Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Sep. 30, 2021 | Nov. 15, 2021 | |
Document Information Line Items | ||
Entity Registrant Name | GENERATION HEMP, INC. | |
Trading Symbol | GENH | |
Document Type | 10-Q | |
Current Fiscal Year End Date | --12-31 | |
Entity Common Stock, Shares Outstanding | 111,486,996 | |
Amendment Flag | false | |
Entity Central Index Key | 0001527102 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Document Period End Date | Sep. 30, 2021 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q3 | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 000-55019 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 26-3119496 | |
Entity Address, Address Line One | 8533 Midway Road | |
Entity Address, City or Town | Dallas | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 75209 | |
City Area Code | (469) | |
Local Phone Number | 209-6154 | |
Title of 12(b) Security | Common Stock, no par value | |
Security Exchange Name | NYSE | |
Entity Interactive Data Current | Yes |
Unaudited Condensed Consolidate
Unaudited Condensed Consolidated Balance Sheets - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Current Assets | ||
Cash | $ 134,165 | $ 2,776,425 |
Accounts receivable | 127,665 | |
Prepaid expenses | 14,232 | |
Total Current Assets | 276,062 | 2,776,425 |
Property and Equipment | ||
Property and equipment | 3,012,316 | 1,222,430 |
Accumulated depreciation | (417,135) | (102,938) |
Total Property and Equipment, Net | 2,595,181 | 1,119,492 |
Operating lease right-of-use asset | 286,839 | |
Intangible assets, net | 2,474,136 | |
Goodwill | 509,701 | |
Other assets | 407,000 | 23,077 |
Total Assets | 6,548,919 | 3,918,994 |
Current Liabilities | ||
Accounts payable | 1,061,873 | 1,053,542 |
Accrued liabilities | 375,521 | 337,588 |
Payables to related parties | 167,482 | 448,271 |
Operating lease liability - related party | 98,749 | |
Notes payable – related parties | 2,360,000 | 3,336,592 |
Other indebtedness - current | 516,359 | 619,461 |
Common stock issuable | 50,000 | |
Current liabilities of discontinued operations held for sale | 137,068 | 140,068 |
Total Current Liabilities | 4,717,052 | 5,985,522 |
Operating lease liability - related party, net of current portion | 188,090 | |
Other indebtedness - long-term | 25,200 | |
Long-term liabilities of discontinued operations held for sale | 158,498 | 144,149 |
Total Liabilities | 5,063,640 | 6,154,871 |
Commitments and Contingencies | ||
Series B redeemable preferred stock, no par value, $10,000 stated value, 300 shares authorized, 118 and 135 shares issued and outstanding at September 30, 2021 and December 31, 2020 | 591,558 | 729,058 |
Equity (Deficit) | ||
Series A preferred stock, $0.00001 par value; $1.00 stated value; 6,500,000 shares authorized, none and 6,328,948 shares issued and outstanding at September 30, 2021 and December 31, 2020 | 4,975,503 | |
Common stock, $0.00001 par value; 200,000,000 shares authorized, 111,070,329 shares issued and outstanding at September 30, 2021 | 1,111 | |
Common stock, no par value; 100,000,000 shares authorized, 17,380,317 shares issued and outstanding at December 31, 2020 | 6,083,480 | |
Additional paid-in capital | 23,776,409 | 4,436,018 |
Accumulated deficit | (22,644,284) | (18,220,705) |
Generation Hemp equity | 1,133,236 | (2,725,704) |
Noncontrolling interest | (239,515) | (239,231) |
Total Equity (Deficit) | 893,721 | (2,964,935) |
Total Liabilities and Equity (Deficit) | $ 6,548,919 | $ 3,918,994 |
Unaudited Condensed Consolida_2
Unaudited Condensed Consolidated Balance Sheets (Parentheticals) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Common stock, par value (in Dollars per share) | $ 0.00001 | |
Common stock, shares authorized | 200,000,000 | 100,000,000 |
Common stock, shares issued | 111,070,329 | 17,380,317 |
Common stock, shares outstanding | 111,070,329 | 17,380,317 |
Series B Redeemable Preferred Stock | ||
Preferred stock par value (in Dollars per share) | ||
Preferred stock, Stated Value (in Dollars) | $ 10,000 | $ 10,000 |
Preferred stock, shares authorized | 300 | 300 |
Preferred stock, shares issued | 118 | 135 |
Preferred stock, shares outstanding | 118 | 135 |
Series A Preferred Stock | ||
Preferred stock par value (in Dollars per share) | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized | 6,500,000 | 6,500,000 |
Preferred stock, shares issued | 6,328,948 | |
Preferred stock, shares outstanding | 6,328,948 | |
Preferred stock, stated value (in Dollars per share) | $ 1 | $ 1 |
Unaudited Condensed Consolida_3
Unaudited Condensed Consolidated Statements of Operations - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Revenue | ||||
Post-harvest and midstream services | $ 487,088 | $ 535,053 | ||
Rental | 15,000 | 22,500 | 60,000 | $ 67,500 |
Total revenue | 502,088 | 22,500 | 595,053 | 67,500 |
Costs and Expenses | ||||
Cost of revenue (exclusive of items shown separately below) | 279,621 | 549,881 | ||
Depreciation and amortization | 315,729 | 16,038 | 1,006,804 | 54,961 |
Merger and acquisition costs | 6,856 | 16,115 | 99,880 | |
General and administrative | 1,128,298 | 108,728 | 2,763,529 | 883,565 |
Total costs and expenses | 1,723,648 | 131,622 | 4,336,329 | 1,038,406 |
Operating loss | (1,221,560) | (109,122) | (3,741,276) | (970,906) |
Other expense (income) | ||||
Interest and other income | (25,424) | (1) | ||
Change in fair value of marketable security | (1,826) | (11,770) | 14,736 | |
Interest expense | 155,505 | 68,475 | 651,807 | 204,875 |
Total other expense | 155,505 | 66,649 | 614,613 | 219,610 |
Loss from continuing operations | (1,377,065) | (175,771) | (4,355,889) | (1,190,516) |
Loss from discontinued operations | (1,630) | (7,989) | (11,349) | (5,457) |
Net loss | (1,378,695) | (183,760) | (4,367,238) | (1,195,973) |
Less: net loss attributable to noncontrolling interests | (1,137) | (4,904) | (284) | (44,266) |
Net loss attributable to Generation Hemp | $ (1,377,558) | $ (178,856) | $ (4,366,954) | $ (1,151,707) |
Loss from continuing operations | ||||
Basic (in Dollars per share) | $ (0.03) | $ (0.01) | $ (0.11) | $ (0.07) |
Diluted (in Dollars per share) | (0.03) | (0.01) | (0.11) | (0.07) |
Loss from discontinued operations | ||||
Basic (in Dollars per share) | ||||
Diluted (in Dollars per share) | ||||
Earnings (loss) per share | ||||
Basic (in Dollars per share) | (0.03) | (0.01) | (0.11) | (0.07) |
Diluted (in Dollars per share) | $ (0.03) | $ (0.01) | $ (0.11) | $ (0.07) |
Unaudited Condensed Consolida_4
Unaudited Condensed Consolidated Statements of Equity - USD ($) | Total | Series B Redeemable Preferred Stock | Series A Preferred Stock | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Noncontrolling Interest |
Balance at Dec. 31, 2019 | $ (2,474,810) | $ 4,975,503 | $ 6,029,328 | $ 3,426,946 | $ (16,722,036) | $ (184,551) | |
Balance (in Shares) at Dec. 31, 2019 | 6,328,948 | 17,130,317 | |||||
Issuances of common stock units | 100,000 | $ 54,152 | 45,848 | ||||
Issuances of common stock units (in Shares) | 250,000 | ||||||
Net loss | (742,641) | (712,566) | (30,075) | ||||
Balance at Mar. 31, 2020 | (3,117,451) | $ 4,975,503 | $ 6,083,480 | 3,472,794 | (17,434,602) | (214,626) | |
Balance (in Shares) at Mar. 31, 2020 | 6,328,948 | 17,380,317 | |||||
Balance at Dec. 31, 2019 | (2,474,810) | $ 4,975,503 | $ 6,029,328 | 3,426,946 | (16,722,036) | (184,551) | |
Balance (in Shares) at Dec. 31, 2019 | 6,328,948 | 17,130,317 | |||||
Net loss | (1,195,973) | ||||||
Balance at Sep. 30, 2020 | (3,570,783) | $ 4,975,503 | $ 6,083,480 | 3,472,794 | (17,873,743) | (228,817) | |
Balance (in Shares) at Sep. 30, 2020 | 6,328,948 | 17,380,317 | |||||
Balance at Mar. 31, 2020 | (3,117,451) | $ 4,975,503 | $ 6,083,480 | 3,472,794 | (17,434,602) | (214,626) | |
Balance (in Shares) at Mar. 31, 2020 | 6,328,948 | 17,380,317 | |||||
Net loss | (269,572) | (260,285) | (9,287) | ||||
Balance at Jun. 30, 2020 | (3,387,023) | $ 4,975,503 | $ 6,083,480 | 3,472,794 | (17,694,887) | (223,913) | |
Balance (in Shares) at Jun. 30, 2020 | 6,328,948 | 17,380,317 | |||||
Net loss | (183,760) | (178,856) | (4,904) | ||||
Balance at Sep. 30, 2020 | (3,570,783) | $ 4,975,503 | $ 6,083,480 | 3,472,794 | (17,873,743) | (228,817) | |
Balance (in Shares) at Sep. 30, 2020 | 6,328,948 | 17,380,317 | |||||
Balance at Dec. 31, 2020 | (2,964,935) | $ 729,058 | $ 4,975,503 | $ 6,083,480 | 4,436,018 | (18,220,705) | (239,231) |
Balance (in Shares) at Dec. 31, 2020 | 135 | 6,328,948 | 17,380,317 | ||||
Acquisition of Certain Assets of Halcyon Thruput, LLC | 2,500,000 | $ 2,500,000 | |||||
Acquisition of Certain Assets of Halcyon Thruput, LLC (in Shares) | 6,250,000 | ||||||
Issuances of common stock units | 400,000 | $ 136,707 | 263,293 | ||||
Issuances of common stock units (in Shares) | 800,000 | ||||||
Warrant exercises | 2,967,000 | $ 4,771,669 | (1,804,669) | ||||
Warrant exercises (in Shares) | 8,428,976 | ||||||
Issuance of common shares for Convertible Promissory Note | 217,769 | $ 217,769 | |||||
Issuance of common shares for Convertible Promissory Note (in Shares) | 618,660 | ||||||
Issuance of common shares for Senior Secured Promissory Note | 1,942,500 | $ 1,942,500 | |||||
Issuance of common shares for Senior Secured Promissory Note (in Shares) | 1,000,000 | ||||||
Stock-based compensation | 42,250 | $ 42,250 | |||||
Stock-based compensation (in Shares) | 500,000 | ||||||
Series B preferred stock dividend | (20,250) | (20,250) | |||||
Net loss | (1,833,214) | (1,836,882) | 3,668 | ||||
Balance at Mar. 31, 2021 | 3,251,120 | $ 729,058 | $ 4,975,503 | $ 15,694,375 | 2,894,642 | (20,077,837) | (235,563) |
Balance (in Shares) at Mar. 31, 2021 | 135 | 6,328,948 | 34,977,953 | ||||
Balance at Dec. 31, 2020 | (2,964,935) | $ 729,058 | $ 4,975,503 | $ 6,083,480 | 4,436,018 | (18,220,705) | (239,231) |
Balance (in Shares) at Dec. 31, 2020 | 135 | 6,328,948 | 17,380,317 | ||||
Net loss | (4,367,238) | ||||||
Balance at Sep. 30, 2021 | 893,721 | $ 591,558 | $ 1,111 | 23,776,409 | (22,644,284) | (239,515) | |
Balance (in Shares) at Sep. 30, 2021 | 118 | 111,070,329 | |||||
