What changed in this filing

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Item 1. Financial Statements

2021-11-16 compared with 2021-08-10 · 275 added, 215 removed, 530 unchanged (48% of the section changed)

1 unchanged sentence

MITESCO, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

CONDENSED CONSOLIDATED BALANCE SHEET

September 30,

Current assets

1 unchanged sentence

Accounts Receivable

Due from related party

Prepaid expenses

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and 400,000 shares designated Series X:

Preferred stock, Series A, $ 0.01 par value, 0 and 4,800 shares issued and outstanding as of June 30, 2021 and December 31, 2020

Preferred stock, Series C, $ 0.01 par value, 1,940,644 and 0 shares issued and outstanding as of June 30, 2021 and December 31, 2020, respectively

Preferred stock, Series X, $ 0.01 par value, 24,227 shares issued and outstanding as of June 30, 2021;

26,227 shares issued and outstanding as of December 31, 2020

Preferred stock, Series A, $ 0.01 par value, 0 and 4,800 shares issued and outstanding as of September 30, 2021 and December 31, 2020

Preferred stock, Series C, $ 0.01 par value, 940,644 and 0 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively

Preferred stock, Series X, $ 0.01 par value, 24,227 shares issued and outstanding at September 30, 2021;

26,227 shares issued and outstanding at December 31, 2020

Common stock subscribed

Common stock, $ 0.01 par value, 500,000,000 shares authorized, 208,188,705 and 155,381,183 shares issued and outstanding as of June 30, 2021 and December 31, 2020, respectively

Common stock, $ 0.01 par value, 500,000,000 shares authorized, 212,853,706 and 155,381,183 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively

Additional paid-in capital

4 unchanged sentences

MITESCO, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

STATEMENT OF OPERATIONS

For the Three

September 30,

Cost of goods sold

8 unchanged sentences

Gain on settlement of accounts payable

Gain on settlement of accrued salary

Gain on settlement of notes payable

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MITESCO, INC.

CONDENSED CONSOLIDATED UNAUDITED STATEMENT OF STOCKHOLDER'S DEFICIT

STATEMENT OF STOCKHOLDERS EQUITY

Preferred Stock Series A

1 unchanged sentence

Preferred Stock Series X

Paid-in capital

Balance, March 31, 2020

Balance, June 30, 2020

Vesting of common stock issued to employees

Vesting of stock options issued to employees

Settlement of derivative liabilities

Common stock issued in warrant settlement agreement

Common stock issued for services

Common stock issued for conversion of notes payable and accrued interest

Preferred stock dividends

Loss for the period ended June 30, 2020

Loss for the period ended September 30, 2020

Balance, September 30, 2020

Balance, June 30, 2021

Balance, March 31, 2021

Vesting of common stock issued to employees

Vesting of stock options issued to employees

Shares issued to directors for exercise of options

Net shares cancelled in connection with settlement agreement

Shares issued for professional fees

Stock options exercised for cash

Exercise of options by cashless conversion

Cash paid for common stock subscribed

Shares of common stock issued for conversion of Preferred Stock Series C

Common stock subscribed for accounts payable and accrued liabilities

Preferred stock dividends

Loss for the period ended June 30, 2021

Balance, June 30, 2021

Loss for the period September 30, 2021

Balance, September 30, 2021

Preferred Stock Series A

Preferred Stock Series C

Preferred Stock Series X

Paid-in capital

Balance, December 31, 2019

7 unchanged sentences

Preferred stock dividends

Loss for the period ended June 30, 2020

Balance, June 30, 2020

Loss for the period ended September 30, 2020

Balance, September 30, 2020

Balance, December 31, 2020

10 unchanged sentences

Shares of common stock issued for conversion of Preferred Stock Series C

Common stock subscribed for accounts payable and accrued liabilities

Deemed dividend on conversion of Preferred Stock Series A to common stock

1 unchanged sentence

Preferred stock dividends

Loss for the period ended March 31, 2021

Balance, June 30, 2021

Loss for the period ended September 30, 2021

Balance, September 30, 2021

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.

MITESCO, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

STATEMENT OF CASH FLOWS

September 30,

CASH FLOWS FROM OPERATING ACTIVITIES

4 unchanged sentences

Gain on settlement of accounts payable

(Gain) on revaluation of Preferred Stock Series A

Loss on conversion of Pref Stock Series A to common stock

Gain on conversion of accrued salary

Gain (Loss) on revaluation of derivative liabilities

Derivative expense

Amortization of loan fees

Amortization of discount on notes payable

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Proceeds from notes payable, net of discount

Proceeds from sale of common stock

Principal payments on notes payable

Net cash provided by financing activities

Net increase (decrease) in cash and cash equivalents

Net increase in cash and cash equivalents

Cash and cash equivalents at beginning of period

11 unchanged sentences

Derivative discounts

Beneficial conversion feature

Conversion of Series A Preferred stock to common stock

2 unchanged sentences

Conversion of accrued payroll to common stock

Conversion of accounts payable to common stock subscribed

Shares issued for debt conversion

Shares issued for accrued salary conversion

Accrued interest converted to equity

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.

MITESCO, INC.

Notes to Condensed Consolidated Financial Statements

June 30, 2021, and 2020

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 1 – Description of Business

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Since 2020, our operations have focused on establishing medical clinics utilizing nurse practitioners under The Good Clinic name and development and acquisition of telemedicine technology.

In March of 2020, we formed a wholly owned subsidiary, The Good Clinic LLC, a Colorado limited liability company for our clinic business.

We opened our first The Good Clinic in Minneapolis, Minnesota in the first quarter of 2021 and anticipate opening seven more in the greater Minneapolis and Denver metropolitan areas before the end of 2021.

In March of 2020, we formed a wholly owned subsidiary, Mitesco N.A.

LLC, which holds The Good Clinic LLC, a Colorado limited liability company for our clinic business.

We also have a subsidiary in Dublin, Ireland, Acelerar Healthcare Holdings, LTD, with a view toward technology acquisitions, operations and potentially investments from the European marketplace.

We opened our first The Good Clinic in Minneapolis, Minnesota in the first quarter of 2021 and have three (3) operating at the time of this filing.

We have four (4) additional sites under contract with build-out underway and anticipate having seven (7) more in operation in the greater Minneapolis and Denver metropolitan areas before the end of 2022.

We are making plans for up to fifty (50) operating units before the end of 2023 from internal growth, and we may entertain acquisition of existing clinics as well.

N ote 2 - Financial Condition, Going Concern and Management Plans

As of June 30, 2021, the Company had cash of $ 1,686,000 , current liabilities of $ 1,326,000 , and has incurred a loss from operations and has generated minimal revenue.

As of September 30, 2021, the Company had cash of $ 442,000 , current liabilities of $ 3,166,000 , and has incurred a loss from operations and has generated minimal revenue.

The Company’s principal operation is the development and operation of primary care health and wellness clinics operated by nurse practitioners.

4 unchanged sentences

The Company’s continuance is dependent on raising capital and generating revenues sufficient to sustain operations.

During the six months ended June 30, 2021, the Company closed on a $ 3,000,000 Series C Preferred Stock and warrants offering and $ 1,668,000 restricted common stock offering.

