Cover
Cover - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Apr. 15, 2021 | Jun. 30, 2020 | |
Cover [Abstract] | |||
Entity Registrant Name | Cosmos Holdings Inc. | ||
Entity Central Index Key | 0001474167 | ||
Document Type | 10-K | ||
Amendment Flag | false | ||
Entity Voluntary Filers | No | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well Known Seasoned Issuer | No | ||
Entity Small Business | true | ||
Entity Shell Company | false | ||
Entity Emerging Growth Company | false | ||
Entity Current Reporting Status | Yes | ||
Document Period End Date | Dec. 31, 2020 | ||
Entity Filer Category | Non-accelerated Filer | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2020 | ||
Entity Common Stock Shares Outstanding | 16,066,962 | ||
Entity Public Float | $ 12,946,815 | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Entity Interactive Data Current | Yes |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 628,395 | $ 38,537 |
Accounts receivable, net | 23,440,650 | 7,348,945 |
Accounts receivable - related party | 3,468,564 | 1,919,043 |
Marketable securities | 222,792 | 238,940 |
Inventory | 3,292,557 | 3,474,220 |
Prepaid expenses and other current assets | 5,148,441 | 1,553,436 |
Prepaid expenses and other current assets - related party | 3,468,653 | 5,940,124 |
Operating lease right-of-use asset | 833,763 | 498,180 |
Financing lease right-of-use asset | 269,131 | 167,310 |
TOTAL CURRENT ASSETS | 40,772,946 | 21,178,735 |
Property and equipment, net | 1,757,213 | 1,734,781 |
Goodwill and intangible assets, net | 230,506 | 263,681 |
Other assets | 905,318 | 702,439 |
Deferred tax assets | 178,430 | 0 |
TOTAL ASSETS | 43,844,413 | 23,879,636 |
CURRENT LIABILITIES: | ||
Accounts payable and accrued expenses | 11,973,981 | 7,761,517 |
Accounts payable and accrued expenses - related party | 1,733 | 240,302 |
Accrued interest | 742,374 | 800,164 |
Customer advances | 22,340 | 247,318 |
Convertible notes payable, net of unamortized discount of $494,973 and $29,509, respectively | 952,027 | 1,470,491 |
Derivative liability - convertible note | 460,728 | 0 |
Notes payable | 12,042,712 | 12,029,724 |
Notes payable - related party | 501,675 | 1,375,532 |
Lines of credit | 5,076,684 | 2,750,992 |
Loans payable - related party | 1,629,246 | 1,026,264 |
Taxes payable | 760,446 | 175,939 |
Operating lease liability, current portion | 200,204 | 139,556 |
Financing lease liability, current portion | 89,926 | 58,185 |
Other current liabilities | 339,000 | 165,271 |
TOTAL CURRENT LIABILITIES | 34,793,076 | 28,241,255 |
Share settled debt obligation | 1,554,590 | 1,554,590 |
Notes payable - long term portion | 10,771,882 | 0 |
Operating lease liability, net of current portion | 590,538 | 353,024 |
Financing lease liability, net of current portion | 188,172 | 82,523 |
Other liabilities | 107,168 | 109,073 |
TOTAL LIABILITIES | 48,005,426 | 30,340,465 |
Commitments and Contingencies (see Note 12) | 0 | 0 |
STOCKHOLDERS' DEFICIT: | ||
Preferred stock, $0.001 par value; 100,000,000 shares authorized; 0 shares issued and outstanding as of December 31, 2020 and 2019, respectively | 0 | 0 |
Common stock, $0.001 par value; 300,000,000 shares authorized; 13,485,128 and 13,225,587 shares issued and 13,069,800 and 12,860,059 outstanding as of December 31, 2020 and 2019, respectively | 13,484 | 13,225 |
Additional paid-in capital | 14,333,285 | 13,525,749 |
Treasury stock, 415,328 and 365,328 shares as of December 31, 2020 and 2019, respectively | (611,854) | (411,854) |
Accumulated deficit | (18,750,824) | (19,571,610) |
Accumulated other comprehensive loss | 854,896 | (16,339) |
TOTAL STOCKHOLDERS' DEFICIT | (4,161,013) | (6,460,829) |
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT | $ 43,844,413 | $ 23,879,636 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
CURRENT LIABILITIES: | ||
Convertible notes payable, net of unamortized discount | $ 494,973 | $ 29,509 |
STOCKHOLDERS' DEFICIT | ||
Common stock, shares par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, shares issued | 13,485,128 | 13,225,587 |
Common stock, shares outstanding | 13,069,800 | 12,860,059 |
Preferred stock, shares par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 100,000,000 | 100,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Treasury stock | 415,328 | 365,328 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS | ||
REVENUE | $ 55,406,337 | $ 39,676,385 |
COST OF GOODS SOLD | 47,345,957 | 36,014,116 |
GROSS PROFIT | 8,060,380 | 3,662,269 |
OPERATING EXPENSES | ||
General and administrative expenses | 4,185,322 | 3,289,413 |
Sales and marketing expenses | 763,170 | 234,037 |
Depreciation and amortization expense | 397,595 | 394,628 |
TOTAL OPERATING EXPENSES | 5,346,087 | 3,918,078 |
INCOME (LOSS) FROM OPERATIONS | 2,714,293 | (255,809) |
OTHER INCOME (EXPENSE) | ||
Other income, net | 4,571 | 233,877 |
Interest expense | (2,761,004) | (1,412,729) |
Interest income | 65,865 | 0 |
Non-cash interest expense | (34,106) | (320,205) |
Loss on equity investments, net | (34,443) | (1,220,085) |
Gain on extinguishment of debt | 942,029 | 0 |
Change in fair value of derivative liability | (4,158) | 0 |
Foreign currency transaction gain (loss), net | 305,274 | (141,199) |
TOTAL OTHER EXPENSE, NET | (1,515,972) | (2,860,341) |
INCOME (LOSS) BEFORE INCOME TAXES | 1,198,321 | (3,116,150) |
INCOME TAX EXPENSE | (377,535) | (182,815) |
NET INCOME (LOSS) | 820,786 | (3,298,965) |
OTHER COMPREHENSIVE INCOME (LOSS) | ||
Foreign currency translation adjustment, net | 871,235 | (49,167) |
TOTAL COMPREHENSIVE INCOME (LOSS) | $ 1,692,021 | $ (3,348,132) |
BASIC NET INCOME (LOSS) PER SHARE | $ 0.06 | $ (0.25) |
DILUTED NET INCOME (LOSS) PER SHARE | $ 0.06 | $ (0.25) |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING | ||
Basic | 13,270,097 | 13,273,596 |
Diluted | 13,307,795 | 13,273,596 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT - USD ($) | Total | Common Stock | Treasury Stock | Additional Paid-In Capital | Accumulated Deficit | Accumulated other comprehensive loss |
Balance, shares at Dec. 31, 2018 | 13,878,757 | (193,689) | ||||
Balance, amount at Dec. 31, 2018 | $ (3,317,450) | $ 13,879 | $ (225,494) | $ 13,133,982 | $ (16,272,645) | $ 32,828 |
Foreign currency translation adjustment, net | (49,167) | $ 0 | $ 0 | 0 | 0 | (49,167) |
Cancellation of pre-delivery shares issued in connection with convertible debentures, shares | (573,742) | |||||
Cancellation of pre-delivery shares issued in connection with convertible debentures, amount | 0 | $ (574) | $ 0 | 574 | 0 | 0 |
Purchase of treasury stock from third party, shares | (391,268) | |||||
Purchase of treasury stock from third party, amount | (845,247) | $ 0 | $ (845,247) | 0 | 0 | 0 |
Conversion of related party debt to common stock, shares | 140,001 | |||||
Conversion of related party debt to common stock, amount | 1,050,000 | $ 140 | $ 0 | 1,049,860 | 0 | 0 |
Cancellation of treasury shares, shares | (219,629) | 219,629 | ||||
Cancellation of treasury shares, amount | 0 | $ (220) | $ 658,887 | (658,667) | 0 | 0 |
Net loss | (3,298,965) | $ 0 | $ 0 | 0 | (3,298,965) | 0 |
Balance, shares at Dec. 31, 2019 | 13,225,387 | (365,328) | ||||
Balance, amount at Dec. 31, 2019 | (6,460,829) | $ 13,225 | $ (411,854) | 13,525,749 | (19,571,610) | (16,339) |
Foreign currency translation adjustment, net | 871,235 | $ 0 | $ 0 | 0 | 0 | 871,235 |
Purchase of treasury stock from third party, shares | (50,000) | |||||
Purchase of treasury stock from third party, amount | (200,000) | $ 0 | $ (200,000) | 0 | 0 | 0 |
Conversion of related party debt to common stock, shares | 259,741 | |||||
Net loss | 820,786 | $ 0 | $ 0 | 0 | 820,786 | 0 |
Conversion of note payable into shares of common stock, amount | 807,795 | $ 259 | $ 0 | 807,536 | 0 | 0 |
Balance, shares at Dec. 31, 2020 | 13,485,128 | (415,328) | ||||
Balance, amount at Dec. 31, 2020 | $ (4,161,013) | $ 13,484 | $ (611,854) | $ 14,333,285 | $ (18,750,824) | $ 854,896 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income (loss) | $ 820,786 | $ (3,298,965) |
Adjustments to Reconcile Net Income (Loss) to Net Cash Used In Operating Activities: | ||
Depreciation and amortization expense | 274,062 | 234,086 |
Amortization of right-of-use assets | 123,533 | 160,542 |
Amortization of debt discounts | 34,105 | 320,205 |
Lease expense | 188,400 | 185,540 |
Interest on finance leases | 13,759 | 0 |
Deferred income taxes | (178,430) | 0 |
Gain on extinguishment of debt | (942,029) | 0 |
Change in fair value of the derivative liability | 4,158 | 0 |
Loss on change in fair value of equity investments | 34,443 | 1,220,085 |
Changes in Assets and Liabilities: | ||
Accounts receivable, net | (14,417,946) | (2,595,654) |
Accounts receivable - related party | (1,299,818) | (1,729,283) |
Inventory | 393,154 | (271,453) |
Prepaid expenses and other current assets | (3,332,839) | 76,773 |
Prepaid expenses and other current assets - related party | 2,800,862 | (983,063) |
Other assets | (131,700) | (77,047) |
Accounts payable and accrued expenses | 3,448,613 | 3,101,143 |
Accounts payable and accrued expenses - related party | (240,189) | 100,746 |
Accrued interest | 654,297 | (472,926) |
Customer advances | (230,505) | (819,882) |
Other current liabilities | 173,729 | 54,059 |
Lease liabilities | (217,210) | (142,846) |
Taxes payable | 584,507 | 175,939 |
Other liabilities | (59,460) | (26,841) |
NET CASH USED IN OPERATING ACTIVITIES | (11,501,718) | (4,788,842) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of fixed assets | (117,744) | (672,789) |
Proceeds from sale of investments | 0 | 1,261,718 |
NET CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES | (117,744) | 588,929 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Payment of convertible note payable | (593,000) | (365,514) |
Proceeds from convertible note payable | 497,000 | 1,380,000 |
Payment of related party note payable | (996,136) | (382,055) |
Payment of note payable | (5,230,725) | (221,418) |
Proceeds from note payable | 16,556,710 | 2,500,000 |
Payment of related party loan | (149,695) | (262,226) |
Proceeds from related party loan | 721,723 | 585,915 |
Payment of lines of credit | (18,428,823) | (11,098,839) |
Proceeds from lines of credit | 20,369,291 | 12,371,190 |
Payments of finance lease liability | (85,804) | (74,476) |
Purchase of treasury stock | (200,000) | (845,247) |
NET CASH PROVIDED BY FINANCING ACTIVITIES | 12,460,541 | 3,587,330 |
Effect of exchange rate changes on cash | (251,221) | (213,223) |
NET CHANGE IN CASH | 589,858 | (825,806) |
CASH AT BEGINNING OF PERIOD | 38,537 | 864,343 |
CASH AT END OF PERIOD | 628,395 | 38,537 |
Cash paid during the period: | ||
Interest | 955,376 | 447,731 |
Income tax | 14,127 | 11,605 |
Supplemental Disclosure of Non-Cash Investing and Financing Activities | ||
Cancellation of pre-delivery shares issued for conversion of convertible notes payable | 0 | 574 |
Discounts related to beneficial conversion features of convertible debentures | 0 | 120,000 |
Conversion of notes payable to common stock | $ 807,795 | $ 1,050,000 |
ORGANIZATION AND NATURE OF BUSI
ORGANIZATION AND NATURE OF BUSINESS | 12 Months Ended |
Dec. 31, 2020 | |
ORGANIZATION AND NATURE OF BUSINESS | |
NOTE 1 - ORGANIZATION AND NATURE OF BUSINESS | Cosmos Holdings, Inc. is an international pharmaceutical wholesaler. The Company imports, exports and distributes brand-name and generic pharmaceuticals, over-the-counter (“OTC”) medicines, a variety of vitamins, and dietary supplements. Through December 31, 2020, we operated our business through three wholly owned subsidiaries: (i) SkyPharm S.A. (“SkyPharm”), headquartered in Thessaloniki, Greece; (ii) Decahedron Ltd. (“Decahedron”), headquartered in Harlow, United Kingdom (“UK”); and (iii) Cosmofarm Ltd. (“Cosmofarm”), headquartered in Athens, Greece. Our business is primarily comprised of cross-border sales of brand-name pharmaceutical products in the European Union (“EU”). Our cross-border pharmaceutical wholesale business serves wholesale pharmaceutical distributors and independent retail pharmacies across the EU through a network of three strategic distribution centers, as well as an additional warehousing facility. Pharmaceutical manufacturers generally implement variable pricing strategies within the EU market. Identifying and evaluating price spreads between EU member states enables us to source brand-name pharmaceuticals from countries where ex-factory prices are comparatively low and export to countries where the same products are priced higher. We remain focused on leveraging our growing purchasing scale and supplier relationships to secure discounts and provide pharmaceuticals at reduced prices and continuing to drive organic growth at attractive margins for our cross-border pharmaceutical wholesale business. We regularly evaluate and undertake strategic initiatives to expand our distribution reach, improve our profit margins, and strengthen our competitive position. In 2018, we entered the vitamins and dietary supplements segment and in the fourth quarter of 2018 we posted the first sales of our own brand of nutraceuticals; SkyPremium Life We make use of analytics and customer feedback from our EU-wide network of wholesale pharmaceutical distributors and independent retail pharmacies to identify and evaluate which nutraceutical product codes to develop to add to our SkyPremium Life SkyPremium Life We are also closely monitoring the legal framework for prescription and non-prescription derivatives of cannabis products as it develops in Europe. As the legal framework and processes are developed and implemented in each respective EU country, we intend to utilize our existing network to distribute both prescription and non-prescription derivatives of cannabis products to our current customer base. We currently intend to only distribute prescription and non-prescription derivatives of cannabis products to approved EU countries and not in the US. We regularly evaluate acquisition targets that would allow us to expand our distribution reach and/or vertically integrate into the supply chain of the products that we currently distribute. We believe that the demand for reasonably priced medicines, delivered on time and in the highest quality is set to increase in the years to come, as the population’s life expectancy increases. With our product portfolio of patented and non-patented medicines, we contribute to the optimization of efficient medicinal care, and thereby lowering cost for health insurance funds, companies, and patients. We also believe that the demand for non-prescription wellness products such as food and dietary supplements will continue to increase as individuals are increasingly supplementing their nutritional intake. We believe the EU pharmaceutical import/export market will continue to grow. We continue to encounter competition in the market as we grow. The competition comes in the form of level of service, reliability, and product quality. On the procurement side, we continue to expand our vendor base. In order to minimize business risks, we diversify our sources of supply. We maintain our high-quality standards by carefully selecting and qualifying our suppliers as well as actively ensuring that our suppliers meet our standard of quality control on an ongoing basis. On July 22, 2015, the Hellenic Ministry of Health and more specifically the National Organization for Medicines granted SkyPharm a license for the wholesale of pharmaceutical products for human use. The license is valid for a period of five years and pursuant to the EU directive of (2013/C343/01). Decahedron received its Wholesale Distribution Authorization for human use on November 7, 2013, from the UK Medicines and Healthcare Products Regulatory Agency (MHRA) in accordance with Regulation 18 of the Human Medicines Regulations 2012 (SI 2012/1916) and it is subject to the provision of those Regulations and the Medicines Act 1971. This license will continue to remain in force from the date of issue by the Licensing Authority unless cancelled, suspended, revoked or varied as to the period of its validity or relinquished by the authorization holder. On February 1, 2019, the Hellenic Ministry of Health and the National Organization for Medicines extended the validity of Cosmofarm’s license for the wholesale of pharmaceutical products for human use for a period of five years and pursuant to the EU directive of (2013/C 343/01). Corporate History and Structure Cosmos Holdings, Inc. was incorporated in the State of Nevada under the name Prime Estates and Developments, Inc. on July 21, 2009. On November 14, 2013, we changed our name to Cosmos Holdings, Inc. On September 27, 2013, the Company, closed a reverse merger transaction by which it acquired a private company whose principal activities are the trading of products, providing representation, and provision of consulting services to various sectors. Pursuant to a Share Exchange Agreement between the Registrant and Amplerissimo Ltd., a company incorporated in Cyprus (“Amplerissimo”), the Company acquired 100% of Amplerissimo’s issued and outstanding common stock. As a result of the reverse take-over transaction, Amplerissimo became a wholly owned subsidiary of the Company. On August 1, 2014, the Company, through its Cypriot subsidiary Amplerissimo, formed SkyPharm S.A., a Greek Company (“SkyPharm”), a subsidiary that focuses on the trading, sourcing and distribution of pharmaceutical products. In February 2017, the Company completed the acquisition of Decahedron Ltd., a UK Company (“Decahedron”) consummating the transactions contemplated by the Stock Purchase Agreement, dated November 17, 2016 as amended (the “Decahedron SPA”). Pursuant to the terms of the Decahedron SPA, the shareholders of Decahedron received an aggregate of 170,000 shares of common stock of the Company (the “Stock Consideration”), which were delivered following the closing in exchange for all of the ordinary shares of Decahedron for the stock consideration. Decahedron is a fully licensed wholesaler of pharmaceutical products and its primary activity is the distribution, import and export of pharmaceuticals. On November 21, 2017, the Company effected a one-for-ten (1:10) reverse stock split whereby the Company decreased, by a ratio of one-for-ten (1:10) the number of issued and outstanding shares of common stock. Proportional adjustments for the reverse stock split were made to the Company’s outstanding stock options, and warrants including all share and per-share data, for all amounts and periods presented in the consolidated financial statements. On September 29, 2018, Amplerissimo transferred its remaining 22% investment in SkyPharm to the Company. The Company now holds 100% of the capital of SkyPharm as a wholly-owned subsidiary of the Company. On September 30, 2018, the Company entered into a Share Purchase Agreement with an unaffiliated third party and sold 100% of the issued capital of its subsidiary, Amplerissimo. On December 19, 2018, the Company completed the purchase of all of the capital stock of Cosmofarm Ltd., a pharmaceutical wholesaler based in Athens, Greece. The principal of the selling shareholder is Panagiotis Kozaris, who remained with Cosmofarm as a director and chief operating officer once it became a wholly owned subsidiary of the Company. Grigorios Siokas, the Company’s CEO, became the new CEO of Cosmofarm. Mr. Kozaris had no prior relationship to the Company other than as an independent shareholder. The purchase price payable is €200,000 evidenced by a promissory note. Going Concern The Company’s consolidated financial statements are prepared in conformity with U.S. GAAP, which contemplates the continuation of the Company as a going concern. For the year ended December 31, 2020, the Company had revenue of $55,406,337, net income of $820,786 and net cash used in operations of $11,501,718. Additionally, as of December 31, 2020, the Company had working capital of $5,979,870, an accumulated deficit of $18,750,824, and stockholders’ deficit of $4,161,013. It is management’s opinion that these conditions raise substantial doubt about the Company’s ability to continue as a going concern for a period of twelve months from the date of this filing. During the fiscal year, the Company has undergone strategic review processes to help find a definitive solution to the Company's accumulated deficit constraints. Options under consideration in the strategic review process include, but are not limited to, securing new debt, exchange debt to equity, restructuring current debt facilities from short term to long term and making the proper actions for new fund raising. The consolidated financial statements do not include any adjustments to reflect the possible future effect on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from the outcome of this uncertainty. The Company has adequate cash from operations in order to cover its operating costs and to continue at a going concern basis. Nevertheless, the ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund its operations. If the Company is unable to obtain adequate capital, it could be forced to cease development of operations. In order to continue as a going concern, develop a reliable source of revenues, and achieve a profitable level of operations, the Company will need, among other things, additional capital resources. Management’s plans to continue as a going concern include raising additional capital through increased sales of product and by sale of equity and/or debt. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans. The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described herein and eventually secure other sources of financing and attain profitable operations. Summary of Significant Accounting Policies Basis of Financial Statement Presentation The accompanying consolidated financial statements have been prepared in accordance with principles generally accepted in the United States of America. Principles of Consolidation Our consolidated accounts include our accounts and the accounts of our wholly-owned subsidiaries, SkyPharm S.A., Decahedron Ltd. and Cosmofarm Ltd. All significant intercompany balances and transactions have been eliminated. Use of Estimates The preparation of the consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Effects of COVID-19 Due to the COVID-19 pandemic, there has been uncertainty and disruption in the global economy and financial markets. The Company is not aware of any specific event or circumstance that would require an update to its estimates or judgments or a revision of the carrying value of its assets or liabilities as of April 15, 2021, the date of issuance of this Annual Report on Form 10-K. These estimates may change, as new events occur, and additional information is obtained. Actual results could differ materially from these estimates under different assumptions or conditions. Foreign Currency Translation and Other Comprehensive Income (Loss) The functional currency of the Company’s subsidiaries is the Euro and British Pound. For financial reporting purposes, both the Euro (“EUR”) and British Pound (“GBP”) have been translated into United States dollars ($) and/or (USD) as the reporting currency. Assets and liabilities are translated at the exchange rate in effect at the balance sheet date. Revenues and expenses are translated at the average rate of exchange prevailing during the reporting period. Equity transactions are translated at each historical transaction date spot rate. Translation adjustments arising from the use of different exchange rates from period to period are included as a component of stockholders’ equity (deficit) as “Accumulated other comprehensive income (loss).” Gains and losses resulting from foreign currency transactions are included in the statements of operations and comprehensive loss as other comprehensive income (loss). There have been no significant fluctuations in the exchange rate for the conversion of EUR or GBP to USD after the balance sheet date. Other Comprehensive Income (Loss) for all periods presented includes only foreign currency translation gains (losses). Assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing at the consolidated balance sheet date with any transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency included in the consolidated results of operations as incurred. As of December 31, 2020 and 2019, the exchange rates used to translate amounts in Euros into USD and British Pounds into USD for the purposes of preparing the consolidated financial statements were as follows: December 31, 2020 December 31, 2019 Exchange rate on balance sheet dates EUR: USD exchange rate 1.2230 1.1227 GBP: USD exchange rate 1.3662 1.3185 Average exchange rate for the period EUR: USD exchange rate 1.1410 1.1194 GBP: USD exchange rate 1.2829 1.2767 Cash and Cash Equivalents For purposes of the statement of cash flows, the Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. As of December 31, 2020 and December 31, 2019, there were no cash equivalents. The Company maintains bank accounts in the United States denominated in U.S. Dollars and in Greece and in Bulgaria all of which are denominated in Euros. Additionally, the Company maintains a bank account in the United Kingdom denominated in British Pounds. As of December 31, 2020, the amounts in these accounts were $448,659, $134,935 and $1,651. As of December 31, 2019, the amounts in these accounts were $14,451, $10,987 and $4,080. Additionally, as of December 31, 2020 and 2019, the Company had cash on hand in the amount of $31,604 and $52,489, respectively. Reclassifications to Prior Period Financial Statements and Adjustments Certain reclassifications have been made in the Company’s financial statements of the prior period to conform to the current year presentation. $4,381 in other investments for the year ended December 31, 2019 was reclassified to other current assets. $800,164 in accounts payable and accrued expenses was reclassified to accrued interest. For the year ended December 31, 2019, $264 in interest expense – related parties was reclassified to interest expense. Additionally, for the year ended December 31, 2019, $234,037, respectively in sales and marketing expenses were reclassified from general and administrative expenses. These reclassifications have no impact on previously reported net loss. Accounts Receivable, net Accounts receivable are stated at their net realizable value. The allowance for doubtful accounts against gross accounts receivable reflects the best estimate of probable losses inherent in the receivables portfolio determined on the basis of historical experience, specific allowances for known troubled accounts and other currently available information. At December 31, 2020 and 2019, the Company’s allowance for doubtful accounts was $715,845 and $529,252, respectively. Tax Receivables The Company pays Value Added Tax (“VAT”) or similar taxes (“input VAT”), income taxes, and other taxes within the normal course of its business in most of the countries in which it operates related to the procurement of merchandise and/or services it acquires and/or on sales and taxable income. The Company also collects VAT or similar taxes on behalf of the government (“output VAT”) for merchandise and/or services it sells. If the output VAT exceeds the input VAT, this creates a VAT payable to the government. If the input VAT exceeds the output VAT, this creates a VAT receivable from the government. The VAT tax return is filed on a monthly basis offsetting the payables against the receivables. In observance of EU regulations for intra-EU cross-border sales, our subsidiaries in Greece, SkyPharm and Cosmofarm, do not charge VAT for sales to wholesale drug distributors registered in other European Union member states. As of December 31, 2020 and 2019, the Company had a VAT net payable balance of $159,198 and $136,891 respectively, recorded in the consolidated balance sheet as prepaid expenses and other current assets. Inventory Inventory is stated at net realizable value using the weighted average method. Inventory consists primarily of finished goods and packaging materials, i.e. packaged pharmaceutical products and the wrappers and containers they are sold in. A periodic inventory system is maintained by 100% count. Inventory is replaced periodically to maintain the optimum stock on hand available for immediate shipment. The Company writes-down inventories to net realizable value based on physical condition, expiration date, current market conditions, as well as forecasted demand. The Company’s inventories are not highly susceptible to obsolescence. Many of the Company’s inventory items are eligible for return to our suppliers when pre-agreed product requirements, including, but not limited to, physical condition and expiration date, are not met. Property and Equipment, net Property and equipment are stated at cost, less accumulated depreciation. Depreciation is provided on a straight-line basis over the useful lives (except for leasehold improvements which are depreciated over the lesser of the lease term or the useful life) of the assets as follows: Estimated Useful Life Leasehold improvements and technical works Lesser of lease term or 40 years Vehicles 6 years Machinery 20 years Furniture, fixtures and equipment 5–10 years Computers and software 3-5 years Depreciation expense was $240,886 and $201,000 for the years ended December 31, 2020 and 2019, respectively. Impairment of Long-Lived Assets In accordance with ASC 360-10, Long-lived Assets, which include property and equipment and intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of long-lived assets to be held and used is measured by a comparison of the carrying amount of an asset to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated undiscounted future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the assets. Fair value is generally determined using the asset’s expected future discounted cash flows or market value, if readily determinable. For the years ended December 31, 2020 and 2019, the Company had no impairment of long-lived assets. Goodwill and Intangibles, net The Company periodically reviews the carrying value of intangible assets not subject to amortization, including goodwill, to determine whether impairment may exist. Goodwill and certain intangible assets are assessed annually, or when certain triggering events occur, for impairment using fair value measurement techniques. These events could include a significant change in the business climate, legal factors, a decline in operating performance, competition, sale or disposition of a significant portion of the business, or other factors. Specifically, goodwill impairment is determined using a two-step process. The first step of the goodwill impairment test is used to identify potential impairment by comparing the fair value of a reporting unit with its carrying amount, including goodwill. The Company uses level 3 inputs and a discounted cash flow methodology to estimate the fair value of a reporting unit. A discounted cash flow analysis requires one to make various judgmental assumptions including assumptions about future cash flows, growth rates, and discount rates. The assumptions about future cash flows and growth rates are based on the Company’s budget and long-term plans. Discount rate assumptions are based on an assessment of the risk inherent in the respective reporting units. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired and the second step of the impairment test is unnecessary. If the carrying amount of a reporting unit exceeds its fair value, the second step of the goodwill impairment test is performed to measure the amount of impairment loss, if any. The second step of the goodwill impairment test compares the implied fair value of the reporting unit’s goodwill with the carrying amount of that goodwill. If the carrying amount of the reporting unit’s goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess. The implied fair value of goodwill is determined in the same manner as the amount of goodwill recognized in a business combination. That is, the fair value of the reporting unit is allocated to all of the assets and liabilities of that unit (including any unrecognized intangible assets) as if the reporting unit had been acquired in a business combination and the fair value of the reporting unit was the purchase price paid to acquire the reporting unit. On December 19, 2018, as a result of the acquisition of Cosmo farm, the Company recorded $49,697 of goodwill. Intangible assets with definite useful lives are recorded on the basis of cost and are amortized on a straight-line basis over their estimated useful lives. The Company uses a useful life of 5 years for an import/export license. The Company evaluates the remaining useful life of intangible assets annually to determine whether events and circumstances warrant a revision to the remaining amortization period. If the estimate of the intangible asset’s remaining useful life is changed, the remaining carrying amount of the intangible asset will be amortized prospectively over that revised remaining useful life. As of December 31, 2020, no revision to the remaining amortization period of the intangible assets was made. Amortization expense was $33,176 and $33,086 for the years ended December 31, 2020 and 2019, respectively. Equity Method Investment For those investments in common stock or in-substance common stock in which the Company has the ability to exercise significant influence over the operating and financial policies of the investee, the investment is accounted for under the equity method. The Company records its share in the earnings of the investee and is included in “Equity earnings of affiliate” in the consolidated statement of operations. The Company assesses its investment for other-than-temporary impairment when events or changes in circumstances indicate that the carrying amount of the investment might not be recoverable and recognizes an impairment loss to adjust the investment to its then current fair value. Investments in Equity Securities Effective January 1, 2018, the Company adopted Accounting Standards Update (“ASU”) 2016-01, and accordingly, investments in equity securities are accounted for at fair value with changes in fair value recognized in net income. Equity securities are classified as short-term or long-term based on the nature of the securities and their availability to meet current operating requirements. Equity securities that are readily available for use in current operations are reported as a component of current assets in the accompanying consolidated balance sheets. Equity securities that are not considered available for use in current operations would be reported as a component of long-term assets in the accompanying consolidated balance sheets. For equity securities with no readily determinable fair value, the Company elects a measurement alternative to fair value. Under this alternative, the Company measures the investments at cost, less any impairment, and adjusted for changes resulting from observable price changes in transactions for identical or similar investments of the investee. The election to use the measurement alternative is made for each eligible investment. As of December 31, 2020, investments consisted of 3,000,000 shares, which traded at a closing price of $0 per share or a value of $0 of ICC International Cannabis Corp., 40,000 shares which traded at a closing price of $5.45 per share, or value of $218,183 of Diversa S.A. and 16,666 shares which traded at a closing price of $0.28 per share or value of $4,609 of National Bank of Greece. Additionally, the Company has $4,772 in equity securities of Pancreta bank, which are not publicly traded and recorded at cost. See Note 2, for additional investments in equity securities. Fair Value Measurement The Company applies FASB ASC 820, Fair Value Measurements and Disclosures, (“ASC 820”), for assets and liabilities measured at fair value on a recurring basis. ASC 820 establishes a common definition for fair value to be applied to existing generally accepted accounting principles that require the use of fair value measurements establishes a framework for measuring fair value and expands disclosure about such fair value measurements. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Additionally, ASC 820 requires the use of valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized below: Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2: Inputs other than quoted prices that are observable, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. Level 3: Unobservable inputs in which little or no market data exists, therefore developed using estimates and assumptions developed by us, which reflect those that a market participant would use. The following table presents assets that are measured and recognized at fair value as of December 31, 2020 and 2019, on a recurring basis: December 31, 2020 Total Carrying Level 1 Level 2 Level 3 Value Marketable securities – ICC International Cannabis Corp. $ - - - $ - Marketable securities – Divsersa S.A. 218,183 - - 218,183 Marketable securities – National Bank of Greece 4,609 - - 4,609 $ 222,792 $ 222,792 December 31, 2019 Total Carrying Level 1 Level 2 Level 3 Value Marketable securities – ICC International Cannabis Corp. $ 33,000 - - $ 33,000 Marketable securities – Divsersa S.A. 200,290 - - 200,290 Marketable securities – National Bank of Greece 5,650 - - 5,650 $ 238,940 $ 238,940 FASB ASC 825-10-25 Fair Value Option, (“ASC 825-10-25”), expands opportunities to use fair value measurements in financial reporting and permits entities to choose to measure many financial instruments and certain other items at fair value. The Company did not elect the fair value options for any of its qualifying financial instruments. Derivative Instruments Derivative financial instruments are recorded in the accompanying consolidated balance sheets at fair value in accordance with ASC 815. When the Company enters into a financial instrument such as a debt or equity agreement (the “host contract”), the Company assesses whether the economic characteristics of any embedded features are clearly and closely related to the primary economic characteristics of the remainder of the host contract. When it is determined that (i) an embedded feature possesses economic characteristics that are not clearly and closely related to the primary economic characteristics of the host contract, and (ii) a separate, stand-alone instrument with the same terms would meet the definition of a financial derivative instrument, then the embedded feature is bifurcated from the host contract and accounted for as a derivative instrument. The estimated fair value of the derivative feature is recorded in the accompanying consolidated balance sheets separately from the carrying value of the host contract. Subsequent changes in the estimated fair value of derivatives are recorded as a gain or loss in the Company’s consolidated statements of operations. Customer Advances The Company receives prepayments from certain customers for pharmaceutical products prior to those customers taking possession of the Company’s products. The Company records these receipts as customer advances until it has met all the criteria for recognition of revenue including passing control of the products to its customer, at such point, the Company will reduce the customer and deposits balance and credit the Company’s revenues. Revenue Recognition In accordance with ASC 606, Revenue from Contracts with Customers, the Company uses a five-step model for recognizing revenue by applying the following steps: (1) identify the contract with the customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when (or as) the performance obligations are satisfied by transferring the promised goods to the customer. Once these steps are met, revenue is recognized upon delivery of the product. Stock-based Compensation The Company records stock-based compensation in accordance with ASC 718, Stock Compensation (“ASC 718”) and Staff Accounting Bulletin No. 107 (“SAB 107”) issued by the SEC in March 2005 regarding its interpretation of ASC 718. ASC 718 requires the fair value of all stock-based employee compensation awarded to employees to be recorded as an expense over the related requisite service period. The Company values any employee or non-employee stock-based compensation at fair value using the Black-Scholes Option Pricing Model. The Company accounts for non-employee share-based awards in accordance with the measurement and recognition criteria of ASU 2018-07, “Compensation-Stock Compensation-Improvements to Nonemployee Share-Based Payment Accounting.” Foreign Currency Translations and Transactions Assets and liabilities of all foreign operations are translated at year-end rates of exchange, and the statements of operations are translated at the average rates of exchange for the year. Gains or losses resulting from translating foreign currency financial statements are accumulated in a separate component of stockholders’ equity until the entity is sold or substantially liquidated. Gains or losses from foreign currency transactions (transactions denominated in a currency other than the entity’s local currency) are included in net earnings. Concentrations of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash investments and accounts receivable. The following tables show the number of the Company’s clients which contributed 10% or more of revenue and accounts receivable, respectively: Year Ended December 31, Year Ended December 31, 2020 2019 Number of 10% clients 1 0 Percentage of total revenue 14.82 % n/a Percentage of total AR 14.65 % n/a Income Taxes The Company accounts for income taxes under the asset and liability method, as re |
MARKETABLE SECURITIES
MARKETABLE SECURITIES | 12 Months Ended |
Dec. 31, 2020 | |
MARKETABLE SECURITIES | |
NOTE 2 - MARKETABLE SECURITIES | Distribution and Equity Agreement On March 19, 2018, the Company entered into a Distribution and Equity Acquisition Agreement (the “Distribution and Equity Acquisition Agreement”) with Marathon Global Inc. (“Marathon”), a company incorporated in the Province of Ontario, Canada. Marathon was formed to be a global supplier of cannabis, cannabidiol (CBD) and/or any cannabis extract products, extracts, ancillaries and derivatives (collectively, the “Products”). The Company was appointed the exclusive distributor of the Products initially throughout Europe and on a non-exclusive basis wherever else lawfully permitted. The Company has no present intention to distribute any Products under this Agreement in the United States or otherwise participate in cannabis operations in the United States. The Company intends to await further clarification from the U.S. Government on cannabis regulation prior to determining whether to enter the domestic market. The Distribution and Equity Acquisition Agreement is to remain in effect indefinitely unless Marathon fails to provide Market Competitive (as defined) product pricing and Marathon has not become profitable within five (5) years of the agreement. The transaction closed on May 22, 2018 after the due diligence period, following which the Company received: (a) a 33 1/3% equity interest or 5 million shares in Marathon as partial consideration for the Company’s distribution services; and (b) received cash of CAD $2,000,000, subject to repayment in common shares of the Company if it fails to meet certain performance milestones. The Company is entitled to receive an additional CAD $2,750,000 upon the Company’s receipt of gross sales of CAD $6,500,000 and an additional CAD $2,750,000 upon receipt of gross sales of CAD $13,000,000. The Company was also given the right to nominate one director to the Marathon board of directors. Since Marathon is a newly formed entity with no assets and no activity, the Company attributed no value to the 5 million shares in Marathon which was received as consideration for the distribution services. As described below, the Company exchanged the Marathon shares in May and July 2018. Share Exchange Agreements On May 17, 2018, the Company entered into a Share Exchange Agreement (the “SEA”) with Marathon, ICC International Cannabis Corp (“ICC”) formerly known as Kaneh Bosm Biotechnology Inc. (“KBB”) and certain other sellers of Marathon capital stock. Under the SEA, the Company transferred 2.5 million shares in Marathon to ICC, a Company incorporated under the laws of the Province of British Columbia and a public reporting issuer on the Canadian Securities Exchange, in exchange for 5 million shares of ICC. The Company accounted for the exchange at fair value and recognized a gain on exchange of its investment in Marathon of $1,953,000 included in “Gains on exchange of equity investments” in the consolidated statements of operations. On July 16, 2018, the Company completed a Share Exchange Agreement (the “New SEA”) with Marathon, ICC, and certain other sellers of Marathon capital stock whereby the Company transferred its remaining one-half interest (2.5 million shares) in Marathon to KBB for an additional 5 million shares of ICC. The Company accounted for the exchange at fair value and recognized a gain on exchange of its investment in Marathon of $2,092,200 in the year ended December 31, 2018. The ten million shares of ICC owned by the Company constituted approximately 7% of the 141,219,108 shares of capital stock of KBB then issued and outstanding. The Company does not have the ability to exercise significant influence over ICC. The Company determined the fair value of both exchanges based on an actively quoted stock price of ICC received in exchange for the Marathon shares. The Company continues to fair value its investment in ICC with changes recognized in earnings each period and was recorded as an unrealized gain on exchange of investment during the nine months ended December 31, 2020 of $13,500. The value of the investments as of December 31, 2020 and December 31, 2019, was $0 and $33,000, respectively. Since no value was attributed to the 33 1/3% equity ownership interest in Marathon received as consideration for the distribution services, the Company would receive variable consideration in future for its services under the Distribution and Equity Acquisition Agreement, if certain milestones are achieved. Refer to Note 10 for the accounting associated with the cash of CAD $2 million received upfront. Variable consideration to be received in the future upon achieving the gross sales milestones described above, is constrained as the Company estimates that it is probable that a significant reversal of revenue could occur. In assessing the constraint, the Company considered its limited experience with the Products, new geographic markets and similar transactions, which affect the Company’s ability to estimate the likelihood of a probable revenue reversal. Therefore, no revenue has been recognized for the years ended December 31, 2020 and 2019. The Company will continue to reassess variable consideration at each reporting period and update the transaction price when it becomes probable that a significant revenue reversal would not occur. As of December 31, 2020, in addition to the 3,000,000 ICC shares valued at $0, as noted above, marketable securities also consisted of the following: 40,000 shares which traded at a closing price of $5.45 per share, or value of $218,183 of Diversa S.A. and 16,666 shares which traded at a closing price of $0.28 per share or value of $4,609 of National Bank of Greece. The Company recorded a net unrealized loss on the fair value of these investments of $2,246 during the year ended December 31, 2020. CosmoFarmacy LP In June 2019, the Company entered into an agreement with an unaffiliated third party to incorporate CosmoFarmacy L.P. for the purpose of providing strategic management consulting services and the retail trade of pharmaceutical products, OTC and beauty products to pharmacies. CosmoFarmacy was incorporated with a 30-year term through May 31, 2049. The unaffiliated third party is the general partner (the “GP”) of the limited partnership and is responsible for management and decision-making associated with CosmoFarmacy. The initial share capital was set to EUR 150,000 which was later increased to EUR 500,000. The GP contributed the pharmacy license (the “License”) valued at EUR 350,000 (30-year term) to operate the business of CosmoFarmacy in exchange for a 70% equity ownership. The Company is a limited partner and contributed cash of EUR 150,000 for the remaining 30% equity ownership. CosmoFarmacy is not publicly traded and the Company’s investment has been recorded using the equity method of accounting. The value of the investment as of December 31, 2020 and 2019, was $183,450 and $163,575, respectively, and is included in “Other assets” on the Company’s consolidated balance sheet. During the year ended December 31, 2019, the Company recognized a cash balance of $221,457 related to its acquisition of Cosmofarm. The cash was used to purchase the investment in CosmoFarmacy described above. Since the accounting for the acquisition of Cosmofarm was completed during the year ended December 31, 2018, the Company recognized the asset through earnings and is included in other income within the condensed consolidated statement of operations for the year ended December 31, 2019. |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 12 Months Ended |
Dec. 31, 2020 | |
PROPERTY AND EQUIPMENT, NET | |
NOTE 3 - PROPERTY AND EQUIPMENT, NET | Property, plant and equipment, net consists of the following at December 31: 2020 2019 Leasehold improvements $ 560,711 $ 548,000 Vehicles 105,057 115,055 Furniture, fixtures and equipment 1,632,654 1,439,839 Computers and software 149,005 85,052 2,447,427 2,187,946 Less: Accumulated depreciation (690,214 ) (453,165 ) Total $ 1,757,213 $ 1,734,781 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS NET | 12 Months Ended |
Dec. 31, 2020 | |
GOODWILL AND INTANGIBLE ASSETS NET | |
NOTE 4- GOODWILL AND INTANGIBLE ASSETS NET | Goodwill and intangible assets, net consist of the following at December 31,: 2020 2019 License $ 50,000 $ 50,000 Trade name /mark 36,997 36,997 Customer Base 176,793 176,793 263,790 263,790 Less: Accumulated amortization (82,981 ) (49,806 ) Subtotal 180,809 213,984 Goodwill 49,697 49,697 Total $ 230,506 $ 263,681 |
CAPITAL STRUCTURE
CAPITAL STRUCTURE | 12 Months Ended |
Dec. 31, 2020 | |
CAPITAL STRUCTURE | |
NOTE 5 - CAPITAL STRUCTURE | Preferred Stock The Company is authorized to issue 100 million shares of preferred stock, which have liquidation preference over the common stock and are non-voting. As of December 31, 2020 and 2019, no preferred shares have been issued. Common Stock The Company is authorized to issue 300 million shares of common stock. As of December 31, 2020 and 2019, the Company had 13,485,128 and 13,325,587 shares of our common stock issued and 13,069,800 and 12,860,059 shares outstanding, respectively. On January 7, 2019 and February 5, 2019, 465,325 and 108,417, respectively, shares of common stock were cancelled, these shares were the remaining pre-delivery shares related to the convertible notes in Note 9. Purchase of Treasury Shares On November 30, 2018, the Company entered into a stock purchase agreement with an officer and director of the Company, whereby for consideration of $60,000, the Company repurchased 20,000 shares of its common stock at $3.00 per share. As per the agreement, the sale and transfer of the shares occurred on November 30, 2018, the date of signing, however the Company is entitled to pay the full consideration in tranches until August 2019. During the year ended December 31, 2018, the Company paid consideration of $11,317 and had a related party payable of $48,683, which was paid in full during the year ended December 31, 2019. On February 5, 2019, the Company entered into a Stock Purchase Agreement (the “SPA”) with an institutional noteholder. The SPA provides for the Company’s purchase of 193,408 shares of the Company’s common stock at $3.00 per share or an aggregate of $580,224. Payment was scheduled over a five-month period, subject to acceleration if the Company effects an eligible equity offering. As of December 31, 2019, the Company had made $580,224 in payments. All of the 193,408 shares have been transferred back to the Company and cancelled. On February 18, 2019, the Company entered into a Stock Purchase Agreement (the “SPA”) with an institutional noteholder. The SPA provides for the Company’s purchase of 83,341 shares of the Company’s common stock at $3.00 per share or an aggregate of $250,023. Payment was scheduled over a five-month period, subject to acceleration, if the Company effects an eligible equity offering. As of December 31, 2019, the Company had made $250,023 in payments. 26,221 shares were transferred back to the Company and subsequently cancelled. The additional 57,120 were transferred to the Company, have not yet been cancelled, and are recorded in treasury. On June 20, 2019, the Company entered into a stock purchase agreement with a former officer and director of Decahedron, whereby for consideration of $15,000, the Company repurchased 114,518 shares of its common stock. As per the agreement, the sale and transfer of the shares occurred on June 20, 2019, the date of signing. During the year ended December 31, 2019, the Company paid consideration of $15,000. On July 31, 2020, the Company entered into a Stock Purchase Agreement (the “July SPA”) with a shareholder. The July SPA provides for the Company’s purchase of 10,000 shares of the Company’s common stock at $4.00 per share or an aggregate of $40,000. As of December 31, 2020, the Company made $40,000 in payments. On August 31, 2020, the Company entered into two Stock Purchase Agreements (the “August SPAs”) with a shareholder. The August SPAs provide for the Company’s purchase of an aggregate total of 10,000 shares of the Company’s common stock at $4.00 per share or an aggregate of $40,000. As of December 31, 2020, the Company made $40,000 in payments. On September 30, 2020, the Company entered into a Stock Purchase Agreement (the “July SPA”) with a shareholder. The July SPA provides for the Company’s purchase of 10,000 shares of the Company’s common stock at $4.00 per share or an aggregate of $40,000. As of December 31, 2020, the Company made $40,000 in payments. On October 31, 2020, the Company entered into a Stock Purchase Agreement (the “July SPA”) with a shareholder. The July SPA provides for the Company’s purchase of 10,000 shares of the Company’s common stock at $4.00 per share or an aggregate of $40,000. As of December 31, 2020, the Company made $40,000 in payments. On November 30, 2020, the Company entered into a Stock Purchase Agreement (the “July SPA”) with a shareholder. The July SPA provides for the Company’s purchase of 10,000 shares of the Company’s common stock at $4.00 per share or an aggregate of $40,000. As of December 31, 2020, the Company made $40,000 in payments. Potentially Dilutive Securities No options warrants or other potentially dilutive securities other than those disclosed above have been issued as of December 31, 2020. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2020 | |
INCOME TAXES | |
NOTE 6 - INCOME TAXES | The domestic and foreign components of income (loss) before (benefit) provision for income taxes were as follows (in thousands): 12/31/2020 12/31/2019 Domestic $ (2,901,276 ) $ (2,515,360 ) Foreign 4,099,597 (600,790 ) $ 1,198,321 $ (3,116,150 ) The components of the (benefit) provision for income taxes are as follows (in thousands): 12/31/2020 12/31/2019 Current tax provision Federal $ - $ - State - - Foreign 555,965 182,815 Total current tax provision $ 555,965 $ 182,815 Deferred tax provision Domestic $ - $ - State - - Foreign (178,430 ) - Total deferred tax provision $ (178,430 ) $ - Total current provision $ 377,535 $ 182,815 The reconciliation of income tax expense computed at the U.S. federal statutory rate to the income tax provision for the years ended December 31, 2020 and 2019 is as follows: 12/31/2020 12/31/2019 US Income (loss) before income taxes $ 1,198,321 $ (3,116,150 ) Taxes under statutory US tax rates $ 251,647 $ (654,391 ) Increase (decrease) in taxes resulting from: Increase in valuation allowance $ 216,518 $ 1,521,175 Foreign tax rate differential $ (55,540 ) $ 9,028 Permanent differences $ (218,216 ) $ 94,520 US tax on foreign income $ 604,419 $ - Prior period adjustments $ (97,829 ) $ (713,466 ) State taxes $ (323,464 ) $ (74,051 ) Income tax expense $ 377,535 $ 182,815 Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and amounts used for income tax purposes. Significant components of the Company’s deferred tax assets and liabilities consist of the following: 12/31/2020 12/31/2019 Net operating loss carryforward $ 1,494,424 $ 1,270,650 Capital loss carryforward 801,744 801,744 Nonqualified stock options 170,297 184,545 Accrued expenses 7,389 7,389 Lease liability 247,797 - Gain on extinguishment of debt 179,958 - Depreciation 4,226 2,418 Mark to market adjustment in securities 357,829 348,422 Total deferred tax assets 3,263,664 2,615,168 Intangibles (10,729 ) (10,729 ) Right of use asset (253,818 ) Goodwill (14,473 ) (14,473 ) Total deferred tax liabilities (279,020 ) (25,202 ) Valuation allowance (2,806,214 ) (2,589,966 ) Net deferred tax assets (liabilities) $ 178,430 $ - At December 31, 2020, the Company had U.S. net operating loss ("NOL") carryforwards of approximately 4,112,907 that may be offset against future taxable income, subject to limitation under IRC Section 382. Of the $4.1 million Federal NOL carryforwards, $2.5 million are pre-2018 and begin to expire in 2031. The remaining balance of $1.6 million, are limited to utilization of 80% of taxable income but do not have an expiration. At December 31, 2020, the Company had fully utilized all non-US NOL carryforwards. A tax benefit has been reported in the December 31, 2020 for the release of the non-US valuation allowance, based on a more likely than not criterion and in consideration of all available positive and negative evidence. The Company applied the “more-likely-than-not” recognition threshold to all tax positions taken or expected to be taken in a tax return, which resulted in no unrecognized tax benefits as of December 31, 2020 and December 31, 2019, respectively. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2020 | |
RELATED PARTY TRANSACTIONS | |
