Cover
Cover - shares | 3 Months Ended | |
Sep. 30, 2021 | Nov. 22, 2021 | |
Cover [Abstract] | ||
Entity Registrant Name | Innovative MedTech, Inc. | |
Entity Central Index Key | 0001331612 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Current Fiscal Year End Date | --06-30 | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Emerging Growth Company | false | |
Entity Current Reporting Status | No | |
Document Period End Date | Sep. 30, 2021 | |
Entity Filer Category | Non-accelerated Filer | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2022 | |
Entity Common Stock Shares Outstanding | 15,657,327 | |
Document Quarterly Report | true | |
Entity File Number | 000-51390 | |
Entity Incorporation State Country Code | DE | |
Entity Tax Identification Number | 33-1130446 | |
Entity Address Address Line 1 | 2310 York St. | |
Entity Address Address Line 2 | Suite 200 | |
Entity Address City Or Town | Blue Island | |
Entity Address State Or Province | IL | |
Entity Address Postal Zip Code | 60406 | |
City Area Code | 708 | |
Local Phone Number | 925-9424 | |
Entity Interactive Data Current | Yes | |
Document Transition Report | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Sep. 30, 2021 | Jun. 30, 2021 |
Current assets | ||
Cash | $ 106,825 | $ 433,435 |
Accounts receivable, net | 187,947 | 178,555 |
Notes receivable | 112,283 | 63,453 |
Prepaid expenses | 111 | 1,745 |
Total current assets | 407,166 | 677,188 |
Notes receivable, non-current | 14,466 | 0 |
Deposits | 10,331 | 10,331 |
Right-of-use asset | 716,869 | 757,313 |
Property, plant and equipment, net of accumulated depreciation | 312,079 | 325,788 |
Goodwill | 3,473,264 | 3,473,264 |
Total Assets | 4,934,175 | 5,243,884 |
Current liabilities | ||
Accounts payable and accrued expenses | 804,174 | 775,969 |
Accrued interest | 534,087 | 520,205 |
Accrued interest, related parties | 18,431 | 9,459 |
Notes payable, related parties, current | 514,438 | 514,438 |
Notes payable, current | 129,491 | 200,705 |
Convertible notes payable, current | 349,900 | 349,900 |
Derivative liability | 189,548 | 254,700 |
Lease liability | 171,297 | 166,895 |
Total current liabilities | 2,711,366 | 2,792,271 |
Royalty liability | 1,500,000 | 1,500,000 |
Lease liability, non-current | 545,932 | 590,418 |
Paycheck protection loan | 266,640 | 266,640 |
SBA Loan | 150,000 | 150,000 |
Total Liabilities | 5,173,938 | 5,299,329 |
Stockholders' Deficit | ||
Series A Preferred stock, $0.000001 par value; 500,000,000 authorized: 317,500 shares issued and outstanding at September 30, 2021 and June 30, 2021, respectively | 0 | 0 |
Common stock, $0.000001 par value; 130,000,000 shares authorized; 15,657,327 and 15,557,327 shares issued and outstanding at September 30, 2021 and June 30, 2021, respectively | 16 | 16 |
Additional paid in capital | 14,935,551 | 14,860,551 |
Accumulated deficit | (15,175,330) | (14,916,012) |
Total Stockholders' Deficit | (239,763) | (55,445) |
Total Liabilities and Stockholders' Deficit | $ 4,934,175 | $ 5,243,884 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2021 | Jun. 30, 2021 |
STOCKHOLDERS' EQUITY | ||
Preferred stock, shares authorized | 500,000,000 | 500,000,000 |
Preferred stock, shares par value | $ 0.000001 | $ 0.000001 |
Preferred stock, shares issued | 317,500 | 317,500 |
Preferred stock, shares outstanding | 317,500 | 317,500 |
Common stock, shares par value | $ 0.000001 | $ 0.000001 |
Common stock, shares authorized | 130,000,000 | 130,000,000 |
Common stock, shares issued | 15,657,327 | 15,557,327 |
Common stock, shares outstanding | 15,657,327 | 15,557,327 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS UNAUDITED - USD ($) | 3 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Revenue: | ||
Participant fees | $ 193,910 | $ 0 |
Franchise fees | 122,656 | 0 |
Revenue | 316,566 | 0 |
Operating expenses: | ||
General and administrative | 237,642 | 12,195 |
Salaries and wages | 226,939 | 6,075 |
Consulting fees | 102,525 | 0 |
Legal and professional fees | 47,617 | 15,000 |
Total operating expenses | 614,723 | 33,270 |
Loss from operations | (298,157) | (33,270) |
Other income (expense): | ||
Interest expense, related parties | (8,972) | (9,459) |
Interest expense | (17,341) | (58,505) |
Change in fair value of derivatives | 65,152 | (129,228) |
Total other income (expense) | 38,839 | (197,192) |
Net loss | $ (259,318) | $ (230,462) |
Basic and diluted earnings per share on net loss | $ (0.02) | $ 0 |
Weighted average shares outstanding - basic and diluted | 15,574,718 | 292,211 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT - USD ($) | Total | Series A Preferred Stock [Member] | Common Stock | Common Stock To Be Issued [Member] | Additional Paid-in Capital | Accumulated Deficit |
Balance, shares at Jun. 30, 2020 | 47,400,000 | 292,211 | 50,000 | |||
Balance, amount at Jun. 30, 2020 | $ (4,038,615) | $ 47 | $ 0 | $ 0 | $ 7,612,393 | $ (11,651,055) |
Net loss | (230,462) | $ 0 | $ 0 | $ 0 | 0 | (230,462) |
Balance, shares at Sep. 30, 2020 | 47,400,000 | 292,211 | 50,600 | |||
Balance, amount at Sep. 30, 2020 | (4,269,077) | $ 47 | $ 0 | $ 0 | 7,612,393 | (11,881,517) |
Balance, shares at Jun. 30, 2020 | 47,400,000 | 292,211 | 50,000 | |||
Balance, amount at Jun. 30, 2020 | (4,038,615) | $ 47 | $ 0 | $ 0 | 7,612,393 | (11,651,055) |
Balance, shares at Jun. 30, 2021 | 317,500 | 15,557,327 | ||||
Balance, amount at Jun. 30, 2021 | (55,445) | $ 0 | $ 16 | 0 | 14,860,551 | (14,916,012) |
Net loss | (259,318) | 0 | $ 0 | 0 | 0 | (259,318) |
Issuance of Common Stock for Services, shares | 100,000 | |||||
Issuance of Common Stock for Services, amount | 75,000 | $ 0 | $ 0 | 0 | 75,000 | 0 |
Balance, shares at Sep. 30, 2021 | 317,500 | 15,657,327 | ||||
Balance, amount at Sep. 30, 2021 | $ (239,763) | $ 0 | $ 16 | $ 0 | $ 14,935,551 | $ (15,175,330) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS UNAUDITED - USD ($) | 3 Months Ended | 12 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | Jun. 30, 2021 | |
Cash Flows from Operating Activities | |||
Net Loss | $ (259,318) | $ (230,462) | |
Adjustments to reconcile net loss to net cash used by operating activities: | |||
Depreciation | 13,709 | 0 | |
Stock compensation | 75,000 | 0 | |
Change in fair value of derivatives | (65,152) | 129,228 | |
Right-of-use asset | 360 | 0 | |
Changes in operating assets & liabilities | |||
Accounts receivable | (9,392) | 0 | |
Prepaid expenses | 1,634 | 0 | |
Accounts payable and accrued liabilities | 28,205 | 12,000 | |
Accounts payable and accrued liabilities, related party | 0 | 67,964 | |
Accounts interest, related party | 8,972 | 0 | |
Accrued interest | 13,882 | 0 | |
Net cash used by operating activities | (192,100) | (21,270) | |
Cash Flows from Investing Activities | |||
Notes receivable | (63,296) | 0 | |
Net cash provided by investing activities | (63,296) | 0 | |
Cash Flows from Financing Activities | |||
Proceeds from convertible notes payable | 0 | 37,600 | |
Payments on convertible notes payable | (71,214) | 0 | |
Net cash provided by financing activities | (71,214) | 37,600 | |
(Decrease) increase in Cash | (326,610) | 16,330 | |
Cash at beginning of period | 433,435 | 766 | $ 766 |
Cash (and equivalents) at end of period | 17,096 | $ 433,435 | |
Supplemental Cash Flow Information | |||
Cash paid for interest | 0 | 0 | |
Cash paid for income taxes | $ 0 | $ 0 |
GENERAL ORGANIZATION AND BUSINE
GENERAL ORGANIZATION AND BUSINESS | 3 Months Ended |
Sep. 30, 2021 | |
GENERAL ORGANIZATION AND BUSINESS | |
NOTE 1. GENERAL ORGANIZATION AND BUSINESS | NOTE 1. GENERAL ORGANIZATION AND BUSINESS Innovative MedTech, Inc. (the “Company”), a Delaware corporation, is a provider of health and wellness services. On February 1, 2021, the Company filed all required Form 10-Q’s and 10-K’s to be up to date with its filings before filing its Form 15-12G on November 7, 2014. On February 11, 2021, the Company filed with FINRA to effectuate a 10,000:1 reverse stock split, change its name from Fresh Harvest Products, Inc. to Innovative MedTech, Inc. and change its stock symbol from ‘FRHV’ to ‘IMTH’. FINRA permitted these corporate actions on March 8, 2021. The 10,000:1 reverse split and the name change from Fresh Harvest Products, Inc., to Innovative MedTech, Inc. corporate actions took effect at the open of business on March 9, 2021. On March 25, 2021, the Company acquired two companies, Sarah Adult Day Services, Inc., and Sarah Day Care Centers, Inc. (“SarahCare”), an adult day care center franchisor and provider, for a total of $3,718,833; $2,000,110 was paid in cash and the Company assumed approximately $393,885 in debt due to sellers, and the remaining is payable through a royalty fee liability due in the amount of $1,500,000. With 28 centers (2 corporate and 26 franchise locations) located in 13 states, SarahCare offers seniors daytime care and activities ranging from meeting their physical and medical needs, on a daily basis, ranging from nursing care to salon services and providing meals, to offering engaging and enriching activities to allow them to continue to lead active and engaged lives. On March 25, 2021 the Company received a $2 million investment in the form of a private investment in public equity (“PIPE”) from several investors. For the $2 million PIPE, the investors received a combination of common stock and Series A Preferred Stock which together constitute ownership of 84.11% of the Company, 83.00% on a fully diluted basis. On April 21, 2021, the Company formed ten wholly-owned limited liability companies which will operate ten additional SarahCare facilities. As of September 30, 2021 the newly formed entities are non-operating. Operations expect to begin in May 2022. The Company continues to have limited capital resources and has experienced net losses and negative cash flows from operations and expects these conditions to continue for the foreseeable future. As of September 30, 2021, the Company had $106,825 cash available for operations and had an accumulated deficit of $15,175,330. Management believes that cash on hand as of September 30, 2021 is not sufficient to fund operations through June 30, 2022. The Company will be required to raise additional funds to meet its short and long-term planned goals. There can be no assurance that such funds, if available at all, can be obtained on terms reasonable to the Company. |
LIQUIDITY, CAPITAL RESOURCES AN
LIQUIDITY, CAPITAL RESOURCES AND GOING CONCERN | 3 Months Ended |
Sep. 30, 2021 | |
LIQUIDITY, CAPITAL RESOURCES AND GOING CONCERN | |
NOTE 2. LIQUIDITY, CAPITAL RESOURCES AND GOING CONCERN | NOTE 2. LIQUIDITY, CAPITAL RESOURCES AND GOING CONCERN The accompanying consolidated financial statements have been prepared on a going-concern basis, which contemplates the continuation of operations, realization of assets and liquidation of liabilities in the ordinary course of business. For the quarters ended September 30, 2021 and 2020, the Company reported a net loss of $259,318 and $230,462, respectively. As of September 30, 2021, the Company maintained total assets of $4,934,175, total liabilities including long-term debt of $5,173,938 along with an accumulated deficit of $15,175,330. The Company believes that additional capital will be required to fund operations through June 30, 2022 and beyond, as it attempts to generate increasing revenue, and develop new products. The Company intends to attempt to raise capital through additional equity offerings and debt obligations. There can be no assurance that the Company will be successful in obtaining financing at the level needed or on terms acceptable to the Company. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying annual consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Sep. 30, 2021 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