During the nine months ended September 30, 2021, the Company closed on a $ 3,000,000 Series C Preferred Stock and warrants offering and $ 1,668,000 restricted common stock offering.

To continue its expansion plans, the Company believes that additional capital will need to be raised and has entered discussions to do so with certain companies.

1 unchanged sentence

The accompanying condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts classified as liabilities that might be necessary should the Company be forced to take any such actions.

PPP Loan and Smith Matter

During March 2020, in response to the COVID-19 crisis, the federal government announced plans to offer loans to small businesses in various forms, including the Payroll Protection Program, or "PPP", established as part of the Corona Virus Aid, Relief and Economic Security Act (“CARES Act”) and administered by the U.S.

Small Business Administration.

On April 18, 2020, the Company’s former President and COO completed and applied on behalf of the Company to Bank of America, NA (“Bank of America”) for a PPP loan, which was subsequently approved.

On April 25, 2020, the Company entered an unsecured Promissory Note (the “Note”) with Bank of America for a loan in the original principal amount of approximately $ 460,000 , and the Company received the full amount of the loan proceeds on May 4, 2020.

On July 21, 2020, Bank of America notified the Company in writing that it should not have received $ 440,000 of the loan proceeds disbursed under the Note.

The Company investigated the terms of the application and discovered its former President had erroneously represented it was refinancing an Economic Injury Disaster Loan when no such loan had been received.

Bank of America requested that the Company remit the funds received back to Bank of America.

The Company is currently working with Bank of America on a repayment plan.

If we are not successful in negotiating repayment terms, it could have a material adverse effect on our financial condition.

As of the date of this filing the Company has not restructured the loan and Bank of America has not taken any adversarial actions with regard to the loan.

During management's review of the loan application after the loan had been disbursed to the Company, it was determined that the information provided by its former President and COO in the application was not representative of the Company’s situation.

After consulting with legal counsel and conferring with the Board of Directors, the Board of Directors, in executive session, voted to remove the Company’s former President and Chief Operating Officer (“COO”) from its Board of Directors, and all operating roles due to the inaccuracy of the loan application.

After that decision, the former President & COO submitted a resignation from all positions with the Company, which was accepted by the Board and management.

In August 2020, the former President and COO filed a complaint alleging discrimination under certain provisions of the anti-discrimination laws of that state.

As of the date of this filing the Company has been advised by the convening judicial organization that it has dismissed this matter.

The former President requested a “Right-to-Sue” letter, which she received, giving her a right to sue in District Court for 90 days from the date of the dismissed action.

On June 23, 2021, the Company and the former President and COO reached a confidential settlement and release agreement releasing both parties of any future claims.

The current balance is $460,406 and the Company is currently in discussions for a) a partial forgiveness and b) the conversion of any remaining balance into a term note.

COVID -19 Impact

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Cash - The Company considers all highly liquid investments with maturities of three months or less to be cash equivalents.

The Company had cash and cash equivalents of approximately $ 1,686,000 as of June 30, 2021, and $ 65,000 as of December 31, 2020.

The Company had cash and cash equivalents of approximately $ 442,000 as of September 30, 2021, and $ 65,000 as of December 31, 2020.

Property, Plant, and Equipment - Property and equipment is recorded at the lower of cost or estimated net recoverable amount and is depreciated using the straight-line method over its estimated useful life.

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During the three months ended March 31, 2021, the costs previously recorded as construction in progress were recorded to fixed assets and are being depreciated over their useful lives or lease term as appropriate.

During the three months ended June 30, 2021, no additional fixed assets were acquired.

During the three months ended June 30, 2021, the Company entered into three additional lease, two leases are for two new clinics and one lease was for the new corporate headquarters.

During the three months ended September 30, 2021, no additional fixed assets were acquired.

During the three months ended June 30, 2021, the Company entered into three additional leases, two leases are for two new clinics and one lease was for the new corporate headquarters.

During the three months ended September 30, 2021 the Company entered into three new clinic leases.

With the signing of the three additional leases late in the second quarter we anticipate additional expenditures for fixed assets and leasehold improvements.

During the fourth quarter of 2021 we expect to have expenditures of approximately $ 3 million related to construction and equipment related to these new clinic locations.

Revenue Recognition – On January 1, 2018, we adopted Accounting Standards Update No.

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The model uses market-sourced inputs such as interest rates and stock price volatilities.

As of June 30, 2021, the Company had retired all derivative instruments.

As of September 30, 2021, the Company had retired all derivative instruments .

Common Stock Purchase Warrants- The Company accounts for common stock purchase warrants in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 815, Accounting for Derivative Instruments and Hedging Activities.

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Because there is no ready market or observable transactions, management classifies the derivative liabilities as Level 3.

Recently Issued Accounting Standards

New Accounting Standards

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) or other standard setting bodies that the Company adopts as of the specified effective date.

Unless otherwise discussed, the Company does not believe that the impact of recently issued standards that are not yet effective will have a material impact on its financial position or results of operations upon adoption.

Recent Accounting Standards Adopted in the Year

In June 2018, the FASB issued ASU 2018-07 “Improvements to Non-employee Share-Based Payment Accounting”, which simplifies the accounting for share-based payments granted to non-employees for goods and services.

1 unchanged sentence

The amendments are effective for fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020.

The Company does not anticipate that the adoption of this standard will have a material impact on the Company’s consolidated financial statements.

In December 2019, the FASB issued ASU No.

5 unchanged sentences

2019-12, “Income Taxes (Topic 740) however giving the Company’s historical losses and full valuation allowance it did not have an impact on its condensed consolidated financial statements and related disclosures.

Recent Accounting Standards Not Yet Adopted

In August 2020, the FASB issued ASU 2020-06, “Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40)”.

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Diluted loss per common share is computed similarly to basic loss per common share except that it reflects the potential dilution that could occur if dilutive securities or other obligations to issue common stock were exercised or converted into common stock.

The following table sets forth the computation of loss per share for the three and six months ended June 30, 2021, and 2020, respectively:

Three Months Ended June 30,

Net loss applicable to common shareholders

Weighted average common shares outstanding

Net loss per share data:

Basic and diluted

Six Months Ended June 30,

The following table sets forth the computation of loss per share for the three and nine months ended September 30, 2021, and 2020, respectively:

For the three months ended September 30,

For the nine months ended September 30,

Net loss applicable to common shareholders

Weighted average common shares outstanding

Net loss per share data:

Weighted Average shares outstanding

Net loss per share

Basic and diluted

The Company excluded all common equivalent shares outstanding for warrants, options, and convertible instruments to purchase common stock from the calculation of diluted net loss per share because all such securities are antidilutive for the periods presented.

As of June 30, 2021, and 2020, the following shares were issuable and excluded from the calculation of diluted loss:

As of September 30, 2021, and 2020, the following shares were issuable and excluded from the calculation of diluted loss:

For the nine months ended September 30,

Common stock options

Common stock purchase warrants

Convertible Preferred Stock Series C

Accrued interest on Preferred Stock

Potentially dilutive securities

Note 5 – Related Party Transactions

For the three months ended June 30, 2021:

During the three months ended June 30, 2021, the Company accrued dividends on its Series X Preferred Stock in the total amount of $ 15,144 .