NOTE 7 - RELATED PARTY TRANSACTIONS | On the date of our inception, we issued 2 million shares of our common stock to our three officers and directors which were recorded at no value (offsetting increases and decreases in common stock and additional paid-in capital). Doc Pharma S.A. As of December 31, 2020, the Company has a prepaid balance of $3,468,653 to Doc Pharma S.A. related to purchases of inventory. Additionally, the Company has a receivable balance of $3,468,564. As of December 31, 2019, the Company has a prepaid balance of $2,449,484 and an accounts payable balance of $25,346, resulting in a net prepaid balance of $2,424,138 to Doc Pharma S.A. related to purchases of inventory. Additionally, the Company has a receivable balance of $613,264. During the years ended December 31, 2020 and 2019, the Company purchased a total of $5,983,809 and $3,464,725 of products from Doc Pharma S.A., respectively. During the years ended December 31, 2020 and 2019 the Company had $2,843,260 and $873,041 revenue from Doc Pharma S.A., respectively. Doc Pharma S.A is considered a related party to the Company due to the fact that the CEO of Doc Pharma is the wife of Grigorios Siokas, the Company’s CEO and principal shareholder, who also served as a principal of Doc Pharma S.A. in the past. Notes Payable – Related Party A summary of the Company’s related party notes payable during the years ended December 31, 2020 and 2019 is presented below: 2020 2019 Beginning Balance $ 1,375,532 $ 1,793,437 Payments (996,136 ) (382,055 ) Foreign currency translation 122,279 (35,850 ) Ending Balance $ 501,675 $ 1,375,532 Grigorios Siokas On December 20, 2018, the €1,500,000 ($1,718,400) note payable, originally borrowed pursuant to a Loan Agreement with a third-party lender, dated March 16, 2018, was transferred to Grigorios Siokas. The note bears an interest rate of 4.7% per annum and matured on March 18, 2019 pursuant to the original agreement. The note is not in default and the maturity date has been extended until December 31, 2021. As of December 31, 2019, the note had an outstanding principal balance of €1,200,000 ($1,347,240) and accrued interest of €144,207 ($128,447). During the year ended December 31, 2020 the Company repaid €800,000 ($978,400). As of December 31, 2020, the Company has an outstanding balance of €400,000 ($489,200) and accrued interest of €158,287 ($193,585). Grigorios Siokas is the Company’s CEO and principal shareholder. Dimitrios Goulielmos On November 21, 2014, the Company entered into an agreement with Dimitrios Goulielmos, as amended on November 4, 2016. Pursuant to the amendment, this loan has no maturity date and is non-interest bearing. During the year ended December 31, 2019, the Company repaid €40,300 ($45,245) and a principal balance of €13,200 ($14,820) remained as of December 31, 2019. During the year ended December 31, 2020, the Company repaid €3,000 ($3,669) and a principal balance of €10,200 ($12,475) remained as of December 31, 2020. Dimitrios Goulielmos is a current director and former CEO of the Company. DOC Pharma On November 1, 2015, the Company entered into a €12,000 ($12,662) Loan Agreement with Doc Pharma S.A, pursuant to which Doc Pharma S.A., paid existing bills of the Company in the amount of €12,000 ($12,662), excluding the Vendor Bills. The loan bears an interest rate of 2% per annum and was due and payable in full on October 31, 2016. As of December 31, 2019, the Company has an outstanding principal balance of €12,000 ($13,472) and accrued interest expense of $1,100. On December 18, 2020, the Company repaid the principal of this loan. As of December 31, 2020, the Company has an outstanding principal balance of $0 and accrued interest expense of $1,364. The above balances are adjusted for the foreign currency rate as of the balance sheet date. For the years ended December 31, 2020 and 2019, the Company recorded a foreign currency translation gain of $122,279 and a loss of $35,850 respectively. Loans Payable – Related Party A summary of the Company’s related party loans payable during the years ended December 31, 2020 and 2019 is presented below: 2020 2019 Beginning Balance $ 1,026,264 $ 1,775,251 Proceeds 725,563 585,915 Payments (149,695 ) (262,226 ) Conversion of debt - (1,050,000 ) Reclassification of receivable - 2,547 Foreign currency translation 27,114 (25,223 ) Ending Balance $ 1,629,246 $ 1,026,264 Grigorios Siokas From time-to-time Grigorios Siokas loans the Company funds in the form of non-interest bearing, no-term loans. As of December 31, 2018, the Company had an outstanding principal balance of $1,777,799, consisting of €1,353,700 ($1,550,799) and $227,000, in loans payable to Grigorios Siokas. During the year ended December 31, 2019, the Company borrowed total additional proceeds of $585,914, repaid €233,567 ($262,226) of these loans and converted $1,050,000 of these loans into 140,001 shares of common stock at a conversion rate of $7.50 per share (see below). As of December 31, 2019, the Company had an outstanding principal balance under these loans of $1,026,264 consisting of €297,314 ($303,502) and $722,762, in loans payable to Grigorios Siokas. During the year ended December 31, 2020, the Company borrowed additional proceeds of €266,200 ($325,563) and $400,000 and repaid €122,400 ($149,695) of these loans. As of December 31, 2020, the Company had an outstanding balance under these loans of $1,629,246. On May 28, 2019, the Company entered into a Debt Exchange Agreement with Grigorios Siokas. The agreement provided for the issuance by the Company of 66,667 shares of common stock, at the rate of $7.50 per share, or an aggregate of $500,000, in exchange for $500,000 of existing loans by Mr. Siokas to the Company. The Company valued this transaction at fair value and recorded a $259,999 gain on extinguishment of related party debt to additional paid-in capital. On June 24, 2019, the Company entered into a Debt Exchange Agreement with Grigorios Siokas. The agreement provided for the issuance by the Company of 73,334 shares of common stock, at the rate of $7.50 per share, or an aggregate of $550,000, in exchange for $550,000 of existing loans by Mr. Siokas to the Company. The Company valued this transaction at fair value and recorded a $269,126 gain on extinguishment of related party debt to additional paid-in capital. The above balances are adjusted for the foreign currency rate as of the balance sheet date. For the years ended December 31, 2020 and 2019, the Company recorded $30,954 and $25,223, respectively. Except as set forth above, we have not entered into any material transactions with any director, executive officer, and promoter, beneficial owner of five percent or more of our common stock, or family members of such persons. |
LINES OF CREDIT
LINES OF CREDIT | 12 Months Ended |
Dec. 31, 2020 | |
LINES OF CREDIT | |
NOTE 8 - LINES OF CREDIT | A summary of the Company’s lines of credit during the years ended December 31, 2020 and 2019 is presented below: 2020 2019 National $ 3,540,550 $ 1,940,045 Alpha 1,106,894 810,947 National - COVID 429,240 - Total $ 5,076,684 $ 2,750,992 The line of credit with National Bank of Greece is being renewed annually with current interest rates of 6.00%, 4.35% (“COSME 2”) and 4.35% (plus the 6-month Euribor plus any contributions currently in force by law on certain lines of credit), (“COSME 1”). The maximum borrowing allowed for the 6% line of credit was $2,690,600 and $1,684,050 at December 31, 2020 and December 31, 2019, respectively for the 6% line of credit. The outstanding balance was $2,411,182 and $973,961 at December 31, 2020 and 2019, respectively. The maximum borrowing allowed was $1,223,000 and $1,122,700 at December 31, 2020 and December 31, 2019, respectively, for the 4.35% lines of credit. The outstanding balance was $1,129,368 and $966,084 at December 31, 2020 and December 31, 2019, respectively. The line of credit with Alpha Bank of Greece is renewed annually with a current interest rate of 6.00%. The maximum borrowing allowed was $1,223,000 and $1,122,700 at December 31, 2020 and December 31, 2019, respectively. The outstanding balance was $1,106,894 and $810,947 at December 31, 2020 and December 31, 2019, respectively. In the year ended December 31, 2018, the Company had a line of credit with Eurobank of Greece which had an interest rate of 8.55% and a maximum borrowing allowed of $572,800. The outstanding balance was $286,829 at December 31, 2018 and was paid back in full during the year ended December 31, 2019. Interest expense for the year ended December 31, 2020 and 2019, was $270,655 and $85,090, respectively. Under the agreements, the Company is required to maintain certain financial ratios and covenants. These lines of credit were assumed in the Company’s acquisition of Cosmofarm. During the years ended December 31, 2020 and 2019, the Company was in compliance with these ratios and covenants. COVID-19 Government Funding On June 23, 2020, the Company’s subsidiary Cosmofarm M.S. entered into an agreement with the “National Bank of Greece SA” (the “Bank”) to borrow a maximum of €500,000 ($611,500) under a proposed plan which will operate the same as the line of credit above. The proposed plan has a maturity date of sixty (60) months from the date of the first disbursement, which includes a grace period of nine months. The total amount of the initial proceeds were paid in 3 equal monthly installments. The Company received the first disbursement of €390,790 ($483,243) on July 10, 2020, the second disbursement in the amount of €42,385 ($48,639) was received on July 28, 2020 and the final disbursement of €66,825 ($75,091) on August 11, 2020. The line of credit is interest bearing from the date of receipt and is payable every three (3) months at an interest rate of 2.7%. The outstanding balance was $429,240 at December 31, 2020. Interest expense for year ended December 31, 2020 was $3,910. |
CONVERTIBLE DEBT
CONVERTIBLE DEBT | 12 Months Ended |
Dec. 31, 2020 | |
CONVERTIBLE DEBT | |
NOTE 9 - CONVERTIBLE DEBT | A summary of the Company’s convertible debt during the years ended December 31, 2020 and 2019 is presented below: 2020 2019 Beginning balance notes 1,500,000 365,513 New notes 540,000 1,500,000 Payments (593,000 ) (365,513 ) Subtotal notes 1,447,000 1,500,000 Debt discount at year end (494,973 ) (29,509 ) Convertible debt, net of discount 952,027 1,470,491 All of the convertible debt is classified as short-term within the consolidated balance sheet as it all matures and will be paid back within fiscal year 2021. November 15, 2017 Securities Purchase Agreement On November 15, 2017, the Company entered into a Securities Purchase Agreement with institutional investors (the “Buyers”), pursuant to which the Company issued on November 16, 2017 for a purchase price of $3,000,000, $3,350,000 in aggregate principal amount of Senior Convertible Notes (the “Existing Notes”) to the Buyers, convertible into approximately 670,000 shares of the Company’s common stock, par value $0.001 per share (the “Common Stock”) at $5.00 per share and five-year warrants (the “Warrants”) to purchase an aggregate of 536,000 shares of Common Stock exercisable at $7.50 per share. The Notes contained an original issue discount of $350,000. Of the $3,000,000 purchase price, $240,000 went directly to financing costs (see below) and $74,000 went directly to legal fees such that the Company received net proceeds of $2,686,000. On February 20, 2018, the Company entered into two separate Amendment and Exchange Agreements (“Exchange Agreements”) with the Buyers for new senior convertible notes (“New Notes”) in exchange for existing notes. Each New Note is identical in all material respects to the Existing Note, except that (i) the New Note was not convertible into shares of the Company’s common stock (the “Common Stock”) until April 20, 2018; (ii) all future cash installment payments under such New Note will be made at a redemption price equal to 112% of the applicable installment amount; (iii) the Company’s existing obligation to initially deliver pre-delivery shares of its common stock to the holder of such New Note was deferred until April 20, 2018; and (iv) at any time on or before June 20, 2018, the Company had the right, at its option, to redeem all, or any part, of the amounts then outstanding under such New Note in cash at a redemption price equal to 125% of such amounts then outstanding under such New Note. The Company will repay the principal amount of the Notes in equal monthly installments beginning on January 1, 2018 and repeating on the first business day of each calendar month thereafter until the fourteenth (14th) month anniversary date of issue. On September 26, 2018, the Company entered into a second amendment which extended the maturity dates of the notes to February 1, 2019. On April 24, 2018, 670,001 pre-delivery shares were issued. On January 7, 2019 and February 5, 2019, 465,625 and 108,417 pre-delivery shares, respectively, were cancelled upon full payment of both notes. Eighty-five (85%) percent of any cash proceeds received by the holders of the Notes from the sale of pre-delivery shares issued as collateral shall be applied against the particular installment amount then due. The Notes are senior in right of payment to all existing and future indebtedness except Permitted Indebtedness which includes $12 million of senior secured indebtedness of the Company and its subsidiaries under the above described Synthesis loan agreements, plus a defined amount of purchase money indebtedness in connection with bona fide acquisitions. The Company evaluated the debt modification in accordance with ASC 470-50 and concluded that the debt qualified for debt extinguishment as the 10% cash flow test was met. As a result, the Existing Notes were written off and the New Notes were recorded at fair value as of February 20, 2018. The Company wrote off the remaining principal balance of $2,871,429 of the Existing Notes along with the remaining $2,596,838 of debt discounts related to the Existing Notes of which $1,140,711 was a reduction to additional paid-in-capital representing the intrinsic value of the existing beneficial conversion feature. The Company recorded the New Notes in the amount of $3,216,000 and a total debt discount of $3,216,000 in relation to the intrinsic value of the new beneficial conversion feature of $2,880,000 and an original issue discount of $336,000. This resulted in a net loss on extinguishment of debt in the amount of $1,464,698 and additional net equity related to the beneficial conversion feature of $1,739,289. The New Notes were not convertible until April 18, 2018 pursuant to the February 20, 2018 amendment. Beginning April 20, 2018, the Holder may convert the New Notes into shares of Common Stock at the rate of $5.00 per share. In the event of an issuance of Common Stock for a consideration less than the Conversion Price (other than Excluded Securities, as defined) the Conversion Price shall be reduced to the price of the dilutive issuance, (the “Conversion Price”). Upon an Event of Default (as defined), the Buyers may convert at an alternative conversion price equal to the lower of the then applicable Conversion Price or seventy-five (75%) percent of the Volume-Weighted Average Price (as defined, the “VWAP”). The Company valued the beneficial conversion feature of the Existing Notes at intrinsic value and recorded $1,140,711 to debt discount, of which $405,743 was amortized through February 19, 2018. On February 20, 2018, the remaining debt discount was written off and the Company recorded a new debt discount as discussed above. On December 12, 2018, the Company entered into a Third Amendment and Exchange Agreement (“Third Exchange Agreement”) with the Buyers whereby the existing 536,000 warrants issued to such investors in connection with the November 15, 2017 Securities Purchase Agreement were retired in exchange for 727,683 new warrants. Additionally, the investors agreed to convert $1,333,333 of the debt related to the September 4, 2018 Securities Purchase Agreement at a reduced conversion price of $3.478. The Company issued those 383,363 shares on December 13, 2018. The Third Exchange agreement was considered to be an inducement to conversion and accounted for in accordance with ASC 470-20. Accordingly, the Company recorded a modification expense of $1,778,952 for the year ended December 31, 2018. During the year ended December 31, 2018, there were principal conversions in the amount of $432,419 and the Company repaid principal on the New Notes in the amount of $2,680,000, such that the remaining outstanding principal balance of the New Notes as of December 31, 2018 was $103,610. The Company repaid this remaining balance in the year ended December 31, 2019. The Company recorded a total of $3,350,000 of debt discounts related to the above Existing Notes in the year ended December 31, 2017. A total of $360,890 was amortized during the year ended December 31, 2017 and an additional $392,272 related to the debt discount of the Existing Notes was amortized through February 19, 2018. As a result of the Exchange Agreement discussed above, the debt discounts of the Existing Notes were written off and a total of $3,216,000 of debt discounts were recorded during the year ended December 31, 2018. The debt discounts are being amortized over the term of the debt. Amortization of the debt discounts of the New Notes for the year ended December 31, 2018 was $3,170,386. The additional $45,613 was amortized in the year ended December 31, 2019. September 4, 2018 Securities Purchase Agreement On September 4, 2018, the Company entered into a Securities Purchase Agreement with two institutional investors (the “Buyers”) pursuant to which the Company issued for a purchase price of $2,000,000, $2,233,333 in aggregate principal amount of Senior Convertible Notes (the “September 2018 Notes”) to the Buyers, convertible into 372,223 shares of the Company’s common stock, par value $.001 per share at $6.00 per share (with the exception of the conversion related to the Third Exchange Agreement), and warrants to purchase an aggregate of 357,334 shares of Common Stock exercisable at $7.50 per share (the “Warrants”). The Notes contained an original issue discount of $233,332. Of the $2,000,000 purchase price, $140,000 went directly to financing costs (see below) and $15,000 went directly to legal fees such that the Company received net proceeds of $1,845,000. The September 2018 Notes provide that the Company will repay the principal amount of Notes in equal monthly installments including a 5% installment fee, which is recorded as interest expense, beginning on November 1, 2018 and repeating on the first business day of each calendar month thereafter until May 1, 2019. During the year ended December 31, 2018, the Company recorded $31,905 in installment fees. During the year ended December 31, 2019, the Company recorded $13,097 in installment fees. The Notes were convertible at any time by the Holder into shares of Common Stock at the rate of $6.00 per share (with the exception of the conversion pursuant to the Third Exchange Agreement described below), subject to full ratchet anti-dilution adjustment (the “Conversion Price”). According to the original terms of the agreement, the Company was to pre-deliver up to 372,222 shares of common stock to the Buyers. Eighty-five percent (85%) of any cash proceeds received by the Buyers from the sale of the Pre-Delivery Shares would then be applied against the particular installment amount due on such Installment Date under the Note. The Company had three months to deliver the Pre-Delivery shares, however the debt was repaid prior to the opportunity to deliver those shares. The Registration Statement (No. 333-227813) covering 150% of the number of shares underlying the Notes and warrants was declared effective on November 1, 2018. Upon an Event of Default (regardless of whether such event has been cured), the Buyers may convert at an alternative conversion price equal to the lower of the then applicable Conversion Price or seventy-five (75%) percent of the then Volume-Weighted Average Price (as defined, the “VWAP”). The Company valued the beneficial conversion feature of the Existing Notes at intrinsic value and recorded $934,922 to debt discount, which will be amortized over the life of the Notes. Roth Capital Partners, LLC (“Roth”), as the Company’s exclusive placement agent, received a cash commission for this transaction equal to seven (7%) percent of the total gross proceeds of the offering, or $140,000, and the issuance of five-year warrants to purchase seven (7%) percent of the shares of common stock issued or issuable in this offering (excluding shares of Common Stock issuable upon exercise of any Warrants issued to investors), or 26,056 shares; and will receive seven (7%) percent of any cash proceeds received from the exercise of any Warrants sold in the offering with an expiration equal to or less than twenty-four (24) months. The warrants are exercisable six months after the issue date or March 4, 2019, at $6.00 per share and were valued at a fair value of $157,969 which was fully expensed during the year ended December 31, 2018. The $140,000 cash commission was recorded as debt discount and will be amortized over the term of the Notes. During the year ended December 31, 2018, there were principal conversions in the amount of $1,333,333 at a conversion price of $3.478 pursuant to the Third Exchange Agreement and the Company repaid principal of $638,095, such that the remaining outstanding principal balance of the Notes as of December 31, 2018 was $261,903. During the year ended December 31, 2019, the Company repaid the remaining principal balance in the amount of $261,903, such that the remaining outstanding principal balance of the Notes as of December 31, 2019 is zero. The Company recorded a total of $2,233,332 of debt discounts related to the above Notes during the year ended December 31, 2018. The debt discounts are being amortized over the term of the debt. Amortization of the debt discounts for the year ended December 31, 2018 was $2,049,232. As a result of the final payment of the Notes, the remaining debt discount of $184,100 was amortized during the year ended December 31, 2019. Securities Purchase Agreement executed on May 15, 2019 On May 15, 2019, the Company entered into a Securities Purchase Agreement with an institutional investor (the “Buyer”). Upon the closing of this financing, on May 17, 2019, the Company issued for a purchase price of $1,500,000 in principal amount a Senior Convertible Note (the “May 2019 Note”) to the Buyer. The May 2019 Note provided that the Company will repay the principal amount of the May 2019 Note on or before March 15, 2020. On March 23, 2020, the Company entered into a Forbearance and Amendment Agreement (the “Agreement”) with an institutional investor (the “Buyer”). The Agreement provides that the Buyer will (a) forbear (i) from taking any action with respect to the Existing Default and (ii) from issuing any demand for redemption of the Note on the basis of the Existing Default until the earlier of: (1): (September 16, 2020 (or, if earlier, such date when all amounts outstanding under the Note shall be paid in full or converted into shares of Common Stock in accordance therewith) and (2) the time of any breach by the Company of the Agreement or the occurrence of an Event of Default that is not an Existing Default (the “Forbearance Expiration Date”), (b) during the Forbearance Period waive the prepayment premium to any Company Optional Redemption, and (c) during the Forbearance Period, waive the repayment in full of the Note other than the Required Payments (as defined) prior to September 16, 2020. The Scheduled Required Prepayments are $100,000 upon signing the Agreement and five (5) monthly payments thereafter aggregating $200,000 with all amounts outstanding under the Note due on September 16, 2020. In addition, there are mandatory prepayments in the event the Company completes a Subsequent Placement (as defined) or long-term debt (other than from the Buyer or from officers and directors and advisors of the Company) or factoring and purchase order indebtedness, the Company shall effect a Company Optional Redemption amount equal to 50% of the gross proceeds (less reasonable expenses of counsel and any investment bank) together with all Scheduled Required Payments. On September 23, 2020, the Company entered into a Second Forbearance and Amendment Agreement (the “Agreement”) with an institutional investor (the “Buyer”). The Note was due to be paid in full on or before September 16, 2020 and was not paid (the “Existing Default”). The Note provides that upon an Event of Default, the Buyer may, among other things, require the Company to redeem all or a portion of the Note at a redemption premium of 120%, multiplied by the product of the conversion rate ($6.00per share) and the then current market price. The Agreement provides that the Buyer will (a) forbear (i) from taking any action with respect to the Existing Default and (ii) from issuing any demand for redemption of the Note on the basis of the Existing Default until the earlier of: (1): June 16, 2021 (or, if earlier, such date when all amounts outstanding under the Note shall be paid in full or converted into shares of Common Stock in accordance therewith) and (2) the time of any breach by the Company of the Agreement or the occurrence of an Event of Default that is not an Existing Default (the “Forbearance Expiration Date), (b) during the Forbearance Period (as defined) waive the prepayment premium to any Company Optional Redemption (which will result in the 120% redemption premium effectively replaced with 100%), and (c) during the Forbearance Period, waive the repayment in full of the Note other than the Required Payments (as defined) prior to June 16, 2021. The Scheduled Required Prepayments are $63,000 upon signing the Agreement and eight (8) monthly payments thereafter aggregating $480,000 with the remaining $607,000 outstanding under the Note due on June 16, 2021. In addition, there are mandatory prepayments in the event the Company completes a Subsequent Placement (as defined) or long-term debt (other than from the Buyer or from officers, directors and 10% or greater shareholders of the Company) or factoring and purchase order indebtedness, the Company shall effect a Company Optional Redemption amount equal to 50% of the gross proceeds (less reasonable expenses of counsel and any investment bank) together with all Scheduled Required Payments. The May 2019 Note is convertible at any time by the Holder into 250,000 shares of common stock, par value $0.001 per share at the rate of $6.00 per share, subject to adjustment (the “Conversion Price”). Upon an Event of Default (regardless of whether such event has been cured), the Buyer may convert at an alternative conversion price equal to the lower of the then applicable Conversion Price or seventy-five (75%) percent of the then Volume-Weighted Average Price (as defined, the “VWAP”). The Company considered the need for the conversion feature to be bifurcated under ASC 815 and determined that it does not meet the requirements. Additionally, the Company determined the effective conversion rate under ASC 470-20 and determined that the instrument is out of the money and no beneficial conversion feature was recorded. The May 2019 Note is senior in right of payment to all other existing and future indebtedness of the Company except Permitted Senior Indebtedness (as defined in the May 2019 Note), including $12 million of senior secured indebtedness of the Company and its subsidiaries under an existing senior loan agreement, plus defined amounts of purchase money indebtedness in connection with bona fide acquisitions. The May 2019 Note includes customary Events of Default and provides that the Buyer may require the Company to redeem (regardless of whether the Event of Default has been cured) all or a portion of the Note at a redemption premium equal to the greater of: (i) the product of the redemption premium of one hundred twenty-five (125%) percent, multiplied by the conversion amount, and (ii) the product of the conversion rate ($6.00 per share) multiplied by the product of 125% multiplied by the then current market price. The Buyer may also require redemption of the May 2019 Note upon a Change of Control (as defined) at a premium of one hundred twenty-five (125%) percent. The Company has the right to redeem the May 2019 Note at any time, in whole or in part, in cash at a price equal to 120% of the then outstanding conversion amount. Conversion of the May 2019 Note is subject to a blocker provision which prevents any holder from converting the May 2019 Note into shares of common stock if its beneficial ownership of the common stock would exceed 9.99% of the Company’s issued and outstanding common stock. As of December 31, 2019, the Company had a principal balance $1,500,000 on the May 2019 Note and the Company had accrued $25,334 in interest expense. During the year ended December 31, 2020, the Company repaid $593,000 such that as of December 31, 2020, the Company had a principal balance $907,000 on the May 2019 Note and the Company had accrued $15,420 in interest expense. Roth Capital Partners, LLC (“Roth”), as the Company’s exclusive placement agent, received a cash commission for this transaction equal to six (6%) percent of the total gross proceeds of the offering. This 6% fee or $90,000 was recorded as debt discount along with the $30,000 in legal fees associated with the May 2019 Note. These fees will be amortized over the term of the note. The Company amortized $90,491 in the year ended December 31, 2019 and the remaining $29,509 was amortized during the year ended December 31, 2020. December 21, 2020 Securities Purchase Agreement On December 21, 2020 (the “Issue Date”), Cosmos Holdings, Inc. (“Cosmos”, the “Borrower” or the “Company”) entered into a convertible promissory note with Platinum Point Capital, LLC (the “Holder”, “Lender” or “Platinum”). The Company issued the $540,000 Note in exchange for $500,000 in cash and included a $40,000 Original Issue Discount (“OID”) and paid $3,000 in financing costs. The principal amount together with interest at the rate of eight percent (8.0%) per annum, compounded annually (the “Interest Rate”), will be paid to the Lenders on or before the Maturity Date (December 31, 2021 or as defined below). Accrued interest shall be calculated on the basis of a 360-day year for the actual number of days elapsed. In the event that on or before the Maturity Date, the Note either (i) have not been converted or have not been otherwise satisfied in full or (ii) an Event of Default occurs, then the applicable rate of interest on the outstanding amount of the Note since inception shall be the Interest Rate plus eighteen percent (18.0%), the Default Interest. Unless previously converted, the principal and accrued interest on the Note is due and payable in cash (USD) upon the earlier of (i) December 31, 2021, (ii) a Change of Control (as defined below) or (iii), an Event of Default (as defined below) (collectively, the “Maturity Date”). The Note may be prepaid in whole or part beginning from the issue date until a date not later than 180 days thereafter, the Company shall have the right to prepay the full amount outstanding under the Note (principal and accrued interest), in full by making a payment to the Holder in an amount equal to one hundred twenty (120%) multiplied by the sum of (w) the then outstanding principal amount of this Note plus (x) accrued and unpaid interest on the unpaid principal amount of the Note plus (y) Default Interest, if any. The Holder shall have the right at any time from the Issue Date to convert all or part of the outstanding and unpaid principal amount of the Note into Common Stock at the Conversion Price of as defined below. a) The Conversion Price b) Conversion upon Qualified Financing c) Conversion Price During Major Announcements The Company determined that the embedded conversion feature of the convertible promissory note meets the definition of a beneficial conversion feature and a derivative liability which is accounted for separately. The Company measured the beneficial conversion feature’s intrinsic value on December 16, 2020 and determined that the embedded derivative was valued at $456,570 which was recorded as a debt discount, and together with the original issue discount and transaction expenses of $43,000, in the aggregate of $499,570, is being amortized over the life of the loan. As of December 31, 2020, the fair value of the derivative liability was $460,728 and for the year ended December 31, 2020 the Company recorded a loss of $4,158 from the change in fair value of derivative liability as other expense in the consolidated statements of operations and comprehensive income (loss). Derivative Liabilities The table below provides a summary of the changes in fair value, including net transfers in and/or out of all financial liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the year ended December 31, 2020: Amount Balance on December 31, 2019 $ - Issuances to debt discount 456,570 Change in fair value of derivative liabilities 4,158 Balance on December 31, 2020 $ 460,728 The fair value of the derivative conversion features and warrant liabilities as of December 31, 2020 were calculated using a Monte-Carlo option model valued with the following assumptions: December 31, Dividend yield 0 % Expected volatility 140.4%-142.5 % Risk free interest rate 0.11%-0.12 % Contractual terms (in years) 1.00 – 1.04 |
DEBT
DEBT | 12 Months Ended |
Dec. 31, 2020 | |
DEBT | |