Balance at Mar. 31, 2021 | 3,251,120 | $ 729,058 | $ 4,975,503 | $ 15,694,375 | 2,894,642 | (20,077,837) | (235,563) |
Balance (in Shares) at Mar. 31, 2021 | 135 | 6,328,948 | 34,977,953 | ||||
Stock-based compensation | 38,750 | $ 38,750 | |||||
Stock-based compensation (in Shares) | |||||||
Series B preferred stock redemption | $ (137,500) | ||||||
Series B preferred stock redemption (in Shares) | (17) | ||||||
Series B preferred stock dividend | (20,250) | (20,250) | |||||
Net loss | (1,155,329) | (1,152,514) | (2,815) | ||||
Balance at Jun. 30, 2021 | 2,114,291 | $ 591,558 | $ 4,975,503 | $ 15,733,125 | 2,894,642 | (21,250,601) | (238,378) |
Balance (in Shares) at Jun. 30, 2021 | 118 | 6,328,948 | 34,977,953 | ||||
Stock-based compensation | 38,750 | 38,750 | |||||
Series B preferred stock dividend | (16,125) | (16,125) | |||||
Common shares issued to vendor for services | 117,500 | $ 117,500 | |||||
Common shares issued to vendor for services (in Shares) | 125,000 | ||||||
Issuance of common shares for extension of secured note | 18,000 | $ 18,000 | |||||
Issuance of common shares for extension of secured note (in Shares) | 20,000 | ||||||
Change in common stock par value due to change in corporate domicile | $ (15,868,273) | 15,868,273 | |||||
Conversion of Series A preferred stock | $ (4,975,503) | $ 759 | 4,974,744 | ||||
Conversion of Series A preferred stock (in Shares) | (6,328,948) | 75,947,376 | |||||
Net loss | (1,378,695) | (1,377,558) | (1,137) | ||||
Balance at Sep. 30, 2021 | $ 893,721 | $ 591,558 | $ 1,111 | $ 23,776,409 | $ (22,644,284) | $ (239,515) | |
Balance (in Shares) at Sep. 30, 2021 | 118 | 111,070,329 |
Unaudited Condensed Consolida_5
Unaudited Condensed Consolidated Statements of Cash Flows - USD ($) | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Cash Flows From Operating Activities | ||
Net loss | $ (4,367,238) | $ (1,195,973) |
Loss from discontinued operations | (11,349) | (5,457) |
Net loss from continuing operations | (4,355,889) | (1,190,516) |
Adjustments to reconcile net loss from continuing operations to net cash from operating activities: | ||
Depreciation expense | 1,006,804 | 54,961 |
Amortization of debt discount | 380,282 | |
Stock-based compensation | 119,750 | |
Common shares issued to vendor for services | 117,500 | |
Other income - PPP Loan forgiveness | (25,424) | |
Loss on disposal of property and equipment | 539 | |
Change in fair value of marketable securities | (11,770) | 14,736 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (52,195) | |
Prepaid expenses | (14,232) | |
Accounts payable and accrued liabilities | 176,969 | 466,533 |
Net cash from operating activities – continuing operations | (2,658,205) | (653,747) |
Net cash from operating activities – discontinued operations | 31,716 | |
Net cash from operating activities | (2,658,205) | (622,031) |
Cash Flows From Investing Activities | ||
Capital expenditures | (77,716) | |
Acquisition of certain assets of Halcyon Thruput, LLC, net of acquired cash of $224,530 | (1,525,470) | |
Proceeds from sale of investment in common stock | 34,847 | |
Net cash from investing activities – continuing operations | (1,568,339) | |
Net cash from investing activities – discontinued operations | ||
Net cash from investing activities | (1,568,339) | |
Cash Flows From Financing Activities | ||
Proceeds for common stock issuable | 150,000 | |
Issuance of common stock units | 350,000 | 100,000 |
Redemptions of Series B preferred stock | (137,500) | |
Series B preferred stock dividends paid | (16,500) | |
Proceeds from warrant exercises | 2,967,000 | |
Repayment of Halcyon bank note | (995,614) | |
Proceeds from SBA PPP Loan | 25,200 | |
Proceeds from subordinated notes | 620,000 | 340,000 |
Repayment of subordinated notes | (1,100,000) | |
Payment of mortgage payable | (103,102) | (11,740) |
Net cash from financing activities – continuing operations | 1,584,284 | 603,460 |
Net cash from financing activities – discontinued operations | ||
Net cash from financing activities | 1,584,284 | 603,460 |
Net change in cash | (2,642,260) | (18,571) |
Cash, beginning of period | 2,776,425 | 101,337 |
Cash, end of period | $ 134,165 | $ 82,766 |
Business
Business | 9 Months Ended |
Sep. 30, 2021 | |
Business [Abstract] | |
Business | 1. Business Generation Hemp, Inc. (the “Company”), formerly known as Home Treasure Finders, Inc. (“HTF”), was incorporated on August 21, 2021 in the State of Delaware. The Company was originally incorporated on July 28, 2008 in the State of Colorado. On November 27, 2019, HTF purchased approximately 94% of the common stock of Energy Hunter Resources, Inc. (“EHR”) in a series of transactions accounted for as a reverse merger (the “Transaction”). Upon closing of the Transaction, HTF changed its name to Generation Hemp, Inc. On January 11, 2021, we completed the acquisition of certain assets of Halcyon Thruput, LLC (“Halcyon”). With this acquisition, we commenced providing post-harvest and midstream services to growers by drying, processing, cleaning and stripping harvested hemp directly from the field and wetbaled at our 48,000 square foot leased facility located in Hopkinsville, Kentucky. Additionally, the Company offers safe storage services for processed hemp, which enables farmers to maximize strategic market timing. In August 2021, the Company launched its small animal bedding consumer goods product line (“Rowdy Rooster”) made from the hemp hurd byproduct that is produced from its hemp processing operations. We also generate revenue from rental of our “Cannabis Zoned” (Hemp) warehouse property located in Denver, Colorado currently leased to an unaffiliated hemp seed company. As of September 30, 2021, EHR held an approximate 8% working interest in an oil & gas property located in Cochran County, Texas within the Slaughter-Levelland Field of the San Andres formation in the Northwest Shelf of West Texas. EHR’s oil & gas activities are currently held for sale and are presented in these consolidated financial statements as discontinued operations for each of the periods presented. Our management team has been and continues to actively review acquisition candidates involved in the hemp industry that operate within a number of vertical businesses, predominantly within the midstream sector that are attractive to us and are within the hemp supply chain. Liquidity – In the nine months ended September 30, 2021, the Company used $2.7 million of cash for its operating activities. At September 30, 2021, the Company’s current liabilities, including financing obligations due within one year, totaled $4.7 million as compared with its current assets of $276 thousand. Cash payments under several financing obligations were initially due in September and October of 2021. As disclosed in Notes 5 and 6 below, these were subsequently amended to extend these payments by one to six months. The Company will continue to pursue additional capital raising opportunities in order to fund future acquisitions and meet its obligations as they become due. In the event financing cannot be obtained, the Company may not be able to satisfy these plans and obligations. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Impact of COVID-19 Pandemic on Our Business – |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting of normal recurring adjustments, necessary to fairly present the financial position as of, and the results of operations for, all periods presented. In preparing the accompanying financial statements, management has made certain estimates and assumptions that affect reported amounts in the condensed consolidated financial statements and disclosures of contingencies. Actual results may differ from those estimates. The results for interim periods are not necessarily indicative of annual results. Certain reclassifications have been made to the prior period’s consolidated financial statements and related footnotes to conform them to the current period presentation. Intercompany balances and transactions between consolidated entities are eliminated. Revenue Recognition Rental revenue is recognized based on the contractual cash rental payments for the period. Oil & gas revenue is recognized for discontinued operations based on delivered quantities in the amount of the consideration to which the Company is entitled. Stock-based Compensation – Fair Value Measurement The Company’s non-financial assets measured at fair value on non-recurring basis include impairment measurements of oil and gas properties and warrants issued as part of financing transactions. These are considered Level 3 measurements as they involve significant unobservable inputs. Major Customer and Concentration of Credit Risk During the three and nine months ended September 30, 2021, one customer accounted for approximately 99% and 90% of our post-harvest and midstream services revenue, respectively. Amounts outstanding from this customer represented 99% of total accounts receivable at September 30, 2021. Our rental revenue is derived from a single lessee on a commercial warehouse owned by the Company. There were no amounts due from this customer at September 30, 2021 or December 31, 2020. Recent Accounting Pronouncements – Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity There are no other new accounting pronouncements that are expected to have a material impact on the consolidated financial statements. |
Acquisition
Acquisition | 9 Months Ended |
Sep. 30, 2021 | |
Business Combinations [Abstract] | |
