Cover
Cover - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Apr. 12, 2021 | Jun. 30, 2020 | |
Cover [Abstract] | |||
Entity Registrant Name | ETHEMA HEALTH Corp | ||
Entity Central Index Key | 0000792935 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2020 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity a Well-known Seasoned Issuer | No | ||
Entity a Voluntary Filer | No | ||
Entity's Reporting Status Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | false | ||
Entity Shell Company | false | ||
Entity Interactive Data Current | Yes | ||
Entity Incorporation, State or Country Code | CO | ||
Entity File Number | 000-15078 | ||
Entity Public Float | $ 2,822,837 | ||
Entity Common Stock, Shares Outstanding | 2,269,849,130 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2020 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets | ||
Cash | $ 90,500 | $ 2,975 |
Accounts receivable, net | 3,075 | 105,842 |
Prepaid expenses | 19,190 | 26,625 |
Other current assets | 131,938 | 120,000 |
Other investments | 690,449 | |
Total current assets | 935,152 | 255,442 |
Non-current assets | ||
Due on sale of subsidiary | 5,094 | 4,969 |
Property and equipment | 2,882,220 | 2,950,668 |
Total non-current assets | 2,887,314 | 2,955,637 |
Total assets | 3,822,466 | 3,211,079 |
Current liabilities | ||
Bank overdraft | 11,079 | |
Accounts payable and accrued liabilities | 833,615 | 1,022,175 |
Taxes payable | 850,277 | 792,915 |
Convertible loans, net of discounts | 4,200,217 | 5,041,113 |
Short term loans | 115,375 | 106,934 |
Mortgage loans | 115,704 | 114,290 |
Government assistance loans | 156,782 | |
Derivative liability | 4,765,387 | 8,694,272 |
Accrued dividends | 15,594 | |
Related party payables | 2,811,849 | 2,793,080 |
Total current liabilities | 13,864,800 | 18,575,858 |
Non-current liabilities | ||
Government assistance loans | 31,417 | |
Third party loans | 704,271 | 774,820 |
Mortgage loans, net of current portion | 3,848,077 | 3,880,945 |
Total non-current liabilities | 4,583,765 | 4,655,765 |
Total liabilities | 18,448,565 | 23,231,623 |
Stockholders' deficit | ||
Preferred stock - Series A; $0.01 par value, 10,000,000 authorized, 4,000,000 and 0 outstanding at December 31, 2020 and 2019, respectively | 40,000 | |
Preferred stock - Series B; $0.01 par value, 10,000,000 authorized, 400,000 and 0 outstanding as of December 31, 2020 and 2019, respectively. | 400,000 | |
Common stock - $0.0001 par value, 10,000,000,000 shares authorized; 2,207,085,665 and 155,483,897 shares issued and outstanding as of December 31, 2020 and December 31, 2019. | 20,270,857 | 1,554,838 |
Additional paid-in capital | 23,344,885 | 23,188,527 |
Discount for shares issued below par value | (17,728,779) | |
Accumulated other comprehensive income | 806,719 | 727,976 |
Accumulated deficit | (42,459,781) | (45,491,885) |
Total stockholders' deficit | (15,726,099) | (20,020,544) |
Minority shareholders interest | 700,000 | |
Total stockholders’ deficit | (15,026,099) | (20,020,544) |
Total liabilities and stockholders' deficit | $ 3,822,466 | $ 3,211,079 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, authorized | 10,000,000,000 | 10,000,000,000 |
Common stock, issued | 2,207,085,665 | 155,483,897 |
Common stock, outstanding | 2,207,085,665 | 155,483,897 |
Preferred stock, seriea A, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, series A shares, authorized | 10,000,000 | 10,000,000 |
Preferred stock, series A shares, issued | 4,000,000 | 0 |
Preferred stock, series A shares, outstanding | 4,000,000 | 0 |
Preferred stock, series B, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, series B shares, authorized | 400,000 | 10,000,000 |
Preferred stock, series B shares, issued | 400,000 | 0 |
Preferred stock, series B shares, outstanding | 400,000 | 0 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Income Statement [Abstract] | ||
Revenues | $ 338,996 | $ 359,947 |
Operating expenses | ||
General and administrative | 55,756 | 909,613 |
Rental expense | 5,512 | 1,360,117 |
Professional fees | 231,264 | 550,624 |
Salaries and wages | 88,532 | 1,279,796 |
Depreciation expense | 121,276 | 217,018 |
Impairment expense | 242,514 | |
Total operating expenses | 502,340 | 4,559,682 |
Operating loss | (163,344) | (4,199,735) |
Other Income (expense) | ||
Other income | 1,183 | 6,600 |
Gain on debt extinguishment | 12,601,823 | |
Profit (loss) on sale of assets | 36,470 | (1,019,812) |
Warrants exercised | (95,868) | |
Penalty on convertible notes | (569,628) | |
Loss on conversion of convertible debentures | (585,351) | (203,981) |
Deposit forfeited | (1,665,078) | |
Interest income | 629 | 17,226 |
Interest expense | (631,425) | (1,079,038) |
Debt discount | (861,657) | (3,338,760) |
Derivative liability movement | (7,041,968) | (2,599,029) |
Foreign exchange movements | (175,500) | (311,606) |
Net income (loss) before taxation | 3,084,992 | (14,962,841) |
Taxation | ||
Net income (loss) | 3,084,992 | (14,962,841) |
Preferred stock dividend | (52,888) | |
Net income (loss) available to ordinary shareholders | 3,032,104 | (14,962,841) |
Accumulated other comprehensive income (loss) | ||
Foreign currency translation adjustment | 78,743 | 97,565 |
Total comprehensive loss | $ 3,110,847 | $ (14,865,276) |
Basic and diluted loss per common share | $ 0 | $ (0.11) |
Weighted average common shares outstanding - Basic | 1,594,016,327 | 136,165,798 |
Weighted average common shares outstanding - Diluted | 2,045,373,732 | 136,165,798 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT - USD ($) | Preferred Stock A | Common Stock [Member] | Additional Paid in Capital [Member] | Discount To Par Value | Comprehensive Income [Member] | Accumulated Deficit [Member] | Minority Shareholders Interest | Total |
Beginning Balance, Value at Dec. 31, 2018 | $ 1,243,003 | $ 20,939,677 | $ 630,411 | $ (30,529,044) | $ (7,715,953) | |||
Beginning Balance, Shares at Dec. 31, 2018 | 124,300,341 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Fair value of warrants issued | 1,320,497 | 1,320,497 | ||||||
Shares issued for commitment fee, Amount | $ 711 | 4,267 | 4,978 | |||||
Shares issued for commitment fee, Shares | 71,111 | |||||||
Conversion of convertible notes, Amount | $ 237,624 | 815,949 | 1,053,573 | |||||
Conversion of convertible notes, Shares | 23,762,445 | |||||||
Bonus shares issued to investors, Amount | $ 20,500 | 123,000 | 143,500 | |||||
Bonus shares issued to investors, Shares | 2,050,000 | |||||||
Shares based compensation, Amount | $ 53,000 | 318,000 | 371,000 | |||||
Shares based compensation, Shares | 5,300,000 | |||||||
Cancelation of shares, Amount | (332,863) | (332,863) | ||||||
Foreign currency translation | 97,565 | 97,565 | ||||||
Net income | (14,962,841) | (14,962,841) | ||||||
Ending Balance, Value at Dec. 31, 2019 | $ 1,554,838 | 23,188,527 | 727,976 | (45,491,885) | (20,020,544) | |||
Ending Balance, Shares at Dec. 31, 2019 | 155,483,897 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Shares issued for commitment fee, Amount | $ 27,000 | 138,780 | 165,780 | |||||
Shares issued for commitment fee, Shares | 2,700,000 | |||||||
Warrants exercised, Amount | $ 1,840,000 | $ (1,744,132) | 95,868 | |||||
Warrants exercised, Shares | 184,000,000 | |||||||
Conversion of convertible notes, Amount | $ 15,866,597 | (14,729,336) | 1,137,261 | |||||
Conversion of convertible notes, Shares | 1,586,659,618 | |||||||
Settlement of liabilities, Amount | $ 1,000,000 | (1,255,311) | $ 700,000 | 444,689 | ||||
Settlement of liabilities, Shares | 100,000,000 | |||||||
Settlement of liabilities, related party, Amount | $ 40,000 | 40,000 | ||||||
Settlement of liabilities, related party, Shares | 4,000,000 | |||||||
Cancelation of shares, Amount | $ (17,578) | 17,578 | ||||||
Cancelation of shares, Shares | (1,757,850) | |||||||
Foreign currency translation | 78,743 | 78,743 | ||||||
Net income | 3,084,992 | 3,084,992 | ||||||
Dividends accrued | (52,888) | (52,888) | ||||||
Ending Balance, Value at Dec. 31, 2020 | $ 40,000 | $ 20,270,857 | $ 23,344,885 | $ (17,728,779) | $ 806,719 | $ (42,459,781) | $ 700,000 | $ (15,726,099) |
Ending Balance, Shares at Dec. 31, 2020 | 4,000,000 | 2,027,085,665 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Operating activities | ||
Net income (loss) | $ 3,084,992 | $ (14,962,841) |
Adjustment to reconcile net income (loss) to net cash used in operating activities: | ||
Depreciation expense | 121,276 | 217,018 |
Gain on debt extinguishment | (12,601,823) | |
Impairment expense | 242,514 | |
Penalty on convertible debt | 410,868 | |
Deposit forfeited | 1,665,078 | |
(Gain) Loss on disposal of property | (36,470) | 1,019,812 |
Loss on convertible debt conversion | 585,350 | 60,481 |
Bonus shares issued to investors | 143,500 | |
Stock based compensation for services | 165,780 | 375,978 |
Amortization of debt discount | 861,657 | 3,338,760 |
Derivative liability movements | 7,041,968 | 2,599,029 |
Non-cash interest income | (23) | (17,193) |
Exercise of warrants | 95,868 | |
Unrealized foreign exchange loss | 141,927 | |
Movement in bad debt reserve | (2,734) | (308,690) |
Changes in operating assets and liabilities | ||
Accounts receivable | 105,561 | 405,566 |
Prepaid expenses | 1,521 | 121,252 |
Other current assets | (11,938) | |
Escrow receivable | 395,159 | |
Accounts payable and accrued liabilities | 301,035 | 1,398,171 |
Taxes payable | 44,083 | |
Net cash used in operating activities | (101,970) | (2,895,538) |
Investing activities | ||
Proceeds on disposal of property, net of closing costs of $182,344 | 4,756,360 | |
Investment in promissory note | 120,000 | |
Deposits refunded | 5,995 | 15,591 |
Other investments | (690,449) | |
Purchase of fixed assets | (95,254) | |
Net cash generated by (used in) investing activities | (684,454) | 4,556,697 |
Financing activities | ||
Increase in bank overdraft | 11,079 | |
Decrease in bank overdraft | (11,079) | |
Repayment of mortgage | (105,952) | (3,067,073) |
Proceeds from convertible notes | 1,129,050 | 2,906,144 |
Repayment of convertible notes | (210,600) | (2,441,464) |
Proceeds from promissory notes | 907,170 | |
Proceeds from government assistance loans | 186,600 | |
Preferred stock dividends paid | (37,818) | |
Repayment of promissory notes | (150,583) | (63,231) |
Proceeds (repayment) from related party notes | 54,401 | (203,660) |
Net cash provided by (used in) financing activities | 854,019 | (1,951,035) |
Effect of exchange rate on cash | 19,930 | 268,177 |
Net change in cash | 87,525 | (21,699) |
Beginning cash balance | 2,975 | 24,674 |
Ending cash balance | 90,500 | 2,975 |
Supplemental cash flow information | ||
Cash paid for interest | 180,668 | 542,582 |
Cash paid for income taxes | ||
Non cash investing and financing activities | ||
Conversion of debt to equity | 1,137,261 | 1,053,573 |
Conversion of related party payable to common stock | 25,000 | |
Conversion of related party payable to Series A Preferred stock | 40,000 | |
Settlement of liabilities | 844,689 | |
Fair value of warrants issued | $ 1,320,497 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Statement of Cash Flows [Abstract] | ||
Proceeds on disposal of property | $ 182,344 | $ 182,344 |
Nature of business
Nature of business | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of business | 1. Nature of business Ethema Health Corporation (the “Company”) was incorporated under the laws of the state of Colorado, USA, on April 1, 1993. Effective April 4, 2017, the Company changed its name to Ethema Health Corporation and prior to that, on May 2012, the Company had changed its name to GreeneStone Healthcare Corporation from Nova Natural Resources Corporation. As of December 31, 2017, the Company owned 100% of the outstanding shares of GreeneStone Clinic Muskoka Inc., incorporated in 2010 under the laws of the Province of Ontario, Canada; Cranberry Cove Holdings Ltd., incorporated on January 9, 2004 under the laws of the Province of Ontario, Canada; Addiction Recovery Institute of America (“ARIA”) (formerly Seastone Delray Healthcare, LLC), incorporated on May 17, 2016 under the laws of Florida, USA; and Delray Andrews RE, LLC, incorporated on May 17, 2016 under the laws of Florida, USA. During December 2016, the Company obtained a license to operate and provide addiction treatment healthcare services in Florida, USA. The company commenced operations under this license with effect from January 2017. On February 14, 2017, the Company completed a series of transactions (referred to collectively as the “Restructuring Transactions”), including a Share Purchase Agreement (the “SPA”) whereby the Company acquired 100% of the stock of CCH, which holds the real estate on which the Company previously operated a rehabilitation clinic (“the Canadian Rehab Clinic”). The Company entered into an Asset Purchase Agreement (the “APA”) and lease (the “Lease”) whereby the Company sold all of the Canadian Rehab Clinic business assets and leased the real estate to the buyer. Simultaneously with this transaction, the Company entered into a Real Estate Purchase agreement and Asset Purchase Agreement whereby the Company purchased the real estate and business assets of Seastone Delray (the “Florida Purchase”). The Share Purchase Agreement Under the SPA, The Asset Purchase Agreement and Lease Under the APA, the assets of the Canadian Rehab Clinic were sold by the Company, through its subsidiary, GreeneStone Clinic Muskoka Inc. (“Muskoka”), to Canadian Addiction Residential Treatment LP (the “Purchaser”), for a total consideration of CDN$10,000,000. The proceeds of the Muskoka clinic asset sale were used to pay down certain tax debts and operational costs of the Company and to fund the Florida Purchase, mentioned below. Through the APA, substantially all of the assets of the Canadian Rehab Clinic were sold, leaving Ethema with only the underlying clinic real estate, which the Company, through its newly acquired subsidiary, CCH, concurrently leased to the Purchaser. The Lease is a triple net lease and provides for a five (5) year primary term with three (3) five-year renewal options, annual base rent for the first year at CDN$420,000 with annual increases, an option to tenant to purchase the leased premises and certain first refusal rights. The Florida Purchase Immediately after closing on the sale of the assets of the Canadian Rehab Clinic, the Company closed on the acquisition of the real estate assets of Seastone Delray pursuant to certain real estate and asset purchase agreements The purchase price for the Seastone assets was US$6,070,000, financed with a purchase money mortgage of US$3,000,000, and US$3,070,000 in cash. On April 2, 2019, the Company disposed of the real property located at 801 Andrews Avenue, Delray Beach for gross proceeds of $3,500,000. Since June 30, 2020, the Company has been actively involved in the operation of the treatment center operated by Evernia Health Center LLC (“Evernia”) at 950 Evernia Street, West Palm Beach Florida. The Company is under contract to purchase a majority interest in this company and has been financing the start up operations of this facility. This operation will be the Company’s only treatment center operating and expects the purchase of the majority interest to close in the second quarter of 2021. |
Summary of significant accounti
Summary of significant accounting policies | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Summary of significant accounting policies | 2. Summary of significant accounting policies Financial Reporting The Company prepares its consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“US GAAP”). Management further acknowledges that it is solely responsible for adopting sound accounting practices, establishing and maintaining a system of internal accounting control and preventing and detecting fraud. The Company’s system of internal accounting control is designed to assure, among other items, that i) recorded transactions are valid; ii) valid transactions are recorded; and iii) transactions are recorded in the proper period in a timely manner to produce financial statements which present fairly the financial condition, results of operations and cash flows of the Company for the respective periods being presented. a) Use of Estimates The preparation of consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. b) Principals of consolidation and foreign currency translation The accompanying consolidated financial statements include the accounts of the Company and all of its subsidiaries. All intercompany transactions and balances have been eliminated on consolidation. Certain of the Company’s subsidiaries functional currency is the Canadian dollar, while the Company’s reporting currency is the U.S. dollar. All transactions initiated in Canadian dollars are translated into US dollars in accordance with ASC 830, “Foreign Currency Translation” as follows: ● Monetary assets and liabilities at the rate of exchange in effect at the balance sheet date. ● Non-monetary, non-current and equity at historical rates. ● Revenue and expense items and cash flows at the average rate of exchange prevailing during the period. Adjustments arising from such translations are deferred until realization and are included as a separate component of stockholders’ deficit as a component of accumulated other comprehensive income or loss. Therefore, translation adjustments are not included in determining net income (loss) but reported as other comprehensive income (loss). For foreign currency transactions, the Company translates these amounts to the Company’s functional currency at the exchange rate effective on the invoice date. If the exchange rate changes between the time of purchase and the time actual payment is made, a foreign exchange transaction gain or loss results which is included in determining net income for the period. The relevant translation rates are as follows: For the year ended December 31, 2020 a closing rate of CDN$1.0000 equals US$0.7854 and an average exchange rate of CDN$1.0000 equals US$0.7455. For the year ended December 31, 2019 a closing rate of CAD$1.0000 equals US$0.7699 and an average exchange rate of CAD$1.0000 equals US$0.7536. c) Revenue Recognition ASC 606 requires companies to exercise more judgment and recognize revenue using a five-step process. The Company’s provision for doubtful accounts are recorded as a direct reduction to revenue instead of being presented as a separate line item on the consolidated statements of operations and comprehensive loss. As our performance obligations relate to contracts with a duration of one year or less, the Company elected the optional exemption in ASC 606-10-50-14(a). Therefore, the Company is not required to disclose the transaction price for the remaining performance obligations at the end of the reporting period or when the Company expects to recognize the revenue. The Company has minimal unsatisfied performance obligations at the end of the reporting period as our patients typically are under no obligation to remain admitted in our facilities. The Company receives payments from the following sources for services rendered in our U.S. Facility: (i) commercial insurers; and (ii) individual patients and clients. As the period between the time of service and time of payment is typically one year or less, the Company elected the practical expedient under ASC 606-10-32-18 and does not adjust for the effects of a significant financing component. The Company derives a significant portion of its revenue from other payors that receive discounts from established billing rates. The various managed care contracts under which these discounts must be calculated are complex, subject to interpretation and adjustment, and may include multiple reimbursement mechanisms for different types of services provided in the Company’s inpatient facilities and cost settlement provisions. Management estimates the transaction price on a payor-specific basis given its interpretation of the applicable