NOTE 10 - DEBT | A summary of the Company’s third-party debt during the years ended December 31, 2020 and 2019 is presented below: December 31, 2020 Loan Facility Bridge Loans Trade Facility Third Party COVID Loans Total Beginning balance 3,078,442 191,287 6,245,400 2,514,595 - 12,029,724 Proceeds - - - 16,121,500 435,210 16,556,710 Payments - (191,287 ) - (5,006,115 ) - (5,230,725 ) conversion of debt (807,795 ) (807,795 ) Debt extinguishment (12,066 ) - - (192,205 ) - (204,271 ) Foreign currency translation 269,047 - 200,600 1,304 - 470,951 Reclass of long-term portion of debt (10,771,882 ) Ending Balance 3,302,100 - 6,446,000 12,631,284 435,210 12,042,712 December 31, 2019 Loan Facility Bridge Loans Trade Facility Third Party Total Beginning balance $ 3,078,442 $ 191,287 $ 6,291,199 $ 242,805 $ 9,803,733 Proceeds - - - 2,500,000 2,500,000 Payments - - - (227,912 ) (227,912 ) Foreign currency translation - - (45,799 ) (298 ) (46,097 ) Ending Balance $ 3,078,442 $ 191,287 $ 6,245,400 $ 2,514,595 $ 12,029,724 On November 16, 2015, the Company entered into a Loan Agreement with Panagiotis Drakopoulos, former Director and former Chief Executive Officer, pursuant to which the Company borrowed €40,000 ($42,832) as a note payable from Mr. Drakopoulos. The note bears an interest rate of 6% per annum and was due and payable in full on November 15, 2016. As of December 31, 2019, the Company had an outstanding principal balance of €13,000 ($14,595) and accrued interest of €4,166 ($4,677). During the year ended December 31, 2020, the Company repaid €5,000 ($5,862) of this loan. As of December 31, 2020, the Company had an outstanding principal balance of €8,000 ($9,784) and accrued interest of €4,785 ($5,852). On December 19, 2018, pursuant to the terms of the Cosmofarm SPA (See Note 1), the Company issued a non-interest-bearing promissory note in the amount of €200,000 ($227,912). The note had a maturity date of December 19, 2019. The Company had an outstanding balance of €200,000 ($227,912) as of December 31, 2018. During the year ended December 31, 2019, the Company repaid the outstanding balance of the note. Loan Facility Agreement and Bridge Loans Loan Facility On August 4, 2016, the Company’s wholly owned subsidiary SkyPharm entered into a Loan Facility Agreement, guaranteed by Grigorios Siokas, with Synthesis Peer-To Peer-Income Fund (the “Loan Facility” the “Lender”). The Loan Facility initially provided SkyPharm with a credit facility of up to $1,292,769 (€1,225,141). Any advance under the Loan Facility accrues interest at a rate of 10% per annum and requires quarterly interest payments commencing on September 30, 2016. The amounts owed under the Loan Facility shall be repayable upon the earlier of (i) three months following the demand of the Lender; or (ii) August 31, 2018. No prepayment is permitted pursuant to the terms of the Loan Facility. The Synthesis Facility Agreement as amended is secured by a personal guaranty of Grigorios Siokas, which is secured by a pledge of 1,000,000 shares of common stock of the Company owned by Mr. Siokas. On September 13, 2016, SkyPharm entered into a First Deed of Amendment with the Loan Facility increasing the maximum loan amount to $1,533,020 as a result of the Lender having advanced $240,251 (€227,629) to SkyPharm. On March 23, 2017, SkyPharm entered into an Amended and Restated Loan Facility Agreement (the “A&R Loan Facility”), with the Loan Facility which increased the loan amount to an aggregate total of $2,664,960 (€2,216,736) as a result of the lender having advanced $174,000 (€164,898) in September 2016, $100,000 (€94,769) in October 2016, $250,000 (€236,922) in November 2016, $452,471 (€428,800) in December 2016, $155,516 (€129,360) in January 2017, $382,327 (€318,023) in July 2017 and $70,000 (€58,227) in December 2017. The A&R Loan Facility amends and restates certain provisions of the Loan Facility Agreement, dated as of August 4, 2016, by and among the same parties. Advances under the A&R Loan Facility continue to accrue interest at a rate of 10% per annum from the applicable date of each drawdown and require quarterly interest payments. The A&R Facility now permits prepayments at any time. The amounts owed under the A&R Loan Facility were repayable upon the earlier of (i) seventy-five days following the demand of the Lender; or (ii) August 31, 2018. The A&R Loan Facility is secured by a personal guaranty of Grigorios Siokas, which is secured by a pledge of 1,000,000 shares of common stock of the Company owned by Mr. Siokas (the “Pledged Shares”). The A&R Loan Facility was also amended to provide additional affirmative and negative covenants of Sky Pharm and the Guarantor during the term of loans remain outstanding, including, but not limited to, the consent of the Lender in connection with (i) the Company or any of its subsidiaries incurring any additional indebtedness; or (ii) in the event of any increase in the Company’s issued and outstanding shares of Common Stock, the Pledged Shares shall be increased to an amount equal to a minimum of ten percent (10%) of the issued and outstanding shares of the Company. As of December 31, 2019, the outstanding balance under the A&R Loan Facility was $3,078,442 (€2,741,999) and accrued interest expense of $609,607 (€542,983) had been recorded. On April 18, 2018, the Company entered into an amendment with the Lender that was effective as of January 1, 2018, pursuant to which the maturity dates for all advances was extended to December 31, 2021. Additionally, the interest rate was amended such that the interest rate for all advances is 4% plus the 3-Month Libor rate. The Loan Facility also forgave €35,060 ($40,000) in fees related to the July 6, 2017 advance. As a result, the Company reduced the unamortized portion of debt discount that related to those fees and recorded a gain on debt settlement of €19,763 ($23,354). Bridge Loans In 2017, the Company entered into loan agreements with Synthesis Peer-To-Peer Income Fund (the “Bridge Loans”) in the amounts of €41,590 ($50,000), €100,000 ($120,220) and €31,388 ($34,745). The Company had accrued interest expense of an aggregate total of €24,608 ($27,627) for both loans and the outstanding balances of these loans was €45,809 ($50,000), €83,333 ($106,542), €31,388 ($34,745), respectively, as of December 31, 2019. On June 30, 2020, the Company entered into a settlement agreement whereby the Company agreed to make certain payments to the creditor and the creditor will accept such payments as full discharge of the outstanding debt of the Loan Facility and Bridge Loans. In accordance with the settlement agreement, interest will accrue from June 30, 2020 until repayment in full at a rate of 6% per annum for the first year and 5.25% per annum for the second year calculated on the balance outstanding from day to day during such period. Interest is due on the 10 th The debt is subject to acceleration in an Event of Default (as defined in the Notes). This agreement is secured by a personal guaranty of Grigorios Siokas, which is secured by a pledge of 1,000,000 shares of common stock of the Company owned by Mr. Siokas, as described above under A&R Loan Facility. Trade Facility Agreements On April 10, 2017, Decahedron entered into a Trade Finance Facility Agreement (the “Decahedron Facility”) with Synthesis Structured Commodity Trade Finance Limited (the “Lender”). The Decahedron Facility provides the following material terms: · The Lender will provide Decahedron a facility of up to €2,750,000 ($3,363,250) secured against Decahedron’s receivables from the sale of branded and generic pharmaceutical sales. · The total facility will be calculated as 95% of the agreed upon value of Decahedron’s receivables. · The term of the Decahedron Facility will be for 12 months. · The obligations of Decahedron are guaranteed by the Company pursuant to a Cross Guarantee and Indemnity Agreement. · The Lender has the right to make payments directly to Decahedron’s suppliers. · The following fees should be paid in connection with the Decahedron Facility: o 2% of the maximum principal amount as an origination fee. o A one percent (1%) monthly fee. The current draw on the Decahedron Facility is $0. On May 12, 2017, SkyPharm entered into a Trade Finance Facility Agreement (the “SkyPharm Facility”) with Synthesis Structured Commodity Trade Finance Limited (the “Lender”). The SkyPharm Facility provides the following material terms: · The Lender will provide SkyPharm a facility of up to €2,000,000 ($2,446,400) secured against SkyPharm’s receivables from the sale of branded and generic pharmaceutical sales. In the event that accounts receivable becomes uncollectible, the Company will be obligated to pay back the notes in full. · The total facility will be calculated as 95% of the agreed upon value of Decahedron’s receivables. · The initial term of the SkyPharm Facility was for 12 months. · The obligations of SkyPharm are guaranteed by the Company pursuant to a Cross Guarantee and Indemnity Agreement. · The Lender has the right to make payments directly to SkyPharm’s suppliers. · The following fees should be paid in connection with the SkyPharm Facility: o 2% of the maximum principal amount as an origination fee. o A one percent (1%) monthly fee. The Company obtained consents from Synthesis Peer-to-Peer Income Fund in connection with obtaining the Lender. On November 16, 2017, SkyPharm signed an amended agreement with Synthesis Structured Commodity Trade Finance Limited that increased the maximum aggregate facility limit from €2,000,000 ($2,291,200) to €6,000,000 ($6,736,200). All other terms of the original agreement remain the same. The Company also obtained consents from Synthesis Peer-to-Peer Income Fund in connection with obtaining the November 2017 convertible debt financing. On May 12, 2018, the Company borrowed an additional €270,000 ($247,117) in funds. On May 16, 2018, SkyPharm S.A., as Commodity Buyer, entered into a Supplemental Deed of Amendment (the “Deed”) relating to a Trade Finance Facility dated May 12, 2017, as amended, with Synthesis Structured Commodity Trade Finance Limited (“Synthesis”), as Loan Receivables Originator. Under the Trade Finance Facility (the “TFF”) first entered into on May 12, 2017, as amended, there was a principal balance of €5,866,910 ($5,369,678) outstanding as of March 31, 2018. SkyPharm made a payment of €1,000,000 ($1,123,600) of interest and principal on May 31, 2018 under the terms and conditions of the Deed. Additionally, the maturity date for the facility has been amended such that, the full principal amount is to be repaid no later than May 31, 2021, subject to a repayment schedule to be agreed upon by SkyPharm and Synthesis Structure Commodity Trade Finance Limited. Synthesis Structure Commodity Trade Finance Limited may extend this final repayment date at its sole discretion. The TFF was amended to provide, among other things: · A listing of approved purchasers; · To permit SkyPharm to request Synthesis to make payments under the TFF directly to SkyPharm so that SkyPharm can discharge its obligations to a commodity seller directly; · To prohibit SkyPharm from entering into a commodity contract which grants more than seventy-five (75) days delay between the payment for products and receipt of the purchase price and placed other limitations on terms of commodity contracts; · If Grigorios Siokas, CEO of Cosmos Holdings Inc. (“Cosmos”), ceases to own or control at least fifty-one (51%) percent of the shares of Cosmos, or SkyPharm ceases to be a wholly-owned subsidiary of Cosmos, either event shall constitute an Event of Default (as defined); · The maximum aggregate amount of the TFF is €15,000,000, although there is no commitment for any future loans under the TFF; · The interest rate on the TFF for: (i) all lending in U.S. dollars is the one-month LIBOR plus six (6%) percent margin; and (ii) for all lending in Euro, the one-month Euribor Rate plus six (6%) percent per annum, commencing June 1, 2018. · Synthesis is permitted to terminate the TFF at any time and demand repayment of all outstanding principal and interest in full within six (6) months from the date of notification. The Deed is conditioned upon, among other things, execution and perfection of a Bulgarian Amended Pledge (“BAP”) having priority over the Bulgarian Pledge Accounts with Unicredit Bulbank AD; and the Approved Purchasers are to make all payments to SkyPharm directly to the BAP. On May 16, 2018, SkyPharm and Synthesis also entered into an Account Merge Agreement (the “Pledge”) as a requirement under the above-described Deed. Under the Pledge, Synthesis is to receive a first ranking securities interest in SkyPharm’s outstanding receivables under the Bulgarian bank account. On October 17, 2018, the Company entered into a further amended agreement with Synthesis whereby the current balance on the TFF as of October 1, 2018, which was €4,866,910 ($5,629,555) and related accrued interest of €453,094 ($524,094) would be split into two principal balances of Euro €2,000,000 and USD $4,000,000. Interest on the new balances commenced on October 1, 2018 at 6% per annum plus one-month Euribor, when it is positive, on the Euro balance and 6% per annum plus one-month Libor on the USD balance. The Company will repay the principal amounts of each balance beginning no later than August 31, 2018 in quarterly installments of €125,000 and US $150,000. The loan matures on August 31, 2021. The Company evaluated the amended agreement under ASC 470-50 and concluded that it did not meet the 10% cash flow test and recorded debt modification expense of $138,110. On December 30, 2020, the Company transferred the Euro €2,000,000 loan to a new third-party lender. The terms remained the same except interest will now accrue at 5.5% per annum plus Euribor. The principal is to be repaid in a total of five quarterly installments beginning October 31, 2021 of 50,000 Euro each with a final repayment of 1,800,000 Euro payable on the earlier of 24 months after December 30, 2020 or October 31, 2022. As of December 31, 2019, the Company had a principal balance of €2,000,000 ($2,245,400) and $4,000,000 under the TFF and the Company had accrued $10,000 and $12,661, respectively in interest expense related to this agreement. As of December 31, 2020, the Company had principal balances of €2,000,000 ($2,446,000), of which $2,384,850 is classified as Notes payable – long term portion on the consolidated balance sheet, and $4,000,000 under the agreements and the Company had accrued $402 and $16,185 respectively, in interest expense related to these agreements. Distribution and Equity Agreement As discussed in Note 2 above, the Company entered into a Distribution and Equity Acquisition Agreement with Marathon. The Company was appointed the exclusive distributor of the Products (as defined) initially throughout Europe and on a non-exclusive basis wherever else lawfully permitted. As consideration for its services, Company received: (a) a 33 1/3% equity interest or 5 million shares in Marathon as partial consideration for the Company’s distribution services; and (b) received cash of CAD $2,000,000, subject to repayment in Common Shares of the Company if it fails to meet certain performance milestones. The Company is entitled to receive an additional CAD $2,750,000 upon the Company’s receipt of gross sales of CAD $6,500,000 and an additional CAD $2,750,000 upon receipt of gross sales of CAD $13,000,000. As discussed in Note 2, the Company attributed no value to the shares received in Marathon pursuant to (a) above. In relation to the CAD $2 million cash received noted in (b) above, the Company accounted for its obligation to issue a variable number of the Company’s Common Shares as Share-settled debt obligation in accordance with ASC 480 measured at fair value or the settlement amount of $1,554,590 (CAD $2 million). If settlement were to occur on December 31, 2020, the Company would be required to issue 298,875 common shares to settle its debt obligation. The Company could be obligated to potentially issue an unlimited number of common shares to settle its Share-settled debt obligation. If such events were to occur, the Company would be required to increase its authorized share capital and since increasing the authorized share capital is within the control of the Company, as our CEO controls greater than 50% of the outstanding common stock of the Company, the original classification of equity-classified financial instruments issued by the Company were not affected. Senior Promissory Notes executed on April 1 and 3, 2019 On April 1 and 3, 2019, the Company executed Senior Promissory Notes (the “Notes”) each in the principal amount of $250,000 payable to an unaffiliated third-party lender. The Notes bear interest at the rate of fifteen (15%) percent per annum, paid quarterly in arrears. The Notes originally matured on April 1 and 3, 2020 unless prepaid or in default. On April 1, 2020, the Company entered into an amendment with the lender pursuant to which the new maturity date for both notes is April 1, 2021. Additionally, pursuant to the amendment, the Company may now prepay the Notes at any time without penalty. The Notes are subject to acceleration in an Event of Default (as defined in the Notes). Grigorios Siokas, the Company’s CEO, personally guaranteed repayment of the Notes. The guaranty is unconditional and irrevocable and constitutes a guaranty of performance and of payment when due, and not just of collection. As of December 31, 2019, the Company had a principal balance $250,000 and $250,000 on these notes and the Company had accrued $9,452 and $28,098, respectively, in interest expense. As of December 31, 2020, the Company had a principal balance $250,000 and $250,000 on these notes and the Company had accrued $46,026 and $64,364 respectively, in interest expense. On February 5, 2021, pursuant to an exchange agreement, the Company converted the principal balance of the note into shares of the Company’s common stock (See Note 16). Senior Promissory Note executed on April 9,2019 On April 9, 2019, the Company executed a Senior Promissory Note (the “Note”) in the principal amount of $250,000 payable to an unaffiliated third-party lender who had previously loaned the Company $500,000. The Note bears interest at the rate of fifteen (15%) percent per annum, paid quarterly in arrears. The Note originally matured on April 9, 2020, unless prepaid or in default. As of April 9, 2020, the Company entered into an amendment with the lender pursuant to which the new maturity date for the note is now April 9, 2021 and the Company may now prepay the loan without penalty at any time. The Note is subject to acceleration in an Event of Default (as defined in the Note). Grigorios Siokas, the Company’s CEO, personally guaranteed repayment of the Note. The guaranty is unconditional and irrevocable and constitutes a guaranty of performance and of payment when due, and not just of collection. As of December 31, 2019, the Company had a principal balance $250,000 on this Note and the Company had accrued $27,431 in interest expense. As of December 31, 2020, the Company had a principal balance $250,000 on this Note and the Company had accrued $63,697 in interest expense. On February 5, 2021, pursuant to an exchange agreement, the Company converted the principal balance of the note into shares of the Company’s common stock (See Note 16). July 24, 2019 Senior Promissory Note On July 24, 2019, the Company executed a Senior Promissory Note (the “July Note”) in the principal amount of $750,000 payable to an unaffiliated third-party lender who had previously loaned the Company $750,000. The funds represented by the July Note were advanced between July 19 and 24, 2019. The July Note bears interest at the rate of fifteen (15%) percent per annum, paid quarterly in arrears. The July Note originally matured on July 24, 2020. On July 24, 2020, the Company entered into an amendment with the lender pursuant to which the new maturity date for the note is now July 24, 2021 and the Company may now prepay the loan without penalty at any time. The July Note is subject to acceleration in an Event of Default. Grigorios Siokas, the Company’s CEO, personally guaranteed repayment of the July Note. The guaranty is unconditional and irrevocable and constitutes a guaranty of performance and of payment when due, and not just of collection. As of December 31, 2019, the Company had a principal balance $750,000 on this note and the Company had accrued $49,625 in interest expense. As of December 31, 2020, the Company had a principal balance $750,000 on this note and the Company had accrued $158,429 in interest expense. On February 5, 2021, pursuant to an exchange agreement, the Company converted the principal balance of the note into shares of the Company’s common stock (See Note 16). August 1, 2019 Senior Promissory Note On August 1, 2019, the Company executed a Senior Promissory Note (the “August Note”) in the principal amount of $500,000 payable to an unaffiliated third-party lender who had previously loaned the Company $1,500,000. The August Note bears interest at the rate of fifteen (15%) percent per annum, paid quarterly in arrears. The August Note originally matured on August 1, 2020. On August 1, 2020, the Company entered into an amendment with the lender pursuant to which the new maturity date for the note is now August 1, 2021 and the Company may now prepay the loan without penalty at any time. The August Note is subject to acceleration in an Event of Default. Grigorios Siokas, the Company’s CEO, personally guaranteed repayment of the August Note. The guaranty is unconditional and irrevocable and constitutes a guaranty of performance and of payment when due, and not just of collection. As of December 31, 2019, the Company had a principal balance $500,000 on this note and the Company had accrued $31,438 in interest expense. As of December 31, 2020, the Company had a principal balance $500,000 on this note and the Company had accrued $103,972 in interest expense. On February 5, 2021, pursuant to an exchange agreement, the Company converted the principal balance of the note into shares of the Company’s common stock (See Note 16). October 23, 2019 Senior Promissory Note On October 23, 2019, the Company executed a Senior Promissory Note (the “October Note”) in the principal amount of $250,000 payable to an unaffiliated third-party lender who had previously loaned the Company $2,000,000. The October Note bears interest at the rate of fifteen (15%) percent per annum, paid quarterly in arrears. The October Note originally matured on October 23, 2020, unless prepaid or in default. As of October 23, 2020, the Company entered into an amendment with the lender pursuant to which the new maturity date for the note is now October 23, 2021 and the Company may prepay the October Note at any time without penalty The October Note is subject to acceleration in an Event of Default. Grigorios Siokas, the Company’s CEO, personally guaranteed repayment of the October Note. The guaranty is unconditional and irrevocable and constitutes a guaranty of performance and of payment when due, and not just of collection. As of December 31, 2019, the Company had a principal balance $250,000 on this note and the Company had accrued $7,705 in interest expense. As of December 31, 2020, the Company had a principal balance $250,000 on this note and the Company had accrued $43,971 in interest expense. On February 5, 2021, pursuant to an exchange agreement, the Company converted the principal balance of the note into shares of the Company’s common stock (See Note 16). December 6, 2019 Senior Promissory Note On December 6, 2019, the Company executed a Senior Promissory Note (the “December Note”) in the principal amount of $250,000 payable to an unaffiliated third-party lender who had previously loaned the Company $2,250,000. The December Note originally bore interest at the rate of fifteen (15%) percent per annum, paid quarterly in arrears. The Note originally matured on March 31, 2020, unless prepaid or in default. As of March 31, 2020, the Company entered into an amendment with the lender pursuant to which the new maturity date for the note is now December 31, 2020. The note is not in default and on February 5, 2021 the Company converted the entire outstanding principal balance into shares of the Company’s common stock (See Note 16). Additionally, the interest rate changed to 10% per annum from March 31, 2020 through maturity and the Company may now prepay the December Note at any time without penalty. The December Note is subject to acceleration in an Event of Default. Grigorios Siokas, the Company’s CEO, personally guaranteed repayment of the December Note. The guaranty is unconditional and irrevocable and constitutes a guaranty of performance and of payment when due, and not just of collection. As of December 31, 2019, the Company had a principal balance $250,000 on this note and the Company had accrued $890 in interest expense. As of December 31, 2020, the Company had a principal balance $250,000 on this note and the Company had accrued $21,952 in interest expense. On February 5, 2021, pursuant to an exchange agreement, the Company converted the principal balance of the note into shares of the Company’s common stock (See Note 16). January 27, 2020 Senior Promissory Note On January 27, 2020, the Company executed a Senior Promissory Note (the “January Note”) in the principal amount of $250,000 payable to an unaffiliated third-party lender who had previously loaned the Company $2,500,000. The January Note bore interest at the rate of five (5%) percent per annum, paid quarterly in arrears. The January Note originally matured on May 15, 2020 unless in default. On May 15, 2020, the Company entered into an amendment with the lender pursuant to which the new maturity date for the note is now December 31, 2020. Additionally, the interest rate was changed to 10% per annum and the Company may now prepay the January Note at any time without penalty. The January Note is subject to acceleration in an Event of Default. Grigorios Siokas, the Company’s CEO, personally guaranteed repayment of the January Note. The guaranty is unconditional and irrevocable and constitutes a guaranty of performance and of payment when due, and not just of collection. As of December 31, 2020, the Company had a principal balance of $250,000 on this note and the Company had accrued $18,458 in interest expense. February 25, 2020 Senior Promissory Note On February 25, 2020, the Company executed a Senior Promissory Note (the “February Note”) in the principal amount of $1,000,000 payable to an unaffiliated third-party lender. The February Note bears interest at the rate of eighteen (18%) percent per annum, paid quarterly in arrears. The February Note matured on April 30, 2020. The February Note is subject to acceleration in an Event of Default. Grigorios Siokas, the Company’s CEO, personally guaranteed repayment of the February Note. The guaranty is unconditional and irrevocable and constitutes a guaranty of performance and of payment when due, and not just of collection. In July 2020, the Company used a portion of the proceeds from the July 3, 2020 senior promissory note to repay the principal of the February Note. The Company was not in default at that time. The Company also repaid all accrued interest related to the February Note. February and March 2020 Notes On February 27, 2020 and March 23,2020, the Company executed two Senior Promissory Notes (the “Quarter-1 Notes”) in the principal amounts of $25,000 and $35,000, respectively, payable to an unaffiliated third-party lender. The Quarter-1 Notes originally bore interest at the rate of five (5%) percent per annum, paid quarterly in arrear and mature on December 31, 2020 unless in default. On June 1, 2020 the Company entered into an amendment pursuant to which the interest rate was changed to 10% per annum and the Company may now prepay the Quarter-1 Notes at any time without penalty. The Quarter-1 Notes are subject to acceleration in an Event of Default (as defined). Grigorios Siokas, the Company’s CEO, personally guaranteed repayment of the Quarter-1 Notes. The guaranty is unconditional and irrevocable and constitutes a guaranty of performance and of payment when due, and not just of collection. As of December 31, 2020, the Company had a principal balance of $25,000 and $35,000, respectively, on these notes and the Company had accrued an aggregate of $3,963 in interest expense. On February 5, 2021, pursuant to an exchange agreement, the Company converted the principal balance of the note into shares of the Company’s common stock (See Note 16). April 23, 2020 Senior Promissory Note On April 23, 2020, the Company executed a Senior Promissory Note (the “April Note”) in the principal amount of $200,000 payable to an unaffiliated third-party lender who had previously loaned the Company $2,750,000. The April Note bears interest at the rate of five (5%) percent per annum through May 31, 2020 and then shall change to 1% per annum effective June 1, 2020 paid quarterly in arrears. The April Note matures on December 31, 2020 unless in default. The Company may prepay the April Note within the first six (6) months by payment of unpaid interest for the first six (6) months and, after six (6) months, with a two (2%) percent ($4,000) premium. The April Note is subject to acceleration in an Event of Default. Grigorios Siokas, the Company’s CEO, personally guaranteed repayment of the April Note. The guaranty is unconditional and irrevocable and constitutes a guaranty of performance and of payment when due, and not just of collection. As of December 31, 2020, the Company had a principal balance of $200,000 on this note and the Company had accrued $2,772 in interest expense. On February 5, 2021, pursuant to an exchange agreement, the Company converted the principal balance of the note into shares of the Company’s common stock (See Note 16). May 5, 2020 Senior Promissory Note On May 5, 2020, the Company executed a Senior Promissory Note (the “May 5 Note”) in the principal amount of $2,000,000 payable to an unaffiliated third-party lender who had previously loaned the Company $1,000,000. The May 5 Note bears interest at the rate of eighteen (18%) percent per annum, paid quarterly in arrears. The May 5 Note matured on December 31, 2020. The May 5 Note is subject to acceleration in an Event of Default. Grigorios Siokas, the Company’s CEO, personally guaranteed repayment of the May 5 Note. The guaranty is unconditional and irrevocable and constitutes a guaranty of performance and of payment when due, and not just of collection. In July 2020, the Company used a portion of the proceeds from the July 3, 2020 senior promissory note to repay the principal of the May 5 Note. The Company also repaid the accrued interest related to this note. May 8, 2020 Senior Promissory Note On May 8, 2020, the Company executed a Senior Promissory Note (the “May 8 Note”) in the principal amount of $2,000,000 payable to an unaffiliated third-party lender who had previously loaned the Company $3,000,000. The May 8 Note bears interest at the rate of eighteen (18%) percent per annum, paid quarterly in arrears. The May 8 Note matured on June 8, 2020. The May 8 Note is subject to acceleration in an Event of Default (as defined). Grigorios Siokas, the Company’s CEO, personally guaranteed repayment of the May 8 Note. The guaranty is unconditional and irrevocable and constitutes a guaranty of performance and of payment when due, and not just of collection. In July 2020, the Company used a portion of the proceeds from the July 3, 2020 senior promissory note to repay the principal of the May 8 Note. The Company also repaid the accrued interest related to this note. May 18, 2020 and July 3, 2020 Senior Promissory Notes May 18, 2020 Senior Promissory Note On May 18, 2020, the Company executed a Senior Promissory Note (the “May 18 Note”) in the principal amount of $2,000,000 payable to an unaffiliated third-party lender. The May 18 Note bears interest at the rate of eighteen (18%) percent per annum, paid quarterly in arrears. The May 18 Note matured on December 31, 2020. The note is not in default and the Company is currently in negotiations with the lender to extend the maturity date. The May 18 Note is subject to acceleration in an Event of Default. Grigorios Siokas, the Company’s CEO, personally guaranteed repayment of the May 18 Note. The guaranty is unconditional and irrevocable and constitutes a guaranty of |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2020 | |
