | $ 1,075,000 | $ 1,075,000 | ||||||||||||
Accrued interest | $ 262,000 | |||||||||||||
Promissory Note [Member] | ||||||||||||||
Debt converted into common shares | 2,596,313 | |||||||||||||
Common stock, subscriptions | 79,136 | 79,136 | ||||||||||||
Promissory Notes [Member] | ||||||||||||||
Debt converted into common shares | 5,385,823 | |||||||||||||
Sprout [Member] | ||||||||||||||
Number of common stock issued during period | 378,259 | |||||||||||||
Number of shares issued during period, value | $ 915,000 | |||||||||||||
iRollie LLC [Member] | ||||||||||||||
Number of common stock issued related to acquisition | 264,317 | |||||||||||||
Ownership percentage | 100.00% | |||||||||||||
Third Parties [Member] | ||||||||||||||
Loss on conversion | $ 1,024,000 | $ 31,000 | ||||||||||||
Shares in exchange for services | 3,420,526 | 1,007,597 | ||||||||||||
10M Debentures Holder [Member] | ||||||||||||||
Debt converted into common shares | 524,360 | 524,360 | ||||||||||||
Promissory notes | $ 1,400,000 | $ 1,400,000 | $ 1,400,000 | |||||||||||
Accrued interest | 36,000 | $ 36,000 | $ 36,000 | |||||||||||
10M Debentures Holder [Member] | Convertible Debentures [Member] | ||||||||||||||
Debt converted into common shares | 324,675 | |||||||||||||
Promissory notes | $ 10,000,000 | |||||||||||||
Ownership percentage | 4.99% | |||||||||||||
Common Stock [Member] | ||||||||||||||
Number of common stock issued during period | 2,430,768 | |||||||||||||
Debt converted into common shares | 1,568,375 | |||||||||||||
Common Stock [Member] | ||||||||||||||
Number of common stock issued during period | 19,188,980 | 26,672,228 | ||||||||||||
Debt converted into common shares | 1,568,375 | 4,385,823 | ||||||||||||
Number of shares issued during period, value | $ 19,189 | $ 26,671 | ||||||||||||
Shares in exchange for services | 3,420,526 | |||||||||||||
Purchase exercised options | 654,602 | 4,710,000 | ||||||||||||
Class A Membership Units [Member] | Mari Holdings MD LLC [Member] | ||||||||||||||
Number of common stock issued during period | 12,778 | 12,778 | ||||||||||||
Number of shares issued during period, value | $ 1,150,000 | $ 1,150,000 | ||||||||||||
Ownership percentage | 3.05% | 3.05% | ||||||||||||
Subsidiary [Member] | Mari Holdings MD LLC [Member] | ||||||||||||||
Exchange of membership percentage for shares | 0.50% | |||||||||||||
Number of shares received for exchange on membership interest | 222,222 | |||||||||||||
Membership Interests [Member] | Mari Holdings MD LLC [Member] | ||||||||||||||
Subscriptions receivable | $ 25,000 | $ 25,000 | ||||||||||||
Options Two [Member] | ||||||||||||||
Options to purchase shares of common stock | 760,000 | 800,000 | ||||||||||||
Purchase exercised options | 460,000 | 4,500,000 | ||||||||||||
Options One [Member] | ||||||||||||||
Options to purchase shares of common stock | 300,000 | 550,000 | ||||||||||||
Warrant [Member] | ||||||||||||||
Number of warrants issued to purchase common stock | 2,300,237 | 2,300,237 | ||||||||||||
Series A Preferred Stock [Member] | ||||||||||||||
Number of common stock issued during period | 200,000 | |||||||||||||
Share issued price | $ 1 | $ 1 | ||||||||||||
Preferred stock dividend, rate | 6.00% | |||||||||||||
Series A convertible Preferred [Member] | ||||||||||||||
Preferred stock, shares authorized | 500,000 | |||||||||||||
Discount to selling price, percentage | 25.00% | |||||||||||||
Market capitalization | $ 50,000,000 | $ 50,000,000 | ||||||||||||
Debt converted into common shares | 970,989 | |||||||||||||
Debt instrument conversion price | $ 0.55 | |||||||||||||
Loss on conversion | $ 34,000 | |||||||||||||
Subscribed Common Stock [Member] | ||||||||||||||
