What changed in this filing

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Item 2. Properties

2024-04-16 compared with 2023-07-14 · 56 added, 36 removed, 20 unchanged (82% of the section changed)

The following lists the rental agreements we had in place as of December 31, 2022.

As a result of our revised plans for The Good Clinic, and because of the limited availability of additional capital, we are in the process of negotiating the termination of most of these sites.

As a result of our revised plans for The Good Clinic, and because of the limited availability of additional capital, we are in the process of negotiating the termination of these sites.

As noted below our limited capital has caused some of our relationships with vendors and landlords to include some litigation, further noted in other parts of this document.

Settlements on Sites Operated by The Good Clinic, LLC Subsidiary

Nordhaus Clinic

On November 1, 2020, we entered into an agreement to open a clinic in Minneapolis, Minnesota.

1 unchanged sentence

Fixed rent payments under the initial term are approximately $511,000.

On November 6, 2023, the Company received a termination notice from the landlord indicating the lease had been terminated.

No additional claims have been received by the landlord and the Company believes no additional amounts are owed.

Egan Clinic a.k.a Vikings

On October 14, 2021, we entered into an agreement to open a clinic in Eagan, Minnesota, which began operations in the fourth quarter of 2021.

The initial lease term is for 96 months.

Fixed rent payments under the initial term are approximately $767,000.

A Summary Judgment was granted on December 4, 2023, in the amount of $488,491, and the entry of final judgment was entered on December 15, 2023 and the Company has released the property back to the leaseholder.

Paul Clinic a.k.a.

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

Paul, Minnesota, which began operations in the fourth quarter of 2021.

The initial lease term is for 114 months.

Fixed rent payments under the initial term are approximately $1,153,000.

A stipulation for Judgment was filed on December 21, 2023 in the amount of $415,266.

The stipulated judgment includes $178,542 in unpaid back rent, $172,124 in resolution of mechanics’ liens, and $64,600 in attorneys’ fees.

Final entry of judgment by the Court was entered against the Company on January 19, 2024, and the Company has released the property back to the leaseholder.

Louis Park Clinic a.k.a.

Excelsior & Grand

On May 24, 2021, we entered into an agreement to open a clinic in St.

2 unchanged sentences

Fixed rent payments under the initial term are approximately $673,000.

Additionally, on June 8, 2021, we entered into an agreement to open a clinic in Eden Prairie, Minnesota, which began operation in the third quarter of 2021.

The Company agreed to and executed a Confession of Judgment in the amount of $425,351 on April 2, 2024 and has released the property back to the leaseholder.

We received the fully executed and recorded judgement on April 10, 2024.

Eden Prairie Clinic a.k.a.

On June 8, 2021, we entered into an agreement to open a clinic in Eden Prairie, Minnesota, which began operation in the third quarter of 2021.

The initial lease term is eight years.

Fixed rent payments under the initial term are approximately $620,000.

On June 24, 2021, we entered into an agreement to open an administrative office in St.

Louis Park, Minnesota.

The initial lease term is 2.5 years.

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

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

Paul, Minnesota, which began operations in the fourth quarter of 2021.

The Company has surrendered possession of the property and is currently in negotiations the amounts owed and is in the process of settling the remaining amounts owed.

Maple Grove Clinic a.k.a.

On October 8, 2021, we entered into an agreement to open a clinic in Maple Grove, Minnesota which began operation in the fourth quarter of 2021.

The initial lease term is for 108 months.

Fixed rent payments under the initial term are approximately $1,153,127.

On October 22, 2022, the Company entered into a settlement agreement with the leaseholder for $219,576 and the Company has released the property back to the leaseholder.

Radiant Clinic a.k.a.

On September 9, 2021, we entered into an agreement to open a clinic in Denver, Colorado, which was expected to begin operation in the first quarter of 2023 but possession of which has been relinquished to the landlords.

1 unchanged sentence

Fixed rent payments under the initial term are approximately $782,000.

As of April 10, 2024, the Company has settled the amounts owed to the leaseholder and full resolution of all liens for approximately $530,000 and the Company has released the property back to the leaseholder.

Quincy Clinic a.k.a.