LEASES | |
NOTE 11 - LEASES | The Company has various lease agreements with terms up to 10 years, comprising leases of office space. Some leases include options to purchase, terminate or extend for one or more years. These options are included in the lease term when it is reasonably certain that the option will be exercised. The assets and liabilities from operating and finance leases are recognized at the commencement date based on the present value of remaining lease payments over the lease term using the Company’s secured incremental borrowing rates or implicit rates, when readily determinable. Short-term leases, which have an initial term of 12 months or less, are not recorded on the balance sheet. The Company’s operating leases do not provide an implicit rate that can readily be determined. Therefore, we use a discount rate based on our incremental borrowing rate, which is determined using the interest rate of our long-term debt as of January 1, 2019. The Company’s weighted-average remaining lease term relating to its operating leases is 7.3 years, with a weighted-average discount rate of 6.74%. The Company incurred lease expense for its operating leases of $188,400 and $223,927 which was included in “General and administrative expenses,” for the year ended December 31, 2020 and 2019, respectively. The following table presents information about the amount, timing and uncertainty of cash flows arising from the Company’s operating leases as of December 31, 2020. Maturity of Lease Liability 2021 $ 248,288 2022 218,083 2023 192,583 2024 58,704 Thereafter 220,107 Total undiscounted operating lease payments $ 937,765 Less: Imputed interest (147,023 ) Present value of operating lease liabilities $ 790,742 The Company’s weighted-average remaining lease term relating to its finance leases is 5.11 years, with a weighted-average discount rate of 6.74%. The following table presents information about the amount, timing and uncertainty of cash flows arising from the Company’s finance leases as of December 31, 2020: Maturity of Lease Liability 2021 $ 105,620 2022 76,252 2023 65,939 2024 49,688 2025 16,430 Thereafter - Total undiscounted finance lease payments $ 313,929 Less: Imputed interest (35,831 ) Present value of finance lease liabilities $ 278,098 The Company had financing cash flows used in finances leases of $85,804 and 74,476 for the years ended December 31, 2020 and 2019, respectively. The Company incurred interest expense on its finance leases of $13,759 and $10,927 which was included in “Interest expense,” for the years ended December 31, 2020 and 2019, respectively. The Company incurred amortization expense on its finance leases of $123,533 and $160,542 which was included in “Depreciation and amortization expense,” for the years ended December 31, 2020 and 2019, respectively. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2020 | |
COMMITMENTS AND CONTINGENCIES | |
NOTE 12 - COMMITMENTS AND CONTINGENCIES | Legal Matters From time to time, the Company may be involved in litigation relating to claims arising out of the Company’s operations in the normal course of business. As of December 31, 2020 and 2019, there were no pending or threatened lawsuits that could reasonably be expected to have a material effect on the results of the Company’s operations. Placement Agreement On August 8, 2017, the Company entered into an agreement with a third-party placement agent (the “Agent”) who served serve as the Company’s exclusive placement agent or sole book running manager with respect to any offerings of equity or equity-linked securities as well as any debt offering with the two organizations named in the agreement (the “Offering”) for a period of 120 days. In the event that an Offering is agreed upon by the Agent and the Company, the Company shall provide payment as follows: (1) a cash commission of 6% of the total gross proceeds for two named investors (2) a cash commission of 4% of total gross proceeds from five named investors and (3) excluding the five named investors in “(2)” a cash commission equal to 8% of the total gross proceeds from the Offering and the issuance to the Agent or its designees of warrants covering 8% of the shares of common stock issued or issuable by the Company in the Offering. Additionally, the Agent will receive a cash fee of 8% payable within 5 business days, but only in the event of, the receipt by the Company of any cash proceeds from the exercise of any warrants with an expiration equal to or less than 24 months sold in the Offering. In connection with the Company’s November 16, 2017 Note offering, the Agent received a cash commission of $240,000, equal to eight (8%) percent of the total gross proceeds of the offering and the issuance of five-year warrants to purchase eight (8%) percent of the shares of common stock issued or issuable in the offering (excluding shares of common stock issuable upon exercise of any warrants issued to investors, or 53,600 shares); however, will receive eight (8%) percent of any cash proceeds received from the exercise of any warrants sold in the offering with an expiration equal to or less than twenty-four (24) months. The warrants are exercisable six (6) months after the date of issuance, or as of May 16, 2018. In connection with the Company’s September 4, 2018 Note offering, the Agent received a cash commission for this transaction of $140,000, equal to seven (7%) percent of the total gross proceeds of the offering and the issuance of five-year warrants to purchase seven (7%) percent of the shares of common stock issued or issuable in this offering (excluding shares of common stock issuable upon exercise of any warrants issued to investors, or 26,056 shares); however, will receive seven (7%) percent of any cash proceeds received from the exercise of any warrants sold in the offering with an expiration equal to or less than twenty-four (24) months. The warrants are exercisable six (6) months after the date of issuance, or March 4, 2019. Advisory Agreement On April 18, 2018, SkyPharm S.A. entered into a ten-year Advisory Agreement with Synthesis Management Limited (the “Advisor”). The Advisor was retained to assist SkyPharm to secure corporate finance capital. The Advisor shall be paid €104,000 per year during the ten-year term. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Dec. 31, 2020 | |
EARNINGS PER SHARE | |
NOTE 13 - EARNINGS PER SHARE | Basic net income (loss) per share is computed by dividing net income (loss) attributable to the Company, decreased with respect to net income or increased with respect to net loss by dividends declared on preferred stock by using the weighted-average number of common shares outstanding. The dilutive effect of incremental common shares potentially issuable under outstanding options, warrants and restricted shares is included in diluted earnings per share in 2020 and 2019 utilizing the treasury stock method. The computations of basic and diluted per share data were as follows: 2020 2019 Numerator for Basic and Diluted Earnings Per Share: Net income (loss) $ 820,786 $ (3,298,965 ) Denominator for Basic Earnings Per Share: Weighted Average Shares 13,270,097 13,273,596 Potentially Dilutive Common Shares 37,698 - Adjusted Weighted Average Shares 13,307,795 13,273,596 Basic and Diluted Net Income (Loss) per Share 0.06 (0.25 ) The following table summarized the potential shares of common stock that were excluded from the computation of diluted net loss per share for the years ended December 31, 2020 and 2019 as such shares would have had an anti-dilutive effect: 2020 2019 Common stock warrants - - Common Stock Options - 42,808 Convertible Debt - - Total - 42,808 |
STOCK OPTIONS AND WARRANTS
STOCK OPTIONS AND WARRANTS | 12 Months Ended |
Dec. 31, 2020 | |
STOCK OPTIONS AND WARRANTS | |
NOTE 14 - STOCK OPTIONS AND WARRANTS | As of December 31, 2020, there were 62,000 options outstanding and 62,000 options exercisable with expiration dates commencing January 2021 and continuing through January 2022. A summary of the Company’s option activity during the years ended December 31, 2020 and 2019 is presented below: Weighted Weighted Average Average Remaining Aggregate Number of Exercise Contractual Intrinsic Options Shares Price Term Value Balance Outstanding, December 31, 2018 74,000 $ 1.32 2.47 $ 198,000 Granted - - - - Forfeited - - - - Exercised - - - - Expired - - - - Balance Outstanding, December 31, 2019 74,000 $ 1.32 1.47 $ 64,800 Granted - - - - Forfeited (12,000 ) - - - Exercised - - - - Expired - - - - Balance Outstanding, December 31, 2020 62,000 $ 1.19 0.60 $ 242,200 Exercisable, December 31, 2020 62,000 $ 1.19 0.60 $ 242,200 A summary of the Company’s warrant activity for the years ending December 31, 2020 and 2019 is as follows: Weighted Weighted Average Average Remaining Aggregate Number of Exercise Contractual Intrinsic Warrants Shares Price Term Value Balance Outstanding, December 31, 2018 1,164,673 $ 6.41 5.01 $ - Granted - - - - Forfeited - - - - Exercised - - - - Expired - - - - Balance Outstanding, December 31, 2019 1,164,673 $ 6.41 4.01 $ - Granted - - - - Forfeited - - - - Exercised - - - - Expired - - - - Balance Outstanding, December 31, 2020 1,164,673 $ 6.41 3.01 $ 5,360 Exercisable, December 31, 2020 1,164,673 $ 6.41 3.01 $ 5,360 |
DISAGGREGATION OF REVENUE
DISAGGREGATION OF REVENUE | 12 Months Ended |
Dec. 31, 2020 | |
DISAGGREGATION OF REVENUE | |
NOTE 15 - DISAGGREGATION OF REVENUE | ASC 606-10-50-5 requires that entities disclose disaggregated revenue information in categories (such as type of good or service, geography, market, type of contract, etc). ASC 606-10-55-89 explains that the extent to which an entity’s revenue is disaggregated depends on the facts and circumstances that pertain to the entity’s contracts with customers and that some entities may need to use more than one type of category to meet the objective for disaggregating revenue. The Company disaggregates revenue by country to depict the nature and economic characteristics affecting revenue. The following table presents our revenue disaggregated by country for the years ended: Country 2020 2019 Croatia $ 24,840 $ 22,497 Cyprus 36,987 - Denmark 537,098 97,905 France 18,988 153,422 Georgia - 5,301 Germany 1,314,381 6,672,511 Greece 51,259,784 26,101,316 Hungary - 1,094,446 Indonesia - 7,172 Ireland 36,349 467,965 Italy 75,183 196,044 Jordan 29,635 20,144 Libya 1,028 396,333 Netherlands 188,890 846,479 Poland 29,358 307,624 Spain - - Turkey - 24,347 UK 1,853,816 3,262,880 Total $ 55,406,337 $ 39,676,385 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2020 | |
SUBSEQUENT EVENTS | |
NOTE 16 - SUBSEQUENT EVENTS | January 7, 2021 Subscription Agreement On January 7, 2021 (the “Issue Date”), the Company entered into a subscription agreement with an unaffiliated third party, whereby the Company issued for a purchase price of $100,000 in principal amount a convertible promissory note. The note bears an interest rate of 8% per annum and matures on the earlier of (i) consummation of the Company listing its common shares on the NEO Stock Exchange or October 31, 2021. Upon the consummation of a NEO listing, the total principal and accrued interest outstanding on the note will convert into shares of the Company’s common stock at a 25% discount to the prices of the common shares sold in the financing to be conducted in conjunction with the NEO listing. In the event that a NEO listing is not consummated on or before October 31, 2021, the note holder will have the option, in part or in full, to have the note repaid with interest, or convert the note into Company common stock at a 25% discount to the 30-day volume-weighted average price of the Common Shares on the most senior stock exchange in North American on which the common shares are trading prior to conversion. Exchange Agreement The Company entered into an Amended and Restated Debt Exchange Agreement (the “Agreement”) dated as of February 5, 2021, with an unaffiliated third-party lender (the “Lender”). This Agreement replaced in its entirety the Debt Exchange Agreement between the parties dated as of December 18, 2020, which was deemed to be null and void. The Agreement provides for the issuance by the Company of 781,819 shares of common stock (the “Exchange Shares”), at the rate of $3.85 per share, in exchange for an aggregate of $3,010,000 principal amount (the “Debt”) of existing loans made by the Lender to the Company. The market price at the time this Agreement was negotiated was $3.85 per share. Certain “make whole” provisions and the grant of warrants were eliminated. Interest was accrued through the date of the Agreement. Thereafter, all accrued and unpaid interest, as well as any unpaid fees, shall be paid in three (3) equal monthly installments following the closing of a planned Canadian public offering. Pursuant to this Agreement, Grigorios Siokas, the Company’s Chief Executive Officer and principal shareholder, will be released from all personal guarantees on the Debt. Stock Purchase Agreement On February 5, 2021, the Company entered into a Stock Purchase Agreement (the “February SPA”) with an unaffiliated third-party. The February SPA provides for the Company’s to sell 65,000 shares of the Company’s common stock held in treasury at $3.85 per share or a total of $250,000. February 5, 2021 Consulting Agreement The Company entered into a Consulting Agreement (the “Agreement”) effective as of February 5, 2021, with a non-affiliated consultant (the “Consultant”). The Company engaged the Consultant to perform consulting services relating to Company management, debt structure, business plans and business development in connection with any capitalization transactions involving the Company and any newly created or existing entities. The Agreement is for a term of nine (9) months with an initial term of ninety (90) days (the “Initial Term”). The Agreement is terminable by the Company for any reason upon written notice at any time after the Initial Term. The Company agreed to pay Consultant and its assignees an aggregate of 1,800,000 restricted shares of Common Stock at the rate of 200,000 shares per month, which shall be issued and fully paid for in consideration of the Consultant’s considerable expertise and experience and its commitment to work for the Company. However, in the event the Agreement is terminated for any reason after the Initial Term, the shares are subject to a claw back for any months remaining after the Termination Date. The Consultant retained 800,000 of the 1,800,000 shares and agreed with an assignee and the Company that 1,600,000 of the 1,800,000 shares shall be held in book entry for six (6) months from the date of this Agreement, subject to the above claw back. |
ORGANIZATION AND NATURE OF BU_2
ORGANIZATION AND NATURE OF BUSINESS (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
ORGANIZATION AND NATURE OF BUSINESS | |
Basis of Financial Statement Presentation | The accompanying consolidated financial statements have been prepared in accordance with principles generally accepted in the United States of America. |
Principles of Consolidation | Our consolidated accounts include our accounts and the accounts of our wholly-owned subsidiaries, SkyPharm S.A., Decahedron Ltd. and Cosmofarm Ltd. All significant intercompany balances and transactions have been eliminated. |
Use of Estimates | The preparation of the consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
The Effects of COVID-19 | Due to the COVID-19 pandemic, there has been uncertainty and disruption in the global economy and financial markets. The Company is not aware of any specific event or circumstance that would require an update to its estimates or judgments or a revision of the carrying value of its assets or liabilities as of April 15, 2021, the date of issuance of this Annual Report on Form 10-K. These estimates may change, as new events occur, and additional information is obtained. Actual results could differ materially from these estimates under different assumptions or conditions. |
Foreign Currency Translation and Other Comprehensive Income (Loss) | The functional currency of the Company’s subsidiaries is the Euro and British Pound. For financial reporting purposes, both the Euro (“EUR”) and British Pound (“GBP”) have been translated into United States dollars ($) and/or (USD) as the reporting currency. Assets and liabilities are translated at the exchange rate in effect at the balance sheet date. Revenues and expenses are translated at the average rate of exchange prevailing during the reporting period. Equity transactions are translated at each historical transaction date spot rate. Translation adjustments arising from the use of different exchange rates from period to period are included as a component of stockholders’ equity (deficit) as “Accumulated other comprehensive income (loss).” Gains and losses resulting from foreign currency transactions are included in the statements of operations and comprehensive loss as other comprehensive income (loss). There have been no significant fluctuations in the exchange rate for the conversion of EUR or GBP to USD after the balance sheet date. Other Comprehensive Income (Loss) for all periods presented includes only foreign currency translation gains (losses). Assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing at the consolidated balance sheet date with any transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency included in the consolidated results of operations as incurred. As of December 31, 2020 and 2019, the exchange rates used to translate amounts in Euros into USD and British Pounds into USD for the purposes of preparing the consolidated financial statements were as follows: December 31, 2020 December 31, 2019 Exchange rate on balance sheet dates EUR: USD exchange rate 1.2230 1.1227 GBP: USD exchange rate 1.3662 1.3185 Average exchange rate for the period EUR: USD exchange rate 1.1410 1.1194 GBP: USD exchange rate 1.2829 1.2767 |
Cash and Cash Equivalents | For purposes of the statement of cash flows, the Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. As of December 31, 2020 and December 31, 2019, there were no cash equivalents. The Company maintains bank accounts in the United States denominated in U.S. Dollars and in Greece and in Bulgaria all of which are denominated in Euros. Additionally, the Company maintains a bank account in the United Kingdom denominated in British Pounds. As of December 31, 2020, the amounts in these accounts were $448,659, $134,935 and $1,651. As of December 31, 2019, the amounts in these accounts were $14,451, $10,987 and $4,080. Additionally, as of December 31, 2020 and 2019, the Company had cash on hand in the amount of $31,604 and $52,489, respectively. |
Account receivable, net | Accounts receivable are stated at their net realizable value. The allowance for doubtful accounts against gross accounts receivable reflects the best estimate of probable losses inherent in the receivables portfolio determined on the basis of historical experience, specific allowances for known troubled accounts and other currently available information. At December 31, 2020 and 2019, the Company’s allowance for doubtful accounts was $715,845 and $529,252, respectively. |
Reclassifications to Prior Period Financial Statements and Adjustments | Certain reclassifications have been made in the Company’s financial statements of the prior period to conform to the current year presentation. $4,381 in other investments for the year ended December 31, 2019 was reclassified to other current assets. $800,164 in accounts payable and accrued expenses was reclassified to accrued interest. For the year ended December 31, 2019, $264 in interest expense – related parties was reclassified to interest expense. Additionally, for the year ended December 31, 2019, $234,037, respectively in sales and marketing expenses were reclassified from general and administrative expenses. These reclassifications have no impact on previously reported net loss. |
Tax Receivables | The Company pays Value Added Tax (“VAT”) or similar taxes (“input VAT”), income taxes, and other taxes within the normal course of its business in most of the countries in which it operates related to the procurement of merchandise and/or services it acquires and/or on sales and taxable income. The Company also collects VAT or similar taxes on behalf of the government (“output VAT”) for merchandise and/or services it sells. If the output VAT exceeds the input VAT, this creates a VAT payable to the government. If the input VAT exceeds the output VAT, this creates a VAT receivable from the government. The VAT tax return is filed on a monthly basis offsetting the payables against the receivables. In observance of EU regulations for intra-EU cross-border sales, our subsidiaries in Greece, SkyPharm and Cosmofarm, do not charge VAT for sales to wholesale drug distributors registered in other European Union member states. As of December 31, 2020 and 2019, the Company had a VAT net payable balance of $159,198 and $136,891 respectively, recorded in the consolidated balance sheet as prepaid expenses and other current assets. |
Inventory | Inventory is stated at net realizable value using the weighted average method. Inventory consists primarily of finished goods and packaging materials, i.e. packaged pharmaceutical products and the wrappers and containers they are sold in. A periodic inventory system is maintained by 100% count. Inventory is replaced periodically to maintain the optimum stock on hand available for immediate shipment. The Company writes-down inventories to net realizable value based on physical condition, expiration date, current market conditions, as well as forecasted demand. The Company’s inventories are not highly susceptible to obsolescence. Many of the Company’s inventory items are eligible for return to our suppliers when pre-agreed product requirements, including, but not limited to, physical condition and expiration date, are not met. |
Property and Equipment, net | Property and equipment are stated at cost, less accumulated depreciation. Depreciation is provided on a straight-line basis over the useful lives (except for leasehold improvements which are depreciated over the lesser of the lease term or the useful life) of the assets as follows: Estimated Useful Life Leasehold improvements and technical works Lesser of lease term or 40 years Vehicles 6 years Machinery 20 years Furniture, fixtures and equipment 5–10 years Computers and software 3-5 years Depreciation expense was $240,886 and $201,000 for the years ended December 31, 2020 and 2019, respectively. |
Impairment of Long-Lived Assets | In accordance with ASC 360-10, Long-lived Assets, which include property and equipment and intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of long-lived assets to be held and used is measured by a comparison of the carrying amount of an asset to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated undiscounted future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the assets. Fair value is generally determined using the asset’s expected future discounted cash flows or market value, if readily determinable. For the years ended December 31, 2020 and 2019, the Company had no impairment of long-lived assets. |
Goodwill and Intangibles, net | The Company periodically reviews the carrying value of intangible assets not subject to amortization, including goodwill, to determine whether impairment may exist. Goodwill and certain intangible assets are assessed annually, or when certain triggering events occur, for impairment using fair value measurement techniques. These events could include a significant change in the business climate, legal factors, a decline in operating performance, competition, sale or disposition of a significant portion of the business, or other factors. Specifically, goodwill impairment is determined using a two-step process. The first step of the goodwill impairment test is used to identify potential impairment by comparing the fair value of a reporting unit with its carrying amount, including goodwill. The Company uses level 3 inputs and a discounted cash flow methodology to estimate the fair value of a reporting unit. A discounted cash flow analysis requires one to make various judgmental assumptions including assumptions about future cash flows, growth rates, and discount rates. The assumptions about future cash flows and growth rates are based on the Company’s budget and long-term plans. Discount rate assumptions are based on an assessment of the risk inherent in the respective reporting units. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired and the second step of the impairment test is unnecessary. If the carrying amount of a reporting unit exceeds its fair value, the second step of the goodwill impairment test is performed to measure the amount of impairment loss, if any. The second step of the goodwill impairment test compares the implied fair value of the reporting unit’s goodwill with the carrying amount of that goodwill. If the carrying amount of the reporting unit’s goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess. The implied fair value of goodwill is determined in the same manner as the amount of goodwill recognized in a business combination. That is, the fair value of the reporting unit is allocated to all of the assets and liabilities of that unit (including any unrecognized intangible assets) as if the reporting unit had been acquired in a business combination and the fair value of the reporting unit was the purchase price paid to acquire the reporting unit. On December 19, 2018, as a result of the acquisition of Cosmo farm, the Company recorded $49,697 of goodwill. Intangible assets with definite useful lives are recorded on the basis of cost and are amortized on a straight-line basis over their estimated useful lives. The Company uses a useful life of 5 years for an import/export license. The Company evaluates the remaining useful life of intangible assets annually to determine whether events and circumstances warrant a revision to the remaining amortization period. If the estimate of the intangible asset’s remaining useful life is changed, the remaining carrying amount of the intangible asset will be amortized prospectively over that revised remaining useful life. As of December 31, 2020, no revision to the remaining amortization period of the intangible assets was made. Amortization expense was $33,176 and $33,086 for the years ended December 31, 2020 and 2019, respectively. |
Equity Method Investment | For those investments in common stock or in-substance common stock in which the Company has the ability to exercise significant influence over the operating and financial policies of the investee, the investment is accounted for under the equity method. The Company records its share in the earnings of the investee and is included in “Equity earnings of affiliate” in the consolidated statement of operations. The Company assesses its investment for other-than-temporary impairment when events or changes in circumstances indicate that the carrying amount of the investment might not be recoverable and recognizes an impairment loss to adjust the investment to its then current fair value. |
Investments in Equity Securities | Effective January 1, 2018, the Company adopted Accounting Standards Update (“ASU”) 2016-01, and accordingly, investments in equity securities are accounted for at fair value with changes in fair value recognized in net income. Equity securities are classified as short-term or long-term based on the nature of the securities and their availability to meet current operating requirements. Equity securities that are readily available for use in current operations are reported as a component of current assets in the accompanying consolidated balance sheets. Equity securities that are not considered available for use in current operations would be reported as a component of long-term assets in the accompanying consolidated balance sheets. For equity securities with no readily determinable fair value, the Company elects a measurement alternative to fair value. Under this alternative, the Company measures the investments at cost, less any impairment, and adjusted for changes resulting from observable price changes in transactions for identical or similar investments of the investee. The election to use the measurement alternative is made for each eligible investment. As of December 31, 2020, investments consisted of 3,000,000 shares, which traded at a closing price of $0 per share or a value of $0 of ICC International Cannabis Corp., 40,000 shares which traded at a closing price of $5.45 per share, or value of $218,183 of Diversa S.A. and 16,666 shares which traded at a closing price of $0.28 per share or value of $4,609 of National Bank of Greece. Additionally, the Company has $4,772 in equity securities of Pancreta bank, which are not publicly traded and recorded at cost. See Note 2, for additional investments in equity securities. |