Subscription outstanding, shares | 79,136 | 79,136 | ||||||||||||
Subscription outstanding, value | $ 95,000 | $ 95,000 | ||||||||||||
Promissory notes | $ 50,000 | 50,000 | ||||||||||||
Accrued interest | $ 1,454 | |||||||||||||
Subscribed Common Stock [Member] | Betty's Eddies [Member] | ||||||||||||||
Number of common stock issued during period | 1,000,000 | |||||||||||||
Number of shares issued during period, value | $ 370,000 | |||||||||||||
Shares in exchange for services | 370,000 | |||||||||||||
Subscribed Common Stock [Member] | September 2018 through January 2019 [Member] | ||||||||||||||
Subscription outstanding, shares | 18,000 | 18,000 | ||||||||||||
Subscription outstanding, value | $ 74,160 | $ 74,160 | ||||||||||||
Minimum [Member] | ||||||||||||||
Preferred stock, shares authorized | 5,000,000 | |||||||||||||
Share issued price | $ 0.50 | 0.18 | $ 0.50 | $ 0.18 | ||||||||||
Common stock, shares authorized | 100,000,000 | |||||||||||||
Minimum [Member] | Convertible Promissory Notes [Member] | ||||||||||||||
Debt instrument conversion price | 0.65 | 0.65 | ||||||||||||
Minimum [Member] | 10M Debentures Holder [Member] | ||||||||||||||
Debt instrument conversion price | $ 2.23 | $ 2.23 | ||||||||||||
Minimum [Member] | 10M Debentures Holder [Member] | Convertible Debentures [Member] | ||||||||||||||
Debt instrument conversion price | 3.50 | |||||||||||||
Maximum [Member] | ||||||||||||||
Preferred stock, shares authorized | 50,000,000 | |||||||||||||
Share issued price | 0.65 | $ 0.50 | 0.65 | $ 0.50 | ||||||||||
Common stock, shares authorized | 500,000,000 | |||||||||||||
Maximum [Member] | Convertible Promissory Notes [Member] | ||||||||||||||
Debt instrument conversion price | $ 0.90 | $ 0.90 | ||||||||||||
Maximum [Member] | 10M Debentures Holder [Member] | ||||||||||||||
Debt instrument conversion price | 3.04 | $ 3.04 | ||||||||||||
Maximum [Member] | 10M Debentures Holder [Member] | Convertible Debentures [Member] | ||||||||||||||
Debt instrument conversion price | $ 5.50 |
Stock Options (Details Narrativ
Stock Options (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Non-cash equity compensation | $ 5,760,617 | $ 1,078,253 |
Treasury stock, surrendered | 352,926 | 90,000 |
Options One [Member] | ||
Options to purchase shares of common stock | 300,000 | 550,000 |
Stock options expiration period, description | expiring between December 2020 and November 2024 | expiring between September 2020 and October 2021 |
Option to share issued | 4,720,000 | |
Option to share vested | 3,150,000 | |
Option to share issuance | 1,570,000 | |
Non-cash equity compensation | $ 3,900,000 | $ 74,000 |
Stock options vesting period, description | Vesting periods that span six to thirty months | Vesting from the grant date through March 2019 |
Options One [Member] | December 2020 [Member] | ||
Non-cash equity compensation | $ 5,900,000 | |
Options One [Member] | March 2019 [Member] | ||
Non-cash equity compensation | $ 58,000 | $ 159,000 |
Number of stock options shares forfeited | 27,000 | |
Options One [Member] | Minimum [Member] | ||
Exercise price of common stock | $ 0.14 | $ 0.26 |
Options One [Member] | Maximum [Member] | ||
Exercise price of common stock | $ 3.73 | $ 0.55 |
Options Two [Member] | ||
Options to purchase shares of common stock | 760,000 | 800,000 |
Purchase exercised options | 460,000 | 4,500,000 |
Payments to surrender of common stock | $ 105,398 | $ 90,000 |
Options Two [Member] | Minimum [Member] | ||
Exercise price of common stock | $ 0.08 | $ 0.01 |
Options Two [Member] | Maximum [Member] | ||
Exercise price of common stock | $ 0.63 | $ 0.03 |
Stock Options - Schedule of Sto
