Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2019 | Aug. 09, 2019 | |
Document And Entity Information | ||
Entity Registrant Name | MARIMED INC. | |
Entity Central Index Key | 0001522767 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2019 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Reporting Status Current | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 218,045,067 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2019 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 3,530,213 | $ 4,104,315 |
Accounts receivable, net | 8,662,045 | 5,376,966 |
Accounts receivable from related party, net | 25,177,845 | |
Due from third parties | 2,862,681 | 3,860,377 |
Deferred rents receivable | 2,047,914 | 2,096,384 |
Notes receivable, current portion | 821,524 | 51,462 |
Inventory | 4,783,596 | 90,460 |
Other current assets | 170,189 | 128,552 |
Total current assets | 48,056,007 | 15,708,516 |
Property and equipment, net | 37,603,881 | 34,099,864 |
Intangibles | 3,423,751 | 185,000 |
Investments | 35,662,106 | 1,672,163 |
Notes receivable, less current portion | 2,470,867 | 1,092,376 |
Debentures receivable | 30,000,000 | |
Right-of-use assets under operating leases | 6,042,970 | |
Right-of-use assets under finance leases | 70,989 | |
Due from related parties | 119,781 | |
Other assets | 345,905 | 82,924 |
Total assets | 133,676,476 | 82,960,624 |
Current liabilities: | ||
Accounts payable | 2,169,363 | 3,915,430 |
Accrued expenses | 3,920,742 | 1,588,368 |
Deferred rents payable | 105,901 | |
Notes payable | 20,844,176 | 3,877,701 |
Mortgages payable, current portion | 238,386 | 188,231 |
Operating lease liabilities, current portion | 647,379 | |
Finance lease liabilities, current portion | 23,112 | |
Due to related parties | 77,157 | 276,311 |
Unearned revenue from related party | 3,162,967 | |
Total current liabilities | 31,083,282 | 9,951,942 |
Mortgages payable, less current portion | 7,219,413 | 7,348,581 |
Debentures payable | 6,736,429 | 3,557,440 |
Operating lease liabilities, less current portion | 5,662,845 | |
Finance lease liabilities, less current portion | 48,874 | |
Other liabilities | 100,200 | 338,200 |
Total liabilities | 50,851,043 | 21,196,163 |
Stockholders' equity: | ||
Series A convertible preferred stock, $0.001 par value; 50,000,000 shares authorized at June 30, 2019 and December 31, 2018; no shares issued or outstanding at June 30, 2019 and December 31, 2018 | ||
Common stock, $0.001 par value; 500,000,000 shares authorized at June 30, 2019 and December 31, 2018; 215,591,103 and 211,013,043 shares issued and outstanding at June 30, 2019 and December 31, 2018, respectively | 215,591 | 211,013 |
Common stock subscribed but not issued; 752,260 and 97,136 shares at June 30, 2019 and December 31, 2018, respectively | 2,080,000 | 169,123 |
Additional paid-in capital | 100,621,830 | 87,180,165 |
Accumulated deficit | (20,921,933) | (25,575,808) |
Noncontrolling interests | 829,945 | (220,032) |
Total stockholders' equity | 82,825,433 | 61,764,461 |
Total liabilities and stockholders' equity | $ 133,676,476 | $ 82,960,624 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Jun. 30, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Series A convertible preferred stock, par value | $ 0.001 | $ 0.001 |
Series A convertible preferred stock, shares authorized | 50,000,000 | 50,000,000 |
Series A convertible preferred stock, shares issued | ||
Series A convertible preferred stock, shares outstanding | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 215,591,103 | 211,013,043 |
Common stock, shares outstanding | 215,591,103 | 211,013,043 |
Common stock, shares subscribed but unissued | 752,260 | 97,136 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Income Statement [Abstract] | ||||
Revenues | $ 3,657,798 | $ 2,937,325 | $ 7,173,614 | $ 5,020,275 |
Revenues from related party | 22,014,878 | 22,014,878 | ||
Total revenues | 25,672,676 | 2,937,325 | 29,188,492 | 5,020,275 |
Cost of revenues | 16,745,553 | 913,357 | 18,000,343 | 1,802,226 |
Gross profit | 8,927,123 | 2,023,968 | 11,188,149 | 3,218,049 |
Operating expenses: | ||||
Personnel | 825,130 | 284,886 | 1,498,504 | 469,557 |
Marketing and promotion | 76,060 | 77,943 | 194,959 | 129,704 |
General and administrative | 2,676,454 | 1,220,103 | 4,357,476 | 2,486,798 |
Total operating expenses | 3,577,644 | 1,582,932 | 6,050,939 | 3,086,059 |
Operating income (loss) | 5,349,479 | 441,036 | 5,137,210 | 131,990 |
Non-operating income (expenses): | ||||
Interest expense | (2,619,460) | (286,258) | (4,560,007) | (602,519) |
Interest income | 64,345 | 19,072 | 346,754 | 38,906 |
Loss on debt settlements | (563,119) | (1,776,960) | ||
Equity in earnings of investments | (45,465) | 1,912,942 | ||
Other | 2,948,917 | (3,600) | 2,948,917 | (3,600) |
Total non-operating income (expenses) | 348,337 | (833,905) | 648,606 | (2,344,173) |
Income (loss) before income taxes | 5,697,816 | (392,869) | 5,785,816 | (2,212,183) |
Provision for income taxes | 974,584 | (189) | 984,595 | 12,407 |
Net income (loss) | 4,723,232 | (392,680) | 4,801,221 | (2,224,590) |
Net income (loss) attributable to noncontrolling interests | 46,147 | 69,287 | 147,346 | 132,520 |
Net income (loss) attributable to MariMed Inc. | $ 4,677,085 | $ (461,967) | $ 4,653,875 | $ (2,357,110) |
Net income (loss) per share | ||||
Basic | $ 0.022 | $ (0.002) | $ 0.022 | $ (0.013) |
Diluted | $ 0.02 | $ (0.002) | $ 0.02 | $ (0.013) |
Weighted average common shares outstanding | ||||
Basic | 213,319,149 | 186,645,833 | 211,510,986 | 182,746,858 |
Diluted | 232,828,964 | 186,645,833 | 231,020,801 | 182,746,858 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) | Series A Convertible Preferred Stock Subscribed But Not Issued [Member] | Common Stock [Member] | Common Stock Subscribed But Not Issued [Member] | Additional Paid-In Capital [Member] | Accumulated Deficit [Member] | Non-Controlling Interests [Member] | Total |
Balance at Dec. 31, 2017 | $ 500 | $ 176,850 | $ 370,000 | $ 22,256,060 | $ (11,971,740) | $ 175,490 | $ 11,007,160 |
Balance, shares at Dec. 31, 2017 | 500,000 | 176,850,331 | 1,000,000 | ||||
Sales of common stock | $ 10,112 | 8,450,891 | 8,461,003 | ||||
Sales of common stock, shares | 10,111,578 | ||||||
Conversion of Series A preferred stock | $ (500) | $ 971 | 33,573 | 34,044 | |||
Conversion of Series A preferred stock, shares | (500,000) | 970,988 | |||||
Issuance of subscribed shares | $ 1,000 | $ (370,000) | 369,000 | ||||
Issuance of subscribed shares, shares | 1,000,000 | (1,000,000) | |||||
iRollie acquisition | $ 600,000 | 600,000 | |||||
iRollie acquisition, shares | 264,317 | ||||||
Settlement of obligations | $ 1,314 | $ 1,971,600 | 1,471,846 | 3,444,760 | |||
Settlement of obligations, shares | 1,313,901 | 2,010,922 | |||||
Exercise of options | $ 300 | 38,700 | 39,000 | ||||
Exercise of options, shares | 300,000 | ||||||
Exercise of warrants | $ 1,236 | $ 12,833 | 105,383 | 119,452 | |||
Exercise of warrants, shares | 1,235,768 | 32,083 | |||||
Amortization of option and warrant issuances | 6,863,609 | 6,863,609 | |||||
Retirement of promissory notes | $ 1,679 | 2,091,524 | 2,093,203 | ||||
Retirement of promissory notes, shares | 1,679,486 | ||||||
Distributions | (325,824) | (325,824) | |||||
Net income (loss) | (2,357,110) | 132,520 | (2,224,590) | ||||
Balance at Jun. 30, 2018 | $ 193,462 | $ 2,584,433 | 41,680,586 | (14,328,850) | (17,814) | 30,111,815 | |
Balance, shares at Jun. 30, 2018 | 193,462,052 | 2,307,322 | |||||
Balance at Dec. 31, 2017 | $ 500 | $ 176,850 | $ 370,000 | 22,256,060 | (11,971,740) | 175,490 | 11,007,160 |
Balance, shares at Dec. 31, 2017 | 500,000 | 176,850,331 | 1,000,000 | ||||
Balance at Dec. 31, 2018 | $ 211,013 | $ 169,123 | 87,180,165 | (25,575,808) | (220,032) | 61,764,461 | |
Balance, shares at Dec. 31, 2018 | 211,013,043 | 97,136 | |||||
Sales of common stock | $ 800 | 2,599,200 | 2,600,000 | ||||
Sales of common stock, shares | 799,995 | ||||||
Issuance of subscribed shares | $ 97 | $ (169,123) | 169,026 | ||||
Issuance of subscribed shares, shares | 97,136 | (97,136) | |||||
Exercise of options | $ 359 | 12,641 | 13,000 | ||||
Exercise of options, shares | 358,446 | ||||||
Exercise of warrants | $ 666 | 601,776 | 602,442 | ||||
Exercise of warrants, shares | 666,104 | ||||||
Amortization of option and warrant issuances | 2,458,941 | 2,458,941 | |||||
Distributions | (297,369) | (297,369) | |||||
MediTaurus acquisition | $ 2,080,000 | 1,200,000 | 3,280,000 | ||||
MediTaurus acquisition, shares | 752,260 | ||||||
Terrace investment | $ 500 | 1,589,500 | 1,590,000 | ||||
Terrace investment, shares | 500,000 | ||||||
Harvest payment | $ 1,000 | (1,000) | |||||
Harvest payment, shares | 1,000,000 | ||||||
Beneficial conversion feature on debentures | 3,384,980 | 3,384,980 | |||||
Conversion of debentures payable | $ 1,156 | 2,626,602 | 2,627,754 | ||||
Conversion of debentures payable, shares | 1,156,379 | ||||||
Net income (loss) | 4,653,875 | 147,346 | 4,801,221 | ||||
Balance at Jun. 30, 2019 | $ 215,591 | $ 2,080,000 | $ 100,621,831 | $ (20,921,933) | $ 829,945 | $ 82,825,433 | |
Balance, shares at Jun. 30, 2019 | 215,591,103 | 752,260 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Cash flows from operating activities: | |||||
Net income (loss) attributable to MariMed Inc. | $ 4,677,085 | $ (461,967) | $ 4,653,875 | $ (2,357,110) | |
Net income (loss) attributable to noncontrolling interests | 46,147 | 69,287 | 147,346 | 132,520 | |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||||
Depreciation | 171,125 | 253,713 | |||
Amortization of intangibles | 107,917 | ||||
Amortization of stock option and warrant issuances | 1,943,976 | 977,808 | |||
Amortization of beneficial conversion feature | 2,281,687 | ||||
Amortization of original issue discount | 28,920 | ||||
Equity issued to settle obligations | 3,444,760 | ||||
Loss on preferred stock conversions | 34,044 | ||||
Loss on debt settlements | (563,119) | (1,776,960) | |||
Equity in earnings of investments | 45,465 | (1,912,942) | |||
Changes in operating assets and liabilities: | |||||
Accounts receivable, net | (3,279,717) | (1,666,587) | |||
Accounts receivable from related party, net | (25,177,845) | ||||
Due from third parties | 141,783 | (1,177,734) | |||
Deferred rents receivable | 48,470 | (496,908) | |||
Inventory | (4,173,386) | ||||
Other current assets | (41,637) | (44,870) | |||
Other assets | (262,981) | 22,139 | |||
Accounts payable | (1,746,067) | 2,029 | |||
Accrued expenses | 1,652,508 | 246,810 | |||
Deferred rents payable | (105,901) | ||||
Operating lease payments | 267,253 | ||||
Finance lease interest payments | (1,824) | ||||
Unearned revenue from related party | 3,162,967 | ||||
Other liabilities | (238,000) | ||||
Net cash provided by (used in) operating activities | (22,332,472) | 188,818 | |||
Cash flows from investing activities: | |||||
Purchase of property and equipment | (3,668,398) | (5,663,585) | |||
MediTaurus acquisition | (171,003) | ||||
Investment in notes receivable | (1,550,000) | (100,000) | |||
Interest on notes receivable | 117,006 | 22,125 | |||
Due from related parties | 119,781 | ||||
Net cash used in investing activities | (5,152,614) | (5,741,460) | |||
Cash flows from financing activities: | |||||
Issuance of common stock | 2,600,000 | 8,461,003 | |||
Issuance of promissory notes | 17,000,000 | ||||
Payments on promissory notes | (700,000) | ||||
Proceeds from issuance of debentures | 7,275,000 | ||||
Proceeds from mortgages | 1,998,360 | ||||
Payments on mortgages | (79,012) | (56,452) | |||
Exercise of stock options | 13,000 | 39,000 | |||
Exercise of warrants | 602,442 | 119,451 | |||
Due to related parties | (199,154) | (196,000) | |||
Finance lease principal payments | (3,923) | ||||
Distributions | (297,369) | (325,825) | |||
Net cash provided by financing activities | 26,910,984 | 9,339,537 | |||
Net change to cash and cash equivalents | (574,102) | 3,786,895 | |||
Cash and cash equivalents at beginning of period | 4,104,315 | 1,290,231 | $ 1,290,231 | ||
Cash and cash equivalents at end of period | $ 3,530,213 | $ 5,077,126 | 3,530,213 | 5,077,126 | $ 4,104,315 |
Supplemental disclosure of cash flow information: | |||||
Cash paid for interest | 787,028 | 553,206 | |||
Cash paid for taxes | 10,011 | 12,596 | |||
Non-cash activities: | |||||
Conversion of debentures receivable | 30,000,000 | ||||
Operating lease right-of-use assets and liabilities | 6,981,772 | ||||
Finance lease right-of-use assets and liabilities | 77,773 | ||||
Conversions of debentures payable | 2,626,759 | ||||
Beneficial conversion feature on debentures payable | 3,384,980 | ||||
Discount on debentures payable | 928,724 | ||||
Discount on promissory notes | 600,621 | ||||
MediTaurus acquisition | 2,500,000 | ||||
Terrace investment | 1,590,000 | ||||
Harvest payment | 1,000 | ||||
Conversion of notes receivable to investment | 257,687 | ||||
Issuance of common stock associated with subscriptions | 169,123 | ||||
Conversion of advances to notes receivable | 855,913 | ||||
Equity issued to settle debt | $ 1,275,000 |
Organization and Description of
Organization and Description of Business | 6 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Organization and Description of Business | NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS MariMed Inc. (the “Company”), a Delaware corporation, is a multi-state organization in the emerging legal cannabis and hemp industries. During 2018, the Company made a strategic decision to transition from a management and advisory firm that provides cannabis licensing, operational consulting and real estate services, to a direct owner of cannabis licenses and operator of seed-to-sale operations. Further, in recognition of the growing demand for hemp-derived cannabidiol (“CBD”), the Company made a strategic investment in GenCanna Global Inc., one of the largest industrial hemp growers in the United States. To date, the Company’s cannabis business has secured, on behalf of itself and its clients, 12 cannabis licenses across six states—two in Delaware, two in Illinois, one in Nevada, one in Rhode Island, three in Maryland and three in Massachusetts. The Company has developed in excess of 300,000 square feet of state-of-the-art, regulatory-compliant facilities for the cultivation, production, and dispensing of legal cannabis and cannabis-infused products, located in all of the aforementioned states, except Rhode Island. Along with operational oversight of these facilities, the Company provides its clients with license procurement, business development, human resources, accounting, and other corporate and administrative services. The Company’s plan is to seek to acquire the ownership of all of its cannabis clients who currently lease the majority of the Company’s facilities, and ultimately consolidate these entities under the MariMed banner. The Company has started the consolidation process which is at various stages of completion. For example, in Massachusetts, the Company successfully converted its cannabis-licensed client from a non-profit entity to a for-profit corporation with the Company as the sole shareholder, as described in further detail below. In every state, the Company’s acquisition efforts will be subject to that particular state’s laws governing cannabis license ownership, and accordingly, there is no assurance that the Company will be successful in fully implementing its plan. Additionally, the Company licenses its own brands of precision-dosed, cannabis- and hemp-infused products to treat specific medical conditions or to achieve a certain effect. These products are licensed under the brand names Kalm Fusion™, Nature’s Heritage™, Betty’s Eddies™, and Florance™. The Company also has exclusive sublicensing rights in certain states to distribute Lucid Mood™ vaporizer pens, DabTabs™ vaporization tablets infused with cannabis concentrates, the Binske ® The Company’s stock is quoted on the OTCQB market under the ticker symbol MRMD. The Company was incorporated in January 2011 under the name Worlds Online Inc. Initially, the Company developed and managed online virtual worlds. By early 2014, this line of business effectively ceased operating, and the Company pivoted into the legal cannabis industry. Summary Transaction Timeline The following is a chronological summary of the major transactions undertaken by the Company. These transactions are disclosed in further detail in Note 3 Acquisitions, Note 4 Investments, Note 8 – Notes Receivable May 2014 – The Company, through its subsidiary MariMed Advisors Inc., acquired Sigal Consulting LLC, a company operating in the medical cannabis industry. This transaction was accounted for as a purchase acquisition where the Company was both the legal and accounting acquirer. October 2017 – The Company acquired the intellectual property, formulations, recipes, proprietary equipment, knowhow, and other certain assets of Betty’s Eddies™, a brand of cannabis-infused fruit chews. April 2018 – The Company acquired iRollie LLC, a manufacturer of branded cannabis products and accessories for consumers, and custom product and packaging for companies in the cannabis industry. August 2018 – The Company exchanged cash and stock to acquire a 23% ownership interest in an entity that developed Sprout, a customer relationship management and marketing platform for companies in the cannabis industry. August to October 2018 – The Company loaned $300,000 to Healer LLC, an entity that provides cannabis education, dosage programs, and products developed by Dr. Dustin Sulak, an integrative medicine physician and nationally renowned cannabis practitioner. In 2019, the Company loaned Healer an additional $500,000. October 2018 – The Company entered into a purchase agreement to acquire its two cannabis-licensed clients, KPG of Anna LLC and KPG of Harrisburg LLC, currently operating medical marijuana dispensaries in the state of Illinois. The Company has not yet received legislative approval – required for all ownership changes of cannabis licensees – and therefore these entities were not consolidated into the Company’s financial statements as of June 30, 2019. The Company anticipates approval will be obtained, and the transaction consummated, by the end of 2019. October 2018 – The Company’s cannabis-licensed client with cultivation and dispensary operations in Massachusetts, ARL Healthcare Inc. (“ARL”), filed a plan of entity conversion with the state to convert from a non-profit entity to a for-profit corporation, with the Company as the sole shareholder of the for-profit corporation. On November 30, 2018, the conversion plan was approved by the Massachusetts Secretary of State, and effective December 1, 2018, ARL was consolidated into the Company as a wholly-owned subsidiary. November 2018 – The Company issued a letter of intent to acquire The Harvest Foundation LLC, its cannabis-licensed client with cultivation operations in the state of Nevada. The parties entered into a purchase agreement governing the transaction in August 2019. The Company has not yet received state approval for the acquisition, and therefore this entity was not consolidated into the Company’s financial statements as of June 30, 2019. The Company anticipates approval will be obtained, and the transaction consummated, by the end of 2019. December 2018 – The Company entered into a memorandum of understanding to acquire Kind Therapeutics USA LLC, its cannabis-licensed client in the state of Maryland. The parties expect the merger agreement to be finalized, and the transaction approved by the state in the early part of 2020. January 2019 – The Company entered into an agreement with Maryland Health & Wellness Center Inc. (“MHWC”), an entity that has been pre-approved for a cannabis dispensing license, to provide MHWC with a construction loan in connection with the buildout of MHWC’s proposed dispensary. Upon the two-year anniversary of final state approval of MHWC’s dispensing license, the Company shall have the right, subject to state approval, to convert the promissory note underlying the construction loan into a 20% ownership interest of MHWC. January 2019 – The Company converted a note receivable from Chooze Corp., an entity that develops environmentally conscious CBD- and THC-infused products, into a 2.7% ownership interest in the entity. January 2019 – The Company established MariMed Hemp Inc., a wholly-owned subsidiary to develop, market, and distribute hemp-based CBD brands and products, and to provide hemp producers with bulk quantities of hemp genetics and biomass (“MariMed Hemp”). February 2019 – The Company converted its $30 million purchase of subordinated secured convertible debentures of GenCanna Global Inc., a producer and distributor of industrial hemp, CBD formulations, hemp genetics, and hemp products (“GenCanna”), into a 33.5% ownership interest in GenCanna. May 2019 – The Company extended loans totaling $750,000 to Atalo Holdings Inc., an agriculture and biotechnology firm specializing in research, development, and production of industrial hemp and hemp-based CBD products. May 2019 – The Company issued 500,000 shares of its common stock to purchase an 8.95% interest in Terrace Inc., a Canadian entity that develops and acquires international cannabis assets. June 2019 – the Company entered into a purchase agreement to acquire MediTaurus LLC, a company established by Dr. Jokubas Ziburkas, a PhD in neuroscience and a leading authority on hemp-based CBD and the endocannabinoid system. Meditaurus operates in the United States and Europe and has developed proprietary CBD formulations sold under its Florance™ brand. July 2019 – The Company entered into a licensing agreement for the exclusive manufacturing and distribution in seven eastern states of the Binske ® Significant Transactions in the Current Period During the quarter ended June 30, 2019, the Company entered into several hemp seed sale transactions with GenCanna whereby the Company acquired large quantities of top-grade feminized hemp seeds with proven genetics at volume discounts that it sold to GenCanna at market rates. The seeds met the U.S. government’s definition of federally legal industrial hemp, which was descheduled as a controlled substance and classified as an agricultural commodity upon the signing of the 2018 Farm Bill. The Company purchased approximately $3.3 million of hemp seed inventory in the quarter ended March 31, 2019, and an additional $16.7 million in the quarter ended June 30, 2019, which the Company sold and delivered to GenCanna for approximately $25.2 million. The seeds are to be harvested in the fall of 2019, and accordingly the Company provided GenCanna with extended payment terms, with full payments to be made by December 2019 after the crop is harvested. The payments by GenCanna are not contingent upon the harvest. As required by the relevant accounting guidance, the Company has classified the $25.2 million due from GenCanna as a receivable from a related party, with $22,0 million recognized as revenue from a related party for the six months ended June 30, 2019, and $3.2 million recorded under Unearned Revenue From Related Party Unearned Revenue From Related Party To fund the seed purchases, the Company borrowed $17.0M, which is included in Notes Payable Note 11 – Debt Towards the end of the second quarter of 2019, and in early third quarter of 2019, the Company purchased approximately $5.0 million of additional hemp seed inventory which it sold and delivered to GenCanna for approximately $8 million in the third quarter of 2019. The Company continues to explore opportunities to continue such seed sale transactions in the future. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). In accordance with GAAP, these interim statements do not contain all of the disclosures normally required in annual statements. In addition, the results of operations of interim periods are not necessarily indicative of the results of operations to be expected for the full year. Accordingly, these interim financial statements should be read in conjunction with the Company’s most recent audited annual financial statements and accompanying notes for the year ended December 31, 2018. Certain reclassifications have been made to prior periods’ data to conform to the current period presentation. These reclassifications had no effect on reported income (losses) or cash flows. Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of MariMed Inc. and the following majority-owned subsidiaries: Subsidiary: Percentage MariMed Advisors Inc. 100.0 % Mia Development LLC 89.5 % Mari Holdings IL LLC 60.0 % Mari Holdings MD LLC 97.4 % Mari Holdings NV LLC 100.0 % Hartwell Realty Holdings LLC 100.0 % iRollie LLC 100.0 % ARL Healthcare Inc. 100.0 % MariMed Hemp Inc. 100.0 % MediTaurus LLC 70.0 % Intercompany accounts and transactions have been eliminated. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts within the financial statements and disclosures thereof. Actual results could differ from these estimates or assumptions. Cash Equivalents The Company considers all highly liquid investments with a maturity date of three months or less to be cash equivalents. The fair values of these investments approximate their carrying values. The Company’s cash and cash equivalents are maintained with recognized financial institutions located in the United States. In the normal course of business, the Company may carry balances with certain financial institutions that exceed federally insured limits. The Company has not experienced losses on balances in excess of such limits and management believes the Company is not exposed to significant risks in that regard. Accounts Receivable Accounts receivable consist of trade receivables and are carried at their estimated collectible amounts. The Company provides credit to its clients in the form of payment terms. The Company limits its credit risk by performing credit evaluations of its clients and maintaining a reserve, if deemed necessary, for potential credit losses. Such evaluations include the review of a client’s outstanding balances with consideration towards such client’s historical collection experience, as well as prevailing economic and market conditions and other factors. Based on such evaluations, the Company recorded a reserve of $250,000 and $150,000 at June 30, 2019 and December 31, 2018, respectively. Inventory Inventory is carried at the lower of cost or net realizable value, with the cost being determined on a first-in, first-out (FIFO) basis. The Company periodically reviews physical inventory and will record a reserve for excess and/or obsolete inventory if necessary. As of the date of this report, no reserve was deemed necessary. Investments The Company classifies its investments as available-for-sale-investments. Investments are comprised of equity holding of private companies. These investments are recorded at fair value on the Company’s consolidated balance sheet, with changes to fair value, if any, included in comprehensive income. Investments are evaluated for other-than-temporary impairment and are written down if such impairments are deemed to have occurred. Revenue Recognition On January 1, 2018, the Company adopted the Financial Accounting Standards Board’s Accounting Standards Codification (“ASC”) 606, Revenue from Contract with Customers, ● Identify the contract(s) with a customer; ● Identify the performance obligations in the contract(s); ● Determine the transaction price; ● Allocate the transaction price to the performance obligations in the contract(s); and ● Recognize revenue as the performance obligation is satisfied. Additionally, when another party is involved in providing goods or services to the Company’s clients, a determination is made as to who—the Company or the other party—is acting in the capacity as the principal in the sale transaction, and who is merely the agent arranging for goods or services to be provided by the other party. The Company is typically considered the principal if it controls the specified good or service before such good or service is transferred to its client. The Company may also be deemed to be the principal even if it engages another party (an agent) to satisfy some of the performance obligations on its behalf, provided the Company (i) takes on certain responsibilities, obligations and risks, (ii) possesses certain abilities and discretion, or (iii) other relevant indicators of the sale. If deemed an agent, the Company would not recognize revenue for the performance obligations it does not satisfy. The adoption of this standard did not have a significant impact on the Company’s consolidated operating results, and accordingly no restatement has been made to prior period reported amounts. The Company’s main sources of revenue are comprised of the following: ● Real Estate – rental income and additional rental fees from leasing of the Company’s regulatory-compliant legal cannabis facilities to its clients, which are cannabis-licensed operating companies. Rental income is generally a fixed amount per month that escalates over the respective lease terms, while additional rental fees are based on a percentage of tenant revenues that exceed a specified amount. ● Management – fees for providing the Company’s cannabis clients with corporate services and operational oversight of their cannabis cultivation, production, and dispensary operations. These fees are based on a percentage of such clients’ revenue, and are recognized after services have been performed. ● Supply Procurement – the Company maintains volume discounts with top national vendors of cultivation and production resources, supplies, and equipment, which the Company acquires and resells to its clients or third parties within the cannabis industry. The Company recognizes this revenue after the acceptance of goods by the purchaser. ● Licensing – revenue from the sale of precision-dosed, cannabis-infused products, such as Kalm Fusion™ and Betty’s Eddies™, to legal dispensaries throughout the United States. The recognition of this revenue occurs when the products are delivered. ● Consulting – fees from third-parties parties where the Company provides assistance in securing cannabis licenses, and advisory services in the areas of facility design and development, and cultivation and dispensing best practices. These fees are recognized as the services are performed. ● Product Sales – direct sales of cannabis, hemp, and products derived from these plants. During the quarter ended June 30,2019, the Company commenced the direct sale of acquired hemp seed inventory. As the Company continues to explore opportunities to continue such sales, significant product sales are expected to be generated from (i) the distribution of the Company’s acquired and developing hemp-derived CBD product lines, and (ii) the dispensary and wholesale operations of ARL in Massachusetts and of the Company’s planned cannabis-licensee acquisitions in Illinois, Maryland, and Nevada. This revenue will be recognized when products are delivered or at retail points-of-sale. Research and Development Costs Research and development costs are charged to operations as incurred. Property and Equipment Property and equipment are stated at cost less accumulated depreciation, with depreciation recognized on a straight-line basis over the shorter of the estimated useful life of the asset or the lease term, if applicable. When assets are retired or disposed, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are included in income. Repairs and maintenance are charged to expense in the period incurred. The estimated useful lives of property and equipment are generally as follows: buildings and building improvements, seven to thirty-nine years; tenant improvements, the remaining duration of the related lease; furniture and fixtures, seven years; machinery and equipment, five to ten years. Land is not depreciated. The Company’s property and equipment are individually reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment exists when the carrying amount of an asset exceeds the aggregate projected future cash flows over the anticipated holding period on an undiscounted basis. An impairment loss is measured based on the excess of the asset’s carrying amount over its estimated fair value. Impairment analyses are based on management’s current plans, intended holding periods and available market information at the time the analyses are prepared. If these criteria change, the Company’s evaluation of impairment losses may be different and could have a material impact to the consolidated financial statements. For the six months ended June 30, 2019 and 2018, based on its impairment analyses, the Company did not have any impairment losses. Leases The consolidated financial statements reflect the Company’s adoption of ASC 842, Leases ASC 842 is intended to improve financial reporting of leasing transactions. The most prominent change from previous accounting guidance is the requirement to recognize right-of-use assets and lease liabilities for the rights and obligations created by operating leases in which the Company is the lessee that extend more than twelve months on the balance sheet. The Company elected the package of practical expedients permitted under ASC 842. Accordingly, the Company accounted for its existing operating leases that commenced before the effective date as operating leases under the new guidance without reassessing (i) whether the contracts contain a lease, (ii) the classification of the leases (iii) the accounting for indirect costs as defined in ASC 842. The Company determines if an arrangement is a lease at inception. Right-of-use assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Non-lease components within lease agreements are accounted for separately. Right-of-use assets and obligations are recognized at the commencement date based on the present value of lease payments over the lease term, utilizing the Company’s incremental borrowing rate. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Impairment of Long-Lived Assets The Company evaluates the recoverability of its fixed assets and other assets in accordance with ASC 360-10-15, Impairment or Disposal of Long-Lived Assets Fair Value of Financial Instruments The Company follows the provisions of ASC 820, Fair Value Measurement Financial Instruments, Level 1 Quoted market prices available in active markets for identical assets or liabilities as of the reporting date. Level 2 Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 3 Pricing inputs that are generally observable inputs and not corroborated by market data. The carrying amounts of the Company’s financial assets and liabilities, such as cash and accounts payable approximate their fair values due to the short maturity of these instruments. The fair value of option and warrant issuances are determined using the Black-Scholes pricing model and employing several inputs such as the expected life of instrument, the exercise price, the expected risk-free interest rate, the expected dividend yield, the value of the Company’s common stock on issuance date, and the expected volatility of such common stock. The following table summarizes the range of inputs used by the Company during the six months ended June 30, 2019 and 2018: Six Months Ended June 30, 2019 2018 Life of instrument 3.0 years 2.8 to 5.0 years Volatility factors 1.059 to 1.106 1.020 to 2.086 Risk-free interest rates 1.76% to 2.28% 1.92% to 2.94% Dividend yield 0% 0% The expected life of an instrument is calculated using the simplified method pursuant to Staff Accounting Bulletin Topic 14, Share-Based Payment The Company amortizes the fair value of option and warrant issuances on a straight-line basis over the requisite service period of each instrument. Extinguishment of Liabilities The Company accounts for extinguishment of liabilities in accordance with ASC 405-20, Extinguishments of Liabilities. Stock-Based Compensation The Company accounts for stock-based compensation using the fair value method as set forth in ASC 718, Compensation—Stock Compensation, Income Taxes The Company accounts for income taxes in accordance with ASC 740, Income Taxes ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. The Company did not take any uncertain tax positions and had no adjustments to unrecognized income tax liabilities or benefits for the six months ended June 30, 2019 and 2018. Related Party Transactions The Company follows ASC 850, Related Party Disclosures In accordance with ASC 850, the Company’s financial statements include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business, as well as transactions that are eliminated in the preparation of financial statements. Comprehensive Income The Company reports comprehensive income and its components following guidance set forth by ASC 220, Comprehensive Income Earnings Per Share Earnings per common share is computed pursuant to ASC 260, Earnings Per Share As of June 30, 2019 and 2018, there were 18,655,107 and 12,508,932, respectively, of potentially dilutive securities in the form of options and warrants. Also as of such dates, there were $350,000 and $250,000, respectively, of convertible promissory notes, and $13.75 million and zero, respectively, of convertible debentures payable, that were potentially dilutive, whose conversion into common stock is based on a discount to the market value of common stock on or about the future conversion date. Utilizing the June 30, 2019 closing stock price of the Company’s common stock, all such dilutive securities were convertible into 19,509,815 shares of common stock. Such share amount was included in the number of weighted average common shares outstanding on a diluted basis, and in the calculation of diluted net income per share for the three and six months ended June 30, 2019, as shown in the statement of operations. Commitments and Contingencies The Company follows ASC 450, Contingencies If the assessment of a contingency indicates that it is probable that a material loss will be incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. While not assured, management does not believe, based upon information available at this time, that a loss contingency will have material adverse effect on the Company’s financial position, results of operations or cash flows. Beneficial Conversion Features on Convertible Debt Convertible instruments that are not bifurcated as a derivative pursuant to ASC 815, Derivatives and Hedging A beneficial conversion feature is a nondetachable conversion feature that is “in-the-money” at the commitment date. The in-the-money portion, also known as the intrinsic value of the option, is recorded in equity, with an offsetting discount to the carrying amount of convertible debt to which it is attached. The discount is amortized to interest expense over the life of the debt with adjustments to amortization upon full or partial conversions of the debt. Risk and Uncertainties The Company is subject to risks common to companies operating within the legal and medical marijuana industries, including, but not limited to, federal laws, government regulations and jurisdictional laws. Noncontrolling Interests Noncontrolling interests represent third-party minority ownership of the Company’s consolidated subsidiaries. Net income attributable to noncontrolling interests is shown in the consolidated statements of operations; and the value of net assets owned by noncontrolling interests are presented as a component of equity within the balance sheets. Off Balance Sheet Arrangements The Company does not have any off-balance sheet arrangements. Recent Accounting Pronouncements In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash In June 2018, the FASB issued ASU 2018-07, Compensation - Stock Compensation (Topic 718): Improvement to Nonemployee Share-Based Payment Accounting, In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350) In addition to the above, the Company has reviewed all other recently issued, but not yet effective, accounting pronouncements, and does not believe the future adoption of any such pronouncements will have a material impact on its financial condition or the results of its operations. |
Acquisitions
Acquisitions | 6 Months Ended |
Jun. 30, 2019 | |
Business Combinations [Abstract] | |
Acquisitions | NOTE 3 – ACQUISITIONS Sigal Consulting LLC In May 2014, the Company, through its subsidiary MariMed Advisors Inc., acquired Sigal Consulting LLC from its ownership group which included the current CEO and CFO of the Company (the “Sigal Ownership Group”). The purchase price received by the Sigal Ownership Group was comprised of (i) 31,954,236 shares of common stock valued at approximately $5,913.000, representing 50% of the Company’s outstanding shares on the closing date, (ii) options to purchase three million shares of the Company’s common stock, expiring in September 2019 with exercise prices ranging from $0.15 to $0.35, and valued at approximately $570,000, and (iii) a 49% ownership interest in MariMed Advisors Inc. The excess of purchase price over the book value of the acquired entity was recorded as goodwill, which was subsequently impaired in full and written down to zero. In June 2017, the remaining 49% interest of MariMed Advisors Inc. was acquired by the Company in exchange for an aggregate 75 million shares of common stock issued to the Sigal Ownership Group. Betty’s Eddies™ In October 2017, the Company acquired the intellectual property, formulations, recipes, proprietary equipment, know-how, and other certain assets of the Betty’s Eddies™ brand of cannabis-infused fruit chews, from Icky Enterprises LLC, a company partially owned by an officer of the company (“Icky”). The purchase price was $140,000 plus 1,000,000 shares of the Company’s common stock valued at $370,000 based on the price of the common stock on the date of the agreement. The acquisition was accounted for in accordance with ASC 10, Business Combinations Inventory $ 46,544 Machinery and equipment 130,255 Goodwill 333,201 Total fair value of consideration $ 510,000 The goodwill balance of approximately $333,000 was written off in 2018. As part of the agreement between the parties, Icky is entitled to receive royalties based on a percentage of the Company’s sales of the Betty’s Eddies™ product line, commencing at 25% and decreasing to 2.5% as certain sales thresholds are met. For the six months ended June 30, 2019 and 2018, such royalties approximated $85,000 and $14,000, respectively. iRollie LLC Effective April 2018, the Company entered into a purchase agreement whereby 264,317 shares of the Company’s common stock were exchanged for 100% of the ownership interests of iRollie LLC, a manufacturer of branded cannabis products and accessories for consumers, and custom product and packaging for companies in the cannabis industry. The Company acquired, among other assets, iRollie’s entire product line, service offerings, client list, and intellectual property, and hired its two co-founders. The acquisition was accounted for in accordance with ASC 10. The shares of Company common stock, valued at approximately $280,000, were issued to iRollie’s former owners in December 2018, at which time the Company adjusted the total goodwill generated by the transaction. The following table summarizes the allocation of the purchase price to the fair value of the assets acquired: Cash and cash equivalents $ 13,494 Goodwill 266,682 Total fair value of consideration $ 280,176 Prior to the acquisition, iRollie had not been generating positive cash flow as a stand-alone entity, and in conformity with relevant accounting guidance, the goodwill was written off. ARL Healthcare Inc. In October 2018, the Company’s cannabis-licensed client in Massachusetts, ARL Healthcare Inc. (“ARL”), filed a plan of entity conversion with the state to convert from a non-profit entity to a for-profit corporation, with the Company as the sole shareholder of the for-profit corporation. ARL holds three cannabis licenses from the state of Massachusetts for the cultivation, production and dispensing of cannabis. On November 30, 2018, the conversion plan was approved by the Massachusetts Secretary of State, and effective December 1, 2018, ARL was consolidated into the Company as a wholly-owned subsidiary. The acquisition was accounted for in accordance with ASC 10, Business Combinations Equipment $ 21,000 Cannabis licenses 185,000 Accounts payable (120,689 ) Due to related parties (92,765 ) Total identifiable net assets (7,454 ) Goodwill 731,902 Total fair value of consideration $ 724,448 The total consideration paid by the Company was equal to the forgiveness of amounts owed to the Company by ARL. Accordingly, the transaction gave rise to goodwill of approximately $732,000, which the Company wrote off. The cannabis licenses acquired was included in the balance of Intangibles KPG of Anna LLC and KPG of Harrisburg LLC In October 2018, the Company entered into a purchase agreement to acquire 100% of the ownership interests of KPG of Anna LLC and KPG of Harrisburg LLC, the Company’s two cannabis-licensed clients that operate medical marijuana dispensaries in the state of Illinois (both entities collectively, the “KPGs”), from the current ownership group of the KPGs (the “Sellers”). As part of this transaction, the Company will also acquire the Sellers’ ownership interests of Mari Holdings IL LLC, the Company’s subsidiary which owns the real estate in which the KPGs’ dispensaries are located (“Mari-IL”). The purchase price of 1,000,000 shares of the Company’s common stock shall be issued to the Sellers upon the closing of the transaction, which is dependent upon, among other closing conditions, the approval by the Illinois Department of Financial and Professional Regulation. Such approval is expected to be received by the end of 2019. After the transaction is effectuated, the KPGs and Mari-IL will be wholly-owned subsidiaries of the Company. As of June 30, 2019, the Company had not yet received the state approval for the transaction, and therefore the operations of the KPGs were not consolidated into the Company’s financial statements at such date. The Company anticipates that approval will be obtained, and the transaction consummated, by the end of 2019. When that occurs, the Company will consolidate the acquired entities in accordance with ASC 10. The Harvest Foundation LLC In November 2018, the Company issued a letter of intent to acquire 100% of the ownership interests of The Harvest Foundation LLC, the Company’s cannabis-licensed client in the state of Nevada (“Harvest”). In August 2019, the parties entered into a purchase agreement governing the transaction. The acquisition is conditioned upon the appropriate legislative approval of the transaction, which is expected to occur by the end of 2019. Accordingly, the operations of Harvest have not been consolidated for the six months ended June 30, 2019. The purchase price is comprised of the issuance of (i) 1,000,000 shares of the Company’s common stock, in the aggregate, to two owners of Harvest, as a good faith deposit upon execution of the purchase agreement, (ii) $1.2 million of the Company’s common stock at closing, based on the closing price of the common stock on the day prior to state approval of the transaction, and (iii) warrants to purchase 400,000 shares of the Company’s common stock at an exercise price equal to the closing price of the Company’s common stock on the day prior to state approval of the transaction, In June 2019, the Company issued the aggregate 1,000,000 shares of common stock to the two owners of Harvest as a good faith deposit. These shares are restricted and will be returned to the Company in the event the transaction does not close by a certain date. As the transaction has not been consummated, the issued shares were recorded at par value within the Stockholders’ Equity Kind Therapeutics USA LLC In December 2018, the Company entered into a memorandum of understanding to merge with its cannabis-licensed client in Maryland, Kind Therapeutics USA LLC. A merger agreement is currently being drafted for this transaction, which is intended to qualify as a tax-deferred reorganization under the Internal Revenue Code. The parties expect the merger agreement to be finalized, and the transaction approved by the state legislature in 2020. MediTaurus LLC In May 2019, the Company entered into a purchase agreement to acquire Meditaurus LLC, a company established by Dr. Jokubas Ziburkas, a PhD in neuroscience and a leading authority on CBD and its interactions with the brain and endocannabinoid system. Meditaurus currently operates in the United States and Europe and has developed proprietary CBD formulations sold under its Florance™ brand. Pursuant to the purchase agreement, the Company acquired 70% of MediTaurus on June 1, 2019, and will acquire the remaining 30% of MediTaurus on June 1, 2020. The purchase price for the initial 70% was $2.8 million, comprised of cash payments totaling $720,000 and 752,260 shares of the Company’s common stock valued at $2,080,000. The purchase price of the remaining 30%, payable in cash or stock at the Company’s option, shall be equal to a defined percentage of the Company’s receipts from the licensing of certain MediTaurus technology and products that existing on June 1, 2019 (all such technology and products, the “MT Property”). For a period of ten years following June 1, 2020, certain former members of MediTaurus shall be paid a royalty on the Company’s receipts from the licensing of MT Property, with the royalty percentage commencing at 10% and decreasing to 2% over time. The acquisition was accounted for in accordance with ASC 10. The following table summarizes the allocation of the purchase price to the fair value of the assets acquired and liabilities assumed on the acquisition date: Cash and cash equivalents $ 128,997 Accounts receivable 5,362 Inventory 519,750 Tradename and customer lists 3,346,668 Accounts payable (777 ) Total value of MediTaurus 4,000,000 Noncontrolling interests in MediTaurus (1,200,000 ) Total fair value of consideration $ 2,800,000 The tradename and customer lists acquired were included the balance of Intangibles As part of the transaction, the Company hired Dr. Ziburkas as the Company’s Chief Innovation Officer, as well as other members of the MediTaurus executive team. AgriMed Industries of PA LLC In July 2018, the Company entered into a purchase agreement to acquire 100% of the ownership interests of AgriMed Industries of PA LLC (“AgriMed”), an entity that holds a license from the state of Pennsylvania for the cultivation of cannabis. The purchase price was comprised of $8 million, payable in stock and cash, and the assumption of certain liabilities of AgriMed. In February 2019, the Company commenced legal proceedings against AgriMed seeking specific performance of the purchase agreement. In May 2019, the dispute between the parties was resolved through the cash payment to the Company of $3.1 million and other good and valuable consideration, in exchange for the Company relinquishing its rights under the purchase agreement and releasing its claims against AgriMed. The net amount of approximately $2,949,000, representing the cash payment less legal fees and writeoffs of assets and supplies, was recorded in Other Non-Operating Income |