For the three months ended September 30, 2021:

On July 21, 2021, the Company issued a total of 3,000,000 stock option awards to the Company’s executive officers:

1,500,000 to its Chief Executive Officer, 750,000 to its Chief Financial Officer and 750,000 to its Chief Legal Officer.

The options will expire on the ten- year anniversary of the grant date and will vest following the Company’s achievement of a total of $30 million of revenues over four consecutive quarters , as recorded under generally accepted accounting principles of the United States of America.

The options have a strike price of $ 0.25 the amount was based on the price of the lowest investment amount offered to outside investors in 2021 and is higher than the closing price on the date they were granted.

On August 26, 2021, the Company issued 312,800 restricted shares of the Company’s common stock priced at $ 0.25 , vesting immediately, in lieu of $ 78,200 of cash compensation owed to the Company’s Chief Executive Officer for services rendered to the Company prior to 2021.

During the three months ended September 30, 2021, the Company accrued dividends on its Series X Preferred Stock in the total amount of $ 15,141 .

Of this amount, a total of $ 2,000 was payable to officers and directors, $ 7,816 was payable to a related party shareholder, and $ 5,325 was payable to non-related parties.

For the six months ended June 30, 2021:

During the six months ended June 30, 2021, the Company accrued dividends on its Series X Preferred Stock in the total amount of $ 31,536 .

For the nine months ended September 30, 2021:

On July 21, 2021, the Company issued a total of 3,000,000 stock option awards to the Company’s executive officers:

1,500,000 to its Chief Executive Officer, 750,000 to its Chief Financial Officer and 750,000 to its Chief Legal Officer.

The options will expire on the ten-year anniversary of the grant date and will vest following the Company’s achievement of a total of $30 million of revenues over four consecutive quarters, as recorded under generally accepted accounting principles of the United States of America.

The options have a strike price of $0.25 the amount was based on the price of the lowest investment amount offered to outside investors in 2021 and is higher than the closing price on the date they were granted.

On August 26, 2021, the Company issued 312,800 restricted shares of the Company’s common stock priced at $0.25, vesting immediately, in lieu of $78,200 of cash compensation owed to the Company’s Chief Executive Officer for services rendered to the Company prior to 2021.

During the nine months ended September 30, 2021, the Company accrued dividends on its Series X Preferred Stock in the total amount of $ 46,677 .

Of this amount, a total of $ 6,000 was payable to officers and directors, $ 23,444 was payable to a related party shareholder, and $ 17,233 was payable to non-related parties.

For the three months ended June 30, 2020:

During the three months ended June 30, 2020, the Company charged the amount of $ 19,374 to operations in connection with the vesting of restricted common stock as follows:

For the three months ended September 30, 2020:

On August 1, 2020, the Company agreed to issue 1,000,000 ten-year options to a non-management director.

These options have a fair value of $56,037, an exercise price of $0.05 per share, and vest over a three-year period.

The Company valued these options using the Black-Scholes valuation model.

During the nine months ended September 30, 2020, the amount of $11,595 was charged to operations in connection these options.

For the nine months ended September 30, 2020:

On February 27, 2020, the Company agreed to issue 1,000,000 ten-year options to its two non-management directors (a total of 2,000,000 options).

These options have a fair value at issuance of $ 39,162 per director (a total of $ 78,324 ), an exercise price of $ 0.05 per share, and vest over a three-year period.

The Company valued these options using the Black-Scholes valuation model.

During the three- months ended September 30, 2020, the amount of $ 3,264 was charged to operations in connection with each 1,000,000-option grant (a total of $ 6,528 for all 2,000,000 options).

On March 2, 2020, the Company agreed to issue 1,500,000 ten-year options to each of its Chief Executive Officer, its President, and a consultant (a total of 4,500,000 options).

These options have a fair value at issuance of $ 58,743 per individual (a total of $ 176,229 ), an exercise price of $ 0.05 per share, and vest over a three-year period.

The Company valued these options using the Black-Scholes valuation model.

Julie Smith, the Company’s President, Chief Operating Officer, and a Board member resigned effective September 30, 2020;

the 1,500,000 options that the Company agreed to issue to Ms.

Smith were cancelled, and no vesting of these options was recorded during the three months ended September 30, 2020.

During the three months ended September 30, 2020, the amount of $ 4,896 was charged to operations in connection with each of the remaining 1,500,000 option grants (a total of $ 9,792 for all 3,000,000 remaining options).

On June 1, 2020, the Company agreed to issue 1,000,000 ten-year options to a non-management director.

These options have a fair value of $ 28,460 , an exercise price of $ 0.03 per share, and vest over a three-year period.

The Company valued these options using the Black-Scholes valuation model.

During the nine months ended September 30, 2020, the amount of $ 9,487 was charged to operations in connection these options.

On August 1, 2020, the Company agreed to issue 1,000,000 ten-year options to a non-management director.

These options have a fair value of $ 56,037 , an exercise price of $ 0.05 per share, and vest over a three-year period.

The Company valued these options using the Black-Scholes valuation model.

During the nine months ended September 30, 2020, the amount of $ 11,595 was charged to operations in connection these options.

During the nine months ended September 30, 2020, the Company charged the amount of $ 69,342 to operations in connection with the vesting of restricted common stock as follows:

$ 27,196 for shares issued to management;

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and $ 15,635 related to shares issued to an employee.

Julie Smith, the Company’s former President, Chief Operating Officer, and a Board member, resigned effective June 30, 2020.

Julie Smith, our former President, Chief Operating Officer, and a Board member, resigned effective June 30, 2020;

at the time of her resignation, a total of 1,000,000 shares of the Company’s common stock issued to Ms.

1 unchanged sentence

an additional 250,000 shares of common stock issued to Ms.

Smith for compensation as an officer were vested and remain outstanding;

Smith for compensation as an officer were vested, and also remain outstanding;

750,000 shares of common stock to be issued to Ms.

Smith for compensation as an officer had not vested, and these shares were cancelled.

On June 30, 2020, the Company accrued dividends on its Series X Preferred stock in the total amount of $ 32,784 .

Of this amount, a total of $ 6,500 was payable to officers and directors, $ 15,629 was payable to a related party shareholder, and $ 10,655 was payable to non-related parties.

For the six months ended June 30, 2020:

On February 27, 2020, the Company agreed to issue 1,000,000 ten-year options to its two non-management directors (a total of 2,000,000 options).

These options have a fair value at issuance of $ 39,162 per director (a total of $ 78,324 ), an exercise price of $ 0.05 per share, and vest over a three-year period.

The Company valued these options using the Black-Scholes valuation model.

During the three- months ended June 30, 2020, the amount of $ 3,264 was charged to operations in connection with each 1,000,000-option grant (a total of $ 6,528 for all 2,000,000 options).

On March 2, 2020, the Company agreed to issue 1,500,000 ten-year options to each of its Chief Executive Officer, its President, and a consultant (a total of 4,500,000 options).

These options have a fair value at issuance of $ 58,743 per individual (a total of $ 176,229 ), an exercise price of $ 0.05 per share, and vest over a three-year period.

The Company valued these options using the Black-Scholes valuation model.