Stock Options - Schedule of Stock Options Transactions (Details) - Stock Option [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Number of stock options outstanding, balance | 4,800,000 | 9,250,000 |
Number of stock options, Granted | 4,720,000 | 550,000 |
Number of stock options, Exercised | (760,000) | (4,800,000) |
Number of stock options, Forfeited/Expired | (450,000) | (200,000) |
Number of stock options outstanding, balance | 8,310,000 | 4,800,000 |
Weighted-Average Exercise Price, Balance | $ 0.100 | |
Weighted-Average Exercise Price, Granted | $ 1.805 | 0.458 |
Weighted-Average Exercise Price, Exercised | 0.216 | 0.011 |
Weighted-Average Exercise Price, Forfeited/Expired | 0.433 | $ 0.025 |
Weighted-Average Exercise Price, Balance | $ 1.117 |
Stock Options - Schedule of S_2
Stock Options - Schedule of Stock Options Outstanding and Exercisable (Details) | 12 Months Ended |
Dec. 31, 2018$ / sharesshares | |
Outstanding shares under option | 8,310,000 |
Exercisable shares under option | 7,425,000 |
Range One [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.08 |
Outstanding shares under option | 250,000 |
Exercisable shares under option | 250,000 |
Outstanding remaining life in years | 29 days |
Range Two [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.08 |
Outstanding shares under option | 100,000 |
Exercisable shares under option | 100,000 |
Outstanding remaining life in years | 11 months 19 days |
Range Three [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.13 |
Outstanding shares under option | 200,000 |
Exercisable shares under option | 200,000 |
Outstanding remaining life in years | 1 year 6 months |
Range Four [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.14 |
Outstanding shares under option | 650,000 |
Exercisable shares under option | 650,000 |
Outstanding remaining life in years | 2 years |
Range Five [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.15 |
Outstanding shares under option | 1,000,000 |
Exercisable shares under option | 1,000,000 |
Outstanding remaining life in years | 8 months 26 days |
Range Six [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.25 |
Outstanding shares under option | 1,000,000 |
Exercisable shares under option | 1,000,000 |
Outstanding remaining life in years | 8 months 26 days |
Range Seven [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.26 |
Outstanding shares under option | 50,000 |
Exercisable shares under option | 50,000 |
Outstanding remaining life in years | 2 years 2 months 30 days |
Range Eight [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.33 |
Outstanding shares under option | 50,000 |
Exercisable shares under option | 50,000 |
Outstanding remaining life in years | 2 years 2 months 8 days |
Range Nine [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.35 |
Outstanding shares under option | 1,000,000 |
Exercisable shares under option | 1,000,000 |
Outstanding remaining life in years | 8 months 26 days |
Range Ten [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.45 |
Outstanding shares under option | 190,000 |
Exercisable shares under option | 190,000 |
Outstanding remaining life in years | 2 years 9 months 3 days |
Range Eleven [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.55 |
Outstanding shares under option | 100,000 |
Exercisable shares under option | 100,000 |
Outstanding remaining life in years | 1 year 8 months 26 days |
Range Twelve [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.55 |
Outstanding shares under option | 100,000 |
Exercisable shares under option | 100,000 |
Outstanding remaining life in years | 1 year 8 months 26 days |
Range Thirteen [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.55 |