Acquisition | 3. Acquisition On January 11, 2021, the Company completed the acquisition of certain assets of Halcyon pursuant to the Asset Purchase Agreement dated March 7, 2020, as amended on January 11, 2021. The purchase consideration totaled approximately $6.1 million consisting of 6,250,000 shares of Company common stock valued at $2.5 million (valued at $0.40 per share; restricted from trading for a period of up to one year), $1.75 million in cash, a promissory note for $850,000 issued by the Company’s subsidiary, GenH Halcyon Acquisition, LLC, and guaranteed by Gary C. Evans, CEO of the Company, and assumption of approximately $1.0 million of new indebtedness of Halcyon. The Company was granted an option to purchase the real estate occupied by Halcyon for $993,000. This option is exercisable at any time before its expiration on January 11, 2022. The acquisition was accounted for as a business combination where the Company is the acquirer and the acquisition method of accounting was applied in accordance with GAAP. Accordingly, the aggregate value of the consideration we paid to complete the acquisition was allocated to the assets acquired based upon their estimated fair values on the acquisition date. The following table summarizes the purchase price allocation for the assets acquired. This allocation is preliminary. In the third quarter of 2021, we made adjustments to the previously recognized amounts for inventory, intangibles, goodwill and the real estate purchase option based on the preliminary results of a valuation study. The final allocation of the purchase price will be determined at a later date and is dependent on a number of factors, including the final evaluation of the fair value of tangible and identifiable intangible assets acquired. Final adjustments, including increases and decreases to depreciation and amortization resulting from the allocation of the purchase price to amortizable tangible and intangible assets, may be material. Accounts receivable $ 75,470 Other working capital 224,530 Property and equipment, other 1,712,170 Intangibles: Non-competition agreements 64,691 Customer relationships 3,102,052 Other assets - Purchase option on real estate 407,000 Goodwill 509,701 Assets acquired $ 6,095,614 Intangible assets consist of customer relationships and non-compete agreements, each having definite-lives. These intangible assets are being amortized over the estimated useful life on an accelerated basis reflecting the anticipated future cash flows of the Company post acquisition of Halcyon. The results of operations for the acquired Halcyon assets have been included in the Company’s consolidated financial statements since the January 11, 2021 acquisition date. Concurrent with the closing of the asset acquisition, the Company entered into term employment agreements with two executives to serve as vice presidents of the Company for a term of at least two years. The term employment agreements each provide for the issuance of 250,000 shares of restricted common stock of the Company as a signing bonus. Such shares are subject to restrictions on the trading or transfer of such common stock. Further, the term employment agreements each provide for the payment by the executives of liquidated damages if the employee terminates his employment without good reason during the initial term, other than due to the employee’s death or disability. Such liquidated damages total $600,000 if such termination occurs on or prior to January 11, 2022 or $375,000 if such termination occurs after January 11, 2022 and prior to January 11, 2023. On March 3, 2021, the Company repaid the outstanding principal and interest balance on the $850,000 promissory note issued in connection with the acquisition. Supplemental Pro Forma Information The supplemental pro forma financial information reflects pro forma adjustments to present the combined pro forma results of operations as if the acquisition had occurred on January 1, 2020, to give effect to certain events that management believes to be directly attributable to the acquisition. These pro forma adjustments primarily include: ● an increase to depreciation and amortization expense that would have been recognized due to acquired tangible and intangible assets; and ● an adjustment to interest expense to reflect the reduced borrowings due to the repayment of Halcyon’s historical debt in conjunction with the acquisition; The supplemental pro forma financial information for the periods presented is as follows: For the three months ended September 30, For the nine months ended September 30, 2021 2020 2021 2020 Revenue, continuing operations $ 502,088 $ 974,434 $ 596,291 $ 1,106,440 Income (loss) from continuing operations (1,377,065 ) 59,631 (4,424,786 ) (1,528,788 ) Earnings (loss) per common share: Basic and diluted $ (0.03 ) $ 0.00 $ (0.11 ) $ (0.09 ) |
Discontinued Operations
Discontinued Operations | 9 Months Ended |
Sep. 30, 2021 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | 4. Discontinued Operations In connection with the Transaction, management determined to fully divest of EHR’s oil and gas activities. As such, these activities are presented as discontinued operations for each of the periods presented. The following is a summary of the carrying amounts of major classes of assets and liabilities of the discontinued operations to assets and liabilities held for sale: September 30, December 31, 2021 2020 Assets - Oil and natural gas properties held for sale, at cost $ 1,874,849 $ 1,874,849 Accumulated DD&A (1,874,849 ) (1,874,849 ) Total assets of discontinued operations held for sale $ - $ - Liabilities Accrued liabilities $ 32,583 $ 31,117 Asset retirement obligations 52,368 56,834 Revenue payable 52,117 52,117 Current liabilities of discontinued operations held for sale 137,068 140,068 Asset retirement obligations - Long-term liabilities of discontinued operations held for sale 158,498 144,149 Total liabilities of discontinued operations held for sale $ 295,566 $ 284,217 The following is a summary of the major classes of line items constituting loss on discontinued operations shown in the consolidated statements of operations: For the three months ended September 30, For the nine months ended September 30, 2021 2020 2021 2020 Revenue - Oil and gas sales $ 55,140 $ 13,036 $ 93,248 $ 93,361 Costs and Expenses Lease operating expense 53,919 16,762 94,714 77,099 Depreciation, depletion & amortization - - - 9,942 Accretion 2,851 4,263 9,883 12,868 Gain on disposal of oil & gas property interests - - (24,008 ) Total costs and expenses 56,770 21,025 104,597 75,901 Interest expense - - - 22,917 Loss from discontinued operations $ (1,630 ) $ (7,989 ) $ (11,349 ) $ (5,457 ) |
Notes Payable _ Related Parties
Notes Payable – Related Parties | 9 Months Ended |
Sep. 30, 2021 | |
Note Payable Related Party [Abstract] | |
Notes Payable – Related Parties | 5. Notes Payable – Related Parties Notes payable – related parties consisted of the following: September 30, December 31, 2021 2020 Senior Secured Promissory Note $ - $ 1,500,000 Convertible Promissory Note - 208,874 Subordinated Promissory Note to CEO 490,000 490,000 Convertible Promissory Note to CEO 620,000 - Secured Promissory Note to Coventry Asset Management, LTD. 1,000,000 1,000,000 Subordinated Promissory Note to Investor 250,000 500,000 Total 2,360,000 3,698,874 Less debt discounts - (362,282 ) Total Notes Payable – Related Parties $ 2,360,000 $ 3,336,592 Senior Secured Promissory Note – Convertible Promissory Note – Subordinated Promissory Note to CEO – Convertible Promissory Note to CEO Secured Promissory Note and Warrants to Coventry Asset Management, LTD. – The holder of the secured promissory note received a warrant to purchase 1,000,000 shares of common stock exercisable at an exercise price of $0.352 per share upon origination of the promissory note in 2020. This warrant was subsequently exercised in the first quarter of 2021. Subordinated Promissory Note and Warrants to Investor The holder of the subordinated note received a warrant to purchase 500,000 shares of common stock exercisable until December 30, 2022 at an exercise price of $0.352 per share. |
Other Indebtedness
Other Indebtedness | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Other Indebtedness | 6. Other Indebtedness Other indebtedness consisted of the following: September 30, December 31, 2021 2020 Mortgage Payable $ 516,359 $ 619,461 Paycheck Protection Program Loan - 25,200 Total 516,359 644,661 Less current portion (516,359 ) (619,461 ) Total Other Indebtedness - Long-Term $ - $ 25,200 Mortgage Payable and Operating Lease — In July 2021, the mortgage payable was amended to a new maturity date of October 15, 2021. The Company made a $100,000 principal payment and paid an extension fee of $6,000 in July 2021 for this amendment. The rate during the extension period was increased to 12% annually and the new monthly payment is $5,279. In October 2021, the mortgage payable was amended to a new maturity date of January 15, 2022. The Company will pay an extension fee of $1,000 each month beginning November 15, 2021. The new monthly payment of the note is $5,500 including interest at an effective rate of approximately 13%. The Company leases the Denver warehouse property to a tenant under an operating lease which was renewed with a new tenant and extended to August 1, 2023 for a monthly rent of $7,500. The lease requires a true-up with the tenant for property taxes and insurance paid by the Company and requires the tenant to maintain the interior and exterior of the warehouse (except for the roof). The lease provides for a rent abatement in the first and last month of the contracted extension. Minimum future rents for the remainder of 2021 are $22,500, for 2022 are $90,000 and for 2023 are $52,500. Paycheck Protection Program Loan – PPP loan recipients may be eligible to have their loans forgiven if the funds were used for eligible expenses over the eight-week coverage period commencing when the loan was originally disbursed. The amount of forgiveness may be reduced if the percentage of eligible expenses attributed to nonpayroll expenses exceeds 25% of the loan, if employee headcount decreases, or compensation decreases by more than 25% for each employee making less than $100,000 per year, unless the reduced headcount or compensation levels are restored. On April 29, 2020, we received disbursement of an approved PPP loan in the amount of $25,200. The Company received notice from the SBA that the PPP Loan principal and interest thereon was fully forgiven on April 20, 2021. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 7. Commitments and Contingencies Leases – The Company leases its operating facility in Kentucky from Oz Capital, LLC, a related party, under a lease expiring May 31, 2024. The lease provides for monthly payments of $10,249. Oz Capital, LLC is responsible for all taxes and maintenance under the lease. Lease expense for this facility totaled $30,747 and $88,604 in the three and nine months ended September 30, 2021, respectively. A right-of-use asset and lease liability is recorded for this lease. The right-of-use asset represent the right to use the underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments arising from the lease. A right-of-use asset and lease liabilities were recognized at the commencement date based on the present value of lease payments over the lease term. As the lease does not provide an implicit rate, the Company used its estimated incremental borrowing rate of 10% in determining the present value of the lease payments. Pending Insurance Claim – Litigation – JDONE, LLC v. Grand Traverse Holdings, LLC and John Gallegos, Denver District Court Case No. 2019CV33723 JDONE, LLC (“JDONE”) is a wholly owned subsidiary of the Company and landlord of a commercial warehouse building that was leased to Grand Traverse Holdings, LLC on December 31, 2018 for a term of 61 months, with a personal guaranty from Defendant, John Gallegos. On April 12, 2019, Grand Traverse presented JDONE with an alleged forged, signed copy of the draft early termination amendment that JDONE had previously rejected. JDONE has suffered damages due to Defendant’s alleged misconduct of approximately $823,504 plus interest and attorney’s fees exceeding $300,000. A court ordered mediation was held in May 2020 without success. All material defendant motions have been denied by the court. The case is set for jury trial in January 2022. We believe that Grand Traverse Holdings, LLC and John Gallegos are jointly liable for the asserted damages which exceed $1 million and continue to vigorously pursue our claims. KBSIII Tower at Lake Carolyn, LLC and Prime US-Tower at Lake Carolyn, LLC (collectively – “KBSIII”) vs. Energy Hunter Resources, Inc. Plaintiff/Counterdefendant KBSIII was seeking lost rent on office space for periods after EHR vacated office premises located in Las Colinas, Texas. EHR filed a counter suit alleging specific damages due to uninhabitable premises of the office space due to the intolerable conduct of other tenants located on the same floor. On December 23, 2020, the trial court entered a summary judgment against EHR for $230,712. The judgment provides for post-judgment interest at a rate of 5% per annum until paid and further provides for additional amounts owed should EHR pursue unsuccessful appeals to higher courts. At September 30, 2021, the Company had accrued $252,583 for this judgment, which is exclusively an EHR obligation. |
Equity
Equity | 9 Months Ended |
Sep. 30, 2021 | |
Stockholders' Equity Note [Abstract] | |
Equity | 8. Equity Change of Corporate Domicile Series A Preferred Stock – Series B Preferred Stock Units – The sale of the preferred stock units for $10,000 each resulted in aggregate gross proceeds of approximately $1.35 million, before deducting estimated offering expenses payable by the Company. Substantially all of the proceeds raised in the offering were used to fund the acquisition of assets of Halcyon, expenses related thereto and for general corporate purposes. Each share of Series B Preferred Stock is initially convertible into 25,000 shares of common stock, subject to adjustment. Holders of Series B Preferred Stock are entitled to receive dividends of 6.00% per annum based on the stated value equal to $10,000 per share. Except as otherwise required by law, the Series B Preferred Stock does not have voting rights. However, as long as any shares of Series B Preferred Stock are outstanding, the Company will not, without the affirmative vote of the holders of a majority of the then outstanding shares of the Series B Preferred Stock, (a) alter or change adversely the powers, preferences or rights given to the Series B Preferred Stock, (b) alter or amend the related certificate of designation, (c) amend its certificate of incorporation or other charter documents in any manner that adversely affects any rights of the holders of Series B Preferred Stock, (d) repay, repurchase or offer to repay, repurchase or otherwise acquire more than a de minimis number of shares of its common stock, (e) enter into any agreement with respect to any of the foregoing, or (f) pay cash dividends or distributions on any equity securities of the Company other than pursuant to the terms of the outstanding Series B Preferred Stock. The Series B Preferred Stock does not have a preference upon any liquidation, dissolution or winding-up of the Company. Beginning the later of June 30, 2021 or the effectiveness of any registration statement registering the underlying common shares, all or any portion of the Series B Preferred Stock may be converted, at their holder’s option, into 25,000 shares of common stock, as adjusted for any stock dividends, splits, combinations or similar events. At any time after the occurrence of a “Qualifying Event,” the Company, upon 5-day written notice, shall have the right to cause each share of Series B Preferred Stock (and all accrued in-kind dividends with respect thereto) to be converted into common stock. For purposes of this automatic conversion of the Series B Preferred Stock, a “Qualifying Event” shall have occurred if (A) (1) the rolling five-trading day volume-weighted average trading price of shares of the common stock exceeds $1.00, and (2) there shall be an effective registration statement under the Securities Act of 1933, as amended covering all of the shares of common stock which would be issuable upon conversion of all of the outstanding shares of Series B Preferred Stock or (B) the Company closes a firm commitment underwriting of the common stock on a Form S-1 Registration Statement with aggregate gross proceeds of at least $5,000,000 at a price per share equal to or greater than $1.00. In each instance, a conversion may not be made unless the Company has filed an amendment to its Articles of Incorporation effecting an increase in its authorized common stock so that the Company has a sufficient number of authorized and unissued shares of common stock so as to permit the conversion of all outstanding shares. The Series B Preferred Stock may be redeemed by the Company for its stated value, plus accrued and unpaid dividends, at any time. Initially, redemption payments of 12.5% each of the total amount of Series B Preferred Stock then outstanding plus accrued dividends were due from the Company to each Holder of Series B Preferred Stock at the end of each calendar quarter of 2021. The first required redemption payments totaling $137,500 were made in April 2021. In May, June and October of 2021, the three holders of the Series B Preferred Stock, including the Company’s chief executive officer, entered into transactions in which they accepted the mandatory redemption payment required pursuant to the Series B Preferred Stock certificate of designation in a number of Series B Units to effectively waive the redemption requirement. All other terms of the Series B Units remain unchanged and the holders’ ownership interest in the Series B Preferred Units remains the same as it was before such transactions. Common Stock – ● February 2020 Issuance of Common Stock Units – The common stock issued in the exchange was valued using the trading price of the common stock on February 20, 2020. The warrants were valued at $45,848 using a binomial lattice valuation model using inputs as of the exchange date. Our expected volatility assumption was based on the historical volatility of the Company’s common stock (252%). The expected life assumption was based on the expiration date of the warrant (two years). The risk-free interest rate for the expected term of the warrant was based on the U.S. Treasury yield curve in effect at the time of measurement (1.39%). The warrants are classified within equity in the consolidated balance sheets. Under GAAP, the anti-dilution provisions will be accounted for if and when these provisions are triggered. ● Acquisition of Certain Assets of Halcyon ● 2021 First Quarter Issuances of Common Stock Units ● Warrant Exercises ● Issuances for Exchange or Conversion of Debt ● Issuance to Vendor for Services ● Issuance for Extension of Secured Note ● Issuance for Conversion of Series A Preferred Stock ● Stock-based Compensation Common Stock Warrants Outstanding – # of Warrants Exercise Price Expiration Date Method of Exercise Issued upon exchange of EHR Series C Preferred Stock (1) 1,065,340 $ 0.352 November 27, 2021 Cash Issued upon exchange of EHR Series C Preferred Stock (1) 7,244,316 $ 0.352 November 27, 2021 Cashless Issued in February 2020 with common stock units (2) 250,000 $ 0.400 March 1, 2022 Cash Issued in December 2020 with Series B preferred units (1) 5,500,000 $ 0.352 December 30, 2022 Cash Issued in December 2020 with subordinated note to investor (1) 500,000 $ 0.352 December 30, 2022 Cash Issued in Q1 2021 with common stock units (1) 1,600,000 $ 0.500 Jan-Feb, 2023 Cash Total warrants outstanding at September 30, 2021 16,159,656 (1) May be redeemed for $0.0001 per warrant at the Company’s option with 30 days advanced notice should the weighted average market price of common stock exceed $1.00 for any five out of seven consecutive trading days with a minimum average daily trading volume for such seven-day period of at least 25,000 shares of common stock. (2) Contains certain anti-dilution provisions requiring a downward adjustment to the exercise price of the warrant if dilutive instruments are issued at prices less than the warrant exercise price. Following is a summary of outstanding stock warrants activity for the periods presented: Warrants as of January 1, 2020 14,488,632 Issued 250,000 Warrants as of September 30, 2020 14,738,632 Warrants as of January 1, 2021 22,988,632 Issued 1,600,000 Exercised (8,428,976 ) Warrants as of September 30, 2021 16,159,656 |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | 9. Stock-Based Compensation We award restricted stock or stock options as incentive compensation to employees. Generally, these