NOTE 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) and reflect all adjustments, consisting of normal recurring adjustments, which management believes are necessary to fairly present the financial position, results of operations and cash flows of the Company as of and for the quarters ended September 30, 2021 and 2020. Principles of Consolidation The Company has two wholly-owned operating subsidiaries; Sarah Adult Day Services, Inc., and Sarah Day Care Centers, Inc. The consolidated financial statements, which include the accounts of the Company and its two wholly-owned operating subsidiaries, are prepared in conformity GAAP. All significant intercompany balances and transactions have been eliminated. The consolidated financial statements, which include the accounts of the Company and its wholly-owned operating subsidiaries, and related disclosures have been prepared pursuant to the rules and regulations of the SEC. The consolidated financial statements have been prepared using the accrual basis of accounting in accordance with GAAP and presented in US dollars. The fiscal year end is June 30. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported revenues and expenses during the reporting periods. Because of the use of estimates inherent in the financial reporting process, actual results may differ significantly from those estimates. Cash and Cash Equivalents The Company maintains cash balances in a non-interest-bearing account that currently does not exceed $250,000 at September 30, 2021. For the purpose of the consolidated statements, all highly liquid investments with a maturity of three months or less are considered to be cash equivalents. There were no cash equivalents as of September 30, 2021 and 2020. Earnings Per Share Calculation Basic earnings per common share (“EPS”) is computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted earnings per share is computed by dividing net income by the weighted average shares outstanding, assuming all dilutive potential common shares were issued. Revenue Recognition Revenue is recognized when a customer obtains control of promised goods or services. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for those goods. The Company applies the following five-step model in order to determine this amount: (i) identification of the promised goods in the contract; (ii) determination of whether the promised goods are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. Once a contract is determined to be within the scope of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606 at contract inception, the Company reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. Participant Fees Resident fee revenue is reported at the amount that reflects the consideration the Company expects to receive in exchange for the services provided. These amounts are due from participants or third-party payors and include variable consideration for retroactive adjustments from estimated reimbursements, if any, under reimbursement programs. Performance obligations are determined based on the nature of the services provided. Resident fee revenue is recognized as performance obligations are satisfied. Under the Company’s day care agreements, which are generally for a contractual term of 30 days to one year, the Company provides services to participants for a stated daily or monthly fee. The Company has elected the lessor practical expedient within ASC 842, Leases Revenue Recognition from Contracts with Customers The Company enters into contracts to provide home assisted health, and certain outpatient services. Each service provided under the contract is capable of being distinct, and thus, the services are considered individual and separate performance obligations. The performance obligations are satisfied as services are provided and revenue is recognized as services are provided. The Company receives payment for services under various third-party payor programs which include Medicaid, Veterans Affairs and other third-party payors. Estimates for settlements with third-party payors for retroactive adjustments from estimated reimbursements due to audits, reviews, or investigations are included in the determination of the estimated transaction price for providing services. The Company estimates the transaction price based on the terms of the contract with the payor, correspondence with the payor, and historical payment trends. Changes to these estimates for retroactive adjustments are recognized in the period the change or adjustment becomes known or when final settlements are determined. Billings for services under third-party payor programs are recorded net of estimated retroactive adjustments, if any. Retroactive adjustments are accrued on an estimated basis in the period the related services are rendered and adjusted in future periods or as final settlements are determined. Contractual or cost related adjustments from Medicaid or Veterans Affairs are accrued when assessed (without regard to when the assessment is paid or withheld). Subsequent adjustments to these accrued amounts are recorded in net revenues when known. Franchise Fees The Company franchises a number of its locations under franchise contracts which provide periodic franchise fee payments to the Company and reimbursement for costs and expense related to such franchises. The Company’s franchisees pay a variety of royalties and fees, including an agreed upon percentage of gross revenues (as defined in the franchise agreement). The Company estimates the amount of franchise fee revenue expected to be earned, if any, during the annual contract period and revenue is recognized as services are provided. The Company’s estimate of the transaction price for the franchise services also includes the amount of reimbursement due from the franchises for services provided and related costs incurred. Such revenue is included in “revenues” on the consolidated statements of operations. The related costs are included in “operating expenses” on the consolidated statements of operations. SarahCare, as the franchisor, supplies the Franchisee’s with initial assistance and approval with the following: (1) Give you our site selection criteria for the SARAH Business and, upon a potential Franchisee’s request, provide input regarding possible sites. We do not own and lease any site to franchisees. After they select and we approve a site, we will designate the geographic area within which they may establish the SARAH Business; (2) Approve the signage; (3) Identify the standards and specifications for products, services, and materials that comply with the System, and, if we require, the approved suppliers of these items. We will furnish a potential Franchisee with the listing of the package of initial franchise items as detailed in the Operations Manual. Neither we nor our affiliate provide, deliver, or install any of these items; (4) Provide an Initial Training Program; and (5) Provide an Operations Training Program. Once the Franchisee’s SarahCare business is operational, we will: (1) Issue and modify System standards for SARAH Businesses; (2) Provide access to a copy of our Operations Manual as we make available through our intranet. The Operations Manual contains mandatory and suggested specifications, standards and operating procedure; (3) Give you additional or special guidance and assistance and training as we deem appropriate and for which a potential Franchisee are financially responsible; (4) Inspect and observe the operation of the SARAH Business to help a potential Franchisee comply with the Franchise Agreement and all System standards; (5) Let you use the confidential information; and, (6) Let you use the Marks (trademarks, trade names, service marks, and logos). Income Taxes The provision for income taxes is the total of the current taxes payable and the net of the change in the deferred income taxes. Provision is made for the deferred income taxes where differences exist between the period in which transactions affect current taxable income and the period in which they enter into the determination of net income in the financial statements. Leases On December 1, 2018, the Company adopted ASU 2016-02, “ Leases Fair value of financial instruments The Company’s financial instruments include cash and cash equivalents, accounts payable, accrued expenses, and debt. The carrying value of these financial instruments is considered to be representative of their fair value due to the short maturity of these instruments. The carrying amount of the debt approximates fair value, because the interest rates on these instruments approximate the interest rate on debt with similar terms available to the Company. The Company’s derivative liabilities were adjusted to fair market value at the end of each reporting period, using Level 3 inputs. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability, in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The fair value hierarchy is based on three levels of inputs, of which the first two are considered observable and the last unobservable, as follows: Level 1 – Quoted prices in active markets for identical assets or liabilities. Level 2 – Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the measurement of the fair value of the assets or liabilities. The carrying amounts of the Company’s financial assets and liabilities, such as cash, accounts payable, accrued expenses and interest, certain notes payable and notes payable – due to related parties, approximate their fair values because of the short maturity of these instruments. The Company accounts for its derivative liabilities, at fair value, on a recurring basis under Level 3 (See Note 11). Embedded Conversion Features The Company evaluates embedded conversion features within convertible debt under ASC 815 “ Derivatives and Hedging Debt with Conversion and Other Options Derivative financial instruments When the Company issues debt that contains a conversion feature, it first evaluates whether the conversion feature meets the requirements to be treated as a derivative: a) one or more underlying, typically the price of the Company’s stock; b) one or more notional amounts or payment provisions or both, generally the number of shares upon conversion; c) no initial net investment, which typically excludes the amount borrowed; and d) net settlement provisions, which in the case of convertible debt generally means the stock received upon conversion can be readily sold for cash. There are certain scope exceptions from derivative treatment, but these typically exclude conversion features that provide for a variable number of shares. If the conversion features within convertible debt meet the requirements to be treated as a derivative, the Company estimates the fair value of the derivative liability using the Monte Carlo Simulation Model upon the date of issuance. If the fair value of the derivative liability is higher than the face value of the convertible debt, the excess is immediately recognized as interest expense. Otherwise, the fair value of the derivative liability is recorded as a liability with an offsetting amount recorded as a debt discount, which offsets the carrying amount of the debt. The derivative liability is revalued at the end of each reporting period and any change in fair value is recorded as a change in fair value in the consolidated statements of operations. The debt discount is amortized through interest expense over the life of the debt. Derivative instrument liabilities and the host debt agreement are classified on the consolidated balance sheets as current or non-current based on whether settlement of the derivative instrument could be required within twelve months of the balance sheet date. The accounting treatment of derivative financial instruments requires that the Company record the embedded conversion option at their fair values as of the inception date of the agreement and at fair value as of each subsequent balance sheet date. Any change in fair value is recorded as non-operating, non-cash income or expense for each reporting period at each balance sheet date. The Company reassesses the classification of its derivative instruments at each balance sheet date. If the classification changes as a result of events during the period, the contract is reclassified as of the date of the event that caused the reclassification. As a result of entering into warrant agreements, for which such instruments contained a variable conversion feature with no floor, the Company has adopted a sequencing policy in accordance with ASC 815-40-35-12 “ Derivatives and Hedging Debt Issue Costs and Debt Discount The Company may record debt issue costs and/or debt discounts in connection with raising funds through the issuance of debt. These costs may be paid in the form of cash, or equity (such as warrants). These costs are amortized to interest expense over the life of the debt. If a conversion of the underlying debt occurs, a proportionate share of the unamortized amounts is immediately expensed. Recently Issued Accounting Pronouncements As of and for the quarter ended September 30, 2021, the Company does not expect any of the recently issued accounting pronouncements to have a material impact on its financial condition or results of operations. Subsequent Events In accordance with ASC 855, Subsequent Events |
BUSINESS ACQUISITION
BUSINESS ACQUISITION | 3 Months Ended |
Sep. 30, 2021 | |
BUSINESS ACQUISITION | |
NOTE 4. BUSINESS ACQUISITION | NOTE 4. BUSINESS ACQUISITION On March 25, 2021 the Company acquired two companies, Sarah Adult Day Services, Inc., and Sarah Day Care Centers, Inc. (“SarahCare”), an adult day care center franchisor and provider. The combined purchase price was $3,718,833. The purchase price was paid as follows: (i) $2,000,110 was paid in cash, (ii) the Company assumed $393,885 in debt due to sellers, and (iii) the remaining is payable through a royalty fee liability due in the amount of $1,500,000. Consideration Cash $ 2,000,110 Legal fees (175,162 ) Notes payable due to sellers 393,885 Royalty fee liability 1,500,000 Total consideration $ 3,718,833 Fair value of net identifiable assets (liabilities) acquired Cash $ 412,276 Accounts receivable 84,674 Deposits and prepaid expenses 15,139 Notes receivable 110,510 Property, plant and equipment 335,426 Right of use asset 796,771 Total fair value of net identifiable assets $ 1,754,796 Accounts payable and accrued expenses $ 625,462 Notes payable, current, net of debt discount 454,524 PPP Loan 439,160 Lease Liability 796,771 Total fair value of net identifiable liabilities $ 2,315,917 Fair value of net identifiable assets (liabilities) acquired $ (561,121 ) Goodwill $ 4,279,954 The Company analyzed the acquisition under applicable guidance and determined that the acquisition should be accounted for as a business combination. The initial accounting for the business combination is not completed and the fair value of the acquired identifiable intangible assets are provisional pending receipt of the final valuations for those assets. On June 30, 2021, the Company performed a test to determine if goodwill should be impaired. The test determined that the fair value of the reporting units was less than its carrying value. As such the Company recorded a loss on impairment of goodwill in the amount of $806,690. Pro Forma Disclosures The following unaudited pro forma financial results reflects the historical operating results of the Company, including the unaudited pro forma results of Sarah Adult Day Services, Inc., and Sarah Day Care Centers, Inc. for the year ended June 30, 2021, as if each of these business combinations had occurred as of July 1, 2019. The pro forma financial information set forth below reflects adjustments to the historical data of the Company to give effect to each of these acquisitions and the related equity issuances as if each had occurred on July 1, 2019. The pro forma information presented below does not purport to represent what the actual results of operations would have been for the periods indicated, nor does it purport to represent the Company’s future results of operations. The following table summarizes on an unaudited pro forma basis the Company’s results of operations for the year ended June 30, 2021: 2021 Net revenue $ 677,997 Net loss $ (3,513,187 ) Net loss per share- basic and diluted $ (0.60 ) Weighted average number of shares of common stock outstanding- basic and diluted 2,117,130 The calculations of pro forma net revenue and pro forma net loss give effect to the business combinations for the period from July 1, 2019 until the respective closing dates for (i) the historical net revenue and net income (loss), as applicable, of the acquired businesses, (ii) incremental depreciation and amortization for each business combination based on the fair value of property, equipment and identifiable intangible assets acquired and the related estimated useful lives, and (iii) recognition of accretion of discounts on obligations with extended payment terms that were assumed in the business combinations. |