regulations or contract terms. The services authorized and provided and related reimbursement are often subject to interpretation that could result in payments that differ from the Company’s estimates. Additionally, updated regulations and contract renegotiations occur frequently, necessitating regular review and assessment of the estimation process by management. Settlements with third-party payors are estimated and recorded in the period in which the related services are rendered and are adjusted in future periods as final settlements are determined. In the opinion of management, adequate provision has been made for any adjustments and final settlements. However, there can be no assurance that any such adjustments and final settlements will not have a material effect on the Company’s financial condition or results of operations. The Company’s receivables were $3,075 and $105,842 for the years ended December 31, 2020 and 2019, respectively. Management believes that these receivables are properly stated and are not likely to be settled for a significantly different amount. The net adjustments to estimated settlements resulted in a a credit to revenues of $2,734 and a charge to revenues of $414,603 for the years ended December 31, 2020 and 2019, respectively. The credit to revenue is due to revenue collected from commercial insurers in excess of our expectations. The Company’s revenues are recognized when control of the promised goods or services are transferred to a customer, in an amount that reflects the consideration that the Company expects to receive in exchange for those services. The Company derives its revenues from the sale of its services. The Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its revenue transactions: i. identify the contract with a customer; ii. identify the performance obligations in the contract; iii. determine the transaction price; iv. allocate the transaction price to performance obligations in the contract; and v. recognize revenue as the performance obligation is satisfied. d) Cash and cash equivalents For purposes of the statements of cash flows, the Company considers all highly liquid instruments purchased with a maturity of three months or less and money market accounts to be cash equivalents. The Company maintains cash and cash equivalents with several financial institution in the USA and Canada. The Company primarily places cash balances in the USA with high-credit quality financial institutions located in the United States which are insured by the Federal Deposit Insurance Corporation up to a limit of $250,000 per institution, in Canada which are insured by the Canadian Deposit Insurance Corporation up to a limit of CDN$100,000 per institution. e) Accounts receivable Accounts receivable primarily consists of amounts due from third-party payors (non-governmental) and private pay patients and is recorded net of allowances for doubtful accounts and contractual discounts. The Company’s ability to collect outstanding receivables is critical to its results of operations and cash flows. Accordingly, accounts receivable reported in the Company’s consolidated financial statements is recorded at the net amount expected to be received. The Company’s primary collection risks are (i) the risk of overestimating net revenues at the time of billing that may result in the Company receiving less than the recorded receivable, (ii) the risk of non-payment as a result of commercial insurance companies denying claims, (iii) the risk that patients will fail to remit insurance payments to the Company when the commercial insurance company pays out-of-network claims directly to the patient, (iv) resource and capacity constraints that may prevent the Company from handling the volume of billing and collection issues in a timely manner, (v) the risk that patients do not pay the Company for their self-pay balances (including co-pays, deductibles and any portion of the claim not covered by insurance) and (vi) the risk of non-payment from uninsured patients. f) Allowance for Doubtful Accounts, Contractual and Other Discounts The Company derives the majority of its revenues from commercial payors at out-of-network rates. Management estimates the allowance for contractual and other discounts based on its historical collection experience. The services authorized and provided and related reimbursement are often subject to interpretation and negotiation that could result in payments that differ from the Company’s estimates. The Company’s allowance for doubtful accounts is based on historical experience, but management also takes into consideration the age of accounts, creditworthiness and current economic trends when evaluating the adequacy of the allowance for doubtful accounts. An account is written off only after the Company has pursued collection efforts or otherwise determines an account to be uncollectible. Uncollectible balances are written-off against the allowance. Recoveries of previously written-off balances are credited to income when the recoveries are made. g) Financial instruments The Company initially measures its financial assets and liabilities at fair value, except for certain non-arm’s length transactions. The Company subsequently measures all its financial assets and financial liabilities at amortized cost. Financial assets measured at amortized cost include cash and accounts receivable. Financial liabilities measured at amortized cost include bank indebtedness, accounts payable and accrued liabilities, harmonized sales tax payable, withholding taxes payable, convertible notes payable, loans payable and related party notes. Financial assets measured at cost are tested for impairment when there are indicators of impairment. The amount of the write-down is recognized in net income. The previously recognized impairment loss may be reversed to the extent of the improvement, directly or by adjusting the allowance account, provided it is no greater than the amount that would have been reported at the date of the reversal had the impairment not been recognized previously. The amount of the reversal is recognized in net income. The Company recognizes its transaction costs in net income in the period incurred. However, financial instruments that will not be subsequently measured at fair value are adjusted by the transaction costs that are directly attributable to their origination, issuance or assumption. FASB ASC 820 defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles, and expands disclosures about fair value measurements. ASC 820 establishes a three tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: ● Level 1. Observable inputs such as quoted prices in active markets; ● Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and ● Level 3. Unobservable inputs in which there is little or no market data, which requires the reporting entity to develop its own assumptions. The Company measures its convertible debt and derivative liabilities associated therewith at fair value. These liabilities are revalued periodically and the resultant gain or loss is realized through the Statement of Operations and Comprehensive Loss. h) Property and equipment Property and equipment is recorded at cost. Depreciation is calculated on the straight line basis over the estimated life of the asset: Building improvements are depreciated using the straight-line method over the term of the lease. i) Leases The Company accounts for leases in terms of AC 842 whereby leases are classified as either capital or operating leases. Leases that transfer substantially all of the benefits and inherent risks of ownership of property to the Company are accounted for as capital leases. At the time a capital lease is entered into, an asset is recorded together with its related long-term obligation to reflect the acquisition and financing. Equipment recorded under capital leases is amortized on the same basis as described above. Operating leases are recognized on the balance sheet as a lease liability with a corresponding right of use asset for all leases with a term that is more than twelve months. Payments under operating leases are expensed as incurred. j) Income taxes The Company accounts for income taxes under the provisions of ASC Topic 740, “Income Taxes”. ASC Topic 740 contains a two-step approach to recognizing and measuring uncertain tax positions taken or expected to be taken in a tax return. The first step is to determine if the weight of available evidence indicates that it is more likely than not that the tax position will be sustained in an audit, including resolution of any related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. The Company recognizes interest and penalties accrued on unrecognized tax benefits within general and administrative expense. To the extent that accrued interest and penalties do not ultimately become payable, amounts accrued will be reduced and reflected as a reduction in general and administrative expenses in the period that such determination is made. The tax returns for fiscal 2016, through 2019 are subject to audit or review by the US tax authorities, whereas fiscal 2010 through 2017 are subject to audit or review by the Canadian tax authority. k) Net income (loss) per Share Basic net income (loss) per share is computed on the basis of the weighted average number of common stock outstanding during the period. Diluted net income (loss) per share is computed on the basis of the weighted average number of common stock and common stock equivalents outstanding. Dilutive securities having an anti-dilutive effect on diluted net income (loss) per share are excluded from the calculation. Dilution is computed by applying the treasury stock method for options and warrants. Under this method, “in-the money” options and warrants are assumed to be exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase common stock at the average market price during the period. Dilution is computed by applying the if-converted method for convertible preferred stocks. Under this method, convertible preferred stock is assumed to be converted at the beginning of the period (or at the time of issuance, if later), and preferred dividends (if any) will be added back to determine income applicable to common stock. The shares issuable upon conversion will be added to weighted average number of common stock outstanding. Conversion will be assumed only if it reduces earnings per share (or increases loss per share). l) Stock based compensation Stock based compensation cost is measured at the grant date, based on the estimated fair value of the award and is recognized as expense over the employee’s requisite service period or vesting period on a straight-line basis. Share-based compensation expense recognized in the consolidated statements of operations for the year ended December 31, 2020 and 2019 is based on awards ultimately expected to vest and has been reduced for estimated forfeitures. This estimate will be revised in subsequent periods if actual forfeitures differ from those estimates. We have minimal awards with performance conditions and no awards dependent on market conditions. m) Derivatives The Company evaluates embedded conversion features within convertible debt under ASC 815 “Derivatives and Hedging” to determine whether the embedded conversion feature should be bifurcated from the host instrument and accounted for as a derivative at fair value with changes in fair value recorded in earnings. The Company uses a Black Scholes Option Pricing model to estimate the fair value of convertible debt conversion features at the end of each applicable reporting period. Changes in the fair value of these derivatives during each reporting period are included in the statements of operations. Inputs into the Black Scholes Option Pricing model require estimates, including such items as estimated volatility of the Company’s stock, risk free interest rate and the estimated life of the financial instruments being fair valued. If the conversion feature does not require derivative treatment under ASC 815, the instrument is evaluated under ASC 470-20 “Debt with Conversion and Other Options” for consideration of any beneficial conversion feature. n) Recent accounting pronouncements In August 2020, the FASB issued ASU No. 2020-06, debt with Conversion and Other Options (subtopic 470-20): and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40). Certain accounting models for convertible debt instruments with beneficial conversion features or cash conversion features are removed from the guidance and for equity instruments the contracts affected are free standing instruments and embedded features that are accounted for as derivatives, the settlement assessment was simplified by removing certain settlement requirements. This ASU is effective for fiscal years and interim periods beginning after December 15, 2021. The effects of this ASU on the Company’s consolidated financial statements is currently being assessed and is expected to have an impact on the treatment of certain convertible instruments, if any, and the derivative liabilities, if any, associated with these convertible instruments. The FASB issued several additional updates during the period, none of these standards are either applicable to the Company or require adoption at a future date and none are expected to have a material impact on the consolidated financial statements upon adoption. o) Financial instruments Risks The Company is exposed to various risks through its financial instruments. The following analysis provides a measure of the Company’s risk exposure and concentrations at the balance sheet date, December 31, 2020 and 2019. i. Credit risk Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation. Financial instruments that subject the Company to credit risk consist primarily of accounts receivable. Credit risk associated with accounts receivable is mitigated as only a percentage of the revenue billed to health insurance companies is recognized as income until such time as the actual funds are collected. The revenue is concentrated amongst several health insurance companies located in the US. In the opinion of management, credit risk with respect to accounts receivable is assessed as low. ii. Liquidity risk Liquidity risk is the risk the Company will not be able to meet its financial obligations as they fall due. The Company is exposed to liquidity risk through its working capital deficiency of $12,929,648, which includes derivative liabilities of $4,765,387, and an accumulated deficit of $42,459,781. The Company is dependent upon the raising of additional capital in order to implement its business plan. There is no assurance that the Company will be successful with future financing ventures, and the inability to secure such financing may have a material adverse effect on the Company’s financial condition. In the opinion of management, liquidity risk is assessed as high, material and remains unchanged from that of the prior year. iii. Market risk Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises of three types of risk: interest rate risk, currency risk, and other price risk. The Company is exposed to interest rate risk and currency risk. a. Interest rate risk Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is exposed to interest rate risk on its convertible debt, mortgage loans, short term loans, third party loans and government assistance loans as of December 31, 2020. In the opinion of management, interest rate risk is assessed as moderate. b. Currency risk Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Company is subject to currency risk as it has subsidiaries that operate in Canada and are subject to fluctuations in the Canadian dollar. A substantial portion of the Company’s financial assets and liabilities are denominated in Canadian dollars. Based on the net exposures at December 31, 2020, a 5% depreciation or appreciation of the Canadian dollar against the U.S. dollar would result in an approximate $10,606 increase or decrease in the Company’s after tax net income from operations. The Company has not entered into any hedging agreements to mitigate this risk. In the opinion of management, currency risk is assessed as low, material and remains unchanged from that of the prior year. c. Other price risk Other price risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices (other than those arising from interest rate risk or currency risk), whether those changes are caused by factors specific to the individual financial instrument or its issuer, or factors affecting all similar financial instruments traded in the market. In the opinion of management, the Company is not exposed to this risk and remains unchanged from the prior year. |
Going concern
Going concern | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going concern | 3. Going concern The Company’s consolidated financial statements have been prepared in accordance with US GAAP applicable to a going concern, which assumes that the Company will be able to meet its obligations and continue its operations in the normal course of business. As at December 31, 2020 the Company has a working capital deficiency of $12,929,648, including derivative liabilities of $4,765,387 and accumulated deficit of $42,459,781. Management believes that current available resources will not be sufficient to fund the Company’s planned expenditures over the next 12 months. Accordingly, the Company will be dependent upon the raising of additional capital through placement of common shares, and/or debt financing in order to implement its business plan, and generating sufficient revenue in excess of costs. If the Company raises additional capital through the issuance of equity securities or securities convertible into equity, stockholders will experience dilution, and such securities may have rights, preferences or privileges senior to those of the holders of common stock or convertible senior notes. If the Company raises additional funds by issuing debt, the Company may be subject to limitations on its operations, through debt covenants or other restrictions. If the Company obtains additional funds through arrangements with collaborators or strategic partners, the Company may be required to relinquish its rights to certain geographical areas, or techniques that it might otherwise seek to retain. There is no assurance that the Company will be successful with future financing ventures, and the inability to secure such financing may have a material adverse effect on the Company’s financial condition. These consolidated financial statements do not include any adjustments to the amounts and classifications of assets and liabilities that might be necessary should the Company be unable to continue operations. The ability of the Company to continue as a going concern is dependent on the Company generating cash from the sale of its common stock or obtaining debt financing and attaining future profitable operations. Management’s plans include selling its equity securities and obtaining debt financing to fund its capital requirements and ongoing operations; however, there can be no assurance the Company will be successful in these efforts. These factors create substantial doubt about the Company’s ability to continue as a going concern. These consolidated financial statements do not include any adjustments relating to the recoverability or classification of recorded assets and liabilities or other adjustments that may be necessary should the Company not be able to continue as a going concern. |
Other current assets
Other current assets | 12 Months Ended |