Julie Smith, the Company’s President, Chief Operating Officer, and a Board member resigned effective June 30, 2020;

the 1,500,000 options that the Company agreed to issue to Ms.

Smith were cancelled, and no vesting of these options was recorded during the three months ended June 30, 2020.

During the three months ended June 30, 2020, the amount of $ 4,896 was charged to operations in connection with each of the remaining 1,500,000 option grants (a total of $ 9,792 for all 3,000,000 remaining options).

On June 30, 2020, the Company accrued dividends on its Series X Preferred stock in the total amount of $32,784.

During the nine months ended September 30, 2020, the Company accrued dividends on its Series X Preferred stock in the total amount of $ 49,176 .

Of this amount, a total of $ 9,750 was payable to officers and directors, ,$ 23,443 was payable to a related party shareholder, and $ 15,983 was payable to non-related parties.

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Fixed rent payments under the initial term are approximately $ 244,000 .

As of June 30, 2021, the Company had total operating lease liabilities of approximately $ 1.4 million and right-of-use assets of approximately $ 1.3 million, which were included in the condensed consolidated balance sheet.

On August 31, 2021, the Company entered into an agreement to open a clinic in St.

Paul, Minnesota, which is expected to begin operation in the fourth quarter of 2021.

The initial lease term is for 114 months.

Fixed rent payments under the initial term are approximately $ 663,000 .

On September 9, 2021, the Company entered into an agreement to open a clinic in Minneapolis, Minnesota, which is expected to begin operation in the fourth quarter of 2021.

The initial lease term is for 90 months.

Fixed rent payments under the initial term are approximately $ 489,000 .

On September 28, 2021, the Company entered into an agreement to open a clinic in Denver, Colorado, which is expected to begin operation in the first quarter of 2022.

The initial lease term is for 96 months.

Fixed rent payments under the initial term are approximately $ 640,000 .

As of September 30, 2021, the Company had total operating lease liabilities of approximately $ 3.2 million and right-of-use assets of approximately $ 3.1 million, which were included in the condensed consolidated balance sheet.

Right to use assets – operating leases are summarized below:

September 30,

Administrative office

1 unchanged sentence

Operating lease liabilities are summarized below:

September 30,

Administrative office

3 unchanged sentences

The Company’s lease expense was entirely comprised of operating leases.

Lease expense for the three months ended June 30, 2021, was 2020 was $ 38,500 and $ 0 .

For the six months ended June 30, 2021, and 2020 amounted to $ 59,200 and $ 0 , respectively.

The Company’s ROU asset amortization for the three months ended June 30, 2021, and 2020 was $ 18,500 and $ 0 , respectively.

The Company’s ROU asset amortization for the six months ended June 30, 2021, and 2020 was $ 24,700 and $ 0 , respectively the difference between the lease expense and the associated ROU asset amortization consists of interest at a rate of 12 % per annum.

Lease expense for the three months ended September 30, 2021, was $ 153,300 and for 2020 was $ 0 .

For the nine months ended September 30, 2021, and 2020 amounted to $ 212,500 and $ 0 , respectively.

The Company’s ROU asset amortization for the three months ended September 30, 2021, and 2020 was $ 18,500 and $ 0 , respectively.

The Company’s ROU asset amortization for the nine months ended September 30, 2021, and 2020 was $ 71,349 and $ 0 , respectively the difference between the lease expense and the associated ROU asset amortization consists of interest at a rate of 12 % per annum.

Maturity analysis under these lease agreements are as follows:

For the twelve months ended June 30, 2022

For the twelve months ended June 30, 2023

For the twelve months ended June 30, 2024

For the twelve months ended June 30, 2025

For the twelve months ended June 30, 2026

For the twelve months ended September 30, 2022

For the twelve months ended September 30, 2023

For the twelve months ended September 30, 2024

For the twelve months ended September 30, 2025

For the twelve months ended September 30, 2026

Present value discount

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On January 6, 2021, the Company issued 3,505,964 shares of common stock at a price of $ 0.01224 per share pursuant to the conversion of $ 39,000 of principal and $ 3,913 of accrued interest in Eagle Equities Note 4.

These obligations have been fully satisfied as of the date of this filing and the Company has no further requirements related to these matters.

This obligation has been fully satisfied as of the date of this filing and the Company has no further requirements related to this matter.

Eagle Equities Note 5

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On January 14, 2021, the Company issued 4,319,378 shares of common stock at a price of $ 0.01266 per share pursuant to the conversion of $ 50,000 of principal and $ 4,683 of accrued interest in Eagle Equities Note 5.

These obligations have been fully satisfied as of the date of this filing and the Company has no further requirements related to these matters.

This obligation has been fully satisfied as of the date of this filing and the Company has no further requirements related to this matter.

Eagle Equities Note 6

1 unchanged sentence

On January 28, 2021, the Company issued 7,285,062 shares of common stock at a price of $ 0.01575 per share pursuant to the conversion of $ 107,200 of principal and $ 7,540 of accrued interest in Eagle Equities Note 6.

These obligations have been fully satisfied as of the date of this filing and the Company has no further requirements related to these matters.

This obligation has been fully satisfied as of the date of this filing and the Company has no further requirements related to this matter.

Eagle Equities Note 7

On February 5, 2021, the Company entered into a settlement agreement with the holders of the Eagle Equities Note 7 whereby the Company issued 1,184,148 shares of common stock at a price of $ 0.24984 per share in satisfaction of $ 200,200 of principal and all accrued interest and prepayment penalties due under this note.

These obligations have been fully satisfied as of the date of this filing and the Company has no further requirements related to these matters.

This obligation has been fully satisfied as of the date of this filing and the Company has no further requirements related to this matter.

Eagle Equities Note 8

On February 5, 2021, the Company entered into a settlement agreement with the holders of the Eagle Equities Note 8 whereby the Company issued 639,593 shares of common stock at a price of $ 0.23851 per share in satisfaction of $ 114,400 of principal and all accrued interest and prepayment penalties due under this note.

These obligations have been fully satisfied as of the date of this filing and the Company has no further requirements related to these matters.

This obligation has been fully satisfied as of the date of this filing and the Company has no further requirements related to this matter.

Eagle Equities Note 9

On February 5, 2021, the Company entered into a settlement agreement with the holders of the Eagle Equities Note 9 whereby the Company issued 605,177 shares of common stock at a price of $ 0.24984 per share in satisfaction of $ 114,400 of principal and all accrued interest and prepayment penalties due under this note.

These obligations have been fully satisfied as of the date of this filing and the Company has no further requirements related to these matters.

This obligation has been fully satisfied as of the date of this filing and the Company has no further requirements related to this matter.

Eagle Equities Note 10

On February 5, 2021, the Company entered into a settlement agreement with the holders of the Eagle Equities Note 10 whereby the Company issued 1,095,131 shares of common stock at a price of $ 0.23748 per share in satisfaction of $ 200,200 of principal and all accrued interest and prepayment penalties due under this note.

These obligations have been fully satisfied as of the date of this filing and the Company has no further requirements related to these matters.

On May 4, 2020, the Company received loan proceeds from Bank of America in the amount of $ 460,406 under the Paycheck Protection Program (the “PPP Loan”).

On July 21, 2020, Bank of America notified the Company in writing that it should not have received $440,000 of the loan proceeds disbursed under the Note.