Fair Value Measurement | The Company applies FASB ASC 820, Fair Value Measurements and Disclosures, (“ASC 820”), for assets and liabilities measured at fair value on a recurring basis. ASC 820 establishes a common definition for fair value to be applied to existing generally accepted accounting principles that require the use of fair value measurements establishes a framework for measuring fair value and expands disclosure about such fair value measurements. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Additionally, ASC 820 requires the use of valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized below: Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2: Inputs other than quoted prices that are observable, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. Level 3: Unobservable inputs in which little or no market data exists, therefore developed using estimates and assumptions developed by us, which reflect those that a market participant would use. The following table presents assets that are measured and recognized at fair value as of December 31, 2020 and 2019, on a recurring basis: December 31, 2020 Total Carrying Level 1 Level 2 Level 3 Value Marketable securities – ICC International Cannabis Corp. $ - - - $ - Marketable securities – Divsersa S.A. 218,183 - - 218,183 Marketable securities – National Bank of Greece 4,609 - - 4,609 $ 222,792 $ 222,792 December 31, 2019 Total Carrying Level 1 Level 2 Level 3 Value Marketable securities – ICC International Cannabis Corp. $ 33,000 - - $ 33,000 Marketable securities – Divsersa S.A. 200,290 - - 200,290 Marketable securities – National Bank of Greece 5,650 - - 5,650 $ 238,940 $ 238,940 FASB ASC 825-10-25 Fair Value Option, (“ASC 825-10-25”), expands opportunities to use fair value measurements in financial reporting and permits entities to choose to measure many financial instruments and certain other items at fair value. The Company did not elect the fair value options for any of its qualifying financial instruments. |
Derivative Instruments | Derivative financial instruments are recorded in the accompanying consolidated balance sheets at fair value in accordance with ASC 815. When the Company enters into a financial instrument such as a debt or equity agreement (the “host contract”), the Company assesses whether the economic characteristics of any embedded features are clearly and closely related to the primary economic characteristics of the remainder of the host contract. When it is determined that (i) an embedded feature possesses economic characteristics that are not clearly and closely related to the primary economic characteristics of the host contract, and (ii) a separate, stand-alone instrument with the same terms would meet the definition of a financial derivative instrument, then the embedded feature is bifurcated from the host contract and accounted for as a derivative instrument. The estimated fair value of the derivative feature is recorded in the accompanying consolidated balance sheets separately from the carrying value of the host contract. Subsequent changes in the estimated fair value of derivatives are recorded as a gain or loss in the Company’s consolidated statements of operations. |
Customer Advances | The Company receives prepayments from certain customers for pharmaceutical products prior to those customers taking possession of the Company’s products. The Company records these receipts as customer advances until it has met all the criteria for recognition of revenue including passing control of the products to its customer, at such point, the Company will reduce the customer and deposits balance and credit the Company’s revenues. |
Revenue Recognition | In accordance with ASC 606, Revenue from Contracts with Customers, the Company uses a five-step model for recognizing revenue by applying the following steps: (1) identify the contract with the customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when (or as) the performance obligations are satisfied by transferring the promised goods to the customer. Once these steps are met, revenue is recognized upon delivery of the product. |
Stock-based Compensation | The Company records stock-based compensation in accordance with ASC 718, Stock Compensation (“ASC 718”) and Staff Accounting Bulletin No. 107 (“SAB 107”) issued by the SEC in March 2005 regarding its interpretation of ASC 718. ASC 718 requires the fair value of all stock-based employee compensation awarded to employees to be recorded as an expense over the related requisite service period. The Company values any employee or non-employee stock-based compensation at fair value using the Black-Scholes Option Pricing Model. The Company accounts for non-employee share-based awards in accordance with the measurement and recognition criteria of ASU 2018-07, “Compensation-Stock Compensation-Improvements to Nonemployee Share-Based Payment Accounting.” |
Foreign Currency Translations and Transactions | Assets and liabilities of all foreign operations are translated at year-end rates of exchange, and the statements of operations are translated at the average rates of exchange for the year. Gains or losses resulting from translating foreign currency financial statements are accumulated in a separate component of stockholders’ equity until the entity is sold or substantially liquidated. Gains or losses from foreign currency transactions (transactions denominated in a currency other than the entity’s local currency) are included in net earnings. |
Concentrations of Credit Risk | Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash investments and accounts receivable. The following tables show the number of the Company’s clients which contributed 10% or more of revenue and accounts receivable, respectively: Year Ended December 31, Year Ended December 31, 2020 2019 Number of 10% clients 1 0 Percentage of total revenue 14.82 % n/a Percentage of total AR 14.65 % n/a |
Income Taxes | The Company accounts for income taxes under the asset and liability method, as required by the accounting standard for income taxes ASC 740. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis, as well as net operating loss carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company is liable for income taxes in Greece and the United Kingdom of England. The corporate income tax rate is 24% in Greece (tax losses are carried forward for five years effective January 1, 2013) and 19% in United Kingdom of England. Losses may also be subject to limitation under certain rules regarding change of ownership. We regularly review deferred tax assets to assess their potential realization and establish a valuation allowance for portions of such assets to reduce the carrying value if we do not consider it to be more likely than not that the deferred tax assets will be realized. Our review includes evaluating both positive (e.g., sources of taxable income) and negative (e.g., recent historical losses) evidence that could impact the realizability of our deferred tax assets. At December 31, 2020 the Company has maintained a valuation allowance against all net deferred tax assets in each jurisdiction in which it is subject to income tax. The Company periodically reviews the uncertainties and judgments related to the application of complex income tax regulations to determine income tax liabilities in several jurisdictions. The Company uses a “more likely than not” criterion for recognizing the income tax benefit of uncertain tax positions and establishing measurement criteria for income tax benefits. The Company has evaluated the impact of these positions and due to the fact that the fiscal years 2013 - 2014 are unaudited by the Greek tax authorities, a potential tax liability has not been identified because there is a limitation on periods that the Tax authorities can audit retrospectively 5 years prior to the current fiscal year. Therefore, no prospective tax audit from tax authorities may arise. The amount of the liability as of December 31, 2020 and 2019, was $0 and $79,716, respectively, and has been excluded from recording as a long-term liability within the consolidated balance sheets. |
Retirement and Termination Benefits | Under Greek labor law, employees are entitled to lump-sum compensation in the event of termination or retirement. The amount depends on the employee’s work experience and renumeration as of the day of termination or retirement. If an employee remains with the company until full-benefit retirement, the employee is entitled to a lump-sum equal to 40% of the compensation to be received if the employee were to be dismissed on the same day. The Company periodically reviews the uncertainties and judgements related to the application of the relevant labor law regulations to determine retirement and termination benefits obligations of its Greek subsidiaries. The Company has evaluated the impact of these regulations and has identified a potential retirement and termination benefits liability. The amount of the liability as of December 31, 2020 and December 31, 2019, was $107,167 and $77,170, respectively, and has been recorded as a long-term liability within the consolidated balance sheets. |
Basic and Diluted Net Income (Loss) per Common Share | Basic income per share is calculated by dividing income available to common stockholders by the weighted average number of shares of common stock outstanding during the period. Diluted income per share is calculated by dividing income available to common stockholders by the weighted average number of common shares outstanding for the period and, when dilutive, potential shares from stock options and warrants to purchase common stock, using the treasury stock method. In accordance with ASC 260, Earnings Per Share, the following table reconciles basic shares outstanding to fully diluted shares outstanding. Years Ended December 31, 2020 2019 Weighted average number of common shares outstanding Basic 13,270,097 13,273,596 Potentially dilutive common stock equivalents 37,698 - Weighted average number of common and equivalent shares outstanding – Diluted 13,307,795 13,273,596 Common stock equivalents are included in the diluted income per share calculation only when option exercise prices are lower than the average market price of the common shares for the period presented. |
Recent Accounting Pronouncements | In August 2020, the FASB issued ASU No. 2020-06 (“ASU 2020-06”) “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity.” ASU 2020-06 will simplify the accounting for convertible instruments by reducing the number of accounting models for convertible debt instruments and convertible preferred stock. Limiting the accounting models will result in fewer embedded conversion features being separately recognized from the host contract as compared with current GAAP. Convertible instruments that continue to be subject to separation models are (1) those with embedded conversion features that are not clearly and closely related to the host contract, that meet the definition of a derivative, and that do not qualify for a scope exception from derivative accounting and (2) convertible debt instruments issued with substantial premiums for which the premiums are recorded as paid-in capital. ASU 2020-06 also amends the guidance for the derivatives scope exception for contracts in an entity’s own equity to reduce form-over-substance-based accounting conclusions. ASU 2020-06 will be effective January 1, 2024, for the Company. Early adoption is permitted, but no earlier than January 1, 2021, including interim periods within that year. Management is currently evaluating the effect of the adoption of ASU 2020-06 on the consolidated financial statements. Management does not believe that any recently issued, but not effective, accounting standards, if currently adopted, would have a material effect on the Company’s consolidated financial statements. |
ORGANIZATION AND NATURE OF BU_3
ORGANIZATION AND NATURE OF BUSINESS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
ORGANIZATION AND NATURE OF BUSINESS | |
Schedule of consolidated financial statements | December 31, 2020 December 31, 2019 Exchange rate on balance sheet dates EUR: USD exchange rate 1.2230 1.1227 GBP: USD exchange rate 1.3662 1.3185 Average exchange rate for the period EUR: USD exchange rate 1.1410 1.1194 GBP: USD exchange rate 1.2829 1.2767 |
Schedule of Property and equipment | Estimated Useful Life Leasehold improvements and technical works Lesser of lease term or 40 years Vehicles 6 years Machinery 20 years Furniture, fixtures and equipment 5–10 years Computers and software 3-5 years |
Fair value a measured and recognized asset | December 31, 2020 Total Carrying Level 1 Level 2 Level 3 Value Marketable securities – ICC International Cannabis Corp. $ - - - $ - Marketable securities – Divsersa S.A. 218,183 - - 218,183 Marketable securities – National Bank of Greece 4,609 - - 4,609 $ 222,792 $ 222,792 December 31, 2019 Total Carrying Level 1 Level 2 Level 3 Value Marketable securities – ICC International Cannabis Corp. $ 33,000 - - $ 33,000 Marketable securities – Divsersa S.A. 200,290 - - 200,290 Marketable securities – National Bank of Greece 5,650 - - 5,650 $ 238,940 $ 238,940 |
Schedule of Concentrations of Credit Risk | Year Ended December 31, Year Ended December 31, 2020 2019 Number of 10% clients 1 0 Percentage of total revenue 14.82 % n/a Percentage of total AR 14.65 % n/a |
Basic and Diluted Net Loss per Common Share | Years Ended December 31, 2020 2019 Weighted average number of common shares outstanding Basic 13,270,097 13,273,596 Potentially dilutive common stock equivalents 37,698 - Weighted average number of common and equivalent shares outstanding – Diluted 13,307,795 13,273,596 |
PROPERTY AND EQUIPMENT NET (Tab
PROPERTY AND EQUIPMENT NET (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
PROPERTY AND EQUIPMENT, NET | |
Schedule of Property and equipment, net | 2020 2019 Leasehold improvements $ 560,711 $ 548,000 Vehicles 105,057 115,055 Furniture, fixtures and equipment 1,632,654 1,439,839 Computers and software 149,005 85,052 2,447,427 2,187,946 Less: Accumulated depreciation (690,214 ) (453,165 ) Total $ 1,757,213 $ 1,734,781 |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
GOODWILL AND INTANGIBLE ASSETS NET | |
Schedule of Goodwill and Intangible assets | 2020 2019 License $ 50,000 $ 50,000 Trade name /mark 36,997 36,997 Customer Base 176,793 176,793 263,790 263,790 Less: Accumulated amortization (82,981 ) (49,806 ) Subtotal 180,809 213,984 Goodwill 49,697 49,697 Total $ 230,506 $ 263,681 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
INCOME TAXES | |
Schedule of income before income tax domestic and foreign | 12/31/2020 12/31/2019 Domestic $ (2,901,276 ) $ (2,515,360 ) Foreign 4,099,597 (600,790 ) $ 1,198,321 $ (3,116,150 ) |
Schedule of provision for income taxes | 12/31/2020 12/31/2019 Current tax provision Federal $ - $ - State - - Foreign 555,965 182,815 Total current tax provision $ 555,965 $ 182,815 Deferred tax provision Domestic $ - $ - State - - Foreign (178,430 ) - Total deferred tax provision $ (178,430 ) $ - Total current provision $ 377,535 $ 182,815 |
Summary of U.S. federal statutory rate | 12/31/2020 12/31/2019 US Income (loss) before income taxes $ 1,198,321 $ (3,116,150 ) Taxes under statutory US tax rates $ 251,647 $ (654,391 ) Increase (decrease) in taxes resulting from: Increase in valuation allowance $ 216,518 $ 1,521,175 Foreign tax rate differential $ (55,540 ) $ 9,028 Permanent differences $ (218,216 ) $ 94,520 US tax on foreign income $ 604,419 $ - Prior period adjustments $ (97,829 ) $ (713,466 ) State taxes $ (323,464 ) $ (74,051 ) Income tax expense $ 377,535 $ 182,815 |
Significant components of deferred tax assets and liabilities | 12/31/2020 12/31/2019 Net operating loss carryforward $ 1,494,424 $ 1,270,650 Capital loss carryforward 801,744 801,744 Nonqualified stock options 170,297 184,545 Accrued expenses 7,389 7,389 Lease liability 247,797 - Gain on extinguishment of debt 179,958 - Depreciation 4,226 2,418 Mark to market adjustment in securities 357,829 348,422 Total deferred tax assets 3,263,664 2,615,168 Intangibles (10,729 ) (10,729 ) Right of use asset (253,818 ) Goodwill (14,473 ) (14,473 ) Total deferred tax liabilities (279,020 ) (25,202 ) Valuation allowance (2,806,214 ) (2,589,966 ) Net deferred tax assets (liabilities) $ 178,430 $ - |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
RELATED PARTY TRANSACTIONS | |
Schedule of related party notes payable | 2020 2019 Beginning Balance $ 1,375,532 $ 1,793,437 Payments (996,136 ) (382,055 ) Foreign currency translation 122,279 (35,850 ) Ending Balance $ 501,675 $ 1,375,532 |
Summary of related party loans payable | 2020 2019 Beginning Balance $ 1,026,264 $ 1,775,251 Proceeds 725,563 585,915 Payments (149,695 ) (262,226 ) Conversion of debt - (1,050,000 ) Reclassification of receivable - 2,547 Foreign currency translation 27,114 (25,223 ) Ending Balance $ 1,629,246 $ 1,026,264 |
LINES OF CREDIT (Tables)
LINES OF CREDIT (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
LINES OF CREDIT | |
Summary of lines of credit | 2020 2019 National $ 3,540,550 $ 1,940,045 Alpha 1,106,894 810,947 National - COVID 429,240 - Total $ 5,076,684 $ 2,750,992 |
CONVERTIBLE DEBT (Tables)
CONVERTIBLE DEBT (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
CONVERTIBLE DEBT | |
Summary of convertible debt | 2020 2019 Beginning balance notes 1,500,000 365,513 New notes 540,000 1,500,000 Payments (593,000 ) (365,513 ) Subtotal notes 1,447,000 1,500,000 Debt discount at year end (494,973 ) (29,509 ) Convertible debt, net of discount 952,027 1,470,491 |
Schedule of summary of the changes in fair value | Amount Balance on December 31, 2019 $ - Issuances to debt discount 456,570 Change in fair value of derivative liabilities 4,158 Balance on December 31, 2020 $ 460,728 December 31, 2020 Dividend yield 0 % Expected volatility 140.4%-142.5 % Risk free interest rate 0.11%-0.12 % Contractual terms (in years) 1.00 – 1.04 |
DEBT (Tables)
DEBT (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
DEBT | |
Summary of debt | December 31, 2020 Loan Facility Bridge Loans Trade Facility Third Party COVID Loans Total Beginning balance 3,078,442 191,287 6,245,400 2,514,595 - 12,029,724 Proceeds - - - 16,121,500 435,210 16,556,710 Payments - (191,287 ) - (5,006,115 ) - (5,230,725 ) conversion of debt (807,795 ) (807,795 ) Debt extinguishment (12,066 ) - - (192,205 ) - (204,271 ) Foreign currency translation 269,047 - 200,600 1,304 - 470,951 Reclass of long-term portion of debt (10,771,882 ) Ending Balance 3,302,100 - 6,446,000 12,631,284 435,210 12,042,712 December 31, 2019 Loan Facility Bridge Loans Trade Facility Third Party Total Beginning balance $ 3,078,442 $ 191,287 $ 6,291,199 $ 242,805 $ 9,803,733 Proceeds - - - 2,500,000 2,500,000 Payments - - - (227,912 ) (227,912 ) Foreign currency translation - - (45,799 ) (298 ) (46,097 ) Ending Balance $ 3,078,442 $ 191,287 $ 6,245,400 $ 2,514,595 $ 12,029,724 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
LEASES | |
Summary of operating leases | Maturity of Lease Liability 2021 $ 248,288 2022 218,083 2023 192,583 2024 58,704 Thereafter 220,107 Total undiscounted operating lease payments $ 937,765 Less: Imputed interest (147,023 ) Present value of operating lease liabilities $ 790,742 |
Summary of finance leases | Maturity of Lease Liability 2021 $ 105,620 2022 76,252 2023 65,939 2024 49,688 2025 16,430 Thereafter - Total undiscounted finance lease payments $ 313,929 Less: Imputed interest (35,831 ) Present value of finance lease liabilities $ 278,098 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
EARNINGS PER SHARE | |
Schedule of Basic net income loss per share | 2020 2019 Numerator for Basic and Diluted Earnings Per Share: Net income (loss) $ 820,786 $ (3,298,965 ) Denominator for Basic Earnings Per Share: Weighted Average Shares 13,270,097 13,273,596 Potentially Dilutive Common Shares 37,698 - Adjusted Weighted Average Shares 13,307,795 13,273,596 Basic and Diluted Net Income (Loss) per Share 0.06 (0.25 ) |
Schedule of diluted net loss per share | 2020 2019 Common stock warrants - - Common Stock Options - 42,808 Convertible Debt - - Total - 42,808 |
STOCK OPTIONS AND WARRANTS (Tab
STOCK OPTIONS AND WARRANTS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
STOCK OPTIONS AND WARRANTS | |
Schedule of option activity during the year | Number of Weighted Average Exercise Weighted Average Remaining Contractual Aggregate Intrinsic Options Shares Price Term Value Balance Outstanding, December 31, 2018 74,000 $ 1.32 2.47 $ 198,000 Granted - - - - Forfeited - - - - Exercised - - - - Expired - - - - Balance Outstanding, December 31, 2019 74,000 $ 1.32 1.47 $ 64,800 Granted - - - - Forfeited (12,000 ) - - - Exercised - - - - Expired - - - - Balance Outstanding, December 31, 2020 62,000 $ 1.19 0.60 $ 242,200 Exercisable, December 31, 2020 62,000 $ 1.19 0.60 $ 242,200 |
Summary of warrant activity during year | Number of Weighted Average Exercise Weighted Average Remaining Contractual Aggregate Intrinsic Warrants Shares Price Term Value Balance Outstanding, December 31, 2018 1,164,673 $ 6.41 5.01 $ - Granted - - - - Forfeited - - - - Exercised - - - - Expired - - - - Balance Outstanding, December 31, 2019 1,164,673 $ 6.41 4.01 $ - Granted - - - - Forfeited - - - - Exercised - - - - Expired - - - - Balance Outstanding, December 31, 2020 1,164,673 $ 6.41 3.01 $ 5,360 Exercisable, December 31, 2020 1,164,673 $ 6.41 3.01 $ 5,360 |
DISAGGREGATION OF REVENUE (Tabl
DISAGGREGATION OF REVENUE (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
DISAGGREGATION OF REVENUE | |
Schedule of Revenue disaggregated by country | Country 2020 2019 Croatia $ 24,840 $ 22,497 Cyprus 36,987 - Denmark 537,098 97,905 France 18,988 153,422 Georgia - 5,301 Germany 1,314,381 6,672,511 Greece 51,259,784 26,101,316 Hungary - 1,094,446 Indonesia - 7,172 Ireland 36,349 467,965 Italy 75,183 196,044 Jordan 29,635 20,144 Libya 1,028 396,333 Netherlands 188,890 846,479 Poland 29,358 307,624 Spain - - Turkey - 24,347 UK 1,853,816 3,262,880 Total $ 55,406,337 $ 39,676,385 |
ORGANIZATION AND NATURE OF BU_4
ORGANIZATION AND NATURE OF BUSINESS (Details) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Euro [Member] | ||
Average exchange rate for the period | ||
USD exchange rate | 1.2230 | 1.1227 |
USD average exchange rate | 1.1410 | 1.1194 |
GBP [Member] | ||
Average exchange rate for the period | ||
USD exchange rate | 1.3662 | 1.3185 |
USD average exchange rate | 1.2829 | 1.2767 |
ORGANIZATION AND NATURE OF BU_5
ORGANIZATION AND NATURE OF BUSINESS (Details 1) | 12 Months Ended |
Dec. 31, 2020 | |
Furniture, fixtures and equipment [Member] | Minimum [Member] | |
Estimated Useful Life | 5 years |
Furniture, fixtures and equipment [Member] | Maximum [Member] | |
Estimated Useful Life | 10 years |
Computers and software [Member] | Minimum [Member] | |
Estimated Useful Life | 3 years |
Computers and software [Member] | Maximum [Member] | |
Estimated Useful Life | 5 years |
Leasehold improvements and technical works [Member] | |
Estimated useful life, description | Lesser of lease term or 40 years |
Machinery [Member] | |
Estimated Useful Life | 20 years |
Vehicles [Member] | |
Estimated Useful Life | 6 years |
ORGANIZATION AND NATURE OF BU_6
ORGANIZATION AND NATURE OF BUSINESS (Details 2) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Fair value of assets and liabilities | $ 222,792 | $ 238,940 |
Marketable securities - ICC International Cannabis Corp. [Member] | ||
Fair value of assets and liabilities | 0 | 33,000 |
Marketable securities - Divsersa S.A. [Member] | ||
Fair value of assets and liabilities | 218,183 | 200,290 |
Marketable securities - National Bank of Greece [Member] | ||
Fair value of assets and liabilities | 4,609 | 5,650 |
Level 1 [Member] | ||
Fair value of assets and liabilities | 222,792 | 238,940 |
Level 1 [Member] | Marketable securities - ICC International Cannabis Corp. [Member] | ||
Fair value of assets and liabilities | 0 | 33,000 |
Level 1 [Member] | Marketable securities - Divsersa S.A. [Member] | ||
Fair value of assets and liabilities | 218,183 | 200,290 |
Level 1 [Member] | Marketable securities - National Bank of Greece [Member] | ||
Fair value of assets and liabilities | 4,609 | 5,650 |
Level 2 [Member] | ||
Fair value of assets and liabilities | 0 | 0 |
Level 2 [Member] | Marketable securities - ICC International Cannabis Corp. [Member] | ||
Fair value of assets and liabilities | 0 | 0 |
Level 2 [Member] | Marketable securities - Divsersa S.A. [Member] | ||
Fair value of assets and liabilities | 0 | 0 |
Level 2 [Member] | Marketable securities - National Bank of Greece [Member] | ||
Fair value of assets and liabilities | 0 | 0 |
Level 3 [Member] | ||
Fair value of assets and liabilities | 0 | 0 |
Level 3 [Member] | Marketable securities - ICC International Cannabis Corp. [Member] | ||
Fair value of assets and liabilities | 0 | 0 |
Level 3 [Member] | Marketable securities - Divsersa S.A. [Member] | ||
Fair value of assets and liabilities | 0 | 0 |
Level 3 [Member] | Marketable securities - National Bank of Greece [Member] | ||
Fair value of assets and liabilities | $ 0 | $ 0 |
ORGANIZATION AND NATURE OF BU_7
ORGANIZATION AND NATURE OF BUSINESS (Details 3) - integer | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
ORGANIZATION AND NATURE OF BUSINESS (Details) | ||
Number of 10% clients | 1 | 0 |
Percentage of total revenue | 14.82% | |
Percentage of total AR | 14.65% |
ORGANIZATION AND NATURE OF BU_8
ORGANIZATION AND NATURE OF BUSINESS (Details 4) - shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
ORGANIZATION AND NATURE OF BUSINESS (Details) | ||
Weighted average number of common shares outstanding Basic | 13,270,097 | 13,273,596 |
Potentially dilutive common stock equivalents | 37,698 | |
Weighted average number of common and equivalent shares outstanding - Diluted | 13,307,795 | 13,273,596 |
ORGANIZATION NATURE OF BUSINESS
ORGANIZATION NATURE OF BUSINESS AND GOING CONCERN (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | |||||
Nov. 21, 2017 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Sep. 29, 2018 | Feb. 28, 2017 | |
Reverse stock split, description | The Company effected a one-for-ten (1:10) reverse stock split whereby the Company decreased, by a ratio of one-for-ten (1:10) the number of issued and outstanding shares of common stock. | ||||||
Revenue | $ 55,406,337 | $ 39,676,385 | |||||
Income tax term | 5 years | ||||||
Accrued interest | $ 742,374 | 800,164 | |||||
Allowance for doubtful accounts | 715,845 | 529,252 | |||||
Other investments | 4,381 | ||||||
Sales and marketing expenses | 763,170 | 234,037 | |||||
Interest expense related party | 2,761,004 | 1,412,729 | |||||
Cash on hand | 316,094 | 52,489 | |||||
Net income (loss) | 820,786 | (3,298,965) | |||||
Working capital deficit | (5,979,870) | ||||||
Cash used in operation | 11,501,718 | ||||||
Accumulated deficit | (18,750,824) | (19,571,610) | |||||
TOTAL STOCKHOLDERS' DEFICIT | (4,161,013) | (6,460,829) | $ (3,317,450) | ||||
Prepaid expenses and other current assets | 159,198 | 136,891 | |||||
Depreciation expense | 240,886 | 201,000 | |||||
Amortization expense | 33,176 | 33,086 | |||||
Goodwill | 49,697 | 49,697 | |||||
Excluded amount from long-term liability | 0 | 79,716 | |||||
Potential retirement and termination benefits liability | $ 107,167 | 77,170 | |||||
Periodic inventory level, percentage | 100.00% | ||||||
Description of Potential retirement and termination benefits liability | If an employee remains with the company until full-benefit retirement, the employee is entitled to a lump-sum equal to 40% of the compensation to be received if the employee were to be dismissed on the same day | ||||||
Import/export license [Member] | |||||||
Estimated Useful Life | 5 years | ||||||
Bulgaria [Member] | |||||||
Total amounts in account | $ 1,651 | 4,080 | |||||
Greece [Member] | |||||||
Revenue | 51,259,784 | 26,101,316 | |||||
Total amounts in account | $ 134,935 | 10,987 | |||||
Income tax rate | 24.00% | ||||||
United Kingdom Of England [Member] | |||||||
Total amounts in account | $ 448,659 | $ 14,451 | |||||
Income tax rate | 19.00% | ||||||
Pancreta Bank [Member] | |||||||
Additional investments in equity securities | $ 4,772 | ||||||
Amplerissimo Ltd [Member] | Share Exchange Agreement [Member] | |||||||
Ownership interest sold | 100.00% | ||||||
SkyPharm [Member] | |||||||
Equity ownership percentage | 100.00% | ||||||
Decahedron Ltd [Member] | Stock Purchase Agreement [Member] | |||||||
Common stock shares reserved | 170,000 | ||||||
Diversa S.A. [Member] | |||||||
Equity method investment shares acquired, shares | 40,000 | ||||||
Equity method investment shares acquired, value | $ 218,183 | ||||||
Closing price | $ 5.45 | ||||||
National Bank of Greece [Member] | |||||||
Equity method investment shares acquired, shares | 16,666 | ||||||
Equity method investment shares acquired, value | $ 4,609 | ||||||
Closing price | $ 0.28 | ||||||
ICC International Cannabis Corp [Member] | |||||||
Equity method investment shares acquired, shares | 3,000,000 | ||||||
Equity method investment shares acquired, value | $ 0 | ||||||
Closing price | $ 0 |
MARKETABLE SECURITIES (Details
MARKETABLE SECURITIES (Details Narrative) | 1 Months Ended | 12 Months Ended | |||||
Jul. 16, 2018USD ($)shares | May 17, 2018USD ($)shares | Dec. 31, 2020USD ($)$ / sharesshares | Dec. 31, 2020CAD ($) | Dec. 31, 2020EUR (€) | Dec. 31, 2019USD ($) | Jun. 30, 2019 | |
Net unrealized loss on fair value investment | $ 2,246 | ||||||
Marketable securities - Divsersa S.A. [Member] | |||||||
Closing price of shares | $ / shares | $ 5.45 | ||||||
Shares issued as marketable securities | shares | 40,000 | ||||||
Marketable securities - National Bank of Greece [Member] | |||||||
Closing price of shares | $ / shares | $ 0.28 | ||||||
Marketable securities | $ 4,609 | ||||||
Shares issued as marketable securities | shares | 16,666 | ||||||
Stock issued during the period, amount | $ 218,183 | ||||||
Marathon Global Inc [Member] | Distribution and Equity Acquisition Agreement [Member] | |||||||
Upfront cash received | $ 2,000,000 | ||||||
Equity interest acquired description | a 33 1/3% equity interest or 5 million shares in Marathon as partial consideration for the Company’s distribution services | a 33 1/3% equity interest or 5 million shares in Marathon as partial consideration for the Company’s distribution services | a 33 1/3% equity interest or 5 million shares in Marathon as partial consideration for the Company’s distribution services | ||||
Agreement term | 5 years | 5 years | 5 years | ||||
Marathon Global Inc [Member] | Distribution and Equity Acquisition Agreement [Member] | Gross Sales One [Member] | |||||||
Cash received upon gross sales | $ 2,750,000 | ||||||
Gross sales | 13,000,000 | ||||||
Marathon Global Inc [Member] | Distribution and Equity Acquisition Agreement [Member] | Gross Sales [Member] | |||||||
Cash received upon gross sales | 2,750,000 | ||||||
Gross sales | 6,500,000 | ||||||
Marathon Global Inc [Member] | Share Exchange Agreement [Member] | |||||||
Shares of Marathon transferred by company to KBB | shares | 2,500,000 | ||||||
Gain on exchange of investment | $ 2,092,200 | $ 1,953,000 | |||||