Dec. 31, 2020 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Other current assets | 4. Other current assets Other current assets includes the following: On February 25, 2019, the Company entered into a Letter of Intent whereby it would purchase a 33.33% interest in Local Link Wellness, LLC (“LLW”) for gross proceeds of $400,000. LLW proposes to provide a comprehensive addiction treatment program to large employee groups. The company has advanced LLW a total of $120,000 at December 31, 2020. These funds were advanced as short-term promissory notes that are immediately due and payable and are classified as other current assets on our consolidated balance sheet. The Company has no intention to close on the purchase of LLW and is currently negotiating with the vendors to provide advertising services in lieu of the return of the $120,000 invested by the Company. |
Other investments
Other investments | 12 Months Ended |
Dec. 31, 2020 | |
Investments, All Other Investments [Abstract] | |
Other investments | 5. Other investments On June 30, 2020, the Company entered into an agreement whereby the Company will acquire 51% of American Treatment Holdings, Inc. (“ATHI”) from The Q Global Trust (“Seller”) and Lawrence B Hawkins (“Hawkins”), which in turn owns 100% of Evernia Health Services LLC. (“Evernia”), which operates drug rehabilitation facilities. The consideration for the acquisition is a loan to be provided by the purchaser to Evernia in the amount of $500,000. As of December 31, 2020, the Company had advanced Avernia approximately $690,449 including accrued interest thereon. The Company originally had a 180 day option, from the advancement of the first tranche to Evernia, to purchase an additional 9% of ETHI for a purchase consideration of $50,000. The option has been extended and the Company had made a down payment of $10,000 towards exercising this option. On June 30, 2020, the Company entered into an agreement whereby the Company will acquire 51% of Behavioral Health Holdings, Inc. (“BHHI”) from The Q Global Trust (“Seller”) and Lawrence B Hawkins, which in turn owns 100% of Peace of Mind Counseling Services, Inc. (“PMCS”), which operates drug rehabilitation facilities. The consideration for the acquisition is still to be determined. The Company is currently considering its options to acquire a stake in BHHI and may renegotiate the deal terms. On July 12, 2020, the Company entered into a five year option agreement with Leonite Capital LLC (“Leonite”) and other investors (collectively the “Transferees”), the Company agreed to sell to Leonite a portion of the total outstanding shares of ATHI from the shares of ATHI held by the company. The Company provided Leonite an option to purchase 4,000,000 shares of ATHI from the Company for a purchase consideration of $0.0001 per share (a total consideration of $400), based on the advances that Leonite made to the Company totaling $396,000. Leonite shall share in all distributions by ATHI to the Company, on an as exercised basis, equal to the advances made by Leonite to the Company, thereafter the option will be reduced to 50% of the shares exercisable under the option. On September 14, 2020, the Company entered into a five year option agreement with Ed Blasiak (“Blasiak”) whereby the Company agreed to sell to Blasiak a portion of the total outstanding shares of ATHI. The Company provided Blasiak an option to purchase 571,428 shares of ATHI from the Company for a purchase consideration of $0.0001 per share (a total consideration of $57), based on the advances that Blasiak made to the Company totaling $50,000. Blasiak shall share in all distributions by ATHI to the Company, on an as exercised basis, equal to the advances made by Blasiak to the Company, thereafter the option will be reduced to 50% of the shares exercisable under the option. On October 29, 2020, the Company entered into a five year option agreement with First Fire whereby the Company agreed to sell to First Fire a portion of the total outstanding shares of ATHI. The Company provided First Fire an option to purchase 1,428,571 shares of ATHI from the Company for a purchase consideration of $0.0001 per share (a total consideration of $143), based on the advances that First Fire made to the Company totaling $120,000. First Fire shall share in all distributions by ATHI to the Company, on an as exercised basis, equal to the advances made by First Fire to the Company, thereafter the option will be reduced to 50% of the shares exercisable under the option. On October 29, 2020, the Company entered into a five year option agreement entered into with Bauman, so that the Company agreed to sell to Bauman a portion of the total outstanding shares of ATHI. The Company provided Bauman an option to purchase 1,428,571 shares of ATHI from the Company for a purchase consideration of $0.0001 per share (a total consideration of $143), based on the advances that Bauman made to the Company totaling $120,000. Bauman shall share in all distributions by ATHI to the Company, on an as exercised basis, equal to the advances made by Bauman to the Company, thereafter the option will be reduced to 50% of the shares exercisable under the option. |
Sale of property
Sale of property | 12 Months Ended |
Dec. 31, 2020 | |
Notes to Financial Statements | |
Sale of property | 6. Sale of property On April 2, 2019, the Company entered into a Commercial Contract with a third party whereby the real property at 801 Andrews Avenue, Delray Beach, Florida, consisting of land and condominiums thereon, was sold for $3,500,000. This transaction closed on April 26, 2019. The loss realized on the disposal was calculated as follows: Amount Proceeds received $ 4,975,174 Less: closing costs (182,344 ) Provision for additional expenses (36,470 ) Net proceeds received 4,756,360 Assets sold: Land 2,753,928 Buildings thereon, net of depreciation 2,949,452 Furniture and fixtures, net of depreciation 72,792 5,776,172 Loss on disposal of property $ 1,019,812 On October 10, 2019, in terms of a deed of transfer the Company disposed of the remaining property located at 810 Andrews Avenue, Delray Beach, Florida to a convertible note holder in partial settlement of the convertible note outstanding for net proceeds of $1,475,174. During the year ended December 31, 2020, the Company released a provision raised for additional expenses on the disposal of the 810 Andrews Avenue properties mentioned above. |
Deposit on real estate
Deposit on real estate | 12 Months Ended |
Dec. 31, 2020 | |
Notes to Financial Statements | |
Deposit on real estate | 7. Deposit on real estate On November 2, 2017, the Company entered into an Agreement to purchase from AREP 5400 East Avenue LLC certain buildings in West Palm Beach, Florida, totaling approximately 80,000 square feet, on which the present tenant operates a substance abuse treatment center. The purchase price of the Property was $20,530,000. The Company made a series of nonrefundable down payments totaling $2,940,546 and $1,825,000 as of December 31, 2018 and 2017. On May 23, 2018, the Company converted the agreement to a lease agreement with a purchase option of $17,250,000, increasing August 31, 2018 by $750,000 per month until the purchase option is exercised. The premises is located at 5400, 5402 and 5410 East Avenue, West Palm Beach, Florida (the “Property”). The lease was for an initial 10 years and provided for two additional 10 year extensions. The Company previously was under agreement to purchase the property from the landlord. The property is presently used as a rehabilitation treatment center. The current tenant at the property, Alternatives in Treatment, LLC, a Florida limited liability company, consented to the Lease and concurrent with the execution of the Lease entered into a Sublease Agreement with the Company. On December 20, 2019 the Company entered into an agreement to terminate the lease agreement on January 30, 2020. As of December 31, 2019, the deposits paid of $2,924,955 were offset against the unpaid rental as of December 31, 2019 of $1,509,877. A contingency reserve of $250,000 was allowed for any future claims the landlord may have against the Company, resulting in a forfeiture of the deposit balance of $1,665,078. |
Due on sale of business
Due on sale of business | 12 Months Ended |
Dec. 31, 2020 | |
Notes to Financial Statements | |
Due on sale of business | 8. Due on sale of business On February 14, 2017, the Company sold its Canadian Rehab Clinic for gross proceeds of CDN$10,000,000, of which CDN$1,500,000 had been retained in an escrow account for a period of up to two years in order to guarantee the warranties provided by the Company in terms of the APA. As of December 31, 2020, CDN$1,055,042 of the escrow had been refunded to the Company and CDN$461,318 had been used to affect building improvements to the premises owned by CCH, for a total reduction of CDN$1,516,360. The remaining escrow balance was CDN$6,485 (approximately US$ 5,094). |
Property and equipment
Property and equipment | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property and equipment | 9. Property and equipment Property and equipment consists of the following: December 31, December 31, 2019 Cost Accumulated depreciation Net book value Net book value Land $ 168,866 $ — $ 168,866 $ 165,537 Property 3,194,427 (481,073 ) 2,713,354 2,785,131 $ 3,363,293 $ (481,073 ) $ 2,882,220 $ 2,950,668 Depreciation expense for the year ended December 31, 2020 and 2019 was $121,276 and $217,018, respectively. On December 20, 2019, in terms of an agreement with the landlord the lease for the West Palm Beach facility was terminated and the Company impaired the leasehold improvements relating to the leased property, the impairment charge was $242,514. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Leases | 10. Leases The Company's leases consisted of operating leases that relate to a real estate rental agreement entered into in May 2018. On January 30, 2020, the Company verbally terminated the lease with the current landlord who had leased the premises to a third party and subsequently sold the property. The operating lease liability and right-of-use asset had been eliminated as of December 31, 2019. Total operating lease cost Individual components of the total lease cost incurred by the Company is as follows: Year ended December 31, 2020 Year ended December 31, Operating lease expense $ 5,512 $ 1,360,117 |
Taxes Payable
Taxes Payable | 12 Months Ended |
Dec. 31, 2020 | |
Notes to Financial Statements | |
Taxes Payable | 11. Taxes Payable The taxes payable consist of: â—Ź A payroll tax liability of $143,410 (CDN$182,589) in Greenestone Muskoka which has not been settled as yet. â—Ź A GST/HST tax payable of $73,503 (CDN$93,585). â—Ź The Company has assets and operates businesses in Canada and is required to disclose these operations to the US taxation authorities, the requisite disclosure has not been made. Management has reserved the maximum penalty due to the IRS in terms of non-disclosure. This noncompliance with US disclosure requirements is currently being addressed. An amount of $250,000 has been accrued for any potential exposure the Company may have. December 31, December 31, Payroll taxes $ 143,410 $ 140,583 HST/GST payable 73,503 26,524 US penalties due 250,000 250,000 Income tax payable 383,364 375,808 $ 850,277 $ 792,915 |
Short-term Convertible Notes
Short-term Convertible Notes | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Short-term Convertible Notes | 12. Short-term Convertible Notes The short-term convertible notes consist of the following: Interest rate Maturity Date Principal Interest Debt Discount December 31, 2020 December 31, 2019 Leonite Capital, LLC 8.5 % On demand $ 70,000 $ 583 $ - $ 70,583 $ 1,213,148 6.5 % June 12, 2021 396,000 9,060 (258,002 ) 147,058 — Power Up Lending Group Ltd — — — — — — 33,707 — — — — — — 51,827 First Fire Global Opportunities Fund — — — — — — 247,361 6.5 % October 29,2021 137,500 1,564 (113,767 ) 25,297 — Auctus Fund, LLC 10.0 % May 7, 2020 150,000 — — 150,000 129,016 10.0 % August 13, 2021 95,000 3,764 (58,562 ) 40,202 — Labrys Fund, LP — — — — — — 286,057 12.0 % November 30, 2021 275,000 2,803 (251,644 ) 26,159 — Ed Blasiak 6.5 % September 14, 2021 55,000 1,073 (38,726 ) 17,347 — Joshua Bauman 6.5 % September 14, 2021 137,500 2,562 (96,815 ) 43,247 — Geneva Roth Remark Holdings, Inc. 9.0 % August 29, 2021 88,000 1,001 (69,763 ) 19,238 — 9.0 % October 15, 2021 53,000 477 (46,724 ) 6,753 — Series N convertible notes 6.0 % On Demand 3,229,000 425,333 — 3,654,333 3,079,997 $ 4,200,217 $ 5,041,113 Leonite Capital, LLC On December 1, 2017, the Company closed on a private offering to raise US $1,500,000 in capital. The Company issued one senior secured convertible promissory note with a principal amount of $1,650,000 to Leonite Capital, LLC (“Leonite”). The note is convertible into shares of common stock at a conversion price of $0.06 per share, subject to anti-dilution and price protection. The Note bears interest at the rate of 8.5% per annum. The Note’s amended maturity date was December 1, 2018. During the term of the Note the Company and the Subsidiaries was obligated to make monthly payment of accrued and unpaid interest. The Note contains Company and Subsidiary representations and warranties, covenants, events of default, and registration rights. The Company paid a commitment fee of $132,000 settled through the issue of 1,650,000 shares of common stock and paid $20,000 towards the lenders legal fees. In conjunction with this note, the Company issued a five year warrant to purchase 27,500,000 shares of common stock at an exercise price or $0.10 per share, subject to anti-dilution and price protection. The Note provided that the parties use reasonable best efforts to close on the remaining $1,200,000 of availability under the Note by January 1, 2018. As a condition to the closing of the Balance Tranche, the parties must finalize and enter into additional agreements related to the Private Offering, including, but not limited to, (i) a Securities Purchase Agreement; (ii) a Warrant Agreement under which the Investor will have the right to purchase up to 27,500,000 shares of the Company’ common stock for $0.10 per share, subject to adjustment, for a period of five years; (iii) a Securities Pledge Agreement under which the Company and the Subsidiaries will grant the lender a blanket lien on their assets, and the Company will pledge its equity ownership in the Subsidiaries. Upon the closing of the Balance Tranche the maturity date of the Note was to become December 1, 2018. On December 29, 2017, effective as of December 1, 2017, the Company and the Subsidiaries entered into an Amended and Restated Senior Secured Convertible Promissory Note, which note amended and restated the Note to (a) extend the maturity date to December 1, 2018; (b) remove CCH, as an obligor; (c) increase the interest rate by 2.00% per annum, to 8.5% per annum; and (d) issue an additional 250,000 shares of the Company’s common stock to the Investor. In connection with the execution of the amendment, the parties entered into (i) a Securities Purchase Agreement; (ii) a Warrant Agreement under which the Investor will have the right to purchase up to 27,500,000 shares of the Company’ common stock for $0.10 per share, subject to adjustment, for a period of five years; (iii) a Security and Pledge Agreement and a General Security Agreement under which the Company and the Subsidiaries will grant the Investor a blanket lien on their assets, and the Company will pledge its equity ownership in the Subsidiaries; effective January 2, 2018. At the execution of the Note, the Investor funded an initial tranche of $300,000. Thereafter the Investor funded a second tranche of $156,136. Upon the execution of the A&R Note the Investor funded a third tranche of $100,000. Upon the execution of the First Amendment the Investor funded a final tranche of $850,000, with the remaining $93,764 of availability under the A&R Note, as amended, serving as a holdback pursuant to the terms of the First Amendment. On March 29, 2018, the Company, entered into a Securities Purchase Agreement pursuant to which the Company issued a Convertible Promissory Note in the aggregate principal amount of $165,000, including an Original Issue Discount of $15,000, for net proceeds of $150,000. The note had a maturity date of December 1, 2018 and bears interest at a rate of 8.5% per annum. The outstanding principal amount of the note is convertible at any time and from time to time at the election of the purchaser following the issue date into shares of the Company’s common stock at a conversion price equal to $0.06 per share subject to anti-dilution and price protection. The Company paid a commitment fee of $11,550 settled through the issue of 165,000 shares of common stock. In conjunction with this note the Company issued a five year warrant to purchase 5,500,000 shares of common stock at an exercise price of $0.10 per share, subject to anti-dilution and price protection. On April 17, 2018, the Company, entered into a Securities Purchase Agreement pursuant to which the Company issued a Convertible Promissory Note in the aggregate principal amount of $605,000, including an Original Issue Discount of $55,000, for net proceeds of $550,000. The note had a maturity date of December 1, 2018 and bears interest at 8.5% per annum. The outstanding principal amount of the note is convertible at any time and from time to time at the election of the purchaser following the issue date into shares of the Company’s common stock at a conversion price equal to $0.06 per share subject to price protection and anti-dilution protection. The Company paid a commitment fee of $42,350 settled through the issue of 10,083,333 shares of common stock. In conjunction with this note the Company issued a five year warrant to purchase 10,083,333 shares of common stock at an exercise price of $0.10 per share, subject to anti-dilution and price protection. On January 17, 2019, the Company, entered into a Securities Purchase Agreement pursuant to which the Company issued a Convertible Promissory Note in the aggregate principal amount of $71,111, including an Original Issue Discount of $7,111, for net proceeds of $64,000. The note had a maturity date of July 25, 2019 and bears interest at 11.0% per annum. The outstanding principal amount of the note was convertible at any time and from time to time at the election of the purchaser following the issue date into shares of the Company’s common stock at a conversion price equal to $0.06 per share subject to price protection and anti-dilution protection. The Company paid a commitment fee of $4,978 settled through the issue of 71,111 shares of common stock. In conjunction with this note the Company issued a five year warrant to purchase 1,185,183 shares of common stock at an exercise price of $0.10 per share, subject to anti-dilution and price protection. Effective March 19, 2019, the Company entered into a note extension agreement with Leonite, whereby the convertible notes outstanding to Leonite, amounting to $2,420,000, for consideration of $75,000 added to the principal outstanding on the note on January 1, 2019, a further $75,000 added to the principal outstanding on the note on February 1, 2019 and a further $100,000 added to the principal of the note on March 15, 2019, the maturity date of all of the convertible notes above were extended to December 31, 2019 and has subsequently been partially settled by the transfer of the property located at 810 Andrews Avenue, Delray Beach, Florida, valued at $1,500,000. On August 26, 2019, the Company, entered into a Securities Purchase Agreement pursuant to which the Company issued a Convertible Promissory Note in the aggregate principal amount of $60,000, including an Original Issue Discount of $10,000, for net proceeds of $47,000. The note had a maturity date of September 10, 2019 and bears interest at 1.0% per annum. The outstanding principal amount of the note is convertible at any time and from time to time at the election of the purchaser following the issue date into shares of the Company’s common stock at a conversion price equal to $0.06 per share subject to price protection and anti-dilution protection. In conjunction with this note the Company issued a five year warrant to purchase 1,000,000 shares of common stock at an exercise price of $0.10 per share, subject to anti-dilution and price protection. On October 10, 2019, the Company transferred a warranty deed to the real property located at 810 Andrews Avenue, Delray Beach, Florida to Leonite Capital LLC, in settlement of indebtedness of $1,398,514 and additional expenses related to the disposal of the property of $36,470. These expenses of $36,470 were provided for resulting in net proceeds recognized on the transfer of the property of $1,362,044. On July 12, 2020, the company entered into a debt extinguishment agreement with Leonite whereby the following occurred: 1. The total amount outstanding under the note, including principal and interest was reduced to $150,000 2. $700,000 of the note was converted into Series A Redeemable Preferred shares in the Company’s subsidiary, Cranberry Cove Holdings, accruing dividends at 10% per annum. 