Bank of America requested that the Company return the funds it received back to Bank of America.

The Company is currently negotiating a repayment plan with Bank of America though no modification has been agreed to as of the date of this filing.

If we are not successful in negotiating repayment terms, it could have a material adverse effect on our financial condition.

Details of additional activity for the quarter ended June 30, 2021, are presented in Notes Payable Table 1, below.

This obligation has been fully satisfied as of the date of this filing and the Company has no further requirements related to this matter.

Small Business Administration.

The current balance is $ 460,406 and the Company is currently in discussions for a) a partial forgiveness and b) the conversion of any remaining balance into a term note.

These amounts are reflected in the table below:

Notes Payable Table 1:

September 30,

Total notes payable

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The derivative components of these notes are valued at issuance, at conversion, at restructure, and at each period end.

Derivative liability activity for the six months ended June 30, 2021, are summarized in the table below:

Derivative liability activity for the nine months ended September 30, 2021, are summarized in the table below:

December 31, 2020

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Gain on revaluation

June 30, 2021

September 30, 2021

Note 9 – Stockholders ’ Equity (Deficit)

The Company has authorized 500,000,000 shares of common stock, par value $ 0.01 ;

208,188,705 shares were issued and outstanding on June 30, 2021.

Common Stock Transactions During the Six Months Ended June 30, 2021

212,853,706 shares were issued and outstanding on September 30, 2021.

Common Stock Transactions During the Nine Months Ended September 30, 2021

On January 4, 2021, the Company issued 4,123,750 shares of common stock at a price of $ 0.012 per share pursuant to the conversion of $ 45,000 of principal and $ 4,485 of accrued interest in Eagle Equities Note 4.

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Also, in connection with the settlement agreement, the Company issued 637,953 shares to the ex-officer at the market price of $.20 per share.

Also, during the six months ended June 30, 2021, the Company charged the amount of $ 7,897 to operations in connection with the vesting of stock granted to its officers and board members;

Between August 11, 2021 and September 2, 2021 the Company issued 4,000,001 shares of the Company common stock in connection with the conversion of Series C preferred stock issued in the first quarter.

Also, during the nine months ended September 30, 2021, the Company charged the amount of $ 7,897 to operations in connection with the vesting of stock granted to its officers and board members;

the Company also charged the amount of $ 201,292 to operations in connection with the vesting of options granted to its officers and board members

Common Stock Transactions During the Six Months Ended June 30, 2020

During the six months ended June 30, 2020, the Company issued 2,901,440 shares of common stock for the cashless exercise of warrants.

Common Stock Transactions During the Nine Months Ended September 30, 2020

During the nine months ended September 30, 2020, the Company issued 2,901,440 shares of common stock for the cashless exercise of warrants.

These warrants were issued pursuant to a settlement agreement with a note holder regarding the effective price of warrants issued with regard to a variable conversion price feature which resulted in the issuance of 1,011,967 more shares than would have been issued prior to the settlement agreement.

The Company recorded a loss in the amount of $ 24,894 on this transaction based upon the additional shares issued at the market price of the Company’s common stock.

Also, during the six months ended June 30, 2020, the holder of the Eagle Equities Note 1 converted the following amounts of principal and accrued interest to common stock:

Also, during the nine months ended September 30, 2020, the holder of the Eagle Equities Note 1 converted the following amounts of principal and accrued interest to common stock:

On June 5, 2020, principal of $ 25,000 and accrued interest of $ 1,608 were converted at a price of $ 0.0132 per share into 2,015,783 shares of common stock;

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There were no gains or losses recorded, as these conversions were made pursuant to the terms of the agreement.

Also, during the six months ending June 30, 2020, the Company issued 200,000 restricted shares of the Company’s common stock at valued $ 7,680 in exchange for services conducted on behalf of the Company.

Also, during the nine months ending September 30, 2020, the Company issued 200,000 restricted shares of the Company’s common stock at valued $ 7,680 in exchange for services conducted on behalf of the Company.

The value of these shares was based on the closing market price on the respective date of grant.

Also, during the six months ended June 30, 2020, the Company charged the amount of $ 53,050 to operations in connection with the vesting of stock granted to its officers and board members;

Also, during the nine months ended September 30, 2020, the Company charged the amount of $ 53,050 to operations in connection with the vesting of stock granted to its officers and board members;

the Company also charged the amount of $ 27,580 to operations in connection with the vesting of options granted to officers and board members.

Also, during the six months ended June 30, 2020, the Company entered into agreements to issue 500,000 options to each of four consultants (a total of 2,000,000 options).

Also, during the nine months ended September 30, 2020, the Company entered into agreements to issue 500,000 options to each of four consultants (a total of 2,000,000 options).

The options have a fair value of $ 20,930 per consultant (a total of $ 83,720 ).

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The Company valued these options using the Black-Scholes valuation model.

Also, during the six months ended June 30, 2020, the Company entered into agreements with two note holders regarding the exercise price of warrants held by the note holders.

Also, during the nine months ended September 30, 2020, the Company entered into agreements with two note holders regarding the exercise price of warrants held by the note holders.

These agreements resulted in the following:

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the Company recorded a gain in the amount of $ 259,947 on this transaction, which is included in gain on derivative liabilities.

Also, during the nine months ended September 30, 2020, the Company issued 386,985 shares of common stock at a price of $ 0.034 per share to an ex-employee for accrued compensation.

A gain in the amount of $ 6,988 was recognized on this transaction.

Preferred Stock

Series A Preferred Stock Transactions During the Six Months Ended June 30, 2020

Series A Preferred Stock

Series A Preferred Stock Transactions During the Nine Months Ended September 30, 2021

During the nine months ended September 30, 2021, the Company accrued dividends in the amount of $ 1,000 on the Series A Preferred Stock.

On March 11, 2021, the Company issued 600,000 shares of common stock to the four officers of The Good Clinic in exchange for the previously issued Series A Preferred Stock and accrued dividends.

The Series A preferred stock was canceled and there are no Series A Preferred shares outstanding at this time.

Series A Preferred Stock Transactions During the Nine Months Ended September 30, 2020

On March 2, 2020, the Company issued 4,800 shares of its Series A Preferred Stock to four individuals with certain skills and know-how to assist the Company in the development of its newly formed subsidiary My Care, LLC.

The Company had valued these shares at $ 71,558 or approximately $ 14.91 per share based upon an analysis performed by an independent valuation consultant.

During the six months ended June 30, 2020, the Company accrued dividends in the amount of $ 3,967 on the Series A Preferred Stock.

On June 30, 2020, dividend payable on the Series A Preferred Stock was $ 3,967 .

On June 30, 2020, if management determined to pay these dividends in shares of the Company’s common stock, this would result in the issuance of 98,780 shares of common stock based upon the average price of $0.0402 per share for the five-day period ended June 30, 2020 .

Series A Preferred Stock Transactions During the Six Months Ended June 30, 2021

During the six months ended June 30, 2021, the Company accrued dividends in the amount of $ 1,000 on the Series A Preferred Stock.

On March 11, 2021, the Company issued 600,000 shares of common stock to the four officers of The Good Clinic in exchange for the previously issued Series A Preferred Stock and accrued dividends.