awards include vesting periods of up to three years from the date of grant. The 2021 Omnibus Incentive Plan (“2021 Plan”) was adopted by our Board on July 1, 2021. The 2021 Plan provides for the initial reservation of 15 million shares of common stock for issuance, and provides that the maximum number of shares that may be issued pursuant to the exercise of ISOs is 15 million. The number of shares of common stock available for issuance under the 2021 Plan constituted approximately 13.1% of the Company’s fully diluted common shares outstanding as of the date of Board approval, including shares issuable upon the conversion of preferred shares, as calculated on an as-converted basis. On the one-year anniversary date of the 2021 Plan, the number of shares of common stock reserved for issuance thereunder shall automatically increase to 20% of the fully diluted common shares outstanding, including shares issuable upon the conversion of preferred shares, as calculated on an as-converted basis. In the first quarter of 2021, the Company issued 500,000 restricted shares valued at $158,500 as incentive compensation to two executives who joined the Company. Compensation expense related to these awards totaled $38,750 and $119,750 for the three and nine months ended September 30, 2021, respectively. As of September 30, 2021, there was $38,750 of total unrecognized compensation cost related to unvested awards to be recognized over a weighted-average period of three months. On April 6, 2021, the Company announced that Chad Burkhardt has joined the Company as its Vice President and General Counsel, effective April 1, 2021. In addition to his annual salary, the Company agreed to make a future grant to Mr. Burkhardt of $750,000 worth of options for the purchase of our common stock at an exercise price equal to the fair market value of the Company’s common stock on the date of grant. Such options will vest annually in equal installments over a three-year period from his date of hire. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2021 | |
Income Taxes [Abstract] | |
Income Taxes | 10. Income Taxes Income tax provisions for interim quarterly periods are generally based on an estimated annual effective income tax rate calculated separately from the effect of significant, infrequent or unusual items related specifically to interim periods. An income tax benefit for the three and nine months ended September 30, 2021 or 2020 was not recognized because tax losses incurred were fully offset by a valuation allowance against deferred tax assets. There were no uncertain tax positions as of September 30, 2021. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 9 Months Ended |
Sep. 30, 2021 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information | 11. Supplemental Cash Flow Information For the nine months ended 2021 2020 Cash paid for interest $ 127,812 $ - Cash paid for taxes - - Noncash investing and financing activities: Acquisition of certain assets of Halcyon Thruput, LLC - issuance of common shares 2,500,000 - - issuance of subordinated note 850,000 - - assumption of Halcyon bank note 995,614 - Series B preferred stock dividend payable 39,137 - Issuance of common stock units previously subscribed 50,000 - Issuances of common shares for exchange or conversion of debt 2,160,269 - |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Earnings (Loss) per Share | 12. Earnings (Loss) per Share The following is the computation of earnings (loss) per basic and diluted share: For the three months ended For the nine months ended 2021 2020 2021 2020 Amounts attributable to Generation Hemp: Numerator Loss from continuing operations attributable to common stockholders $ (1,376,030 ) $ (171,367 ) $ (4,356,315 ) $ (1,146,592 ) Loss from discontinued operations (1,528 ) (7,489 ) (10,639 ) (5,115 ) Less: preferred stock dividends (16,125 ) - (56,625 ) - Net loss attributable to common stockholders $ (1,393,683 ) $ (178,856 ) $ (4,423,579 ) $ (1,151,707 ) Denominator Weighted average shares used to compute basic EPS 54,109,797 17,380,317 38,693,679 17,500,308 Dilutive effect of convertible note - - - - Dilutive effect of preferred stock 59,913,657 75,947,376 72,641,084 75,947,376 Dilutive effect of common stock warrants 9,042,419 - 11,126,327 - Weighted average shares used to compute diluted EPS 123,065,873 93,327,693 122,461,090 93,447,684 Earnings (loss) per share: Loss from continuing operations Basic $ (0.03 ) $ (0.01 ) $ (0.11 ) $ (0.07 ) Diluted $ (0.03 ) $ (0.01 ) $ (0.11 ) $ (0.07 ) (Loss) income from discontinued operations Basic $ - $ - $ - $ - Diluted $ - $ - $ - $ - Earnings (loss) per share Basic $ (0.03 ) $ (0.01 ) $ (0.11 ) $ (0.07 ) Diluted $ (0.03 ) $ (0.01 ) $ (0.11 ) $ (0.07 ) The computation of diluted earnings per common share excludes the assumed conversion of the Series B Preferred Stock and outstanding convertible notes and exercise of common stock warrants in periods when we report a loss. The dilutive effect of the assumed exercise of outstanding warrants was calculated using the treasury stock method. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | 13. Subsequent Events In October 2021, the Company issued 416,667 common stock units to an accredited investor for total proceeds of $250,000. Each common stock unit consists of one share of common stock and a warrant for the purchase of one share of common stock for $0.60 each. Each warrant is exercisable any time before its expiration on the second anniversary of its issuance. As disclosed in Note 5 above, (i) we amended the subordinated note to our CEO in the amount of $490,000 to a new maturity date of January 31, 2022, (ii) we amended the secured promissory note to Coventry Asset Management, LTD. to a new maturity date of January 31, 2022 with an earlier maturity date of December 31, 2021 in the event of a new equity capital raise is completed and granted the holder a limited option to convert part of the principal to common stock and (iii) we amended the subordinated promissory note with an investor to a new maturity date of March 31, 2022 with an earlier maturity date of December 31, 2021 in the event of a new equity capital raise is completed. In October 2021, our CEO made advances totaling $15,000 to the Company. The existing convertible promissory note was amended and restated to a new balance of $635,000. The interest rate of 10% per annum and maturity date of January 1, 2022 were unchanged. As disclosed in Note 6 above, the mortgage payable was amended to a new maturity date of January 15, 2022. |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting of normal recurring adjustments, necessary to fairly present the financial position as of, and the results of operations for, all periods presented. In preparing the accompanying financial statements, management has made certain estimates and assumptions that affect reported amounts in the condensed consolidated financial statements and disclosures of contingencies. Actual results may differ from those estimates. The results for interim periods are not necessarily indicative of annual results. Certain reclassifications have been made to the prior period’s consolidated financial statements and related footnotes to conform them to the current period presentation. Intercompany balances and transactions between consolidated entities are eliminated. |
Revenue Recognition | Revenue Recognition Rental revenue is recognized based on the contractual cash rental payments for the period. Oil & gas revenue is recognized for discontinued operations based on delivered quantities in the amount of the consideration to which the Company is entitled. |
Stock-based Compensation | Stock-based Compensation – |
Fair Value Measurement | Fair Value Measurement The Company’s non-financial assets measured at fair value on non-recurring basis include impairment measurements of oil and gas properties and warrants issued as part of financing transactions. These are considered Level 3 measurements as they involve significant unobservable inputs. |
Major Customer and Concentration of Credit Risk | Major Customer and Concentration of Credit Risk During the three and nine months ended September 30, 2021, one customer accounted for approximately 99% and 90% of our post-harvest and midstream services revenue, respectively. Amounts outstanding from this customer represented 99% of total accounts receivable at September 30, 2021. Our rental revenue is derived from a single lessee on a commercial warehouse owned by the Company. There were no amounts due from this customer at September 30, 2021 or December 31, 2020. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements – Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity There are no other new accounting pronouncements that are expected to have a material impact on the consolidated financial statements. |
Acquisition (Tables)
Acquisition (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Business Combinations [Abstract] | |
Schedule of amortizable tangible and intangible assets | Accounts receivable $ 75,470 Other working capital 224,530 Property and equipment, other 1,712,170 Intangibles: Non-competition agreements 64,691 Customer relationships 3,102,052 Other assets - Purchase option on real estate 407,000 Goodwill 509,701 Assets acquired $ 6,095,614 |
Schedule of pro forma consolidated results of operations | For the three months ended September 30, For the nine months ended September 30, 2021 2020 2021 2020 Revenue, continuing operations $ 502,088 $ 974,434 $ 596,291 $ 1,106,440 Income (loss) from continuing operations (1,377,065 ) 59,631 (4,424,786 ) (1,528,788 ) Earnings (loss) per common share: Basic and diluted $ (0.03 ) $ 0.00 $ (0.11 ) $ (0.09 ) |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of discontinued operations to assets and liabilities | September 30, December 31, 2021 2020 Assets - Oil and natural gas properties held for sale, at cost $ 1,874,849 $ 1,874,849 Accumulated DD&A (1,874,849 ) (1,874,849 ) Total assets of discontinued operations held for sale $ - $ - Liabilities Accrued liabilities $ 32,583 $ 31,117 Asset retirement obligations 52,368 56,834 Revenue payable 52,117 52,117 Current liabilities of discontinued operations held for sale 137,068 140,068 Asset retirement obligations - Long-term liabilities of discontinued operations held for sale 158,498 144,149 Total liabilities of discontinued operations held for sale $ 295,566 $ 284,217 |