3. $400,000 of the note was converted into series B Preferred stock in the Company for a 12 month period, mandatorily redeemable by the Company accruing dividends at 6% per annum payable in cash or stock, subject to certain conditions. 4. The remaining balance of $150,000 will accrue interest at 8.5% per annum and is convertible into common stock and repayable in 6 monthly installments of $25,000 commencing after December 12, 2020. 5. The existing warrants were cancelled and a new five year warrant, with a cashless exercise options, exercisable for a minimum of 326,286,847 shares of common stock and a maximum of 20% of the outstanding equity of the Company at an initial exercise price of $0.10 per share subject to adjustment based on new stock issuances or the lowest volume weighted exercise price of the stock for 30 days immediately preceding the exercise was issued to Leonite. On July 12, 2020, the Company entered into a Senior Secured Convertible Note agreement with Leonite for $440,000 with an original issue discount of $40,000 for gross proceeds of $400,000, the initial tranche advanced will be for cash of $200,000 plus the OID of $20,000, the remaining advances will be at the discretion of the Leonite. The loan bears interest at 6.5% per annum and matures on June 12, 2021. The Company is required to make monthly payments of the accrued interest on the advances made. The note is convertible into common shares at the option of the holder at $0.10 per share, or 80% multiplied by the price per share paid in subsequent financings or after a six month period from the effective date at 60% of the lowest trading price during the preceding 21 consecutive trading days. The note has both conversion price protection and anti-dilution protection provisions. As of December 31, 2020, net proceeds of $360,000 was advanced to the Company. On July 12, 2020, the Company entered into a five year option agreement with Leonite, the Company agreed to sell to Leonite a portion of the total outstanding shares of ATHI from the shares of ATHI held by the company. The Company provided Leonite an option to purchase 400,000 shares of ATHI from the Company for a purchase consideration of $0.0001 per share (a total consideration of $400), based on the advances that Leonite made to the Company totaling $396,000. Leonite shall share in all distributions by ATHI to the Company, on an as exercised basis, equal to the advances made by Leonite to the Company, thereafter the option will be reduced to 50% of the shares exercisable under the option. On December 28, 2020, The Company converted $80,000 plus accrued interest of $5,949 of the Leonite loan amended on July 12, 2020, into 96,331,811 shares of common stock at a conversion price of $0.0009, thereby realizing a loss on conversion of $240,616. Power Up Lending Group LTD On January 9, 2019, the Company, entered into a Securities Purchase Agreement with Power Up, pursuant to which the Company issued a Convertible Promissory Note in the aggregate principal amount of $53,000 for net proceeds of $50,000 after expenses. The Note had a maturity date of October 30, 2019 and bears interest at the rate of nine percent per annum from the date on which the Note was issued until the same becomes due and payable, whether at maturity or upon acceleration or by prepayment or otherwise. The Company has the right to prepay the Note in terms of agreement. The outstanding principal amount of the Note was convertible at any time and from time to time at the election of Power Up during the period beginning on the date that is 180 days following the issue date into shares of the Company’s common stock at a conversion price equal to 61% of the lowest closing bid price of the Company’s common stock for the ten trading days prior to conversion. On July 8, 2019, the Company repaid the convertible note of $53,000 together with interest thereon and early settlement penalty for gross proceeds of $72,000. The outstanding principal amount of the Note is convertible at any time and from time to time at the election of the Purchaser during the period beginning on the date that is 180 days following the issue date into shares of the Company’s common stock at a conversion price equal to 61% of the lowest closing bid price of the Company’s common stock for the ten trading days prior to conversion. On January 28, 2019, the Company repaid the Power Up convertible note entered into on July 31, 2018 of $153,000 together with interest and early settlement penalty thereon for a payout of $207,679. On July 8, 2019, the Company entered into a Securities Purchase Agreement with Power Up, pursuant to which the Company issued a Convertible Promissory Note in the aggregate principal amount of $53,000. The Note had a maturity date of April 30, 2020 and bore interest at the rate of nine percent per annum from the date on which the Note was issued until the same becomes due and payable, whether at maturity or upon acceleration or by prepayment or otherwise. The Company has the right to prepay the Note in terms of agreement. The outstanding principal amount of the Note is convertible at any time and from time to time at the election of Power Up during the period beginning on the date that is 180 days following the issue date into shares of the Company’s common stock at a conversion price equal to 61% of the lowest closing bid price of the Company’s common stock for the ten trading days prior to conversion. Between January 10, 2020 and January 24, 2020, in terms of conversion notices received, Power Up converted the aggregate principal amount of $53,000 and interest thereon of $1,085 into 75,618,509 shares of common stock at an average conversion price of $0.000715 per share. On July 15 2019, the Company, entered into a Securities Purchase Agreement with Power Up, pursuant to which the Company issued a Convertible Promissory Note in the aggregate principal amount of $83,000. The Note has a maturity date of April 30, 2020 and bears interest at the rate of nine percent per annum from the date on which the Note was issued until the same becomes due and payable, whether at maturity or upon acceleration or by prepayment or otherwise. The Company has the right to prepay the Note in terms of agreement. The outstanding principal amount of the Note is convertible at any time and from time to time at the election of Power Up during the period beginning on the date that is 180 days following the issue date into shares of the Company’s common stock at a conversion price equal to 61% of the lowest closing bid price of the Company’s common stock for the ten trading days prior to conversion. Between January 24, 2020 and February 27, 2020, in terms of conversion notices received, Power Up converted the aggregate principal amount of $41,400 into 453,800,493 shares of common stock at an average conversion price of 0.0000912 per share. On June 1, 2020, The Company repaid the Power Up Lending Group $41,600 in full settlement of the convertible note entered into on July 15, 2019. First Fire Global Opportunities Fund On March 5, 2019, the Company entered into a Securities Purchase Agreement pursuant to which the Company issued a Convertible Promissory Note in the aggregate principal amount of $200,000, for net proceeds of $192,000 after the payment of legal fees and origination fees amounting to $8,000. The note has a maturity date of December 9, 2019. The outstanding principal amount of the note is convertible at any time and from time to time at the election of the purchaser. 180 days after the issued date into shares of the Company’s common stock at the lower of $0.08 per share or 65% of the lowest trade price during the ten consecutive trading days immediately prior to conversion. The note has certain buyback terms if the Company consummates a registered or unregistered primary offering of securities for capital raising purposes, or an option to convert at a 20% discount to the offering price to investors. Between September 11, 2019 and December 30, 2019, in terms of a conversion notices received, the Company issued 11,887,445 shares of Common stock in settlement of $36,592 of principal outstanding. Between January 6, 2020 and February 26, 2020, in terms of conversion notices received, First Fire converted an aggregate principal amount of $83,902 into 308,100,000 shares of common stock at an average conversion price of $0.000272 per share. On June 3, 2020, the Company entered into an agreement with First Fire whereby the remaining balance of the convertible note of $73,006 would be settled by two payments of $25,000 each. Between July 2, 2020 and August 17, 2020, the Company repaid the remaining principal outstanding of $50,000 plus additional interest charges of $1,500. Auctus Fund, LLC On August 7 2019, the Company, entered into a Securities Purchase Agreement with Auctus Fund, LLC, pursuant to which the Company issued a Convertible Promissory Note in the aggregate principal amount of $225,000. The Note had a maturity date of May 7, 2020 and bore interest at the rate of ten percent per annum from the date on which the Note was issued until the same became due and payable, whether at maturity or upon acceleration or by prepayment or otherwise. The Company had the right to prepay the Note in terms of agreement. The outstanding principal amount of the Note is convertible at any time and from time to time at the election of Auctus Fund, LLC during the period beginning on the date that is 180 days following the issue date into shares of the Company’s common stock at a conversion price equal to 60% of the lowest closing bid price of the Company’s common stock for the thirty trading days prior to conversion. On June 15, 2020, The Company entered into an amended agreement with Auctus whereby Auctus agreed to discharge the principal amount of the note by nine equal monthly installments of $25,000 commencing in October 2020. On August 13, 2020, the Company entered into a Securities Purchase Agreement with Auctus Fund LLC, pursuant to which the Company issued a convertible promissory note in the aggregate principal amount of $100,000 for net proceeds of $85,000 after certain fees and expenses of $15,000. The note has a maturity date of August 13, 2021 and bears interest at 10% per annum. The interest due on the note for the full twelve month period is due immediately upon issuance of the note, regardless of acceleration or prepayment. The principal amount of the note is payable in six monthly instalments of $16,666.66 commencing 180 days after the issuance date, the balance outstanding under the note due at maturity date. In the event a default occurs under the Note, the Note is convertible into shares of common stock at a conversion price equal to the lowest trading price over the prior 5 days prior to the date of the note or the five day volume weighted market price prior to the date of conversion. The Company is required to adhere to certain covenants including covenants concerning distributions of capital stock; restrictions on stock repurchases, additional borrowings sales of assets and loans and advances made by the Company. In conjunction with the issuance of the promissory note, the Company issued a five year warrant exercisable for 66,666,666 shares of common stock at an exercisable price of $0.0015 per share subject to anti-dilution and price protection adjustments. The Company also issued a second five year warrant exercisable for 66,666,666 shares of common stock at an exercisable price of $0.0015 per share subject to anti-dilution and price protection adjustments, which warrants will only be exercisable upon an event of default on the convertible note. Labrys Fund, LP On July 8, 2019, the Company, entered into a Securities Purchase Agreement with Labrys Fund, LP (“Labrys”), pursuant to which the Company issued a Convertible Promissory Note in the aggregate principal amount of $282,000 for net proceeds of $253,800 after an original issue discount of $28,200. The Note had a maturity date of January 8, 2020 and bore interest at the rate of twelve percent per annum from the date on which the Note was issued until the same became due and payable, whether at maturity or upon acceleration or by prepayment or otherwise. The Company had the right to prepay the Note in terms of agreement. The outstanding principal amount of the Note was convertible at any time and from time to time at the election of Labrys during the period beginning on the date that is 180 days following the issue date into shares of the Company's common stock at a conversion price equal to 60% of the lowest closing bid price of the Company's common stock for the thirty trading days prior to conversion. In connection with the issuance of the convertible promissory note to Labrys, the Company issued 2,700,000 returnable shares. These shares were returnable if the note was paid prior to maturity date on January 8, 2020. The company had not repaid the note on the maturity date, January 8, 2020, therefore the 2,700,000 shares were expensed as an additional fee amounting to $165,780, the value of the shares on the date of grant. Between January 15, 2020 and February 25, 2020, in terms of conversion notices received, Labrys converted the aggregate principal sum of $8,936 and interest of $19,867 into 479,160,076 shares of common stock at an average conversion price of 0.00006 per share. On May 15, 2020 the Company entered into an amended agreement with Labrys Fund LP whereby default interest and penalties were waived, no further conversions will be effectuated and the Company committed to make eight equal payments of $25,000 commencing on October 15, 2020, in full settlement of the balance outstanding. No event of default will occur as long as the Company makes all scheduled payments. Between October 21, 2020 and November 30, 2020, the Company repaid principal of $37,500. The Company was unable to adhere to the amended repayment schedule and default penalty and penalty interest was reinstated. On November 30, 2020, Labrys converted principal of $235,564 and interest thereon of $20,416 into 91,421,457 shares of common stock, realizing a gain on conversion of $4,571, thereby extinguishing the note. On November 30, 2020, the Company, entered into a Securities Purchase Agreement with Labrys, pursuant to which the Company issued a Convertible Promissory Note in the aggregate principal amount of $275,000 for net proceeds of $239,050 after an original issue discount of $27,500 and certain legal expenses. The Note has a maturity date of November 30, 2021 and bears interest at the rate of twelve percent per annum from the date on which the Note was issued until the same became due and payable, whether at maturity or upon acceleration or by prepayment or otherwise. The Company has the right to prepay the Note in terms of agreement. The outstanding principal amount of the Note was convertible at any time and from time to time at the election of Labrys during the period beginning on the date that is 180 days following the issue date into shares of the Company's common stock at a conversion price equal to 60% of the lowest closing bid price of the Company's common stock for the thirty trading days prior to conversion. In connection with the issuance of the convertible promissory note to Labrys, the Company granted Labrys a five-year warrant to purchase 100,000,000 shares of common stock at an exercise price of $0.00205 per share. The value of the warrant was accounted for as a debt discount. Ed Blasiak On September 14, 2020, the Company entered into a Securities Purchase Agreement with Ed Blasiak (“Blasiak”), pursuant to which the Company issued a senior secured convertible promissory note in the aggregate principal amount of $55,000, including an original issue discount of $5,000. The note bears interest at 6.5% per annum and matures on September 14, 2021. The note is senior to any future borrowings and commencing on October 1, 2020 the Company will make monthly payments of the accrued interest under the note. The note may be prepaid at certain prepayment penalties and is convertible into shares of common stock at a conversion price at the option of the holder at $0.001 per share, adjusted for anti-dilution provisions; or 80% of the price per share of subsequent equity financings or; after six months 60% of the lowest trading price during the preceding six month period. On September 14, 2020, the Company entered into a five year option agreement with Ed Blasiak (“Blasiak”) whereby the Company agreed to sell to Blasiak a portion of the total outstanding shares of ATHI. The Company provided Blasiak an option to purchase 571,428 shares of ATHI from the Company for a purchase consideration of $0.0001 per share (a total consideration of $57), based on the advances that Blasiak made to the Company totaling $50,000. Blasiak shall share in all distributions by ATHI to the Company, on an as exercised basis, equal to the advances made by Blasiak to the Company, thereafter the option will be reduced to 50% of the shares exercisable under the option. Joshua Bauman On September 14, 2020, the Company entered into a Securities Purchase Agreement with Joshua Bauman (“Bauman”), pursuant to which the Company issued a senior secured convertible promissory note in the aggregate principal amount of $110,000, including an original issue discount of $10,000. The note bears interest at 6.5% per annum and matures on September 14, 2021. The note is senior to any future borrowings and commencing on October 1, 2020 the Company will make monthly payments of the accrued interest under the note. The note may be prepaid at certain prepayment penalties and is convertible into shares of common stock at a conversion price at the option of the holder at $0.001 per share, adjusted for anti-dilution provisions; or 80% of the price per share of subsequent equity financings or; after six months 60% of the lowest trading price during the preceding six month period. On September 14, 2020, the Company entered into a five year option agreement with Bauman, whereby the Company agreed to sell a portion of the total outstanding shares of ATHI. The Company provided Bauman an option to purchase 1,142,856 shares of ATHI from the Company for a purchase consideration of $0.0001 per share (a total consideration of $114), based on the advances that Bauman made to the Company totaling $110,000. Bauman shall share in all distributions by ATHI to the Company, on an as exercised basis, equal to the advances made by Bauman to the Company, thereafter the option will be reduced to 50% of the shares exercisable under the option. On October 29, 2020, the Company amended the five year option agreement entered into with Bauman, so that the Company agreed to sell to Bauman a portion of the total outstanding shares of ATHI. The Company provided Bauman an option to purchase 1,428,571 shares of ATHI from the Company for a purchase consideration of $0.0001 per share (a total consideration of $143), based on the advances that Bauman made to the Company totaling $120,000. Bauman shall share in all distributions by ATHI to the Company, on an as exercised basis, equal to the advances made by Bauman to the Company, thereafter the option will be reduced to 50% of the shares exercisable under the option. Geneva Roth Remark Holdings, Inc On October 29, 2020, the Company entered into a Securities Purchase Agreement pursuant to which the Company issued a Convertible Promissory Note in the aggregate principal amount of $88,000, for net proceeds of $85,000 after the payment of legal fees and origination fees amounting to $3,000. The note has a maturity date of August 29, 2021 and bears interest at the rate of 9.0% per annum. The outstanding principal amount of the note is convertible at any time and from time to time at the election of the purchaser. 180 days after the issued date into shares of the Company’s common stock at 61% of the lowest trade price during the ten consecutive trading days immediately prior to conversion. The principal plus the accrued interest of the Note may be prepaid by the Company prior to the expiry of 180 days from issuance date at a prepayment penalty ranging from 112% to 130%. On November 24, 2020, the Company entered into a Securities Purchase Agreement pursuant to which the Company issued a Convertible Promissory Note in the aggregate principal amount of $53,000, for net proceeds of $50,000 after the payment of legal fees and origination fees amounting to $3,000. The note has a maturity date of October 15, 2021 and bears interest at the rate of 9.0% per annum. The outstanding principal amount of the note is convertible at any time and from time to time at the election of the purchaser. 180 days after the issued date into shares of the Company’s common stock at 61% of the lowest trade price during the ten consecutive trading days immediately prior to conversion. The principal plus the accrued interest of the Note may be prepaid by the Company prior to the expiry of 180 days from issuance date at a prepayment penalty ranging from 112% to 130%. Series N convertible notes Between January 28, 2019 and September 17, 2019, the Company closed several tranches of Series N Convertible notes in which it raised $1,643,894 in principal from accredited investors through the issuance to the investors of the Company’s Series N convertible notes, in the total original principal amount of $1,643,894, which Notes are convertible into the Company’s common stock at a conversion price of $0.08 per share together with three year warrants to purchase up to a total of 20,925,000 shares of the Company’s common stock at an exercise price of $0.12 per share. Both the conversion price under the Notes and the exercise price under the warrants are subject to standard adjustment mechanisms. The notes mature one year from the date of issuance. On May 15, 2019, one investor converted the aggregate principal amount of $950,000 of Series N convertible notes into 11,875,000 shares of common stock at a conversion price of $0.08 per share. |