Investments
Investments | 6 Months Ended |
Jun. 30, 2019 | |
Schedule of Investments [Abstract] | |
Investments | NOTE 4 – INVESTMENTS At June 30, 2019 and December 31, 2018, the Company’s investments were comprised of the following: June 30, December 31, GenCanna Global Inc. $ 32,234,403 $ - Terrace Inc. 1,590,000 - CVP Worldwide LLC 1,080,016 1,172,163 Iconic Ventures Inc. 500,000 500,000 Chooze Corp. 257,687 - Total investments $ 35,662,106 $ 1,672,163 GenCanna Global Inc. During 2018, in a series of transactions, the Company purchased $30 million of subordinated secured convertible debentures (the “GC Debentures”) of GenCanna. In February 2019, the Company converted the GC Debentures, plus unpaid accrued interest of approximately $229,000 through the conversion date, into common stock of GenCanna equal to a 33.5% ownership interest in GenCanna on a fully diluted basis. The investment has been accounted for under the equity method. Accordingly, the Company recorded equity in earnings of approximately $2.0 million based on its percentage equity interest in GenCanna’s net income from the date of conversion through June 30, 2019. Among other provisions of the subscription agreement governing the GC Debentures, the Company agreed to fund a $10 million employee bonus pool should GenCanna meet certain 2019 operating targets, and the Company’s CEO was appointed to GenCanna’s board. Additionally, pursuant to a rights agreement, the Company was granted certain rights including the rights of inspection, financial information, and participation in future security offerings of GenCanna. Terrace Inc. In May 2019, the Company issued 500,000 shares of its common stock, valued at $1.59 million on the date of issuance, to purchase an 8.95% interest in Terrace Inc., a Canadian entity that develops and acquires international cannabis assets. The Company was not given a board seat, nor does it have the ability to exert operational or financial control over the entity. In accordance with ASC 321, Investments – Equity Securities The Company will continue to apply the alternative measurement guidance until this investment does not qualify to be so measured. The Company may subsequently elect to measure this investment at fair value, and if so, shall measure all identical or similar investments in Terrace at fair value. Any subsequent changes in fair value shall be recognized in net income. CVP Worldwide LLC In August 2018, the Company invested $300,000, of a total contracted cash investment of $500,000, and issued 378,259 shares of its common stock, valued at approximately $915,000, in exchange for a 23% ownership in CVP Worldwide LLC (“CVP”). CVP has developed a customer relationship management and marketing platform, branded under the name Sprout, which is specifically designed for companies in the cannabis industry. The Company shall assist in the ongoing development and design of Sprout, and in marketing Sprout to companies within the cannabis industry. The Company shall earn a percentage share of Sprout’s revenues generated from sales (i) to the Company’s clients, and (ii) by the Company to third parties. As of June 30, 2019, no revenue was earned by the Company. The investment has been accounted under the equity method. In 2018, the Company recorded a charge to net income of approximately $43,000 based on its equity in CVP’s net loss during the period of the Company’s ownership. Such amount reduced the carrying value of the investment to approximately $1,172,000 at December 31, 2018. For the six months ended June 30, 2019, the Company recorded a charge of approximately $92,000 representing the Company’s equity in CVP’s net loss during this period, further reducing the carrying value of the investment to approximately $1,080,000 at June 30, 2019. Iconic Ventures Inc. In December 2018, the Company purchased 2,500,000 shares of common stock of Iconic Ventures Inc. (“Iconic”) for an aggregate price of $500,000. Iconic has developed DabTabs™, a unique solution for cannabinoid vaporization via a convenient portable tablet that provides precisely measured dosing and acts as a storage system for full spectrum extracts, concentrates and distillates. The Company’s investment equates to a current ownership percentage in Iconic of approximately 10%. The Company was not given a board seat, nor does it have the ability to exert operational or financial control over the entity. In accordance with ASC 321, the Company elected the measurement alternative to value this equity investment without a readily determinable fair value. Following the Company’s purchase, there has been no impairment to this investment, nor any observable price changes to investments in Iconic. Accordingly, this investment was carried at $500,000 at June 30, 2019 and December 31, 2018. The Company will continue to apply the alternative measurement guidance until this investment does not qualify to be so measured. The Company may subsequently elect to measure this investment at fair value, and if so, shall measure all identical or similar investments in Iconic at fair value. Any subsequent changes in fair value shall be recognized in net income. Chooze Corp. In January 2019, the entire principal and accrued interest balance of a note receivable from Chooze Corp. of approximately $258,000 was converted into a 2.7% equity interest in Chooze. In accordance with ASC 321, the Company elected the measurement alternative to value this equity investment without a readily determinable fair value. Following the Company’s purchase, there has been no impairment to this investment, nor any observable price changes to investments in the entity. Accordingly, this investment was carried at approximately $258,000 at June 30, 2019. The Company will continue to apply the alternative measurement guidance until this investment does not qualify to be so measured. The Company may subsequently elect to measure this investment at fair value, and if so, shall measure all identical or similar investments in Chooze at fair value. Any subsequent changes in fair value shall be recognized in net income. Binske ® In July 2019, the Company entered into a licensing agreement for the exclusive manufacturing and distribution in seven eastern states of the Binske ® ® Vitiprints In August 2019, the Company terminated the license agreement it had entered into in August 2018 for the use of a patented technology to produce and distribute cannabis products with precise dosing and at increased economies (“Vitiprints”). The licensing agreement had an initial term of five years, and required the Company to make non-refundable payment of $250,000 which the Company charged to Cost of Revenues |
Deferred Rents Receivable
Deferred Rents Receivable | 6 Months Ended |
Jun. 30, 2019 | |
Revenue Recognition and Deferred Revenue [Abstract] | |
Deferred Rents Receivable | NOTE 5 – DEFERRED RENTS RECEIVABLE The Company is the lessor under several operating leases which contain rent holidays, escalating rents over time, options to renew, requirements to pay property taxes, insurance and/or maintenance costs, and contingent rental payments based on a percentage of monthly tenant revenues. The Company is not the lessor to any finance leases. The Company recognizes fixed rental receipts from such lease agreements on a straight-line basis over the expected lease term. Differences between amounts received and amounts recognized are recorded under Deferred Rents Receivable The Company leases the following owned properties: ● Delaware – a 45,000 square foot facility purchased in September 2016 and built into a cannabis cultivation, processing, and dispensary facility which is leased to a cannabis-licensed client occupying 100% of the space under a 20-year triple net lease expiring in 2035. ● Illinois – two 3,400 square foot free-standing retail dispensaries in the cities of Anna and Harrisburg and leased to two licensed cannabis dispensary clients each under a 20-year lease expiring in 2036. ● Maryland – a 180,000 square foot former manufacturing facility purchased January 2017 and rehabilitated by the Company into a cultivation and processing facility which is leased to a licensed cannabis client under a 20-year triple net lease that started in January 2018. ● Massachusetts – a 138,000 square foot industrial property of which approximately half of the available square footage is leased to a non-cannabis manufacturing company under a five-year lease. The Company subleases the following property: ● Delaware – 4,000 square feet of retail space in a multi-use building space which the Company developed into a cannabis dispensary which is subleased to its cannabis-licensed client under a under a five-year triple net lease with a five-year option to extend. As of June 30, 2019 and December 31, 2018, cumulative fixed rental receipts under such leases approximated $7.5 million and $5.4 million, respectively, compared to revenue recognized on a straight-line basis of approximately $9.5 million and $7.5 million. Accordingly, the deferred rents receivable balances at June 30, 2019 and December 31, 2018 approximated $2.0 million and $2.1 million, respectively. Future minimum rental receipts for non-cancelable leases and subleases as of June 30, 2019 were: 2019 $ 2,071,161 2020 4,222,040 2021 4,368,640 2022 4,293,999 2023 3,997,651 Thereafter 48,942,935 Total $ 67,896,427 |
Due from Third Parties
Due from Third Parties | 6 Months Ended |
Jun. 30, 2019 | |
Due From Third Parties | |
Due from Third Parties | NOTE 6 – DUE FROM THIRD PARTIES At June 30, 2019 and December 31, 2018, the following amounts were advanced by the Company to its cannabis-licensed clients primarily for working capital purposes: June 30, 2019 December 31, 2018 Kind Therapeutics USA Inc. (Maryland licensee) $ 1,590,016 $ 2,679,496 KPG of Anna LLC (Illinois licensee) 81,066 482,700 KPG of Harrisburg LLC (Illinois licensee) 46,516 449,385 Harvest Foundation LLC (Nevada licensee) 1,145,083 248,796 Total due from third parties $ 2,862,681 $ 3,860,377 When a client is able to organically fund its ongoing operations, such client will issue a promissory note to the Company for the cumulative advances made up to that point, which will then be paid down monthly over a period of time. The Company has successfully employed this strategy in the past, and accordingly, in January 2019, KPG of Anna LLC and KPG of Harrisburg LLC issued promissory notes to the Company as further described in Note 7 Notes Receivable |
Notes Receivable
Notes Receivable | 6 Months Ended |
Jun. 30, 2019 | |
Receivables [Abstract] | |
Notes Receivable | NOTE 7 – NOTES RECEIVABLE At June 30, 2019 and December 31, 2018, notes receivable were comprised of the following: June 30, December 31, First State Compassion Center $ 553,791 $ 578,723 Healer LLC 822,015 307,429 Atalo Holdings Inc. 755,113 - KPG of Anna LLC 447,712 - KPG of Harrisburg LLC 402,878 - Maryland Health & Wellness Center Inc. 310,882 - Chooze Corp. - 257,687 Total notes receivable 3,292,391 1,143,839 Notes receivable, current portion 821,524 51,462 Notes receivable, less current portion $ 2,470,867 $ 1,092,377 The Company loaned approximately $700,000 to First State Compassion Center, its Delaware cannabis-licensee client, during the period of October 2015 to April 2016. In May 2016, this client issued a 10-year promissory note, as amended, to the Company bearing interest at a compounded rate of 12.5% per annum. The monthly payments of approximately $10,100 will continue through April 2026, at which time the note will be fully paid down. At June 30, 2019 and December 31, 2018, the current portion of this note was approximately $55,000 and $51,000, respectively, and included in Note Receivable, Current Portion In May 2019, the Company loaned $750,000 to Atalo Holdings Inc., an agriculture and biotechnology firm specializing in research, development, and production of industrial hemp and hemp-based CBD products (“Atalo”). The loans bear interest at 6% per annum, with principal and interest payable on the earlier of April 3, 2020 or the date on which the Company acquires at least 25% of Atalo’s outstanding capital stock, in which case the principal and interest due shall be credited toward Company’s purchase price for such capital stock. In July 2019, the Company loaned an additional $230,000 to Atalo under the same terms as the initial loans. During the period August to October 2018, the Company loaned $300,000 to Healer LLC, an entity that provides cannabis education, dosage programs, and products developed by Dr. Dustin Sulak, an integrative medicine physician and nationally renowned cannabis practitioner. In 2019, the Company loaned Healer an additional $500,000. The loans bear interest at 6% per annum, with principal and interest payable on the maturity dates which are three years from the loan date. In January 2019, KPG of Anna LLC and KPG of Harrisburg LLC each issued a promissory note to the Company in the amount of approximately $451,000 and $405,000, respectively, representing the advances made by the Company to these entities through December 31, 2018. The notes bear interest at 12% per annum, with monthly principal and interest payments due through December 2038. At June 30, 2019, the current portion of these notes approximated $12,000 in the aggregate. In January 2019, the Company entered into an agreement with Maryland Health & Wellness Center Inc. (“MHWC”), an entity that has been pre-approved for a cannabis dispensing license, to provide MHWC with a construction loan in connection with the buildout of MHWC’s proposed dispensary. The Company also entered into a consulting services agreement to provide MHWC with advisory and oversight services over a three-year period relating to the development, administration, operation, and management of MHWC’s proposed dispensary in Maryland. The construction loan bears interest at 8% per annum, with principal and interest payable in January 2020, provided however, upon the two-year anniversary of final state approval of MHWC’s dispensing license, the Company shall have the right, subject to state approval, to convert the promissory note underlying the construction loan into a 20% ownership interest of MHWC. This conversion right of the Company shall be terminated if the consulting services agreement is terminated. During the period from May to October 2018, the Company loaned $250,000 to Chooze Corp. bearing interest at 8% per annum and maturing in 2021. In January 2019, the entire principal and accrued interest balance of approximately $258,000 was converted into a 2.7% ownership interest in Chooze. |
Inventory_Unearned Revenue From
Inventory/Unearned Revenue From Related Party | 6 Months Ended |
Jun. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Inventory/Unearned Revenue From Related Party | NOTE 8 – INVENTORY/UNEARNED REVENUE FROM RELATED PARTY During the six months ended June 30, 2019, MariMed Hemp purchased $20 million of hemp seeds for its wholesale hemp distribution business and to develop hemp-derived CBD products. The seeds meet the U.S. government’s definition of federally legal industrial hemp, which was descheduled as a controlled substance and classified as an agricultural commodity upon the signing of the 2018 Farm Bill. As previously disclosed in Note 1 – Organization and Description of Business As required by the relevant accounting guidance, the Company classified the $25.2 million of billings to GenCanna as a receivable from a related party, with $22,0 million recognized as revenue from a related party for the six months ended June 30, 2019, and $3.2 million recorded under Unearned Revenue From Related Party Unearned Revenue From Related Party At June 30, 2019, inventory was comprised of approximately $4.3 million of hemp seeds, and approximately $520,000 of hemp oil extract and products acquired in the MediTaurus transaction disclosed in Note 3 – Acquisitions |
Debentures Receivable
Debentures Receivable | 6 Months Ended |
Jun. 30, 2019 | |
Debentures Receivable | |
Debentures Receivable | NOTE 9 – DEBENTURES RECEIVABLE As detailed in Note 4 Investments |
Property and Equipment
Property and Equipment | 6 Months Ended |
Jun. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | NOTE 10 – PROPERTY AND EQUIPMENT At June 30, 2019 and December 31, 2018, property and equipment consisted of the following: June 30, 2019 December 31, 2018 Land $ 3,392,710 $ 3,392,710 Buildings and building improvements 14,513,538 13,566,144 Tenant improvements 5,625,882 5,348,882 Furniture and fixtures 143,237 114,160 Machinery and equipment 2,057,059 1,632,351 Construction in progress 14,473,474 12,205,447 40,205,900 36,259,694 Less: accumulated depreciation (2,602,019 ) (2,159,830 ) Property and equipment, net $ 37,603,881 $ 34,099,864 During the six months ended June 30, 2019 and 2018, additions to property and equipment were approximately $3.9 million and $5.7 million, respectively. The 2018 additions were primarily comprised of (i) the buildout of properties in Hagerstown, MD, New Bedford, MA, and Middleborough, MA, and (ii) improvements to the Lewes, DE facility. The 2019 additions consisted primarily of (i) the commencement of construction in Milford, DE, (ii) the continued buildout of properties in Hagerstown, MD, New Bedford, MA, and Middleborough, MA, and (iii) improvements to the Wilmington, DE and Las Vegas, NV properties. The December 31, 2018 construction in progress balance of approximately $12.2 million was primarily comprised of (i) New Bedford, MA building, improvements and machinery of approximately $9.8 million and (ii) Middleborough, MA building, improvements and fixtures of approximately $2.4 million. The additions to construction in progress during the six months ended June 30, 2019 of approximately $2.3 million consisted of continuing buildout and machinery for the New Bedford, MA and Middleborough, MA properties, and the commencement of construction in Milford, DE. Depreciation expense for the six months ended June 30, 2019 and 2018 was approximately $471,000 and $254,000, respectively. |
Debt
Debt | 6 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