The Series A preferred stock was canceled.

During the nine months ended September 30, 2020, the Company accrued dividends in the amount of $ 3,967 on the Series A Preferred Stock.

On September 30, 2020, dividend payable on the Series A Preferred Stock was $ 3,967 .

On September 30, 2020, if management determined to pay these dividends in shares of the Company’s common stock, this would result in the issuance of 98,780 shares of common stock based upon the average price of $0.0402 per share for the five-day period ended September 30, 2020 .

Series C Preferred Stock

Series C Preferred Stock Transactions During the Six Months Ended June 30, 2021

Series C Preferred Stock Transactions During the Nine Months Ended September 30, 2021

On March 25, 2021, the Company entered into Securities Purchase Agreements (the “SPAs”) with four institutional investors (the “Investors” and each an “Investor”) pursuant to which the Company sold to the Investors in a private placement an aggregate of 3,000,000 units (the “Units” and each a “Unit”) with a purchase price of $ 1.00 per Unit, with each Unit consisting of (a) one share of a newly formed Series C Convertible Preferred Stock, par value $0.01 per share (the “Series C Preferred Stock”), (b) one warrant (the “Series A Warrants”) to purchase 2.1 shares of the Company’s common stock, par value $0.01 per share (the “Common Stock”) at a purchase price of $0.50 per whole share of Common Stock, and (c) one warrant (the “Series B Warrants” and together with the Series A Warrants, the “Warrants”) to purchase 2.1 shares of Common Stock at a purchase price of $0.75 per whole share .

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On May 4 through May 26, 2021, 1,059,356 shares of Series C Preferred Stock were converted at a price of $ 0.25 per share to 4,237,424 shares of common stock.

During the six months ended June 30, 2021, the Company accrued dividends on the Series C Preferred Stock in the amount of $ 42,078 .

Series C Preferred Stock Transactions During the Six Months Ended June 30, 2020

During the nine months ended September 30, 2021, the Company accrued dividends on the Series C Preferred Stock in the amount of $ 42,078 .

On August 11, 2021 through September 2, 2021, 1,000,000 shares of Series C Preferred Stock were converted at a price of $ 0.25 per share to 4,000,001 shares of common stock.

During the nine months ended September 30, 2021, the Company accrued dividends on the Series C Preferred Stock in the amount of $ 67,370 .

Series C Preferred Stock Transactions During the Nine Months ended September 30, 2020

Series X Preferred Stock

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Each one share of the Series X Preferred Stock is entitled to 20,000 votes on all matters submitted to a vote of our shareholders.

For the six months ended June 30, 2021:

During the six months ended June 30, 2021, the Company received for retirement 2,000 shares of Series X Preferred Stock pursuant to a settlement agreement.

Also, during the six months ended June 30, 2021, the Company accrued dividends on its Series X Preferred Stock in the total amount of $ 31,536 .

Series X Preferred Stock Transactions During the Nine Months Ended September 30, 2021

During the nine months ended September 30, 2021, the Company accrued dividends on its Series X Preferred Stock in the total amount of $ 46,677 .

Of this amount, a total of $ 6,000 was payable to officers and directors, $ 23,444 was payable to a related party shareholder, and $ 17,233 was payable to non-related parties.

Series X Preferred Stock Transactions During the Nine Months Ended September 30, 2020

Stock Options

The following table summarizes the options outstanding on June 30, 2021, and the related prices for the options to purchase shares of the Company’s common stock:

The following table summarizes the options outstanding on September 30, 2021, and the related prices for the options to purchase shares of the Company’s common stock:

$ 0.03 -$ 0.39

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Outstanding on December 31, 2020

Outstanding on June 30, 2021

Aggregate intrinsic value of options outstanding and exercisable on June 30, 2021, and 2020 was $ 929,550 and $ 0 , respectively.

Aggregate intrinsic value represents the difference between the Company’s closing stock price on the last trading day of the fiscal period, which was $ 0.28 and $ 0.04 as of June 30, 2021, and 2020, respectively, and the exercise price multiplied by the number of options outstanding and exercisable.

On June 30, 2021, the total stock-based compensation cost related to unvested awards not yet recognized was $ 1,205,961 .

Outstanding on September 30, 2021

Aggregate intrinsic value of options outstanding and exercisable on September 30, 2021, and 2020 was $ 789,500 and $ 0 , respectively.

Aggregate intrinsic value represents the difference between the Company’s closing stock price on the last trading day of the fiscal period, which was $ 0.28 and $ 0.04 as of September 30, 2021, and 2020, respectively, and the exercise price multiplied by the number of options outstanding and exercisable.

On September 30, 2021, the total stock-based compensation cost related to unvested awards not yet recognized was $ 1,205,961 .

The Black-Scholes option pricing model is used to estimate the fair value of stock options granted under the Company’s share-based compensation plans.

The weighted average assumptions used in calculating the fair values of stock options as of June 30, 2021, was as follows:

The weighted average assumptions used in calculating the fair values of stock options as of September 30, 2021, was as follows:

September 30,

161.0 % to 183.5

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5.00 to 10.00

The following table summarizes the warrants outstanding on June 30, 2021, and the related prices for the warrants to purchase shares of the Company’s common stock:

The following table summarizes the warrants outstanding on September 30, 2021, and the related prices for the warrants to purchase shares of the Company’s common stock:

Weighted- Average

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Outstanding on December 31, 2020

Outstanding on June 30, 2021

Outstanding on September 30, 2021

Note 10 – Fair Value of Financial Instruments

The following summarizes the Company’s derivative financial liabilities that are recorded at fair value on a recurring basis on June 30, 2021, and December 31, 2020.

June 30, 2021

Derivative liabilities

The following summarizes the Company’s derivative financial liabilities that are recorded at fair value on a recurring basis on September 30, 2021, and December 31, 2020.

Fair value measured at September 30, 2021

Quoted prices in active

Significant other

observable inputs

unobservable inputs

Fair value at

September 30, 2021

Derivative liability

Fair value measured at December 31, 2020

Quoted prices in active

Significant other

observable inputs

unobservable inputs

Fair value at

December 31, 2020

Derivative liabilities

Derivative liability

Note 11 – Commitments and Contingencies

There is no pending or anticipated legal actions at this time except as noted below in “Other”.

On May 4, 2020, we received a loan in the amount of $ 460,406 from the United States Small Business Administration under the Payroll Protection Program.

Subsequent to June 30, 2020, we determined that errors had been made in the application submitted to obtain the loan.

On July 21, 2020, Bank of America notified the Company in writing that it should not have received $440,000 of the loan proceeds, representing an amount for the refinancing of an Economic Injury Disaster Loan which we did receive.

Bank of America has requested that we remit such funds back to Bank of America.

We are presently attempting to negotiate repayment or a restructure of the loan.

If we are not successful in negotiating repayment terms, it could have a material adverse effect on our financial condition.

During management's review of the Company’s recent PPP loan application after the loan had been disbursed to the Company, it was determined that the information provided by Ms.

Smith, the Company’s former President and COO, was not representative of the Company’s situation.

After consulting with legal counsel, the Board of Directors voted to remove Ms.

Smith from its Board of Directors, and all other capacities due to the misstatements she made in the loan application.