ICC [Member] | Share Exchange Agreement [Member] | |||||||
Net unrealized loss on fair value investment | $ 13,500 | ||||||
Investement | $ 0 | $ 33,000 | |||||
Upfront cash received | $ 2,000,000 | ||||||
Equity method investment shares acquired | shares | 5,000,000 | ||||||
Description for ownership percentage | The ten million shares of ICC owned by the Company constituted approximately 7% of the 141,219,108 shares of capital stock of KBB then issued and outstanding. The Company does not have the ability to exercise significant influence over ICC | Since no value was attributed to the 33 1/3% equity ownership interest in Marathon received as consideration for the distribution services, the Company would receive variable consideration in future for its services under the Distribution and Equity Acquisition Agreement | Since no value was attributed to the 33 1/3% equity ownership interest in Marathon received as consideration for the distribution services, the Company would receive variable consideration in future for its services under the Distribution and Equity Acquisition Agreement | Since no value was attributed to the 33 1/3% equity ownership interest in Marathon received as consideration for the distribution services, the Company would receive variable consideration in future for its services under the Distribution and Equity Acquisition Agreement | |||
Additional shares issued, shares | shares | 3,000,000 | ||||||
Additional shares issued, amount | $ 0 | ||||||
Kaneh Bosm Biotechnology Inc [Member] | Share Exchange Agreement [Member] | |||||||
Transfer of shares | shares | 2,500,000 | ||||||
Kaneh Bosm Biotechnology Inc [Member] | Share Exchange Agreement [Member] | Canadian Securities Exchange [Member] | |||||||
Exchange of shares | shares | 5,000,000 | ||||||
May and July 2018 [Member] | Marathon Global Inc [Member] | |||||||
Consideration for the distribution services, shares | 5,000,000 | ||||||
Cosmo Farmacy LP [Member] | |||||||
Cash recognized | 221,457 | ||||||
Investement | $ 183,450 | $ 163,575 | |||||
Initial share capital | € | € 150,000 | ||||||
Initial share capital increased | € | 500,000 | ||||||
Pharmacy license value | € | € 350,000 | ||||||
Maturity period of license | 30 years | 30 years | 30 years | ||||
Ownership equity | 70.00% | ||||||
cash contributed to limited partner | € | € 150,000 | ||||||
Equity ownership remaining | 30.00% |
PROPERTY PLANT AND EQUIPMENT (D
PROPERTY PLANT AND EQUIPMENT (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Property plant and equipment | $ 2,447,427 | $ 2,187,946 |
Less: Accumulated depreciation | (690,214) | (453,165) |
Total | 1,757,213 | 1,734,781 |
Computers and software [Member] | ||
Property plant and equipment | 149,005 | 85,052 |
Vehicles [Member] | ||
Property plant and equipment | 105,057 | 115,055 |
Leasehold Improvements [Member] | ||
Property plant and equipment | 560,711 | 548,000 |
Furniture, fixtures and equipment [Member] | ||
Property plant and equipment | $ 1,632,654 | $ 1,439,839 |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Goodwill and intangible assets, gross | $ 263,790 | $ 263,790 |
Less: Accumulated Amortization | (82,981) | (49,806) |
Subtotal | 180,809 | 213,984 |
Goodwill | 49,697 | 49,697 |
Total | 230,506 | 263,681 |
Customer Base [Member] | ||
Goodwill and intangible assets, gross | 176,793 | 176,793 |
Trademarks and Trade Names [Member] | ||
Goodwill and intangible assets, gross | 36,997 | 36,997 |
License [Member] | ||
Goodwill and intangible assets, gross | $ 50,000 | $ 50,000 |
CAPITAL STRUCTURE (Details Narr
CAPITAL STRUCTURE (Details Narrative) - USD ($) | Feb. 05, 2019 | Jan. 07, 2019 | Nov. 30, 2020 | Oct. 31, 2020 | Sep. 30, 2020 | Aug. 31, 2020 | Jul. 31, 2020 | Jun. 20, 2019 | Feb. 18, 2019 | Nov. 30, 2018 | Dec. 31, 2020 | Dec. 31, 2019 |
Common stock, shares, outstanding | 13,069,800 | 12,860,059 | ||||||||||
Common stock, shares issued | 13,485,128 | 13,325,587 | ||||||||||
Common stock shares authorized | 300,000,000 | 300,000,000 | ||||||||||
Preferred stock shares authorized | 100,000,000 | 100,000,000 | ||||||||||
Cancellation of pre-delivery shares issued in connection with convertible debentures | 108,417 | 465,325 | ||||||||||
Stock Purchase Agreement [Member] | Shareholder [Member] | Sepetember [Member] | ||||||||||||
Common stock, shares purchased | 10,000 | |||||||||||
Common stock, purchase price | $ 4 | |||||||||||
Aggregate common stock value | $ 40,000 | |||||||||||
Payment made against shares purchased | $ 40,000 | |||||||||||
Stock Purchase Agreement [Member] | Shareholder [Member] | July [Member] | ||||||||||||
Common stock, shares purchased | 10,000 | |||||||||||
Common stock, purchase price | $ 4 | |||||||||||
Aggregate common stock value | $ 40,000 | |||||||||||
Payment made against shares purchased | 40,000 | |||||||||||
Stock Purchase Agreement [Member] | Shareholder [Member] | August [Member] | ||||||||||||
Common stock, shares purchased | 10,000 | |||||||||||
Common stock, purchase price | $ 4 | |||||||||||
Aggregate common stock value | $ 40,000 | |||||||||||
Payment made against shares purchased | 40,000 | |||||||||||
Stock Purchase Agreement [Member] | Shareholder [Member] | October [Member] | ||||||||||||
Common stock, shares purchased | 10,000 | |||||||||||
Common stock, purchase price | $ 4 | |||||||||||
Aggregate common stock value | $ 40,000 | |||||||||||
Payment made against shares purchased | 40,000 | |||||||||||
Stock Purchase Agreement [Member] | Shareholder [Member] | November [Member] | ||||||||||||
Common stock, shares purchased | 10,000 | |||||||||||
Common stock, purchase price | $ 4 | |||||||||||
Aggregate common stock value | $ 40,000 | |||||||||||
Payment made against shares purchased | 40,000 | |||||||||||
Stock Purchase Agreement [Member] | Director [Member] | ||||||||||||
Common stock, purchase price | $ 3 | |||||||||||
Consideration for stock purchase | $ 60,000 | |||||||||||
Consideration amount | $ 11,317 | $ 48,683 | ||||||||||
Purchase of treasury stock, shares | 20,000 | |||||||||||
Stock Purchase Agreement [Member] | Institutional Noteholder One [Member] | ||||||||||||
Common stock, shares purchased | 83,341 | |||||||||||
Common stock, purchase price | $ 3 | |||||||||||
Aggregate common stock value | $ 250,023 | |||||||||||
Payment made against shares purchased | $ 250,023 | |||||||||||
Cancellation and transfer of shares | 26,221 | |||||||||||
Treasury stock, shares transferred | 57,120 | |||||||||||
Stock Purchase Agreement [Member] | Institutional Noteholder [Member] | ||||||||||||
Common stock, shares purchased | 193,408 | |||||||||||
Common stock, purchase price | $ 3 | |||||||||||
Aggregate common stock value | $ 580,224 | |||||||||||
Payment made against shares purchased | $ 580,224 | |||||||||||
Cancellation and transfer of shares | 193,408 | |||||||||||
Stock Purchase Agreement [Member] | Former Officer and Director [Member] | ||||||||||||
Consideration for stock purchase | $ 15,000 | |||||||||||
Common shares repurchased by company | 114,518 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Loss before provision for income taxes | $ 1,198,321 | $ (3,116,150) |
Domestic [Member] | ||
Loss before provision for income taxes | (2,901,276) | (2,515,360) |
Foreign [Member] | ||
Loss before provision for income taxes | $ 4,099,597 | $ (600,790) |
INCOME TAXES (Details 1)
INCOME TAXES (Details 1) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Current tax provision | ||
Federal | $ 0 | $ 0 |
State | 0 | 0 |
Foreign | 555,965 | 182,815 |
Total current tax provision | 555,965 | 182,815 |
Deferred tax provision | ||
Domestic | 0 | 0 |
State | 0 | 0 |
Foreign | (178,430) | 0 |
Total deferred tax provision | (178,430) | 0 |
Total current provision | $ 377,535 | $ 182,815 |
INCOME TAXES (Details 2)
INCOME TAXES (Details 2) - US [Member] - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Income (loss) before income taxes | $ 1,198,321 | $ (3,116,150) |
Taxes under statutory US tax rates | 251,647 | (654,391) |
Increase (decrease) in taxes resulting from: | ||
Increase in valuation allowance | 216,518 | 1,521,175 |
Foreign tax rate differential | (55,540) | 9,028 |
Permanent differences | (218,216) | 94,520 |
US tax on foreign income | 604,419 | 0 |
Prior period adjustments | (97,829) | (713,466) |
State taxes | (323,464) | (74,051) |
Income tax expense | $ 377,535 | $ 182,815 |
INCOME TAXES (Details 3)
INCOME TAXES (Details 3) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Gain on extinguishment of debt | $ (942,029) | $ 0 |
Right of use asset | 833,763 | 498,180 |
Goodwill | 49,697 | 49,697 |
Deferred Income Taxes [Member] | ||
Net operating loss carryforward | 1,494,424 | 1,270,650 |
Capital loss carryforward | 801,744 | 801,744 |
Nonqualified Stock Options | 170,297 | 184,545 |
Accrued expenses | 7,389 | 7,389 |
Lease liability | 247,797 | 0 |
Gain on extinguishment of debt | 179,958 | 0 |
Depreciation | 4,226 | 2,418 |
Mark to market adjustment to securities | 357,829 | 348,422 |
Total Deferred tax assets | 3,263,664 | 2,615,168 |
Intangibles | (10,729) | (10,729) |
Right of use asset | (253,818) | 0 |
Goodwill | (14,473) | (14,473) |
Total Deferred tax liabilities | (279,020) | (25,202) |
Valuation allowance | (2,806,214) | (2,589,966) |
Net deferred tax assets (liabilities) | $ 178,430 | $ 0 |
INCOME TAXES (Details Narrative
INCOME TAXES (Details Narrative) | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Federal Statutory Income Tax Rate, description | Subject to limitation under IRC Section 382. Of the $4.1 million Federal NOL carryforwards, $2.5 million are pre-2018 and begin to expire in 2031. The remaining balance of $1.6 million, are limited to utilization of 80% of taxable income but do not have an expiration. |
United States [Member] | |
Net operating loss carry forward | $ 4,112,907 |
Expiry | 2031 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - Notes Payable - Related Party [Member] - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Beginning Balance | $ 1,375,532 | $ 1,793,437 |
Payments | (996,136) | (382,055) |
Foreign currency translation | 122,279 | (35,850) |
Ending Balance | $ 501,675 | $ 1,375,532 |
RELATED PARTY TRANSACTIONS (D_2
RELATED PARTY TRANSACTIONS (Details 1) - Loans Payable - Related Party [Member] - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Beginning Balance | $ 1,026,264 | $ 1,775,251 |
Proceeds | 725,563 | 585,915 |
Payments | (149,695) | (262,226) |
Conversion of debt | 0 | (1,050,000) |
Reclassification of receivable | 0 | 2,547 |
Foreign currency translation | 27,114 | (25,223) |
Ending Balance | $ 1,629,246 | $ 1,026,264 |
RELATED PARTY TRANSACTIONS (D_3
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | |||||
Jun. 24, 2019 | May 28, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 20, 2018 | Dec. 31, 2018 | Jul. 21, 2009 | |
Borrowing | $ 1,223,000 | $ 1,122,700 | |||||
Accrued interest | 742,374 | 800,164 | |||||
Revenue | $ 55,406,337 | $ 39,676,385 | |||||
Shares issued | 13,485,128 | 13,325,587 | |||||
Grigorios Siokas Four [Member] | |||||||
Borrowing | $ 722,762 | $ 227,000 | |||||
Grigorios Siokas Three [Member] | |||||||
Borrowing | 303,502 | 1,550,799 | |||||
Common stock shares issuable | 73,334 | 66,667 | |||||
Outstanding principal balance | 1,629,246 | $ 1,026,264 | $ 1,777,799 | ||||
Additional proceeds from debt | 325,563 | 585,914 | |||||
Repayment of loans | 149,695 | 262,226 | |||||
Foreign curreny translation | $ 30,954 | $ 25,223 | |||||
Gain on extinguishment of related party debt | $ 269,126 | $ 259,999 | |||||
Debt instrument conversion price | $ 7.50 | $ 7.50 | $ 7.50 | ||||
Debt instrument converted amount shares issued | 140,001 | ||||||
Debt instrument converted amount | $ 550,000 | $ 500,000 | $ 1,050,000 | ||||
Grigorios Siokas [Member] | |||||||
Borrowing | $ 1,718,400 | ||||||
Outstanding principal balance | $ 489,200 | 1,347,240 | |||||
Repayment of debt | 978,400 | ||||||
Accrued interest | 193,585 | 128,447 | |||||
Interest rate | 4.70% | ||||||
Maturity date | Mar. 18, 2019 | ||||||
DOC Pharma S.A. [Member] | |||||||
Foreign curreny translation | 122,279 | 35,850 | |||||
Payments to acquire businesses | 5,983,809 | 3,464,725 | |||||
Accounts payable balance | 25,346 | ||||||
Accounts receivable balance | 3,468,564 | 613,264 | |||||
Prepaid balance | 3,468,653 | 2,449,484 | |||||
Net prepaid balance | 2,424,138 | ||||||
Revenue | 2,843,260 | 873,041 | |||||
DOC Pharma S.A. [Member] | Loan Agreement [Member] | November 1, 2015 [Member] | |||||||
Outstanding principal balance | 0 | 13,472 | |||||
Accrued interest | $ 1,364 | 1,100 | |||||
Interest rate | 2.00% | ||||||
Loan payable | $ 12,662 | ||||||
Payment made for existing bills | 12,662 | ||||||
Dimitrios Goulielmos [Member] | |||||||
Outstanding principal balance | $ 12,475 | 14,820 | |||||
Repayment of debt | $ 3,669 | $ 45,245 | |||||
Officers And Directors [Member] | |||||||
Shares issued | 2,000,000 |
LINES OF CREDIT (Details)
LINES OF CREDIT (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Lines of credit | $ 5,076,684 | $ 2,750,992 |
Eurobank [Member] | ||
Lines of credit | 42,240 | 0 |
Alpha [Member] | ||
Lines of credit | 1,106,894 | 810,947 |
National [Member] | ||
Lines of credit | $ 3,540,550 | $ 1,940,045 |
LINES OF CREDIT (Details Narrat
LINES OF CREDIT (Details Narrative) - USD ($) | 12 Months Ended | ||||||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Aug. 11, 2020 | Jul. 28, 2020 | Jul. 10, 2020 | Jun. 23, 2020 | |
Borrowing | $ 1,223,000 | $ 1,122,700 | |||||
Lines of credit | $ 5,076,684 | 2,750,992 | |||||
Interest rate | 4.35% | ||||||
Interest expense | $ 3,910 | ||||||
Line of Credit [Member] | |||||||
Interest expense | 270,655 | 85,090 | |||||
Line of Credit [Member] | National Bank of Greece One [Member] | |||||||
Borrowing | $ 2,690,600 | $ 1,684,050 | |||||
Interest rate | 4.35% | 6.00% | |||||
Outstanding debt balance | $ 973,961 | $ 2,411,182 | |||||
National Bank of Greece Two [Member] | Line of Credit [Member] | |||||||
Borrowing | $ 611,500 | ||||||
Lines of credit | $ 429,240 | ||||||
Interest rate | 2.70% | ||||||
Disbursement amount | $ 75,091 | $ 48,639 | $ 483,243 | ||||
Eurobank Bank of Greece [Member] | Line of Credit [Member] | |||||||
Borrowing | $ 572,800 | ||||||
Lines of credit | $ 286,829 | ||||||
Interest rate | 8.55% | ||||||
Alpha Bank of Greece [Member] | Line of Credit [Member] | |||||||
Borrowing | $ 1,223,000 | 1,122,700 | |||||
Lines of credit | 1,106,894 | $ 810,947 | |||||
Interest rate | 6.00% | ||||||
Outstanding debt balance | $ 1,129,368 | $ 966,084 |
CONVERTIBLE DEBT (Details)
CONVERTIBLE DEBT (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
DEBT | ||
Beginning balance notes | $ 1,500,000 | $ 365,513 |
New notes | 540,000 | 1,500,000 |
Payments | (593,000) | (365,513) |
Subtotal notes | 1,447,000 | 1,500,000 |
Debt discount at year end | (494,973) | (29,509) |
Note payable net of discount | $ 952,027 | $ 1,470,491 |
CONVERTIBLE DEBT (Details 1)
CONVERTIBLE DEBT (Details 1) | 12 Months Ended |
Dec. 31, 2020USD ($) | |
DEBT | |
Balance on December 31, 2019, beginning balance | $ 0 |
Issuances to debt discount | 456,570 |
Change in fair value of derivative liabilities | 4,158 |
Balance on December 31, 2020, ending balance | $ 460,728 |
CONVERTIBLE DEBT (Details 2)
CONVERTIBLE DEBT (Details 2) | 12 Months Ended |
Dec. 31, 2020 | |
Dividend yield | 0.00% |
Maximum [Member] | |
Expected life | 1 year 15 days |
Risk-free rate | 0.12% |
Expected volatility | 142.50% |
Minimum [Member] | |
Expected life | 1 year |
Risk-free rate | 0.11% |
Expected volatility | 140.40% |
CONVERTIBLE DEBT (Details Narra
CONVERTIBLE DEBT (Details Narrative) - USD ($) | Dec. 13, 2018 | Dec. 12, 2018 | Sep. 04, 2018 | Dec. 21, 2020 | Sep. 23, 2020 | Mar. 23, 2020 | Jun. 17, 2019 | Feb. 20, 2018 | Feb. 19, 2018 | Nov. 15, 2017 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | May 31, 2019 | May 17, 2019 | Apr. 24, 2018 |
Convertible notes payable, principal amount | $ 2,680,000 | ||||||||||||||||
Common stock, par value | $ 0.001 | $ 0.001 | |||||||||||||||
Debt discount | $ 3,350,000 | ||||||||||||||||
Amortization of debt discount | $ 392,272 | $ 34,105 | $ 320,205 | $ 360,890 | |||||||||||||
Debt original issue discount | 43,000 | ||||||||||||||||
Amortization amount | 499,570 | ||||||||||||||||
Fair value of derivative liability | 460,728 | ||||||||||||||||
Change in fair value of derivative liability | 4,158 | ||||||||||||||||
Embedded derivative liability | 456,570 | ||||||||||||||||
Outstanding principal balance | 103,610 | ||||||||||||||||
Additional paid in capital | 14,333,285 | 13,525,749 | |||||||||||||||
Gain on extinguishment of debt | (942,029) | 0 | |||||||||||||||
Beneficial conversion feature | $ 0 | 120,000 | |||||||||||||||
Convertible Notes [Member] | |||||||||||||||||
Debt discount | 2,233,332 | ||||||||||||||||
Amortization of debt discount | 2,049,232 | ||||||||||||||||
Outstanding principal balance | $ 261,903 | ||||||||||||||||
Beneficial conversion feature | $ 1,333,333 | ||||||||||||||||
Conversion price | $ 3.478 | ||||||||||||||||
Exchange Agreements [Member] | Senior Note [Member] | |||||||||||||||||
Convertible notes payable, principal amount | $ 2,871,429 | ||||||||||||||||
Common stock, par value | $ 5 | ||||||||||||||||
Convertible debt, description | The Company evaluated the debt modification in accordance with ASC 470-50 and concluded that the debt qualified for debt extinguishment as the 10% cash flow test was met. | ||||||||||||||||
Event of default conversion price, description | Upon an Event of Default (as defined), the Buyers may convert at an alternative conversion price equal to the lower of the then applicable Conversion Price or seventy-five (75%) percent of the Volume-Weighted Average Price (as defined, the “VWAP”). | ||||||||||||||||
Cash proceeds received by holders | 85.00% | ||||||||||||||||
Additional paid in capital | $ 1,140,711 | ||||||||||||||||
Aggregate indebtedness | $ 12,000,000 | ||||||||||||||||
Per-delivery shares issued | 670,001 | ||||||||||||||||
Third Amendment and Exchange Agreements [Member] | |||||||||||||||||
Convertible notes payable, principal amount | $ 261,903 | ||||||||||||||||
Exercise price | 6.00 | ||||||||||||||||
Conversion price | $ 3.478 | ||||||||||||||||
Repayment of principal | $ 638,095 | ||||||||||||||||
Warrants retired | 536,000 | ||||||||||||||||
Forbearance and Amendment Agreement [Member] | |||||||||||||||||
Exercise price | 6.0 | ||||||||||||||||
Prepayment amount | $ 63,000 | $ 100,000 | |||||||||||||||
Aggregate outstanding amount | 480,000 | $ 200,000 | |||||||||||||||
Remaining outstanding amount | $ 607,000 | ||||||||||||||||
Event of default descriptions | The Note provides that upon an Event of Default, the Buyer may, among other things, require the Company to redeem all or a portion of the Note at a redemption premium of 120%, multiplied by the product of the conversion rate ($6.00per share) and the then current market price. | ||||||||||||||||
Breach of agreement description | the time of any breach by the Company of the Agreement or the occurrence of an Event of Default that is not an Existing Default (the “Forbearance Expiration Date), (b) during the Forbearance Period (as defined) waive the prepayment premium to any Company Optional Redemption (which will result in the 120% redemption premium effectively replaced with 100%), and (c) during the Forbearance Period, waive the repayment in full of the Note other than the Required Payments (as defined) prior to June 16, 2021. | ||||||||||||||||
Securities Purchase Agreement [Member] | Warrants [Member] | |||||||||||||||||
Common stock, par value | $ 5 | ||||||||||||||||
Debt original issue discount | $ 233,332 | ||||||||||||||||
Proceeds from issuance of warrants | $ 2,686,000 | ||||||||||||||||
Legal fees | $ 74,000 | ||||||||||||||||
Maturity period | 5 years | ||||||||||||||||
Common stock shares issuable upon conversion of debt/convertible securities | 357,334 | 536,000 | 536,000 | ||||||||||||||
Securities Purchase Agreement [Member] | InstitutionalInvestor [Member] | |||||||||||||||||
Convertible notes payable, principal amount | $ 1,500,000 | ||||||||||||||||
Common stock, par value | $ 0.001 | ||||||||||||||||
Legal fees | $ 30,000 | ||||||||||||||||
Cash commission description | Roth Capital Partners, LLC (“Roth”), as the Company’s exclusive placement agent, received a cash commission for this transaction equal to six (6%) percent of the total gross proceeds of the offering. This 6% fee or $90,000 was recorded as debt discount along with the $30,000 in legal fees associated with the May 2019 Note. | ||||||||||||||||
Securities Purchase Agreement [Member] | September 2018 Notes [Member] | Holder [Member] | |||||||||||||||||
Common stock, par value | $ 6 | ||||||||||||||||
Debt original issue discount | $ 934,922 | ||||||||||||||||
Event of default conversion price, description | Upon an Event of Default (regardless of whether such event has been cured), the Buyers may convert at an alternative conversion price equal to the lower of the then applicable Conversion Price or seventy-five (75%) percent of the then Volume-Weighted Average Price (as defined, the “VWAP”). | ||||||||||||||||
Per-delivery shares issued | 372,222 | ||||||||||||||||
Debt instrument maturity date | Nov. 1, 2018 | ||||||||||||||||
Customary events of default, description | The Note at a redemption premium of one hundred twenty-five (125%) percent, multiplied by the greater of the conversion rate and the then current market price. The Buyer may also require redemption of the May 2019 Note upon a Change of Control (as defined) at a premium of one hundred twenty-five (125%) percent. The Company has the right to redeem the May 2019 Note at any time, in whole or in part, in cash at a price equal to 120% of the then outstanding conversion amount. | ||||||||||||||||
Securities Purchase Agreement [Member] | May 2019 Note [Member] | Holder [Member] | |||||||||||||||||
Convertible notes payable, principal amount | $ 1,500,000 | $ 907,000 | |||||||||||||||
Event of default conversion price, description | Upon an Event of Default (regardless of whether such event has been cured), the Buyer may convert at an alternative conversion price equal to the lower of the then applicable Conversion Price or seventy-five (75%) percent of the then Volume-Weighted Average Price (as defined, the “VWAP”). | ||||||||||||||||
Common stock shares issuable upon conversion of debt/convertible securities | 250,000 | ||||||||||||||||
Conversion price | $ 6 | $ 3.478 | |||||||||||||||
Payment amount to related party | $ 12,000,000 | ||||||||||||||||
Customary events of default, description | 2019 Note includes customary Events of Default and provides that the Buyer may require the Company to redeem (regardless of whether the Event of Default has been cured) all or a portion of the Note at a redemption premium equal to the greater of: (i) the product of the redemption premium of one hundred twenty-five (125%) percent, multiplied by the conversion amount, and (ii) the product of the conversion rate ($6.00 per share) multiplied by the product of 125% multiplied by the then current market price. The Buyer may also require redemption of the May 2019 Note upon a Change of Control (as defined) at a premium of one hundred twenty-five (125%) percent. The Company has the right to redeem the May 2019 Note at any time, in whole or in part, in cash at a price equal to 120% of the then outstanding conversion amount. | ||||||||||||||||
Terms of Blocker Provision | Common stock would exceed 9.99% of the Company’s issued and outstanding common stock. | ||||||||||||||||
Accrued expense | 25,334 | $ 15,420 | |||||||||||||||
Repayment of amount | $ 593,000 | ||||||||||||||||
Securities Purchase Agreement [Member] | Senior Note [Member] | |||||||||||||||||
Common stock, par value | $ 0.001 | ||||||||||||||||
Debt original issue discount | $ 350,000 | ||||||||||||||||
Purchase price charged to financing costs | 240,000 | ||||||||||||||||
Purchase price of financing cost | $ 3,000,000 | ||||||||||||||||
Common stock shares issuable upon conversion of debt/convertible securities | 670,000 | ||||||||||||||||
November 15, 2017 Securities Purchase Agreement [Member] | Third Amendment and Exchange Agreements [Member] | |||||||||||||||||
Debt instrument maturity date | Dec. 11, 2023 | ||||||||||||||||
Warrants issued | 727,683 | ||||||||||||||||
September 4, 2018 Securities Purchase Agreement [Member] | Third Amendment and Exchange Agreements [Member] | |||||||||||||||||
Conversion price | $ 3.478 | ||||||||||||||||
Related Party Debt | $ 1,333,333 | ||||||||||||||||
Debt modification expense | $ 1,778,952 | ||||||||||||||||
Common stock issued | 383,363 | ||||||||||||||||
Institutional investors [Member] | Securities Purchase Agreement [Member] | September 2018 Notes [Member] | |||||||||||||||||
Convertible notes payable, principal amount | $ 2,233,333 | ||||||||||||||||
Common stock, par value | $ 0.001 | ||||||||||||||||
Common stock shares issuable upon conversion of debt/convertible securities | 372,223 | ||||||||||||||||
Proceeds from issuance of warrants | $ 1,845,000 | ||||||||||||||||
Legal fees | $ 15,000 | ||||||||||||||||
Debt instrument maturity date | May 1, 2019 | ||||||||||||||||
Purchase price charged to financing costs | $ 140,000 | ||||||||||||||||
Purchase price of financing cost | $ 2,000,000 | ||||||||||||||||
Exercise price | 7.50 | ||||||||||||||||
Placement agent [Member] | Roth Capital Partners, LLC [Member] | |||||||||||||||||
Amortization of debt discount | $ 184,100 | ||||||||||||||||
Proceeds from issuance of warrants | $ 140,000 | ||||||||||||||||
Debt instrument maturity date | Mar. 4, 2019 | ||||||||||||||||
Terms of Blocker Provision | Will receive seven (7%) percent of any cash proceeds received from the exercise of any Warrants sold in the offering with an expiration equal to or less than twenty-four (24) months. | ||||||||||||||||
Fair Value of Warrants | $ 157,969 | ||||||||||||||||
Interest Rate | 5.00% | ||||||||||||||||
Maturity period | 5 years | ||||||||||||||||
Placement agent [Member] | Roth Capital Partners, LLC [Member] | Warrants [Member] | |||||||||||||||||
Debt original issue discount | $ 140,000 | ||||||||||||||||
Common stock shares issuable upon conversion of debt/convertible securities | 26,056 | ||||||||||||||||
Warrants exercise price | $ 6 | ||||||||||||||||
Senior Convertible Note 1 [Member] | Institutional investors [Member] | Securities Purchase Agreement [Member] | |||||||||||||||||
Convertible notes payable, principal amount | $ 3,000,000 | ||||||||||||||||
Senior Convertible Note 2 [Member] | Institutional investors [Member] | Securities Purchase Agreement [Member] | |||||||||||||||||
Convertible notes payable, principal amount | $ 3,350,000 | ||||||||||||||||
New Notes [Member] | Exchange Agreements [Member] | |||||||||||||||||
Convertible notes payable, principal amount | $ 3,216,000 | ||||||||||||||||
Debt discount | 3,216,000 | 1,140,711 | $ 3,216,000 | ||||||||||||||
Amortization of debt discount | $ 405,743 | $ 45,613 | $ 3,170,386 | ||||||||||||||
Debt original issue discount | 336,000 | ||||||||||||||||
Gain on extinguishment of debt | 1,464,698 | ||||||||||||||||
Beneficial conversion feature | 2,880,000 | ||||||||||||||||
Adjustments to beneficial conversion feature and issue of debt discount | $ 1,739,289 | ||||||||||||||||
Convertible Promissory Note [Member] | Securities Purchase Agreement [Member] | |||||||||||||||||
Debt original issue discount | $ 40,000 | ||||||||||||||||
Event of default conversion price, description | The Conversion Price shall equal the Variable Conversion Price (subject to stock splits, dividends, rights offerings or similar events) shall mean seventy-five percent (75%) multiplied by the Market Price defined as the average of the three (3) lowest trading prices for common stock during the fifteen (15) trading day period ending on the latest complete trading day prior to the conversion date. | ||||||||||||||||
Event of default descriptions | Note since inception shall be the Interest Rate plus eighteen percent (18.0%), the Default Interest. Unless previously converted, the principal and accrued interest on the Note is due and payable in cash (USD) upon the earlier of (i) December 31, 2021, (ii) a Change of Control (as defined below) or (iii), an Event of Default (as defined below) (collectively, the “Maturity Date”). | ||||||||||||||||
Financing cost | $ 3,000 | ||||||||||||||||
Interest rate | 8.00% | ||||||||||||||||
Note issued | $ 540,000 | ||||||||||||||||
Note issued upon exchange for cash | $ 500,000 | ||||||||||||||||
Convertible Notes [Member] | September 2018 [Member] | |||||||||||||||||
Interest Rate | 5.00% | 5.00% | |||||||||||||||
Installment fees | $ 13,097 | $ 31,905 |
DEBT (Details)
DEBT (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Beginning balance loans | $ 12,029,724 | $ 9,803,733 |
Proceeds | 16,556,710 | 2,500,000 |
Conversion of debt | (807,795) | |
Payments | (5,230,725) | (227,912) |
Reclass of long-term portion of debt | (10,771,882) | |
Debt extinguishment | (204,271) | 0 |
Foreign currency translation | 470,951 | (46,097) |
Ending balance loans | 12,042,712 | 12,029,724 |
Bridge Loans [Member] | ||
Proceeds | 0 | 0 |
Debt extinguishment | 0 | 0 |
Beginning balance loans | 191,287 | 191,287 |
Payments | (191,287) | 0 |
Foreign currency translation | 0 | 0 |
Ending balance loans | 0 | 191,287 |
Loan Facility [Member] | ||
Proceeds | 0 | 0 |
Debt extinguishment | 749,824 | 0 |
Payments | 0 | 0 |
Beginning balance loans | 3,078,442 | 3,078,442 |
Foreign currency translation | 269,047 | 0 |
Ending balance loans | 3,302,100 | 3,078,442 |
Third Party [Member] | ||
Conversion of debt | (807,795) | |
Debt extinguishment | (192,205) | 0 |
Payments | (5,006,115) | (227,912) |
Beginning balance loans | 2,514,595 | 242,805 |
Proceeds | 16,121,500 | 2,500,000 |
Foreign currency translation | 1,304 | (298) |
Ending balance loans | 12,631,284 | 2,514,595 |
COVID Loans [Member] | ||
Beginning balance loans | 0 | 0 |
Proceeds | 435,210 | 0 |
Payments | 0 | 0 |
Debt extinguishment | 0 | 0 |
Foreign currency translation | 0 | 0 |
Ending balance loans | 435,210 | 0 |
Trade Facility [Member] | ||
Proceeds | 0 | 0 |
Payments | 0 | 0 |
Beginning balance loans | 6,245,400 | 6,291,199 |
Foreign currency translation | 200,600 | (45,799) |
Ending balance loans | $ 64,446,000 | $ 6,245,400 |
DEBT (Details Narrative)
DEBT (Details Narrative) - USD ($) | Aug. 04, 2020 | May 12, 2020 | May 08, 2020 | May 05, 2020 | Dec. 06, 2019 | May 12, 2018 | May 12, 2017 | Apr. 10, 2017 | Mar. 16, 2017 | Aug. 04, 2016 | Nov. 19, 2020 | Jun. 24, 2020 | May 18, 2020 | Apr. 23, 2020 | Mar. 23, 2020 | Feb. 27, 2020 | Feb. 25, 2020 | Jan. 27, 2020 | Dec. 19, 2018 | Oct. 17, 2018 | May 31, 2018 | Mar. 20, 2017 | Nov. 16, 2015 | Dec. 31, 2020 | Dec. 30, 2020 | Dec. 31, 2019 | Dec. 20, 2018 | Oct. 29, 2020 | Jul. 03, 2020 | Dec. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Nov. 16, 2017 | Jul. 31, 2017 | Mar. 23, 2017 | Jan. 31, 2017 | Dec. 31, 2016 | Nov. 30, 2016 | Oct. 31, 2016 | Sep. 30, 2016 | Sep. 13, 2016 |