Debt | NOTE 11 – DEBT Mortgages Payable At June 30, 2019 and December 31, 2018, mortgage balances, including accrued but unpaid interest, were comprised of the following: June 30, December 31, Bank of New England – Massachusetts property $ 4,877,624 $ 4,895,000 Bank of New England – Delaware property 1,742,619 1,791,736 DuQuoin State Bank – Illinois properties 837,556 850,076 Total mortgages payable 7,457,799 7,536,812 Mortgages payable, current portion (238,386 ) (188,231 ) Mortgages payable, less current portion $ 7,219,413 $ 7,348,581 In November 2017, the Company entered into a 10-year mortgage agreement with Bank of New England for the purchase of a 138,000 square foot industrial property in New Bedford, Massachusetts, within which the Company has built a 70,000 square foot cannabis cultivation and processing facility that is leased to ARL. This mortgage was personally guaranteed by the Company’s CEO and CFO. From the start of the mortgage through May 2019, the Company was required to make monthly payments of interest-only at a rate equal to the prime rate plus 2%, with a floor of 6.25% per annum. From May 2019 to May 2024, the Company shall make principal and interest payments at a rate equal to the prime rate on May 2, 2019 plus 2%, with a floor of 6.25% per annum. Principal and interest payments shall continue from May 2024 through the end of the lease at a rate equal to the prime rate on May 2, 2024 plus 2%, with a floor of 6.25% per annum. The outstanding principal balance on this mortgage was approximately $4,877,000 and $4,895,000 on June 30, 2019 and December 31, 2018, respectively, of which approximately $110,000 and $63,000, respectively, was current. The Company maintains a second mortgage with Bank of New England, also personally guaranteed by the Company’s CEO and CFO, for the 2016 purchase of a 45,070 square foot building in Wilmington, Delaware which was developed into a cannabis seed-to-sale facility and is currently leased to the Company’s cannabis-licensed client in the state. The mortgage matures in 2031 with monthly principal and interest payments at a rate of 5.25% per annum through September 2021, and thereafter the rate adjusting every five years to the then prime rate plus 1.5% with a floor of 5.25% per annum. At June 30, 2019 and December 31, 2018, the outstanding principal balance on this mortgage was approximately $1,743,000 and $1,792,000, respectively, of which approximately $105,000 and $102,000, respectively, was current. In 2016, the Company entered into a mortgage agreement with DuQuoin State Bank (“DSB”) for the purchase of two properties which the Company developed into two 3,400 square foot free-standing retail dispensaries that are currently leased to the KPGs. On May 5 th Notes Payable In June 2019, MariMed Hemp issued a $10 million secured promissory note to an unaffiliated party (the “$10M Note”). On the maturity date in January 2020, or earlier at MariMed Hemp’s discretion, the principal balance shall be repaid plus a payment of $1.5 million. At June 30, 2019, the pro-rata portion, based on the term of the note, of such payment approximated $162,000 and was charged to interest expense. The $10M Note is secured by the Company’s right, title, and interest in certain property relative to the seed sale transactions with GenCanna, previously disclosed in Note 1 – Organization and Description of Business. As part of the $10M Note transaction, the Company issued three-year warrants to purchase 375,000 shares of common stock at an exercise price of $4.50 per share to the holder of the $10M Note. The fair value of these warrants on the issuance date of approximately $601,000 was recorded as a discount to the $10M Note. Approximately $65,000 of the warrant discount was amortized to interest expense in June 2018. Accordingly, the carrying value of the $10M Note approximated $9.46 million at June 30, 2019. In April 2019, MariMed Hemp issued a $1 million secured promissory note to an unaffiliated party maturing in December 2019. The note is secured by the collateral assignment of certain receivables from GenCanna (the “Secured Receivables”) and certain obligations of GenCanna to MariMed Hemp arising from the seed sale transactions previously disclosed in Note 1 – Organization and Description of Business In March 2019, the Company raised $6 million from the issuance of a secured promissory note maturing in December 2019 and bearing interest at the rate of 13% per annum, with interest payable monthly. Such note is secured by the collateral assignment of certain receivables from and obligations of GenCanna to MariMed Hemp arising from the seed sale transactions previously disclosed in Note 1 – Organization and Description of Business In September 2018, the Company raised $3 million from the issuance of a secured promissory note bearing interest at the rate of 10% per annum, with interest payable monthly. The note is due and payable in September 2019, however the Company may elect to prepay the note in whole or part at any time after December 17, 2018 without premium or penalty. The Company issued three-year warrants, which were attached to this promissory note, to the lender’s designees to purchase 750,000 shares of the Company’s common stock at an exercise price of $1.80 per share. The Company recorded a discount on the note of approximately $1,511,000 from the allocation of note proceeds to the warrants based on the fair value of such warrants on the issuance date. Approximately $882,000 of the warrant discount was amortized to interest expense during 2018, and the remaining $629,000 was amortized during 2019. The carrying value of this note was $3 million at June 30, 2019 and approximately $2.37 million, net of remaining warrant discount of $629,000, at December 31, 2018. During 2018, holders of previously issued promissory notes with principal balances of $1,075,000 converted such promissory notes into 1,568,375 shares of common stock at conversion prices ranging from $0.65 to $0.90 per share. The conversions resulted in the recording of non-cash losses of approximately $829,000 in the aggregate, based on the market value of the common stock on the conversion dates. No conversions occurred during the six months ended June 30, 2019 During 2018, the Company issued 2,596,313 shares of its common stock and subscriptions on 79,136 shares of its common stock to retire promissory notes with principal balances of $7,495,000 and approximately $95,000 of accrued interest. The Company recorded non-cash losses of approximately $2.5 million based on the fair value of the common stock on the retirement dates. No retirements were made during the six months ended June 30, 2019. During 2018 the Company repaid $700,000 of promissory notes. No repayments of promissory notes occurred during the six months ended June 30, 2019. The aggregate scheduled maturities of the Company’s total debt outstanding, inclusive of the promissory notes and mortgages described within this Note 12 Debt Note 12 Debentures Payable 2019 $ 10,496,536 2020 16,495,007 2021 7,762,293 2022 280,348 2023 299,689 Thereafter 6,262,463 Total 41,596,336 Less discounts (6,557,932 ) $ 35,038,404 |
Debentures Payable
Debentures Payable | 6 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
Debentures Payable | NOTE 12 – DEBENTURES PAYABLE In October and November 2018, pursuant to a securities purchase agreement (the “SPA”), the Company sold an aggregate of $10,000,000 of convertible debentures bearing interest at the rate of 6% per annum that mature two years from issuance, with a 1% issue discount to an accredited investor, resulting in net proceeds to the Company of $9,900,000 (the “$10M Debentures”). The holder of the $10M Debentures (the “Holder”) has the right at any time to convert all or a portion of the $10M Debenture, along with accrued and unpaid interest, into the Company’s common stock at conversion prices equal to 80% of a calculated average, as determined in the $10M Debentures, of the daily volume-weighted price during the ten consecutive trading days preceding the date of conversion. Notwithstanding this conversion right, the Holder shall limit conversions in any given month to certain agreed-upon values based on the conversion price, and the Holder shall also be limited from beneficially owning more than 4.99% of the Company’s outstanding common stock (potentially further limiting the Holder’s conversion right). The Company shall have the right to redeem all or a portion of the $10M Debentures, along with accrued and unpaid interest, at a 10% premium, provided however that the Company first provide advance written notice to the Holder of its intention to make a redemption, with the Holder allowed to affect certain conversions of the $10M Debentures during such notice period. Upon a change in control transaction, as defined in the $10M Debentures, the Holder may require the Company to redeem all or a portion of the $10M Debentures at a price equal to 110% of the principal amount of the $10M Debentures plus all accrued and unpaid interest thereon. So long as the $10M Debentures are outstanding, in the event the Company enters into a Variable Rate Transaction (“VRT”), as defined in the SPA, the Holder may cause the Company to revise the terms of the $10M Debentures to match the terms of the convertible security of such VRT. As part of issuance of the $10M Debentures, the Company issued three-year warrants to the Holder to purchase 324,675 shares of its common stock at exercise prices of $3.50 and $5.50 per share (the “Initial Warrants”). The fair value of the Initial Warrants of approximately $1,057,000 was recorded as a discount to the carrying amount of the $10M Debentures. Pursuant to the terms of a registration rights agreement with the Holder, entered into concurrently with the SPA and the $10M Debentures, the Company agreed to provide the Holder with customary registration rights with respect to any potential shares issued pursuant to the terms of the SPA, the $10M Debentures, and the Warrants. Subsequent to the consummation of the SPA and related agreements, the Company and the Holder executed an addendum to the SPA whereby the Holder agreed to that it would not undertake a conversion of all or a portion of the $10M Debentures that would require the Company to issue more shares than the amount of available authorized shares at the time of conversion, which amount of authorized shares shall not be less than the current authorized number of 500 million shares of common stock. Such addendum eliminated the requirement to bifurcate and account for the conversion feature of the $10M Debentures as a derivative. Based on the conversion prices of the $10M Debentures in relation to the market value of the Company’s common stock, the $10M Debentures provided the Holder with a beneficial conversion feature, as the embedded conversion option was in-the-money on the commitment date. The intrinsic value of the beneficial conversion feature of approximately $5,570,000 was recorded as a discount to the carrying amount of the $10M Debentures, with an offset to additional paid-in-capital. In May 2019, the Company sold an additional $5,000,000 of convertible debentures bearing interest at the rate of 6% per annum that mature two years from issuance, with a 1% issue discount, resulting in net proceeds to the Company of $4,950,000, and (the “$5M Debentures”). In June 2019, the Company sold an additional $2,500,000 of convertible debentures that mature two years from issuance, with a 7% issue discount, resulting in net proceeds to the Company of $2,350,000 (the “$2.5M Debentures,” and together with the $5M Debentures, the “$7.5M Debentures”). The $7.5M Debentures were sold to the Holder of the $10M Debentures. The terms of the $7.5M Debentures are consistent with the terms of the $10M Debentures, except that (i) no interest shall accrue on the $2.5M Debentures, (ii) the issue discount on the $2.5M Debentures is 7%, compared to 1% on the $10M Debentures and $5M Debentures, and (iii) other small variations, most notably a cap on the conversion price. The SPA, registration rights agreement, and addendum to the SPA were all amended and restated to incorporate the $7.5M Debentures. As part of issuance of the $7.5M Debentures, the Company issued three-year warrants to the Holder to purchase 550,000 shares of common stock an exercise price of $5.00 per share (the “Additional Warrants”). The fair value of the Additional Warrants of approximately $929,000 was recorded as a discount to the carrying amount of the $7.5M Debentures. Based on the conversion prices of the $7.5M Debentures in relation to the market value of the Company’s common stock, the $7.5M Debentures provided the Holder with a beneficial conversion feature, as the embedded conversion option was in-the-money on the commitment date. The intrinsic value of the beneficial conversion feature of approximately $3,385,000 was recorded as a discount to the carrying amount of the $7.5M Debentures, with an offset to additional paid-in-capital. In November and December 2018, the Holder converted, in two separate transactions, an aggregate of $1,400,000 of principal and approximately $36,000 of accrued interest into 524,360 shares of common stock at conversion prices of $2.23 and $3.04 per share. In January 2019, the Holder converted, in three separate transactions, an aggregate of $600,000 of principal and approximately $97,000 of accrued interest into 233,194 shares of common stock at conversion prices ranging from $2.90 to $3.06 per share. In April and June 2019, the Holder converted, in four separate transactions, an aggregate of $1,750,000 of principal and approximately $181,000 of accrued interest into 923,185 shares of common stock at conversion prices ranging from $1.74 to $2.74 per share. During the six months ended June 30, 2019, amortization of the beneficial conversion features, after adjustment for the conversions, approximated $2,282,000; amortization of the discounts from the Initial Warrants and Additional Warrants (together, the “Total Warrants”) approximated $320,000; and the amortization of original issue discounts approximated $29,000. This amortization was charged to interest expense. Additionally, accrued interest expense for such period approximated $280,000. At June 30, 2019, the aggregate outstanding principal balance on the $10M Debentures and the $7.5M Debentures (together, the “$17.5M Debentures”) was $13,750,000. Also on such date, the unamortized balances of the beneficial conversion feature, the Total Warrants discount, and original issue discounts were approximately $5,152,000, $1,575,000, and $287,000, respectively. Accordingly, at June 30, 2019, the carrying value of the $17.5M Debentures was approximately $6,736,000. At December 31, 2018, the outstanding principal balance on the $10M Debentures was $8,600,000. Also on such date, the unamortized balances of the beneficial conversion feature, Initial Warrants discount, and original issue discounts were approximately $4,048,000, $966,000, and $91,000, respectively, and accrued and unpaid interest was approximately $62,000. Accordingly, at December 31, 2018, the carrying value of the $10M Debentures was approximately $3.6 million. |
Equity
Equity | 6 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
Equity | NOTE 13 – EQUITY Preferred Stock In January 2018, all 500,000 shares of subscribed Series A convertible preferred stock were converted into 970,988 shares of common stock at a conversion price of $0.55 per share. The Company recorded a non-cash loss on conversion of approximately $34,000 based on the market value of the common stock on the conversion date. The Series A convertible preferred stock accrues an annual dividend of 6% until conversion. The preferred stock is convertible, along with any accrued dividends, into common stock at a twenty-five percent discount to the selling price of the common stock in a qualified offering, as defined in the subscription agreement. In addition, the Company has the ability to force the conversion of preferred stock at such time the Company has a market capitalization in excess of $50 million for ten consecutive trading days. In such event, the conversion price shall be a 25% discount to the average closing price of the Company’s common stock over the ten trading days prior to the Company’s notice of its intent to convert. Common Stock During the six months ended June 30, 2019, the Company sold 799,995 shares of common stock at a price of $3.25 per share, resulting in total proceeds of $2.6 million. During the same period in 2018, the Company sold 10,111,578 shares of common stock, at prices ranging from $0.50 to $1.30 per share, resulting in total proceeds of approximately $8.5 million. During the six months ended June 30, 2019 and 2018, the Company issued 97,136 and 1,000,000 common shares, respectively, associated with previously issued subscriptions on common stock with a value of approximately $169,000 and $370,000, respectively. During the six months ended June 30, 2018, the Company issued 1,313,901 common shares in exchange for services rendered by third-parties or to otherwise settle outstanding obligations. Based on the market value of the common stock on the dates of issuance, the Company recorded non-cash losses on these settlements of approximately $959,000. Also during such period, the Company issued 1,679,486 common shares to retire $1,175,000 of promissory notes. Based on the market value of the stock on the retirement dates, the Company recorded non-cash losses of approximately $918,000. No common shares were issued during the same period in 2019 to settle obligations or retire promissory notes. As previously disclosed in Note 3 – Acquisitions As previously disclosed in Note 4 – Investments As previously disclosed in Note 12 Debentures Payable As further disclosed in Note 14 – Stock Options As further disclosed in Note 15 – Warrants Common Stock Issuance Obligations At June 30, 2019, the Company was obligated to issue 752,260 shares of common stock, valued at $2,080,000, as part of the purchase price for MediTaurus, as previously disclosed in Note 3 – Acquisitions At December 31, 2018, the Company was obligated to issue: (a) 79,136 shares of common stock, valued at approximately $95,000, related to the settlement of a previously issued promissory note with a principal balance of $50,000 and accrued interest of $1,454; and (b) 18,000 shares of common stock, valued at approximately $74,000, for the payment of rent for a leased property in Massachusetts for the months of September 2018 through January 2019. Such shares were subsequently issued in the first quarter of 2019. At June 30, 2018, the Company was obligated to issue: (a) 264,317 shares of common stock to in connection with the acquisition of iRollie LLC, as disclosed in Note 3 – Acquisitions |
Stock Options
Stock Options | 6 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
Stock Options | NOTE 14 – STOCK OPTIONS In January 2018, the Company granted options to purchase 1.45 million shares of common stock to the Company’s board members at exercise prices ranging from $0.14 to $0.77, vesting over a six-month period, and expiring between December 2020 and December 2022. The fair value of these options on grant date of approximately $458,000 was fully amortized by June 30, 2018. No stock options were granted to board members during the six months ended June 30, 2019. In May 2018, the Company granted five-year options to purchase 200,000 shares of common stock to an employee with an exercise price of $0.90 per share. As of June 30, 2018, the Company amortized approximately $28,000 of the total adjusted fair value of this grant of approximately $208,000. In December 2018, 150,000 of these options were forfeited prior to their vesting dates. Approximately $50,000 of the fair value had been amortized through the forfeiture date, and as a result, approximately $158,000 will not be amortized. No options were granted to employees during the six months ended June 30, 2019. During the six months ended June 30, 2019 and 2018, options to purchase 520,000 and 700,000 shares of common stock, respectively, were exercised at exercise prices ranging from $0.08 to $0.77 per share in 2019, and $0.08 to $0.63 per share in 2018. Of the options exercised in 2019, 350,000 were exercised on a cashless basis by two board members with the exercise prices paid via the surrender of 139,985 shares of common stock. Of the options exercised in 2018, 400,000 were exercised by a board member on a cashless basis with the exercise price paid via the surrender of 98,000 shares of common stock. During the six months ended June 30, 2018, options to purchase 300,000 were forfeited, of which 200,000 had been owned by two board members. There were no forfeitures in 2019 Stock options outstanding and exercisable as of June 30, 2019 were: Exercise Price Shares Under Option Remaining per Share Outstanding Exercisable Life in Years $ 0.080 100,000 100,000 0.47 $ 0.130 200,000 200,000 1.00 $ 0.140 100,000 100,000 0.50 $ 0.140 550,000 550,000 1.51 $ 0.150 1,000,000 1,000,000 0.25 $ 0.250 1,000,000 1,000,000 0.25 $ 0.330 50,000 50,000 1.69 $ 0.350 1,000,000 1,000,000 0.25 $ 0.450 190,000 190,000 2.26 $ 0.630 300,000 300,000 2.51 $ 0.770 200,000 200,000 3.51 $ 0.900 50,000 50,000 3.87 $ 0.950 50,000 10,000 3.51 $ 2.320 300,000 60,000 4.20 $ 2.450 2,000,000 2,000,000 3.48 $ 2.500 100,000 25,000 4.16 $ 2.650 200,000 100,000 4.24 $ 2.850 75,000 - 3.45 $ 2.850 100,000 - 4.45 $ 3.000 25,000 - 4.47 $ 3.725 200,000 - 4.45 7,790,000 6,935,000 |
Warrants
Warrants | 6 Months Ended |
Jun. 30, 2019 | |
Warrants | |
Warrants | NOTE 15 – WARRANTS During the six months ended June 30, 2019, in conjunction with the $7.5M Debentures previously disclosed in Note 12 – Debentures Payable Note 11 – Debt During the six months ended June 30, 2018, the Company issued warrants to purchase 4,239,000 shares of common stock at exercise prices ranging from $0.30 to $2.25 per share. Of these warrants, (i) 470,000 warrants were issued in exchange for services previously rendered to the Company, with expiration dates of three and five years from issuance, at a fair value of approximately $433,000 which was charged to compensation expense during the period, (ii) 237,500 warrants issued in conjunction with a promissory note, expiring in April 2021, at a fair value of approximately $198,200 which was charged to interest expense during the period, and (iii) 3,531,500 three-year warrants issued as part of the sale of common stock, at a fair value of at issuance of approximately $4.5 million that was charged to additional paid-in capital. During the six months ended June 30, 2019 and 2018, warrants to purchase 666,104 and 1,425,379 shares of common stock, respectively, were exercised at exercise prices ranging from $0.12 to $1.75 per share in 2019 and $0.10 to $0.50 per share in 2018. At June 30, 2019 and 2018, warrants to purchase 10,865,107 and 7,058,932 shares of common stock, respectively, were outstanding at exercise prices ranging from $0.15 to $5.50 per share in 2019 and $0.10 to $2.25 per share in 2018. |
Revenues
Revenues | 6 Months Ended |