Outstanding shares under option | 20,000 |
Exercisable shares under option | 20,000 |
Outstanding remaining life in years | 2 years 7 days |
Range Forteen [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.63 |
Outstanding shares under option | 300,000 |
Exercisable shares under option | 300,000 |
Outstanding remaining life in years | 3 years |
Range Fifteen [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.77 |
Outstanding shares under option | 300,000 |
Exercisable shares under option | 300,000 |
Outstanding remaining life in years | 4 years |
Range Sixteen [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.90 |
Outstanding shares under option | 50,000 |
Exercisable shares under option | 50,000 |
Outstanding remaining life in years | 4 years 4 months 13 days |
Range Seventeen [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.95 |
Outstanding shares under option | 50,000 |
Exercisable shares under option | 10,000 |
Outstanding remaining life in years | 4 years |
Range Eighteen [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 2.32 |
Outstanding shares under option | 300,000 |
Exercisable shares under option | |
Outstanding remaining life in years | 4 years 8 months 12 days |
Range Ninteen [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 2.45 |
Outstanding shares under option | 2,000,000 |
Exercisable shares under option | 2,000,000 |
Outstanding remaining life in years | 5 years 10 months 6 days |
Range Twenty [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 2.50 |
Outstanding shares under option | 100,000 |
Exercisable shares under option | |
Outstanding remaining life in years | 4 years 7 months 28 days |
Range Twenty One [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 2.65 |
Outstanding shares under option | 200,000 |
Exercisable shares under option | |
Outstanding remaining life in years | 4 years 8 months 23 days |
Range Twenty Two [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 2.85 |
Outstanding shares under option | 75,000 |
Exercisable shares under option | |
Outstanding remaining life in years | 3 years 11 months 12 days |
Range Twenty Three [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 2.85 |
Outstanding shares under option | 100,000 |
Exercisable shares under option | |
Outstanding remaining life in years | 4 years 11 months 12 days |
Range Twenty Four [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 3 |
Outstanding shares under option | 25,000 |
Exercisable shares under option | |
Outstanding remaining life in years | 4 years 11 months 15 days |
Range Twenty Five [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 3.73 |
Outstanding shares under option | 200,000 |
Exercisable shares under option | |
Outstanding remaining life in years | 4 years 11 months 8 days |
Warrants (Details Narrative)
Warrants (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Number of warrants issued to purchase common stock | 8,661,137 | 120,311 |
Warrant expiration description | warrants generally expire three or five years from issuance date. | |
Fair value of warrant market value | $ 15,700,000 | $ 1,000,000 |
Compensation expense | 1,800,000 | |
Debt discounts | 2,800,000 | |
Equity discounts | $ 11,100,000 | |
Treasury stock, surrendered | 352,926 | 90,000 |
Warrant [Member] | ||
Number of warrants issued to purchase common stock | 2,300,237 | |
Warrants exercise price | $ 0.65 | |
Number of warrants exercised | 1,000,000 | |
Payment to surrender warrants | $ 157,527 | |
Treasury stock, surrendered | 500,000 | 0 |
Minimum [Member] | ||
Warrants exercise price | $ 0.20 | $ 0.40 |
Minimum [Member] | Warrant [Member] | ||
Warrants exercise price | 0.10 | |
Maximum [Member] | ||