Schedule of discontinued operations shown in the consolidated statements of operations | For the three months ended September 30, For the nine months ended September 30, 2021 2020 2021 2020 Revenue - Oil and gas sales $ 55,140 $ 13,036 $ 93,248 $ 93,361 Costs and Expenses Lease operating expense 53,919 16,762 94,714 77,099 Depreciation, depletion & amortization - - - 9,942 Accretion 2,851 4,263 9,883 12,868 Gain on disposal of oil & gas property interests - - (24,008 ) Total costs and expenses 56,770 21,025 104,597 75,901 Interest expense - - - 22,917 Loss from discontinued operations $ (1,630 ) $ (7,989 ) $ (11,349 ) $ (5,457 ) |
Notes Payable _ Related Parti_2
Notes Payable – Related Parties (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Note Payable Related Party [Abstract] | |
Schedule of notes payable related parties | September 30, December 31, 2021 2020 Senior Secured Promissory Note $ - $ 1,500,000 Convertible Promissory Note - 208,874 Subordinated Promissory Note to CEO 490,000 490,000 Convertible Promissory Note to CEO 620,000 - Secured Promissory Note to Coventry Asset Management, LTD. 1,000,000 1,000,000 Subordinated Promissory Note to Investor 250,000 500,000 Total 2,360,000 3,698,874 Less debt discounts - (362,282 ) Total Notes Payable – Related Parties $ 2,360,000 $ 3,336,592 |
Other Indebtedness (Tables)
Other Indebtedness (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of other indebtedness | September 30, December 31, 2021 2020 Mortgage Payable $ 516,359 $ 619,461 Paycheck Protection Program Loan - 25,200 Total 516,359 644,661 Less current portion (516,359 ) (619,461 ) Total Other Indebtedness - Long-Term $ - $ 25,200 |
Equity (Tables)
Equity (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Stockholders' Equity Note [Abstract] | |
Schedule of warrants outstanding | # of Warrants Exercise Price Expiration Date Method of Exercise Issued upon exchange of EHR Series C Preferred Stock (1) 1,065,340 $ 0.352 November 27, 2021 Cash Issued upon exchange of EHR Series C Preferred Stock (1) 7,244,316 $ 0.352 November 27, 2021 Cashless Issued in February 2020 with common stock units (2) 250,000 $ 0.400 March 1, 2022 Cash Issued in December 2020 with Series B preferred units (1) 5,500,000 $ 0.352 December 30, 2022 Cash Issued in December 2020 with subordinated note to investor (1) 500,000 $ 0.352 December 30, 2022 Cash Issued in Q1 2021 with common stock units (1) 1,600,000 $ 0.500 Jan-Feb, 2023 Cash Total warrants outstanding at September 30, 2021 16,159,656 |
Schedule of outstanding stock warrants activity | Warrants as of January 1, 2020 14,488,632 Issued 250,000 Warrants as of September 30, 2020 14,738,632 Warrants as of January 1, 2021 22,988,632 Issued 1,600,000 Exercised (8,428,976 ) Warrants as of September 30, 2021 16,159,656 |
Supplemental Cash Flow Inform_2
Supplemental Cash Flow Information (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of supplemental cash flow information | For the nine months ended 2021 2020 Cash paid for interest $ 127,812 $ - Cash paid for taxes - - Noncash investing and financing activities: Acquisition of certain assets of Halcyon Thruput, LLC - issuance of common shares 2,500,000 - - issuance of subordinated note 850,000 - - assumption of Halcyon bank note 995,614 - Series B preferred stock dividend payable 39,137 - Issuance of common stock units previously subscribed 50,000 - Issuances of common shares for exchange or conversion of debt 2,160,269 - |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of earnings (loss) per basic and diluted share | For the three months ended For the nine months ended 2021 2020 2021 2020 Amounts attributable to Generation Hemp: Numerator Loss from continuing operations attributable to common stockholders $ (1,376,030 ) $ (171,367 ) $ (4,356,315 ) $ (1,146,592 ) Loss from discontinued operations (1,528 ) (7,489 ) (10,639 ) (5,115 ) Less: preferred stock dividends (16,125 ) - (56,625 ) - Net loss attributable to common stockholders $ (1,393,683 ) $ (178,856 ) $ (4,423,579 ) $ (1,151,707 ) Denominator Weighted average shares used to compute basic EPS 54,109,797 17,380,317 38,693,679 17,500,308 Dilutive effect of convertible note - - - - Dilutive effect of preferred stock 59,913,657 75,947,376 72,641,084 75,947,376 Dilutive effect of common stock warrants 9,042,419 - 11,126,327 - Weighted average shares used to compute diluted EPS 123,065,873 93,327,693 122,461,090 93,447,684 Earnings (loss) per share: Loss from continuing operations Basic $ (0.03 ) $ (0.01 ) $ (0.11 ) $ (0.07 ) Diluted $ (0.03 ) $ (0.01 ) $ (0.11 ) $ (0.07 ) (Loss) income from discontinued operations Basic $ - $ - $ - $ - Diluted $ - $ - $ - $ - Earnings (loss) per share Basic $ (0.03 ) $ (0.01 ) $ (0.11 ) $ (0.07 ) Diluted $ (0.03 ) $ (0.01 ) $ (0.11 ) $ (0.07 ) |
Business (Details)
Business (Details) $ in Thousands | Jan. 11, 2021$ / ft² | Nov. 27, 2019 | Sep. 30, 2021USD ($) |
Accounting Policies [Abstract] | |||
Owns approximately percentage | 94.00% | ||
Square Foot Facility (in Dollars per Square Foot) | $ / ft² | 48,000 | ||
Description of business, description | EHR held an approximate 8% working interest in an oil & gas property located in Cochran County, Texas within the Slaughter-Levelland Field of the San Andres formation in the Northwest Shelf of West Texas. EHR’s oil & gas activities are currently held for sale and are presented in these consolidated financial statements as discontinued operations for each of the periods presented. | ||
Cash for operating activities | $ 2,700 | ||
Financing obligations | 4,700 | ||
Current Assets | $ 276 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Details) | 3 Months Ended | 9 Months Ended |
Sep. 30, 2021 | Sep. 30, 2021 | |
One Customer [Member] | ||
Summary of Significant Accounting Policies (Details) [Line Items] | ||
Service revenue percentage | 99.00% | 90.00% |
Acquisition (Details)
Acquisition (Details) - USD ($) | Jan. 11, 2021 | Sep. 30, 2021 | Mar. 03, 2021 | Dec. 31, 2020 |
Acquisition (Details) [Line Items] | ||||
Company common stock (in Shares) | 111,070,329 | 17,380,317 | ||
Per share value (in Dollars per share) | $ 0.00001 | |||
Promissory note | $ 850,000 | |||
Issuance of restricted common stock (in Shares) | 250,000 | |||
Employee terminates, description | the employee terminates his employment without good reason during the initial term, other than due to the employee’s death or disability. Such liquidated damages total $600,000 if such termination occurs on or prior to January 11, 2022 or $375,000 if such termination occurs after January 11, 2022 and prior to January 11, 2023. | |||
Halcyon [Member] | ||||
Acquisition (Details) [Line Items] | ||||
Consideration value | $ 6,100,000 | |||
Company common stock (in Shares) | 6,250,000 | |||
Common stock, value | $ 2,500,000 | |||
Per share value (in Dollars per share) | $ 0.4 | |||
Cash | $ 1,750,000 | |||
Promissory note | $ 850,000 | |||
Real estate occupied, description | the Company, and assumption of approximately $1.0 million of new indebtedness of Halcyon. The Company was granted an option to purchase the real estate occupied by Halcyon for $993,000. This option is exercisable at any time before its expiration on January 11, 2022. |
Acquisition (Details) - Schedul
Acquisition (Details) - Schedule of amortizable tangible and intangible assets - Acquisitions [Member] | Sep. 30, 2021USD ($) |
Indefinite-lived Intangible Assets [Line Items] | |
Accounts receivable | $ 75,470 |
Other working capital | 224,530 |
Property and equipment, other | 1,712,170 |
Intangibles: | |
Non-competition agreements | 64,691 |
Customer relationships | 3,102,052 |
Other assets - Purchase option on real estate | 407,000 |
Goodwill | 509,701 |
Assets acquired | $ 6,095,614 |
Acquisition (Details) - Sched_2
Acquisition (Details) - Schedule of pro forma consolidated results of operations - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Schedule of pro forma consolidated results of operations [Abstract] | ||||
Revenue, continuing operations | $ 502,088 | $ 974,434 | $ 596,291 | $ 1,106,440 |
Income (loss) from continuing operations | $ (1,377,065) | $ 59,631 | $ (4,424,786) | $ (1,528,788) |
Earnings (loss) per common share: | ||||
Basic and diluted (in Dollars per share) | $ (0.03) | $ 0 | $ (0.11) | $ (0.09) |
Discontinued Operations (Detail
Discontinued Operations (Details) - Schedule of discontinued operations to assets and liabilities - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Schedule of discontinued operations to assets and liabilities [Abstract] | ||
Oil and natural gas properties held for sale, at cost | $ 1,874,849 | $ 1,874,849 |
Accumulated DD&A | (1,874,849) | (1,874,849) |
Total assets of discontinued operations held for sale | ||
Accrued liabilities | 32,583 | 31,117 |
Asset retirement obligations | 52,368 | 56,834 |
Revenue payable | 52,117 | 52,117 |
Current liabilities of discontinued operations held for sale | 137,068 | 140,068 |
Asset retirement obligations - | ||
Long-term liabilities of discontinued operations held for sale | 158,498 | 144,149 |
Total liabilities of discontinued operations held for sale | $ 295,566 | $ 284,217 |
Discontinued Operations (Deta_2
Discontinued Operations (Details) - Schedule of discontinued operations shown in the consolidated statements of operations - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Revenue - | ||||
Oil and gas sales | $ 55,140 | $ 13,036 | $ 93,248 | $ 93,361 |
Costs and Expenses | ||||
Lease operating expense | 53,919 | 16,762 | 94,714 | 77,099 |
Depreciation, depletion & amortization | 9,942 | |||
Accretion | 2,851 | 4,263 | 9,883 | 12,868 |
Gain on disposal of oil & gas property interests | (24,008) | |||
Total costs and expenses | 56,770 | 21,025 | 104,597 | 75,901 |
Interest expense | 22,917 | |||