Jun. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | NOTE 16 – REVENUES For the six months ended June 30, 2019 and 2018, the Company’s revenues were comprised of the following major categories: Six months ended June 30, 2019 2018 Real estate $ 3,442,024 $ 2,731,364 Management 1,194,791 754,038 Supply procurement 1,906,399 1,241,834 Licensing 568,127 281,557 Product sales 1,880 - Product sales from related party 22,014,879 - Other 60,392 11,482 Total revenues $ 29,188,492 $ 5,020,275 For the six months ended June 30, 2019, revenue from three clients represented 95% of total revenues. One of these clients was GenCanna, a related party, with whom the Company conducted the seed sale transactions previously disclosed in Note 1 – Organization and Description of Business Product Sales From Related Party For the six months ended June 30, 2018, revenue from two clients comprised 75% of total revenues. |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Jun. 30, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 17 – RELATED PARTY TRANSACTIONS During the quarter ended June 30, 2019, the Company entered into several hemp seed sale transactions with GenCanna, a related party, whereby the Company acquired large quantities of top-grade feminized hemp seeds with proven genetics at volume discounts that it sold to GenCanna at market rates. As previously disclosed in Note 1 – Organization and Description of Business Unearned Revenue From Related Party Unearned Revenue From Related Party As disclosed in Note 3 Acquisitions In October 2017, the Company acquired certain assets of the Betty’s Eddies™ brand of cannabis-infused products, as disclosed in Note 3 Acquisitions As disclosed in Note 11 – Debt In January 2018, the Company granted options to purchase 1.45 million shares of common stock to the Company’s board members at exercise prices ranging from $0.14 to $0.77 and expiring between December 2020 and December 2022. Also during this month, options to purchase 200,000 were forfeited by board members. During the six months ended June 30, 2019 and 2018, options to purchase 350,000 and 400,000 shares of common stock, respectively, were exercised by board members on a cashless basis with the exercise prices paid via the surrender of 139,985 shares of common stock in 2019 and 98,000 shares of common stock in 2018. All of the option transactions referred to in this paragraph have been previously disclosed in Note 14 – Stock Options The Company’s current corporate offices are leased from a company owned by a related party under a 10-year lease that commenced August 2018 and contains a five-year extension option. Previous to this lease, the Company’s former corporate offices were also leased from a company owned by a related party. For the six months ended June 30, 2019 and 2018, expenses incurred under these leases approximated $34,000 and $6,000, respectively. The outstanding Due To Related Parties The outstanding Due From Related Parties |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 18 – COMMITMENTS AND CONTINGENCIES Lease Commitments The Company is the lessee under five operating leases and three finance leases. These leases contain rent holidays and customary escalations of lease payments for the type of facilities being leased. The Company recognizes rent expense on a straight-line basis over the expected lease term, including cancelable option periods which the Company fully expects to exercise. Certain leases require the payment of property taxes, insurance and/or maintenance costs in addition to the rent payments. The details of the Company’s operating lease agreements are as follows: ● Delaware – 4,000 square feet of retail space in a multi-use building under a five-year lease that commenced in October 2016 and contains a five-year option to extend the term. The Company developed the space into a cannabis dispensary which is subleased to its cannabis-licensed client. ● Delaware – a 100,000 square foot warehouse leased in March 2019 that the Company intends to construct into a cultivation and processing facility to be subleased to the same Delaware client. The lease term is 10 years, with an option to extend the term for three additional five-year periods. ● Nevada – 10,000 square feet of an industrial building that the Company has built-out into a cannabis cultivation facility and plans to rent to its cannabis-licensed client under a sub-lease which will be coterminous with this lease expiring in 2024. ● Massachusetts – 10,000 square feet of office space which the Company utilizes as its corporate offices under a 10-year lease with a related party expiring in 2028 which contain a 5-year extension option. ● Maryland – a 2,700 square foot 2-unit apartment under a lease that expires in July 2020 with an option to renew for a two-year term. The Company leases machinery and office equipment under finance leases that expire in February 2022 through June 2024 with such terms being a major part of the economic useful life of the leased property. The components of lease expense for the six months ended June 30, 2019 were as follows: Operating lease cost $ 339,478 Finance lease cost: Amortization of right-of-use assets $ 6,744 Interest on lease liabilities 1,824 Total finance lease cost $ 8,568 The weighted average remaining lease term for operating leases is 9.7 years, and for the finance lease is 3.9 years. The weighted average discount rate used to determine the right-of-use assets and lease liabilities was 7.5% for all leases. Future minimum lease payments as of June 30, 2019 under all non-cancelable operating leases having an initial or remaining term of more than one year were: Operating Leases Finance Lease 2019 $ 230,744 $ 11,556 2020 917,444 23,112 2021 1,008,227 23,112 2022 949,535 11,823 2023 910,166 10,451 Thereafter 5,139,851 3,229 Total lease payments 9,155,967 $ 83,282 Less: imputed interest (2,845,742 ) (11,296 ) $ 6,310,224 $ 71,986 Terminated Employment Agreement An employment agreement with Thomas Kidrin, the former CEO of the Company, that provided Mr. Kidrin with salary, car allowances, stock options, life insurance, and other employee benefits, was terminated by the Company in 2017. The Company maintained an accrual of approximately $1,043,000 at June 30, 2019 and December 31, 2018 for any amounts that may be owed under this agreement, although the Company contends that such agreement is not valid. In July 2019, Mr. Kidrin, also a former director of the Company, filed a complaint in the Massachusetts Superior Court, alleging that the Company breached the employment agreement and failed to pay all wages owed to him, and requesting compensatory damages, attorney fees, costs, and interest. To date, Mr. Kidrin has not served the complaint upon the Company. The Company believes that the allegations are without merit and will vigorously defend this matter when Mr. Kidrin makes service upon it. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 19 – SUBSEQUENT EVENTS Seed Transactions In July 2019, the Company delivered and billed GenCanna an additional $8.0 million for hemp seeds that were purchased by the Company for approximately $5.0 million. The seeds are to be harvested in the fall of 2019, and accordingly, the Company provided GenCanna with extended payment terms, with the full payment to be made in December 2019 after the crop is harvested. The accounting treatment of these sales were consistent with that of the original seed sale transactions as previously disclosed in Note – 1 Organization and Description of Business Licensing Agreement In July 2019, as previously disclosed in Note 4 – Investments ® Debentures Payable In July 2019, the Holder of the $17.5M Debentures converted, in two separate transactions, an aggregate of $2,750,000 of principal and approximately $17,000 of accrued interest into 2,435,144 shares of common stock at conversion prices of $1.08 and $1.70 per share. Note Receivable In July 2019, the Company loaned an additional $230,000 to Atalo, pursuant a promissory note to the Company that bears interest at 6% per annum, with principal and interest payable on the earlier of April 3, 2020 or the date on which the Company acquires at least 25% of Atalo’s outstanding capital stock, in which case the principal and interest due shall be credited toward Company’s purchase price for such capital stock. Equity In July 2019, the Company issued three-year warrants to purchase 125,000 shares of common stock at an exercise price of $1.71 per share. Also during this month, the Company issued options to purchase 100,000 shares of common stock to an employee at an exercise price of $1.34 per share, expiring five years from issuance date. In July and August, the Company issued an aggregate of 18,820 shares of common stock to two employees. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). In accordance with GAAP, these interim statements do not contain all of the disclosures normally required in annual statements. In addition, the results of operations of interim periods are not necessarily indicative of the results of operations to be expected for the full year. Accordingly, these interim financial statements should be read in conjunction with the Company’s most recent audited annual financial statements and accompanying notes for the year ended December 31, 2018. Certain reclassifications have been made to prior periods’ data to conform to the current period presentation. These reclassifications had no effect on reported income (losses) or cash flows. |
Principles of Consolidation | Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of MariMed Inc. and the following majority-owned subsidiaries: Subsidiary: Percentage MariMed Advisors Inc. 100.0 % Mia Development LLC 89.5 % Mari Holdings IL LLC 60.0 % Mari Holdings MD LLC 97.4 % Mari Holdings NV LLC 100.0 % Hartwell Realty Holdings LLC 100.0 % iRollie LLC 100.0 % ARL Healthcare Inc. 100.0 % MariMed Hemp Inc. 100.0 % MediTaurus LLC 70.0 % Intercompany accounts and transactions have been eliminated. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts within the financial statements and disclosures thereof. Actual results could differ from these estimates or assumptions. |
Cash Equivalents | Cash Equivalents The Company considers all highly liquid investments with a maturity date of three months or less to be cash equivalents. The fair values of these investments approximate their carrying values. The Company’s cash and cash equivalents are maintained with recognized financial institutions located in the United States. In the normal course of business, the Company may carry balances with certain financial institutions that exceed federally insured limits. The Company has not experienced losses on balances in excess of such limits and management believes the Company is not exposed to significant risks in that regard. |
Accounts Receivable | Accounts Receivable Accounts receivable consist of trade receivables and are carried at their estimated collectible amounts. The Company provides credit to its clients in the form of payment terms. The Company limits its credit risk by performing credit evaluations of its clients and maintaining a reserve, if deemed necessary, for potential credit losses. Such evaluations include the review of a client’s outstanding balances with consideration towards such client’s historical collection experience, as well as prevailing economic and market conditions and other factors. Based on such evaluations, the Company recorded a reserve of $250,000 and $150,000 at June 30, 2019 and December 31, 2018, respectively. |
Inventory | Inventory Inventory is carried at the lower of cost or net realizable value, with the cost being determined on a first-in, first-out (FIFO) basis. The Company periodically reviews physical inventory and will record a reserve for excess and/or obsolete inventory if necessary. As of the date of this report, no reserve was deemed necessary. |
Investments | Investments The Company classifies its investments as available-for-sale-investments. Investments are comprised of equity holding of private companies. These investments are recorded at fair value on the Company’s consolidated balance sheet, with changes to fair value, if any, included in comprehensive income. Investments are evaluated for other-than-temporary impairment and are written down if such impairments are deemed to have occurred. |
Revenue Recognition | Revenue Recognition On January 1, 2018, the Company adopted the Financial Accounting Standards Board’s Accounting Standards Codification (“ASC”) 606, Revenue from Contract with Customers, ● Identify the contract(s) with a customer; ● Identify the performance obligations in the contract(s); ● Determine the transaction price; ● Allocate the transaction price to the performance obligations in the contract(s); and ● Recognize revenue as the performance obligation is satisfied. Additionally, when another party is involved in providing goods or services to the Company’s clients, a determination is made as to who—the Company or the other party—is acting in the capacity as the principal in the sale transaction, and who is merely the agent arranging for goods or services to be provided by the other party. The Company is typically considered the principal if it controls the specified good or service before such good or service is transferred to its client. The Company may also be deemed to be the principal even if it engages another party (an agent) to satisfy some of the performance obligations on its behalf, provided the Company (i) takes on certain responsibilities, obligations and risks, (ii) possesses certain abilities and discretion, or (iii) other relevant indicators of the sale. If deemed an agent, the Company would not recognize revenue for the performance obligations it does not satisfy. The adoption of this standard did not have a significant impact on the Company’s consolidated operating results, and accordingly no restatement has been made to prior period reported amounts. The Company’s main sources of revenue are comprised of the following: ● Real Estate – rental income and additional rental fees from leasing of the Company’s regulatory-compliant legal cannabis facilities to its clients, which are cannabis-licensed operating companies. Rental income is generally a fixed amount per month that escalates over the respective lease terms, while additional rental fees are based on a percentage of tenant revenues that exceed a specified amount. ● Management – fees for providing the Company’s cannabis clients with corporate services and operational oversight of their cannabis cultivation, production, and dispensary operations. These fees are based on a percentage of such clients’ revenue, and are recognized after services have been performed. ● Supply Procurement – the Company maintains volume discounts with top national vendors of cultivation and production resources, supplies, and equipment, which the Company acquires and resells to its clients or third parties within the cannabis industry. The Company recognizes this revenue after the acceptance of goods by the purchaser. ● Licensing – revenue from the sale of precision-dosed, cannabis-infused products, such as Kalm Fusion™ and Betty’s Eddies™, to legal dispensaries throughout the United States. The recognition of this revenue occurs when the products are delivered. ● Consulting – fees from third-parties parties where the Company provides assistance in securing cannabis licenses, and advisory services in the areas of facility design and development, and cultivation and dispensing best practices. These fees are recognized as the services are performed. ● Product Sales – direct sales of cannabis, hemp, and products derived from these plants. During the quarter ended June 30,2019, the Company commenced the direct sale of acquired hemp seed inventory. As the Company continues to explore opportunities to continue such sales, significant product sales are expected to be generated from (i) the distribution of the Company’s acquired and developing hemp-derived CBD product lines, and (ii) the dispensary and wholesale operations of ARL in Massachusetts and of the Company’s planned cannabis-licensee acquisitions in Illinois, Maryland, and Nevada. This revenue will be recognized when products are delivered or at retail points-of-sale. |
Research and Development Costs | Research and Development Costs Research and development costs are charged to operations as incurred. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost less accumulated depreciation, with depreciation recognized on a straight-line basis over the shorter of the estimated useful life of the asset or the lease term, if applicable. When assets are retired or disposed, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are included in income. Repairs and maintenance are charged to expense in the period incurred. The estimated useful lives of property and equipment are generally as follows: buildings and building improvements, seven to thirty-nine years; tenant improvements, the remaining duration of the related lease; furniture and fixtures, seven years; machinery and equipment, five to ten years. Land is not depreciated. The Company’s property and equipment are individually reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment exists when the carrying amount of an asset exceeds the aggregate projected future cash flows over the anticipated holding period on an undiscounted basis. An impairment loss is measured based on the excess of the asset’s carrying amount over its estimated fair value. Impairment analyses are based on management’s current plans, intended holding periods and available market information at the time the analyses are prepared. If these criteria change, the Company’s evaluation of impairment losses may be different and could have a material impact to the consolidated financial statements. For the six months ended June 30, 2019 and 2018, based on its impairment analyses, the Company did not have any impairment losses. |
Leases | Leases The consolidated financial statements reflect the Company’s adoption of ASC 842, Leases ASC 842 is intended to improve financial reporting of leasing transactions. The most prominent change from previous accounting guidance is the requirement to recognize right-of-use assets and lease liabilities for the rights and obligations created by operating leases in which the Company is the lessee that extend more than twelve months on the balance sheet. The Company elected the package of practical expedients permitted under ASC 842. Accordingly, the Company accounted for its existing operating leases that commenced before the effective date as operating leases under the new guidance without reassessing (i) whether the contracts contain a lease, (ii) the classification of the leases (iii) the accounting for indirect costs as defined in ASC 842. The Company determines if an arrangement is a lease at inception. Right-of-use assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Non-lease components within lease agreements are accounted for separately. Right-of-use assets and obligations are recognized at the commencement date based on the present value of lease payments over the lease term, utilizing the Company’s incremental borrowing rate. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company evaluates the recoverability of its fixed assets and other assets in accordance with ASC 360-10-15, Impairment or Disposal of Long-Lived Assets |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company follows the provisions of ASC 820, Fair Value Measurement Financial Instruments, Level 1 Quoted market prices available in active markets for identical assets or liabilities as of the reporting date. Level 2 Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 3 Pricing inputs that are generally observable inputs and not corroborated by market data. The carrying amounts of the Company’s financial assets and liabilities, such as cash and accounts payable approximate their fair values due to the short maturity of these instruments. The fair value of option and warrant issuances are determined using the Black-Scholes pricing model and employing several inputs such as the expected life of instrument, the exercise price, the expected risk-free interest rate, the expected dividend yield, the value of the Company’s common stock on issuance date, and the expected volatility of such common stock. The following table summarizes the range of inputs used by the Company during the six months ended June 30, 2019 and 2018: Six Months Ended June 30, 2019 2018 Life of instrument 3.0 years 2.8 to 5.0 years Volatility factors 1.059 to 1.106 1.020 to 2.086 Risk-free interest rates 1.76% to 2.28% 1.92% to 2.94% Dividend yield 0% 0% The expected life of an instrument is calculated using the simplified method pursuant to Staff Accounting Bulletin Topic 14, Share-Based Payment The Company amortizes the fair value of option and warrant issuances on a straight-line basis over the requisite service period of each instrument. |
Extinguishment of Liabilities | Extinguishment of Liabilities The Company accounts for extinguishment of liabilities in accordance with ASC 405-20, Extinguishments of Liabilities. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for stock-based compensation using the fair value method as set forth in ASC 718, Compensation—Stock Compensation, |
Income Taxes | Income Taxes The Company accounts for income taxes in accordance with ASC 740, Income Taxes ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. The Company did not take any uncertain tax positions and had no adjustments to unrecognized income tax liabilities or benefits for the six months ended June 30, 2019 and 2018. |
Related Party Transactions | Related Party Transactions The Company follows ASC 850, Related Party Disclosures In accordance with ASC 850, the Company’s financial statements include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business, as well as transactions that are eliminated in the preparation of financial statements. |
Comprehensive Income | Comprehensive Income The Company reports comprehensive income and its components following guidance set forth by ASC 220, Comprehensive Income |
Earnings Per Share | Earnings Per Share Earnings per common share is computed pursuant to ASC 260, Earnings Per Share As of June 30, 2019 and 2018, there were 18,655,107 and 12,508,932, respectively, of potentially dilutive securities in the form of options and warrants. Also as of such dates, there were $350,000 and $250,000, respectively, of convertible promissory notes, and $13.75 million and zero, respectively, of convertible debentures payable, that were potentially dilutive, whose conversion into common stock is based on a discount to the market value of common stock on or about the future conversion date. Utilizing the June 30, 2019 closing stock price of the Company’s common stock, all such dilutive securities were convertible into 19,509,815 shares of common stock. Such share amount was included in the number of weighted average common shares outstanding on a diluted basis, and in the calculation of diluted net income per share for the three and six months ended June 30, 2019, as shown in the statement of operations. |
Commitments and Contingencies | Commitments and Contingencies The Company follows ASC 450, Contingencies If the assessment of a contingency indicates that it is probable that a material loss will be incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. While not assured, management does not believe, based upon information available at this time, that a loss contingency will have material adverse effect on the Company’s financial position, results of operations or cash flows. |
Beneficial Conversion Features on Convertible Debt | Beneficial Conversion Features on Convertible Debt Convertible instruments that are not bifurcated as a derivative pursuant to ASC 815, Derivatives and Hedging A beneficial conversion feature is a nondetachable conversion feature that is “in-the-money” at the commitment date. The in-the-money portion, also known as the intrinsic value of the option, is recorded in equity, with an offsetting discount to the carrying amount of convertible debt to which it is attached. The discount is amortized to interest expense over the life of the debt with adjustments to amortization upon full or partial conversions of the debt. |
Risk and Uncertainties | Risk and Uncertainties The Company is subject to risks common to companies operating within the legal and medical marijuana industries, including, but not limited to, federal laws, government regulations and jurisdictional laws. |
Noncontrolling Interests | Noncontrolling Interests Noncontrolling interests represent third-party minority ownership of the Company’s consolidated subsidiaries. Net income attributable to noncontrolling interests is shown in the consolidated statements of operations; and the value of net assets owned by noncontrolling interests are presented as a component of equity within the balance sheets. |
Off Balance Sheet Arrangements | Off Balance Sheet Arrangements The Company does not have any off-balance sheet arrangements. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash In June 2018, the FASB issued ASU 2018-07, Compensation - Stock Compensation (Topic 718): Improvement to Nonemployee Share-Based Payment Accounting, In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350) In addition to the above, the Company has reviewed all other recently issued, but not yet effective, accounting pronouncements, and does not believe the future adoption of any such pronouncements will have a material impact on its financial condition or the results of its operations. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Schedule of Majority Owned Subsidiaries | The accompanying condensed consolidated financial statements include the accounts of MariMed Inc. and the following majority-owned subsidiaries: Subsidiary: Percentage MariMed Advisors Inc. 100.0 % Mia Development LLC 89.5 % Mari Holdings IL LLC 60.0 % Mari Holdings MD LLC 97.4 % Mari Holdings NV LLC 100.0 % Hartwell Realty Holdings LLC 100.0 % iRollie LLC 100.0 % ARL Healthcare Inc. 100.0 % MariMed Hemp Inc. 100.0 % MediTaurus LLC 70.0 % |
Schedule of Assumptions Used | The following table summarizes the range of inputs used by the Company during the six months ended June 30, 2019 and 2018: Six Months Ended June 30, 2019 2018 Life of instrument 3.0 years 2.8 to 5.0 years Volatility factors 1.059 to 1.106 1.020 to 2.086 Risk-free interest rates 1.76% to 2.28% 1.92% to 2.94% Dividend yield 0% 0% |
Acquisitions (Tables)
Acquisitions (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Betty's Eddies [Member] | |
Schedule of Fair Value of Assets Acquired on Acquisition | The following table summarizes the allocation of the purchase price to the fair value of the assets acquired on the acquisition date: Inventory $ 46,544 Machinery and equipment 130,255 Goodwill 333,201 Total fair value of consideration $ 510,000 |
