| NOTES PAYABLE | 10. NOTES PAYABLE As
of March 26, 2022 and June 26, 2021, notes payable consist of the following:
Schedule of notes payable
March 26, June 26,
2021 2021
Financing liability incurred on various dates between January 2019 through September 2019 with implied interest rates ranging from 0.7% to 17.0% per annum. $ 72,300 $ 72,300
Non-revolving, senior secured term notes dated between October 1, 2018 and October 30, 2020, issued to accredited investors, which mature on August 1, 2022 and July 31, 2022, and bear interest at a rate of 15.5% and 18.0% per annum. 95,500 109,318
Convertible debentures dated between
September 16, 2020 through January 29, 2021, issued to accredited investors and qualified institutional buyers, which mature two
years from issuance, and bear interest at a rate of 7.5% per annum. - 2,500
Promissory notes dated between January 15, 2019 through March 29, 2019, issued for deferred payments on acquisitions, which mature on varying dates from July 31, 2021 to April 1, 2022 and bear interest at rates ranging from 8.0% to 9.0% per annum. 2,148 2,204
Promissory notes dated November 7, 2018, issued to Lessor for tenant improvements as part of sales and leaseback transactions, which mature on November 7, 2028, bear interest at a rate of 10.0% per annum and require minimum monthly payments of $15,660 and $18,471. 2,083 2,196
Other 16 16
Total Notes Payable 172,047 188,534
Less Unamortized Debt Issuance Costs and Loan Origination Fees (782 ) (8,519 )
Net Amount $ 171,265 $ 180,015
Less Current Portion of Notes Payable (96,867 ) (103,496 )
Notes Payable, Net of Current Portion $ 74,398 $ 76,519 A
reconciliation of the beginning and ending balances of notes payable for the nine months ended March 26, 2022 is as follows:
Schedule of Reconciliation of Notes payable
March 26,
2022
Balance at Beginning of Period $ 180,015
Cash Additions 5,000
Debt Discount Recognized on Modifications (1,000 )
Paid-In-Kind Interest Capitalized 6,034
Cash Payments (20,153 )
Conversion of Convertible Debentures (2,371 )
Derivative Liability Incurred on Settlement of Debt (3,145 )
Shares Issued to Settle Debt (4,030 )
Non-Cash Loss on Extinguishment of Debt 2,176
Accretion of Debt Discount 3,556
Accretion of Debt Discount Included in Discontinued Operations 5,183
Balance at End of Period 171,265
Less Current Portion of Notes Payable (96,867 )
Notes Payable, Net of Current Portion $ 74,398 Non-Revolving
Senior Secured Term Loan Facility On
October 1, 2018, the Company closed a $ 73,275 77,675 7.5 Additionally,
MM CAN issued to the Lenders 8,105,642 4.97 511,628 4.73 In
addition to providing a portion of the Facility, Stable Road Capital provided advisory services to the Company. Advisory services included
introducing the Company to brands and various service providers, advice on the Facility and providing advice with respect to the Company’s
planned structured sale of real estate assets. For its advisory services, MM CAN issued to Stable Road Capital 8,105,642 4.73 On
January 13, 2020, the Company completed an amendment of the Facility wherein the maturity date was extended from October 1, 2020 to January
31, 2022 and the interest rate was increased from a fixed rate of 7.5 15.5 100 Modifications
and Extinguishments Further,
the Company cancelled the existing 16,211,284 1,023,256 4.97 4.73 40,455,729 0.60 Derivatives and Hedging Note 13 – Share-Based Compensation On
July 2, 2020, the Company completed an amendment of the Facility wherein the entirety of the interest at a rate of 15.5 The
Company incurred an amendment fee of $ 834 20,227,863 0.34 20,227,863 0.60 Note 13 – Share-Based Compensation On
September 16, 2020, the Company entered into further amendments wherein the amount of funds available under the Facility was increased
by $ 12,000 5,700 The additional amounts are funded through incremental
term loans at an interest rate of 18.0% per annum wherein 12.0% shall be paid in cash monthly in arrears and 6.0% shall accrue monthly
as payment-in-kind. In connection with each incremental draw under the amended Facility, the Company shall issue warrants equal to 200%
of the incremental term loan amount, divided by the greater of (a) $0.20 per share and (b) 115% multiplied by the volume-weighted average
trading price (“VWAP”) of the shares for the five consecutive trading days ending on the trading day immediately prior to
the applicable funding date of the second tranche, which shall be the exercise price of the issued warrant Note 11 – Senior Secured Convertible Credit Facility 20,227,863 0.34 20,227,863 0.60 On
September 16, 2020, the Company closed on an incremental term loan of $ 3,000 30,000,000 7,705 77,052,790 0.20 Note
12 – Shareholders’ Equity Note 13 – Share-Based Compensation On
September 16, 2020 and September 28, 2020, the down round feature on the warrants issued in connection with the incremental term loan
of $ 3,000 0.17 0.15 405 On
May 11, 2021, the Company completed an amendment of the Facility wherein certain covenants were added and amended. Specifically, the
minimum liquidity covenant was amended to which the covenant will not apply if the Company pays and has paid the cash portion of interest
accrued under the Facility when such cash interest becomes due and payable. Such covenant will continue to be applied in the event the
Company has failed to make payments. The minimum liquidity balance was not amended. In addition, application of payments was added wherein
proceeds from the sale of the New York disposal group shall be applied to the amended and restated Facility as of the amendment on July
2, 2020 in the principal amount of $ 83,123 1,000 On
February 2, 2022, the Company executed the Sixth Modification extending the stated maturity date of January 31, 2022 of the Facility
for a period of six months; specifically, July 31, 2022 with respect to Facility, and August 1, 2022 with respect to the incremental
term loans (collectively, the “Term Loans”). The Sixth Modification makes no modification to the current interest rate. The
Sixth Modification provides that the definitive documentation with respect to the conditional purchase of the Term Loans by Superhero
Acquisition, L.P., an existing lender under the Company’s Senior Secured Convertible Purchase Agreement dated August 7, 2021, must
be entered within 45 days or the stated maturity date of the Term Loans become due. The Sixth Modification requires that the Company
make a mandatory prepayment of at least $ 37,500 20,000 1,000 Term Loan lenders in consideration of the Sixth Modification, which fee will
be paid in Class B Subordinate Voting Shares (“Shares”) with a deemed price of $0.1247 (C$0.1582) for a total of 8,021,593
Shares (the “Fee Shares”), with any difference in realized net proceeds that is less than $1,000 from the sale of the Fee
Shares during a 30-day period, to the extent such Fee Shares are sold, reimbursed in cash. The
issuance of the Fee Shares as part of the Sixth Modification triggered the right of holders of convertible notes under the
Convertible Facility to be issued 6,682,567 one Share at a purchase price of $0.1247 (C$0.1582), were issued to the holders of convertible notes under the Convertible
Facility. Note 8 – Derivative Liabilities Note 11 – Senior Secured
Convertible Credit Facility Unsecured
Convertible Facility On
June 28, 2021, the remaining principal amount of the unsecured convertible debenture facility of $ 2,500 16,014,664 2,008 8,807,605 1,622 Unsecured
Promissory Note On
July 29, 2021, the Company entered into a short-term unsecured promissory note in the amount of $ 5,000 6.0 In
connection with the equity investment on August 17, 2021, the Company settled the promissory note by the issuance of 20,833,333 units,
consisting of 20,833,333 Subordinate Voting Shares and 5,208,333 warrants, based on an issue price of $0.24 and the relative portion
of the Short-Term Warrant. Note 12 – Shareholders’ Equity 4,030 3,146 2,176 |