Loan received from related party | $ 366,900 | $ 68,310 | |||||||||||||||||||||||||||||||||||||||
Decription of loan payment for interest | The loan will be repaid in 40 equal monthly instalments beginning on January 1, 2022 and bears an interest rate of 0.94% per annum. | The loan has a six-year maturity and bears interest at a rate of 2.5% per annum beginning 12-months after the initial disbursement. | |||||||||||||||||||||||||||||||||||||||
Accured interest expense | $ 3,910 | ||||||||||||||||||||||||||||||||||||||||
Convertible notes payable, principal amount | $ 2,680,000 | ||||||||||||||||||||||||||||||||||||||||
Gain on extingushment of debt, total | $ (204,271) | $ 0 | |||||||||||||||||||||||||||||||||||||||
Shares issued | 13,485,128 | 13,325,587 | |||||||||||||||||||||||||||||||||||||||
Trade Facility [Member] | |||||||||||||||||||||||||||||||||||||||||
Payment of interest and principal | $ 1,123,600 | ||||||||||||||||||||||||||||||||||||||||
July 24, 2019 [Member] | Senior Promissory Notes [Member] | |||||||||||||||||||||||||||||||||||||||||
Debt outstanding amount | $ 750,000 | ||||||||||||||||||||||||||||||||||||||||
Maturity date | Jul. 24, 2021 | ||||||||||||||||||||||||||||||||||||||||
Accured interest expense | $ 158,429 | $ 49,625 | |||||||||||||||||||||||||||||||||||||||
Interest rate | 15.00% | ||||||||||||||||||||||||||||||||||||||||
Convertible notes payable, principal amount | $ 750,000 | ||||||||||||||||||||||||||||||||||||||||
Due to related party | 750,000 | 750,000 | |||||||||||||||||||||||||||||||||||||||
October 23, 2019 [Member] | Senior Promissory Notes [Member] | |||||||||||||||||||||||||||||||||||||||||
Debt outstanding amount | $ 250,000 | ||||||||||||||||||||||||||||||||||||||||
Maturity date | Oct. 23, 2020 | ||||||||||||||||||||||||||||||||||||||||
Convertible notes payable, principal amount | $ 250,000 | 250,000 | |||||||||||||||||||||||||||||||||||||||
Accrued expenses | 43,971 | 7,705 | |||||||||||||||||||||||||||||||||||||||
Loans payable | $ 2,000,000 | ||||||||||||||||||||||||||||||||||||||||
Interest rate | 15.00% | ||||||||||||||||||||||||||||||||||||||||
August 4, 2020 [Member] | Senior Promissory Notes [Member] | |||||||||||||||||||||||||||||||||||||||||
Debt outstanding amount | $ 3,000,000 | ||||||||||||||||||||||||||||||||||||||||
Convertible notes payable, principal amount | $ 3,000,000 | ||||||||||||||||||||||||||||||||||||||||
Interest rate | 18.00% | ||||||||||||||||||||||||||||||||||||||||
July 3, 2020 [Member] | Senior Promissory Notes [Member] | |||||||||||||||||||||||||||||||||||||||||
Debt outstanding amount | $ 5,000,000 | $ 5,000,000 | |||||||||||||||||||||||||||||||||||||||
Interest rate | 18.00% | ||||||||||||||||||||||||||||||||||||||||
Accrued expenses | $ 148,685 | ||||||||||||||||||||||||||||||||||||||||
August 1, 2019 [Member] | Senior Promissory Notes [Member] | |||||||||||||||||||||||||||||||||||||||||
Maturity date | Aug. 1, 2020 | ||||||||||||||||||||||||||||||||||||||||
Accured interest expense | $ 103,972 | ||||||||||||||||||||||||||||||||||||||||
Convertible notes payable, principal amount | 500,000 | 500,000 | |||||||||||||||||||||||||||||||||||||||
Accrued expenses | 107,972 | 31,438 | |||||||||||||||||||||||||||||||||||||||
Loans payable | $ 1,500,000 | ||||||||||||||||||||||||||||||||||||||||
Interest rate | 15.00% | ||||||||||||||||||||||||||||||||||||||||
On April 18, 2018 [Member] | |||||||||||||||||||||||||||||||||||||||||
Maturity date | Dec. 31, 2021 | ||||||||||||||||||||||||||||||||||||||||
Gain on debt settlement | $ 23,354 | ||||||||||||||||||||||||||||||||||||||||
Libor rate description | Additionally, the interest rate was amended such that the interest rate for all advances is 4% plus the 3-Month Libor rate | ||||||||||||||||||||||||||||||||||||||||
March 23, 2020 Forbearance Agreement [Member] | Senior Promissory Notes [Member] | |||||||||||||||||||||||||||||||||||||||||
Convertible notes payable, principal amount | $ 1,500,000 | ||||||||||||||||||||||||||||||||||||||||
May 5, 2020 [Member] | Senior Promissory Notes [Member] | |||||||||||||||||||||||||||||||||||||||||
Convertible notes payable, principal amount | 2,000,000 | ||||||||||||||||||||||||||||||||||||||||
On May 8, 2020 [Member] | Senior Promissory Notes [Member] | |||||||||||||||||||||||||||||||||||||||||
Convertible notes payable, principal amount | 200,000 | ||||||||||||||||||||||||||||||||||||||||
On April 23, 2020[Member] | Senior Promissory Notes [Member] | |||||||||||||||||||||||||||||||||||||||||
Convertible notes payable, principal amount | 200,000 | ||||||||||||||||||||||||||||||||||||||||
Loan Facility July 6, 2017 [Member] | |||||||||||||||||||||||||||||||||||||||||
Fees forgiven related to advance | 40,000 | ||||||||||||||||||||||||||||||||||||||||
Bridge Loans [Member] | |||||||||||||||||||||||||||||||||||||||||
Gain on extingushment of debt, total | 0 | 0 | |||||||||||||||||||||||||||||||||||||||
Loan Facility [Member] | |||||||||||||||||||||||||||||||||||||||||
Debt outstanding amount | 3,302,100 | ||||||||||||||||||||||||||||||||||||||||
Notes payable long term | 2,843,475 | ||||||||||||||||||||||||||||||||||||||||
Accrued interest expense | $ 33,021 | ||||||||||||||||||||||||||||||||||||||||
Description of loan repayement | In accordance with the settlement agreement, interest will accrue from June 30, 2020 until repayment in full at a rate of 6% per annum for the first year and 5.25% per annum for the second year calculated on the balance outstanding from day to day during such period. Interest is due on the 10th day of each calendar month. If any amount, principal or interest is unpaid on its due date interest shall accrue from the due date until the date of its payment until the date of its payment in full at the rate of 7.25% per annum. The Company will make quarterly payments of €125,000 beginning May 6, 2021 with a final payment of €2,200,000 on May 6, 2022. The Company evaluated the settlement agreement for debt modification in accordance with ASC 470-50 and concluded the debt qualified for debt extinguishment as the 10% cash flow test was met. As a result, the $3,772,446 of principal and accrued interest was written off and the new debt was recorded at fair value as of June 30, 2020 in the amount of $3,033,990. | ||||||||||||||||||||||||||||||||||||||||
Gain on extingushment of debt, principal of loan | $ 12,066 | ||||||||||||||||||||||||||||||||||||||||
Gain on extingushment of debt, total | $ 749,824 | 0 | |||||||||||||||||||||||||||||||||||||||
Restricted shares | 1,000,000 | ||||||||||||||||||||||||||||||||||||||||
Marathon [Member] | |||||||||||||||||||||||||||||||||||||||||
Shares issued for settlement of debt | 298,875 | ||||||||||||||||||||||||||||||||||||||||
Distribution and equity acquisition agreement, description | As consideration for its services, Company received: (a) a 33 1/3% equity interest or 5 million shares in Marathon as partial consideration for the Company’s distribution services; and (b) received cash of CAD $2,000,000, subject to repayment in Common Shares of the Company if it fails to meet certain performance milestones. The Company is entitled to receive an additional CAD $2,750,000 upon the Company’s receipt of gross sales of CAD $6,500,000 and an additional CAD $2,750,000 upon receipt of gross sales of CAD $13,000,000. | ||||||||||||||||||||||||||||||||||||||||
Settlement amount | $ 1,554,590 | ||||||||||||||||||||||||||||||||||||||||
Cash received | 2,000,000 | ||||||||||||||||||||||||||||||||||||||||
Grigorios Siokas [Member] | |||||||||||||||||||||||||||||||||||||||||
Maturity date | Mar. 18, 2019 | ||||||||||||||||||||||||||||||||||||||||
Interest rate | 4.70% | ||||||||||||||||||||||||||||||||||||||||
Repayment of debt | 978,400 | ||||||||||||||||||||||||||||||||||||||||
Grigorios Siokas [Member] | Senior Promissory Note [Member] | February and March 2020 Notes [Member] | |||||||||||||||||||||||||||||||||||||||||
Debt outstanding amount | $ 35,000 | $ 25,000 | 25,000 | ||||||||||||||||||||||||||||||||||||||
Maturity date | Dec. 31, 2020 | Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||
Accured interest expense | $ 3,963 | ||||||||||||||||||||||||||||||||||||||||
Description of new maturity date | new maturity date for the note is now December 31, 2020.Additionally, the interest rate was changed to 10% per annum and the Company may now prepay the January Note at any time without penalty. | new maturity date for the note is now December 31, 2020.Additionally, the interest rate was changed to 10% per annum and the Company may now prepay the January Note at any time without penalty. | |||||||||||||||||||||||||||||||||||||||
Interest rate | 5.00% | ||||||||||||||||||||||||||||||||||||||||
Grigorios Siokas [Member] | Senior Promissory Note [Member] | February Note [Member] | |||||||||||||||||||||||||||||||||||||||||
Debt outstanding amount | $ 1,000,000 | ||||||||||||||||||||||||||||||||||||||||
Maturity date | Apr. 30, 2020 | Apr. 20, 2017 | |||||||||||||||||||||||||||||||||||||||
Interest rate | 18.00% | ||||||||||||||||||||||||||||||||||||||||
Grigorios Siokas [Member] | Senior Promissory Note [Member] | January 27, Note [Member] | |||||||||||||||||||||||||||||||||||||||||
Debt outstanding amount | $ 250,000 | ||||||||||||||||||||||||||||||||||||||||
Maturity date | May 15, 2020 | ||||||||||||||||||||||||||||||||||||||||
Description of new maturity date | new maturity date for the note is now December 31, 2020.Additionally, the interest rate was changed to 10% per annum and the Company may now prepay the January Note at any time without penalty. | ||||||||||||||||||||||||||||||||||||||||
Interest rate | 5.00% | ||||||||||||||||||||||||||||||||||||||||
Accrued expenses | 18,458 | ||||||||||||||||||||||||||||||||||||||||
Loans payable | 2,500,000 | ||||||||||||||||||||||||||||||||||||||||
Unaffiliated Third Party [Member] | Senior Promissory Notes [Member] | |||||||||||||||||||||||||||||||||||||||||
Debt outstanding amount | $ 3,000,000 | $ 2,000,000 | $ 2,000,000 | $ 2,000,000 | $ 200,000 | ||||||||||||||||||||||||||||||||||||
Accrued expenses | 2,772 | ||||||||||||||||||||||||||||||||||||||||
Loans payable | $ 3,000,000 | $ 1,000,000 | $ 2,750,000 | ||||||||||||||||||||||||||||||||||||||
Description of loan repayment | The August 4 Note bears interest at the rate of eighteen (18%) percent per annum, paid quarterly in arrears. The August 4 Note matures on December 31, 2020 unless in default. | The May 8 Note bears interest at the rate of eighteen (18%) percent per annum, paid quarterly in arrears. The May 8 Note matured on June 8, 2020. | The May 5 Note bears interest at the rate of eighteen (18%) percent per annum, paid quarterly in arrears. The May 5 Note matured on December 31, 2020. | The May 18 Note bears interest at the rate of eighteen (18%) percent per annum, paid quarterly in arrears. The May 18 Note matured on December 31, 2020. The note is not in default and the Company is currently in negotiations with the lender to extend the maturity date. | The April Note bears interest at the rate of five (5%) percent per annum through May 31, 2020 and then shall change to 1% per annum effective June 1, 2020 paid quarterly in arrears. The April Note matures on December 31, 2020 unless in default. The Company may prepay the April Note within the first six (6) months by payment of unpaid interest for the first six (6) months and, after six (6) months, with a two (2%) percent ($4,000) premium. | The Company transferred the Euro €2,000,000 loan to a new third-party lender. The terms remained the same except interest will now accrue at 5.5% per annum plus Euribor. The principal is to be repaid in a total of five quarterly installments beginning October 31, 2021 of 50,000 Euro each with a final repayment of 1,800,000 Euro payable on the earlier of 24 months after December 30, 2020 or October 31, 2022. | |||||||||||||||||||||||||||||||||||
Unaffiliated Third Party [Member] | Senior Promissory Notes [Member] | December 6, 2019 [Member] | |||||||||||||||||||||||||||||||||||||||||
Debt outstanding amount | $ 250,000 | 250,000 | 250,000 | ||||||||||||||||||||||||||||||||||||||
Maturity date | Mar. 31, 2020 | Apr. 16, 2017 | Apr. 20, 2017 | ||||||||||||||||||||||||||||||||||||||
Accured interest expense | 21,952 | 890 | |||||||||||||||||||||||||||||||||||||||
Description of new maturity date | new maturity date for the note is now December 31, 2020. Additionally, the interest rate changed to 10% per annum from March 31, 2020 through maturity and the Company may now prepay the December Note at any time without penalty | ||||||||||||||||||||||||||||||||||||||||
Interest rate | 15.00% | 10.00% | 10.00% | ||||||||||||||||||||||||||||||||||||||
Short term debt borrowing capacity | $ 2,250,000 | $ 50,000 | $ 120,220 | ||||||||||||||||||||||||||||||||||||||
Convertible notes payable, principal amount | $ 250,000 | 250,000 | 250,000 | ||||||||||||||||||||||||||||||||||||||
Unaffiliated Third Party [Member] | Senior Promissory Notes [Member] | April 1 to 3, 2019 [Member] | |||||||||||||||||||||||||||||||||||||||||
Debt outstanding amount | $ 250,000 | 250,000 | |||||||||||||||||||||||||||||||||||||||
Maturity date | Apr. 3, 2021 | ||||||||||||||||||||||||||||||||||||||||
Accured interest expense | $ 64,364 | 46,026 | |||||||||||||||||||||||||||||||||||||||
Interest rate | 15.00% | ||||||||||||||||||||||||||||||||||||||||
Convertible notes payable, principal amount | $ 250,000 | 250,000 | |||||||||||||||||||||||||||||||||||||||
Accrued expenses | 64,364 | 28,098 | |||||||||||||||||||||||||||||||||||||||
Other expenses accrued | 9,452 | ||||||||||||||||||||||||||||||||||||||||
Unaffiliated Third Party [Member] | Senior Promissory Notes [Member] | April 9, 2019 [Member] | |||||||||||||||||||||||||||||||||||||||||
Debt outstanding amount | $ 250,000 | ||||||||||||||||||||||||||||||||||||||||
Maturity date | Apr. 9, 2021 | ||||||||||||||||||||||||||||||||||||||||
Interest rate | 15.00% | ||||||||||||||||||||||||||||||||||||||||
Convertible notes payable, principal amount | $ 250,000 | 250,000 | |||||||||||||||||||||||||||||||||||||||
Accrued expenses | 63,697 | 27,431 | |||||||||||||||||||||||||||||||||||||||
Due from related party | 500,000 | ||||||||||||||||||||||||||||||||||||||||
Unaffiliated Third Party [Member] | Senior Promissory Notes [Member] | October 23, 2019 [Member] | |||||||||||||||||||||||||||||||||||||||||
Convertible notes payable, principal amount | 250,000 | ||||||||||||||||||||||||||||||||||||||||
Unaffiliated Third Party [Member] | Senior Promissory Notes [Member] | April 1, 2019 [Member] | |||||||||||||||||||||||||||||||||||||||||
Convertible notes payable, principal amount | 250,000 | ||||||||||||||||||||||||||||||||||||||||
SkyPharm [Member] | Trade Facility [Member] | |||||||||||||||||||||||||||||||||||||||||
Debt outstanding amount | $ 5,369,678 | ||||||||||||||||||||||||||||||||||||||||
Short term debt borrowing capacity | $ 2,446,400 | ||||||||||||||||||||||||||||||||||||||||
Description for the repayment | The total facility will be calculated as 95% of the agreed upon value of Decahedron’s receivables. | ||||||||||||||||||||||||||||||||||||||||
Term of credit facility | 12 months | ||||||||||||||||||||||||||||||||||||||||
Credit facility origination fee, percentage | 2.00% | ||||||||||||||||||||||||||||||||||||||||
Monthly credit fee, percentage | 1.00% | ||||||||||||||||||||||||||||||||||||||||
Proceeds from debt | $ 247,117 | ||||||||||||||||||||||||||||||||||||||||
SkyPharm [Member] | Trade Facility [Member] | Minimum [Member] | |||||||||||||||||||||||||||||||||||||||||
Short term debt borrowing capacity | $ 2,291,200 | ||||||||||||||||||||||||||||||||||||||||
SkyPharm [Member] | Trade Facility [Member] | Maximum [Member] | |||||||||||||||||||||||||||||||||||||||||
Short term debt borrowing capacity | $ 6,736,200 | ||||||||||||||||||||||||||||||||||||||||
SkyPharm [Member] | Bridge Loans [Member] | |||||||||||||||||||||||||||||||||||||||||
Debt outstanding amount | 106,542 | ||||||||||||||||||||||||||||||||||||||||
Short term debt borrowing capacity | 50,000 | ||||||||||||||||||||||||||||||||||||||||
Accrued expenses | 27,627 | ||||||||||||||||||||||||||||||||||||||||
SkyPharm [Member] | Loan Facility [Member] | |||||||||||||||||||||||||||||||||||||||||
Interest rate | 10.00% | ||||||||||||||||||||||||||||||||||||||||
Short term debt borrowing capacity | $ 1,292,769 | ||||||||||||||||||||||||||||||||||||||||
Description for the repayment | No prepayment is permitted pursuant to the terms of the Loan Facility. The Synthesis Facility Agreement as amended is secured by a personal guaranty of Grigorios Siokas, which is secured by a pledge of 1,000,000 shares of common stock of the Company owned by Mr. Siokas. | ||||||||||||||||||||||||||||||||||||||||
SkyPharm [Member] | Second amendment to loan facility agreement [Member] | |||||||||||||||||||||||||||||||||||||||||
Debt outstanding amount | 3,078,442 | ||||||||||||||||||||||||||||||||||||||||
Short term debt borrowing capacity | $ 70,000 | $ 382,327 | $ 2,664,960 | $ 155,516 | $ 452,471 | $ 250,000 | $ 100,000 | $ 174,000 | |||||||||||||||||||||||||||||||||
Accrued expenses | 609,607 | ||||||||||||||||||||||||||||||||||||||||
Common stock shares issuable upon conversion of debt/convertible securities | 1,000,000 | ||||||||||||||||||||||||||||||||||||||||
SkyPharm [Member] | Amendment to loan facility agreement [Member] | |||||||||||||||||||||||||||||||||||||||||
Debt outstanding amount | $ 240,251 | ||||||||||||||||||||||||||||||||||||||||
Short term debt borrowing capacity | $ 1,533,020 | ||||||||||||||||||||||||||||||||||||||||
SkyPharm [Member] | Decahedron [Member] | Trade Facility [Member] | |||||||||||||||||||||||||||||||||||||||||
Short term debt borrowing capacity | $ 363,250 | ||||||||||||||||||||||||||||||||||||||||
Description for the repayment | The total facility will be calculated as 95% of the agreed upon value of Decahedrons receivables | ||||||||||||||||||||||||||||||||||||||||
Term of credit facility | 12 months | ||||||||||||||||||||||||||||||||||||||||
Credit facility origination fee, percentage | 2.00% | ||||||||||||||||||||||||||||||||||||||||
Monthly credit fee, percentage | 1.00% | ||||||||||||||||||||||||||||||||||||||||
Securities Purchase Agreement [Member] | Cosmofarm [Member] | |||||||||||||||||||||||||||||||||||||||||
Debt outstanding amount | 2,750,992 | ||||||||||||||||||||||||||||||||||||||||
Promissory note issued | $ 227,912 | ||||||||||||||||||||||||||||||||||||||||
Maturity date | Dec. 19, 2019 | ||||||||||||||||||||||||||||||||||||||||
Loan Agreement [Member] | Panagiotis Drakopoulos [Member] | |||||||||||||||||||||||||||||||||||||||||
Debt outstanding amount | 9,784 | 14,595 | |||||||||||||||||||||||||||||||||||||||
Maturity date | Nov. 15, 2016 | ||||||||||||||||||||||||||||||||||||||||
Interest rate | 6.00% | ||||||||||||||||||||||||||||||||||||||||
Short term debt borrowing capacity | $ 42,832 | ||||||||||||||||||||||||||||||||||||||||
Accrued expenses | 5,852 | 4,677 | |||||||||||||||||||||||||||||||||||||||
Repayment of debt | 5,862 | ||||||||||||||||||||||||||||||||||||||||
Synthesis facility agreement [Member] | TFF [Member] | |||||||||||||||||||||||||||||||||||||||||
Debt outstanding amount | $ 5,629,555 | ||||||||||||||||||||||||||||||||||||||||
Accrued expenses | $ 524,094 | 402 | |||||||||||||||||||||||||||||||||||||||
Description for amendment to agreement under ASU 470-50 | The Company evaluated the amended agreement under ASC 470-50 and concluded that it did not meet the 10% cash flow test and recorded debt modification expense of $138,110. | ||||||||||||||||||||||||||||||||||||||||
Debt modification expense | $ 138,110 | ||||||||||||||||||||||||||||||||||||||||
Debt split, balance | 2,446,000 | ||||||||||||||||||||||||||||||||||||||||
Synthesis facility agreement [Member] | TFF [Member] | Principal balance 2 [Member] | |||||||||||||||||||||||||||||||||||||||||
Maturity date | Aug. 31, 2021 | ||||||||||||||||||||||||||||||||||||||||
Accrued expenses | 16,185 | 12,661 | |||||||||||||||||||||||||||||||||||||||
Notes payable long term | 2,384,850 | ||||||||||||||||||||||||||||||||||||||||
Debt split, balance | $ 4,000,000 | $ 4,000,000 | $ 4,000,000 | ||||||||||||||||||||||||||||||||||||||
Interest rate description | 6% per annum plus one-month Libor on the USD balance | ||||||||||||||||||||||||||||||||||||||||
Repayment of debt, periodic payments | $ 150,000 | ||||||||||||||||||||||||||||||||||||||||
Frequency of periodic payments | Quarterly | ||||||||||||||||||||||||||||||||||||||||
Debt Exchange Agreement [Member] | |||||||||||||||||||||||||||||||||||||||||
Debt outstanding amount | $ 611,500 | $ 2,000,000 | |||||||||||||||||||||||||||||||||||||||
Convertible notes payable, principal amount | 611,500 | 1,000,000 | |||||||||||||||||||||||||||||||||||||||
Accrued expenses | $ 8,514 | ||||||||||||||||||||||||||||||||||||||||
Notes payable long term | $ 543,557 | ||||||||||||||||||||||||||||||||||||||||
Agreement description | The note matures on November 18, 2025 and bears an annual interest rate, based on a 360-day year, of 3.3% plus .6% plus 6-month Euribor when Euribor is positive. Pursuant to the terms of the agreement, there is a six-month grievance from the first deposit date, which was November 19, 2020, for both interest accrual and principal repayment. The principal is to be repaid in 18 quarterly installments of €27,000 with the first payment due 9 months from the first deposit. | ||||||||||||||||||||||||||||||||||||||||
Shares issued | 259,741 | ||||||||||||||||||||||||||||||||||||||||
Share issued price per share | $ 3.85 | ||||||||||||||||||||||||||||||||||||||||
Gain on shares | $ 192,205 |
LEASES (Details)
LEASES (Details) - Operating Lease [Member] | Dec. 31, 2020USD ($) |
2021 | $ 248,288 |
2022 | 218,083 |
2023 | 192,583 |
2024 | 58,704 |
Thereafter | 220,107 |
Total undiscounted operating lease payments | 937,765 |
Less: Imputed interest | (147,023) |
Present value of operating lease liabilities | $ 790,742 |
LEASES (Details 1)
LEASES (Details 1) - Finance Lease [Member] | Dec. 31, 2020USD ($) |
2021 | $ 105,620 |
2022 | 76,252 |
2023 | 65,939 |
2024 | 49,688 |
2025 | 16,430 |
Thereafter | 0 |
Total undiscounted finance lease payments | 313,929 |
Less: Imputed interest | (35,831) |
Present value of finance lease liabilities | $ 278,098 |
LEASES (Details Narrative)
LEASES (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
LEASES | ||
Operating lease, term of agreements | The Company has various lease agreements with terms up to 10 years, comprising leases of office space | |
Operating lease expense | $ 188,400 | $ 223,927 |
Operating lease weighted-average remaining lease term | 7 years 3 months 18 days | |
Operating lease, weighted average discount rate | 6.74% | |
Finance lease, weighted average remaining lease term | 5 years 1 month 10 days | |
Finance lease, weighted average discount rate | 6.74% | |
Operating lease cash flows used in finance lease | $ 85,804 | 74,476 |
Finance lease, interest expense | 13,759 | 0 |
Finance lease, amortization expense | $ 123,533 | $ 160,542 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Narrative) - Private Placement [Member] | Sep. 04, 2018 | Aug. 08, 2017 | Nov. 16, 2017 |
Commitments and contingencies description | (1) a cash commission of 6% of the total gross proceeds for two named investors (2) a cash commission of 4% of total gross proceeds from five named investors and (3) excluding the five named investors in “(2)” a cash commission equal to 8% of the total gross proceeds from the Offering and the issuance to the Agent or its designees of warrants covering 8% of the shares of common stock issued or issuable by the Company in the Offering. | ||
Cash commission description | In connection with the Company’s September 4, 2018 Note offering, the Agent received a cash commission for this transaction of $140,000, equal to seven (7%) percent of the total gross proceeds of the offering and the issuance of five-year warrants to purchase seven (7%) percent of the shares of common stock issued or issuable in this offering (excluding shares of common stock issuable upon exercise of any warrants issued to investors, or 26,056 shares) | In connection with the Company’s November 16, 2017 Note offering, the Agent received a cash commission of $240,000, equal to eight (8%) percent of the total gross proceeds of the offering and the issuance of five-year warrants to purchase eight (8%) percent of the shares of common stock issued or issuable in the offering (excluding shares of common stock issuable upon exercise of any warrants issued to investors, or 53,600 shares) |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Numerator for Basic and Diluted Earnings Per Share: | ||
Net income (loss) | $ 820,786 | $ (3,298,965) |
Denominator for Basic Earnings Per Share: | ||
Weighted Average Shares | 13,270,097 | 13,273,596 |
Potentially Dilutive Common Shares | 37,698 | |
Adjusted Weighted Average Shares | 13,307,795 | 13,273,596 |
Basic and Diluted Net (Loss) Income per Share | $ 0.06 | $ (0.25) |
EARNINGS PER SHARE (Details 1)
EARNINGS PER SHARE (Details 1) - shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Excluded from computation of diluted net loss per share | 42,808 | |
Convertible Debt [Member] | ||
Excluded from computation of diluted net loss per share | ||
Options [Member] | ||
Excluded from computation of diluted net loss per share | 42,808 | |
Warrants [Member] | ||
Excluded from computation of diluted net loss per share |
STOCK OPTIONS AND WARRANTS (Det
STOCK OPTIONS AND WARRANTS (Details) - Stock Options [Member] - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Aggregate Intrinsic Value | ||
Number of Shares Outstanding, Beginning | 74,000 | 74,000 |
Granted | ||
Forfeited | (12,000) | |
Exercised | ||
Expired | ||
Number of Shares Outstanding, Ending | 62,000 | 74,000 |
Number of Shares Exercisable | 62,000 | |
Weighted Average Exercise Price Outstanding, Beginning | $ 1.32 | $ 1.32 |
Weighted Average Exercise Price Outstanding, Ending | 1.19 | $ 1.32 |
Weighted Average Exercise Price Exercisable | $ 1.19 | |
Weighted Average Remaining Contractual Term Outstanding, Beginning | 1 year 5 months 19 days | 2 years 5 months 19 days |
Weighted Average Remaining Contractual Term Outstanding, Ending | 7 months 6 days | 1 year 5 months 19 days |
Weighted Average Remaining Contractual Term Exercisable | 7 months 6 days | |
Aggregate Intrinsic Value Outstanding, Beginning | $ 64,800 | $ 198,000 |
Aggregate Intrinsic Value Outstanding, Ending | 242,000 | $ 64,800 |
Aggregate Intrinsic Value Exercisable | $ 242,000 |
STOCK OPTIONS AND WARRANTS (D_2
STOCK OPTIONS AND WARRANTS (Details 1) - Warrants [Member] - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Aggregate Intrinsic Value | ||
Number of Shares Outstanding, Beginning | $ 1,164,673 | $ 1,164,673 |
Granted | ||
Forfeited | ||
Expired | ||
Number of Shares Outstanding, Ending | $ 1,164,673 | $ 1,164,673 |
Number of Shares Exercisable | 1,164,673 | |
Weighted Average Exercise Price Outstanding, Beginning | $ 6.41 | $ 6.41 |
Weighted Average Exercise Price Outstanding, Ending | 6.41 | $ 6.41 |
Weighted Average Exercise Price Exercisable | $ 6.41 | |
Weighted Average Remaining Contractual Term Outstanding, Beginning | 4 years 4 days | 5 years 4 days |
Weighted Average Remaining Contractual Term Outstanding, Ending | 3 years 4 days | 4 years 4 days |
Weighted Average Remaining Contractual Term Exercisable | 3 years 4 days | |
Aggregate Intrinsic Value Outstanding, Ending Balance | $ 5,360 | |
Aggregate Intrinsic Value Exercisable | $ 5,360 |
STOCK OPTIONS AND WARRANTS (D_3
STOCK OPTIONS AND WARRANTS (Details Narrative) - Options [Member] | 12 Months Ended |
Dec. 31, 2020shares | |
Number of Shares Exercisable | 62,000 |
Number of Shares Outstanding, Beginning | 62,000 |
Expired dates description | Expiration dates commencing January 2021 and continuing through January 2022. |
DISAGGREGATION OF REVENUE (Deta
DISAGGREGATION OF REVENUE (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Revenue | $ 55,406,337 | $ 39,676,385 |
Greece [Member] | ||
Revenue | 51,259,784 | 26,101,316 |
Libya [Member] | ||
Revenue | 1,028 | 396,333 |
Cyprus [Member] | ||
Revenue | 36,987 | 0 |
Croatia [Member] | ||
Revenue | 24,840 | 22,497 |
Denmark [Member] | ||
Revenue | 537,098 | 97,905 |
France [Member] | ||
Revenue | 18,988 | 153,422 |
Georgia [Member] | ||
Revenue | 0 | 5,301 |
Germany [Member] | ||
Revenue | 1,314,381 | 6,672,511 |
Hungary [Member] | ||
Revenue | 0 | 1,094,446 |
Indonesia [Member] | ||
Revenue | 0 | 7,172 |
Ireland [Member] | ||
Revenue | 36,349 | 467,965 |
Italy [Member] | ||
Revenue | 75,183 | 196,044 |
Jordan [Member] | ||
Revenue | 29,635 | 20,144 |
Netherlands [Member] | ||
Revenue | 188,890 | 846,479 |
Poland [Member] | ||
Revenue | 29,358 | 307,624 |
Spain [Member] | ||
Revenue | 0 | 0 |
Turkey [Member] | ||
Revenue | 0 | 24,347 |
UK [Member] | ||
Revenue | $ 1,853,816 | $ 3,262,880 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - Subsequent Event [Member] - USD ($) | Feb. 05, 2021 | Jan. 07, 2021 |
Exchange Agreement [Member] | ||
Common stock exchange shares | 781,819 | |
Exchange price per share | $ 3.85 | |
Debt instrument converted amount | $ 3,010,000 | |
Consulting Agreement [Member] | Consultant [Member] | ||
Restricted stock shares issuable per month | 200,000 | |
Restricted stock shares | 1,800,000 | |
Agreement description | The Consultant retained 800,000 of the 1,800,000 shares and agreed with an assignee and the Company that 1,600,000 of the 1,800,000 shares shall be held in book entry for six (6) months from the date of this Agreement, subject to the above claw back. | |
Subscription Agreement [Member] | ||
Maturity date description | Matures on the earlier of (i) consummation of the Company listing its common shares on the NEO Stock Exchange or October 31, 2021. | |
Discount percentage upon sale of common stock share | 25.00% | |
Debt conversion description | The note holder will have the option, in part or in full, to have the note repaid with interest, or convert the note into Company common stock at a 25% discount to the 30-day volume-weighted average price of the Common Shares on the most senior stock exchange in North American on which the common shares are trading prior to conversion. | |
Debt instrument, principal amount | $ 100,000 | |
Interest rate | 8.00% | |
Stock Purchase Agreement [Member] | Unaffiliated Third Party [Member] | ||
Treasury stock shares sold | 65,000 | |
Net proceeds of common stock | $ 250,000 | |
Treasury stock, price per share | $ 3.85 |