iRollie LLC [Member] | |
Schedule of Fair Value of Assets Acquired on Acquisition | The following table summarizes the allocation of the purchase price to the fair value of the assets acquired: Cash and cash equivalents $ 13,494 Goodwill 266,682 Total fair value of consideration $ 280,176 |
ARL Healthcare Inc. [Member] | |
Schedule of Fair Value of Assets Acquired on Acquisition | The following table summarizes the allocation of the purchase price to the fair value of the assets acquired and liabilities assumed on the acquisition date: Equipment $ 21,000 Cannabis licenses 185,000 Accounts payable (120,689 ) Due to related parties (92,765 ) Total identifiable net assets (7,454 ) Goodwill 731,902 Total fair value of consideration $ 724,448 |
Meditaurus LLC [Member] | |
Schedule of Fair Value of Assets Acquired on Acquisition | The following table summarizes the allocation of the purchase price to the fair value of the assets acquired and liabilities assumed on the acquisition date: Cash and cash equivalents $ 128,997 Accounts receivable 5,362 Inventory 519,750 Tradename and customer lists 3,346,668 Accounts payable (777 ) Total value of MediTaurus 4,000,000 Noncontrolling interests in MediTaurus (1,200,000 ) Total fair value of consideration $ 2,800,000 |
Investments (Tables)
Investments (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Schedule of Investments [Abstract] | |
Schedule of Investments | At June 30, 2019 and December 31, 2018, the Company’s investments were comprised of the following: June 30, December 31, GenCanna Global Inc. $ 32,234,403 $ - Terrace Inc. 1,590,000 - CVP Worldwide LLC 1,080,016 1,172,163 Iconic Ventures Inc. 500,000 500,000 Chooze Corp. 257,687 - Total investments $ 35,662,106 $ 1,672,163 |
Deferred Rents Receivable (Tabl
Deferred Rents Receivable (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Revenue Recognition and Deferred Revenue [Abstract] | |
Schedule of Future Minimum Rental Receipts for Non-cancelable Leases and Subleases | Future minimum rental receipts for non-cancelable leases and subleases as of June 30, 2019 were: 2019 $ 2,071,161 2020 4,222,040 2021 4,368,640 2022 4,293,999 2023 3,997,651 Thereafter 48,942,935 Total $ 67,896,427 |
Due from Third Parties (Tables)
Due from Third Parties (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Due From Third Parties | |
Schedule of Due from Third Parties | At June 30, 2019 and December 31, 2018, the following amounts were advanced by the Company to its cannabis-licensed clients primarily for working capital purposes: June 30, 2019 December 31, 2018 Kind Therapeutics USA Inc. (Maryland licensee) $ 1,590,016 $ 2,679,496 KPG of Anna LLC (Illinois licensee) 81,066 482,700 KPG of Harrisburg LLC (Illinois licensee) 46,516 449,385 Harvest Foundation LLC (Nevada licensee) 1,145,083 248,796 Total due from third parties $ 2,862,681 $ 3,860,377 |
Notes Receivable (Tables)
Notes Receivable (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Receivables [Abstract] | |
Schedule of Notes Receivable | At June 30, 2019 and December 31, 2018, notes receivable were comprised of the following: June 30, December 31, First State Compassion Center $ 553,791 $ 578,723 Healer LLC 822,015 307,429 Atalo Holdings Inc. 755,113 - KPG of Anna LLC 447,712 - KPG of Harrisburg LLC 402,878 - Maryland Health & Wellness Center Inc. 310,882 - Chooze Corp. - 257,687 Total notes receivable 3,292,391 1,143,839 Notes receivable, current portion 821,524 51,462 Notes receivable, less current portion $ 2,470,867 $ 1,092,377 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | At June 30, 2019 and December 31, 2018, property and equipment consisted of the following: June 30, 2019 December 31, 2018 Land $ 3,392,710 $ 3,392,710 Buildings and building improvements 14,513,538 13,566,144 Tenant improvements 5,625,882 5,348,882 Furniture and fixtures 143,237 114,160 Machinery and equipment 2,057,059 1,632,351 Construction in progress 14,473,474 12,205,447 40,205,900 36,259,694 Less: accumulated depreciation (2,602,019 ) (2,159,830 ) Property and equipment, net $ 37,603,881 $ 34,099,864 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Mortgages Payable | At June 30, 2019 and December 31, 2018, mortgage balances, including accrued but unpaid interest, were comprised of the following: June 30, December 31, Bank of New England – Massachusetts property $ 4,877,624 $ 4,895,000 Bank of New England – Delaware property 1,742,619 1,791,736 DuQuoin State Bank – Illinois properties 837,556 850,076 Total mortgages payable 7,457,799 7,536,812 Mortgages payable, current portion (238,386 ) (188,231 ) Mortgages payable, less current portion $ 7,219,413 $ 7,348,581 |
Schedule of Aggregate Maturities of Debt Outstanding | The aggregate scheduled maturities of the Company’s total debt outstanding, inclusive of the promissory notes and mortgages described within this Note 12 Debt Note 12 Debentures Payable 2019 $ 10,496,536 2020 16,495,007 2021 7,762,293 2022 280,348 2023 299,689 Thereafter 6,262,463 Total 41,596,336 Less discounts (6,557,932 ) $ 35,038,404 |
Stock Options (Tables)
Stock Options (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
Schedule of Stock Options Outstanding and Exercisable | Stock options outstanding and exercisable as of June 30, 2019 were: Exercise Price Shares Under Option Remaining per Share Outstanding Exercisable Life in Years $ 0.080 100,000 100,000 0.47 $ 0.130 200,000 200,000 1.00 $ 0.140 100,000 100,000 0.50 $ 0.140 550,000 550,000 1.51 $ 0.150 1,000,000 1,000,000 0.25 $ 0.250 1,000,000 1,000,000 0.25 $ 0.330 50,000 50,000 1.69 $ 0.350 1,000,000 1,000,000 0.25 $ 0.450 190,000 190,000 2.26 $ 0.630 300,000 300,000 2.51 $ 0.770 200,000 200,000 3.51 $ 0.900 50,000 50,000 3.87 $ 0.950 50,000 10,000 3.51 $ 2.320 300,000 60,000 4.20 $ 2.450 2,000,000 2,000,000 3.48 $ 2.500 100,000 25,000 4.16 $ 2.650 200,000 100,000 4.24 $ 2.850 75,000 - 3.45 $ 2.850 100,000 - 4.45 $ 3.000 25,000 - 4.47 $ 3.725 200,000 - 4.45 7,790,000 6,935,000 |
Revenues (Tables)
Revenues (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Revenues Comprised of Major Categories | For the six months ended June 30, 2019 and 2018, the Company’s revenues were comprised of the following major categories: Six months ended June 30, 2019 2018 Real estate $ 3,442,024 $ 2,731,364 Management 1,194,791 754,038 Supply procurement 1,906,399 1,241,834 Licensing 568,127 281,557 Product sales 1,880 - Product sales from related party 22,014,879 - Other 60,392 11,482 Total revenues $ 29,188,492 $ 5,020,275 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Components of Lease Expense | The components of lease expense for the six months ended June 30, 2019 were as follows: Operating lease cost $ 339,478 Finance lease cost: Amortization of right-of-use assets $ 6,744 Interest on lease liabilities 1,824 Total finance lease cost $ 8,568 |
Schedule of Future Minimum Lease Payments Under All Non-cancelable Operating Leases | Future minimum lease payments as of June 30, 2019 under all non-cancelable operating leases having an initial or remaining term of more than one year were: Operating Leases Finance Lease 2019 $ 230,744 $ 11,556 2020 917,444 23,112 2021 1,008,227 23,112 2022 949,535 11,823 2023 910,166 10,451 Thereafter 5,139,851 3,229 Total lease payments 9,155,967 $ 83,282 Less: imputed interest (2,845,742 ) (11,296 ) $ 6,310,224 $ 71,986 |
Organization and Description _2
Organization and Description of Business (Details Narrative) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||||||||||||
Aug. 09, 2019USD ($) | Jul. 31, 2019USD ($) | May 31, 2019USD ($)shares | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($)ft² | Mar. 31, 2019USD ($)ft² | Oct. 31, 2018USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2019USD ($)ft²Integer | Oct. 31, 2018USD ($) | Jun. 30, 2018USD ($) | May 30, 2019USD ($) | Feb. 28, 2019USD ($) | Jan. 31, 2019 | Dec. 31, 2018USD ($) | Aug. 31, 2018 | Sep. 30, 2016ft² | |
Area of land | ft² | 300,000 | 300,000 | |||||||||||||||
Ownership percentage | 23.00% | ||||||||||||||||
Proceeds from notes receivable | $ 117,006 | $ 22,125 | |||||||||||||||
Payment for purchase of inventory | $ 16,700,000 | $ 3,300,000 | |||||||||||||||
Billed amount | 25,672,676 | $ 2,937,325 | 29,188,492 | 5,020,275 | |||||||||||||
Accounts receivable from related party | 25,177,845 | 25,177,845 | |||||||||||||||
Revenues from related party | 22,014,878 | 22,014,878 | |||||||||||||||
ScenarioPlanMember | |||||||||||||||||
Billed amount | $ 8,000,000 | ||||||||||||||||
Subsequent Event [Member] | |||||||||||||||||
Payment for purchase of inventory | $ 5,000,000 | ||||||||||||||||
Funding to Seed Purchases [Member] | |||||||||||||||||
Notes payable | 17,000,000 | 17,000,000 | |||||||||||||||
Terrace Inc. [Member] | |||||||||||||||||
Number of common stock issued during period | shares | 500,000 | ||||||||||||||||
Percentage for acquired interest rate | 8.95% | ||||||||||||||||
Chooze Corp. [Member] | |||||||||||||||||
Ownership percentage | 2.70% | ||||||||||||||||
Proceeds from notes receivable | $ 250,000 | ||||||||||||||||
Healer LLC [Member] | Dr. Dustin Sulak [Member] | |||||||||||||||||
Proceeds from notes receivable | $ 300,000 | 500,000 | |||||||||||||||
Maryland Health & Wellness Center Inc [Member] | |||||||||||||||||
Ownership percentage | 20.00% | ||||||||||||||||
GenCanna Global, Inc. [Member] | |||||||||||||||||
Ownership percentage | 33.50% | ||||||||||||||||
Subordinated secured convertible debentures | $ 30,000,000 | ||||||||||||||||
Atalo Holdings Inc [Member] | |||||||||||||||||
Loan to related party | $ 750,000 | $ 750,000 | |||||||||||||||
Percentage for acquired interest rate | 25.00% | ||||||||||||||||
Atalo Holdings Inc [Member] | Subsequent Event [Member] | |||||||||||||||||
Loan to related party | $ 230,000 | ||||||||||||||||
Gen Canna [Member] | |||||||||||||||||
Accounts receivable from related party | 25,200,000 | 25,200,000 | |||||||||||||||
Revenues from related party | 22,000,000 | ||||||||||||||||
Unearned revenue | $ 3,200,000 | $ 3,200,000 | |||||||||||||||
Profit percentage of ownership portion | 33.50% | ||||||||||||||||
Gen Canna [Member] | Subsequent Event [Member] | |||||||||||||||||
Payment for purchase of inventory | 5,000,000 | ||||||||||||||||
Billed amount | $ 8,000,000 | ||||||||||||||||
Gen Canna [Member] | Billed Revenues [Member] | |||||||||||||||||
Billed amount | $ 25,200,000 | ||||||||||||||||
Delaware [Member] | |||||||||||||||||
Area of land | ft² | 100,000 | 100,000 | 100,000 | 45,000 | |||||||||||||
Illinois [Member] | |||||||||||||||||
Area of land | ft² | 3,400 | 3,400 | |||||||||||||||
Nevada [Member] | |||||||||||||||||
Area of land | ft² | 10,000 | 10,000 | |||||||||||||||
Maryland [Member] | |||||||||||||||||
Area of land | ft² | 180,000 | 180,000 | |||||||||||||||
Cannabis [Member] | |||||||||||||||||
Number of licenses | Integer | 12 | ||||||||||||||||
Number of states licensed | Integer | 5 | ||||||||||||||||
Cannabis [Member] | Delaware [Member] | |||||||||||||||||
Number of licenses | Integer | 2 | ||||||||||||||||
Cannabis [Member] | Illinois [Member] | |||||||||||||||||
Number of licenses | Integer | 2 | ||||||||||||||||
Cannabis [Member] | Nevada [Member] | |||||||||||||||||
Number of licenses | Integer | 1 | ||||||||||||||||
Cannabis [Member] | Rhode Island [Member] | |||||||||||||||||
Number of licenses | Integer | 1 | ||||||||||||||||
Cannabis [Member] | Maryland [Member] | |||||||||||||||||
Number of licenses | Integer | 3 | ||||||||||||||||
Cannabis [Member] | Massachusetts [Member] | |||||||||||||||||
Number of licenses | Integer | 3 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Impairment losses | |||
Options issued | |||
Warrants issued | |||
Unrecognized tax liabilities or benefits | |||
Common Stock [Member] | |||
Potentially dilutive securities, shares | 19,509,815 | ||
Convertible Promissory Notes [Member] | |||
Potentially dilutive securities, amount | $ 350,000 | 250,000 | |
Convertible Debentures Payable [Member] | |||
Potentially dilutive securities, amount | $ 13,750,000 | $ 0 | |
Options and Warrants [Member] | |||
Potentially dilutive securities, shares | 18,655,107 | 12,508,932 | |
Buildings and Building Improvements [Member] | Minimum [Member] | |||
Estimated useful lives of property and equipment | 7 years | ||
Buildings and Building Improvements [Member] | Maximum [Member] | |||
Estimated useful lives of property and equipment | 39 years | ||
Tenant Improvements [Member] | |||
Estimated useful lives of property and equipment | The remaining duration of the related lease. | ||
Furniture and Fixtures [Member] | |||
Estimated useful lives of property and equipment | 7 years | ||
Machinery and Equipment [Member] | Minimum [Member] | |||
Estimated useful lives of property and equipment | 5 years | ||
Machinery and Equipment [Member] | Maximum [Member] | |||
Estimated useful lives of property and equipment | 10 years | ||
Accounts Receivable [Member] | |||
Debt collectible reserve | $ 250,000 | $ 150,000 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Majority Owned Subsidiaries (Details) | Jun. 30, 2019 | Aug. 31, 2018 |
Percentage Owned | 23.00% | |
MariMed Advisors Inc. [Member] | ||
Percentage Owned | 100.00% | |
Mia Development LLC [Member] | ||
Percentage Owned | 89.50% | |
Mari Holdings IL LLC [Member] | ||
Percentage Owned | 60.00% | |
Mari Holdings MD LLC [Member] | ||
Percentage Owned | 97.40% | |
Mari Holdings NV LLC [Member] | ||
Percentage Owned | 100.00% | |
Hartwell Realty Holdings LLC [Member] | ||
Percentage Owned | 100.00% | |
iRollie LLC [Member] | ||
Percentage Owned | 100.00% | |
ARL Healthcare Inc. [Member] | ||
Percentage Owned | 100.00% | |
MariMed Hemp Inc. [Member] | ||
Percentage Owned | 100.00% | |
Meditaurus LLC [Member] | ||
Percentage Owned | 70.00% |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Schedule of Assumptions Used (Details) | 6 Months Ended | |
Jun. 30, 2019$ / shares | Jun. 30, 2018$ / shares | |
Life of Instrument [Member] | ||
Fair value assumptions, measurement input, term | 3 years | |
Life of Instrument [Member] | Minimum [Member] | ||
Fair value assumptions, measurement input, term | 2 years 9 months 18 days | |
Life of Instrument [Member] | Maximum [Member] | ||
Fair value assumptions, measurement input, term | 5 years | |
Volatility Factors [Member] | Minimum [Member] | ||
Fair value assumptions, measurement input, volatility factors | $ 1.059 | $ 1.020 |
Volatility Factors [Member] | Maximum [Member] | ||
Fair value assumptions, measurement input, volatility factors | 1.106 | 2.086 |
Risk-Free Interest Rate [Member] | Minimum [Member] | ||
Fair value assumptions, measurement input, volatility factors | 1.76 | 1.92 |
Risk-Free Interest Rate [Member] | Maximum [Member] | ||
Fair value assumptions, measurement input, volatility factors | $ 2.28 | $ 2.94 |
Dividend Yield [Member] | ||
Fair value assumptions, measurement input, percentages | 0 | 0 |
Acquisitions (Details Narrative
Acquisitions (Details Narrative) - USD ($) | Nov. 30, 2018 | Nov. 30, 2019 | Jun. 30, 2019 | May 31, 2019 | Dec. 31, 2018 | Oct. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2018 | Oct. 31, 2017 | Jun. 30, 2017 | May 31, 2014 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | Jun. 01, 2019 | Aug. 31, 2018 |
Ownership percentage | 23.00% | |||||||||||||||
Warrants to purchase shares of common stock | 4,239,000 | |||||||||||||||
MariMed Advisors Inc. [Member] | ||||||||||||||||
Percentage on minority ownership interest | 49.00% | |||||||||||||||
Options [Member] | ||||||||||||||||
Options to purchase shares of common stock | 358,446 | 300,000 | ||||||||||||||
Sigal Consulting LLC [Member] | ||||||||||||||||
Stock issued during period, shares, acquisitions | 31,954,236 | |||||||||||||||
Stock issued during period, value, acquisitions | $ 5,913,000 | |||||||||||||||
Percentage on outstanding shares | 50.00% | |||||||||||||||
Sigal Consulting LLC [Member] | MariMed Advisors Inc. [Member] | ||||||||||||||||
Percentage on minority ownership interest | 49.00% | |||||||||||||||
Number of common stock exchanged | 75,000,000 | |||||||||||||||
Sigal Consulting LLC [Member] | Options [Member] | ||||||||||||||||
Options to purchase shares of common stock | 3,000,000 | |||||||||||||||
Options exercisable term | 5 years | |||||||||||||||
Options expiry date | Sep. 30, 2019 | |||||||||||||||
Options to purchase shares of common stock, value | $ 570,000 | |||||||||||||||
Written down of goodwill | $ 0 | |||||||||||||||
Sigal Consulting LLC [Member] | Options [Member] | Minimum [Member] | ||||||||||||||||
Exercise price of options | $ 0.15 | |||||||||||||||
Sigal Consulting LLC [Member] | Options [Member] | Maximum [Member] | ||||||||||||||||
Exercise price of options | $ 0.35 | |||||||||||||||
Betty's Eddies [Member] | ||||||||||||||||
Options to purchase shares of common stock, value | $ 370,000 | |||||||||||||||
Stock issued during period, value, purchase of assets | $ 140,000 | |||||||||||||||
Stock issued during period, shares, purchase of assets | 1,000,000 | |||||||||||||||
Written down of goodwill | $ 333,000 | |||||||||||||||
Description on royalties percentage | Icky shall receive royalties based on a percentage of the Company's sales of the Betty's Eddies™ product line, commencing at 25% and decreasing to 2.5% as certain sales thresholds are met. | |||||||||||||||
Royalties | $ 85,000 | $ 14,000 | ||||||||||||||
iRollie LLC [Member] | ||||||||||||||||
Value of common stock issued to former owners | $ 280,000 | |||||||||||||||
iRollie LLC [Member] | Purchase Agreement [Member] | ||||||||||||||||
Number of shares subscriptions on common stock equity interest | 264,317 | |||||||||||||||
Ownership percentage | 100.00% | |||||||||||||||
ARL Healthcare Inc. [Member] | ||||||||||||||||
Written down of goodwill | $ 732,000 | |||||||||||||||
ARL Healthcare Inc. [Member] | Cannabis Licenses [Member] | ||||||||||||||||
Carrying value less amortization | $ 77,000 | $ 77,000 | ||||||||||||||
KPG of Anna LLC and KPG of Harrisburg LLC [Member] | ||||||||||||||||
Stock issued during period, shares, acquisitions | 1,000,000 | |||||||||||||||
KPG of Anna LLC and KPG of Harrisburg LLC [Member] | Purchase Agreement [Member] | ||||||||||||||||
Percentage of interests acquired in business acquisition | 100.00% | |||||||||||||||
The Harvest Foundation LLC [Member] | ||||||||||||||||
Percentage of interests acquired in business acquisition | 100.00% | |||||||||||||||
The Harvest Foundation LLC [Member] | Two Owners [Member] | ||||||||||||||||
Stock issued during period, shares, acquisitions | 1,000,000 | |||||||||||||||
Number common shares issued during period | 1,000,000 | |||||||||||||||
Sale of common stock amount | $ 1,200,000 | |||||||||||||||
Warrants to purchase shares of common stock | 400,000 | |||||||||||||||
Meditaurus LLC [Member] | Purchase Agreement [Member] | ||||||||||||||||
Stock issued during period, shares, acquisitions | 752,260 | |||||||||||||||
Stock issued during period, value, acquisitions | $ 2,080,000 | |||||||||||||||
Percentage of interests acquired in business acquisition | 70.00% | |||||||||||||||
Payment for business acquisition | 2,800,000 | |||||||||||||||
Cash used for acquisition | $ 720,000 | |||||||||||||||
Percentage for royalty | 10.00% | |||||||||||||||
Percentage for royalty, description | For a period of ten years following June 1, 2020, certain former members of MediTaurus shall be paid a royalty on the Company's receipts from the licensing of MT Property, with the royalty percentage commencing at 10% and decreasing to 2% over time. | |||||||||||||||
Meditaurus LLC [Member] | Purchase Agreement [Member] | June 1, 2020 [Member] | ||||||||||||||||
Percentage of interests acquired in business acquisition | 30.00% | 30.00% | ||||||||||||||
AgriMed Industries of PA LLC [Member] | Purchase Agreement [Member] | ||||||||||||||||
Stock issued during period, value, acquisitions | $ 8,000,000 | |||||||||||||||
Percentage of interests acquired in business acquisition | 100.00% | |||||||||||||||
Terrace Inc. [Member] | ||||||||||||||||
Percentage of interests acquired in business acquisition | 8.95% | |||||||||||||||
Payment for business acquisition | $ 2,949,000 | |||||||||||||||
Cash used for acquisition | $ 3,100,000 |
Acquisitions - Schedule of Fair
Acquisitions - Schedule of Fair Value of Assets Acquired on Acquisition (Details) | Jun. 30, 2019USD ($) |
Betty's Eddies [Member] | |
Inventory | $ 46,544 |
Machinery and equipment | 130,255 |
Goodwill | 333,201 |
Total fair value of consideration | 510,000 |
iRollie LLC [Member] | |
Cash and cash equivalents | 13,494 |
Goodwill | 266,682 |
Total fair value of consideration | 280,176 |
ARL Healthcare Inc. [Member] | |
Machinery and equipment | 21,000 |
Cannabis licenses | 185,000 |
Accounts payable | (120,689) |
Due to related parties | (92,765) |
Total identifiable net assets | (7,454) |
Goodwill | 731,902 |
Total fair value of consideration | 724,448 |
Meditaurus LLC [Member] | |
Inventory | 519,750 |
Cash and cash equivalents | 128,997 |
Accounts receivable | 5,362 |
Tradename and customer lists | 3,346,668 |
Accounts payable | (777) |
Total fair value of consideration | 4,000,000 |
Noncontrolling interests | (1,200,000) |
Total fair value consideration, net of noncontrolling interests | $ 2,800,000 |
Investments (Details Narrative)
Investments (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||||||
Jul. 31, 2019 | Jun. 30, 2019 | May 31, 2019 | Feb. 28, 2019 | Dec. 31, 2018 | Aug. 31, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Jan. 31, 2019 | |
Ownership percentage | 23.00% | ||||||||||
Earnings in equity method investments on net income | $ (45,465) | $ 1,912,942 | |||||||||
Shares of common stock exchanged, value | 2,627,754 | ||||||||||
Investments | $ 35,662,106 | $ 1,672,163 | 35,662,106 | 35,662,106 | |||||||
Number of common stock shares issued, values | 2,600,000 | 8,461,003 | |||||||||
Billed amount | 25,672,676 | $ 2,937,325 | 29,188,492 | $ 5,020,275 | |||||||
Binske [Member] | Licensing Agreement [Member] | Subsequent Event [Member] | |||||||||||
Billed amount | |||||||||||
Vitiprints [Member] | Licensing Agreement [Member] | |||||||||||
Non-refundable payment | $ 250,000 | ||||||||||
Percentage of royalty on net revenue | 10.00% | ||||||||||
Payments for royalties | $ 250,000 | ||||||||||
Maximum [Member] | Binske [Member] | Licensing Agreement [Member] | Subsequent Event [Member] | |||||||||||
Percentage for royalty | 12.50% | ||||||||||
Minimum [Member] | Binske [Member] | Licensing Agreement [Member] | Subsequent Event [Member] | |||||||||||
Percentage for royalty | 10.00% | ||||||||||
CVP Worldwide LLC [Member] | |||||||||||
Investments | 1,080,016 | $ 1,172,163 | 300,000 | 1,080,016 | 1,080,016 | ||||||
Contracted cash investment | $ 500,000 | ||||||||||
Number of common stock issued during period | 378,259 | ||||||||||
Number of common stock shares issued, values | $ 915,000 | ||||||||||
Percentage on minority ownership interest | 23.00% | ||||||||||
Number of revenue shares earned | |||||||||||
Equity method investments | 92,000 | $ 43,000 | 92,000 | 92,000 | |||||||
Equity method investment market value | 1,080,000 | $ 1,172,000 | 1,080,000 | 1,080,000 | |||||||
Iconic Ventures Inc. [Member] | Maximum [Member] | |||||||||||
Percentage on minority ownership interest | 10.00% | ||||||||||
Chooze Corp. [Member] | |||||||||||
Ownership percentage | 2.70% | ||||||||||
Investments | 258,000 | 258,000 | 258,000 | ||||||||
Note receivable | $ 258,000 | ||||||||||
Impairment charges on investments | |||||||||||
Terrace Inc. [Member] | |||||||||||
Shares of common stock exchanged, value | $ 1,590,000 | ||||||||||
Percentage for acquired interest rate | 8.95% | ||||||||||
Investment carried cost | $ 1,590,000 | ||||||||||
Number of common stock issued during period | 500,000 | ||||||||||