Mortgage loans
Mortgage loans | 12 Months Ended |
Dec. 31, 2020 | |
Payables and Accruals [Abstract] | |
Mortgage loans | 13. Mortgage loans Mortgage loans is disclosed as follows: Interest rate Maturity date Principal Outstanding Accrued interest December 31, 2020 December 31, 2019 Cranberry Cove Holdings, Ltd. Pace Mortgage 4.2 % July 19, 2022 $ 3,958,315 $ 5,466 $ 3,963,781 $ 3,995,235 $ 3,958,315 $ 5,466 $ 3,963,781 $ 3,995,235 Disclosed as follows: Short-term portion $ 115,704 $ 114,290 Long-term portion 3,848,077 3,880,945 $ 3,963,781 $ 3,995,235 The aggregate amount outstanding is payable as follows: Amount 2021 115,704 2022 3,848,077 Total $ 3,963,781 Cranberry Cove Holdings, Ltd. On July 19, 2017, CCH, a wholly owned subsidiary, closed on a loan agreement in the principal amount of CDN$5,500,000. The loan is secured by a first mortgage on the premises owned by CCH located at 3571 Muskoka Road 169, Bala, Ontario. The loan bears interest at the fixed rate of 4.2% with a 5-year primary term and a 25-year amortization. The Company has guaranteed the loan and the Company’s chief executive officer and controlling shareholder also has personally guaranteed the Loan. CCH and the Company have granted the Lender a general security interest in its assets to secure repayment of the Loan. The loan is amortized with monthly installments of CDN $29,531. |
Short term loans
Short term loans | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Short term loans | 14. Short term loans On April 12, 2019, Eileen Greene, a related party assigned CDN1,000,000 of the amount owed by the Company to her, to a third party. The loan bears interest at 12% per annum which the Company agreed to pay. |
Government assistance loans
Government assistance loans | 12 Months Ended |
Dec. 31, 2020 | |
Notes to Financial Statements | |
Government assistance loans | 15. Government assistance loans On May 10, 2020, the Company was granted a government assistance loan in the aggregate principal amount of $156,782. The loan is forgivable if the Company demonstrates that the proceeds were used for expenses such as employee costs during the pandemic. Should the loan not be forgiven, interest is payable on the loan at the rate of 1% per annum and the principal is repayable and interest is payable over an 18 month period. No payments have been made to date and the Company expects the loan to be forgiven, therefore no interest has been accrued. On December 1, 2020, CCH was granted a Covid-19 related government assistance loan in the aggregate principal amount of CDN$ 40,000 (Approximately $31,000). the grant is interest free and CDN$ 10,000 is forgivable if the loan is repaid in full by December 31, 2022. |
Derivative liability
Derivative liability | 12 Months Ended |
Dec. 31, 2020 | |
Notes to Financial Statements | |
Derivative liability | 16. Derivative liability The short-term convertible notes, together with certain warrants issued to convertible note holders disclosed in note 12 above and note 18 below, have variable priced conversion rights with no fixed floor price and will reprice dependent on the share price performance over varying periods of time. This gives rise to a derivative financial liability, which was initially valued at inception of the convertible notes at $1,959,959 using a Black-Scholes valuation model. The derivative liability is marked-to-market on a quarterly basis. As of December 31, 2020, the derivative liability was valued at $4,765,387. The following assumptions were used in the Black-Scholes valuation model: Year ended Calculated stock price $0.0001 to $0.0034 Risk free interest rate 0.05% to 0.36% Expected life of convertible notes and warrants 3 to 60 months expected volatility of underlying stock 193.9% to 779.0% Expected dividend rate 0 % The movement in derivative liability is as follows: December 31, December 31, Opening balance $ 8,694,272 $ 4,618,080 Derivative liability mark-to-market on convertible debt extinguishment 126,444,276 — Derivative liability on revised convertible notes and warrants arising from convertible debt extinguishment 6,349,265 — Derivative liability cancelled on debt extinguishment (144,893,444 ) — Derivative liability on issued convertible notes and variable priced warrants 1,129,050 1,477,163 Fair value adjustments to derivative liability 7,041,968 2,599,029 Closing balance $ 4,765,387 $ 8,694,272 |
Related party transactions
Related party transactions | 12 Months Ended |
Dec. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related party transactions | 17. Related party transactions Shawn E. Leon As of December 31, 2020 and 2019 the Company had a payable to Shawn Leon of $322,744 and $293,072, respectively. Mr. Leon is a director and CEO of the Company. The balances payable are non-interest bearing and has no fixed repayment terms. Due to the current financial position of the Group, Mr. Leon forfeited the management fees due to him for the years ended December 31, 2020 and 2019. Leon Developments, Ltd. As of December 31, 2020 and 2019, the Company owed Leon Developments, Ltd. $930,307 and $904,121, respectively, for funds advanced to the Company. Eileen Greene As of December 31, 2020 and 2019, the Company owed Eileen Greene, the spouse of our CEO, Shawn Leon, $1,558,798 and $1,595,887, respectively. During the year ended December 31, 2020, Ms. Greene converted $40,000 of funds advanced to the Company to 4,000,000 Series A Preferred shares at a par value of $0.01 per share. During the year ended December 31, 2019, Ms. Greene advanced the company a net $560,824 to fund working capital requirements. The amount owing to Ms. Greene is non-interest bearing and has no fixed repayment terms. All related party transactions occur in the normal course of operations and in terms of agreements entered into between the parties. |
Stockholders' deficit
Stockholders' deficit | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
Stockholders' deficit | 18. Stockholder’s deficit Authorized, issued and outstanding On September 20, 2019, in terms of a shareholders resolution and Article of Amendment filed with the Colorado Secretary of State, the Company increased its authorized common share capital to 900,000,000 shares with a par value of $0.01 per share. On January 6, 2020, the majority of the shareholders of the Company approved an increase in the authorized number of common shares from 900,000,000 to 10,000,000,000 with a par value of $0.01 per share. · Ten billion shares of common stock, par value $0.01 per share; · Ten million shares of Series A Preferred stock, par value $0.01 per share; and · Four hundred thousand Series B Preferred stock, par value $1.00 per share. Series A Preferred stock The salient terms of the Series A Preferred stock is summarized as follows: · Convertible into ten shares of common stock six months after the date of issue · No participation in the profits and losses of the corporation · No dividend entitlement · Upon redemption, repurchase or conversion, the Series A Preferred shares shall be cancelled and will not be eligible for reissue. Series B Preferred stock The salient terms of the Series B Preferred stock is summarized as follows: · Series B Preferred stock will rank senior to all other classes of stock · Entitled to cumulative dividends at 6% per annum payable in cash or in kind, monthly on the last day of each month, calculated on 360 day year consisting of 12, 30-day periods. · No voting rights other than on (i) amendment to the articles of incorporation; (ii) mergers, consolidations or reorganizations; (iii) a sale of substantially all of the assets of the Company; (iv) change of the rights and preferences of the Series B preferred stock; (v) fundamental transactions entered into or liquidation of the Company; · Redeemable at the option of the Company, one year from date of issue; · Mandatorily redeemable one year after the date of issuance; · Entitled to participate in any future debt or equity offerings as longs as 10% of the Series B Preferred stock is outstanding. a) Common shares Authorized and outstanding The Company has authorized 10,000,000,000 shares with a par value of $0.01 per share. The company has issued and outstanding 2,027,085,665 and 155,483,897 at December 31, 2020 and 2019, respectively. On January 17, 2019, the Company issued 71,111 shares of common stock to Leonite in connection with the closing of a financing of a Senior Secured Convertible Note. The shares were valued at $4,978 on the issue date and recorded as a debt discount. On May 15, 2019, a Series N convertible note holder converted an aggregate principal amount of $950,000 of principal debt into 11,875,000 at a conversion price of $0.08 per share. During June 2019, the Company issued a total of 5,300,000 shares of common stock to certain consultants, directors and employees for services rendered during the course of the current fiscal year. These shares of common stock were valued at $371,000 at the date of grant. During June 2019, the Company issued a total of 2,050,000 shares of common stock to certain investors as bonus shares. These shares were valued at $0.07 per share on the date of issuance. Between September 11, 2019 and December 30, 2019 in terms of conversion notices received from First Fire Global Opportunities Fund, the Company issued 11,887,445 shares of common stock to settle $36,592 of convertible debt. Between January 6, 2020 and December 28, 2020, the Company issued 1,586,659,618 shares of common stock upon receipt of conversion notices received from convertible note holders. The shares issued were issued below par based on the market price of the stock on the date of conversion and were valued at $1,137,259. The difference between the conversion price and market price is reflected as finance costs. On January 8, 2020, the Company recorded the issuance of 2,700,000 shares to Labrys Fund. These shares were originally issued to Labrys fund as shares returnable to the Company dependent on settlement of the convertible note at maturity. The Company did not settle the convertible note or interest thereon at maturity. Between January 6, 2020 and May 2, 2020, the Company issued 184,000,000 shares of common stock to Leonite Capital LLC in terms of the exercise of 224,390,247 warrants valued at $95,868 at an average exercise price of 0.00043 per share, based on the price protection afforded to the warrant holder. On June 12, 2020, the Company issued 100,000,000 shares to Ethan Leon for proceeds of $25,000 allocated to him by Ms. Eileen Greene from her related party advance to the Company. On December 9, 2020, the Company cancelled 1,757,850 shares of common stock previously issued to Mr. Leon, our CEO, as compensation for certain advances to the Company in prior periods. These advances were reinstated as owing to Mr. Leon in the prior year. b) Series A Preferred shares Authorized, issued and outstanding The Company has authorized 10,000,000 Series A preferred shares with a par value of $0.01 per share. During December 2020, the Company issued 4,000,000 Series A Preferred shares, par value $0.01 per share to Ms. Eileen Greene, for gross proceeds of $40,000 out of related party proceeds previously advanced to the Company by Ms. Greene. c) Series B Preferred shares Authorized and outstanding The Company has authorized 400,000 Series B preferred shares with a par value of $1.00 per share. With effect from June 12, the Company issued 400,000 Series B shares at a par value of $1.00 per share to Leonite, in settlement of $400,000 of the convertible note owing to Leonite. d) Warrants The Company issued warrants to Leonite with an initial exercise price of $0.10 per share. The terms of these warrants included a price protection in the form of a reduction in the exercise price should the Company issue any stock at a price below the exercise price. The Company subsequently issued common stock at a price of $0.0000324 per share thereby triggering the price protection clause in the warrant agreement, resulting in an additional 152,017,272,726 warrants exercisable over shares of common stock. Leonite exercised warrants for the cashless purchase of 224,338,247 shares of common stock resulting in the issue of 184,000,000 shares of common stock. The remaining Leonite warrants exercisable for 154,300,675,861 shares of common stock were cancelled in terms of the debt extinguishment agreement entered into with Leonite and the Company issued a five year warrant exercisable for 326,286,847 shares of common stock, exercisable at $0.10 per share or the lowest volume weighted average price over a 30 day period preceding the date of issuance, exercise or twenty four month anniversary of issuance. In conjunction with the issuance of a convertible note to Auctus, the Company issued a five year warrant exercisable for 66,666,666 shares of common stock at an exercisable price of $0.0015 per share subject to anti-dilution and price protection adjustments. The Company also issued a second five year warrant exercisable for 66,666,666 shares of common stock at an exercisable price of $0.0015 per share subject to anti-dilution and price protection adjustments, which warrants will only be exercisable upon an event of default on the convertible note. In connection with the issuance of the convertible promissory note to Labrys, the Company granted Labrys a five-year warrant for 100,000,000 shares of common stock at an exercise price of $0.00205 per share. A summary of all of the Company’s warrant activity during the period January 1, 2019 to December 31, 2020 is as follows: No. of shares Exercise price per Weighted average exercise price Outstanding as of January 1, 2019 97,499,908 $0.003 to $0.12 $ 0.0910000 Granted 27,700,652 $0.10 to $0.12 0.1177300 Adjustment due to price protection 2,456,534,397 $ 0.00204 0.0020400 Forfeited/cancelled (15,633,709 ) 0.03 0.0300000 Exercised — — — Outstanding as of December 31, 2019 2,566,101,248 $0.00204 to $0.12 $ 0.0044700 Granted 233,333,332 0.0017357 0.0017357 Adjustment due to price protection 152,017,272,726 0.0000324 0.0000324 Forfeited/cancelled (2,366,666 ) 0.0300000 0.0300000 Granted in terms of debt extinguishment 326,286,847 0.000675 0.0006750 Cancelled as part of debt extinguishment (154,300,675,861 ) 0.0000324 0.0000324 Exercised (224,390,247 ) 0.0004 0.0004000 Outstanding as of December 31, 2020 615,561,379 $0.000675 to $0.12 $ 0.0113796 The warrants were valued using a Black Scholes pricing model on the date of grant at $1,477,163 using the following weighted average assumptions: Year ended December 31, 2020 Calculated stock price $0.00006 to $0.00205 Risk free interest rate 0.21% to 0.36% Expected life of warrants 36 to 60 months expected volatility of underlying stock 193.9% to 236.8% Expected dividend rate 0 % The volatility of the common stock is estimated using historical data of the Company’s common stock. The risk-free interest rate used in the Black Scholes pricing model is determined by reference to historical U.S. Treasury constant maturity rates with maturities approximate to the life of the warrants granted. An expected dividend yield of zero is used in the valuation model, because the Company does not expect to pay any cash dividends in the foreseeable future. The following table summarizes information about warrants outstanding at December 31, 2020: Warrants outstanding Warrants exercisable Exercise price No. of shares Weighted average remaining years Weighted average exercise price No. of shares Weighted average exercise price $0.00068 326,286,847 4.53 326,286,847 $0.03000 3,703,700 0.28 3,703,700 $0.00150 133,333,332 4.62 133,333,332 $0.00205 100,000,000 4.92 100,000,000 $0.12 52,237,500 0.89 52,237,500 615,561,379 4.28 $ 0.0113796 615,561,379 $ 0.0113796 All of the warrants outstanding as of December 31, 2020 are vested. The warrants outstanding as of December 31, 2020 have an intrinsic value of $1,333,427. e) Stock options Our board of directors adopted the Greenestone Healthcare Corporation 2013 Stock Option Plan (the “Plan”) to promote our long-term growth and profitability by (i) providing our key directors, officers and employees with incentives to improve stockholder value and contribute to our growth and financial success and (ii) enable us to attract, retain and reward the best available persons for positions of substantial responsibility. A total of 10,000,000 shares of our common stock have been reserved for issuance upon exercise of options granted pursuant to the Plan. The Plan allows us to grant options to our employees, officers and directors and those of our subsidiaries; provided that only our employees and those of our subsidiaries may receive incentive stock options under the Plan. We No options were issued, exercised during the year ended December 31, 2020 and 2019, respectively. |
Segment information