NOTES RECEIVABLE
NOTES RECEIVABLE | 3 Months Ended |
Sep. 30, 2021 | |
NOTES RECEIVABLE | |
NOTE 5. NOTES RECEIVABLE | NOTE 5. NOTES RECEIVABLE The Company’s wholly-owned subsidiary Sarah Adult Day Services, Inc., has notes receivables from two franchises, which were previously converted from trade receivables. They are as follows: September 30, June 30, 2021 2021 Notes receivable from a franchise, due in monthly installments of $5,000, no interest, maturing December 2021 $ 11,468 $ 21,468 Notes receivable from a franchise, due in monthly installments of $1,999, no interest, maturing March 2023 35,987 41,985 Note receivable from related party (see Note 17), due in six months, with no installments, 5% interest maturing March 2022 79,294 - Total notes receivable 126,749 63,453 Less long-term (14,466 ) (14,466 ) Total short term notes receivable $ 112,283 $ 48,987 Principal to be collected during the next three years is as follows: 2022 $ 112,283 2023 14,466 $ 126,749 |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 3 Months Ended |
Sep. 30, 2021 | |
PROPERTY, PLANT AND EQUIPMENT | |
Note 6. PROPERTY, PLANT AND EQUIPMENT | NOTE 6. PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consisted of the following at September 30, 2021 and June 30, 2021: September 30, 2021 June 30, 2021 Leasehold improvements $ 294,864 $ 294,864 Vehicles 22,554 22,554 Computer equipment 12,553 12,553 Furniture and fixtures 5,455 5,455 335,426 335,426 Less: Accumulated depreciation (23,347 ) (9,638 ) Property, plant and equipment - net $ 312,079 $ 325,788 The property, plant and equipment was acquired in the acquisition discussed in Note 4. Depreciation expense was $13,710 and $9,638 for the three months ended September 30, 2021 and June 30, 2021. |
NOTES PAYABLE
NOTES PAYABLE | 3 Months Ended |
Sep. 30, 2021 | |
NOTES PAYABLE | |
NOTE 7. NOTES PAYABLE | NOTE 7. NOTES PAYABLE As of September 30 and June 30, 2021, the Company had $129,491 and $200,705, respectively, in outstanding notes payable. All of these notes were assumed in connection with the acquisition on March 25, 2021. Ref No. Date of Note Issuance Original Principal Balance Maturity Date Interest Rate % Principal Balance 9/30/21 Principal Balance 6/30/2020 1 12/25/2020 $ 146,021 12/15/2020 10 $ 129,491 $ 137,755 2 3/25/2021 37,949 6/3/2021 10 - 37,950 3 5/10/2021 20,000 11/10/2021 5 - 20,000 4 6/29/2021 5,000 12/29/2021 5 - 5,000 Total $ 129,491 $ 200,705 |
NOTES PAYABLE RELATED PARTIES
NOTES PAYABLE RELATED PARTIES | 3 Months Ended |
Sep. 30, 2021 | |
NOTE 8. NOTES PAYABLE - RELATED PARTIES | NOTE 8. NOTES PAYABLE, RELATED PARTIES As of September 30 and June 30, 2021, the Company had $514,438 in outstanding notes payable, related parties. As of September 30 and June 30, 2021, the Company had $18,431 and $9,459, respectively, in accrued interest related to these notes. All of these notes were assumed in connection with the acquisition on March 25, 2021. Ref No. Date of Note Issuance Original Principal Balance Maturity Date Interest Rate % Principal Balance 9/30/21 Principal Balance 6/30/2020 1 3/25/2021 308,500 6/3/2021 10 308,500 308,500 2 3/25/2021 47,436 6/3/2021 10 47,435 47,435 3 3/25/2021 158,503 6/3/2021 10 158,503 158,503 Total $ 514,438 $ 514,438 |
CONVERTIBLE NOTES PAYABLE, IN D
CONVERTIBLE NOTES PAYABLE, IN DEFAULT | 3 Months Ended |
Sep. 30, 2021 | |
CONVERTIBLE NOTES PAYABLE, IN DEFAULT | |
NOTE 9. CONVERTIBLE NOTES PAYABLE, IN DEFAULT | NOTE 9. CONVERTIBLE NOTES PAYABLE, IN DEFAULT As of September 30 and June 30, 2021, the convertible notes payable were as follows: Date of Note Issuance Original Principal Balance Maturity Date Interest Rate % Conversion Rate Principal Balance 9/30/21 Principal Balance 6/30/21 8/26/14 $ 50,000 2/26/14 10 % $ 0.0001 $ 50,000 $ 50,000 6/15/12 8,000 12/15/12 10 % $ 0.000350 8,000 8,000 10/18/11 6,900 10/18/11 8 % 25% discount to market 6,900 6,900 10/3/10 20,000 10/3/12 10 % lesser $0.01 or 20% discount to market 20,000 20,000 10/31/09 4,000 10/31/10 8 % 25% discount to average of the previous 5 days closing price 4,000 4,000 8/31/09 5,000 8/31/12 12 % lesser $0.01 or 20% discount to market 5,000 5,000 8/26/09 20,000 8/26/12 12 % lesser $0.01 or 20% discount to market 20,000 20,000 8/25/09 20,000 8/25/12 12 % lesser $0.01 or 20% discount to market 20,000 20,000 2/26/07 30,000 2/26/09 12 % lesser $0.50 or 35% discount to market 30,000 30,000 4/17/07 20,000 4/17/09 10 % lesser $0.45 or 35% discount to market 20,000 20,000 6/14/07 15,000 6/15/09 10 % lesser $0.50 or 25% discount to market 15,000 15,000 1/29/07 15,000 1/29/09 10 % $ 0.95 15,000 15,000 4/17/07 15,000 4/17/09 10 % lesser $0.45 or 35% discount to market 15,000 15,000 12/23/06 18,000 12/23/08 10 % $ 0.95 18,000 18,000 11/30/06 50,000 11/30/08 10 % $ 0.85 50,000 50,000 9/16/06 100,000 9/9/08 12 % 35% discount to market 38,000 38,000 10/1/05 15,000 4/1/07 10 % $ 0.50 15,000 15,000 Total $ 349,900 $ 349,900 |
NOTES PAYABLE, LONG TERM
NOTES PAYABLE, LONG TERM | 3 Months Ended |
Sep. 30, 2021 | |
NOTES PAYABLE, LONG TERM | |
NOTE 10. NOTES PAYABLE, LONG TERM | NOTE 10. NOTES PAYABLE, LONG TERM PPP Loans The Company received loan proceeds in the amount of approximately $168,520 through Sarah Adult Days Services, Inc. and $270,640 through Sarah Day Care Centers, Inc. under the Paycheck Protection Program (“PPP”) prior to the March 25, 2021 acquisition. The PPP, established as part of the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”), provides for loans to qualifying businesses for amounts up to 2.5 times of the average monthly payroll expenses of the qualifying business. The loans and accrued interest are forgivable after twenty-four weeks as long as the borrower uses the loan proceeds for eligible purposes, including payroll, benefits, rent and utilities, and maintains its payroll levels. The amount of loan forgiveness will be reduced if the borrower terminates employees or reduces salaries during the period. The unforgiven portion of the PPP loan is payable over five years at an interest rate of 1%, with a deferral of payments for the first twelve months. The Company was granted forgiveness of $89,920 in PPP loans through Sarah Day Care Centers, Inc. and $82,600 through Sarah Adult Days Services, Inc. As a result, the Company recorded a gain on PPP forgiveness in the amount of $172,520, during the year ended June 30, 2021. The Company is currently in the process of applying for forgiveness for the remaining balance of $266,640 but cannot be assured of forgiveness for all or part of the PPP borrowings. During the quarter ended September 30, 2021, the Company recorded $665 in accrued interest related to the PPP loan. SBA Loan On June 20, 2020, the Company’s wholly-owned subsidiary, Sarah Day Care Centers, Inc. received proceeds of $150,000 in the form of an SBA loan. Installment payments, including principal and interest of $731 are due monthly beginning on June 20, 2021. The balance of principal and interest is payable thirty years from the promissory note date. The interest accrues at a rate of 3.75% per annum. During the quarter ended September 30, 2021, the Company recorded $1,402 in accrued interest related to the SBA loan. |
DERIVATIVE FINANCIAL INSTRUMENT
DERIVATIVE FINANCIAL INSTRUMENTS | 3 Months Ended |
Sep. 30, 2021 | |
DERIVATIVE FINANCIAL INSTRUMENTS | |
NOTE 11. DERIVATIVE FINANCIAL INSTRUMENTS | NOTE 11. DERIVATIVE FINANCIAL INSTRUMENTS The following tables summarize the components of the Company’s derivative liabilities and linked common shares as of September 30 and June 30, 2021 and the amounts that were reflected in income related to derivatives for the three months ended September 30, 2021 and 2020: September 30, 2021 Indexed Fair The financings giving rise to derivative financial instruments Shares Values Compound embedded derivative 894,914 $ (189,548 ) June 30, 2021 Indexed Fair The financings giving rise to derivative financial instruments Shares Values Compound embedded derivative 405,106 $ (254,700 ) The following tables summarizes the effects on the Company’s gain (loss) associated with changes in the fair values of the derivative financial instruments by type of financing for the quarters ended September 30, 2021 and 2020: The financings giving rise to derivative financial instruments and the income effects: Three Months Ended September 30, 2021 September 30, 2020 Compound embedded derivative $ 65,152 $ (129,228 ) Day one derivative loss - - Total derivative gain (loss) $ 65,152 $ (129,228 ) The Company’s Convertible Notes gave rise to derivative financial instruments. The Notes embodied certain terms and conditions that were not clearly and closely related to the host debt agreement in terms of economic risks and characteristics. These terms and features consist of the embedded conversion option. Current accounting principles that are provided in ASC 815 - Derivatives and Hedging Significant inputs and results arising from the Monte Carlo Simulations process are as follows for the compound embedded derivative that has been bifurcated from the Convertible Notes and classified in liabilities: September 30, September 30, Inception 2021 2020 Quoted market price on valuation date $ 0.01 $ 0.50 $ 0.0002 Contractual conversion rate $ 0.0054 - $0.0081 $ 0.325 - $0.80 $ 0.00010 - $0.00016 Range of effective contractual conversion rates - - - Contractual term to maturity 1.00 Year 0.25 Years 0.25 Years Market volatility: Volatility 138.28%-238.13 % 138.28%-238.13 % 138.28%-238.13 % Contractual interest rate 5%-12 % 5%-12 % 5%-12 % The following table reflects the issuances of compound embedded derivatives and changes in fair value inputs and assumptions related to the compound embedded derivatives during the periods ended September 30, 2021 and June 30, 2021. September 30, 2021 June 30, 2021 Beginning balance $ 254,700 $ 257,493 Issuances: Convertible Note Financing - - Removals - - Changes in fair value inputs and assumptions reflected (65,152 ) 223,264 Conversions - (226,057 ) Ending balance $ 189,548 $ 254,700 The fair value of the compound embedded derivative is significantly influenced by the Company’s trading market price, the price volatility in trading and the interest components of the Monte Carlo Simulation technique. |
STOCKHOLDERS EQUITY
STOCKHOLDERS EQUITY | 3 Months Ended |
Sep. 30, 2021 | |
STOCKHOLDERS EQUITY | |