On September 28, 2021, we entered into an agreement to open a clinic in Denver, Colorado, which was expected to begin operation in the first quarter of 2023 but possession of which has been relinquished to the landlords.

1 unchanged sentence

Fixed rent payments under the initial term are approximately $1,079,000.

On October 8, 2021, we entered into an agreement to open a clinic in Maple Grove, Minnesota which began operation in the fourth quarter of 2021.

The initial lease term is for 108 months.

Fixed rent payments under the initial term are approximately $1,153,127.

On October 14, 2021, we entered into an agreement to open a clinic in Eagan, Minnesota, which began operations in the fourth quarter of 2021.

The initial lease term is for 96 months.

Fixed rent payments under the initial term are approximately $767,000.

On April 4, 2022, we entered into an agreement to open a clinic in Wayzata, Minnesota, which was expected to begin operations in the first quarter of 2023.

The initial lease term is for 90 months.

A Final Judgment was granted on November 14, 2023, in the amount of $348,764 including interest, fees and other costs.

The Company has released the property back to the leaseholder.

The following table summarizes the status of our property settlements as noted above and the total settlement amounts as of the date of the filing:

ALSO KNOWN AS:

PROPERTY NAME/OWNER

ORIGINAL OBLIGATION

SETTLEMENT AMOUNT

TYPE OF SETTLEMENT

MINNEAPOLIS, MN

CASH PAYMENT OBLIGATION

DEFAULT JUDGEMENT

LOUIS PARK, MN

EXCELSIOR & GRAND

DEFAULT JUDGEMENT

CONTINENTAL 560

DEFAULT JUDGEMENT

MAPLE GROVE, MN

SETTLEMENT AGREE

DEFAULT JUDGEMENT

Administrative offices

On June 24, 2021, we entered into an agreement to open an administrative office in St.

Louis Park, Minnesota.

The initial lease term is 2.5 years.

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

As of February 3, 2023 this lease obligation was terminated.

We agreed to pay a $25,000 termination fee.

On July 25 and July 29, 2022 two mechanic’s lien in the total amount of $373,396 were placed on our St.

Paul, MN The Grove clinic.

On July 29, 2022 a mechanic’s lien in the amount of $136,210 was placed on our Eagan, MN Vikings Parkway clinic.

On July 29, 2022 a mechanic’s lien in the amount of $137,800 was placed on our Maple Grove, MN Arbor Lakes clinic.

This amount has since been paid in full and we are in the process of removing the lien.

On August 22 and August 26, 2022 two mechanic’s lien in the total amount of $616,785 was placed on our Denver, CO Quincy clinic.

On August 22 and August 26, 2022 two mechanic’s lien in the amount of $593,162 was placed on our Denver, CO Radiant clinic.

On October 4, 2022 a mechanic’s lien in the amount of $334,508 was placed on our St.

Louis Park, MN clinic.

On November 16, 2022 a mechanic’s lien in the amount of $961,577 was placed on our Eagan, MN Vikings Parkway clinic.

On or about December 20, 2022 a mechanic’s lien in the amount of $27,951 was placed on the Wayzata, MN.

All liens were filed pursuant to Minnesota’s and Colorado’s Mechanic’s statutes and relate to past due obligations for construction and related work on certain of our clinics.

Pursuant to Minnesota’s and Colorado’s Mechanic’s statutes, the contractor-creditors may have the ability to commence a mechanic’s lien foreclosure action against the real properties in question to recover amounts due, costs, legal fees, and interest.

Additionally, the mechanic’s liens could result in defaults under our leases for the affected clinic locations.

If that occurs, the leases for the affected clinic locations allow for acceleration of amounts due under the lease, among other damages and remedies.

We are attempting to negotiate modifications to our agreements with the contractor-creditors.

However, we cannot assure you that our efforts will be successful.

If we are unable to timely clear the mechanic’s liens filed against our clinics or otherwise negotiate modifications to our agreements with the contractor-creditors, it will have a material adverse impact on our business, results of operations, and financial condition.

We have not entered into a settlement agreement on this site as of the date of this filing but expect to shortly.

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-K

Item 2. Properties