Segment information | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment information | 19. Segment information The Company has two reportable operating segments: a. Rental income from the property owned by CCH subsidiary located at 3571 Muskoka Road, #169, Bala, on which the operations of the Canadian Rehab Clinic were located prior to disposal on February 14, 2017 and subsequently leased to the purchasers of the business of the Canadian Rehab Clinic, for a period of 5 years renewable for a further three five-year periods and with an option to acquire the property at a fixed price. b. Rehabilitation Services provided to customers, these services were provided to customers at our Addiction Recovery Institute of America and Seastone of Delray operations. The segment operating results of the reportable segments for the year ended December 31, 2020 is disclosed as follows: Year ended December 31, 2020 Rental Operations In-Patient services Total Revenue $ 338,996 $ — $ 338,996 Operating expenditure (134,387 ) (367,953 ) (502,340 ) Operating income (loss) 204,609 (367,953 ) (163,344 ) Other (expense) income Other income — 1,183 1,183 Gain on extinguishment of debt — 12,601,823 12,601,823 Gain on sale of assets — 36,470 36,470 Loss on debt conversion — (585,351 ) (585,351 ) Warrants exercised — (95,868 ) (95,868 ) Interest income — 629 629 Interest expense (241,815 ) (389,610 ) (631,425 ) Amortization of debt discount — (861,657 ) (861,657 ) Change in fair value of derivative liability — (7,041,968 ) (7,041,968 ) Foreign exchange movements (77,562 ) (97,938 ) (175,500 ) Net income (loss) before taxation (114,768 ) 3,199,760 3,084,992 Taxation — — — Net income (loss) $ (114,768 ) $ 3,199,760 $ 3,084,992 The operating assets and liabilities of the reportable segments as of December 31, 2020 is as follows: December 31, 2020 Rental Operations In-Patient services Total Purchase of fixed assets — — — Assets Current assets 40,912 894,241 935,153 Non-current assets 2,882,220 5,094 2,887,314 Liabilities Current liabilities (1,584,724 ) (12,280,077 ) (13,864,801 ) Non-current liabilities (4,583,765 ) — (4,583,765 ) Intercompany balances 1,287,681 (1,287,681 ) — Net liability position (1,957,676 ) (12,668,423 ) (14,626,099 ) The segment operating results of the reportable segments for the year ended December 31, 2019 is disclosed as follows: Year ended December 31, 2019 Rental Operations In-Patient services Total Revenue $ 331,584 $ 28,363 $ 359,947 Operating expenditure (17,200 ) (4,542,482 ) (4,559,682 ) Operating income (loss) 314,384 (4,514,119 ) (4,199,735 ) Other (expense) income Other income - 6,600 6,600 Loss on sale of assets - (1,019,812 ) (1,019,812 ) Penalty on convertible notes - (569,628 ) (569,628 ) Loss on debt conversion - (203,981 ) (203,981 ) Deposit forfeited - (1,665,078 ) (1,665,078 ) Interest income - 17,226 17,226 Interest expense (396,100 ) (682,938 ) (1,079,038 ) Amortization of debt discount - (3,338,760 ) (3,338,760 ) Change in fair value of derivative liability - (2,599,029 ) (2,599,029 ) Foreign exchange movements (38,992 ) (272,614 ) (311,606 ) Net loss before taxation (120,708 ) (14,842,133 ) (14,962,841 ) Taxation - - - Net loss $ (120,708 ) $ (14,842,133 ) $ (14,962,841 ) The operating assets and liabilities of the reportable segments as of December 31, 2019 is as follows: December 31, 2019 Rental Operations In-Patient services Total Purchase of fixed assets 72,386 22,868 95,254 Assets Current assets 4,230 251,212 255,442 Non-current assets 2,955,637 — 2,955,637 Liabilities Current liabilities (1,280,442 ) (17,295,416 ) (18,575,858 ) Non-current liabilities (4,655,765 ) — (4,655,765 ) Intercompany balances 596,872 (596,872 ) — Net liability position (2,379,468 ) (17,641,076 ) (20,020,544 ) |
Net (loss) income per common sh
Net (loss) income per common share | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Net (loss) income per common share | 20. Net (loss) income per common share For the year ended December 31, 2019, the following options, warrants and convertible securities were excluded from the computation of diluted net loss per share as the results would have been anti-dilutive. Year ended Stock options — Warrants to purchase shares of common stock 2,566,101,248 Convertible notes 1,046,179,457 3,612,280,705 |
Commitments and contingencies
Commitments and contingencies | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and contingencies | 21. Commitments and contingencies a. Contingency related to outstanding penalties The Company has provided for potential US penalties of $250,000 due to non-compliance with the filing of certain required returns. The actual liability may be higher due to interest and penalties assessed by these taxing authorities. b. Mortgage loans The company has a mortgage loans as disclosed in note 13 above. The future commitment under this loans is as follows: Amount 2021 115,704 2022 3,848,077 Total $ 3,963,781 c. Other The Company has principal and interest payment commitments under the Convertible notes disclosed under Note 12 above. Conversion of these notes are at the option of the investor, if not converted these notes may need to be repaid. From time to time, the Company and its subsidiaries enter into legal disputes in the ordinary course of business. The Company believes there are no material legal or administrative matters pending that are likely to have, individually or in the aggregate, a material adverse effect on its business or results of operations. |
Income taxes
Income taxes | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income taxes | 22. Income taxes The Company is current in its US tax filings, except for its 2019 filing, as of December 31, 2020 and is not current in its Canadian tax filings with the 2016 and 2017 returns still outstanding. The income tax provision/ (benefit) is different from that which would be obtained by applying the statutory Federal income tax rate of 21% and applicable state tax rates of 5% to income before income tax expense. The items causing this difference for the years ended December 31, 2020 and 2019 are as follows: Year ended December 31, 2020 Year ended December 31, 2019 Tax credit at the federal and state statutory rate 857,250 (3,854,992 ) Foreign taxation (56,212 ) (62,163 Permanent differences (1,091,032 ) 1,569,469 Foreign tax rate differential 1,061 1,173 Valuation allowance 288,933 2,346,513 — — Deferred income taxes reflect the net tax effect of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of deferred tax assets and liabilities at December 31, 2020 and 2019 are as follows: December 31, December 31, Net operating losses Net operating loss carry forward 32,968,411 24,023,480 Prior year adjustment to opening balances 150,639 — Foreign exchange differential 48,579 68,923 Net taxable loss 1,111,286 8,876,008 Valuation allowance (34,278,915 ) (32,968,411 ) — — The company has established a valuation allowance against its gross deferred tax assets sufficient to bring its net deferred tax assets to zero due to the uncertainty surrounding the realization of such assets. Management has determined it is more likely than not that the net deferred tax assets are not realizable due to the Company’s historical loss position. The valuation allowance for the year ended December 31, 2020 increased by $1,310,504 due to the additional taxation losses incurred for the year ended December 31, 2020 and adjustments made to prior year opening balances. As of December 31, 2020, the prior three tax years remain open for examination by the federal or state regulatory agencies for purposes of an audit for tax purposes. Pursuant to the Internal Revenue Code of 1986, as amended (“IRC”), §382, the Company’s ability to use its net operating loss carry forwards to offset future taxable income is limited if the Company experiences a cumulative change in ownership of more than 50% within a three-year period. As of December 31, 2020, the Company is in arrears on certain US and Canadian tax filings and the amounts presented above are based on estimates. The actual losses available could differ from these estimates. In addition, the Company could be subject to penalties for these unfiled tax returns. As of December 31, 2020 and 2019, the Company has accrued $250,000 in penalties and interest attributable to delinquent tax returns. Management believes the Company has adequately provided for any ultimate amounts that are likely to result from audits of these returns once filed; however, final assessments, if any, could be significantly different than the amounts recorded in the financial statements. The Company operates in foreign jurisdictions and is subject to audit by taxing authorities. These audits may result in the assessment of amounts different than the amounts recorded in the consolidated financial statements. The Company liaises with the relevant authorities in these jurisdictions in regard to its income tax and other returns. Management believes the Company has adequately provided for any taxes, penalties and interest that may fall due. The Tax Cuts and Jobs Act (the “Act”) was signed into law on December 22, 2017 and significantly changes tax law in the United States by, among other items, reducing the federal corporate income tax rate from a maximum of 35% to 21% (effective January 1, 2018). The Act embraces a territorial system for the taxation of future foreign earnings and modifies certain business deductions by, among other changes, repealing the domestic production activities deduction, further limiting the deductibility of certain executive compensation and increasing the limitation on the deductibility of certain meals and entertainment expenses. On the other hand, the Act permits 100% bonus depreciation on assets placed in service through 2022 (with a phase-out period through 2026). The full effects of these changes will be reflected for the first time in the determination of income tax expense for the year ending December 31, 2018. The Company determined that it had no liability as of December 31, 2018 for the one-time transition tax on deemed repatriated earnings of foreign subsidiaries imposed by the Act. |
Subsequent events
Subsequent events | 12 Months Ended |
Dec. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent events | 23. Subsequent events On January 8, 2021, Leonite converted the remaining balance of the Leonite on demand note in the aggregate principal amount of $70,000 plus accrued interest thereon into 78,763,466 shares of common stock at a conversion price of $0.0009 per share, thereby extinguishing the note. On March 3, 2021, the Company received a notice of conversion, converting principal and interest in the aggeregate principal amount of $95,000 of the Leonite convertible loan advanced to the Company on July 12, 2020 into 97,000,000 shares of common stock at a conversion price of $0.001 per share. On March 9, 2021, the Company received a cashless warrant exercise from Auctus Fund, LLC whereby warrants for 66,666,666 shares were exercised at an exercise price of $0.0015 for 59,999,999 net shares. On January 12, 2021, CCH received a further CDN$ 20,000 Covid-19 related government assistance loan. The loan is interest free and if repaid by December 31, 2022, CDN$ 10,000 is forgivable. Subsequent to year end, Leonite has advanced the Company an additional $290,000 to the Company for working capital purposes, the option to acquire shares in ATHI from the Company has increased from 4,000,000 to 6,666,667 shares. The Company intends to continue its operations at a new location in west Palm Beach. A Letter of Intent ("LOI") was signed on February 7, 2020, with a third party that has a property lease and a pending license at its new location. The Company originally anticipated recommencing operations in February 2020, however it has been adversely affected by the COVID-19 pandemic. The LOI requires the Company to provide a working capital loan of up to $500,000, to date the Company has loaned $690,449 as of December 31, 2020. The Company is expected to close on the acquisition shortly. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Use of Estimates | a) Use of Estimates The preparation of consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. |
Principles of consolidation and foreign currency translation | b) Principals of consolidation and foreign currency translation The accompanying consolidated financial statements include the accounts of the Company and all of its subsidiaries. All intercompany transactions and balances have been eliminated on consolidation. Certain of the Company’s subsidiaries functional currency is the Canadian dollar, while the Company’s reporting currency is the U.S. dollar. All transactions initiated in Canadian dollars are translated into US dollars in accordance with ASC 830, “Foreign Currency Translation” as follows: ● Monetary assets and liabilities at the rate of exchange in effect at the balance sheet date. ● Non-monetary, non-current and equity at historical rates. ● Revenue and expense items and cash flows at the average rate of exchange prevailing during the period. Adjustments arising from such translations are deferred until realization and are included as a separate component of stockholders’ deficit as a component of accumulated other comprehensive income or loss. Therefore, translation adjustments are not included in determining net income (loss) but reported as other comprehensive income (loss). For foreign currency transactions, the Company translates these amounts to the Company’s functional currency at the exchange rate effective on the invoice date. If the exchange rate changes between the time of purchase and the time actual payment is made, a foreign exchange transaction gain or loss results which is included in determining net income for the period. The relevant translation rates are as follows: For the year ended December 31, 2020 a closing rate of CDN$1.0000 equals US$0.7854 and an average exchange rate of CDN$1.0000 equals US$0.7455. For the year ended December 31, 2019 a closing rate of CAD$1.0000 equals US$0.7699 and an average exchange rate of CAD$1.0000 equals US$0.7536. |
Revenue Recognition | c) Revenue Recognition ASC 606 requires companies to exercise more judgment and recognize revenue using a five-step process. The Company’s provision for doubtful accounts are recorded as a direct reduction to revenue instead of being presented as a separate line item on the consolidated statements of operations and comprehensive loss. As our performance obligations relate to contracts with a duration of one year or less, the Company elected the optional exemption in ASC 606-10-50-14(a). Therefore, the Company is not required to disclose the transaction price for the remaining performance obligations at the end of the reporting period or when the Company expects to recognize the revenue. The Company has minimal unsatisfied performance obligations at the end of the reporting period as our patients typically are under no obligation to remain admitted in our facilities. The Company receives payments from the following sources for services rendered in our U.S. Facility: (i) commercial insurers; and (ii) individual patients and clients. As the period between the time of service and time of payment is typically one year or less, the Company elected the practical expedient under ASC 606-10-32-18 and does not adjust for the effects of a significant financing component. The Company derives a significant portion of its revenue from other payors that receive discounts from established billing rates. The various managed care contracts under which these discounts must be calculated are complex, subject to interpretation and adjustment, and may include multiple reimbursement mechanisms for different types of services provided in the Company’s inpatient facilities and cost settlement provisions. Management estimates the transaction price on a payor-specific basis given its interpretation of the applicable regulations or contract terms. The services authorized and provided and related reimbursement are often subject to interpretation that could result in payments that differ from the Company’s estimates. Additionally, updated regulations and contract renegotiations occur frequently, necessitating regular review and assessment of the estimation process by management. Settlements with third-party payors are estimated and recorded in the period in which the related services are rendered and are adjusted in future periods as final settlements are determined. In the opinion of management, adequate provision has been made for any adjustments and final settlements. However, there can be no assurance that any such adjustments and final settlements will not have a material effect on the Company’s financial condition or results of operations. The Company’s receivables were $3,075 and $105,842 for the years ended December 31, 2020 and 2019, respectively. Management believes that these receivables are properly stated and are not likely to be settled for a significantly different amount. The net adjustments to estimated settlements resulted in a a credit to revenues of $2,734 and a charge to revenues of $414,603 for the years ended December 31, 2020 and 2019, respectively. The credit to revenue is due to revenue collected from commercial insurers in excess of our expectations. The Company’s revenues are recognized when control of the promised goods or services are transferred to a customer, in an amount that reflects the consideration that the Company expects to receive in exchange for those services. The Company derives its revenues from the sale of its services. The Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its revenue transactions: i. identify the contract with a customer; ii. identify the performance obligations in the contract; iii. determine the transaction price; iv. allocate the transaction price to performance obligations in the contract; and v. recognize revenue as the performance obligation is satisfied. |
Cash and cash equivalents | d) Cash and cash equivalents For purposes of the statements of cash flows, the Company considers all highly liquid instruments purchased with a maturity of three months or less and money market accounts to be cash equivalents. The Company maintains cash and cash equivalents with several financial institution in the USA and Canada. The Company primarily places cash balances in the USA with high-credit quality financial institutions located in the United States which are insured by the Federal Deposit Insurance Corporation up to a limit of $250,000 per institution, in Canada which are insured by the Canadian Deposit Insurance Corporation up to a limit of CDN$100,000 per institution. |
Accounts receivable | e) Accounts receivable Accounts receivable primarily consists of amounts due from third-party payors (non-governmental) and private pay patients and is recorded net of allowances for doubtful accounts and contractual discounts. The Company’s ability to collect outstanding receivables is critical to its results of operations and cash flows. Accordingly, accounts receivable reported in the Company’s consolidated financial statements is recorded at the net amount expected to be received. The Company’s primary collection risks are (i) the risk of overestimating net revenues at the time of billing that may result in the Company receiving less than the recorded receivable, (ii) the risk of non-payment as a result of commercial insurance companies denying claims, (iii) the risk that patients will fail to remit insurance payments to the Company when the commercial insurance company pays out-of-network claims directly to the patient, (iv) resource and capacity constraints that may prevent the Company from handling the volume of billing and collection issues in a timely manner, (v) the risk that patients do not pay the Company for their self-pay balances (including co-pays, deductibles and any portion of the claim not covered by insurance) and (vi) the risk of non-payment from uninsured patients. |