NOTE 12. STOCKHOLDERS' EQUITY | NOTE 12. STOCKHOLDERS’ EQUITY On February 11, 2021, the Company filed with FINRA to effectuate a 10,000:1 reverse stock split. FINRA permitted this corporate actions on March 8, 2021. The 10,000:1 reverse split took effect at the open of business on March 9, 2021. Common Stock On February 19, 2021, pre-reverse stock split, the Company decreased its authorized shares to 500,000,000 shares of common stock, par value, $0.000001 per share, and 2,000,000 shares of Series A Convertible Preferred Stock, par value, $0.000001 per share. Each share of Series A Convertible Preferred Stock is convertible into 100 shares of the Company’s common stock. The Company no longer authorized any Series B Convertible Preferred Stock. On September 15, 2021 the Company issued 100,000 common stock, par value, $0.000001 per share, to a consultant for services rendered to the Company. Conversion of Notes Payable to Common Shares On December 31, 2020 (prior to the Company’s reverse split) the Company issued 1,050,000,000 common shares (which was the equivalent of 105,000 post-split common shares) for services rendered to the Company. On December 31, 2020 five (5) Noteholders, including the Company’s Board of Director Members, converted a total of $1,965,460 of convertible promissory notes into 40,702,104,817 common shares of the Company, pre-reverse stock split. On December 31, 2020, the Company’s two Board of Director Members converted a total of $1,644,825 of convertible promissory notes into a total of 34,267,187,500 common shares. The Company’s Board of Director Members control approximately 87.32% of the voting rights of the Company. The 3 (three) Noteholders converted a total of $325,666 of convertible promissory notes into a total of 6,439,917,317 common shares, pre-reverse stock split. On February 2, 2021 eleven (11) Noteholders converted a total of $833,790 of convertible promissory notes into 14,586,720,714 common shares of the Company, pre-reverse stock split. On March 19, 2021 the Company’s Board of Directors converted all 47,400,000 of their Series A Preferred Stock into 474,000 shares of Common Stock. There was no Series A Preferred Stock outstanding after these conversions, until March 25, 2021, when the Company issued 317,500 shares of Series A Preferred Stock to 7 investors as part of their $1,602,097 cash investment for Series A Preferred Stock, pre-reverse stock split. Series A Preferred Stock & Series B Preferred Stock On December 21, 2020, the Company increased its authorized shares to 1 Trillion shares of common stock, par value, $0.000001 per share, and 5 Billion shares of Series A Preferred Stock, par value, $0.000001 per share, and 5 Billion Shares of Series B Preferred Stock, par value, $0.000001 per share. Each share of Series A and Series B Preferred Stock is convertible into 100 shares of the Company’s common stock, pre-reverse stock split. On December 21, 2020, the Company increased its authorized Preferred Series A and Series B shares to 5 Billion shares of Series A Preferred Stock, par value, $0.000001 per share, and 5 Billion Shares of Series B Preferred Stock, par value, $0.000001 per share (together the “Preferred Stock”), pre-reverse stock split. Series A Preferred Stock & Series B Preferred Stock – Certificate of Designations The Preferred Shares each have Certificate of Designations, which designate as follows: Number 100,000 shares of the Parent Company’s Preferred Stock are designated as shares of Series A Convertible Preferred Stock, par value $0.000001 per share. 100,000 shares of the Parent Company’s Preferred Stock are designated as shares of Series B Convertible Preferred Stock, par value $0.000001 per share. Dividends Any dividends (other than dividends on common stock payable solely in common stock or dividends on the Series A Convertible Preferred Stock payable solely in Series A Convertible Preferred Stock or dividends on the Series B Preferred Convertible Stock payable solely in Series B Convertible Preferred Stock) declared or paid in any fiscal year will be declared or paid among the holders of the Series A Convertible Preferred Stock, Series B Convertible Preferred Stock and common stock then outstanding in proportion to the greatest whole number of shares of common stock which would be held by each such holder if all shares of Series A Preferred Stock and Series B Convertible Preferred Stock were converted into shares of common stock pursuant to the terms of the Certificate of Designations. The Parent Company’s Board of Directors is under no obligation to declare dividends on the Series A Convertible Preferred Stock or Series B Convertible Preferred Stock. Conversion Each share of Preferred Stock is convertible into 100 shares of the Parent Company’s common stock (the “ Conversion Rate Liquidation In the event of any liquidation, dissolution or winding up of the Parent Company, the assets of the Parent Company legally available for distribution by the Parent Company would be distributed with equal priority and pro rata among the holders of the Preferred Stock and common stock in proportion to the number of shares of common stock held by them, with the shares of Preferred Stock being treated for this purpose as if they had been converted to shares of common stock at the then applicable Conversion Rate. Voting On any matter presented to the stockholders of the Parent Company for their action or consideration at any meeting of stockholders of the Parent Company (or by written consent of stockholders in lieu of meeting), each holder of outstanding shares of Preferred Stock would be entitled to cast the number of votes equal to the number of whole shares of common stock into which the shares of Preferred Stock held by such holder are convertible as of the record date for determining stockholders entitled to vote on such matter. Except as provided by law or by the other provisions of the Parent Company’s Certificate of Incorporation, holders of Preferred Stock vote together with the holders of common stock as a single class. |
PROVISION FOR CORPORATE INCOME
PROVISION FOR CORPORATE INCOME TAXES | 3 Months Ended |
Sep. 30, 2021 | |
PROVISION FOR CORPORATE INCOME TAXES | |
NOTE 13. PROVISION FOR CORPORATE INCOME TAXES | NOTE 13. PROVISION FOR CORPORATE INCOME TAXES The Company provides for income taxes by the use of an asset and liability approach in accounting for income taxes. Deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax bases of assets and liabilities and the tax rates in effect when these differences are expected to reverse. This also requires the reduction of deferred tax assets by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. The valuation allowance at September 30, 2021 was $2,846,527 and as of June 30, 2021 was $2,792,070. The net change in allowance during the quarter ended September 30, 2021 was $54,457. As of September 30, 2021, the Company has federal net operating loss carry forwards of approximately $13,555,000 available to offset future taxable income through 2040. The Company may be able to utilize its NOLs to reduce future federal and state income tax liabilities. However, these NOLs are subject to various limitations under Internal Revenue Code (“IRC”) Section 382. IRC Section 382 limits the use of NOLs to the extent there has been an ownership change of more than 50 percentage points. In addition, the NOL carry-forwards are subject to examination by the taxing authority and could be adjusted or disallowed due to such exams. Although the Company has not undergone an IRC Section 382 analysis, it is possible that the utilization of the NOLs could be substantially limited. The Company has no tax provision for the quarters ended September 30, 2021 and 2020 due to losses and full valuation allowances against net deferred tax assets. As of September 30 and June 30, 2021, the difference between the tax provision at the statutory federal income tax rate and the tax provision attributable to loss before income taxes is as follows (in percentages): Statutory federal income tax rate (21 )% State taxes – net of federal benefits (5 )% Valuation allowance 26 % Income tax rate – net 0 % FASB Interpretation No. 48 (Fin 48) - Accounting for Uncertain Tax Positions The Company files income tax returns in the U.S. federal jurisdiction and various state, and local jurisdictions. The Company is no longer subject to U.S. federal income tax examination by tax authorities, with limited exception, for the years prior to June 30, 2014. With respect to state and local jurisdictions, with limited exception, the Company is no longer subject to income tax audits prior to June 30, 2014. In the normal course of business, the Company is subject to examination by various taxing authorities. Although the outcome of tax audits is always uncertain, the Company believes that adequate amounts of tax, interest and penalties have been provided for any adjustments that may result from these open tax years. Based on management’s review of the Company’s tax position, the Company had no significant unrecognized corporate tax liabilities as of September 30 and June 30, 2021 payable to the Internal Revenue Service due to the net operating loss carry-forward, however, the Company had yet to file its 2005 through 2009 and 2012 through 2020 Federal, New Jersey nor New York Corporate Income Tax Returns. |
UNPAID PAYROLL TAXES
UNPAID PAYROLL TAXES | 3 Months Ended |
Sep. 30, 2021 | |
UNPAID PAYROLL TAXES | |
NOTE 14. UNPAID PAYROLL TAXES | NOTE 14. UNPAID PAYROLL TAXES As of September 30 and June 30, 2021, the Company owed the Internal Revenue Service and New York State payroll related taxes in the amounts of $60,402 and $17,401, respectively, subject to further interest and penalties. The total amount due to both taxing authorities including penalties and interest as of September 30 and June 30, 2021 was approximately $77,803 subject to further penalties and interest. This is included in accounts payable and accrued expenses on the Company’s consolidated balance sheets. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Sep. 30, 2021 | |
COMMITMENTS AND CONTINGENCIES | |
NOTE 15. COMMITMENTS AND CONTINGENCIES | NOTE 15. COMMITMENTS AND CONTINGENCIES Rent As of September 30, 2021, the Company maintains its corporate address in at 2310 York Street, Suite 200, Blue Island, IL, 60406. This space is provided by the Company’s Chairman, Charles Everhardt, a related party, on a rent free basis at the present time. The Company does not currently have a lease for this space at this time but expects to enter into a month-to-month office lease for this space. SarahCare leases three properties for its corporate office and its two corporate owned centers. SarahCare’s corporate office is approximately 3,470 square feet and is located at 4580 Stephen Circle NW, Canton, Ohio, 44718. The lease began in 2017 and ends in 2023. SarahCare’s lease for its first corporate-owned SarahCare location is for approximately 5,300 square feet located at 6199 Frank Ave. NW, North Canton, Ohio, 44720. The lease began in 2018 and ends in 2026. SarahCare’s lease for its second corporate-owned SarahCare location is for approximately 6,000 square feet located at SarahCare of Stow, 4472 Darrow Road, Stow, Ohio, 44224. The lease began in 2018 and ends in 2026. On April 21, 2021, the Company, through ten newly-formed, wholly-owned limited liability companies, entered into lease agreements with entities controlled by our Chairman, Charles Everhardt, for ten additional SarahCare locations to be operated by the Company. All of the leases are for a ten-year period beginning on July 1, 2021, and ending on June 30, 2031, with a 5-year renewal option. The rent for each location is $7,500 per month. As of June 30, 2021, the Company has amended the leases to delay commencement until November 1, 2021. IRS Tax Lien The Internal Revenue Service has placed a federal tax lien on all of the assets of the Company. |
LEASES
LEASES | 3 Months Ended |
Sep. 30, 2021 | |
LEASES | |
NOTE 16. LEASES | NOTE 16. LEASES Stow Professional Lease In connection with the acquisition of Sarah Adult Day Centers, Inc. on March 25, 2021, the Company acquired a facilities lease with 6,000 square feet at 4472 Darrow Road, Stow, Ohio 44224. The lease expires on September 30, 2025 and the lease payments are as follows: Monthly Rent Payments Base Rent Covid-19 Recoup* Total Rent April 1, 2021 $ 6,369 $ 983 $ 7,352 May 1, 2021 to December 31, 2021 $ 6,369 $ 621 $ 6,990 January 1, 2022 to December 31, 2022 $ 6,433 $ 621 $ 7,054 January 1, 2023 to December 31, 2023 $ 6,497 $ 621 $ 7,118 January 1, 2024 to December 31, 2024 $ 6,562 $ 621 $ 7,183 January 1, 2025 to September 30, 2025 $ 6,628 $ 621 $ 7,249 *The Company has to repay the lessor monthly payments as a result of COVID relief. Harbor Lease In connection with the acquisition of Sarah Adult Day Centers, Inc. on March 25, 2021, the Company acquired a facilities lease with 3,469 square feet at 4580 Stephen Circle NW. Canton, OH 44718. The monthly lease payments are $4,500 and the lease expires on September 30, 2023. S. Frank Professional Lease In connection with the acquisition of Sarah Day Care Centers, Inc. on March 25, 2021, the Company acquired a facilities lease with 5,300 square feet in Jackson, Ohio. The monthly lease payments are $7,910, which includes monthly payments of $603 as repayments for COVID relief. The lease expires on July 1, 2026. Operating lease right-of-use asset and liability are recognized at the present value of the future lease payments at the lease commencement date. The interest rate used to determine the present value is our incremental borrowing rate, estimated to be 10%, as the interest rate implicit in most of the Company’s leases is not readily determinable. Operating lease expense is recognized on a straight-line basis over the lease term. Since the common area maintenance expenses are expenses that do not depend on an index or rate, they are excluded from the measurement of the lease liability and recognized in general and administrative expenses on the consolidated statements of operations. Right-of-use asset is summarized below: September 30, 2021 Stow Professional Center Lease Harbor Lease S. Frank Professional Lease Total Office lease $ 282,371 $ 120,003 $ 412,770 $ 815,144 Less: accumulated amortization (29,500 ) (21,672 ) (47,103 ) (98,275 ) Right-of-use asset, net $ 252,871 $ 98,331 $ 365,667 $ 716,869 Operating lease liability is summarized below: September 30, 2021 Stow Professional Center Lease Harbor Lease S. Frank Professional Lease Total Office lease $ 253,228 $ 98,332 $ 365,669 $ 717,229 Less: current portion (62,642 ) (46,720 ) (61,935 ) (171,297 ) Long term portion $ 190,586 $ 51,612 $ 303,734 $ 545,932 Maturity of the lease liability is as follows: September 30, 2021 Stow Professional Center Lease Harbor Lease S. Frank Professional Lease Total Year ending June 30, 2022 $ 63,288 $ 40,500 $ 71,195 $ 174,983 Year ending June 30, 2023 85,025 54,000 94,923 233,948 Year ending June 30, 2024 85,802 13,501 94,923 194,226 Year ending June 30, 2025 64,841 - 94,923 159,764 Year ending June 30, 2026 - - 94,923 94,923 Year ending June 30, 2027 - - 7,913 7,913 Present value discount (45,728 ) (9,669 ) (93,131 ) (148,528 ) Lease liability $ 253,228 $ 98,332 $ 365,669 $ 717,229 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Sep. 30, 2021 | |