Loss from discontinued operations | $ (1,630) | $ (7,989) | $ (11,349) | $ (5,457) |
Notes Payable _ Related Parti_3
Notes Payable – Related Parties (Details) - USD ($) | 1 Months Ended | 9 Months Ended | ||||||||
Nov. 30, 2021 | Oct. 31, 2021 | Jun. 30, 2021 | Mar. 09, 2021 | Dec. 30, 2020 | Sep. 30, 2021 | Dec. 30, 2022 | Oct. 01, 2021 | Apr. 30, 2021 | Dec. 31, 2020 | |
Notes Payable – Related Parties (Details) [Line Items] | ||||||||||
Exchange of common shares (in Shares) | 1,000,000 | |||||||||
Converted into common shares (in Shares) | 618,660 | |||||||||
Subordinated Promissory note due date | Sep. 30, 2021 | |||||||||
Interest rate | 10.00% | |||||||||
Accrued interest | $ 28,508 | |||||||||
Accrued interest | 5,047 | $ 22,393 | ||||||||
Convertible debt | $ 620,000 | |||||||||
Bears interest | 10.00% | |||||||||
Conversion price (in Dollars per share) | $ 0.5 | |||||||||
New equity capital | $ 10,000,000 | |||||||||
Exercise price per share (in Dollars per share) | $ 0.6 | |||||||||
Restricted common shares (in Shares) | 20,000 | |||||||||
Warrant to purchase of common stock (in Shares) | 1,000,000 | |||||||||
Exercise price (in Dollars per share) | $ 0.352 | |||||||||
Amended, payments | $ 125,000 | |||||||||
Maturity date | due on January 31, 2022 and March 31, 2022 | |||||||||
Equity capital amount | $ 12.5 | |||||||||
Accrued interest | $ 18,733 | |||||||||
Subsequent Event [Member] | ||||||||||
Notes Payable – Related Parties (Details) [Line Items] | ||||||||||
Accrued interest | $ 250,000 | |||||||||
Extension fee (in Shares) | 20,000 | |||||||||
Accrued interest | $ 50,000 | |||||||||
Option exercisable | $250,000 | |||||||||
Exercise price per share (in Dollars per share) | $ 0.352 | |||||||||
Warrant to purchase of common stock (in Shares) | 500,000 | |||||||||
Subordinated Promissory Note [Member] | ||||||||||
Notes Payable – Related Parties (Details) [Line Items] | ||||||||||
Interest rate | 10.00% | |||||||||
Principal amount | $ 250,000 | |||||||||
Accrued and unpaid interest due date | Sep. 30, 2021 | |||||||||
Conventry Asset Management, LTD. [Member] | ||||||||||
Notes Payable – Related Parties (Details) [Line Items] | ||||||||||
Interest rate | 10.00% | |||||||||
Principal amount | $ 1,000,000 | $ 75,069 | ||||||||
Accredited Investor [Member] | ||||||||||
Notes Payable – Related Parties (Details) [Line Items] | ||||||||||
Principal amount | $ 500,000 |
Notes Payable _ Related Parti_4
Notes Payable – Related Parties (Details) - Schedule of notes payable related parties - USD ($) | 9 Months Ended | |
Sep. 30, 2021 | Dec. 31, 2020 | |
Notes Payable – Related Parties (Details) - Schedule of notes payable related parties [Line Items] | ||
Total | $ 2,360,000 | $ 3,698,874 |
Less debt discounts | (362,282) | |
Total Notes Payable – Related Parties | 2,360,000 | 3,336,592 |
Convertible Promissory Note to CEO | 620,000 | |
Senior Secured Promissory Note [Member] | ||
Notes Payable – Related Parties (Details) - Schedule of notes payable related parties [Line Items] | ||
Total | 1,500,000 | |
Convertible Promissory Note [Member] | ||
Notes Payable – Related Parties (Details) - Schedule of notes payable related parties [Line Items] | ||
Total | 208,874 | |
Subordinated Promissory Note to CEO [Member] | ||
Notes Payable – Related Parties (Details) - Schedule of notes payable related parties [Line Items] | ||
Total | 490,000 | 490,000 |
Secured Promissory Note to Coventry Asset Management, LTD. [Member] | ||
Notes Payable – Related Parties (Details) - Schedule of notes payable related parties [Line Items] | ||
Total | 1,000,000 | 1,000,000 |
Subordinated Promissory Note to Investor [Member] | ||
Notes Payable – Related Parties (Details) - Schedule of notes payable related parties [Line Items] | ||
Total | $ 250,000 | $ 500,000 |
Other Indebtedness (Details)
Other Indebtedness (Details) - USD ($) | Aug. 01, 2023 | Nov. 15, 2021 | Oct. 31, 2021 | Sep. 30, 2021 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 21, 2021 | Apr. 29, 2020 |
Other Indebtedness (Details) [Line Items] | ||||||||
Mortgage payable, description | The Company is obligated under a mortgage payable, dated September 15, 2014 and as amended October 1, 2019, secured by its warehouse property located in Denver, Colorado. The note provided for a 25-year amortization period and an initial interest rate of 9% annually. As amended, the note matured on January 15, 2021 but was extended under terms of the amendment to July 15, 2021 after payment by the Company of an extension fee of 1% of the then outstanding principal. The rate during this extension period was 11% annually.In July 2021, the mortgage payable was amended to a new maturity date of October 15, 2021. The Company made a $100,000 principal payment and paid an extension fee of $6,000 in July 2021 for this amendment. The rate during the extension period was increased to 12% annually and the new monthly payment is $5,279. | |||||||
Maturity date | Jan. 15, 2022 | |||||||
Extension fee | $ 1,000 | |||||||
Interest expenses | $ 5,500 | |||||||
Interest rate | 13.00% | |||||||
Nonpayroll expenses | 25.00% | |||||||
Compensation decreases percentage | 25.00% | |||||||
Compensation levels amount | $ 100,000 | |||||||
PPP loan amount | $ 25,200 | |||||||
Forecast [Member] | ||||||||
Other Indebtedness (Details) [Line Items] | ||||||||
Lease and rental expense | $ 7,500 | |||||||
Minimum future rents | $ 22,500 | |||||||
Minimum future rents twelve months | $ 90,000 | |||||||
Minimum future rents two years | $ 52,500 |
Other Indebtedness (Details) -
Other Indebtedness (Details) - Schedule of other indebtedness - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Schedule of other indebtedness [Abstract] | ||
Mortgage Payable | $ 516,359 | $ 619,461 |
Paycheck Protection Program Loan | 25,200 | |
Total | 516,359 | 644,661 |
Less current portion | (516,359) | (619,461) |
Total Other Indebtedness - Long-Term | $ 25,200 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) | Apr. 12, 2019 | Dec. 23, 2020 | Sep. 30, 2021 | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Commitments and Contingencies (Details) [Line Items] | |||||||
Lease monthly payments | $ 2,000 | ||||||
Lease expense | $ 6,000 | $ 16,000 | |||||
Incremental borrowing rate | 10.00% | ||||||
Cost of drying equipment total | $ 1,100,000 | ||||||
Insurance proceeds | $ 595,000 | ||||||
Fees Exceeding | $ 300,000 | ||||||
Amount of summary judgment | $ 230,712 | ||||||
Litigation settlement interest percentage | 5.00% | ||||||
Legal fees | $ 252,583 | ||||||
Oz Capital, LLC [Member] | |||||||
Commitments and Contingencies (Details) [Line Items] | |||||||
Lease monthly payments | 10,249 | ||||||
Lease expense | $ 30,747 | $ 88,604 | |||||
Lease expiration date | May 31, 2024 | ||||||
Grand Traverse Holdings, LLC [Member] | |||||||
Commitments and Contingencies (Details) [Line Items] | |||||||
Lease term | 61 months | ||||||
Interest and attorney fees | 823,504 | ||||||
Grand Traverse Holdings, LLC [Member] | John Gallegos [Member] | |||||||
Commitments and Contingencies (Details) [Line Items] | |||||||
Liable for the asserted damages | $ 1,000,000 |
Equity (Details)
Equity (Details) | 9 Months Ended |
Sep. 30, 2021USD ($)$ / sharesshares | |
Equity (Details) [Line Items] | |
Preferred stock description | The Company is authorized for 200 million shares of capital stock, par value $0.00001 per share and 20 million shares of preferred stock, par value $0.00001 per share. |
Exercisable warrants common stock shares (in Dollars per share) | $ / shares | $ 0.352 |
Sale of preferred stock units (in Dollars) | $ | $ 10,000 |
Aggregate gross proceeds (in Dollars) | $ | $ 1,350,000 |
Common stock shares Issued | 25,000 |
Equity description | For purposes of this automatic conversion of the Series B Preferred Stock, a “Qualifying Event” shall have occurred if (A) (1) the rolling five-trading day volume-weighted average trading price of shares of the common stock exceeds $1.00, and (2) there shall be an effective registration statement under the Securities Act of 1933, as amended covering all of the shares of common stock which would be issuable upon conversion of all of the outstanding shares of Series B Preferred Stock or (B) the Company closes a firm commitment underwriting of the common stock on a Form S-1 Registration Statement with aggregate gross proceeds of at least $5,000,000 at a price per share equal to or greater than $1.00. |
Warrant per share (in Dollars per share) | $ / shares | $ 0.0001 |
Weighted average price exceed (in Dollars per share) | $ / shares | $ 1 |
Shares of Common stock | 25,000 |
December 2020 Issuance of Series B Preferred Stock Units [Member] | |
Equity (Details) [Line Items] | |
Exercisable warrants common stock shares | 50,000 |
Common Stock [Member] | |
Equity (Details) [Line Items] | |