Allowance for Doubtful Accounts, Contractual and Other Discounts | f) Allowance for Doubtful Accounts, Contractual and Other Discounts The Company derives the majority of its revenues from commercial payors at out-of-network rates. Management estimates the allowance for contractual and other discounts based on its historical collection experience. The services authorized and provided and related reimbursement are often subject to interpretation and negotiation that could result in payments that differ from the Company’s estimates. The Company’s allowance for doubtful accounts is based on historical experience, but management also takes into consideration the age of accounts, creditworthiness and current economic trends when evaluating the adequacy of the allowance for doubtful accounts. An account is written off only after the Company has pursued collection efforts or otherwise determines an account to be uncollectible. Uncollectible balances are written-off against the allowance. Recoveries of previously written-off balances are credited to income when the recoveries are made. |
Financial instruments | g) Financial instruments The Company initially measures its financial assets and liabilities at fair value, except for certain non-arm’s length transactions. The Company subsequently measures all its financial assets and financial liabilities at amortized cost. Financial assets measured at amortized cost include cash and accounts receivable. Financial liabilities measured at amortized cost include bank indebtedness, accounts payable and accrued liabilities, harmonized sales tax payable, withholding taxes payable, convertible notes payable, loans payable and related party notes. Financial assets measured at cost are tested for impairment when there are indicators of impairment. The amount of the write-down is recognized in net income. The previously recognized impairment loss may be reversed to the extent of the improvement, directly or by adjusting the allowance account, provided it is no greater than the amount that would have been reported at the date of the reversal had the impairment not been recognized previously. The amount of the reversal is recognized in net income. The Company recognizes its transaction costs in net income in the period incurred. However, financial instruments that will not be subsequently measured at fair value are adjusted by the transaction costs that are directly attributable to their origination, issuance or assumption. FASB ASC 820 defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles, and expands disclosures about fair value measurements. ASC 820 establishes a three tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: ● Level 1. Observable inputs such as quoted prices in active markets; ● Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and ● Level 3. Unobservable inputs in which there is little or no market data, which requires the reporting entity to develop its own assumptions. The Company measures its convertible debt and derivative liabilities associated therewith at fair value. These liabilities are revalued periodically and the resultant gain or loss is realized through the Statement of Operations and Comprehensive Loss. |
Property and equipment | h) Property and equipment Property and equipment is recorded at cost. Depreciation is calculated on the straight line basis over the estimated life of the asset: Building improvements are depreciated using the straight-line method over the term of the lease. |
Leases | i) Leases The Company accounts for leases in terms of AC 842 whereby leases are classified as either capital or operating leases. Leases that transfer substantially all of the benefits and inherent risks of ownership of property to the Company are accounted for as capital leases. At the time a capital lease is entered into, an asset is recorded together with its related long-term obligation to reflect the acquisition and financing. Equipment recorded under capital leases is amortized on the same basis as described above. Operating leases are recognized on the balance sheet as a lease liability with a corresponding right of use asset for all leases with a term that is more than twelve months. Payments under operating leases are expensed as incurred. |
Income taxes | j) Income taxes The Company accounts for income taxes under the provisions of ASC Topic 740, “Income Taxes”. ASC Topic 740 contains a two-step approach to recognizing and measuring uncertain tax positions taken or expected to be taken in a tax return. The first step is to determine if the weight of available evidence indicates that it is more likely than not that the tax position will be sustained in an audit, including resolution of any related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. The Company recognizes interest and penalties accrued on unrecognized tax benefits within general and administrative expense. To the extent that accrued interest and penalties do not ultimately become payable, amounts accrued will be reduced and reflected as a reduction in general and administrative expenses in the period that such determination is made. The tax returns for fiscal 2016, through 2019 are subject to audit or review by the US tax authorities, whereas fiscal 2010 through 2017 are subject to audit or review by the Canadian tax authority. |
Net income (loss) per Share | k) Net income (loss) per Share Basic net income (loss) per share is computed on the basis of the weighted average number of common stock outstanding during the period. Diluted net income (loss) per share is computed on the basis of the weighted average number of common stock and common stock equivalents outstanding. Dilutive securities having an anti-dilutive effect on diluted net income (loss) per share are excluded from the calculation. Dilution is computed by applying the treasury stock method for options and warrants. Under this method, “in-the money” options and warrants are assumed to be exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase common stock at the average market price during the period. Dilution is computed by applying the if-converted method for convertible preferred stocks. Under this method, convertible preferred stock is assumed to be converted at the beginning of the period (or at the time of issuance, if later), and preferred dividends (if any) will be added back to determine income applicable to common stock. The shares issuable upon conversion will be added to weighted average number of common stock outstanding. Conversion will be assumed only if it reduces earnings per share (or increases loss per share). |
Stock based compensation | l) Stock based compensation Stock based compensation cost is measured at the grant date, based on the estimated fair value of the award and is recognized as expense over the employee’s requisite service period or vesting period on a straight-line basis. Share-based compensation expense recognized in the consolidated statements of operations for the year ended December 31, 2020 and 2019 is based on awards ultimately expected to vest and has been reduced for estimated forfeitures. This estimate will be revised in subsequent periods if actual forfeitures differ from those estimates. We have minimal awards with performance conditions and no awards dependent on market conditions. |
Derivatives | m) Derivatives The Company evaluates embedded conversion features within convertible debt under ASC 815 “Derivatives and Hedging” to determine whether the embedded conversion feature should be bifurcated from the host instrument and accounted for as a derivative at fair value with changes in fair value recorded in earnings. The Company uses a Black Scholes Option Pricing model to estimate the fair value of convertible debt conversion features at the end of each applicable reporting period. Changes in the fair value of these derivatives during each reporting period are included in the statements of operations. Inputs into the Black Scholes Option Pricing model require estimates, including such items as estimated volatility of the Company’s stock, risk free interest rate and the estimated life of the financial instruments being fair valued. If the conversion feature does not require derivative treatment under ASC 815, the instrument is evaluated under ASC 470-20 “Debt with Conversion and Other Options” for consideration of any beneficial conversion feature. |
Recent accounting pronouncements | n) Recent accounting pronouncements In August 2020, the FASB issued ASU No. 2020-06, debt with Conversion and Other Options (subtopic 470-20): and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40). Certain accounting models for convertible debt instruments with beneficial conversion features or cash conversion features are removed from the guidance and for equity instruments the contracts affected are free standing instruments and embedded features that are accounted for as derivatives, the settlement assessment was simplified by removing certain settlement requirements. This ASU is effective for fiscal years and interim periods beginning after December 15, 2021. The effects of this ASU on the Company’s consolidated financial statements is currently being assessed and is expected to have an impact on the treatment of certain convertible instruments, if any, and the derivative liabilities, if any, associated with these convertible instruments. The FASB issued several additional updates during the period, none of these standards are either applicable to the Company or require adoption at a future date and none are expected to have a material impact on the consolidated financial statements upon adoption. |
Financial instrument Risks | o) Financial instruments Risks The Company is exposed to various risks through its financial instruments. The following analysis provides a measure of the Company’s risk exposure and concentrations at the balance sheet date, December 31, 2020 and 2019. i. Credit risk Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation. Financial instruments that subject the Company to credit risk consist primarily of accounts receivable. Credit risk associated with accounts receivable is mitigated as only a percentage of the revenue billed to health insurance companies is recognized as income until such time as the actual funds are collected. The revenue is concentrated amongst several health insurance companies located in the US. In the opinion of management, credit risk with respect to accounts receivable is assessed as low. ii. Liquidity risk Liquidity risk is the risk the Company will not be able to meet its financial obligations as they fall due. The Company is exposed to liquidity risk through its working capital deficiency of $12,929,648, which includes derivative liabilities of $4,765,387, and an accumulated deficit of $42,459,781. The Company is dependent upon the raising of additional capital in order to implement its business plan. There is no assurance that the Company will be successful with future financing ventures, and the inability to secure such financing may have a material adverse effect on the Company’s financial condition. In the opinion of management, liquidity risk is assessed as high, material and remains unchanged from that of the prior year. iii. Market risk Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises of three types of risk: interest rate risk, currency risk, and other price risk. The Company is exposed to interest rate risk and currency risk. a. Interest rate risk Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is exposed to interest rate risk on its convertible debt, mortgage loans, short term loans, third party loans and government assistance loans as of December 31, 2020. In the opinion of management, interest rate risk is assessed as moderate. b. Currency risk Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Company is subject to currency risk as it has subsidiaries that operate in Canada and are subject to fluctuations in the Canadian dollar. A substantial portion of the Company’s financial assets and liabilities are denominated in Canadian dollars. Based on the net exposures at December 31, 2020, a 5% depreciation or appreciation of the Canadian dollar against the U.S. dollar would result in an approximate $10,606 increase or decrease in the Company’s after tax net income from operations. The Company has not entered into any hedging agreements to mitigate this risk. In the opinion of management, currency risk is assessed as low, material and remains unchanged from that of the prior year. c. Other price risk Other price risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices (other than those arising from interest rate risk or currency risk), whether those changes are caused by factors specific to the individual financial instrument or its issuer, or factors affecting all similar financial instruments traded in the market. In the opinion of management, the Company is not exposed to this risk and remains unchanged from the prior year. |
Sale of property (Tables)
Sale of property (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Notes to Financial Statements | |
Schedule of sale of property | The loss realized on the disposal was calculated as follows: Amount Proceeds received $ 4,975,174 Less: closing costs (182,344 ) Provision for additional expenses (36,470 ) Net proceeds received 4,756,360 Assets sold: Land 2,753,928 Buildings thereon, net of depreciation 2,949,452 Furniture and fixtures, net of depreciation 72,792 5,776,172 Loss on disposal of property $ 1,019,812 |
Property and equipment (Tables)
Property and equipment (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | Property and equipment consists of the following: December 31, December 31, 2019 Cost Accumulated depreciation Net book value Net book value Land $ 168,866 $ — $ 168,866 $ 165,537 Property 3,194,427 (481,073 ) 2,713,354 2,785,131 $ 3,363,293 $ (481,073 ) $ 2,882,220 $ 2,950,668 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Schedule of operating leases | Individual components of the total lease cost incurred by the Company is as follows: Year ended December 31, 2020 Year ended December 31, Operating lease expense $ 5,512 $ 1,360,117 |
Taxes Payable (Tables)
Taxes Payable (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Notes to Financial Statements | |
Schedule of taxation payable | December 31, December 31, Payroll taxes $ 143,410 $ 140,583 HST/GST payable 73,503 26,524 US penalties due 250,000 250,000 Income tax payable 383,364 375,808 $ 850,277 $ 792,915 |
Short-term Convertible Notes (T
Short-term Convertible Notes (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of short-term convertible notes | The short-term convertible notes consist of the following: Interest rate Maturity Date Principal Interest Debt Discount December 31, 2020 December 31, 2019 Leonite Capital, LLC 8.5 % On demand $ 70,000 $ 583 $ - $ 70,583 $ 1,213,148 6.5 % June 12, 2021 396,000 9,060 (258,002 ) 147,058 — Power Up Lending Group Ltd — — — — — — 33,707 — — — — — — 51,827 First Fire Global Opportunities Fund — — — — — — 247,361 6.5 % October 29,2021 137,500 1,564 (113,767 ) 25,297 — Auctus Fund, LLC 10.0 % May 7, 2020 150,000 — — 150,000 129,016 10.0 % August 13, 2021 95,000 3,764 (58,562 ) 40,202 — Labrys Fund, LP — — — — — — 286,057 12.0 % November 30, 2021 275,000 2,803 (251,644 ) 26,159 — Ed Blasiak 6.5 % September 14, 2021 55,000 1,073 (38,726 ) 17,347 — Joshua Bauman 6.5 % September 14, 2021 137,500 2,562 (96,815 ) 43,247 — Geneva Roth Remark Holdings, Inc. 9.0 % August 29, 2021 88,000 1,001 (69,763 ) 19,238 — 9.0 % October 15, 2021 53,000 477 (46,724 ) 6,753 — Series N convertible notes 6.0 % On Demand 3,229,000 425,333 — 3,654,333 3,079,997 $ 4,200,217 $ 5,041,113 |
Mortgage loans (Tables)
Mortgage loans (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Payables and Accruals [Abstract] | |
Schedule of mortgage loans | Loans payable is disclosed as follows: Interest rate Maturity date Principal Outstanding Accrued interest December 31, 2020 December 31, 2019 Cranberry Cove Holdings, Ltd. Pace Mortgage 4.2 % July 19, 2022 $ 3,958,315 $ 5,466 $ 3,963,781 $ 3,995,235 $ 3,989,726 $ 5,509 $ 3,963,781 $ 3,995,235 Disclosed as follows: Short-term portion $ 115,704 $ 114,290 Long-term portion 3,848,077 3,880,945 $ 3,963,781 $ 3,995,235 The aggregate amount outstanding is payable as follows: Amount 2021 115,704 2022 3,848,077 Total $ 3,963,781 |
Derivative liability (Tables)
Derivative liability (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Notes to Financial Statements | |
Schedule of assumption used in Black Scholes | The following assumptions were used in the Black-Scholes valuation model: Year ended Calculated stock price $0.0001 to $0.0034 Risk free interest rate 0.05% to 0.36% Expected life of convertible notes and warrants 3 to 60 months expected volatility of underlying stock 193.9% to 779.0% Expected dividend rate 0 % |
Schedule of derivative liability | The movement in derivative liability is as follows: December 31, December 31, Opening balance $ 8,694,272 $ 4,618,080 Derivative liability mark-to-market on convertible debt extinguishment 126,444,276 — Derivative liability on revised convertible notes and warrants arising from convertible debt extinguishment 6,349,265 — Derivative liability cancelled on debt extinguishment (144,893,444 ) — Derivative liability on issued convertible notes and variable priced warrants 1,129,050 1,477,163 Fair value adjustments to derivative liability 7,041,968 2,599,029 Closing balance $ 4,765,387 $ 8,694,272 |
Stockholders' deficit (Tables)
Stockholders' deficit (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
Schedule of warrants outstanding | A summary of all of the Company’s warrant activity during the period January 1, 2019 to December 31, 2020 is as follows: No. of shares Exercise price per Weighted average exercise price Outstanding as of January 1, 2019 97,499,908 $0.003 to $0.12 $ 0.0910000 Granted 27,700,652 $0.10 to $0.12 0.1177300 Adjustment due to price protection 2,456,534,397 $ 0.00204 0.0020400 Forfeited/cancelled (15,633,709 ) 0.03 0.0300000 Exercised — — — Outstanding as of December 31, 2019 2,566,101,248 $0.00204 to $0.12 $ 0.0044700 Granted 233,333,332 0.0017357 0.0017357 Adjustment due to price protection 152,017,272,726 0.0000324 0.0000324 Forfeited/cancelled (2,366,666 ) 0.0300000 0.0300000 Granted in terms of debt extinguishment 326,286,847 0.000675 0.0006750 Cancelled as part of debt extinguishment (154,300,675,861 ) 0.0000324 0.0000324 Exercised (224,390,247 ) 0.0004 0.0004000 Outstanding as of December 31, 2020 615,561,379 $0.000675 to $0.12 $ 0.0113796 The warrants were valued using a Black Scholes pricing model on the date of grant at $1,477,163 using the following weighted average assumptions: Year ended December 31, 2020 Calculated stock price $0.00006 to $0.00205 Risk free interest rate 0.21% to 0.36% Expected life of warrants 36 to 60 months expected volatility of underlying stock 193.9% to 236.8% Expected dividend rate 0 % The following table summarizes information about warrants outstanding at December 31, 2020: Warrants outstanding Warrants exercisable Exercise price No. of shares Weighted average remaining years Weighted average exercise price No. of shares Weighted average exercise price $0.00068 326,286,847 4.53 326,286,847 $0.03000 3,703,700 0.28 3,703,700 $0.00150 133,333,332 4.62 133,333,332 $0.00205 100,000,000 4.92 100,000,000 $0.12 52,237,500 0.89 52,237,500 615,561,379 4.28 $ 0.0113796 615,561,379 $ 0.0113796 |
Segment information (Tables)