RELATED PARTY TRANSACTIONS | |
NOTE 17. RELATED PARTY TRANSACTIONS | NOTE 17. RELATED PARTY TRANSACTIONS During the quarters ended September 30, 2021 and 2020, there were no certain relationships nor related party transaction, except for the following: As of September 30, 2021, the Company maintains its corporate address in at 2310 York Street, Suite 200, Blue Island, IL, 60406. This space is provided by the Company’s Chairman, Charles Everhardt, a related party, on a rent free basis at the present time. The Company does not currently have a lease for this space at this time but expects to enter into a month-to-month office lease for this space. On September 28, 2021, the Company signed a note receivable of $50,000 from a company founded and partially owned by the Company’s Chairman, Charles Everhardt. On September 8, 2021 the Company signed a note receivable of $29,294 from a company founded and partially owned by the Company’s Chairman, Charles Everhardt. On April 21, 2021, the Company, through ten newly-formed, wholly-owned limited liability companies, entered into lease agreements with entities controlled by our Chairman, Charles Everhardt, for ten additional SarahCare locations to be operated by the Company. All of the leases are for a ten-year period beginning on July 1, 2021, and ending on June 30, 2031, with a 5-year renewal option. The rent for each location is $7,500 per month. In July 2021, the Company has amended the leases to delay commencement until November 1, 2021. On March 25, 2021, the Company issued 2,476,212 shares of restricted common stock in exchange for $250,000 which were issued at $0.0503 per share and the Company issued 100,542 shares of Series A Preferred Stock in exchange for $508,834, which were issued at $5.06 per share, to an investor, the son of Charles Everhardt, the Company’s Chairman. Additionally, Mr. Everhardt owns 50% of DE Holdings 20, LLC which converted $114,244 in convertible notes and accrued interest for 114,244 shares of restricted common shares, at a price of $1.00 per share. On that same day, Mr. Everhardt became Chairman of the Board of the Company. On March 19, 2021, the Company issued 426,000 shares of restricted common stock to the Company’s then CEO and Chairman, Michael J Friedman, for the conversion 42,600,000 shares of Series A Convertible Preferred Stock. On March 19, 2021, the Company issued 48,000 shares of restricted common stock to Jay Odintz, a Member of the Company’s Board of Directors, for the conversion 4,800,000 shares of Series A Convertible Preferred Stock. On December 30, 2020, the Company issued 29,749,125,000 shares of restricted common stock for the conversion of notes payable in the amount of $1,427,958, to the Company’s then CEO and Chairman, Michael J. Friedman. These shares were valued by the Company at $0.000048 per share, pre-reverse stock split. On December 30, 2020, the Company issued 4,518,062,500 shares of restricted common stock for the conversion of notes payable in the amount of $216,867, to a Board of Director Member, Jay Odintz. These shares were valued by the Company at $0.000048 per share, pre-reverse stock split. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Sep. 30, 2021 | |
SUBSEQUENT EVENTS | |
NOTE 18. SUBSEQUENT EVENTS | NOTE 18. SUBSEQUENT EVENTS The Company has evaluated subsequent events for recognition and disclosure through November 22, 2021, the date the financial statements were available to be issued, and determined that there were no such events requiring adjustment to, or disclosure in, the accompanying consolidated financial statements except as described below. On April 21, 2021, the Company, through ten newly-formed, wholly-owned limited liability companies, entered into lease agreements with entities controlled by our Chairman, Charles Everhardt, for ten additional SarahCare locations to be operated by the Company. All of the leases are for a ten-year period beginning on July 1, 2021, and ending on June 30, 2031, with a 5-year renewal option. The rent for each location is $7,500 per month. As of June 30, 2021, the Company has amended the leases to delay commencement until November 1, 2021. On October 29, 2021 the Company amended the leases to delay commencement until May 1, 2022. The newly formed entities have no other activity aside from the lease activity described above. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Sep. 30, 2021 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Participant Fees | Resident fee revenue is reported at the amount that reflects the consideration the Company expects to receive in exchange for the services provided. These amounts are due from participants or third-party payors and include variable consideration for retroactive adjustments from estimated reimbursements, if any, under reimbursement programs. Performance obligations are determined based on the nature of the services provided. Resident fee revenue is recognized as performance obligations are satisfied. Under the Company’s day care agreements, which are generally for a contractual term of 30 days to one year, the Company provides services to participants for a stated daily or monthly fee. The Company has elected the lessor practical expedient within ASC 842, Leases Revenue Recognition from Contracts with Customers The Company enters into contracts to provide home assisted health, and certain outpatient services. Each service provided under the contract is capable of being distinct, and thus, the services are considered individual and separate performance obligations. The performance obligations are satisfied as services are provided and revenue is recognized as services are provided. The Company receives payment for services under various third-party payor programs which include Medicaid, Veterans Affairs and other third-party payors. Estimates for settlements with third-party payors for retroactive adjustments from estimated reimbursements due to audits, reviews, or investigations are included in the determination of the estimated transaction price for providing services. The Company estimates the transaction price based on the terms of the contract with the payor, correspondence with the payor, and historical payment trends. Changes to these estimates for retroactive adjustments are recognized in the period the change or adjustment becomes known or when final settlements are determined. Billings for services under third-party payor programs are recorded net of estimated retroactive adjustments, if any. Retroactive adjustments are accrued on an estimated basis in the period the related services are rendered and adjusted in future periods or as final settlements are determined. Contractual or cost related adjustments from Medicaid or Veterans Affairs are accrued when assessed (without regard to when the assessment is paid or withheld). Subsequent adjustments to these accrued amounts are recorded in net revenues when known. |
Basis of Presentation | The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) and reflect all adjustments, consisting of normal recurring adjustments, which management believes are necessary to fairly present the financial position, results of operations and cash flows of the Company as of and for the quarters ended September 30, 2021 and 2020. |
Principles of Consolidation | The Company has two wholly-owned operating subsidiaries; Sarah Adult Day Services, Inc., and Sarah Day Care Centers, Inc. The consolidated financial statements, which include the accounts of the Company and its two wholly-owned operating subsidiaries, are prepared in conformity GAAP. All significant intercompany balances and transactions have been eliminated. The consolidated financial statements, which include the accounts of the Company and its wholly-owned operating subsidiaries, and related disclosures have been prepared pursuant to the rules and regulations of the SEC. The consolidated financial statements have been prepared using the accrual basis of accounting in accordance with GAAP and presented in US dollars. The fiscal year end is June 30. |
Use of Estimates | The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported revenues and expenses during the reporting periods. Because of the use of estimates inherent in the financial reporting process, actual results may differ significantly from those estimates. |
Cash And Cash Equivalents | The Company maintains cash balances in a non-interest-bearing account that currently does not exceed $250,000 at September 30, 2021. For the purpose of the consolidated statements, all highly liquid investments with a maturity of three months or less are considered to be cash equivalents. There were no cash equivalents as of September 30, 2021 and 2020. |
Earnings Per Share Calculation | Basic earnings per common share (“EPS”) is computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted earnings per share is computed by dividing net income by the weighted average shares outstanding, assuming all dilutive potential common shares were issued. |
Revenue Recognition | Revenue is recognized when a customer obtains control of promised goods or services. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for those goods. The Company applies the following five-step model in order to determine this amount: (i) identification of the promised goods in the contract; (ii) determination of whether the promised goods are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. Once a contract is determined to be within the scope of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606 at contract inception, the Company reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. |
Income Taxes | The provision for income taxes is the total of the current taxes payable and the net of the change in the deferred income taxes. Provision is made for the deferred income taxes where differences exist between the period in which transactions affect current taxable income and the period in which they enter into the determination of net income in the financial statements. |
Leases | On December 1, 2018, the Company adopted ASU 2016-02, “ Leases |
Fair Value of Financial Instruments | The Company’s financial instruments include cash and cash equivalents, accounts payable, accrued expenses, and debt. The carrying value of these financial instruments is considered to be representative of their fair value due to the short maturity of these instruments. The carrying amount of the debt approximates fair value, because the interest rates on these instruments approximate the interest rate on debt with similar terms available to the Company. The Company’s derivative liabilities were adjusted to fair market value at the end of each reporting period, using Level 3 inputs. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability, in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The fair value hierarchy is based on three levels of inputs, of which the first two are considered observable and the last unobservable, as follows: Level 1 – Quoted prices in active markets for identical assets or liabilities. Level 2 – Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the measurement of the fair value of the assets or liabilities. The carrying amounts of the Company’s financial assets and liabilities, such as cash, accounts payable, accrued expenses and interest, certain notes payable and notes payable – due to related parties, approximate their fair values because of the short maturity of these instruments. The Company accounts for its derivative liabilities, at fair value, on a recurring basis under Level 3 (See Note 11). |
Embedded Conversion Features | The Company evaluates embedded conversion features within convertible debt under ASC 815 “ Derivatives and Hedging Debt with Conversion and Other Options |
Derivative financial instruments | When the Company issues debt that contains a conversion feature, it first evaluates whether the conversion feature meets the requirements to be treated as a derivative: a) one or more underlying, typically the price of the Company’s stock; b) one or more notional amounts or payment provisions or both, generally the number of shares upon conversion; c) no initial net investment, which typically excludes the amount borrowed; and d) net settlement provisions, which in the case of convertible debt generally means the stock received upon conversion can be readily sold for cash. There are certain scope exceptions from derivative treatment, but these typically exclude conversion features that provide for a variable number of shares. If the conversion features within convertible debt meet the requirements to be treated as a derivative, the Company estimates the fair value of the derivative liability using the Monte Carlo Simulation Model upon the date of issuance. If the fair value of the derivative liability is higher than the face value of the convertible debt, the excess is immediately recognized as interest expense. Otherwise, the fair value of the derivative liability is recorded as a liability with an offsetting amount recorded as a debt discount, which offsets the carrying amount of the debt. The derivative liability is revalued at the end of each reporting period and any change in fair value is recorded as a change in fair value in the consolidated statements of operations. The debt discount is amortized through interest expense over the life of the debt. Derivative instrument liabilities and the host debt agreement are classified on the consolidated balance sheets as current or non-current based on whether settlement of the derivative instrument could be required within twelve months of the balance sheet date. The accounting treatment of derivative financial instruments requires that the Company record the embedded conversion option at their fair values as of the inception date of the agreement and at fair value as of each subsequent balance sheet date. Any change in fair value is recorded as non-operating, non-cash income or expense for each reporting period at each balance sheet date. The Company reassesses the classification of its derivative instruments at each balance sheet date. If the classification changes as a result of events during the period, the contract is reclassified as of the date of the event that caused the reclassification. As a result of entering into warrant agreements, for which such instruments contained a variable conversion feature with no floor, the Company has adopted a sequencing policy in accordance with ASC 815-40-35-12 “ Derivatives and Hedging |