Subsequent to that decision, effective July 1, 2020, Ms.

Smith submitted a resignation from all positions with the Company, which was accepted by the Board and management.

Smith subsequently retained counsel and has indicated her intent to file an administrative charge of discrimination in Colorado under certain provisions of the anti-discrimination laws of that state.

On August 18, 2020, the Company received formal notice that a complaint has been filed with the Colorado Civil Rights Division by Ms.

Smith naming the Company as the Respondent.

As of the date of this filing the Company has been advised that the Colorado Civil Rights Division has dismissed this matter effective March 1, 2021.

Smith requested a “Right-to-Sue” letter, which she received, giving her a right to sue in District Court for 90 days from the date of the dismissed action.

On June 23, 2021, the Company and the former President and COO reached a confidential settlement and release agreement releasing both parties of any future claims.

Terra Nova Matter

On May 4, 2021, we were served with a Statement of Nature of Dispute, Claims and Issues to be Arbitrated in which Claimant Terra Nova makes claims related to alleged breach of an agreement between the Parties dated August 17, 2020.

Terra Nova claims damages in the amount of $ 385,000 .

Although we intend to vigorously defend against the claims, there can be no assurance that we will be successful.

There is no pending or anticipated legal actions at this time.

Small Business Administration.

The current balance is $ 460,406 and the Company is currently in discussions for a) a partial forgiveness and b) the conversion of any remaining balance into a term note.

Note 12 -- Subsequent Events

Subsequent to September 30, 2021, the Company initiated a bridge financing round ahead of its anticipated-up listing to a national exchange.

The Company intends to raise between five and six million dollars of a series D preferred stock sold to investors in a private placement.

Each series D unit will have a purchase price of $ 1.00 per Unit, with each Unit consisting of (a) one share of a newly formed Series D Convertible Preferred Stock, par value $0.01 per share (the “Series D Preferred Stock”), (b) one warrant (the “Series A Warrants”) to purchase 2.1 shares of the Company’s common stock, par value $0.01 per share (the “Common Stock”) at a purchase price of $0.50 per whole share of Common Stock, and (c) one warrant (the “Series B Warrants” and together with the Series A Warrants, the “Warrants”) to purchase 2.1 shares of Common Stock at a purchase price of $0.75 per whole share .

As of the date of this filing this filing the Company has closed on $ 3,100,000 .

MANAGEMENT ’ S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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As such, we are seeking innovative technologies that enable both consumers and clinicians to achieve more convenient and better outcomes with greater efficiency.

We have opened our flagship primary care clinic “The Good Clinic” in Northeast Minneapolis, Minnesota.

We plan to open an additional four to five clinics in the Twin Cities area of Minnesota and then continue expansion of two to three clinics in the greater Denver, Colorado area, before the end of 2021.

We opened our flagship primary care clinic “The Good Clinic” in Northeast Minneapolis, Minnesota in February 2021, and have added two additional operating clinics as of the date of this filing.

We announced leases for four (4) plan additional clinics in the Twin Cities area of Minnesota and two (2) new clinics in the greater Denver, Colorado area.

These new locations are expected to open in Q4 of 2021 and Q1 of 2022.

We plan to open clinics in residential concentrations of population to enhance the convenience, especially timely due to the changes in community travel patterns resulting from the pandemic.

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Like the first clinic, we seek to locate clinics convenient to residential centers.

In pursuit of this approach, we intend to continue to expand our relationship with Lennar Corporation and other developers.

In pursuit of this approach, we intend to continue to expand our relationship with Lennar Corporation and other large scale developers.

Already, our clinic is being viewed as an amenity for the high-rise development in which we are located.

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Further, as a result of any acquisitions of other businesses, and any additional pharmacy acquisitions or other such transactions we may pursue, we may experience large expenditures specific to the transactions that are not incident to our operations.

Three months and Six months ended June 30, 2021 and 2020

The Company recognized revenue of approximately $8,200 for the three months ended June 30, 2021, compared to $0 for the three months ended June 30, 2020.

The increase in revenue is the result of the opening of The Good Clinic’s first location.

For the six months ended June 30, 2021, the Company recognized $11,200 of revenue compared to $0 for the six months end June 30, 2020.

The Increase is the result of opening The Good Clinic’s first location.

Comparison of the Three Months Ended September 30, 2021 and 2020

The Company recognized revenue of approximately $13,500 for the three months ended September 30, 2021, compared to $0 for the three months ended September 30, 2020.

The increase in revenue is the result of the opening of The Good Clinic’s three location.

Cost of Sales

The Company incurred approximately $3,600 of cost of goods sold for the three months ended June 30, 2021, compared to $0 for the three months ended June 30, 2020.

The increase in cost of goods sold is the result of the opening of The Good Clinic’s first location.

The Company incurred approximately $5,300 of cost of goods sold for the six months ended June 30, 2021, compared to $0 for the six months ended June 30, 2020.

The increase in cost of goods sold is the result of the opening of The Good Clinic’s first location.

Our gross profit was approximately $4,600 for the three months ended June 30, 2021, compared to $0 for the three months ended June 30, 2020.

Our gross profit was approximately $5,900 for the six months ended June 30, 2021, compared to $0 for the six months ended June 30, 2020.

The Company incurred approximately $2,500 of cost of goods sold for the three months ended September 30, 2021, compared to $0 for the three months ended September 30, 2020.

The increase in cost of goods sold is the result of the opening of The Good Clinic’s third location.

Our gross profit was approximately $11,000 for the three months ended September 30, 2021, compared to $0 for the three months ended September 30, 2020.

Operating Expenses

Our total operating expenses for the three months ended June 30, 2021, were approximately $1,403,200.

Our total operating expenses for the three months ended September 30, 2021, were approximately $1,780,000.

For the comparable period in 2020, the operating expenses were approximately $608,000.

Our total operating expenses for the six months ended June 30, 2021, were $2,356,100 compared to $1,122,300 for the six months ended June 30, 2020

Operating expenses for the three months ended June 30, 2021, were comprised primarily of $357,300 payroll and payroll taxes;

Operating expenses for the three months ended September 30, 2021, were comprised primarily of $581,000 payroll and payroll taxes;

$202,000 of non-cash compensation, $313,000 in legal and professional fees;

$143,000 in marketing;

$157,000 in other operation costs $130,000 in consulting fees.

Operating Expense for the six months ended June 30, 2021, were comprised primarily of $474,900 payroll and payroll taxes;

$423,000 in other operation costs and $147,000 in consulting fees.

Operating expenses for the three months ended September 30, 2020 was $608,000.

Operating expenses for the three months ended September 30, 2020 were comprised primarily of $183,000 in payroll and payroll taxes, including $99,000 in non-cash compensation;

$139,000 in legal and professional fees;

$123,000 in consulting fees, $40,000 in board of director fees;

$81,000 in marketing and public relations;

$31,000 in office and facilities costs;

and $10,000 in insurance costs.

Other Income and Expenses

Interest expense was approximately $0 for the three months ended September 30, 2021, compared to approximately $537,000 for the nine months ended September 30, 2020.

During the three months ended September 30, 2021, the Company declared Preferred Stock dividends of approximately $40,000 compared to approximately $19,000 for the three months ended September 30, 2020.