Warrants exercise price | 0.40 | $ 0.62 |
Maximum [Member] | Warrant [Member] | ||
Warrants exercise price | $ 1.75 |
Warrants - Summary of Warrant T
Warrants - Summary of Warrant Transactions (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Warrants | ||
Number of Stock Options Outstanding, beginning balance | 4,245,311 | 1,125,000 |
Number of Stock Options, Granted | 8,661,137 | 3,120,311 |
Number of Stock Options, Exercised | (2,300,237) | |
Number of Stock Options, Forfeited/Expired | ||
Number of Stock Options Outstanding, ending balance | 10,606,211 | 4,245,311 |
Weighted-Average Exercise Price, Outstanding, beginning balance | $ 0.38 | $ 0.136 |
Weighted-Average Exercise Price, Granted | 2.548 | 0.468 |
Weighted-Average Exercise Price, Exercised | 0.385 | |
Weighted-Average Exercise Price, Forfeited/Expired | ||
Weighted-Average Exercise Price, Outstanding, ending balance | $ 2.149 | $ 0.38 |
Revenues (Details Narrative)
Revenues (Details Narrative) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Sales Revenue [Member] | Customer Concentration Risk [Member] | ||
Concentration risk, percentage | 73.00% | 81.00% |
Revenues - Schedule of Revenues
Revenues - Schedule of Revenues Comprised of Major Categories (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Total revenues | $ 11,851,915 | $ 6,067,853 |
Real Estate [Member] | ||
Total revenues | 5,798,996 | 2,517,225 |
Management [Member] | ||
Total revenues | 1,581,548 | 1,193,854 |
Supply Procurement [Member] | ||
Total revenues | 3,657,909 | 1,936,686 |
Licensing [Member] | ||
Total revenues | 700,173 | 269,256 |
Consulting [Member] | ||
Total revenues | 50,000 | 150,604 |
Other [Member] | ||
Total revenues | $ 63,289 | $ 228 |
Non-Operating Income (Details N
Non-Operating Income (Details Narrative) | 1 Months Ended |
Jul. 31, 2017USD ($) | |
Revenue Recognition and Deferred Revenue [Abstract] | |
Deferred revenue written off | $ 227,000 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Net operating loss carry forwards | $ 3,121,086 | $ 2,826,698 |
Federal corporate tax rate | 21.00% | 34.00% |
Provisional amount for the one-time transition tax liability | $ 36 | |
Increase in income tax provision | $ 36 | |
Percentage of taxable income subject to annual limitation of federal net operating loss carryforward | 80.00% | |
Uncertain tax positions | ||
Accrued interest or penalties related to uncertain tax positions | ||
One-time Transition Tax Liability [Member] | ||
Increase in income tax provision | $ 16 |
Income Taxes - Schedule of Reco
Income Taxes - Schedule of Reconciliation of Income Taxes (Details) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | ||
U.S Federal taxes at the statutory rate | 21.00% | 34.00% |
State taxes net of federal benefit | 6.00% | 5.00% |
Valuation allowance | (27.00%) | (39.00%) |
Total deferred tax asset | 0.00% | 0.00% |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Asset (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Income Tax Disclosure [Abstract] | ||
Net operating loss carryforwards | $ 3,121,086 | $ 2,826,698 |
Fixed assets | (952,875) | (10,918) |
Deferred tax asset | 2,168,210 | 2,815,780 |
Valuation allowance | (2,168,210) | (2,815,780) |
Net deferred tax asset |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | |||||
Aug. 31, 2018 | Jan. 31, 2018 | Sep. 30, 2017 | Jun. 30, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 02, 2018 | |
Ownership percentage | 100.00% | ||||||
Non-cash equity compensation | $ 5,760,617 | $ 1,078,253 | |||||
Lease term | 10 years | ||||||
Expenses incurred under the leases | 78,000 | 24,000 | |||||
Due to related parties | 276,000 | 401,000 | |||||
Due from related parties | $ 120,000 | $ 135,000 | |||||
Minimum [Member] | |||||||
Common stock exercise price | $ 0.50 | $ 0.18 | |||||
Maximum [Member] | |||||||
Common stock exercise price | $ 0.65 | $ 0.50 | |||||
CEO [Member] | |||||||
Purchase exercised options | 1,450,000 | 4,500,000 | 400,000 | 400,000 | |||
Common stock exercise price | $ 0.01 | $ 0.025 | |||||
Aggregate value of common stock | $ 45,000 | ||||||
Payment of surrender of common stock | $ 90,000 | ||||||
Common stock shares forfeited | 200,000 | 200,000 | |||||
Stock options expiration period, description | expiring between December 2020 and December 2022. | ||||||
Non-cash equity compensation | $ 458,000 | ||||||
CEO [Member] | Minimum [Member] | |||||||
Common stock exercise price | $ 0.14 | ||||||
CEO [Member] | Maximum [Member] | |||||||
Common stock exercise price | $ 0.77 | ||||||
Chief Financial Officer [Member] | |||||||
Common stock exercise price | $ 0.025 | ||||||
CEO and CFO [Member] | |||||||
Due to related parties | $ 81,000 | $ 33,000 | |||||
Due from related parties | 120,000 | ||||||
Two Shareholders [Member] | |||||||
Due to related parties | 60,000 | 215,000 | |||||
MariMed Advisors Inc. [Member] | |||||||
Ownership percentage | 49.00% | ||||||
Common stock shares acquired | 75,000,000 | ||||||
Two Companies [Member] | CEO and CFO [Member] | |||||||
Due to related parties | $ 135,000 | $ 153,000 |
Commitments and Contingencies_2
Commitments and Contingencies (Details Narrative) | 1 Months Ended | 12 Months Ended | ||
Aug. 31, 2018 | Oct. 31, 2016ft² | Dec. 31, 2018USD ($)ft² | Dec. 31, 2017USD ($) | |
Area of land | 300,000 | |||
Lease term | 10 years | |||
Agreement term description | An employment agreement with the former CEO of the Company that provided this individual with salary, car allowances, stock options, life insurance, and other employee benefits, was terminated in 2017. | |||
Accrued expenses | $ | $ 1,588,368 | $ 1,405,336 | ||
Employment Agreement [Member] | ||||
Accrued expenses | $ | $ 1,043,000 | $ 1,043,000 | ||
Delaware [Member ] | ||||
Area of land | 45,000 | |||
Lease expiration, description | Lease expiring in 2035 | |||
Delaware [Member ] | March 2019 [Member ] | ||||
Area of land | 100,000 | |||
Lease term | 10 years | |||
Delaware [Member ] | Operating Lease Commitments [Member ] | ||||
Area of land | 4,000 | |||
Lease term | 5 years | |||
NEVADA [Member ] | ||||
Area of land | 10,000 | |||
Lease term | 10 years | |||
Lease expiration, description | Expiring in 2024 | |||
MASSACHUSETTS [Member ] | ||||
Area of land | 10,000 | |||
Lease term | 10 years | |||
Lease expiration, description | Expiring in 2028 which contain a 5-year extension option. | |||
MARYLAND [Member ] | ||||
Area of land | 180,000 | |||
MARYLAND [Member ] | Operating Lease Commitments [Member ] | ||||
Area of land | 2,700 | |||
Lease expiration, description | Expires in July 2020 with an option to renew for a two-year term |
Commitments and Contingencies -
Commitments and Contingencies - Schedule of Future Minimum Lease Payments Under All Non-cancelable Operating Leases (Details) | Dec. 31, 2018USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2019 | $ 398,731 |
2020 | 797,120 |
2021 | 894,450 |
2022 | 882,068 |
2023 | 858,136 |
Thereafter | 4,547,028 |
Total | $ 8,377,533 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) | 1 Months Ended | 12 Months Ended | |||||
Mar. 31, 2019USD ($)ft² | Feb. 28, 2019USD ($)$ / sharesshares | Jan. 31, 2019USD ($) | Dec. 31, 2018USD ($)$ / shares | Aug. 31, 2018 | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares | |
Ownership percentage | 100.00% | ||||||
Lease term | 10 years | ||||||
Proceeds from issuance of promissory note | $ 3,206,338 | $ 9,475,000 | |||||