Debt Issue Costs and Debt Discount | The Company may record debt issue costs and/or debt discounts in connection with raising funds through the issuance of debt. These costs may be paid in the form of cash, or equity (such as warrants). These costs are amortized to interest expense over the life of the debt. If a conversion of the underlying debt occurs, a proportionate share of the unamortized amounts is immediately expensed. |
Recently Issued Accounting Pronouncements | As of and for the quarter ended September 30, 2021, the Company does not expect any of the recently issued accounting pronouncements to have a material impact on its financial condition or results of operations. |
Subsequent Events | In accordance with ASC 855, Subsequent Events |
Franchise Fees | The Company franchises a number of its locations under franchise contracts which provide periodic franchise fee payments to the Company and reimbursement for costs and expense related to such franchises. The Company’s franchisees pay a variety of royalties and fees, including an agreed upon percentage of gross revenues (as defined in the franchise agreement). The Company estimates the amount of franchise fee revenue expected to be earned, if any, during the annual contract period and revenue is recognized as services are provided. The Company’s estimate of the transaction price for the franchise services also includes the amount of reimbursement due from the franchises for services provided and related costs incurred. Such revenue is included in “revenues” on the consolidated statements of operations. The related costs are included in “operating expenses” on the consolidated statements of operations. |
BUSINESS ACQUISITION (Tables)
BUSINESS ACQUISITION (Tables) | 3 Months Ended |
Sep. 30, 2021 | |
BUSINESS ACQUISITION | |
Schedule of fair Value Of assets (liability) Acquired | Consideration Cash $ 2,000,110 Legal fees (175,162 ) Notes payable due to sellers 393,885 Royalty fee liability 1,500,000 Total consideration $ 3,718,833 Fair value of net identifiable assets (liabilities) acquired Cash $ 412,276 Accounts receivable 84,674 Deposits and prepaid expenses 15,139 Notes receivable 110,510 Property, plant and equipment 335,426 Right of use asset 796,771 Total fair value of net identifiable assets $ 1,754,796 Accounts payable and accrued expenses $ 625,462 Notes payable, current, net of debt discount 454,524 PPP Loan 439,160 Lease Liability 796,771 Total fair value of net identifiable liabilities $ 2,315,917 Fair value of net identifiable assets (liabilities) acquired $ (561,121 ) Goodwill $ 4,279,954 |
Schedule of company's result of operation | 2021 Net revenue $ 677,997 Net loss $ (3,513,187 ) Net loss per share- basic and diluted $ (0.60 ) Weighted average number of shares of common stock outstanding- basic and diluted 2,117,130 |
NOTES RECEIVABLE (Tables)
NOTES RECEIVABLE (Tables) | 3 Months Ended |
Sep. 30, 2021 | |
NOTES RECEIVABLE (Tables) | |
Schedule of notes receivable | September 30, June 30, 2021 2021 Notes receivable from a franchise, due in monthly installments of $5,000, no interest, maturing December 2021 $ 11,468 $ 21,468 Notes receivable from a franchise, due in monthly installments of $1,999, no interest, maturing March 2023 35,987 41,985 Note receivable from related party (see Note 17), due in six months, with no installments, 5% interest maturing March 2022 79,294 - Total notes receivable 126,749 63,453 Less long-term (14,466 ) (14,466 ) Total short term notes receivable $ 112,283 $ 48,987 |
Schedule Of Principal collected | 2022 $ 112,283 2023 14,466 $ 126,749 |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Table) | 3 Months Ended |
Sep. 30, 2021 | |
PROPERTY, PLANT AND EQUIPMENT | |
Schedule of Property Plant And Equipment | September 30, 2021 June 30, 2021 Leasehold improvements $ 294,864 $ 294,864 Vehicles 22,554 22,554 Computer equipment 12,553 12,553 Furniture and fixtures 5,455 5,455 335,426 335,426 Less: Accumulated depreciation (23,347 ) (9,638 ) Property, plant and equipment - net $ 312,079 $ 325,788 |
NOTES PAYABLE (Tables)
NOTES PAYABLE (Tables) | 3 Months Ended |
Sep. 30, 2021 | |
NOTES PAYABLE | |
Schedule of Notes Payable | Ref No. Date of Note Issuance Original Principal Balance Maturity Date Interest Rate % Principal Balance 9/30/21 Principal Balance 6/30/2020 1 12/25/2020 $ 146,021 12/15/2020 10 $ 129,491 $ 137,755 2 3/25/2021 37,949 6/3/2021 10 - 37,950 3 5/10/2021 20,000 11/10/2021 5 - 20,000 4 6/29/2021 5,000 12/29/2021 5 - 5,000 Total $ 129,491 $ 200,705 |
NOTES PAYABLE, RELATED PARTIES
NOTES PAYABLE, RELATED PARTIES (Tables) | 3 Months Ended |
Sep. 30, 2021 | |
UNPAID PAYROLL TAXES | |
Schedule of notes payable of related party | Ref No. Date of Note Issuance Original Principal Balance Maturity Date Interest Rate % Principal Balance 9/30/21 Principal Balance 6/30/2020 1 3/25/2021 308,500 6/3/2021 10 308,500 308,500 2 3/25/2021 47,436 6/3/2021 10 47,435 47,435 3 3/25/2021 158,503 6/3/2021 10 158,503 158,503 Total $ 514,438 $ 514,438 |
CONVERTIBLE NOTES PAYABLE, IN_2
CONVERTIBLE NOTES PAYABLE, IN DEFAULT (Tables) | 3 Months Ended |
Sep. 30, 2021 | |
CONVERTIBLE NOTES PAYABLE, IN DEFAULT | |
Schedule of convertible notes payable, in defaults | Date of Note Issuance Original Principal Balance Maturity Date Interest Rate % Conversion Rate Principal Balance 9/30/21 Principal Balance 6/30/21 8/26/14 $ 50,000 2/26/14 10 % $ 0.0001 $ 50,000 $ 50,000 6/15/12 8,000 12/15/12 10 % $ 0.000350 8,000 8,000 10/18/11 6,900 10/18/11 8 % 25% discount to market 6,900 6,900 10/3/10 20,000 10/3/12 10 % lesser $0.01 or 20% discount to market 20,000 20,000 10/31/09 4,000 10/31/10 8 % 25% discount to average of the previous 5 days closing price 4,000 4,000 8/31/09 5,000 8/31/12 12 % lesser $0.01 or 20% discount to market 5,000 5,000 8/26/09 20,000 8/26/12 12 % lesser $0.01 or 20% discount to market 20,000 20,000 8/25/09 20,000 8/25/12 12 % lesser $0.01 or 20% discount to market 20,000 20,000 2/26/07 30,000 2/26/09 12 % lesser $0.50 or 35% discount to market 30,000 30,000 4/17/07 20,000 4/17/09 10 % lesser $0.45 or 35% discount to market 20,000 20,000 6/14/07 15,000 6/15/09 10 % lesser $0.50 or 25% discount to market 15,000 15,000 1/29/07 15,000 1/29/09 10 % $ 0.95 15,000 15,000 4/17/07 15,000 4/17/09 10 % lesser $0.45 or 35% discount to market 15,000 15,000 12/23/06 18,000 12/23/08 10 % $ 0.95 18,000 18,000 11/30/06 50,000 11/30/08 10 % $ 0.85 50,000 50,000 9/16/06 100,000 9/9/08 12 % 35% discount to market 38,000 38,000 10/1/05 15,000 4/1/07 10 % $ 0.50 15,000 15,000 Total $ 349,900 $ 349,900 |
DERIVATIVE FINANCIAL INSTRUME_2
DERIVATIVE FINANCIAL INSTRUMENTS (Tables) | 3 Months Ended |
Sep. 30, 2021 | |
DERIVATIVE FINANCIAL INSTRUMENTS | |
Schedule of compound embedded derivatives | September 30, 2021 June 30, 2021 Beginning balance $ 254,700 $ 257,493 Issuances: Convertible Note Financing - - Removals - - Changes in fair value inputs and assumptions reflected (65,152 ) 223,264 Conversions - (226,057 ) Ending balance $ 189,548 $ 254,700 |
Schedule of derivative financial instruments | September 30, 2021 Indexed Fair The financings giving rise to derivative financial instruments Shares Values Compound embedded derivative 894,914 $ (189,548 ) June 30, 2021 Indexed Fair The financings giving rise to derivative financial instruments Shares Values Compound embedded derivative 405,106 $ (254,700 ) |
Schedule of Fair value derivative liabilities | Three Months Ended September 30, 2021 September 30, 2020 Compound embedded derivative $ 65,152 $ (129,228 ) Day one derivative loss - - Total derivative gain (loss) $ 65,152 $ (129,228 ) |
Schedule of Convertible Notes | September 30, September 30, Inception 2021 2020 Quoted market price on valuation date $ 0.01 $ 0.50 $ 0.0002 Contractual conversion rate $ 0.0054 - $0.0081 $ 0.325 - $0.80 $ 0.00010 - $0.00016 Range of effective contractual conversion rates - - - Contractual term to maturity 1.00 Year 0.25 Years 0.25 Years Market volatility: Volatility 138.28%-238.13 % 138.28%-238.13 % 138.28%-238.13 % Contractual interest rate 5%-12 % 5%-12 % 5%-12 % |
PROVISION FOR CORPORATE INCOM_2
PROVISION FOR CORPORATE INCOME TAXES (Tables) | 3 Months Ended |
Sep. 30, 2021 | |
PROVISION FOR CORPORATE INCOME TAXES | |
Schedule of statutory federal income tax rate | Statutory federal income tax rate (21 )% State taxes – net of federal benefits (5 )% Valuation allowance 26 % Income tax rate – net 0 % |
LEASES (Tables)
LEASES (Tables) | 3 Months Ended |
Sep. 30, 2021 | |
LEASES (Tables) | |
Schedule of monthly lease payment | Monthly Rent Payments Base Rent Covid-19 Recoup* Total Rent April 1, 2021 $ 6,369 $ 983 $ 7,352 May 1, 2021 to December 31, 2021 $ 6,369 $ 621 $ 6,990 January 1, 2022 to December 31, 2022 $ 6,433 $ 621 $ 7,054 January 1, 2023 to December 31, 2023 $ 6,497 $ 621 $ 7,118 January 1, 2024 to December 31, 2024 $ 6,562 $ 621 $ 7,183 January 1, 2025 to September 30, 2025 $ 6,628 $ 621 $ 7,249 |
schedule of Right of use asset | September 30, 2021 Stow Professional Center Lease Harbor Lease S. Frank Professional Lease Total Office lease $ 282,371 $ 120,003 $ 412,770 $ 815,144 Less: accumulated amortization (29,500 ) (21,672 ) (47,103 ) (98,275 ) Right-of-use asset, net $ 252,871 $ 98,331 $ 365,667 $ 716,869 |
Schedule of Operating lease liability | September 30, 2021 Stow Professional Center Lease Harbor Lease S. Frank Professional Lease Total Office lease $ 253,228 $ 98,332 $ 365,669 $ 717,229 Less: current portion (62,642 ) (46,720 ) (61,935 ) (171,297 ) Long term portion $ 190,586 $ 51,612 $ 303,734 $ 545,932 |
Schedule Of Maturity of the lease liability | September 30, 2021 Stow Professional Center Lease Harbor Lease S. Frank Professional Lease Total Year ending June 30, 2022 $ 63,288 $ 40,500 $ 71,195 $ 174,983 Year ending June 30, 2023 85,025 54,000 94,923 233,948 Year ending June 30, 2024 85,802 13,501 94,923 194,226 Year ending June 30, 2025 64,841 - 94,923 159,764 Year ending June 30, 2026 - - 94,923 94,923 Year ending June 30, 2027 - - 7,913 7,913 Present value discount (45,728 ) (9,669 ) (93,131 ) (148,528 ) Lease liability $ 253,228 $ 98,332 $ 365,669 $ 717,229 |
GENERAL ORGANIZATION AND BUSI_2
GENERAL ORGANIZATION AND BUSINESS (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | |
Mar. 25, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | |
Ownership percentage | 84.11% | ||
Ownership percentage on diluted basis | 83.00% | ||
Accumulated deficit | $ (15,175,330) | $ (14,916,012) | |
Royalty liability | 1,500,000 | 1,500,000 | |
Investment received | $ 2,000,000 | ||
Cash | $ 106,825 | $ 433,435 | |
Reverse stock split | On February 1, 2021, the Company filed all required Form 10-Q’s and 10-K’s to be up to date with its filings before filing its Form 15-12G on November 7, 2014. On February 11, 2021, the Company filed with FINRA to effectuate a 10,000:1 reverse stock split, change its name from Fresh Harvest Products, Inc. to Innovative MedTech, Inc. and change its stock symbol from ‘FRHV’ to ‘IMTH’. FINRA permitted these corporate actions on March 8, 2021. The 10,000:1 reverse split and the name change from Fresh Harvest Products, Inc., to Innovative MedTech, Inc. corporate actions took effect at the open of business on March 9, 2021. | ||
Cash acquired in business combination | 3,718,833 | ||
Purchase of subsidiary | 2,000,110 | ||
Sarah Day Care Centers, Inc. [Member] | |||
Purchase of subsidiary | 2,000,110 | ||
Sarah Adult Day Services, Inc [Member] | |||
Cash acquired in business combination | $ 3,718,833 |
LIQUIDITY CAPITAL RESOURCES AND
LIQUIDITY CAPITAL RESOURCES AND GOING CONCERN (Details Narrative) - USD ($) | 3 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Jun. 30, 2021 | |
LIQUIDITY, CAPITAL RESOURCES AND GOING CONCERN | |||
Total liabilities | $ 5,173,938 | $ 5,299,329 | |
Accumulated deficit | (15,175,330) | (14,916,012) | |
Total assets | 4,934,175 | $ 5,243,884 | |
Net Loss | $ (259,318) | $ (230,462) |
BUSINESS ACQUISITION (Details)
BUSINESS ACQUISITION (Details) - USD ($) | Sep. 30, 2021 | Jun. 30, 2021 |
Accounts receivable | $ 187,947 | $ 178,555 |
Deposits and prepaid expenses | 10,331 | 10,331 |
Property, plant and equipment | 335,426 | 335,426 |
Right-of-use asset | 716,869 | 757,313 |
Accounts payable and accrued expenses | 804,174 | 775,969 |
Notes payable, current, net of debt discount | 129,491 | 200,705 |
Lease liability | 171,297 | 166,895 |
Goodwill | 3,473,264 | 3,473,264 |
Royalty fee liability | 1,500,000 | $ 1,500,000 |