Iconic Ventures Inc. [Member] | |||||||||||
Investments | 500,000 | $ 500,000 | 500,000 | 500,000 | |||||||
Number of shares purchased during the period | 2,500,000 | ||||||||||
Value of shares purchased during period | $ 500,000 | ||||||||||
GenCanna Global, Inc. [Member] | |||||||||||
Subordinated secured convertible debentures | 30,000,000 | ||||||||||
Debt conversion amount | $ 229,000 | ||||||||||
Earnings in equity method investments on net income | 200,000 | ||||||||||
Employee pool bonus fund | 10,000,000 | ||||||||||
Investments | $ 32,234,403 | $ 32,234,403 | $ 32,234,403 |
Investments - Schedule of Inves
Investments - Schedule of Investments (Details) - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 | Aug. 31, 2018 | Jun. 30, 2018 |
Total investments | $ 35,662,106 | $ 1,672,163 | ||
Iconic Ventures Inc. [Member] | ||||
Total investments | 500,000 | 500,000 | ||
CVP Worldwide LLC [Member] | ||||
Total investments | 1,080,016 | 1,172,163 | $ 300,000 | |
GenCanna Global, Inc. [Member] | ||||
Total investments | 32,234,403 | |||
Terrace Inc. [Member] | ||||
Total investments | 1,590,000 | |||
Chooze Corp. [Member] | ||||
Total investments | $ 257,687 |
Deferred Rents Receivable (Deta
Deferred Rents Receivable (Details Narrative) | Mar. 31, 2019ft² | Jun. 30, 2019USD ($)ft² | Dec. 31, 2018USD ($) | Sep. 30, 2016ft² |
Area of land | 300,000 | |||
Cumulative fixed rental receipts | $ | $ 7,500,000 | $ 5,400,000 | ||
Revenue recognized | $ | 9,500,000 | 7,500,000 | ||
Deferred rents receivable | $ | $ 2,000,000 | $ 2,100,000 | ||
Delaware [Member] | ||||
Area of land | 100,000 | 100,000 | 45,000 | |
Percentage of space occupied | 100.00% | |||
Non-cancelable lease agreement, term | 20 years | |||
Lease expiration description | The lease term is 10 years, with an option to extend the term for three additional five-year periods. | Lease expiring in 2035. | ||
Delaware [Member] | Retails Space [Member] | ||||
Area of land | 4,000 | |||
Illinois [Member] | ||||
Area of land | 3,400 | |||
Non-cancelable lease agreement, term | 20 years | |||
Lease expiration description | Lease expiring in 2036. | |||
Maryland [Member ] | ||||
Area of land | 180,000 | |||
Non-cancelable lease agreement, term | 20 years | |||
Massachusetts [Member] | Non-Cannabis [Member] | ||||
Area of land | 138,000 | |||
Lease expiration description | Approximately half of the available square footage is leased to a non-cannabis manufacturing company under a five-year lease. |
Deferred Rents Receivable - Sch
Deferred Rents Receivable - Schedule of Future Minimum Rental Receipts for Non-cancelable Leases and Subleases (Details) | Jun. 30, 2019USD ($) |
Revenue Recognition and Deferred Revenue [Abstract] | |
2019 | $ 2,071,161 |
2020 | 4,222,040 |
2021 | 4,368,640 |
2022 | 4,293,999 |
2023 | 3,997,651 |
Thereafter | 48,942,935 |
Total | $ 67,896,427 |
Due from Third Parties - Schedu
Due from Third Parties - Schedule of Due from Third Parties (Details) - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 |
Due from third parties | $ 2,862,681 | $ 3,860,377 |
Kind Therapeutics USA Inc. [Member] | ||
Due from third parties | 590,016 | 2,679,496 |
KPG of Anna LLC [Member] | ||
Due from third parties | 81,066 | 482,700 |
KPG of Harrisburg LLC [Member] | ||
Due from third parties | 46,516 | 449,385 |
Harvest Foundation LLC [Member] | ||
Due from third parties | $ 1,145,083 | $ 248,796 |
Notes Receivable (Details Narra
Notes Receivable (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 7 Months Ended | |||||||||
May 30, 2019 | Jan. 31, 2019 | May 31, 2016 | Oct. 31, 2018 | Jun. 30, 2019 | Oct. 31, 2018 | Jun. 30, 2018 | Apr. 30, 2016 | Jul. 31, 2019 | May 31, 2019 | Feb. 28, 2019 | Dec. 31, 2018 | Aug. 31, 2018 | |
Proceeds from notes receivable | $ 117,006 | $ 22,125 | |||||||||||
Notes receivable, current | 821,524 | $ 51,462 | |||||||||||
Ownership percentage | 23.00% | ||||||||||||
Chooze Corp. [Member] | |||||||||||||
Proceeds from notes receivable | $ 250,000 | ||||||||||||
Debt interest rate | 8.00% | 8.00% | |||||||||||
Debt maturity description | Maturing in 2021 | ||||||||||||
Ownership percentage | 2.70% | ||||||||||||
Note receivable | $ 258,000 | ||||||||||||
Delaware Cannabis-licensee [Member] | |||||||||||||
Proceeds from notes receivable | $ 700,000 | ||||||||||||
Promissory note term | 10 years | ||||||||||||
Debt interest rate | 12.50% | ||||||||||||
Monthly payments | $ 10,100 | ||||||||||||
Notes receivable, current | 55,000 | $ 51,000 | |||||||||||
Atalo Holdings Inc [Member] | |||||||||||||
Debt interest rate | 6.00% | ||||||||||||
Loan to related party | $ 750,000 | $ 750,000 | |||||||||||
Percentage for acquired interest rate | 25.00% | ||||||||||||
Debt maturity description | Principal and interest payable in April 3, 2020. | ||||||||||||
Atalo Holdings Inc [Member] | Subsequent Event [Member] | |||||||||||||
Loan to related party | $ 230,000 | ||||||||||||
Healer LLC [Member] | Dr. Dustin Sulak [Member] | |||||||||||||
Proceeds from notes receivable | $ 300,000 | $ 500,000 | |||||||||||
Debt interest rate | 6.00% | ||||||||||||
Debt maturity description | Principal and interest payable on the maturity date which is three years from issuance. | ||||||||||||
KPG of Anna LLC [Member] | |||||||||||||
Proceeds from notes receivable | 451,000 | ||||||||||||
KPG of Harrisburg LLC [Member] | |||||||||||||
Proceeds from notes receivable | $ 405,000 | ||||||||||||
KPG of Anna LLC & KPG of Harrisburg LLC [Member] | |||||||||||||
Debt interest rate | 12.00% | ||||||||||||
Notes receivable, current | $ 12,000 | ||||||||||||
Debt maturity description | Monthly principal and interest payments due through December 2038. | ||||||||||||
Maryland Health & Wellness Center Inc [Member] | Construction Loan [Member] | |||||||||||||
Debt interest rate | 8.00% | ||||||||||||
Debt maturity description | Principal and interest payable in January 2020, provided however, upon the two-year anniversary of final state approval of MHWC's dispensing license. | ||||||||||||
Ownership percentage | 20.00% |
Notes Receivable - Schedule of
Notes Receivable - Schedule of Notes Receivable (Details) - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 |
Total notes receivable | $ 3,292,391 | $ 1,143,839 |
Notes receivable, current portion | 821,524 | 51,462 |
Notes receivable, less current portion | 2,470,867 | 1,092,377 |
First State Compassion Center [Member] | ||
Total notes receivable | 553,791 | 578,723 |
Healer LLC [Member] | ||
Total notes receivable | 822,015 | 307,429 |
Atalo Holdings Inc [Member] | ||
Total notes receivable | 755,113 | |
KPG of Anna LLC [Member] | ||
Total notes receivable | 447,712 | |
KPG of Harrisburg LLC [Member] | ||
Total notes receivable | 398,803 | |
Maryland Health & Wellness Center Inc [Member] | ||
Total notes receivable | 310,882 | |
Chooze Corp. [Member] | ||
Total notes receivable | $ 257,687 |
Inventory_Unearned Revenue Fr_2
Inventory/Unearned Revenue From Related Party (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Payment for purchase of inventory | $ 16,700,000 | $ 3,300,000 | ||||
Proceeds from sale of inventory | $ 28,000,000 | |||||
Billed amount | 25,672,676 | $ 2,937,325 | 29,188,492 | $ 5,020,275 | ||
Accounts receivable from related party | 25,177,845 | 25,177,845 | ||||
Revenues from related party | 22,014,878 | 22,014,878 | ||||
Gross profit | 8,927,123 | $ 2,023,968 | 11,188,149 | $ 3,218,049 | ||
Gen Canna [Member] | ||||||
Proceeds from sale of inventory | $ 18,000,000 | |||||
Billed amount, description | The seeds are to be harvested by October 2019, and accordingly the Company provided GenCanna with extended payment terms, allowing full payments to be made by December 2019. | |||||
Costs associated with unearned revenue | 15,700,000 | $ 15,700,000 | ||||
Unearned revenue | 3,200,000 | 3,200,000 | ||||
Accounts receivable from related party | $ 25,200,000 | 25,200,000 | ||||
Revenues from related party | 22,000,000 | |||||
Gen Canna [Member] | Billed Revenues [Member] | ||||||
Proceeds from sale of inventory | 15,700,000 | |||||
Billed amount | 25,200,000 | |||||
MariMed Hemp Inc. [Member] | ||||||
Payment for purchase of inventory | 20,000,000 | |||||
MediTaurus [Member] | Hemp Seeds [Member] | ||||||
Payment for purchase of inventory | 4,300,000 | |||||
MediTaurus [Member] | Hemp Oil [Member] | ||||||
Payment for purchase of inventory | $ 520,000 |
Debentures Receivable (Details
Debentures Receivable (Details Narrative) - GenCanna Global, Inc. [Member] - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Feb. 28, 2019 | |
Ownership percentage of investment | 33.50% | |
Debt interest rate | 9.00% | |
Maturity date, description | Original maturity of three years from issuance. | |
Earned and received interest income | $ 502,000 |
Property and Equipment (Details
Property and Equipment (Details Narrative) - USD ($) | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Additions to property and equipment | $ 3,900,000 | $ 5,700,000 | |
Construction in progress | $ 12,200,000 | ||
Depreciation and amortization | 471,000 | $ 254,000 | |
New Bedford, MA [Member] | |||
Construction in progress | 9,800,000 | ||
Middleborough, MA [Member] | |||
Construction in progress | $ 2,400,000 | ||
New Bedford, MA and Middleborough, MA [Member] | |||
Construction in progress | $ 2,300,000 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 |
Property plant and equipment, gross | $ 40,205,900 | $ 36,259,694 |
Less: accumulated depreciation | (2,602,019) | (2,159,830) |
Property and equipment, net | 37,603,881 | 34,099,864 |
Land [Member] | ||
Property plant and equipment, gross | 3,392,710 | 3,392,710 |
Buildings and Building Improvements [Member] | ||
Property plant and equipment, gross | 14,513,538 | 13,566,144 |
Tenant Improvements [Member] | ||
Property plant and equipment, gross | 625,882 | 5,348,882 |
Furniture and Fixtures [Member] | ||
Property plant and equipment, gross | 143,237 | 114,160 |
Machinery and Equipment [Member] | ||
Property plant and equipment, gross | 2,057,059 | 1,632,351 |
Construction in Progress [Member] | ||
Property plant and equipment, gross | $ 14,473,474 | $ 12,205,447 |
Debt (Details Narrative)
Debt (Details Narrative) | 1 Months Ended | 4 Months Ended | 6 Months Ended | 12 Months Ended | |||||||||
Jun. 30, 2019USD ($)ft²$ / sharesshares | Apr. 30, 2019USD ($) | Mar. 31, 2019USD ($)ft² | Dec. 31, 2018USD ($)$ / sharesshares | Sep. 30, 2018USD ($)$ / sharesshares | Jun. 30, 2018USD ($)$ / sharesshares | Nov. 30, 2017ft² | Dec. 31, 2018USD ($)$ / sharesshares | Jun. 30, 2019USD ($)ft²$ / sharesshares | Jun. 30, 2018USD ($)$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2016ft² | Sep. 30, 2016ft² | |
Area of land | ft² | 300,000 | 300,000 | |||||||||||
Repayment of notes | $ 700,000 | ||||||||||||
Number of warrants issued to purchase common stock | shares | 4,239,000 | 4,239,000 | |||||||||||
Common stock, subscriptions | shares | 752,260 | 97,136 | 97,136 | 752,260 | 97,136 | ||||||||
Minimum [Member] | |||||||||||||
Warrant term | 3 years | 3 years | |||||||||||
Warrant exercise price | $ / shares | $ 0.30 | $ 0.30 | |||||||||||
Maximum [Member] | |||||||||||||
Warrant term | 5 years | 5 years | |||||||||||
Warrant exercise price | $ / shares | $ 2.25 | $ 2.25 | |||||||||||
Secured Promissory Notes [Member] | |||||||||||||
Debt maturity description | December 2019 | September 2019 | |||||||||||
Interest rate | 13.00% | 10.00% | |||||||||||
Debt instrument, extended maturity description | The Company may extend the maturity date by up to three months upon thirty days' notice prior to the maturity date with an extension fee payment to the note holder of $300,000. | ||||||||||||
Promissory notes issued | $ 6,000,000 | $ 3,000,000 | $ 6,000,000 | ||||||||||
Debt instrument, extension fee | $ 300,000 | ||||||||||||
Secured Promissory Notes [Member] | MariMed Hemp Inc. [Member] | |||||||||||||
Debt instrument, extended maturity description | On the maturity date in January 2020, or earlier at Mari-Hemp's discretion, the principal balance shall be repaid plus a payment of $1.5 million. | ||||||||||||
Promissory notes issued | $ 10,000,000 | ||||||||||||
Repayment of additional debt | 1,500,000 | ||||||||||||
Repayment of notes | 162,000 | ||||||||||||
Interest expenses | 162,000 | ||||||||||||
Secured Promissory Notes [Member] | MariMed Hemp Inc. [Member] | Note Holder [Member] | |||||||||||||
Repayment of additional debt | $ 180,000 | ||||||||||||
Secured Promissory Notes [Member] | MariMed Hemp Inc. [Member] | Gen Canna [Member] | |||||||||||||
Debt maturity description | December 2019 | ||||||||||||
Debt instrument, extended maturity description | The principal balance plus a payment of $180,000 shall be due in full on the earlier of the maturity date or three business days after Mari-Hemp's receipt of payment by GenCanna of the Secured Receivables. | ||||||||||||
Promissory notes issued | $ 1,000,000 | ||||||||||||
Repayment of additional debt | 180,000 | ||||||||||||
Repayment of notes | 180,000 | ||||||||||||
Interest expenses | 52,000 | ||||||||||||
Secured Promissory Notes [Member] | MariMed Hemp Inc. [Member] | Gen Canna [Member] | Note Holder [Member] | |||||||||||||
Debt instrument, extension fee | $ 30,000 | ||||||||||||
Promissory Notes [Member] | |||||||||||||
Debt principal amount | $ 7,495,000 | $ 7,495,000 | $ 7,495,000 | ||||||||||
Repayment of notes | 700,000 | ||||||||||||
Warrant term | 3 years | ||||||||||||
Number of warrants issued to purchase common stock | shares | 750,000 | ||||||||||||
Warrant exercise price | $ / shares | $ 1.80 | ||||||||||||
Note discount recorded | 629,000 | $ 1,511,000 | 629,000 | 629,000 | |||||||||
Note carrying value | $ 3,000,000 | $ 2,370,000 | 2,370,000 | 3,000,000 | 2,370,000 | ||||||||
Value of warrant discount amortized | 882,000 | 629,000 | |||||||||||
Debt conversion of convertible shares | shares | 1,568,375 | ||||||||||||
Debt conversion principal amount | $ 1,075,000 | $ 1,075,000 | 1,075,000 | ||||||||||
Debt conversion of convertible debt | $ 829,000 | $ 2,500,000 | |||||||||||
Stock issued during period | shares | 2,596,313 | ||||||||||||
Common stock, subscriptions | shares | 79,136 | 79,136 | 79,136 | ||||||||||
Accrued interest | $ 95,000 | $ 95,000 | $ 95,000 | ||||||||||
Promissory Note [Member] | Minimum [Member] | |||||||||||||
Debt conversion price | $ / shares | $ 0.65 | $ 0.65 | $ 0.65 | ||||||||||
Promissory Note [Member] | Maximum [Member] | |||||||||||||
Debt conversion price | $ / shares | $ 0.90 | $ 0.90 | $ 0.90 | ||||||||||
Delaware [Member] | |||||||||||||
Area of land | ft² | 100,000 | 100,000 | 100,000 | 45,000 | |||||||||
Mortgage Agreement [Member] | |||||||||||||
Agreement term | 10 years | ||||||||||||
Debt payment, description | From the start of the mortgage through May 2019, the Company is required to make monthly payments of interest-only at a rate equal to the monthly prime rate plus 2%, with a floor of 6.25%. From May 2019 to May 2024, the Company shall make principal and interest payments at a rate equal to the prime rate on May 2, 2019 plus 2%, with a floor of 6.25%. Principal and interest payments shall continue from May 2024 through the end of the lease at a rate equal to the prime rate on May 2, 2024 plus 2%, with a floor of 6.25%. | ||||||||||||
Debt principal amount | $ 4,877,000 | $ 4,895,000 | $ 4,895,000 | $ 4,877,000 | $ 4,895,000 | ||||||||
Debt principal amount, current | 110,000 | 63,000 | 63,000 | 110,000 | 63,000 | ||||||||
Mortgage Agreement [Member] | DuQuoin State Bank [Member ] | |||||||||||||
Area of land | ft² | 3,400 | ||||||||||||
Debt principal amount | 838,000 | 850,000 | 850,000 | 838,000 | 850,000 | ||||||||
Debt principal amount, current | $ 23,000 | 23,000 | 23,000 | $ 23,000 | 23,000 | ||||||||
Interest rate | 8.50% | ||||||||||||
Debt instrument, extended maturity description | The mortgage was renewed in May 2019 at a rate of 8.5% per annum. | ||||||||||||
Mortgage Agreement [Member] | Prime Rate [Member] | |||||||||||||
Variable rate | 2.00% | ||||||||||||
Mortgage Agreement [Member] | Prime Rate [Member] | May 2, 2019 [Member] | |||||||||||||
Variable rate | 2.00% | ||||||||||||
Mortgage Agreement [Member] | Prime Rate [Member] | May 2, 2024 [Member] | |||||||||||||
Variable rate | 2.00% | ||||||||||||
Mortgage Agreement [Member] | Floor Rate [Member] | |||||||||||||
Variable rate | 6.25% | ||||||||||||
Mortgage Agreement [Member] | Floor Rate [Member] | May 2, 2019 [Member] | |||||||||||||
Variable rate | 6.25% | ||||||||||||
Mortgage Agreement [Member] | Floor Rate [Member] | May 2, 2024 [Member] | |||||||||||||
Variable rate | 6.25% | ||||||||||||
Mortgage Agreement [Member] | New Bedford, Massachusetts [Member] | |||||||||||||
Area of land | ft² | 138,000 | ||||||||||||
Cultivating and processing facility | ft² | 70,000 | ||||||||||||
Mortgage Agreement [Member] | Delaware [Member] | |||||||||||||
Area of land | ft² | 45,070 | 45,070 | |||||||||||
Debt principal amount | $ 1,743,000 | 1,792,000 | 1,792,000 | $ 1,743,000 | 1,792,000 | ||||||||
Debt principal amount, current | $ 105,000 | $ 102,000 | $ 102,000 | $ 105,000 | $ 102,000 | ||||||||
Debt maturity description | The mortgage matures in 2031 | ||||||||||||
Mortgage Agreement [Member] | Delaware [Member] | Prime Rate [Member] | |||||||||||||
Interest rate | 1.50% | ||||||||||||
Mortgage Agreement [Member] | Delaware [Member] | Floor Rate [Member] | |||||||||||||
Interest rate | 5.25% | ||||||||||||
Mortgage Agreement [Member] | Delaware [Member] | September 2021 [Member] | |||||||||||||
Interest rate | 5.25% | ||||||||||||
10M Note [Member] | Secured Promissory Notes [Member] | MariMed Hemp Inc. [Member] | |||||||||||||
Warrant term | 3 years | 3 years | |||||||||||
Number of warrants issued to purchase common stock | shares | 375,000 | 375,000 | |||||||||||
Warrant exercise price | $ / shares | $ 4.50 | $ 4.50 | |||||||||||
Note discount recorded | $ 601,000 | $ 601,000 | |||||||||||
Interest expenses | $ 65,000 | ||||||||||||
Note carrying value | $ 9,460,000 | $ 9,460,000 |
Debt - Schedule of Mortgages Pa
Debt - Schedule of Mortgages Payable (Details) - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 |
Total mortgages payable | $ 35,038,404 | |
Mortgage [Member] | ||
Total mortgages payable | 7,457,799 | $ 7,536,812 |
Mortgages payable, current portion | (238,386) | (188,231) |
Mortgages payable, less current portion | 7,219,413 | 7,348,581 |
Mortgage [Member] | Bank of New England - Massachusetts property [Member] | ||
Total mortgages payable | 4,877,624 | 4,895,000 |
Mortgage [Member] | Bank of New England - Delaware Property [Member] | ||
Total mortgages payable | 1,742,619 | 1,791,736 |
Mortgage [Member] | DuQuoin State Bank - Illinois Properties [Member] | ||
Total mortgages payable | $ 837,556 | $ 850,076 |
Debt - Schedule of Aggregate Ma
Debt - Schedule of Aggregate Maturities of Debt Outstanding (Details) | Jun. 30, 2019USD ($) |
Debt Disclosure [Abstract] | |
2019 | $ 10,496,536 |
2020 | 16,495,007 |
2021 | 7,762,293 |
2022 | 280,348 |
2023 | 299,689 |
Thereafter | 6,262,463 |
Total | 41,596,336 |
Less discounts | (6,557,932) |
Long-term debt, net | $ 35,038,404 |
Debentures Payable (Details Nar
Debentures Payable (Details Narrative) - USD ($) | 1 Months Ended | 2 Months Ended | 3 Months Ended | 6 Months Ended | ||||||
Jun. 30, 2019 | May 31, 2019 | Jan. 31, 2019 | Dec. 31, 2018 | Nov. 30, 2018 | Nov. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Aug. 31, 2018 | |
Proceeds from issuance of convertible debt | $ 1,998,360 | |||||||||
Ownership percentage | 23.00% | |||||||||
Fair value of warrants | $ 198,200 | |||||||||
Warrants to purchase common stock | 4,239,000 | |||||||||
Amortization of original issue discount | 28,920 | |||||||||
Minimum [Member] | ||||||||||
Warrant term | 3 years | |||||||||
Warrant exercise price per share | $ 0.30 | |||||||||
Maximum [Member] | ||||||||||
Warrant term | 5 years | |||||||||
Warrant exercise price per share | $ 2.25 | |||||||||
17.5M Debentures Holder [Member] | ||||||||||
Debt principal amount | $ 13,750,000 | $ 13,750,000 | 13,750,000 | |||||||
Unamortized balances of the beneficial conversion feature | 5,152,000 | 5,152,000 | 5,152,000 | |||||||
Unamortized balance of warrants discount | 1,575,000 | 1,575,000 | 1,575,000 | |||||||
Unamortized balance of original issue discount | 287,000 | 287,000 | 287,000 | |||||||
Debentures carrying value | 6,736,000 | 6,736,000 | 6,736,000 | |||||||
Convertible Debentures [Member] | ||||||||||
Debt principal amount | 1,750,000 | $ 600,000 | $ 1,400,000 | $ 1,400,000 | $ 1,400,000 | $ 1,750,000 | 1,750,000 | |||
Debt conversion of convertible shares | 233,194 | 524,360 | 524,360 | 923,185 | ||||||
Debt conversion price per share | $ 3.04 | $ 2.23 | $ 2.23 | |||||||
Accrued interest | 181,000 | $ 97,000 | $ 36,000 | $ 36,000 | $ 36,000 | $ 181,000 | 181,000 | |||
Amortization of the beneficial conversion feature | 2,282,000 | |||||||||
Amortization of the warrants discount | 320,000 | |||||||||
Amortization of original issue discount | 29,000 | |||||||||
Accrued interest | $ 280,000 | $ 280,000 | $ 280,000 | |||||||
Convertible Debentures [Member] | Minimum [Member] | ||||||||||
Debt conversion price per share | $ 1.74 | $ 2.90 | $ 1.74 | $ 1.74 | ||||||
Convertible Debentures [Member] | Maximum [Member] | ||||||||||
Debt conversion price per share | $ 1.74 | $ 3.06 | $ 1.74 | $ 1.74 | ||||||
Convertible Debentures [Member] | 10M Debentures Holder [Member] | ||||||||||
Debt principal amount | $ 10,000,000 | $ 10,000,000 | ||||||||
Interest bearing, rate | 6.00% | 6.00% | ||||||||
Debt mature | 2 years | |||||||||
Debt instrument discount rate | 1.00% | 1.00% | ||||||||
Proceeds from issuance of convertible debt | $ 9,900,000 | |||||||||
Debt interest rate | 80.00% | |||||||||
Ownership percentage | 4.99% | 4.99% | ||||||||
Accrued unpaid interest | 10.00% | |||||||||
Debt redemption percentage | 110.00% | |||||||||
Warrant term | 3 years | 3 years | ||||||||
Debt conversion of convertible shares | 324,675 | |||||||||
Fair value of warrants | $ 1,057,000 | |||||||||
Intrinsic value of the beneficial conversion feature | 5,570,000 | |||||||||
Beneficial conversion feature, additional discount | $ 1,057,000 | $ 1,057,000 | ||||||||
Convertible Debentures [Member] | 10M Debentures Holder [Member] | Securities Purchase Agreement [Member] | ||||||||||
Debt conversion of convertible shares | 500,000,000 | |||||||||
Convertible Debentures [Member] | 10M Debentures Holder [Member] | Minimum [Member] | ||||||||||
Debt conversion price per share | $ 3.50 | $ 3.50 | ||||||||
Convertible Debentures [Member] | 10M Debentures Holder [Member] | Maximum [Member] | ||||||||||
Debt conversion price per share | $ 5.50 | $ 5.50 | ||||||||
Convertible Debentures [Member] | 5M Debentures Holder [Member] | ||||||||||
Debt mature | 2 years | |||||||||
Debt instrument discount rate | 1.00% | |||||||||
Proceeds from issuance of convertible debt | $ 4,950,000 | |||||||||
Convertible debentures | $ 5,000,000 | |||||||||
Convertible Debentures [Member] | 2.5M Debentures Holder [Member] | ||||||||||
Debt mature | 2 years | |||||||||
Debt instrument discount rate | 7.00% | 7.00% | 7.00% | |||||||
Proceeds from issuance of convertible debt | $ 2,350,000 | |||||||||
Convertible debentures | $ 2,500,000 | $ 2,500,000 | $ 2,500,000 | |||||||
Debt instrument, description | The "$2.5M Debentures," and together with the $5M Debentures, the :"$7.5M Debentures". | |||||||||
Convertible Debentures [Member] | 7.5M Debentures Holder [Member] | ||||||||||
Warrant term | 3 years | 3 years | 3 years | |||||||
Fair value of warrants | $ 929,000 | |||||||||
Intrinsic value of the beneficial conversion feature | $ 3,385,000 | |||||||||