Segment information (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Schedule of segment information | The segment operating results of the reportable segments for the year ended December 31, 2020 is disclosed as follows: Year ended December 31, 2020 Rental Operations In-Patient services Total Revenue $ 338,996 $ — $ 338,996 Operating expenditure (134,387 ) (367,953 ) (502,340 ) Operating income (loss) 204,609 (367,953 ) (163,344 ) Other (expense) income Other income — 1,183 1,183 Gain on extinguishment of debt — 12,601,823 12,601,823 Gain on sale of assets — 36,470 36,470 Loss on debt conversion — (585,351 ) (585,351 ) Warrants exercised — (95,868 ) (95,868 ) Interest income — 629 629 Interest expense (241,815 ) (389,610 ) (631,425 ) Amortization of debt discount — (861,657 ) (861,657 ) Change in fair value of derivative liability — (7,041,968 ) (7,041,968 ) Foreign exchange movements (77,562 ) (97,938 ) (175,500 ) Net income (loss) before taxation (114,768 ) 3,199,760 3,084,992 Taxation — — — Net income (loss) $ (114,768 ) $ 3,199,760 $ 3,084,992 The operating assets and liabilities of the reportable segments as of December 31, 2020 is as follows: December 31, 2020 Rental Operations In-Patient services Total Purchase of fixed assets — — — Assets Current assets 40,912 894,241 935,153 Non-current assets 2,882,220 5,094 2,887,314 Liabilities Current liabilities (1,584,724 ) (12,280,077 ) (13,864,801 ) Non-current liabilities (4,583,765 ) — (4,583,765 ) Intercompany balances 1,287,681 (1,287,681 ) — Net liability position (1,957,676 ) (12,668,423 ) (14,626,099 ) The segment operating results of the reportable segments for the year ended December 31, 2019 is disclosed as follows: Year ended December 31, 2019 Rental Operations In-Patient services Total Revenue $ 331,584 $ 28,363 $ 359,947 Operating expenditure ( 17,200 ) ( 4,542,482 ) (4,559,682 ) Operating income (loss) 314,384 (4,514,119 ) (4,199,735 ) Other (expense) income Other income - 6,600 6,600 Loss on sale of assets - (1,019,812 ) (1,019,812 ) Penalty on convertible notes - (569,628 ) (569,628 ) Loss on debt conversion - (203,981 ) (203,981 ) Deposit forfeited - (1,665,078 ) (1,665,078 ) Interest income - 17,226 17,226 Interest expense (396,100 ) (682,938 ) (1,079,038 ) Amortization of debt discount - (3,338,760 ) (3,338,760 ) Change in fair value of derivative liability - (2,599,029 ) (2,599,029 ) Foreign exchange movements (38,992 ) (272,614 ) (311,606 ) Net loss before taxation (120,708 ) (14,842,133 ) (14,962,841 ) Taxation - - - Net loss $ (120,708 ) $ (14,842,133 ) $ (14,962,841 ) The operating assets and liabilities of the reportable segments as of December 31, 2019 is as follows: December 31, 2019 Rental Operations In-Patient services Total Purchase of fixed assets 72,386 22,868 95,254 Assets Current assets 4,230 251,212 255,442 Non-current assets 2,955,637 — 2,955,637 Liabilities Current liabilities (1,280,442 ) (17,295,416 ) (18,575,858 ) Non-current liabilities (4,655,765 ) — (4,655,765 ) Intercompany balances 596,872 (596,872 ) — Net liability position (2,379,468 ) (17,641,076 ) (20,020,544 ) |
Net (loss) income per common _2
Net (loss) income per common share (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Net loss per common share (Tables) | For the year ended December 31, 2019, the following options. Warrants and convertible securities were excluded from the computation of diluted net loss per share as the results would have been anti-dilutive. Year ended Stock options — Warrants to purchase shares of common stock 2,566,101,248 Convertible notes 1,046,179,457 3,612,280,705 |
Commitments and contingencies (
Commitments and contingencies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of mortgage loans | The company has a mortgage loans as disclosed in note 11 above. The future commitment under this loans is as follows: Amount 2021 115,704 2022 3,848,077 Total $ 3,963,781 |
Income taxes (Tables)
Income taxes (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of reconciliation of income taxes | The income tax provision/ (benefit) is different from that which would be obtained by applying the statutory Federal income tax rate of 21% and applicable state tax rates of 5% to income before income tax expense. The items causing this difference for the years ended December 31, 2020 and 2019 are as follows: Year ended December 31, 2020 Year ended December 31, 2019 Tax credit at the federal and state statutory rate 857,250 (3,854,992 ) Foreign taxation (56,212 ) (62,163 Permanent differences (1,091,032 ) 1,569,469 Foreign tax rate differential 1,061 1,173 Valuation allowance 288,933 2,346,513 — — |
Schedule of deferred tax assets and liabilities | Deferred income taxes reflect the net tax effect of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of deferred tax assets and liabilities at December 31, 2020 and 2019 are as follows: December 31, December 31, Net operating losses Net operating loss carry forward 32,968,411 24,023,480 Prior year adjustment to opening balances 150,639 — Foreign exchange differential 48,579 68,923 Net taxable loss 1,111,286 8,876,008 Valuation allowance (34,278,915 ) (32,968,411 ) — — |
Going concern (Details Narrativ
Going concern (Details Narrative) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Working capital deficiency | $ 12,929,648 | |
Derivative liabilities | 4,765,387 | $ 8,694,272 |
Accumulated deficit | $ 42,459,781 |
Sale of property (Details)
Sale of property (Details) | Dec. 31, 2020USD ($) |
Notes to Financial Statements | |
Proceeds received | $ 4,975,174 |
Less: closing costs | (182,344) |
Provision for additional expenses | (36,470) |
Net proceeds received | 4,756,360 |
Assets sold: | |
Land | 2,753,928 |
Buildings thereon, net of depreciation | 2,949,452 |
Furniture and fixtures, net of depreciation | 72,792 |
Total | 5,776,172 |
Loss on disposal of property | $ 1,019,812 |
Property and equipment (Details
Property and equipment (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Cost | $ 3,363,293 | |
Accumulated depreciation | (481,073) | |
Net book value | 2,882,220 | $ 2,950,668 |
Land [Member] | ||
Cost | 168,866 | |
Accumulated depreciation | ||
Net book value | 168,866 | 165,537 |
Property [Member] | ||
Cost | 3,194,427 | |
Accumulated depreciation | (481,073) | |
Net book value | $ 2,713,354 | $ 2,785,131 |
Leases (Details)
Leases (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Leases [Abstract] | ||
Operating lease expense | $ 5,512 | $ 1,360,117 |
Taxes Payable (Details)
Taxes Payable (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Notes to Financial Statements | ||
Payroll taxes | $ 143,410 | $ 140,583 |
HST/GST payable | 73,503 | 26,524 |
US penalties due | 250,000 | 250,000 |
Income tax payable | 383,364 | 375,808 |
Taxes payable | $ 850,277 | $ 792,915 |
Short-term Convertible Notes (D
Short-term Convertible Notes (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Total | $ 4,200,217 | $ 5,041,113 |
Leonite Capital LLC [Member] | ||
Interest rate | 8.50% | |
Maturity date | On demand | |
Principal | $ 70,000 | |
Interest | 583 | |
Debt Discount | ||
Total | $ 70,583 | 1,213,148 |
Leonite Capital LLC 2[Member] | ||
Interest rate | 6.50% | |
Maturity date | June 12, 2021 | |
Principal | $ 396,000 | |
Interest | 9,060 | |
Debt Discount | (258,002) | |
Total | $ 147,058 | |
Power Up Lending Group LTD [Member] | ||
Interest rate | ||
Principal | ||
Interest | ||
Debt Discount | ||
Total | 33,707 | |
Power Up Lending Group LTD 2 [Member] | ||
Interest rate | ||
Principal | ||
Interest | ||
Debt Discount | ||
Total | 51,827 | |
First Fire Global Opportunities Fund [Member] | ||
Interest rate | ||
Principal | ||
Interest | ||
Debt Discount | ||
Total | $ 25,297 | 247,361 |
First Fire Global Opportunities Fund 2[Member] | ||
Interest rate | 6.50% | |
Maturity date | October 29, 2021 | |
Principal | $ 137,500 | |
Interest | 1,564 | |
Debt Discount | $ (113,767) | |
Auctus Fund, LLC [Member] | ||
Interest rate | 10.00% | |
Maturity date | May 7, 2020 | |
Principal | $ 150,000 | |
Interest | ||
Debt Discount | ||
Total | 129,016 | |
Auctus Fund, LLC 2[Member] | ||
Interest rate | 10.00% | |
Maturity date | August 13, 2021 | |
Principal | $ 95,000 | |
Interest | 3,764 | |
Debt Discount | (58,562) | |
Total | $ 40,202 | |
Labrys Fund, LP [Member] | ||
Interest rate | ||
Maturity date | ||
Principal | ||
Interest | ||
Debt Discount | ||
Total | $ 26,159 | 286,057 |
Labrys Fund, LP 2[Member] | ||
Interest rate | 12.00% | |
Maturity date | November 30, 2021 | |
Principal | $ 275,000 | |
Interest | 2,803 | |
Debt Discount | $ (251,644) | |
Ed Blasiak | ||
Interest rate | 6.50% | |
Maturity date | September 14, 2021 | |
Principal | $ 55,000 | |
Interest | 1,073 | |
Debt Discount | (38,726) | |
Total | $ 17,347 | |
Joshua Bauman | ||
Interest rate | 6.50% | |
Maturity date | September 14, 2021 | |
Principal | $ 137,500 | |
Interest | 2,562 | |
Debt Discount | (96,815) | |
Total | $ 43,247 | |
Geneva Roth Remark Holdings Inc | ||
Interest rate | 9.00% | |
Maturity date | August 29, 2021 | |
Principal | $ 88,000 | |
Interest | 1,001 | |
Debt Discount | (69,763) | |
Total | $ 19,238 | |
Geneva Roth Remark Holdings Inc 2 | ||
Interest rate | 9.00% | |
Maturity date | October 15, 2021 | |
Principal | $ 53,000 | |
Interest | 477 | |
Debt Discount | (46,724) | |
Total | $ 6,753 | |
Series N Convertible Notes [Member] | ||
Interest rate | 6.00% | |
Maturity date | On Demand | |
Principal | $ 3,229,000 | |
Interest | 425,333 | |
Debt Discount | ||
Total | 3,654,333 | $ 3,079,997 |
Actus Fund, LLC [Member] | ||
Total | $ 150,000 |
Mortgage loans - Loans Payable
Mortgage loans - Loans Payable (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Principal Outstanding | $ 3,963,781 | |
Short term portion | 115,704 | $ 114,290 |
Long term portion | 3,848,077 | 3,880,945 |
Loan Payable | $ 3,963,781 | $ 3,995,235 |
Pace Mortgage [Member] | ||
Interest rate | 4.20% | 4.20% |
Maturity date | Jul. 19, 2022 | |
Principal Outstanding | $ 3,958,315 | |
Accrued interest | 5,466 | |
Short term portion | 115,704 | |
Long term portion | 3,848,077 | |
Loan Payable | $ 3,963,781 | $ 3,995,235 |
Mortgage loans - Aggregate Amou
Mortgage loans - Aggregate Amount Outstanding (Details) | Dec. 31, 2020USD ($) |
Payables and Accruals [Abstract] | |
2021 | $ 115,704 |
2022 | 3,848,077 |
Total | $ 3,963,781 |
Derivative liability - Black Sc
Derivative liability - Black Scholes Valuations (Details) | 12 Months Ended |
Dec. 31, 2020$ / shares | |
Notes to Financial Statements | |
Calculated stock price, min | $ 0.0001 |
Calculated stock price, max | $ 0.0034 |
Risk free interest rate, min | 0.05% |
Risk free interest rate, max | 0.36% |
Expected life of convertible notes, minimum | 3 months |
Expected life of convertible notes, maximum | 5 years |
Expected volatility of underlying stock, min | 193.90% |
Expected volatility of underlying stock, max | 779.00% |
Expected dividend rate | 0.00% |
Derivative liability - Movement
Derivative liability - Movement (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Notes to Financial Statements | ||
Opening Balance | $ 8,694,272 | $ 4,618,080 |
Derivative liability mark-to-market on convertible debt extinguishment | 126,444,276 | |
Derivative liability on revised convertible notes and warrants arising from convertible debt extinguishment | 6,349,265 | |
Derivative liability cancelled on debt extinguishment | (144,893,444) | |
Derivative liability arising from convertible notes | 1,129,050 | 1,477,163 |
Fair value adjustment to derivative liability | 7,041,968 | 2,599,029 |
Closing Balance | $ 4,765,387 | $ 8,694,272 |
Stockholder's deficit - Black S
Stockholder's deficit - Black Scholes pricing model (Details) | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Expected dividend rate | $ 0 |
Minimum [Member] | |
Calculated stock price | 0.006% |
Risk free interest rate | 0.21% |
Expected life of warrants (years) | 3 years |
Expected volatility of underlying stock | 193.90% |
Maximum [Member] | |
Calculated stock price | 0.205% |
Risk free interest rate | 0.36% |
Expected life of warrants (years) | 5 years |
Expected volatility of underlying stock | 236.80% |
Stockholders' deficit - Warrant
Stockholders' deficit - Warrants (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Ending Balance, warrants | 615,561,379 | |
Ending Balance, warrants exercise price | $ 0.0113796 | |
Warrants | ||
Beginning balance, warrants | 2,566,101,248 | 97,499,908 |
Warrants Granted, shares | 233,333,332 | 27,700,652 |
Warrant Adjustment due to price protection, shares | 152,017,272,726 | 2,456,534,397 |
Warrants Cancelled, shares | (2,366,666) | (15,633,709) |
Granted in terms of debt extinguishment | 326,286,847 | |
Cancelled as part of debt extinguishment | (154,300,675,861) | |
Warrant Exercised, shares | (224,390,247) | |
Ending Balance, warrants | 615,561,379 | 2,566,101,248 |
Warrants granted, price | $ 0.0017357 | |
Warrant adjustment due to price protection, price | 0.0000324 | $ 0.00204 |
Warrants cancelled, price | 0.0300000 | 0.03 |
Warrants granted in terms of debt extinguishment, price | 0.000675 | |
Warrants cancelled as part of debt extinguishment, price | 0.0000324 | |
Warrants Exercised, price | 0.0004 | |
Minimum [Member] | ||
Beginning balance, warrants exercise price | 0.00204 | 0.003 |
Warrants granted, price | 0.10 | |
Ending Balance, warrants exercise price | 0.00204 | |
Maximum [Member] | ||
Beginning balance, warrants exercise price | $ 0.12 | 0.12 |
Warrants granted, price | 0.12 | |
Ending Balance, warrants exercise price | $ 0.12 |
Stockholders' deficit - warra_2
Stockholders' deficit - warrants Outstanding (Details) | Dec. 31, 2020$ / sharesshares |
No. of shares, Warrants outstanding | 615,561,379 |
Weighted average remaining years, Warrants outstanding | 4 years 3 months 11 days |
Weighted average exercise price, Warrants outstanding | $ / shares | $ 0.0113796 |
No. of shares, Warrants exercisable | 615,561,379 |
Weighted average exercise price, Warrants exercisable | $ / shares | $ 0.0113796 |
Excercise 0.00068 [Member] | |
No. of shares, Warrants outstanding | 326,286,847 |
Weighted average remaining years, Warrants outstanding | 4 years 6 months 10 days |
No. of shares, Warrants exercisable | 326,286,847 |
Excercise 0.03 [Member] | |
No. of shares, Warrants outstanding | 3,703,700 |
Weighted average remaining years, Warrants outstanding | 3 months 11 days |
No. of shares, Warrants exercisable | 3,703,700 |
Excercise 0.00150 [Member] | |
No. of shares, Warrants outstanding | 133,333,332 |
Weighted average remaining years, Warrants outstanding | 4 years 7 months 13 days |
No. of shares, Warrants exercisable | 133,333,332 |
Excercise 0.00205 [Member] | |
No. of shares, Warrants outstanding | 100,000,000 |
Weighted average remaining years, Warrants outstanding | 4 years 11 months 1 day |
No. of shares, Warrants exercisable | 100,000,000 |
Excercise 0.12 [Member] | |
No. of shares, Warrants outstanding | 52,237,500 |
Weighted average remaining years, Warrants outstanding | 10 months 21 days |
No. of shares, Warrants exercisable | 52,237,500 |
Segment information (Details)
Segment information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Revenues | $ 338,996 | $ 359,947 |
Operating expenditure | 502,340 | 4,559,682 |
Operating income (loss) | (163,344) | (4,199,735) |
Other (expense) income | ||
Other income | 1,183 | 6,600 |
Penalty on convertible notes | 569,628 | |
Gain on sale of assets | 36,470 | (1,019,812) |
Loss on debt conversion | 12,601,823 | |
Deposit forfeited | 1,665,078 | |
Warrants exercised | (95,868) | |
Interest income | 629 | 17,226 |
Interest expense | (631,425) | (1,079,038) |
Foreign exchange movements | (175,500) | (311,606) |
Taxation | ||
Assets | ||
Current assets | 935,152 | 255,442 |
Non-current assets | 2,887,314 | 2,955,637 |
Liabilities | ||
Current liabilities | 13,864,800 | 18,575,858 |
Rental Operations | ||
Revenues | 338,996 | 331,584 |
Operating expenditure | (134,387) | (17,200) |
Operating income (loss) | 204,609 | 314,384 |
Other (expense) income | ||
Other income | ||
Gain on extinguishment of debt | ||
Penalty on convertible notes | ||
Gain on sale of assets | ||
Loss on debt conversion | ||
Deposit forfeited | ||
Warrants exercised | ||
Interest income | ||
Interest expense | (241,815) | (396,100) |
Amortization of debt discount | ||
Change in fair value of derivative liability | ||
Foreign exchange movements | (114,768) | (38,992) |
Net income (loss) before taxation | (120,708) | |
Taxation | (114,768) | |
Net income (loss) | (120,708) | |
Purchase of fixed assets | 72,386 | |
Assets | ||
Current assets | 40,912 | 4,230 |
Non-current assets | 2,882,220 | 2,955,637 |
Liabilities | ||
Current liabilities | (1,584,724) | (1,280,442) |
Non-current liabilities | (4,583,765) | (4,655,765) |
Intercompany balances | 1,287,681 | 596,872 |
Net liability position | (1,957,676) | (2,379,468) |
In-Patient services | ||
Revenues | 28,363 | |
Operating expenditure | (367,953) | (4,542,482) |
Operating income (loss) | (367,953) | (4,514,119) |
Other (expense) income | ||
Other income | 1,183 | 6,600 |
Gain on extinguishment of debt | 12,601,823 | (1,019,812) |
Penalty on convertible notes | (569,628) | |
Gain on sale of assets | 36,470 | |
Loss on debt conversion | (585,351) | (203,981) |
Deposit forfeited | (1,665,078) | |
Warrants exercised | (95,868) | |
Interest income | 629 | 17,226 |
Interest expense | (389,610) | (682,938) |
Amortization of debt discount | (861,657) | (3,338,760) |
Change in fair value of derivative liability | (861,657) | (2,599,029) |
Foreign exchange movements | 3,199,760 | (272,614) |
Net income (loss) before taxation | (14,842,133) | |
Taxation | 3,199,760 | |
Net income (loss) | (14,842,133) | |
Purchase of fixed assets | 22,868 | |
Assets | ||
Current assets | 894,241 | 251,212 |
Non-current assets | 5,094 | |
Liabilities | ||
Current liabilities | (12,280,077) | (17,295,416) |
Non-current liabilities | ||
Intercompany balances | (1,287,681) | (596,872) |
Net liability position | (12,668,423) | (17,641,076) |
Total | ||
Revenues | 338,996 | 359,947 |
Operating expenditure | (502,340) | (4,559,682) |
Operating income (loss) | (163,344) | (4,199,735) |
Other (expense) income | ||
Other income | 1,183 | 6,600 |
Gain on extinguishment of debt | 12,601,823 | (1,019,812) |
Penalty on convertible notes | (569,628) | |
Gain on sale of assets | 36,470 | |
Loss on debt conversion | (585,351) | (203,981) |
Deposit forfeited | (1,665,078) | |
Warrants exercised | (95,868) | |
Interest income | 629 | 17,226 |
Interest expense | (631,425) | (1,079,038) |
Amortization of debt discount | (861,657) | (3,338,760) |
Change in fair value of derivative liability | (861,657) | (2,599,029) |
Foreign exchange movements | 3,084,992 | (311,606) |
Net income (loss) before taxation | (14,962,841) | |
Taxation | 3,084,992 | |
Net income (loss) | (14,962,841) | |
Purchase of fixed assets | 95,254 | |
Assets | ||
Current assets | 935,153 | 255,442 |
Non-current assets | 2,887,314 | 2,955,637 |
Liabilities | ||
Current liabilities | (13,864,801) | (18,575,858) |
Non-current liabilities | (4,583,765) | (4,655,765) |
Intercompany balances | ||
Net liability position | $ (14,626,099) | $ (20,020,544) |
Net (loss) income per common _3
Net (loss) income per common share (Details) | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Earnings Per Share [Abstract] | |
Stock options | |
Warrants to purchase shares of common stock | 2,566,101,248 |
Convertible notes | 1,046,179,457 |
Total | $ 3,612,280,705 |
Commitments and contingencies -
Commitments and contingencies - Mortgage Loans (Details) | Dec. 31, 2020USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2021 | $ 115,704 |
2022 | 3,848,077 |
Total | $ 3,963,781 |
Income taxes - Reconciliation o
Income taxes - Reconciliation of Income Taxes (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||
Tax credit at the federal and state statutory rate | $ 857,250 | $ (3,854,992) |
Foreign taxation | (56,212) | (62,163) |
Permanent differences | (1,091,032) | 1,569,469 |
Foreign tax rate differential | 1,061 | 1,173 |
Valuation allowance | 288,933 | 2,346,513 |
Net future tax asset |
Income taxes - Future Tax Asset
Income taxes - Future Tax Asset (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Income Tax Disclosure [Abstract] | ||
Net operating loss carry forward | $ 32,968,411 | $ 24,023,480 |
Prior year adjustment to opening balances | 150,639 | |
Foreign exchange differential | 48,579 | 68,923 |
Net taxable loss | 1,111,286 | 8,876,008 |
Valuation allowance | (34,278,915) | (32,968,411) |
Net future tax asset |