Consideration [Member] | ||
Cash | 2,000,110 | |
Notes payable, current, net of debt discount | 393,885 | |
Legal fees | (175,162) | |
Royalty fee liability | 1,500,000 | |
Total consideration | 3,718,833 | |
Fair value of net identifiable assets (liabilities) acquired [Member] | ||
Cash | 412,276 | |
Accounts receivable | 84,674 | |
Deposits and prepaid expenses | 15,139 | |
Notes receivables | 110,510 | |
Property, plant and equipment | 335,426 | |
Right-of-use asset | 796,771 | |
Total fair value of net identifiable assets | 1,754,796 | |
Accounts payable and accrued expenses | 625,462 | |
Notes payable, current, net of debt discount | 454,524 | |
PPP Loan | 439,160 | |
Lease liability | 796,771 | |
Total fair value of net identifiable liabilities | 2,315,917 | |
Fair value of net identifiable assets (liabilities) acquired | (561,121) | |
Goodwill | $ 4,279,954 |
BUSINESS ACQUISITION (Details 1
BUSINESS ACQUISITION (Details 1) - USD ($) | 3 Months Ended | 12 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | Jun. 30, 2021 | |
Net revenue | $ 316,566 | $ 0 | |
Net Loss | $ (259,318) | $ (230,462) | |
Net loss per share- basic and diluted | $ (0.02) | $ 0 | |
Weighted average number of shares of common stock outstanding- basic and diluted | 15,574,718 | 292,211 | |
Pro Forma [Member] | |||
Net revenue | $ 677,997 | ||
Net Loss | $ (3,513,187) | ||
Net loss per share- basic and diluted | $ (0.60) | ||
Weighted average number of shares of common stock outstanding- basic and diluted | 2,117,130 |
BUSINESS ACQUISITION (Details N
BUSINESS ACQUISITION (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | |
Jun. 30, 2021 | Mar. 25, 2021 | Sep. 30, 2021 | |
LIQUIDITY, CAPITAL RESOURCES AND GOING CONCERN | |||
Loss on impairment of goodwill | $ 806,690 | $ 806,690 | |
Cash acquired in business combination | $ 3,718,833 | ||
Purchase of subsidiary | 2,000,110 | ||
Royalty fee liability | $ 1,500,000 | $ 1,500,000 | |
Debt due to sellers | $ 393,885 |
NOTES RECEIVABLE (Details)
NOTES RECEIVABLE (Details) - USD ($) | Sep. 30, 2021 | Jun. 30, 2021 |
Notes receivable | $ 126,749 | $ 63,453 |
Less long-term | (14,466) | (14,466) |
Total short term notes receivable | 112,283 | 48,987 |
March 2023 [Member] | ||
Notes receivable | 35,987 | 41,985 |
March 2023 (1) [Member] | ||
Notes receivable | 79,294 | 0 |
December 2021 [Member] | ||
Notes receivable | $ 11,468 | $ 21,468 |
NOTES RECEIVABLE (Details 1)
NOTES RECEIVABLE (Details 1) | Sep. 30, 2021USD ($) |
LIQUIDITY, CAPITAL RESOURCES AND GOING CONCERN | |
2022 | $ 112,283 |
2023 | 14,466 |
Notes receivable | $ 126,749 |
PROPERTY, PLANT AND EQUIPMENT_2
PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) | Sep. 30, 2021 | Jun. 30, 2021 |
Property, plant and equipment | $ 335,426 | $ 335,426 |
Less: Accumulated depreciation | (23,347) | (9,638) |
Property, plant and equipment - net | 312,079 | 325,788 |
Leasehold improvements [Member] | ||
Property, plant and equipment | 294,864 | 294,864 |
Vehicles [Member] | ||
Property, plant and equipment | 22,554 | 22,554 |
Computer equipment [Member] | ||
Property, plant and equipment | 12,553 | 12,553 |
Furniture and fixtures [Member] | ||
Property, plant and equipment | $ 5,455 | $ 5,455 |
PROPERTY, PLANT AND EQUIPMENT_3
PROPERTY, PLANT AND EQUIPMENT (Details Narrative) - USD ($) | 3 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Jun. 30, 2021 | |
LIQUIDITY, CAPITAL RESOURCES AND GOING CONCERN | ||
Depreciation | $ 13,710 | $ 9,638 |
NOTES PAYABLE (Details)
NOTES PAYABLE (Details) - USD ($) | 3 Months Ended | |
Sep. 30, 2021 | Jun. 30, 2020 | |
Total Notes payable | $ 129,491 | $ 200,705 |
Debt instrument, principal balance | $ 514,438 | 514,438 |
Ref No. 3 [Member] | ||
Interest rate | 5.00% | |
Debt instrument, principal balance | $ 0 | 20,000 |
Debt instrument, original principal balance | $ 20,000 | |
Maturity date | 11/10/2021 | |
Date of issuance | 5/10/2021 | |
Ref No. 1 [Member] | ||
Interest rate | 10.00% | |
Debt instrument, principal balance | $ 129,491 | 137,755 |
Debt instrument, original principal balance | $ 146,021 | |
Maturity date | 12/15/2020 | |
Date of issuance | 12/25/2020 | |
Ref No. 4 [Member] | ||
Interest rate | 5.00% | |
Debt instrument, principal balance | $ 0 | 5,000 |
Debt instrument, original principal balance | $ 5,000 | |
Maturity date | 12/29/2021 | |
Date of issuance | 6/29/2021 | |
Ref No. 2 [Member] | ||
Interest rate | 10.00% | |
Debt instrument, principal balance | $ 0 | $ 37,949 |
Debt instrument, original principal balance | $ 37,950 | |
Maturity date | 6/3/2021 | |
Date of issuance | 3/25/2021 |
NOTES PAYABLE (Details Narrativ
NOTES PAYABLE (Details Narrative) - USD ($) | Jun. 30, 2021 | Jun. 30, 2020 |
NOTES PAYABLE | ||
Total Notes payable | $ 129,491 | $ 200,705 |
NOTES PAYABLE RELATED PARTIES (
NOTES PAYABLE RELATED PARTIES (Details) - USD ($) | 3 Months Ended | ||
Sep. 30, 2021 | Jun. 30, 2021 | Jun. 30, 2020 | |
Debt instrument, principal balance | $ 514,438 | $ 514,438 | |
Notes Payable Three [Member] | |||
Debt instrument, principal balance | $ 6,900 | $ 6,900 | |
Date of issuance | 10/18/11 | ||
Maturity date | 10/18/11 | ||
Interest rate | 8.00% | ||
Debt instrument, original principal balance | $ 6,900 | ||
Notes Payable Two [Member] | |||
Debt instrument, principal balance | $ 8,000 | 8,000 | |
Date of issuance | 6/15/12 | ||
Maturity date | 12/15/12 | ||
Interest rate | 10.00% | ||
Debt instrument, original principal balance | $ 8,000 | ||
Notes Payable One [Member] | |||
Debt instrument, principal balance | $ 50,000 | $ 50,000 | |
Date of issuance | 8/26/14 | ||
Maturity date | 2/26/14 | ||
Interest rate | 10.00% | ||
Debt instrument, original principal balance | $ 50,000 | ||
Related Party [Member] | Notes Payable Three [Member] | |||
Debt instrument, principal balance | $ 158,503 | 158,503 | |
Date of issuance | 3/25/2021 | ||
Maturity date | 6/3/2021 | ||
Interest rate | 10.00% | ||
Debt instrument, original principal balance | $ 158,503 | ||
Related Party [Member] | Notes Payable Two [Member] | |||
Debt instrument, principal balance | $ 47,436 | 47,435 | |
Date of issuance | 3/25/2021 | ||
Maturity date | 6/3/2021 | ||
Interest rate | 10.00% | ||
Debt instrument, original principal balance | $ 47,435 | ||
Related Party [Member] | Notes Payable One [Member] | |||
Debt instrument, principal balance | $ 308,500 | $ 308,500 | |
Date of issuance | 3/25/2021 | ||
Maturity date | 6/3/2021 | ||
Interest rate | 10.00% | ||
Debt instrument, original principal balance | $ 308,500 |
NOTES PAYABLE RELATED PARTIES_2
NOTES PAYABLE RELATED PARTIES (Details Narrative) - USD ($) | 3 Months Ended | 12 Months Ended | |
Sep. 30, 2021 | Jun. 30, 2021 | Jun. 30, 2020 | |
RELATED PARTY TRANSACTIONS | |||
Total Notes payable | $ 514,438 | $ 200,705 | |
Accrued interest, related parties | $ 18,431 | $ 9,459 |
CONVERTIBLE NOTES PAYABLE IN DE
CONVERTIBLE NOTES PAYABLE IN DEFAULT (Details) - USD ($) | 3 Months Ended | ||
Sep. 30, 2021 | Jun. 30, 2021 | Jun. 30, 2020 | |
Debt instrument, principal balance | $ 514,438 | $ 514,438 | |
Note Payable [Member] | |||
Notes payable | $ 349,900 | $ 349,900 | |
Notes Payable Seventeen [Member] | |||
Maturity date | 4/1/07 | ||
Date of issuance | 10/1/05 | ||
Interest rate | 10.00% | ||
Conversion rate | $ 0.50 | ||
Debt instrument, principal balance | $ 15,000 | 15,000 | |
Debt instrument, original principal balance | $ 15,000 | ||
Notes Payable Sixteen [Member] | |||
Maturity date | 9/9/08 | ||
Date of issuance | 9/16/06 | ||
Interest rate | 12.00% | ||
Debt instrument, principal balance | $ 38,000 | 38,000 | |
Debt instrument, original principal balance | $ 100,000 | ||
Conversion rate, percentage | 35% discount to market | ||
Notes Payable Fifteen [Member] | |||
Maturity date | 11/30/08 | ||
Date of issuance | 11/30/06 | ||
Interest rate | 10.00% | ||
Conversion rate | $ 0.85 | ||
Debt instrument, principal balance | $ 50,000 | 50,000 | |
Debt instrument, original principal balance | $ 50,000 | ||
Notes Payable Fourteen [Member] | |||
Maturity date | 12/23/08 | ||
Date of issuance | 12/23/06 | ||
Interest rate | 10.00% | ||
Conversion rate | $ 0.95 | ||
Debt instrument, principal balance | $ 18,000 | 18,000 | |
Debt instrument, original principal balance | $ 18,000 | ||
Notes Payable Thirteen [Member] | |||
Maturity date | 4/17/09 | ||
Date of issuance | 4/17/07 | ||
Interest rate | 10.00% | ||
Debt instrument, principal balance | $ 15,000 | 15,000 | |
Debt instrument, original principal balance | $ 15,000 | ||
Conversion rate, percentage | lesser $0.45 or 35% discount to market | ||
Notes Payable Twelve [Member] | |||
Maturity date | 1/29/09 | ||
Date of issuance | 1/29/07 | ||
Interest rate | 10.00% | ||
Conversion rate | $ 0.95 | ||
Debt instrument, principal balance | $ 15,000 | 15,000 | |
Debt instrument, original principal balance | $ 15,000 | ||
Notes Payable Eleven [Member] | |||
Maturity date | 6/15/09 | ||
Date of issuance | 6/14/07 | ||
Interest rate | 10.00% | ||
Debt instrument, principal balance | $ 15,000 | 15,000 | |
Debt instrument, original principal balance | $ 15,000 | ||
Conversion rate, percentage | lesser $0.50 or 25% discount to market | ||
Notes Payable Ten [Member] | |||
Maturity date | 4/17/09 | ||
Date of issuance | 4/17/07 | ||
Interest rate | 10.00% | ||
Debt instrument, principal balance | $ 20,000 | 20,000 | |
Debt instrument, original principal balance | $ 20,000 | ||
Conversion rate, percentage | lesser $0.45 or 35% discount to market | ||
Notes Payable Nine [Member] | |||
Maturity date | 2/26/09 | ||
Date of issuance | 2/26/07 | ||
Interest rate | 12.00% | ||
Debt instrument, principal balance | $ 30,000 | 30,000 | |
Debt instrument, original principal balance | $ 30,000 | ||
Conversion rate, percentage | lesser $0.50 or 35% discount to market | ||
Notes Payable Seven [Member] | |||
Maturity date | 8/26/12 | ||
Date of issuance | 8/26/09 | ||
Interest rate | 12.00% | ||
Debt instrument, principal balance | $ 20,000 | 20,000 | |
Debt instrument, original principal balance | $ 20,000 | ||
Conversion rate, percentage | lesser $0.01 or 20% discount to market | ||
Notes Payable Six [Member] | |||
Maturity date | 8/31/12 | ||
Date of issuance | 8/31/09 | ||
Interest rate | 12.00% | ||
Debt instrument, principal balance | $ 5,000 | 5,000 | |
Debt instrument, original principal balance | $ 5,000 | ||
Conversion rate, percentage | lesser $0.01 or 20% discount to market | ||
Notes Payable Five [Member] | |||
Maturity date | 10/31/10 | ||
Date of issuance | 10/31/09 | ||
Interest rate | 8.00% | ||
Debt instrument, principal balance | $ 4,000 | 4,000 | |
Debt instrument, original principal balance | $ 4,000 | ||
Conversion rate, percentage | 25% discount to average of the previous 5 days closing price | ||
Notes Payable Four [Member] | |||
Maturity date | 10/3/12 | ||
Date of issuance | 10/3/10 | ||
Interest rate | 10.00% | ||
Debt instrument, principal balance | $ 20,000 | 20,000 | |
Debt instrument, original principal balance | $ 20,000 | ||
Conversion rate, percentage | lesser $0.01 or 20% discount to market | ||
Notes Payable Three [Member] | |||
Maturity date | 10/18/11 | ||
Date of issuance | 10/18/11 | ||
Interest rate | 8.00% | ||
Debt instrument, principal balance | $ 6,900 | 6,900 | |
Debt instrument, original principal balance | $ 6,900 | ||
Conversion rate, percentage | 25% discount to market | ||
Notes Payable Two [Member] | |||
Maturity date | 12/15/12 | ||
Date of issuance | 6/15/12 | ||
Interest rate | 10.00% | ||
Conversion rate | $ 0.000350 | ||
Debt instrument, principal balance | $ 8,000 | 8,000 | |
Debt instrument, original principal balance | $ 8,000 | ||
Notes Payable One [Member] | |||
Maturity date | 2/26/14 | ||
Date of issuance | 8/26/14 | ||
Interest rate | 10.00% | ||
Conversion rate | $ 0.0001 | ||
Debt instrument, principal balance | $ 50,000 | 50,000 | |
Debt instrument, original principal balance | $ 50,000 | ||
Notes Payable Eight [Member] | |||
Maturity date | 8/25/12 | ||
Date of issuance | 8/25/09 | ||
Interest rate | 12.00% | ||
Debt instrument, principal balance | $ 20,000 | $ 20,000 | |
Debt instrument, original principal balance | $ 20,000 | ||
Conversion rate, percentage | lesser $0.01 or 20% discount to market |
NOTES PAYABLE, LONG TERM (Detai
NOTES PAYABLE, LONG TERM (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended |
Jun. 20, 2020 | Sep. 30, 2021 | Jun. 30, 2021 | |
Debt term | 5 years | ||
Interest rate | 1.00% | ||
Gain on PPP forgiveness loan amount | $ 172,520 | ||
Forgiveness for remaining balance | $ 266,640 | ||
Accrued interest related to PPP loan | 665 | ||
Sarah Day Care Centers, Inc. [Member] | |||
Proceeds from related party debt | 270,640 | ||
PPP loans forgiveness granted | 89,920 | ||
Sarah Adult Days Services, Inc [Member] | |||
Interest rate | 3.75% | ||
Accrued interest related to PPP loan | $ 731 | 1,402 | |
Proceeds from related party debt | $ 150,000 | 168,520 | |
PPP loans forgiveness granted | $ 82,600 |
DERIVATIVE FINANCIAL INSTRUME_3
DERIVATIVE FINANCIAL INSTRUMENTS (Details) - Compound embedded derivative [Member] - USD ($) | Sep. 30, 2021 | Jun. 30, 2021 |
Indexed Shares | 894,914 | 405,106 |
Fair Value | $ (189,548) | $ (254,700) |
DERIVATIVE FINANCIAL INSTRUME_4
DERIVATIVE FINANCIAL INSTRUMENTS (Details 1) - USD ($) | 3 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
DERIVATIVE FINANCIAL INSTRUMENTS | ||
Compound embedded derivative | $ 65,152 | $ (129,228) |
Day one derivative loss | 0 | 0 |
Total derivative gain (loss) | $ 65,152 | $ (129,228) |
DERIVATIVE FINANCIAL INSTRUME_5