Debt instrument, description | The $7.5M Debentures were sold to the Holder of the $10M Debentures. The terms of the $7.5M Debentures are consistent with the terms of the $10M Debentures, except that (i) no interest shall accrue on the $2.5M Debentures, (ii) the issue discount on the $2.5M Debentures is 7%, compared to 1% on the $10M Debentures and $5M Debentures, and (iii) other small variations, most notably a cap on the conversion price. The SPA, registration rights agreement, and addendum to the SPA were all amended and restated to incorporate the $7.5M Debentures. | |||||||||
Warrants to purchase common stock | 550,000 | 550,000 | 550,000 | |||||||
Warrant exercise price per share | $ 5 | $ 5 | $ 5 | |||||||
17.5M Debentures Holder [Member] | ||||||||||
Debt principal amount | $ 2,350,000 | 8,600,000 | $ 2,350,000 | $ 2,350,000 | ||||||
Debt conversion of convertible shares | 1,156,379 | |||||||||
Accrued interest | $ 278,000 | 62,000 | $ 278,000 | $ 278,000 | ||||||
Unamortized balances of the beneficial conversion feature | 4,048,000 | |||||||||
Unamortized balance of warrants discount | 966,000 | |||||||||
Unamortized balance of original issue discount | 91,000 | |||||||||
Debentures carrying value | $ 3,600,000 |
Equity (Details Narrative)
Equity (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2019 | Jan. 31, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Preferred stock, shares authorized | 50,000,000 | 50,000,000 | 50,000,000 | 50,000,000 | |||
Loss on conversion | $ (563,119) | $ (1,776,960) | |||||
Share issued price | $ 3.25 | $ 3.25 | $ 3.25 | ||||
Number of shares issued during period, value | $ 2,600,000 | $ 8,461,003 | |||||
Number of warrants issued to purchase common stock | 4,239,000 | 4,239,000 | |||||
17.5M Debentures Holder [Member] | |||||||
Debt converted into common shares | 1,156,379 | ||||||
Promissory notes | $ 2,350,000 | $ 2,350,000 | $ 2,350,000 | $ 8,600,000 | |||
Accrued interest | $ 278,000 | $ 278,000 | $ 278,000 | 62,000 | |||
Harvest Foundation LLC [Member] | |||||||
Number of common stock issued during period | 1,000,000 | ||||||
Terrace Inc [Member] | |||||||
Number of common stock issued during period | 500,000 | ||||||
iRollie LLC [Member] | |||||||
Number of shares issued for acquisition | 264,317 | ||||||
Third Parties [Member] | |||||||
Loss on conversion | $ 959,000 | ||||||
Shares in exchange for services | 1,313,901 | ||||||
Number of shares issued to retire promissory note, shares | 1,679,486 | ||||||
Number of shares issued to retire promissory note | $ 1,175,000 | ||||||
Non cash loss on conversions | $ 918,000 | ||||||
Previously Issued Subscription [Member] | |||||||
Number of common stock issued during period | 97,136 | 1,000,000 | |||||
Number of shares issued during period, value | $ 169,000 | $ 370,000 | |||||
Minimum [Member] | |||||||
Share issued price | $ 0.50 | $ 0.50 | |||||
Maximum [Member] | |||||||
Share issued price | $ 1.30 | $ 1.30 | |||||
Common Stock [Member] | |||||||
Number of common stock issued during period | 799,995 | 10,111,578 | |||||
Number of shares issued during period, value | $ 800 | $ 10,112 | |||||
Number of shares issued for acquisition | 1,000,000 | ||||||
Options [Member] | |||||||
Options to purchase shares of common stock | 358,446 | 300,000 | |||||
Warrant [Member] | |||||||
Number of warrants issued to purchase common stock | 666,104 | 666,104 | 1,425,379 | 666,104 | 1,425,379 | ||
Series A convertible Preferred [Member] | |||||||
Preferred stock, shares authorized | 500,000 | ||||||
Debt converted into common shares | 970,989 | ||||||
Debt instrument conversion price | $ 0.55 | ||||||
Loss on conversion | $ 34,000 | ||||||
Preferred stock dividend, rate | 6.00% | ||||||
Market capitalization | $ 50,000,000 | ||||||
Discount to selling price, percentage | 25.00% | ||||||
Common Stock Issuance Obligations [Member] | |||||||
Promissory notes | $ 50,000 | ||||||
Subscription outstanding, shares | 79,136 | ||||||
Accrued interest | $ 1,454 | ||||||
Subscription outstanding, value | $ 95,000 | ||||||
Number of shares subscribed for exercise of warrants | 32,083 | ||||||
Number of shares issued to settlement of debt, shares | 2,001,641 | ||||||
Number of shares issued to settlement of debt | $ 1,951,600 | ||||||
Common stock shares subscription | 9,281 | 9,281 | |||||
Payment of rent | $ 20,000 | ||||||
Common Stock Issuance Obligations [Member] | September 2018 through January 2019 [Member] | |||||||
Subscription outstanding, shares | 18,000 | ||||||
Subscription outstanding, value | $ 74,000 | ||||||
Common Stock Issuance Obligations [Member] | Meditaurus LLC [Member] | |||||||
Number of common stock issued during period | 752,260 | ||||||
Number of shares issued during period, value | $ 2,080,000 |
Stock Options (Details Narrativ
Stock Options (Details Narrative) - USD ($) | 1 Months Ended | 6 Months Ended | |||
Dec. 31, 2018 | May 31, 2018 | Jan. 31, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Number of stock options forfeited | 300,000 | ||||
Two Board Members [Member] | |||||
Number of stock options forfeited | 200,000 | ||||
Options One [Member] | |||||
Options to purchase shares of common stock | 1,450,000 | 520,000 | |||
Exercise price of common stock | $ 0.90 | ||||
Stock options expiration period, description | Expiring between December 2020 and December 2022. | ||||
Option term | 5 years | ||||
Number of stock options granted | 200,000 | ||||
Amortized fair value of options granted | $ 28,000 | ||||
Adjusted fair value of options granted | $ 208,000 | ||||
Number of stock options forfeited | 150,000 | ||||
Amortized fair value of options for forfeiture | $ 50,000 | ||||
Unamortized fair value of options for forfeiture | $ 158,000 | ||||
Purchase exercised options | 350,000 | ||||
Number of shares surrendered by board members | 139,985 | ||||
Options One [Member] | December 2020 and December 2022 [Member] | |||||
Non-cash equity compensation | $ 458,000 | ||||
Options One [Member] | Minimum [Member] | |||||
Exercise price of common stock | $ 0.14 | $ 0.08 | |||
Options One [Member] | Maximum [Member] | |||||
Exercise price of common stock | $ 0.77 | 0.77 | |||
Options Two [Member] | |||||
Options to purchase shares of common stock | 700,000 | ||||
Purchase exercised options | 400,000 | ||||
Number of shares surrendered by board members | 98,000 | ||||
Options Two [Member] | Minimum [Member] | |||||
Exercise price of common stock | 0.08 | ||||
Options Two [Member] | Maximum [Member] | |||||
Exercise price of common stock | $ 0.63 |
Stock Options - Schedule of Sto
Stock Options - Schedule of Stock Options Outstanding and Exercisable (Details) | 6 Months Ended |
Jun. 30, 2019$ / sharesshares | |
Outstanding shares under option | 7,790,000 |
Exercisable shares under option | 6,935,000 |
Range One [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.080 |
Outstanding shares under option | 100,000 |
Exercisable shares under option | 100,000 |
Outstanding remaining life in years | 5 months 20 days |
Range Two [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.130 |
Outstanding shares under option | 200,000 |
Exercisable shares under option | 200,000 |
Outstanding remaining life in years | 1 year |
Range Three [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.140 |
Outstanding shares under option | 100,000 |
Exercisable shares under option | 100,000 |
Outstanding remaining life in years | 6 months |
Range Four [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.140 |
Outstanding shares under option | 550,000 |
Exercisable shares under option | 550,000 |
Outstanding remaining life in years | 1 year 6 months 3 days |
Range Five [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.150 |
Outstanding shares under option | 1,000,000 |
Exercisable shares under option | 1,000,000 |
Outstanding remaining life in years | 2 months 30 days |
Range Six [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.250 |
Outstanding shares under option | 1,000,000 |
Exercisable shares under option | 1,000,000 |
Outstanding remaining life in years | 2 months 30 days |
Range Seven [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.330 |
Outstanding shares under option | 50,000 |
Exercisable shares under option | 50,000 |
Outstanding remaining life in years | 1 year 8 months 9 days |
Range Eight [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.350 |
Outstanding shares under option | 1,000,000 |
Exercisable shares under option | 1,000,000 |
Outstanding remaining life in years | 2 months 30 days |
Range Nine [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.450 |
Outstanding shares under option | 190,000 |
Exercisable shares under option | 190,000 |
Outstanding remaining life in years | 2 years 3 months 4 days |
Range Ten [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.630 |
Outstanding shares under option | 300,000 |
Exercisable shares under option | 300,000 |
Outstanding remaining life in years | 2 years 6 months 3 days |
Range Eleven [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.770 |
Outstanding shares under option | 200,000 |
Exercisable shares under option | 200,000 |
Outstanding remaining life in years | 3 years 6 months 3 days |
Range Twelve [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.900 |
Outstanding shares under option | 50,000 |
Exercisable shares under option | 50,000 |
Outstanding remaining life in years | 3 years 10 months 14 days |
Range Thirteen [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 0.950 |
Outstanding shares under option | 50,000 |
Exercisable shares under option | 10,000 |
Outstanding remaining life in years | 3 years 6 months 3 days |
Range Fourteen [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 2.320 |
Outstanding shares under option | 300,000 |
Exercisable shares under option | 60,000 |
Outstanding remaining life in years | 4 years 2 months 12 days |
Range Fifteen [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 2.450 |
Outstanding shares under option | 2,000,000 |
Exercisable shares under option | 2,000,000 |
Outstanding remaining life in years | 3 years 5 months 23 days |
Range Sixteen [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 2.500 |
Outstanding shares under option | 100,000 |
Exercisable shares under option | 25,000 |
Outstanding remaining life in years | 4 years 1 month 27 days |
Range Seventeen [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 2.650 |
Outstanding shares under option | 200,000 |
Exercisable shares under option | 100,000 |
Outstanding remaining life in years | 4 years 2 months 27 days |
Range Eighteen [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 2.850 |
Outstanding shares under option | 75,000 |
Exercisable shares under option | |
Outstanding remaining life in years | 3 years 5 months 12 days |
Range Nineteen [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 2.850 |
Outstanding shares under option | 100,000 |
Exercisable shares under option | |
Outstanding remaining life in years | 4 years 5 months 12 days |
Range Twenty [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 3 |
Outstanding shares under option | 25,000 |
Exercisable shares under option | |
Outstanding remaining life in years | 4 years 5 months 20 days |
Range Twenty One [Member] | |
Outstanding and exercisable exercise price per share | $ / shares | $ 3.725 |
Outstanding shares under option | 200,000 |
Exercisable shares under option | |
Outstanding remaining life in years | 4 years 5 months 12 days |
Warrants (Details Narrative)
Warrants (Details Narrative) - USD ($) | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Number of warrants issued to purchase common stock | 4,239,000 | |
Fair value of warrants | $ 198,200 | |
Number of warrants issued in exchange for services rendered | 470,000 | |
Compensation expense | $ 433,000 | |
Number of warrants issued in relation to promissory note | 237,500 | |
Warrants expiration date | Apr. 30, 2021 | |
Number of warrants issued in relation to sale of common stock | 3,531,500 | |
Fair value of warrants at issuance | $ 4,500,000 | |
Warrant [Member] | ||
Number of warrants issued to purchase common stock | 666,104 | 1,425,379 |
Warrant One [Member] | ||
Number of warrants issued to purchase common stock | 10,865,107 | 7,058,932 |
Minimum [Member] | ||
Warrants term | 3 years | |
Warrants exercise price | $ 0.30 | |
Minimum [Member] | Warrant [Member] | ||
Warrants exercise price | $ 0.12 | 0.10 |
Minimum [Member] | Warrant One [Member] | ||
Warrants exercise price | 0.15 | $ 0.10 |
Maximum [Member] | ||
Warrants term | 5 years | |
Warrants exercise price | $ 2.25 | |
Maximum [Member] | Warrant [Member] | ||
Warrants exercise price | 1.75 | 0.50 |
Maximum [Member] | Warrant One [Member] | ||
Warrants exercise price | $ 5.50 | $ 2.25 |
Three Year Warrants One [Member] | ||
Debt instrument face amount | $ 7,500,000 | |
Warrants term | 3 years | |
Number of warrants issued to purchase common stock | 550,000 | |
Warrants exercise price | $ 5 | |
Fair value of warrants | $ 929,000 | |
Amortization of debt discount | 57,000 | |
Three Year Warrants Two [Member] | ||
Debt instrument face amount | $ 10,000,000 | |
Warrants term | 3 years | |
Number of warrants issued to purchase common stock | 375,000 | |
Warrants exercise price | $ 4.50 | |
Fair value of warrants | $ 601,000 | |
Amortization of debt discount | $ 65,000 | |
Debt instrument maturity date | Jan. 31, 2020 |
Revenues (Details Narrative)
Revenues (Details Narrative) - Revenues [Member] | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Three Clients [Member] | ||
Concentration risk, percentage | 95.00% | |
Two Clients [Member] | ||
Concentration risk, percentage | 75.00% |
Revenues - Schedule of Revenues
Revenues - Schedule of Revenues Comprised of Major Categories (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Total revenues | $ 25,672,676 | $ 2,937,325 | $ 29,188,492 | $ 5,020,275 |
Real Estate [Member] | ||||
Total revenues | 3,442,024 | 2,731,364 | ||
Management [Member] | ||||
Total revenues | 1,194,791 | 754,038 | ||
Supply Procurement [Member] | ||||
Total revenues | 1,906,399 | 1,241,835 | ||
Licensing [Member] | ||||
Total revenues | 568,127 | 281,557 | ||
Product Sales [Member] | ||||
Total revenues | 1,880 | |||
Other [Member] | ||||
Total revenues | 60,392 | 11,482 | ||
Product Sales from Related Party [Member] | ||||
Total revenues | $ 22,014,879 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||
Dec. 31, 2018 | Aug. 31, 2018 | Jan. 31, 2018 | Jun. 30, 2017 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Revenues from related party | $ 22,014,878 | $ 22,014,878 | ||||||
Ownership percentage | 23.00% | |||||||
Number of stock options forfeited | 300,000 | |||||||
Common stock exercise price | $ 3.25 | $ 3.25 | ||||||
Lease term | 10 years | |||||||
Expenses incurred under the leases | $ 34,000 | $ 6,000 | ||||||
Due to related parties | $ 276,000 | $ 77,000 | $ 77,000 | |||||
Minimum [Member] | ||||||||
Common stock exercise price | $ 0.50 | $ 0.50 | ||||||
Maximum [Member] | ||||||||
Common stock exercise price | $ 1.30 | $ 1.30 | ||||||
Options One [Member] | ||||||||
Purchase exercised options | 350,000 | |||||||
Number of stock options forfeited | 150,000 | |||||||
Number of shares surrendered by board members | 139,985 | |||||||
Stock options expiration period, description | Expiring between December 2020 and December 2022. | |||||||
Options Two [Member] | ||||||||
Purchase exercised options | 400,000 | |||||||
Number of shares surrendered by board members | 98,000 | |||||||
CEO [Member] | ||||||||
Purchase exercised options | 1,450,000 | |||||||
Stock options expiration period, description | Expiring between December 2020 and December 2022. | |||||||
CEO [Member] | Minimum [Member] | ||||||||
Common stock exercise price | $ 0.14 | |||||||
CEO [Member] | Maximum [Member] | ||||||||
Common stock exercise price | $ 0.77 | |||||||
Two Board Members [Member] | ||||||||
Number of stock options forfeited | 200,000 | |||||||
CEO and CFO [Member] | ||||||||
Due to related parties | $ 81,000 | 81,000 | $ 81,000 | |||||
Two Shareholders [Member] | ||||||||
Due to related parties | 60,000 | 60,000 | 60,000 | |||||
MariMed Advisors Inc. [Member] | ||||||||
Ownership percentage | 49.00% | |||||||
Common stock shares acquired | 75,000,000 | |||||||
Two Companies [Member] | CEO and CFO [Member] | ||||||||
Due to related parties | $ 135,000 | 17,000 | 17,000 | |||||
Due from related parties | 120,000 | 120,000 | ||||||
Repayment to related party | 120,000 | |||||||
Gen Canna [Member] | ||||||||
Due from related party | 25,200,000 | 25,200,000 | ||||||
Revenues from related party | 22,000,000 | |||||||
Unearned revenue | 3,200,000 | 3,200,000 | ||||||
Costs associated with unearned revenue | $ 15,700,000 | $ 15,700,000 |
Commitments and Contingencies_2
Commitments and Contingencies (Details Narrative) | Mar. 31, 2019ft² | Aug. 31, 2018 | Oct. 31, 2016ft² | Jun. 30, 2019USD ($)ft²Integer | Dec. 31, 2018USD ($) | Sep. 30, 2016ft² |
Number of operating leases | Integer | 5 | |||||
Number of finance leases | Integer | 3 | |||||
Area of land | 300,000 | |||||
Lease term | 10 years | |||||
Agreement term description | An employment agreement with the former CEO of the Company that provided this individual with salary, car allowances, stock options, life insurance, and other employee benefits, was terminated in 2017. | |||||
Accrued expenses | $ | $ 3,920,742 | $ 1,588,368 | ||||
Employment Agreement [Member] | ||||||
Weighted average operating lease remaining term | 9 years 10 months 25 days | |||||
Weighted average finance lease remaining term | 3 years 3 months 19 days | |||||
Weighted average discount rate for right-of-use assets | 7.50% | |||||
Weighted average discount rate for lease liabilities | 7.50% | |||||
Accrued expenses | $ | $ 1,043,000 | $ 1,043,000 | ||||
Finance Lease Commitments [Member] | Machinery [Member] | ||||||
Lease expiration, description | Expire in February 2022 through June 2024 | |||||
Delaware [Member] | ||||||
Area of land | 100,000 | 100,000 | 45,000 | |||
Lease term | 10 years | |||||
Lease expiration, description | The lease term is 10 years, with an option to extend the term for three additional five-year periods. | Lease expiring in 2035. | ||||
Delaware [Member] | Operating Lease Commitments [Member ] | ||||||
Area of land | 4,000 | |||||
Lease term | 5 years | |||||
Nevada [Member] | ||||||
Area of land | 10,000 | |||||
Lease expiration, description | Expiring in 2024. | |||||
Maryland [Member ] | ||||||
Area of land | 180,000 | |||||
Maryland [Member ] | Operating Lease Commitments [Member ] | ||||||
Area of land | 2,700 | |||||
Lease expiration, description | Expires in July 2020 with an option to renew for a two-year term. |
Commitments and Contingencies -
Commitments and Contingencies - Schedule of Components of Lease Expense (Details) | 6 Months Ended |
Jun. 30, 2019USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | |
Operating lease cost | $ 339,478 |
Finance lease cost, Amortization of right-of-use assets | 6,744 |
Finance lease cost, Interest on lease liabilities | 1,824 |
Total finance lease cost | $ 8,568 |
Commitments and Contingencies_3
Commitments and Contingencies - Schedule of Future Minimum Lease Payments Under All Non-cancelable Operating Leases (Details) | Jun. 30, 2019USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Operating Leases, 2019 | $ 230,744 |
Operating Leases, 2020 | 917,444 |
Operating Leases, 2021 | 1,008,227 |
Operating Leases, 2022 | 949,535 |
Operating Leases, 2023 | 910,166 |
Operating Leases, Thereafter | 5,139,851 |
Operating Leases, Total lease payments | 9,155,967 |
Less: Operating Leases, Imputed Interest | 2,845,742 |
Operating Leases | 6,310,224 |
Finance Lease, 2019 | 11,556 |
Finance Lease, 2020 | 23,112 |
Finance Lease, 2021 | 23,112 |
Finance Lease, 2022 | 11,823 |
Finance Lease, 2023 | 10,451 |
Finance Lease, Thereafter | 3,229 |
Finance Lease, Total lease payments | 83,282 |
Less: Finance Lease, imputed interest | (11,296) |
Finance Lease | $ 71,986 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 7 Months Ended | |||||||||
Aug. 09, 2019 | Jul. 31, 2019 | Jan. 31, 2019 | Dec. 31, 2018 | Nov. 30, 2018 | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Aug. 09, 2019 | Jul. 31, 2019 | May 30, 2019 | |
Billed amount | $ 25,672,676 | $ 2,937,325 | $ 29,188,492 | $ 5,020,275 | |||||||||
Payment for purchase of inventory | 16,700,000 | $ 3,300,000 | |||||||||||
Minimum [Member] | |||||||||||||
Warrants term | 3 years | 3 years | |||||||||||
Warrants exercise price | $ 0.30 | $ 0.30 | |||||||||||
Maximum [Member] | |||||||||||||
Warrants term | 5 years | 5 years | |||||||||||
Warrants exercise price | $ 2.25 | $ 2.25 | |||||||||||
Convertible Debentures [Member] | |||||||||||||
Accrued interest | $ 97,000 | $ 36,000 | $ 36,000 | $ 181,000 | $ 181,000 | ||||||||
Debt conversion of convertible shares | 233,194 | 524,360 | 524,360 | 923,185 | |||||||||
Debt conversion price per share | $ 3.04 | $ 2.23 | |||||||||||
Convertible Debentures [Member] | Minimum [Member] | |||||||||||||
Debt conversion price per share | $ 2.90 | $ 1.74 | $ 1.74 | ||||||||||
Convertible Debentures [Member] | Maximum [Member] | |||||||||||||
Debt conversion price per share | $ 3.06 | $ 1.74 | $ 1.74 | ||||||||||
Promissory Note [Member] | Minimum [Member] | |||||||||||||
Debt conversion price per share | 0.65 | ||||||||||||
Promissory Note [Member] | Maximum [Member] | |||||||||||||
Debt conversion price per share | $ 0.90 | ||||||||||||
Gen Canna [Member] | |||||||||||||
Billed amount, description | The seeds are to be harvested by October 2019, and accordingly the Company provided GenCanna with extended payment terms, allowing full payments to be made by December 2019. | ||||||||||||
Atalo Holdings Inc [Member] | |||||||||||||
Interest rate | 6.00% | ||||||||||||
Percentage for acquired interest rate | 25.00% | ||||||||||||
Subsequent Event [Member] | |||||||||||||
Payment for purchase of inventory | $ 5,000,000 | ||||||||||||
Subsequent Event [Member] | Three-Year Warrants [Member] | |||||||||||||
Warrants term | 3 years | 3 years | |||||||||||
Warrants to purchase common stock | 125,000 | 125,000 | |||||||||||
Warrants exercise price | $ 1.71 | $ 1.71 | |||||||||||
Subsequent Event [Member] | Employee [Member] | |||||||||||||
Options to purchase common stock | 100,000 | ||||||||||||
Options exercise price | $ 1.34 | $ 1.34 | |||||||||||
Options term | 5 years | ||||||||||||
Subsequent Event [Member] | Two Employees [Member] | |||||||||||||
Number of common stock issued during period | 18,820 | ||||||||||||
Subsequent Event [Member] | Convertible Debentures [Member] | 17.5M Debentures Holder [Member] | |||||||||||||
Debt converted into common shares, value | $ 2,750,000 | ||||||||||||
Accrued interest | $ 17,000 | $ 17,000 | |||||||||||
Debt conversion of convertible shares | 2,435,144 | ||||||||||||
Subsequent Event [Member] | Convertible Debentures [Member] | 17.5M Debentures Holder [Member] | Minimum [Member] | |||||||||||||
Debt conversion price per share | $ 1.08 | $ 1.08 | |||||||||||
Subsequent Event [Member] | Convertible Debentures [Member] | 17.5M Debentures Holder [Member] | Maximum [Member] | |||||||||||||
Debt conversion price per share | $ 1.70 | $ 1.70 | |||||||||||
Subsequent Event [Member] | Gen Canna [Member] | |||||||||||||
Billed amount | $ 8,000,000 | ||||||||||||
Payment for purchase of inventory | $ 5,000,000 | ||||||||||||
Billed amount, description | The seeds are to be harvested in the fall of 2019, and accordingly, the Company provided GenCanna with extended payment terms, with the full payment to be made in December 2019 after the crop is harvested. | ||||||||||||
Subsequent Event [Member] | Atalo Holdings Inc [Member] | Promissory Note [Member] | |||||||||||||
Convertible debentures | $ 230,000 | $ 230,000 | |||||||||||
Interest rate | 6.00% | 6.00% | |||||||||||
Percentage for acquired interest rate | 25.00% | 25.00% | |||||||||||
Subsequent Event [Member] | Atalo Holdings Inc [Member] | Promissory Note [Member] | |||||||||||||
Debt instrument maturity date | Apr. 3, 2020 |