Equity description | At September 30, 2021, the Company had 111,070,329 common shares outstanding. Following is a discussion of common stock issuances during the periods presented: ● February 2020 Issuance of Common Stock Units – In February 2020, the Company issued 250,000 common units for $100,000. Each unit consisted of one share of common stock and a warrant for purchase of one common share for $0.40 per share. The warrant expires March 1, 2022 and contains certain anti-dilution provisions requiring a downward adjustment to the exercise price of the warrant if dilutive instruments are issued at prices less than the warrant exercise price. Proceeds of this issuance were used for general corporate purposes. The common stock issued in the exchange was valued using the trading price of the common stock on February 20, 2020. The warrants were valued at $45,848 using a binomial lattice valuation model using inputs as of the exchange date. Our expected volatility assumption was based on the historical volatility of the Company’s common stock (252%). The expected life assumption was based on the expiration date of the warrant (two years). The risk-free interest rate for the expected term of the warrant was based on the U.S. Treasury yield curve in effect at the time of measurement (1.39%). The warrants are classified within equity in the consolidated balance sheets. Under GAAP, the anti-dilution provisions will be accounted for if and when these provisions are triggered. ● Acquisition of Certain Assets of Halcyon – the Company issued 6,250,000 shares of common stock valued at $2.5 million (valued at $0.40 per share; restricted from trading for a period of up to one year) in the acquisition. Refer to Note 3. ● 2021 First Quarter Issuances of Common Stock Units – In the first quarter of 2021, the Company issued 800,000 common stock units for total proceeds of $400,000. Each common stock unit consists of one share of common stock and a warrant for the purchase of two shares of common stock for $0.50 each. Each warrant is exercisable any time before its expiration on the second anniversary of its issuance. The Company allocated the total proceeds based on the relative fair values of the common stock and warrants. The fair value of the warrants was determined using an options valuation model with key assumptions including a risk-free interest rate of 0.11% and historical volatility of 272%. A total of $263,293 was allocated to the warrants and reported in additional paid-in capital. ● Warrant Exercises – In the first quarter of 2021, the Company received $2,967,000 for the exercise of 8,428,976 outstanding warrants. ● Issuances for Exchange or Conversion of Debt – The Company issued a total of 1,618,660 common shares for the exchange or conversion of outstanding debt. Refer to Note 5. ● Issuance to Vendor for Services – In the third quarter of 2021, the Company issued 125,000 common shares to a vendor for services performed. ● Issuance for Extension of Secured Note – The Company issued 20,000 common shares as consideration to extend the maturity of a senior note in the third quarter of 2021. Refer to Note 5. ● Issuance for Conversion of Series A Preferred Stock – As noted above, in the third quarter of 2021, the Company issued 75,947,376 common shares for the conversion of all outstanding shares of its Series A Preferred Stock. ●Stock-based Compensation – The Company issued 500,000 restricted common shares as incentive compensation to two executives who joined the Company in the first quarter of 2021. |
Series A Preferred Stock [Member] | |
Equity (Details) [Line Items] | |
Shares of series A preferred stock | 6,328,948 |
Shares of common stock | 75,947,376 |
Series B Preferred Stock [Member] | |
Equity (Details) [Line Items] | |
Preferred stock converted into common stock | 25,000 |
Annual dividend rate | 6.00% |
Preferred stock stated value (in Dollars) | $ | $ 10,000 |
Annual rate, description | Initially, redemption payments of 12.5% each of the total amount of Series B Preferred Stock then outstanding plus accrued dividends were due from the Company to each Holder of Series B Preferred Stock at the end of each calendar quarter of 2021. The first required redemption payments totaling $137,500 were made in April 2021. |
Equity (Details) - Schedule of
Equity (Details) - Schedule of warrants outstanding | 9 Months Ended | |
Sep. 30, 2021$ / sharesshares | ||
Class of Warrant or Right [Line Items] | ||
Number of warrants | shares | 16,159,656 | |
Exercise Price (each) | $ / shares | $ 0.6 | |
Issued in December 2020 [Member] | Subordinated Note to Investor [Member] | ||
Class of Warrant or Right [Line Items] | ||
Number of warrants | shares | 500,000 | [1] |
Exercise Price (each) | $ / shares | $ 0.352 | [1] |
Expiration Date | December 30, 2022 | [1] |
Method of Exercise | Cash | [1] |
Common Stock Units [Member] | Issued in February 2020 [Member] | ||
Class of Warrant or Right [Line Items] | ||
Number of warrants | shares | 250,000 | [2] |
Exercise Price (each) | $ / shares | $ 0.4 | [2] |
Expiration Date | March 1, 2022 | [2] |
Method of Exercise | Cash | [2] |
Common Stock Unites [Member] | March Two Thousand Twenty One [Member] | ||
Class of Warrant or Right [Line Items] | ||
Number of warrants | shares | 1,600,000 | [1] |
Exercise Price (each) | $ / shares | $ 0.5 | [1] |
Expiration Date | Jan-Feb, 2023 | [1] |
Method of Exercise | Cash | [1] |
Series C Preferred Stock [Member] | Issued upon exchange of EHR [Member] | ||
Class of Warrant or Right [Line Items] | ||
Number of warrants | shares | 1,065,340 | [1] |
Exercise Price (each) | $ / shares | $ 0.352 | [1] |
Expiration Date | November 27, 2021 | [1] |
Method of Exercise | Cash | [1] |
Series C Preferred Stock [Member] | Issued upon exchange of EHR One [Member] | ||
Class of Warrant or Right [Line Items] | ||
Number of warrants | shares | 7,244,316 | [1] |
Exercise Price (each) | $ / shares | $ 0.352 | [1] |
Expiration Date | November 27, 2021 | [1] |
Method of Exercise | Cashless | [1] |
Series B Preferred Units [Member] | Issued in December 2020 [Member] | ||
Class of Warrant or Right [Line Items] | ||
Number of warrants | shares | 5,500,000 | [1] |
Exercise Price (each) | $ / shares | $ 0.352 | [1] |
Expiration Date | December 30, 2022 | [1] |
Method of Exercise | Cash | [1] |
[1] | May be redeemed for $0.0001 per warrant at the Company’s option with 30 days advanced notice should the weighted average market price of common stock exceed $1.00 for any five out of seven consecutive trading days with a minimum average daily trading volume for such seven-day period of at least 25,000 shares of common stock. | |
[2] | Contains certain anti-dilution provisions requiring a downward adjustment to the exercise price of the warrant if dilutive instruments are issued at prices less than the warrant exercise price. |
Equity (Details) - Schedule o_2
Equity (Details) - Schedule of outstanding stock warrants activity - shares | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Schedule of outstanding stock warrants activity [Abstract] | ||
Warrants, beginning | 22,988,632 | 14,488,632 |
Issued | 1,600,000 | 250,000 |
Exercised | (8,428,976) | |
Warrants, ending | 16,159,656 | 14,738,632 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2021 | Apr. 06, 2021 | |
Stock-Based Compensation (Details) [Line Items] | ||||
Diluted common shares outstanding percentage | 20.00% | |||
Compensation expense related to awards | $ 38,750 | $ 119,750 | ||
Total unrecognized compensation cost | $ 38,750 | |||
Purchase of common stock | $ 750,000 | |||
2021 Plan [Member] | ||||
Stock-Based Compensation (Details) [Line Items] | ||||
common stock for issuance (in Shares) | 15,000,000 | |||
Number of shares (in Shares) | 15,000,000 | |||
Diluted common shares outstanding percentage | 13.10% | |||
Restricted Stock [Member] | ||||
Stock-Based Compensation (Details) [Line Items] | ||||
Restricted shares, issued (in Shares) | 500,000 | |||
Restricted shares, value | $ 158,500 |
Supplemental Cash Flow Inform_3
Supplemental Cash Flow Information (Details) - Schedule of supplemental cash flow information - USD ($) | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Schedule of supplemental cash flow information [Abstract] | ||
Cash paid for interest | $ 127,812 | |
Cash paid for taxes | ||
Acquisition of certain assets of Halcyon Thruput, LLC | ||
- issuance of common shares | 2,500,000 | |
- issuance of subordinated note | 850,000 | |
- assumption of Halcyon bank note | 995,614 | |
Series B preferred stock dividend payable | 39,137 | |
Issuance of common stock units previously subscribed | 50,000 | |
Issuances of common shares for exchange or conversion of debt | $ 2,160,269 |
Earnings (Loss) Per Share (Deta
Earnings (Loss) Per Share (Details) - Schedule of earnings (loss) per basic and diluted share - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Numerator | ||||
Loss from continuing operations attributable to common stockholders (in Dollars) | $ (1,376,030) | $ (171,367) | $ (4,356,315) | $ (1,146,592) |
Loss from discontinued operations (in Dollars) | (1,528) | (7,489) | (10,639) | (5,115) |
Less: preferred stock dividends (in Dollars) | (16,125) | (56,625) | ||
Net loss attributable to common stockholders (in Dollars) | $ (1,393,683) | $ (178,856) | $ (4,423,579) | $ (1,151,707) |
Denominator | ||||
Weighted average shares used to compute basic EPS (in Shares) | 54,109,797 | 17,380,317 | 38,693,679 | 17,500,308 |
Dilutive effect of convertible note (in Shares) | ||||
Dilutive effect of preferred stock (in Shares) | 59,913,657 | 75,947,376 | 72,641,084 | 75,947,376 |
Dilutive effect of common stock warrants (in Shares) | 9,042,419 | 11,126,327 | ||
Weighted average shares used to compute diluted EPS (in Shares) | 123,065,873 | 93,327,693 | 122,461,090 | 93,447,684 |
Loss from continuing operations | ||||
Basic | $ (0.03) | $ (0.01) | $ (0.11) | $ (0.07) |
Diluted | (0.03) | (0.01) | (0.11) | (0.07) |
(Loss) income from discontinued operations | ||||
Basic | ||||
Diluted | ||||
Earnings (loss) per share | ||||
Basic | (0.03) | (0.01) | (0.11) | (0.07) |
Diluted | $ (0.03) | $ (0.01) | $ (0.11) | $ (0.07) |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | 1 Months Ended | 9 Months Ended |
Oct. 31, 2021 | Sep. 30, 2021 | |
Subsequent Events (Details) [Line Items] | ||
Common stock per share (in Dollars per share) | $ 0.0001 | |
Subsequent event, description | As disclosed in Note 5 above, (i) we amended the subordinated note to our CEO in the amount of $490,000 to a new maturity date of January 31, 2022, (ii) we amended the secured promissory note to Coventry Asset Management, LTD. to a new maturity date of January 31, 2022 with an earlier maturity date of December 31, 2021 in the event of a new equity capital raise is completed and granted the holder a limited option to convert part of the principal to common stock and (iii) we amended the subordinated promissory note with an investor to a new maturity date of March 31, 2022 with an earlier maturity date of December 31, 2021 in the event of a new equity capital raise is completed. | |
Interest Rate | 10.00% | |
Maturity date | Jan. 1, 2022 | |
Subsequent Event [Member] | ||
Subsequent Events (Details) [Line Items] | ||
Common stock units (in Shares) | 416,667 | |
Investor total proceeds | $ 250,000 | |
Common stock per share (in Dollars per share) | $ 0.6 | |
Advanced | $ 15,000 | |
Convertible promissory note | $ 635,000 |