DERIVATIVE FINANCIAL INSTRUMENTS (Details 2) - $ / shares | 3 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Quoted market price on valuation date | $ 0.50 | $ 0.0002 |
Range of effective contractual conversion rates | 0.00% | 0.00% |
Contractual term to maturity | 3 months | 3 months |
Market volatility: | 187.33% | |
Minimum [Member] | ||
Market volatility: | 138.28% | 138.28% |
Contractual conversion rate | $ 0.325 | $ 0.00010 |
Interest rate | 5.00% | 5.00% |
Maximum [Member] | ||
Market volatility: | 238.13% | 238.13% |
Contractual conversion rate | $ 0.80 | $ 0.00016 |
Interest rate | 12.00% | 12.00% |
Inception [Member] | ||
Quoted market price on valuation date | $ 0.01 | |
Range of effective contractual conversion rates | 0.00% | |
Contractual term to maturity | 1 year | |
Inception [Member] | Minimum [Member] | ||
Market volatility: | 138.28% | |
Contractual conversion rate | $ 0.0054 | |
Interest rate | 5.00% | |
Inception [Member] | Maximum [Member] | ||
Market volatility: | 238.13% | |
Contractual conversion rate | $ 0.0081 | |
Interest rate | 12.00% |
DERIVATIVE FINANCIAL INSTRUME_6
DERIVATIVE FINANCIAL INSTRUMENTS (Details 3) - USD ($) | 3 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Jun. 30, 2021 | |
DERIVATIVE FINANCIAL INSTRUMENTS | ||
Beginning balance | $ 254,700 | $ 257,493 |
Issuances Convertible Note Financing | 0 | 0 |
Removals | 0 | 0 |
Changes in fair value inputs and assumptions reflected | 65,152 | 233,264 |
Conversions | 0 | (226,057) |
Ending balance | $ 189,548 | $ 254,700 |
STOCKHOLDERS EQUITY (Details Na
STOCKHOLDERS EQUITY (Details Narrative) | Feb. 02, 2021USD ($)integershares | Feb. 11, 2011 | Mar. 19, 2021USD ($)shares | Feb. 19, 2021$ / sharesshares | Dec. 31, 2020USD ($)integer$ / sharesshares | Sep. 30, 2021$ / sharesshares | Sep. 15, 2021$ / sharesshares | Jun. 30, 2021$ / sharesshares |
Conversion of stock | 100 | |||||||
Common stock, shares par value | $ / shares | $ 0.000001 | $ 0.000001 | $ 0.000001 | |||||
Common stock, shares authorized | 500,000,000 | 130,000,000 | 130,000,000 | |||||
Preferred stock, shares par value | $ / shares | $ 0.000001 | $ 0.000001 | ||||||
Preferred stock, shares authorized | 500,000,000 | 500,000,000 | ||||||
Reverse stock split | On February 1, 2021, the Company filed all required Form 10-Q’s and 10-K’s to be up to date with its filings before filing its Form 15-12G on November 7, 2014. On February 11, 2021, the Company filed with FINRA to effectuate a 10,000:1 reverse stock split, change its name from Fresh Harvest Products, Inc. to Innovative MedTech, Inc. and change its stock symbol from ‘FRHV’ to ‘IMTH’. FINRA permitted these corporate actions on March 8, 2021. The 10,000:1 reverse split and the name change from Fresh Harvest Products, Inc., to Innovative MedTech, Inc. corporate actions took effect at the open of business on March 9, 2021. | |||||||
FINRA [Member] | ||||||||
Reverse stock split | 10,000:1 | |||||||
Board of Directors [Member] | ||||||||
Number of noteholders | integer | 5 | |||||||
Percentage of voting rights | 87.32% | |||||||
Three Noteholders [Member] | ||||||||
Conversion of stock | 6,439,917,317 | |||||||
Convertible promissory notes | $ | $ 325,666 | |||||||
Number of noteholders | integer | 3 | |||||||
Eleven Noteholders [Member] | ||||||||
Conversion of stock | 14,586,720,714 | |||||||
Convertible promissory notes | $ | $ 833,790 | |||||||
Number of noteholders | integer | 11 | |||||||
Two Board of Directors [Member] | ||||||||
Conversion of stock | 34,267,187,500 | |||||||
Convertible promissory notes | $ | $ 1,644,825 | |||||||
Notes Payable to Common Shares [Member] | ||||||||
Conversion of stock | 40,702,104,817 | |||||||
Stock issued for service | 1,050,000,000 | |||||||
Number of common share post split | 105,000 | |||||||
Convertible promissory notes | $ | $ 1,965,460 | |||||||
Series B Convertible Preferred Stock [Member] | ||||||||
Preferred stock, shares designated | 100,000 | 100,000 | ||||||
Preferred stock, shares par value | $ / shares | $ 0.000001 | $ 0.000001 | ||||||
Series A Preferred Stock | Seven Investors [Member] | ||||||||
Preferred Stock Shares | 317,500 | |||||||
Conversion of stock, amount | $ | $ 1,602,097 | |||||||
Series A and B Preferred Stock [Member] | ||||||||
Conversion of stock | 100 | |||||||
Common stock, shares par value | $ / shares | $ 0.000001 | |||||||
Common stock, shares authorized | 1,000,000,000,000 | |||||||
Preferred stock, shares par value | $ / shares | $ 0.000001 | |||||||
Preferred stock, shares authorized | 5,000,000,000 | |||||||
Series A Preferred Stocks [Member | ||||||||
Preferred stock, shares par value | $ / shares | $ 0.000001 | |||||||
Preferred Stock Shares | 47,400,000 | |||||||
Preferred stock, shares authorized | 5,000,000,000 | |||||||
Common stock | 474,000 | |||||||
Series B Preferred Stock [Member] | ||||||||
Preferred stock, shares par value | $ / shares | $ 0.000001 | |||||||
Preferred stock, shares authorized | 5,000,000,000 | |||||||
Series A Convertible Preferred Stock [Member] | ||||||||
Conversion of stock | 100 | |||||||
Preferred stock, shares designated | 100,000 | |||||||
Preferred stock, shares par value | $ / shares | $ 0.000001 | $ 0.000001 | ||||||
Preferred stock, shares authorized | 2,000,000 |
PROVISION FOR CORPORATE INCOM_3
PROVISION FOR CORPORATE INCOME TAXES (Details) | 3 Months Ended |
Sep. 30, 2021 | |
NOTES RECEIVABLE (Tables) | |
Statutory federal income tax rate | (21.00%) |
State taxes - net of federal benefits | (5.00%) |
Valuation allowance | 26.00% |
Income tax rate - net | 0.00% |
PROVISION FOR CORPORATE INCOM_4
PROVISION FOR CORPORATE INCOME TAXES (Details Narrative) - USD ($) | 3 Months Ended | |
Sep. 30, 2021 | Jun. 30, 2021 | |
NOTES RECEIVABLE (Tables) | ||
Change in valuation allowance | $ 54,457 | |
Valuation allowance | 2,846,527 | $ 2,792,070 |
Net operating losses | $ 13,555,000 |
UNPAID PAYROLL TAXES (Details N
UNPAID PAYROLL TAXES (Details Narrative) - USD ($) | Sep. 30, 2021 | Jun. 30, 2021 |
STOCKHOLDERS EQUITY | ||
Payroll related taxes, Internal Revenue Service | $ 60,402 | $ 17,401 |
Due to IRS and New York State payroll taxes | $ 77,803 | $ 77,803 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Narrative) | 3 Months Ended |
Sep. 30, 2021USD ($) | |
April 21, 2021 [Member] | |
Reneval options | 5 years |
Description of lease | the leases are for a ten-year period beginning on July 1, 2021, and ending on June 30, 2031, |
Per month rent | $ 7,500 |
Sarah Cares Corporate 2 Member | |
Description of Lease Square Two Feet | SarahCare location is for approximately 5,300 square feet located at 6199 Frank Ave. NW, North Canton, Ohio, 44720. The lease began in 2018 and ends in 2026. |
Sarah Cares Corporate 1 [Member] | |
Description of Lease Square Two Feet | SarahCare’s corporate office is approximately 3,470 square feet and is located at 4580 Stephen Circle NW, Canton, Ohio, 44718. The lease began in 2017 and ends in 2023. |
Sarah Cares Corporate [Member] | |
Description of Lease Square Two Feet | SarahCare location is for approximately 6,000 square feet located at SarahCare of Stow, 4472 Darrow Road, Stow, Ohio, 44224. The lease began in 2018 and ends in 2026. |
LEASES (Details)
LEASES (Details) - USD ($) | 1 Months Ended | 3 Months Ended |
Apr. 21, 2021 | Sep. 30, 2021 | |
Total Rent | $ 7,500 | |
January 1, 2022 to December 31, 2022 [Member] | ||
Covid-19 Recoup | $ 621 | |
Total Rent | 7,054 | |
Base Rent | 6,433 | |
January 1, 2023 to December 31, 2023 [Member] | ||
Covid-19 Recoup | 621 | |
Total Rent | 7,118 | |
Base Rent | 6,497 | |
January 1, 2024 to December 31, 2024 [Member] | ||
Covid-19 Recoup | 621 | |
Total Rent | 7,183 | |
Base Rent | 6,562 | |
January 1, 2025 to March 31, 2025 [Member] | ||
Covid-19 Recoup | 621 | |
Total Rent | 7,249 | |
Base Rent | 6,628 | |
April 1, 2021 [Member] | ||
Covid-19 Recoup | 983 | |
Total Rent | 7,352 | |
Base Rent | 6,369 | |
May 1, 2021 to December 31, 2021 [Member] | ||
Covid-19 Recoup | 621 | |
Total Rent | 6,990 | |
Base Rent | $ 6,369 |
LEASES (Details 1)
LEASES (Details 1) - USD ($) | Sep. 30, 2021 | Jun. 30, 2021 |
Right-of-use asset, net | $ 716,869 | $ 757,313 |
Stow Professional Center Lease [Member] | ||
Office lease | 282,371 | |
Less: accumulated amortization | (29,500) | |
Right-of-use asset, net | 252,871 | |
Harbor Lease [Member] | ||
Office lease | 120,003 | |
Less: accumulated amortization | (21,672) | |
Right-of-use asset, net | 98,331 | |
S. Frank Professional Leases [Member] | ||
Office lease | 412,770 | |
Less: accumulated amortization | (47,103) | |
Right-of-use asset, net | 365,667 | |
Right-of-use asset [Member] | ||
Office lease | 815,144 | |
Less: accumulated amortization | (98,275) | |
Right-of-use asset, net | $ 716,869 |
LEASES (Details 2)
LEASES (Details 2) - USD ($) | Sep. 30, 2021 | Jun. 30, 2020 |
Long term portion | $ 514,438 | $ 200,705 |
Operating Lease Liabilty [Member] | ||
Office lease | 717,229 | |
Less: current portion | (171,297) | |
Long term portion | 545,932 | |
Stow Professional Center Lease [Member] | ||
Office lease | 253,228 | |
Less: current portion | (62,642) | |
Long term portion | 190,586 | |
Harbor Lease [Member] | ||
Office lease | 98,332 | |
Less: current portion | (46,720) | |
Long term portion | 51,612 | |
S. Frank Professional Leases [Member] | ||
Office lease | 365,669 | |
Less: current portion | (61,935) | |
Long term portion | $ 303,734 |
LEASES (Details 3)
LEASES (Details 3) | Sep. 30, 2021USD ($) |
Year ending June 30, 2022 | $ 174,983 |
Year ending June 30, 2023 | 233,948 |
Year ending June 30, 2024 | 194,226 |
Year ending June 30, 2025 | 159,764 |
Year ending June 30, 2026 | 94,923 |
Year ending June 30, 2027 | 7,913 |
Present value discount | (148,528) |
Lease liability | 717,229 |
Stow Professional Center Lease [Member] | |
Year ending June 30, 2022 | 63,288 |
Year ending June 30, 2023 | 85,025 |
Year ending June 30, 2024 | 85,802 |
Year ending June 30, 2025 | 64,841 |
Year ending June 30, 2026 | 0 |
Year ending June 30, 2027 | 0 |
Present value discount | (45,728) |
Lease liability | 253,228 |
Harbor Leases [Member] | |
Year ending June 30, 2022 | 40,500 |
Year ending June 30, 2023 | 54,000 |
Year ending June 30, 2024 | 13,501 |
Year ending June 30, 2025 | 0 |
Year ending June 30, 2026 | 0 |
Year ending June 30, 2027 | 0 |
Present value discount | (9,669) |
Lease liability | 98,332 |
S. Frank Professional Lease [Member] | |
Year ending June 30, 2022 | 71,195 |
Year ending June 30, 2023 | 94,923 |
Year ending June 30, 2024 | 94,923 |
Year ending June 30, 2025 | 94,923 |
Year ending June 30, 2026 | 94,923 |
Year ending June 30, 2027 | 7,913 |
Present value discount | (93,131) |
Lease liability | $ 365,669 |
LEASES (Details Narrative)
LEASES (Details Narrative) | 3 Months Ended |
Sep. 30, 2021USD ($) | |
Harbor Lease [Member] | |
Monthly lease payments | $ 4,500 |
Lease expiration date | September 30, 2023 |
S Frank Professional Lease [Member] | |
Monthly lease payments | $ 7,910 |
Lease expiration date | July 1, 2026 |
Repayments for COVID relief | $ 603 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | ||||||
Apr. 21, 2021 | Sep. 30, 2021 | Sep. 28, 2021 | Sep. 08, 2021 | Jun. 30, 2021 | Mar. 25, 2021 | Mar. 19, 2021 | Dec. 30, 2020 | |
Ownership percentage | 84.11% | |||||||
Common stock issued, shares | 15,657,327 | 15,557,327 | ||||||
Common stock issued, value | $ 16 | $ 16 | ||||||
Lease expiration date | Jun. 30, 2031 | |||||||
Rent of each location per month | $ 7,500 | |||||||
Preferred shares issued, shares | 317,500 | 317,500 | ||||||
Preferred shares issued, value | $ 0 | $ 0 | ||||||
Preferred Stock, Par or Stated Value Per Share | $ 0.000001 | $ 0.000001 | ||||||
SarahCare [Member] | ||||||||
Lease beginning date | Jul. 1, 2021 | |||||||
Lease term | 10 years | |||||||
Lease expiration date | Jun. 30, 2031 | |||||||
Lease description | All of the leases are for a ten-year period beginning on July 1, 2021, and ending on June 30, 2031, with a 5-year renewal option. | |||||||
Rent of each location per month | $ 7,500 | |||||||
Preferred Stock Series A [Member] | ||||||||
Preferred shares issued, shares | 100,542 | |||||||
Preferred shares issued, value | $ 508,834 | |||||||
Preferred Stock, Par or Stated Value Per Share | $ 5.06 | |||||||
Restricted Stock [Member] | ||||||||
Share conversion price | $ 0.0503 | |||||||
Common stock issued, shares | 2,476,212 | |||||||
Common stock issued, value | $ 250,000 | |||||||
Mr. Everhardt [Member] | ||||||||
Ownership percentage | 50.00% | |||||||
Conversion of convertible notes and accrued interest | $ 114,244 | |||||||
Convertible notes and accrued interest coverted for shares, shares | 114,244 | |||||||
Share conversion price | $ 1 | |||||||
Note receivable | $ 50,000 | $ 29,294 | ||||||
Jay Odintz [Member] | Restricted Stock [Member] | Series A Preferred Stock | ||||||||
Share conversion price | $ 0.000048 | |||||||
Number of shares converted | 4,800,000 | |||||||
Common stock issued, shares | 48,000 | 4,518,062,500 | ||||||
Common stock issued, value | $ 216,867 | |||||||
Michael J Friedman [Member] | Restricted Stock [Member] | Series A Preferred Stock | ||||||||
Share conversion price | $ 0.000048 | |||||||
Number of shares converted | 42,600,000 | |||||||
Common stock issued, shares | 426,000 | 29,749,125,000 | ||||||
Common stock issued, value | $ 1,427,958 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended |
Apr. 21, 2021 | Sep. 30, 2021 | |
SUBSEQUENT EVENTS | ||
Rent for each location per month | $ 7,500 | |
Lease rent renewl term | 5 years | |
Lease expiration date | Jun. 30, 2031 | |
Lease period | 10 years | |
Lease commencement date | Jul. 1, 2021 |