Number of common stock shares issued, values | 31,821,001 | 6,578,000 | |||||
Proceeds from warrant exercises | 385,395 | ||||||
Proceeds from issuance of common stock | 31,821,001 | 6,585,800 | |||||
Principal amount | $ 7,495,000 | 7,495,000 | 2,300,000 | ||||
Accrued interest | $ 95,000 | $ 95,000 | $ 312,000 | ||||
Options One [Member] | |||||||
Options to purchase shares of common stock | shares | 300,000 | 550,000 | |||||
Subscriptions Receivable [Member] | |||||||
Number of common stock shares issued | shares | 97,136 | ||||||
Minimum [Member] | |||||||
Common stock price per share | $ / shares | $ 0.50 | $ 0.50 | $ 0.18 | ||||
Warrant exercise price per share | $ / shares | 0.20 | 0.20 | 0.40 | ||||
Maximum [Member] | |||||||
Common stock price per share | $ / shares | 0.65 | 0.65 | 0.50 | ||||
Warrant exercise price per share | $ / shares | $ 0.40 | $ 0.40 | $ 0.62 | ||||
Subsequent Event [Member] | |||||||
Proceeds from issuance of promissory note | $ 6,000,000 | ||||||
Promissory note interest rate | 10.00% | ||||||
Debt maturity date | Jan. 31, 2020 | ||||||
Number of common stock shares issued | shares | 799,995 | ||||||
Common stock price per share | $ / shares | $ 3.25 | ||||||
Number of common stock shares issued, values | $ 2,600,000 | ||||||
Warrant to purchase shares of common stock | shares | 22,000 | ||||||
Proceeds from warrant exercises | $ 15,800 | ||||||
Conversion of debentures, value | 10,000,000 | ||||||
Principal amount | 600,000 | ||||||
Accrued interest | $ 97,000 | ||||||
Conversion of debentures into shares | shares | 233,194 | ||||||
Subsequent Event [Member] | Options [Member] | |||||||
Common stock price per share | $ / shares | $ 0.26 | ||||||
Options to purchase shares of common stock | shares | 50,000 | ||||||
Proceeds from issuance of common stock | $ 13,000 | ||||||
Subsequent Event [Member] | Options One [Member] | |||||||
Options to purchase shares of common stock | shares | 350,000 | ||||||
Number of common stock paid via surrender | shares | 139,985 | ||||||
Subsequent Event [Member] | Minimum [Member] | |||||||
Warrant exercise price per share | $ / shares | $ 0.50 | ||||||
Debt conversion price per share | $ / shares | 2.90 | ||||||
Subsequent Event [Member] | Maximum [Member] | |||||||
Warrant exercise price per share | $ / shares | 0.40 | ||||||
Debt conversion price per share | $ / shares | $ 3.06 | ||||||
Subsequent Event [Member] | Maryland Health & Wellness Center Inc [Member] | |||||||
Ownership percentage | 20.00% | ||||||
Construction loan | $ 300,000 | ||||||
Loan interest rate | 8.00% | ||||||
Subsequent Event [Member] | Chooze Corp [Member] | |||||||
Note receivable | $ 258,000 | ||||||
Ownership percentage | 2.70% | ||||||
Subsequent Event [Member] | Real Estate [Member] | |||||||
Number of square foot | ft² | 100,000 | ||||||
Lease term | 10 years | ||||||
Subsequent Event [Member] | Real Estate [Member] | Cultivation and Processing Facility [Member] | |||||||
Number of square foot | ft² | 60,000 | ||||||
GenCanna Global, Inc. [Member] | |||||||
Payments to acquire subordinated secured convertible debentures | $ 30,000,000 | ||||||
Ownership percentage | 33.00% | 33.00% | |||||
Promissory note interest rate | 9.00% | 9.00% | |||||
GenCanna Global, Inc. [Member] | Subsequent Event [Member] | |||||||
Payments to acquire subordinated secured convertible debentures | $ 30,000,000 | ||||||
Ownership percentage | 33.50% | ||||||
Meditaurus LLC [Member] | Subsequent Event [Member] | |||||||
Ownership percentage | 70.00% | ||||||
Maryland Health & Wellness Center Inc [Member] | Subsequent Event [Member] | |||||||
Line of credit maturity date | Jan. 31, 2023 |