For the three months ended September 30, 2021, we had a net loss available to common shareholders of approximately $1,810,000 or a net loss per share, basic and diluted of ($0.01) compared to a net loss available to common shareholders of approximately $1,056,000, or a net loss per share, basic and diluted of ($0.01), for the three months ended September 30, 2020.

Comparison of the Nine Months Ended September 30, 2021 and 2020

During the nine months ended September 30, 2021, the Company recognized $25,000 of revenue compared to $0 for the nine months end September 30, 2020.

The Increase is the result of opening The Good Clinic’s three location.

Cost of Sales

The Company incurred approximately $8,000 of cost of goods sold for the nine months ended September 30, 2021, compared to $0 for the nine months ended September 30, 2020.

The increase in cost of goods sold is the result of the opening of The Good Clinic’s three location.

Our gross profit was approximately $17,000 for the nine months ended September 30, 2021, compared to $0 for the nine months ended September 30, 2020.

Operating Expenses

Our total operating expenses for the nine months ended September 30, 2021, were $4,137,000 compared to $1,730,000 for the nine months ended September 30, 2020

Operating Expense for the nine months ended September 30, 2021, were comprised primarily of $1,056,000 payroll and payroll taxes;

$539,000 of non-cash compensation, $920,000 in legal and professional fees;

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$764,000 in other operation costs $413,000 in consulting fees.

Operating expenses for the three months ended June 30, 2020, were comprised primarily of $201,000 in payroll, including $40,000 in non-cash compensation;

$130,000 in legal and professional fees and $120,000 in consulting fees, $110,000 in marketing and public relations, $24,000 in board fees and $14,000 in insurance costs.

Operating expenses for the six months ended June 30, 2020, were composed primarily of $465,000 in payroll and payroll taxes, including $160,000 in non-cash compensation;

Our total operating expenses for the nine months ended September 30, 2020 were $1,730,000.

Operating expenses for the nine months ended September 30, 2020 were composed primarily of $648,000 in payroll and payroll taxes, including $259,000 in non-cash compensation;

$373,000 in legal and professional fees;

$186,000 in consulting fees, $45,000 in board of director fees;

$309,000 in consulting fees, $85,000 in board of director and advisory board fees;

$218,000 in marketing and public relations;

and $32,000 in insurance costs.

$42,000 in insurance costs;

$40,000 in office and facilities costs;

and $15,000 in travel costs.

Other Income and Expenses

Interest expense was approximately $1,000 for the three months ended June 30, 2021, compared to approximately $397,000 for the six months ended June 30, 2020.

During the three months ended June 30, 2021, we recorded a loss on a legal settlement of $70,000.

Interest expense was approximately $966,000 for the nine months ended September 30, 2021, compared to approximately $1,124,000 for the nine months ended September 30, 2020.

During the nine months ended September 30, 2021, we recorded a gain on settlement of accounts payable of approximately $6,000, compared to a gain on settlement of accounts payable in the amount of $397,000 in the prior period.

During the nine months ended September 30, 2020, we recorded a gain on the settlement of notes payable of approximately $1,800.

There was not an equivalent gain or loss in the comparable prior period.

During the three months ended June 30, 2021, the Company declared Preferred Stock dividends of approximately 15,000 compared to approximately $19,000 for the three months ended June 30, 2020.

For the three months ended June 30, 2021, we had a net loss available to common shareholders of approximately $1,485,000 or a net loss per share, basic and diluted of ($0.01) compared to a net loss available to common shareholders of approximately $783,000, or a net loss per share, basic and diluted of ($0.01), for the three months ended June 30, 2020.

Interest expense was approximately $966,000 for the six months ended June 30, 2021, compared to approximately $587,000 for the six months ended June 30, 2020.

During the six months ended June 30, 2021, we recorded a gain on settlement of accounts payable of approximately $6,000, compared to a gain on settlement of accounts payable in the amount of $349,000 in the prior period.

During the six months ended June 30, 2020, we recorded a gain on the settlement of notes payable of approximately $1,800.

During the nine months ended September 30, 2021, the Company declared Preferred Stock dividends of approximately $115,000 compared to approximately $56,000 for the nine months ended September 30, 2020.

During the nine months ended September 30, 2021, we recorded a loss on a legal settlement of $70,000.

There was not an equivalent gain or loss in the comparable prior period.

During the six months ended June 30, 2021, the Company declared Preferred Stock dividends of approximately 367,000 compared to approximately $37,000 for the six months ended June 30, 2020.

For the six months ended June 30, 2021, we had a net loss available to common shareholders of approximately $4,240,000, or a net loss per share, basic and diluted of ($0.02) compared to a net loss available to common shareholders of approximately $948,000, or a net loss per share, basic and diluted of ($0.01), for the six months ended June 30, 2020.

For the nine months ended September 30, 2021, we had a net loss available to common shareholders of approximately $6,089,000, or a net loss per share, basic and diluted of ($0.03) compared to a net loss available to common shareholders of approximately $2,004,000, or a net loss per share, basic and diluted of ($0.02), for the nine months ended September 30, 2020.

Liquidity and Capital Resources

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We have financed our operations through the sale of equity securities and short-term borrowings.

As of June 30, 2021, we had cash of approximately $1,686,000 compared to cash of approximately $65,000 as of December 31, 2020.

Net cash used in operating activities was approximately $2,134,000 for the six months ended June 30, 2021.

This is the result of our business development efforts pertaining to the start-up of the first clinic.

Cash used in operations for the six months ended June 30, 2020, was approximately $826,000.

Net cash used in investing activities was approximately $495,000 for the six months ended June 30, 2021.

As of September 30, 2021, we had cash of approximately $442,000 compared to cash of approximately $65,000 as of December 31, 2020.

Net cash used in operating activities was approximately $1,625,000 for the nine months ended September 30, 2021.

This is the result of our business development efforts pertaining to the start-up of the first three clinics.

Cash used in operations for the nine months ended September 30, 2020, was approximately $1,192,000.

Net cash used in investing activities was approximately $2,300,000 for the nine months ended September 30, 2021.

The amounts relate to the purchase of fixed assets and leasehold improvement on our first clinic.

No cash was used for investing activities for the six months ended June 30, 2020.

Net cash provided by financing activities for the six months ended June 30, 2021, was approximately $4,250,000, consisting of proceeds from a private placement offering of common stock of $1,668,000 and $2,760,000 from the sale of Series C Preferred Stock and warrants.

No cash was used for investing activities for the nine months ended September 30, 2020.

Net cash provided by financing activities for the nine months ended September 30, 2021, was approximately $4,302,000, consisting of proceeds from a private placement offering of common stock of $1,668,000 and $2,760,000 from the sale of Series C Preferred Stock and warrants.

Partially offsetting the proceeds was approximately $178,000 of payment on notes payable.

Net cash provided by financing activities for the six months ended June 30, 2020, was approximately $760,000 consisting of approximately $931,000 of proceeds from notes payable offset by payments on notes payable of approximately $171,000.

Net cash provided by financing activities for the nine months ended September 30, 2020, was approximately $1,210,000 consisting of approximately $1,381,000 of proceeds from notes payable offset by payments on notes payable of approximately $171,000.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements