Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2021 | May 13, 2021 | |
Cover [Abstract] | ||
Entity Registrant Name | IMAC Holdings, Inc. | |
Entity Central Index Key | 0001729944 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2021 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-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 | 25,200,481 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2021 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash | $ 15,607,712 | $ 2,623,952 |
Accounts receivable, net | 1,846,154 | 1,513,683 |
Deferred compensation, current portion | 330,364 | 309,375 |
Other assets | 514,772 | 310,359 |
Total current assets | 18,299,002 | 4,757,369 |
Property and equipment, net | 1,830,693 | 1,777,042 |
Other assets: | ||
Goodwill | 2,040,696 | 2,040,696 |
Intangible assets, net | 6,821,940 | 6,611,551 |
Deferred compensation, net of current portion | 287,562 | 354,906 |
Security deposits | 391,456 | 388,407 |
Right of use asset | 3,956,697 | 3,816,035 |
Total other assets | 13,498,351 | 13,211,595 |
Total assets | 33,628,046 | 19,746,006 |
Current liabilities: | ||
Accounts payable and accrued expenses | 2,018,883 | 1,692,283 |
Patient deposits | 413,854 | 295,071 |
Notes payable, current portion, net of deferred loan costs | 2,595,498 | 2,527,324 |
Finance lease obligation, current portion | 25,661 | 18,242 |
Liability to issue common stock, current portion | 364,575 | 339,375 |
Operating lease liability, current portion | 1,182,383 | 1,078,107 |
Total current liabilities | 6,600,854 | 5,950,402 |
Long-term liabilities: | ||
Notes payable, net of current portion | 180,212 | 1,958,883 |
Finance lease obligation, net of current portion | 43,637 | 48,323 |
Liability to issue common stock, net of current portion | 468,760 | 468,760 |
Operating lease liability, net of current portion | 3,501,876 | 3,506,484 |
Total liabilities | 10,795,339 | 11,932,852 |
Stockholders' equity: | ||
Preferred stock - $0.001 par value, 5,000,000 authorized, nil issued and outstanding at March 31, 2021 and December 31, 2020, respectively. | ||
Common stock - $0.001 par value, 30,000,000 authorized; 24,664,973 and 12,839,972 shares issued at March 31, 2021 and December 31, 2020, respectively; and 24,006,731 and 12,747,055 outstanding at March 31, 2021 and December 31, 2020, respectively. | 24,007 | 12,747 |
Additional paid-in capital | 42,702,810 | 25,465,094 |
Accumulated deficit | (17,035,818) | (15,045,783) |
Non-controlling interest | (2,858,292) | (2,618,904) |
Total stockholders' equity | 22,832,707 | 7,813,154 |
Total liabilities and stockholders' equity | $ 33,628,046 | $ 19,746,006 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Mar. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | ||
Preferred stock, shares outstanding | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 30,000,000 | 30,000,000 |
Common stock, shares issued | 24,664,973 | 12,839,972 |
Common stock, shares outstanding | 24,006,731 | 12,747,055 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Total revenue | $ 3,064,253 | $ 3,321,556 |
Operating expenses: | ||
Patient expenses | 341,412 | 379,817 |
Salaries and benefits | 2,754,248 | 2,926,150 |
Share-based compensation | 110,607 | 81,084 |
Advertising and marketing | 265,548 | 241,817 |
General and administrative | 1,219,338 | 1,236,138 |
Depreciation and amortization | 422,201 | 450,495 |
Total operating expenses | 5,113,354 | 5,315,501 |
Operating loss | (2,049,101) | (1,993,945) |
Other expenses: | ||
Gain/loss on disposition of assets | (4,043) | |
Interest expense | (176,279) | (76,204) |
Total other expenses | (180,322) | (76,204) |
Net loss before income taxes | (2,229,423) | (2,070,149) |
Income taxes | ||
Net loss | (2,229,423) | (2,070,149) |
Net loss attributable to the non-controlling interest | 239,388 | 336,604 |
Net loss attributable to IMAC Holdings, Inc. | $ (1,990,035) | $ (1,733,545) |
Net loss per share attributable to common stockholders Basic and diluted | $ (0.15) | $ (0.18) |
Weighted average common shares outstanding Basic and diluted | 13,448,567 | 9,611,252 |
Patient Revenues [Member] | ||
Total revenue | $ 3,024,808 | $ 3,309,069 |
Other Income [Member] | ||
Total revenue | 3,377 | |
Management Fees [Member] | ||
Total revenue | $ 36,068 | $ 12,487 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid-In-Capital [Member] | Non-Controlling Interest [Member] | Accumulated Deficit [Member] | Total |
Balance at Dec. 31, 2019 | $ 8,907 | $ 20,050,634 | $ (2,080,199) | $ (10,042,050) | $ 7,937,292 |
Balance, shares at Dec. 31, 2019 | 8,913,258 | ||||
Issuance of common stock | $ 1,096 | 1,376,122 | 1,377,218 | ||
Issuance of common stock, shares | 1,095,840 | ||||
Issuance of employee stock options | 38,359 | 38,359 | |||
Net loss | (336,604) | (1,733,545) | (2,070,149) | ||
Balance at Mar. 31, 2020 | $ 10,003 | 21,465,115 | (2,416,803) | (11,775,595) | 7,282,720 |
Balance, shares at Mar. 31, 2020 | 10,009,098 | ||||
Balance at Dec. 31, 2020 | $ 12,747 | 25,465,094 | (2,618,904) | (15,045,783) | 7,813,154 |
Balance, shares at Dec. 31, 2020 | 12,747,055 | ||||
Issuance of common stock | $ 11,260 | 17,198,664 | 17,209,924 | ||
Issuance of common stock, shares | 11,259,676 | ||||
Issuance of employee stock options | 39,052 | 39,052 | |||
Net loss | (239,388) | (1,990,035) | (2,229,423) | ||
Balance at Mar. 31, 2021 | $ 24,007 | $ 42,702,810 | $ (2,858,292) | $ (17,035,818) | $ 22,832,707 |
Balance, shares at Mar. 31, 2021 | 24,006,731 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash flows from operating activities: | ||
Net loss | $ (2,229,423) | $ (2,070,149) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 422,201 | 450,495 |
Share based compensation | 110,607 | 81,084 |
Loss on disposition of assets | 4,043 | |
(Increase) decrease in operating assets: | ||
Accounts receivable, net | (332,471) | (141,966) |
Other assets | (167,193) | 64,120 |
Security deposits | (3,049) | (51,796) |
Increase (decrease) in operating liabilities: | ||
Accounts payable and accrued expenses | 326,600 | 408,221 |
Patient deposits | 118,783 | 102,784 |
Net cash used in operating activities | (1,749,902) | (1,157,207) |
Cash flows from investing activities: | ||
Purchase of property and equipment | (65,769) | (7,243) |
Brand development | (55,045) | |
Acquisitions in Florida (Note 6) | (563,500) | (200,000) |
Proceeds from sale of fixed assets | 1,250 | |
Net cash used in investing activities | (683,064) | (207,243) |
Cash flows from financing activities: | ||
Proceeds from issuance of common stock | 17,209,924 | 1,403,837 |
Proceeds from notes payable | 1,200,000 | |
Payments on notes payable | (1,788,711) | (256,838) |
Payments of debt issuance costs | (70,000) | |
Payments on finance lease obligation | (4,487) | (4,298) |
Net cash provided by financing activities | 15,416,726 | 2,272,701 |
Net increase in cash | 12,983,760 | 908,251 |
Cash, beginning of period | 2,623,952 | 373,689 |
Cash, end of period | 15,607,712 | 1,281,940 |
Supplemental cash flow information: | ||
Interest paid | 63,359 | 27,412 |
Non cash financing and investing: | ||
Debt discount notes payable | $ 115,000 |
Description of Business
Description of Business | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Description of Business | Note 1 – Description of Business IMAC Holdings, Inc. is a holding company for IMAC Regeneration Centers, The Back Space retail store and our Investigational New Drug division. IMAC Holdings, Inc. and its affiliates (collectively, the “Company”) provide movement, orthopedic and neurological therapies through its chain of IMAC Regeneration Centers. Through its consolidated and equity owned entities, its outpatient medical clinics provide conservative, non-invasive medical treatments to help patients with back pain, knee pain, joint pain, ligament and tendon damage, and other related soft tissue conditions. The Company has opened or acquired through management service agreements sixteen (16) medical clinics located in Florida, Illinois, Kentucky, Missouri and Tennessee at March 31, 2021. The Company has partnered with several well-known sports stars such as Ozzie Smith, David Price, Tony Delk and Mike Ditka in opening its medical clinics, with a focus on delivering sports medicine treatments without opioids. The Back Space operates a healthcare center specializing in chiropractic and spinal care services inside our Fortune 500 partner’s retail locations. The Company’s Investigational New Drug division is conducting a clinical trial for its investigational compound utilizing umbilical cord-derived allogenic mesenchymal stem cells for the treatment of bradykinesia due to Parkinson’s disease. Effective June 1, 2018, the Company converted from IMAC Holdings, LLC a Kentucky limited liability company to IMAC Holdings, Inc. a Delaware corporation, followed by a reverse stock split in February 2019. These accounting changes have been given retrospective treatment in the condensed consolidated financial statements. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 2 – Summary of Significant Accounting Policies Principles of Consolidation The accompanying condensed consolidated financial statements have been prepared in accordance with Generally Accepted Accounting Principles (“GAAP”) in the United States of America (“U.S.”) as promulgated by the Financial Accounting Standards Board (“FASB”), Accounting Standards Codification (“ASC”) and with the rules and regulations of the U.S. Securities and Exchange Commission (“SEC” or the “Commission”). The information contained in these condensed consolidated financial statements should be read in conjunction with the Company’s consolidated financial statements and notes thereto for the fiscal year ended December 31, 2020 included in the Company’s Annual Report on Form 10-K filed with the SEC on March 4, 2021. The accompanying condensed consolidated financial statements include the accounts of IMAC Holdings, Inc. (“IMAC Holdings”) and the following entities which are consolidated due to direct ownership of a controlling voting interest or other rights granted to us as the sole general partner or managing member of the entity: IMAC Regeneration Center of St. Louis, LLC (“IMAC St. Louis”), IMAC Management Services, LLC (“IMAC Management”), IMAC Regeneration Management, LLC (“IMAC Texas”), IMAC Regeneration Management of Nashville, LLC (“IMAC Nashville”), IMAC Management of Illinois, LLC (“IMAC Illinois”), Advantage Hand Therapy and Orthopedic Rehabilitation, LLC (“Advantage Therapy”), IMAC Management of Florida, LLC (“IMAC Florida”), Chiropractic Health of Southwest Florida, Inc. (“SW Florida”) and The Back Space LLC (“Back Space”); the following entity which is consolidated with IMAC Regeneration Management of Nashville, LLC due to control by contract: IMAC Regeneration Center of Nashville, PC (“IMAC Nashville PC”); the following entities which are consolidated with IMAC Management of Illinois, LLC due to control by contract: Progressive Health and Rehabilitation, Ltd, Illinois Spine and Disc Institute, Ltd and Ricardo Knight, P.C.; the following entity which is consolidated with IMAC Management Services, LLC due to control by contract: Integrated Medicine and Chiropractic Regeneration Center PSC (“Kentucky PC”); the following entities which are consolidated with IMAC Management of Florida, LLC due to control by contract: Willmitch Chiropractic, P.A. and IMAC Medical of Florida, PA (“Florida Medical”) and the following entity which is consolidated with The Back Space LLC due to control by contract: The Back Space. In January 2020, the Company consummated an agreement for the acquisition of Chiropractic Health of Southwest Florida, Inc. (“CHSF”) in Bonita Springs, Florida. This entity is included in the condensed consolidated financial statements from the date of acquisition. In February 2021, the Company completed the asset purchase of and signed a Management Services Agreement with Willmitch Chiropractic, P.A. in Tampa, Florida. This entity is included in the condensed consolidated financial statements from the date of acquisition. In March 2021, the Company completed the asset purchase of NHC Chiropractic, PLLC dba Synergy Healthcare in Orlando, Florida. The assets acquired are included in the condensed consolidated financial statements from the date of acquisition. All significant intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses at the date and for the periods that the condensed consolidated financial statements are prepared. On an ongoing basis, the Company evaluates its estimates, including those related to insurance adjustments and provisions for doubtful accounts. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results could materially differ from those estimates. COVID-19 Pandemic On January 30, 2020, the World Health Organization (WHO) announced a global health emergency because of a new strain of coronavirus originating in Wuhan, China (the “COVID-19 outbreak”) and the risks to the international community as the virus spread globally beyond the point of origin. On March 20, 2020 the WHO classified the COVID-19 outbreak as a pandemic, based on the rapid increase in exposure globally. The full impact of the COVID-19 outbreak continues to evolve as of the date of these condensed consolidated financial statements. As such, it is uncertain as to the full magnitude that the pandemic will have on the Company’s combined financial condition, liquidity and future results of operations. Management is actively monitoring the impact of the global situation on its consolidated financial condition, liquidity, operations, suppliers, industry and workforce. Given the daily evolution of the COVID-19 outbreak and the global responses to curb its spread, the Company is not able to estimate the effects of the COVID-19 outbreak on its results of operations, financial condition, or liquidity for fiscal year 2020 beyond the results presented in these condensed consolidated financial statements and this quarterly report. Revenue Recognition The Company’s patient service revenue is derived from non-surgical procedures performed at our outpatient medical clinics. The fees for such services are billed either to the patient or a third-party payer, including Medicare. The Company recognizes service revenues based upon the estimated amounts the Company expects to be entitled to receive from patients and third-party payers. Estimates of contractual adjustments are based upon the payment terms specified in the related contractual agreements. The Company also records estimated implicit price concessions (based primarily on historical collection experience) related to uninsured accounts to record these revenues at the estimated amounts expected to be collected. Starting in January 2020, the Company implemented wellness maintenance programs on a subscription basis. There are three membership plans offered with different levels of service for each plan. The Company recognizes membership revenue on a pro-rated monthly basis. Enrollment in the wellness maintenance program can occur at any time during the month and can be dis-enrolled at any time. Other management service fees are derived from management services where the Company provides billings and collections support to the clinics and where management services are provided based on state specific regulations known as the corporate practice of medicine (“CPM”). Under the CPM, a business corporation is precluded from practicing medicine or employing a physician to provide professional medical services. In these circumstances, the Company provides all administrative support to the physician-owned PC through an LLC. The PC is consolidated due to control by contract (an “MSA” – Management Services Agreement). The fees we derive from these management arrangements are either based on a predetermined percentage of the revenue of each clinic or a percentage mark up on the costs of the LLC. The company recognize other management service revenue in the period in which services are rendered. These revenues are earned by IMAC Nashville, IMAC Management and IMAC Illinois and are eliminated in consolidation to the extent owned. The Company’s net patient revenue consisted of the following for the three months ended March 31, 2021 and 2020: Three Months Ended March 31, 2021 March 31, 2020 Patient revenue, net $ 3,024,808 $ 3,309,069 Patient Deposits Patient deposits are derived from patient payments in advance of services delivered. Our service lines include traditional and regenerative medicine. Regenerative medicine procedures are rarely paid by insurance carriers; therefore, the Company typically requires up-front payment from the patient for regenerative services and any co-pays and deductibles as required by the patient specific insurance carrier. For some patients, credit is provided through an outside vendor. In this case, the Company is paid from the credit card company and the risk is transferred to the credit card company for collection from the patient. These funds are accounted for as patient deposits until the procedures are performed at which point the patient deposit is recognized as patient service revenue. Fair Value of Financial Instruments The carrying amount of accounts receivable and accounts payable approximate their respective fair values due to the short- term nature. The carrying amount of the line of credit and note payable approximates fair values due to their market interest rates. Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents and accounts receivable. Cash and Cash Equivalents The Company considers all short-term investments with an original maturity of three months or less to be cash equivalents. The Company had no cash equivalents at March 31, 2021 and December 31, 2020. Accounts Receivable Accounts receivable primarily consists of amounts due from third-party payers (non-governmental), governmental payers and private pay patients and is recorded net of allowances for doubtful accounts and contractual discounts. The Company’s ability to collect outstanding receivables is critical to its results of operations and cash flows. Accordingly, accounts receivable reported in the Company’s condensed consolidated financial statements is recorded at the net amount expected to be received. The Company’s primary collection risks are (i) the risk of overestimation of net revenues at the time of billing that may result in the Company receiving less than the recorded receivable, (ii) the risk of non-payment as a result of commercial insurance companies’ denial of claims, (iii) the risk that patients will fail to remit insurance payments to the Company when the commercial insurance company pays out-of-network claims directly to the patient, (iv) resource and capacity constraints that may prevent the Company from handling the volume of billing and collection issues in a timely manner, (v) the risk that patients do not pay the Company for their self-pay balances (including co-pays, deductibles and any portion of the claim not covered by insurance) and (vi) the risk of non-payment from uninsured patients. The Company’s accounts receivable from third-party payers are recorded net of estimated contractual adjustments and allowances from third-party payers, which are estimated based on the historical trend of the Company’s facilities’ cash collections and contractual write-offs, accounts receivable aging, established fee schedules, relationships with payers and procedure statistics. While changes in estimated reimbursement from third-party payers remain a possibility, the Company expects that any such changes would be minimal and, therefore, would not have a material effect on the Company’s financial condition or results of operations. The Company’s collection policies and procedures are based on the type of payor, size of claim and estimated collection percentage for each patient account. The Company analyzes accounts receivable at each of the facilities to ensure the proper collection and aged category. The operating systems generate reports that assist in the collection efforts by prioritizing patient accounts. Collection efforts include direct contact with insurance carriers or patients and written correspondence. Allowance for Doubtful Accounts, Contractual and Other Discounts Management estimates the allowance for contractual and other discounts based on its historical collection experience and contracted relationship with the payers. The services authorized and provided and related reimbursement are often subject to interpretation and negotiation that could result in payments that differ from the Company’s estimates. The Company’s allowance for doubtful accounts is based on historical experience, but management also takes into consideration the age of accounts, creditworthiness and current economic trends when evaluating the adequacy of the allowance for doubtful accounts. An account may be written-off only after the Company has pursued collection efforts or otherwise determines an account to be uncollectible. Uncollectible balances are written-off against the allowance. Recoveries of previously written-off balances are credited to income when the recoveries are made. Property and Equipment Property and equipment are stated at cost, less accumulated depreciation. Additions and improvements to property and equipment are capitalized at cost. Depreciation of owned assets and amortization of leasehold improvements are computed using the straight-line method over the shorter of the estimated useful lives of the related assets or the lease term. The cost of assets sold or retired, and the related accumulated depreciation are removed from the accounts and any resulting gains or losses are reflected in other income (expense) for the year. Expenditures for maintenance and repairs are charged to expense as incurred. Intangible Assets The Company capitalizes the fair value of intangible assets acquired in business combinations. Intangible assets are amortized on a straight-line basis over their estimated economic useful lives, generally the contract term. The Company performs valuations of assets acquired and liabilities assumed on each acquisition accounted for as a business combination and allocates the purchase price of each acquired business to its respective net tangible and intangible assets. Acquired intangible assets include trade names, non-compete agreements, customer relationships and contractual agreements. Goodwill Our goodwill represents the excess of the purchase price over the fair value of the net identifiable assets acquired in business combinations. The goodwill generated from the business combinations is primarily related to the value placed on the employee workforce and expected synergies. Judgment is involved in determining if an indicator or change in circumstances relating to impairment has occurred. Such changes may include, among others, a significant decline in expected future cash flows, a significant adverse change in the business climate, and unforeseen competition. There was no goodwill impairment for the years presented. The Company tests goodwill for impairment on an annual basis, and when events or circumstances indicate the fair value of a reporting unit may be below its carrying value. Long-Lived Assets Long-lived assets such as property and equipment and intangible assets are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. There were no impairments of long-lived assets for the years presented. Advertising and Marketing The Company uses advertising and marketing to promote its services. Advertising and marketing costs are expensed as incurred. Advertising and marketing expense was $265,548 and $241,817 for the three months ended March 31, 2021 and 2020, respectively. Net Loss Per Share Basic net loss per common share is computed by dividing net loss applicable to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted net loss per common share is determined using the weighted-average of common shares outstanding during the period, adjusted for the dilutive effect of common stock equivalents, consisting of the conversion option embedded in convertible debt. The weighted-average number of common shares outstanding excludes common stock equivalents because their inclusion would have an anti-dilutive effect. Income Taxes IMAC Holdings was taxed as a partnership through May 31, 2018. As a result, income tax liabilities were passed through to the individual members. Accordingly, no provision for income taxes were reflected in the consolidated financial statements for periods prior to May 31, 2018, at which time the Company converted from a limited liability company to a Delaware corporation. Subsequent to the Company converting to a Delaware corporation, IMAC Nashville, IMAC Texas, IMAC St. Louis continued as single-member limited liability companies that are disregarded entities for tax purposes and do not file separate returns. Their activity is included as part of IMAC Holdings Inc. Advantage Therapy, IMAC Illinois, IMAC Florida, Back Space and BioFirma are also disregarded entities for tax purposes. IMAC Management is a C-corporation and is included in the consolidated return of IMAC Holdings as a subsidiary. Any future benefit arising from losses have been offset by a valuation allowance. Accordingly, no provision for income taxes is reflected in the condensed consolidated financial statements. The Company records a liability for uncertain tax positions when it is probable that a loss has been incurred and the amount can be reasonably estimated. Interest and penalties related to income tax matters, if any, would be recognized as a component of income tax expense. At March 31, 2021 and December 31, 2020, the Company had no liabilities for uncertain tax positions. The Company continually evaluates expiring statutes of limitations, audits, proposed settlements, changes in tax law and new authoritative rulings. Currently, the tax years subsequent to 2017 are open and subject to examination by the taxing authorities. |
Capital Requirements, Liquidity
Capital Requirements, Liquidity and Going Concern Considerations | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Capital Requirements, Liquidity and Going Concern Considerations | Note 3 – Capital Requirements, Liquidity and Going Concern Considerations The Company had working capital of approximately $11.7 million and a deficiency in working capital of $1.2 million at March 31, 2021 and December 31, 2020, respectively. The Company had a net loss of approximately $2.0 million for the three months ended March 31, 2021, and used cash in operations of approximately $1.7 million at March 31, 2021. The Company expects to continue to incur significant expenditures to develop and expand its owned and managed outpatient medical clinics. Management recognizes that the Company must obtain additional resources to successfully integrate its acquired and managed clinics and implement its business plans. Prior to the Company’s March 2021 public offering, the Company funded its business plan through debt and equity securities. Management expects to continue to incur net losses and have significant cash outflows for at least the next 12 months. During the quarter ended March 31, 2021, the Company completed a public offering and received proceeds of approximately $17 million. Subsequent to March 31, 2021, the Company sold an additional 1,193,750 shares for proceeds of $1.9 million. These events served to mitigate the conditions that historically raised substantial doubt about the Company’s ability to continue as a going concern. Based on this analysis, the Company has the ability to continue as a going concern for at least the next 12 months and meet its financial obligations as they become due. |
Concentration of Credit Risks
Concentration of Credit Risks | 3 Months Ended |
Mar. 31, 2021 | |
Risks and Uncertainties [Abstract] | |
Concentration of Credit Risks | Note 4 – Concentration of Credit Risks Cash The Company maintains its cash in accounts at financial institutions, which may, at times, exceed federally-insured limits of $250,000. Revenue and Accounts Receivable As of March 31, 2021 and December 31, 2020, the Company had the following revenue and accounts receivable concentrations: March 31, 2021 December 31, 2020 % of Revenue % of Accounts Receivable % of Revenue % of Accounts Receivable (Unaudited) Patient payment 37 % 33 % 35 % 38 % Medicare payment 40 % 15 % 40 % 16 % Insurance payment 23 % 52 % 25 % 46 % |
Accounts Receivable
Accounts Receivable | 3 Months Ended |
Mar. 31, 2021 | |
Receivables [Abstract] | |
Accounts Receivable | Note 5 – Accounts Receivable As of March 31, 2021 and December 31, 2020, the Company’s accounts receivable consisted of the following: March 31, 2021 December 31, 2020 (Unaudited) Gross accounts receivable $ 1,875,136 $ 1,542,665 Less: allowance for doubtful accounts (28,982 ) (28,982 ) Accounts receivable, net $ 1,846,154 $ 1,513,683 |
Business Acquisitions
Business Acquisitions | 3 Months Ended |
Mar. 31, 2021 | |
Business Combinations [Abstract] | |
Business Acquisitions | Note 6 – Business Acquisitions IMAC Florida In February 2021, the Company completed the asset purchase of and signed Management Services Agreement with Willmitch Chiropractic, P.A. in Tampa, Florida. The transaction was completed as an asset purchase for $421,000. Willmitch Chiropractic’s founder, Martin Willmitch, will remain with the Company and serve as Vice President of Managed Care of IMAC. In March 2021, the Company completed the asset purchase of NHC Chiropractic, PLLC dba Synergy Healthcare in Orlando, Florida. The transaction was completed as an asset purchase for $142,500. The following table summarizes the fair value of consideration paid and the allocation of purchase price to the fair value of net assets acquired for the acquisition of the IMAC Florida businesses: Orlando Tampa Property & equipment $ 149,720 $ 7,400 Customer lists - 413,600 Current liabilities (7,220 ) - $ 142,500 $ 421,000 |
Property and Equipment
Property and Equipment | 3 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Note 7 – Property and Equipment The Company’s property and equipment consisted of the following at March 31, 2021 and December 31, 2020: Estimated Useful Life in Years March 31, 2021 December 31, 2020 Leasehold improvements Shorter of asset or lease term $ 2,070,041 $ 2,064,669 Equipment 1.5 - 7 2,190,266 2,012,276 Total property and equipment 4,260,307 4,076,945 Less: accumulated depreciation (2,454,187 ) (2,302,273 ) 1,806,120 1,774,672 Construction in progress 24,573 2,370 Total property and equipment, net $ 1,830,693 $ 1,777,042 Depreciation was $163,945 and $218,843 for the three months ended March 31, 2021 and 2020, respectively. |
Intangibles Assets and Goodwill
Intangibles Assets and Goodwill | 3 Months Ended |
Mar. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangibles Assets and Goodwill | Note 8 – Intangibles Assets and Goodwill The Company’s intangible assets and goodwill consisted of the following at March 31, 2021 and December 31, 2020: March 31, 2021 Estimated Accumulated Useful Life Cost Amortization Net Intangible assets: Management service agreements 10 years $ 7,940,398 $ (1,904,888 ) $ 6,035,510 Non-compete agreements 3 years 301,000 (282,223 ) 18,777 Customer lists 3 years 548,482 (79,179 ) 469,303 Brand development 10 years 55,045 (445 ) 54,600 Definite lived assets 8,844,925 (2,266,735 ) 6,578,190 Research and development 243,750 - 243,750 Goodwill 2,040,696 - 2,040,696 Total intangible assets and goodwill $ 11,129,371 $ (2,266,735 ) $ 8,862,636 December 31, 2020 Estimated Accumulated Useful Life Cost Amortization Net Intangible assets: Management service agreements 10 years $ 7,940,398 $ (1,706,379 ) $ 6,234,019 Non-compete agreements 3 years 301,000 (257,139 ) 43,861 Customer lists 3 years 134,882 (44,961 ) 89,921 Definite lived assets 8,376,280 (2,008,479 ) 6,367,801 Research and development 243,750 - 243,750 Goodwill 2,040,696 - 2,040,696 Total intangible assets and goodwill $ 10,660,726 $ (2,008,479 ) $ 8,652,247 Amortization was $258,256 and $231,652 for the three months ended March 31, 2021 and 2020, respectively. The Company’s estimated future amortization of intangible assets was as follows: Years Ending December 31, 2021 (nine months) $ 754,180 2022 980,537 2023 935,576 2024 809,198 2025 797,709 Thereafter 2,300,990 $ 6,578,190 |
Operating Leases
Operating Leases | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Operating Leases | Note 9 – Operating Leases On January 1, 2019, the Company adopted ASC 842 using the modified retrospective method applied to leases that were in place at January 1, 2019. Results for operating periods beginning after January 1, 2019 are presented under ASC 842, while prior period amounts are not adjusted and continue to be reported in accordance with our historic accounting under ASC 840. The Company’s leases consist of operating leases that mostly relate to real estate rental agreements. Most of the value of the Company’s lease portfolio relates to real estate lease agreements that were entered into starting March 2017. Discount Rate Applied to Operating Leases To determine the present value of minimum future lease payments for operating leases at January 1, 2019, the Company was required to estimate a rate of interest that we would have to pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment (the “incremental borrowing rate” or “IBR”). The Company determined the appropriate IBR by identifying a reference rate and making adjustments that take into consideration financing options and certain lease-specific circumstances. For the reference rate, the Company used the ten year mortgage interest rate. Right of Use Assets Right of use assets included in the Company’s condensed consolidated balance sheet were as follows: March 31, 2021 December 31, 2020 Non-current assets Right of use assets, net of amortization $ 3,956,697 $ 3,816,035 Total operating lease cost Individual components of the total lease cost incurred by the Company were as follows: Three Months Ended March 31, 2021 Three Months Ended March 31, 2020 Operating lease expense $ 293,793 $ 306,632 Minimum rental payments under operating leases are recognized on a straight light basis over the term of the lease. Maturity of operating leases The Company’s amount of future minimum lease payments under operating leases are as follows: Operating Leases Undiscounted future minimum lease payments: 2021 (nine months) $ 967,531 2022 1,290,317 2023 1,184,577 2024 784,988 2025 430,482 Thereafter 303,790 Total 4,961,685 Amount representing imputed interest (277,426 ) Total operating lease liability 4,684,259 Current portion of operating lease liability (1,182,383 ) Operating lease liability, non-current $ 3,501,876 |
Notes Payable
Notes Payable | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Notes Payable | Note 10 – Notes Payable Set forth below is a summary of the Company’s outstanding debt as of March 31, 2021 and December 31, 2020: March 31, December 31, 2021 2020 Note payable to Edward S. Bredniak in the amount of up to $2,000,000. An existing note payable with this entity in the amount of $379,676 has been combined into the new note payable which carries an interest rate of 10% per annum. This note was amended in September 2020 and all outstanding balances are due January 5, 2022. $ - $ 1,750,000 Note payable to a financial institution in the amount of $200,000 dated November 15, 2017. The note requires 66 consecutive monthly installments of $2,652 including principal and interest at 5%, with a balloon payment of $60,000 which was paid on June 15, 2018. The note matures on May 15, 2023, and is secured by the personal guarantees of certain Company executives. 65,157 72,238 Note payable to a financial institution in the amount of $131,400 dated August 1, 2016. The note requires 120 monthly installments of $1,394 including principal and interest at 5%. The note matures on July 1, 2026, and is secured by a letter of credit. 78,152 81,330 Note payable to a financial institution in the amount of $200,000 dated May 4, 2016. The note requires 60 monthly installments of $3,881 including principal and interest at 4.25%. The note matures on May 4, 2021, and is secured by the equipment and personal guarantees of certain Company executives. 7,711 19,191 Note payable to an employee in the amount of $101,906 dated March 8, 2017. The note requires payments in five annual installments of $23,350, including principal and interest at 5%. The note matures on December 31, 2021, and is unsecured. 20,000 20,000 $112,800 payable to a landlord of Advantage Therapy, LLC pursuant to a lease dated March 1, 2019. The debt is payable in 60 monthly installments of $2,129, including principal and interest at 5%. The debt matures on June 1, 2024. 76,478 81,862 Note payable to a financial institution in the amount of $140,000, dated September 25, 2019. The note requires 36 consecutive monthly installments of $4,225 including principal and interest at 5.39%. The note matures on September 19, 2022 and is secured by a personal guarantee of the Vice President of Business Development of the Company. 72,855 84,444 Note payable in the amount of $2,690,000, dated October 29, 2020. The note is payable on or before April 29, 2022. The interest on the note accrues at a rate of 7% per annum and is payable on the maturity date or otherwise in accordance with the note. 2,690,000 2,690,000 Unamortized debt issuance costs (234,643 ) (312,858 ) 2,775,710 4,486,207 Less: current portion: (2,595,498 ) (2,527,324 ) $ 180,212 $ 1,958,883 Principal maturities of the Company’s notes payable are as follows: Years Ending December 31, Amount 2021 (nine months) $ 2,566,827 2022 104,186 2023 51,657 2024 27,631 2025 15,813 Thereafter 9,596 Total $ 2,775,710 |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Stockholders' Equity | Note 11 – Stockholders’ Equity On June 18, 2020, the Company entered into a securities purchase agreement (the “Securities Purchase Agreement”) with institutional accredited investors (the “Purchasers”) pursuant to which the Company offered for sale to the Purchasers an aggregate of 1,764,000 shares (the “Shares”) of its common stock, in a registered direct offering (the “Registered Direct Offering”). The Shares were offered by the Company pursuant to its shelf registration statement on Form S-3 (File No. 333-237455) originally filed with the SEC on March 27, 2020 (as amended, the “Registration Statement”), which was declared effective on April 3, 2020. The purchase price for one Share in the Registered Direct Offering was $1.50, and closing of the Registered Direct Offering occurred on June 22, 2020. The Company received $2.644 million in gross proceeds from the Registered Direct Offering. The Company used approximately $0.5 million of the gross proceeds for the repayment of certain indebtedness, and the remaining proceeds to the Company will be used to finance the costs of developing and acquiring additional outpatient medical clinics as part of the Company’s growth and expansion strategy and for working capital. On October 5, 2020, the Company launched an at-the-market offering of up to $5,000,000 worth of shares of the Company’s common stock pursuant to an At-The-Market Issuance Sales Agreement, dated October 5, 2020, by and between the Company and Ascendiant Capital Markets, LLC. Since the launch and as of March 31, 2021, pursuant to the Agreement, the Company had sold 1,541,758 shares of common stock through Ascendiant Capital Markets for aggregate proceeds to the Company of $2.9 million. During March 2021, the Company completed a public offering by issuing 10,625,000 shares of common stock for gross proceeds of $17 million. The Company used approximately $1.8 million for the repayment of certain indebtedness and is using the remaining proceeds for the repayment of certain other indebtedness, to finance the costs of developing and acquiring additional outpatient medical clinics and healthcare centers as part of the Company’s growth and expansion strategy and for working capital. 2018 Incentive Compensation Plan The Company’s board of directors and holders of a majority of outstanding shares approved and adopted the Company’s 2018 Incentive Compensation Plan (“2018 Plan”) in May 2018, reserving the issuance of up to 1,000,000 shares of common stock (subject to certain adjustments) upon exercise of stock options and grants of other equity awards. The 2018 Plan provides for the grant of incentive stock options (“ISOs”), nonstatutory stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance-based stock awards, other forms of equity compensation and performance cash awards. ISOs may be granted only to employees. All other awards may be granted to employees, including officers, and to the Company’s non-employee directors and consultants, and affiliates. Stock Options As of March 31, 2021, the Company had issued stock options to purchase 435,518 shares of its common stock as non-qualified stock options to various employees of the Company. These options vest over a period of four years, with 25% vesting after one year and the remaining 75% vesting in equal monthly installments over the following 36 months and are exercisable for a period of ten years. Stock based compensation for stock options is estimated at the grant date based on the fair value calculated using the Black-Scholes method. The per-share fair values of these options is calculated based on the Black-Scholes-Merton pricing model with the following assumptions: a volatility rate of 32.2%, risk free rate of 2.4% and the expected term of 10 years. Restricted Stock Units On May 21, 2019, the Company granted an aggregate of 277,500 Restricted Stock Units (“RSUs”) to certain employees, executives and directors of the Company, the terms of which vest over various periods between the date of grant and May 21, 2023. On August 13, 2019, 30,000 shares of common stock were issued pursuant to previously granted RSUs which had vested as of such date. On May 21, 2020, the Company granted 10,000 RSUs to a Board member that vested immediately. On October 20, 2020, the Company granted an aggregate of 300,000 RSUs to Board members with these RSUs vesting in eight equal quarterly installments commencing on February 1, 2021, provided the Board members remain directors of the Company. On January 30, 2021, the Company granted an aggregate of 15,000 RSUs to non-executive staff and contractors with these RSUs vesting after one year. |
Retirement Plan
Retirement Plan | 3 Months Ended |
Mar. 31, 2021 | |
Retirement Benefits [Abstract] | |
Retirement Plan | Note 12 – Retirement Plan The Company offers a 401(k) plan that covers eligible employees. The plan provides for voluntary salary deferrals for eligible employees. Additionally, the Company is required to make matching contributions of 50% of up to 6 % of total compensation for those employees making salary deferrals. The Company made contributions of $34,074 and $19,690 during the three months ended March 31, 2021 and 2020, respectively. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 13 – Income Taxes The provision for income taxes differs from the amount computed by applying the statutory federal income tax rate to income before provision for income taxes. The sources and tax effects of the differences are as follows: Deferred tax benefit at the federal statutory rate 21 % Valuation allowance -21 % 0 % At March 31, 2021, the Company had a net operating loss carryforward of approximately $11.4 million for federal and state purposes. This loss will be available to offset future taxable income. There is no expiration of this carryforward as it was generated after December 31, 2017. The deferred tax asset relating to the operating loss carryforward has been fully reserved. The principal differences between the operating loss for income tax purposes and reporting purposes are shares issued for services and share-based compensation and a temporary difference in depreciation expense. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 14 – Commitments and Contingencies The Company is subject to extensive regulation, including health insurance regulations directed at ascertaining the appropriateness of reimbursement, preventing fraud and abuse and otherwise regulating reimbursement. To ensure compliance, various insurance providers often conduct audits and request patient records and other documents to support claims submitted by the Company for payment of services rendered to customers. In the event that an audit results in discrepancies in the records provided, insurance providers may be entitled to extrapolate the results of the audit to make overpayment demands based on a wider population of claims than those examined in the audit. From time to time the Company may become subject to threatened and/or asserted claims arising in the ordinary course of our business. Management is not aware of any matters, either individually or in the aggregate, that are reasonably likely to have a material impact on the Company’s financial condition, results of operations or liquidity. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 15 - Subsequent Events On April 7, 2021 the Company closed on the sale of an additional 1,193,750 shares of common stock at the recent public offering price of $1.60 per share, pursuant to the 15% over-allotment option exercised in full by the underwriters in connection with its public offering that closed March 26, 2021. These proceeds will be used to fund working capital and general corporate purposes. The Company accrues a liability and charges operations for the estimated costs of contingent liabilities, including adjudication or settlement of various asserted and unasserted claims existing as of the balance sheet date, where there is a reasonable possibility that a loss has been incurred and the loss (or range of probable loss) is estimable. The Company currently is party to certain actions, described below arising from the normal course of business: On April 15, 2021, the Company received notification from Covent Bridge Group, a Center for Medicare & Medicaid Services (“CMS”) contractor, that they are recommending to CMS that the Company was overpaid in the amount of $2,921,868. This amount represents a statistical extrapolation of $11,530 of charges from a sample of 40 claims for the periods February 2017 to November 2020. As of the filing date, the Company has not received a request for payment from CMS. The Company has begun its own internal audit process and disagrees with the interpretation of the medical records and the extrapolation techniques used to derive this balance. The Company is prepared to follow the appropriate appeals process or use the judicial system. The Company is unable to predict the timing and ultimate outcome of this matter and therefore is unable to estimate the range of possible loss. Any potential loss may be classified as errors and omissions for which insurance coverage was in place during a majority of the years being evaluated. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The accompanying condensed consolidated financial statements have been prepared in accordance with Generally Accepted Accounting Principles (“GAAP”) in the United States of America (“U.S.”) as promulgated by the Financial Accounting Standards Board (“FASB”), Accounting Standards Codification (“ASC”) and with the rules and regulations of the U.S. Securities and Exchange Commission (“SEC” or the “Commission”). The information contained in these condensed consolidated financial statements should be read in conjunction with the Company’s consolidated financial statements and notes thereto for the fiscal year ended December 31, 2020 included in the Company’s Annual Report on Form 10-K filed with the SEC on March 4, 2021. The accompanying condensed consolidated financial statements include the accounts of IMAC Holdings, Inc. (“IMAC Holdings”) and the following entities which are consolidated due to direct ownership of a controlling voting interest or other rights granted to us as the sole general partner or managing member of the entity: IMAC Regeneration Center of St. Louis, LLC (“IMAC St. Louis”), IMAC Management Services, LLC (“IMAC Management”), IMAC Regeneration Management, LLC (“IMAC Texas”), IMAC Regeneration Management of Nashville, LLC (“IMAC Nashville”), IMAC Management of Illinois, LLC (“IMAC Illinois”), Advantage Hand Therapy and Orthopedic Rehabilitation, LLC (“Advantage Therapy”), IMAC Management of Florida, LLC (“IMAC Florida”), Chiropractic Health of Southwest Florida, Inc. (“SW Florida”) and The Back Space LLC (“Back Space”); the following entity which is consolidated with IMAC Regeneration Management of Nashville, LLC due to control by contract: IMAC Regeneration Center of Nashville, PC (“IMAC Nashville PC”); the following entities which are consolidated with IMAC Management of Illinois, LLC due to control by contract: Progressive Health and Rehabilitation, Ltd, Illinois Spine and Disc Institute, Ltd and Ricardo Knight, P.C.; the following entity which is consolidated with IMAC Management Services, LLC due to control by contract: Integrated Medicine and Chiropractic Regeneration Center PSC (“Kentucky PC”); the following entities which are consolidated with IMAC Management of Florida, LLC due to control by contract: Willmitch Chiropractic, P.A. and IMAC Medical of Florida, PA (“Florida Medical”) and the following entity which is consolidated with The Back Space LLC due to control by contract: The Back Space. In January 2020, the Company consummated an agreement for the acquisition of Chiropractic Health of Southwest Florida, Inc. (“CHSF”) in Bonita Springs, Florida. This entity is included in the condensed consolidated financial statements from the date of acquisition. In February 2021, the Company completed the asset purchase of and signed a Management Services Agreement with Willmitch Chiropractic, P.A. in Tampa, Florida. This entity is included in the condensed consolidated financial statements from the date of acquisition. In March 2021, the Company completed the asset purchase of NHC Chiropractic, PLLC dba Synergy Healthcare in Orlando, Florida. The assets acquired are included in the condensed consolidated financial statements from the date of acquisition. All significant intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses at the date and for the periods that the condensed consolidated financial statements are prepared. On an ongoing basis, the Company evaluates its estimates, including those related to insurance adjustments and provisions for doubtful accounts. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results could materially differ from those estimates. |
Covid-19 Pandemic | COVID-19 Pandemic On January 30, 2020, the World Health Organization (WHO) announced a global health emergency because of a new strain of coronavirus originating in Wuhan, China (the “COVID-19 outbreak”) and the risks to the international community as the virus spread globally beyond the point of origin. On March 20, 2020 the WHO classified the COVID-19 outbreak as a pandemic, based on the rapid increase in exposure globally. The full impact of the COVID-19 outbreak continues to evolve as of the date of these condensed consolidated financial statements. As such, it is uncertain as to the full magnitude that the pandemic will have on the Company’s combined financial condition, liquidity and future results of operations. Management is actively monitoring the impact of the global situation on its consolidated financial condition, liquidity, operations, suppliers, industry and workforce. Given the daily evolution of the COVID-19 outbreak and the global responses to curb its spread, the Company is not able to estimate the effects of the COVID-19 outbreak on its results of operations, financial condition, or liquidity for fiscal year 2020 beyond the results presented in these condensed consolidated financial statements and this quarterly report. |
Revenue Recognition | Revenue Recognition The Company’s patient service revenue is derived from non-surgical procedures performed at our outpatient medical clinics. The fees for such services are billed either to the patient or a third-party payer, including Medicare. The Company recognizes service revenues based upon the estimated amounts the Company expects to be entitled to receive from patients and third-party payers. Estimates of contractual adjustments are based upon the payment terms specified in the related contractual agreements. The Company also records estimated implicit price concessions (based primarily on historical collection experience) related to uninsured accounts to record these revenues at the estimated amounts expected to be collected. Starting in January 2020, the Company implemented wellness maintenance programs on a subscription basis. There are three membership plans offered with different levels of service for each plan. The Company recognizes membership revenue on a pro-rated monthly basis. Enrollment in the wellness maintenance program can occur at any time during the month and can be dis-enrolled at any time. Other management service fees are derived from management services where the Company provides billings and collections support to the clinics and where management services are provided based on state specific regulations known as the corporate practice of medicine (“CPM”). Under the CPM, a business corporation is precluded from practicing medicine or employing a physician to provide professional medical services. In these circumstances, the Company provides all administrative support to the physician-owned PC through an LLC. The PC is consolidated due to control by contract (an “MSA” – Management Services Agreement). The fees we derive from these management arrangements are either based on a predetermined percentage of the revenue of each clinic or a percentage mark up on the costs of the LLC. The company recognize other management service revenue in the period in which services are rendered. These revenues are earned by IMAC Nashville, IMAC Management and IMAC Illinois and are eliminated in consolidation to the extent owned. The Company’s net patient revenue consisted of the following for the three months ended March 31, 2021 and 2020: Three Months Ended March 31, 2021 March 31, 2020 Patient revenue, net $ 3,024,808 $ 3,309,069 |
Patient Deposits | Patient Deposits Patient deposits are derived from patient payments in advance of services delivered. Our service lines include traditional and regenerative medicine. Regenerative medicine procedures are rarely paid by insurance carriers; therefore, the Company typically requires up-front payment from the patient for regenerative services and any co-pays and deductibles as required by the patient specific insurance carrier. For some patients, credit is provided through an outside vendor. In this case, the Company is paid from the credit card company and the risk is transferred to the credit card company for collection from the patient. These funds are accounted for as patient deposits until the procedures are performed at which point the patient deposit is recognized as patient service revenue. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying amount of accounts receivable and accounts payable approximate their respective fair values due to the short- term nature. The carrying amount of the line of credit and note payable approximates fair values due to their market interest rates. Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents and accounts receivable. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all short-term investments with an original maturity of three months or less to be cash equivalents. The Company had no cash equivalents at March 31, 2021 and December 31, 2020. |
Accounts Receivable | Accounts Receivable Accounts receivable primarily consists of amounts due from third-party payers (non-governmental), governmental payers and private pay patients and is recorded net of allowances for doubtful accounts and contractual discounts. The Company’s ability to collect outstanding receivables is critical to its results of operations and cash flows. Accordingly, accounts receivable reported in the Company’s condensed consolidated financial statements is recorded at the net amount expected to be received. The Company’s primary collection risks are (i) the risk of overestimation of net revenues at the time of billing that may result in the Company receiving less than the recorded receivable, (ii) the risk of non-payment as a result of commercial insurance companies’ denial of claims, (iii) the risk that patients will fail to remit insurance payments to the Company when the commercial insurance company pays out-of-network claims directly to the patient, (iv) resource and capacity constraints that may prevent the Company from handling the volume of billing and collection issues in a timely manner, (v) the risk that patients do not pay the Company for their self-pay balances (including co-pays, deductibles and any portion of the claim not covered by insurance) and (vi) the risk of non-payment from uninsured patients. The Company’s accounts receivable from third-party payers are recorded net of estimated contractual adjustments and allowances from third-party payers, which are estimated based on the historical trend of the Company’s facilities’ cash collections and contractual write-offs, accounts receivable aging, established fee schedules, relationships with payers and procedure statistics. While changes in estimated reimbursement from third-party payers remain a possibility, the Company expects that any such changes would be minimal and, therefore, would not have a material effect on the Company’s financial condition or results of operations. The Company’s collection policies and procedures are based on the type of payor, size of claim and estimated collection percentage for each patient account. The Company analyzes accounts receivable at each of the facilities to ensure the proper collection and aged category. The operating systems generate reports that assist in the collection efforts by prioritizing patient accounts. Collection efforts include direct contact with insurance carriers or patients and written correspondence. |
Allowance for Doubtful Accounts, Contractual and Other Discounts | Allowance for Doubtful Accounts, Contractual and Other Discounts Management estimates the allowance for contractual and other discounts based on its historical collection experience and contracted relationship with the payers. The services authorized and provided and related reimbursement are often subject to interpretation and negotiation that could result in payments that differ from the Company’s estimates. The Company’s allowance for doubtful accounts is based on historical experience, but management also takes into consideration the age of accounts, creditworthiness and current economic trends when evaluating the adequacy of the allowance for doubtful accounts. An account may be written-off only after the Company has pursued collection efforts or otherwise determines an account to be uncollectible. Uncollectible balances are written-off against the allowance. Recoveries of previously written-off balances are credited to income when the recoveries are made. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost, less accumulated depreciation. Additions and improvements to property and equipment are capitalized at cost. Depreciation of owned assets and amortization of leasehold improvements are computed using the straight-line method over the shorter of the estimated useful lives of the related assets or the lease term. The cost of assets sold or retired, and the related accumulated depreciation are removed from the accounts and any resulting gains or losses are reflected in other income (expense) for the year. Expenditures for maintenance and repairs are charged to expense as incurred. |
Intangible Assets | Intangible Assets The Company capitalizes the fair value of intangible assets acquired in business combinations. Intangible assets are amortized on a straight-line basis over their estimated economic useful lives, generally the contract term. The Company performs valuations of assets acquired and liabilities assumed on each acquisition accounted for as a business combination and allocates the purchase price of each acquired business to its respective net tangible and intangible assets. Acquired intangible assets include trade names, non-compete agreements, customer relationships and contractual agreements. |
Goodwill | Goodwill Our goodwill represents the excess of the purchase price over the fair value of the net identifiable assets acquired in business combinations. The goodwill generated from the business combinations is primarily related to the value placed on the employee workforce and expected synergies. Judgment is involved in determining if an indicator or change in circumstances relating to impairment has occurred. Such changes may include, among others, a significant decline in expected future cash flows, a significant adverse change in the business climate, and unforeseen competition. There was no goodwill impairment for the years presented. The Company tests goodwill for impairment on an annual basis, and when events or circumstances indicate the fair value of a reporting unit may be below its carrying value. |
Long-lived Assets | Long-Lived Assets Long-lived assets such as property and equipment and intangible assets are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. There were no impairments of long-lived assets for the years presented. |
Advertising and Marketing | Advertising and Marketing The Company uses advertising and marketing to promote its services. Advertising and marketing costs are expensed as incurred. Advertising and marketing expense was $265,548 and $241,817 for the three months ended March 31, 2021 and 2020, respectively. |
Net Loss Per Share | Net Loss Per Share Basic net loss per common share is computed by dividing net loss applicable to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted net loss per common share is determined using the weighted-average of common shares outstanding during the period, adjusted for the dilutive effect of common stock equivalents, consisting of the conversion option embedded in convertible debt. The weighted-average number of common shares outstanding excludes common stock equivalents because their inclusion would have an anti-dilutive effect. |
Income Taxes | Income Taxes IMAC Holdings was taxed as a partnership through May 31, 2018. As a result, income tax liabilities were passed through to the individual members. Accordingly, no provision for income taxes were reflected in the consolidated financial statements for periods prior to May 31, 2018, at which time the Company converted from a limited liability company to a Delaware corporation. Subsequent to the Company converting to a Delaware corporation, IMAC Nashville, IMAC Texas, IMAC St. Louis continued as single-member limited liability companies that are disregarded entities for tax purposes and do not file separate returns. Their activity is included as part of IMAC Holdings Inc. Advantage Therapy, IMAC Illinois, IMAC Florida, Back Space and BioFirma are also disregarded entities for tax purposes. IMAC Management is a C-corporation and is included in the consolidated return of IMAC Holdings as a subsidiary. Any future benefit arising from losses have been offset by a valuation allowance. Accordingly, no provision for income taxes is reflected in the condensed consolidated financial statements. The Company records a liability for uncertain tax positions when it is probable that a loss has been incurred and the amount can be reasonably estimated. Interest and penalties related to income tax matters, if any, would be recognized as a component of income tax expense. At March 31, 2021 and December 31, 2020, the Company had no liabilities for uncertain tax positions. The Company continually evaluates expiring statutes of limitations, audits, proposed settlements, changes in tax law and new authoritative rulings. Currently, the tax years subsequent to 2017 are open and subject to examination by the taxing authorities. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Schedule of Patient Revenue, Net | The Company’s net patient revenue consisted of the following for the three months ended March 31, 2021 and 2020: Three Months Ended March 31, 2021 March 31, 2020 Patient revenue, net $ 3,024,808 $ 3,309,069 |
Concentration of Credit Risks (
Concentration of Credit Risks (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Risks and Uncertainties [Abstract] | |
Schedule of Concentration Risk | As of March 31, 2021 and December 31, 2020, the Company had the following revenue and accounts receivable concentrations: March 31, 2021 December 31, 2020 % of Revenue % of Accounts Receivable % of Revenue % of Accounts Receivable (Unaudited) Patient payment 37 % 33 % 35 % 38 % Medicare payment 40 % 15 % 40 % 16 % Insurance payment 23 % 52 % 25 % 46 % |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Receivables [Abstract] | |
Schedule of Accounts Receivable | As of March 31, 2021 and December 31, 2020, the Company’s accounts receivable consisted of the following: March 31, 2021 December 31, 2020 (Unaudited) Gross accounts receivable $ 1,875,136 $ 1,542,665 Less: allowance for doubtful accounts (28,982 ) (28,982 ) Accounts receivable, net $ 1,846,154 $ 1,513,683 |
Business Acquisitions (Tables)
Business Acquisitions (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Business Combinations [Abstract] | |
Schedule of Assets Acquired and Liabilities Assumed | The following table summarizes the fair value of consideration paid and the allocation of purchase price to the fair value of net assets acquired for the acquisition of the IMAC Florida businesses: Orlando Tampa Property & equipment $ 149,720 $ 7,400 Customer lists - 413,600 Current liabilities (7,220 ) - $ 142,500 $ 421,000 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | The Company’s property and equipment consisted of the following at March 31, 2021 and December 31, 2020: Estimated Useful Life in Years March 31, 2021 December 31, 2020 Leasehold improvements Shorter of asset or lease term $ 2,070,041 $ 2,064,669 Equipment 1.5 - 7 2,190,266 2,012,276 Total property and equipment 4,260,307 4,076,945 Less: accumulated depreciation (2,454,187 ) (2,302,273 ) 1,806,120 1,774,672 Construction in progress 24,573 2,370 Total property and equipment, net $ 1,830,693 $ 1,777,042 |
Intangibles Assets and Goodwi_2
Intangibles Assets and Goodwill (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | The Company’s intangible assets and goodwill consisted of the following at March 31, 2021 and December 31, 2020: March 31, 2021 Estimated Accumulated Useful Life Cost Amortization Net Intangible assets: Management service agreements 10 years $ 7,940,398 $ (1,904,888 ) $ 6,035,510 Non-compete agreements 3 years 301,000 (282,223 ) 18,777 Customer lists 3 years 548,482 (79,179 ) 469,303 Brand development 10 years 55,045 (445 ) 54,600 Definite lived assets 8,844,925 (2,266,735 ) 6,578,190 Research and development 243,750 - 243,750 Goodwill 2,040,696 - 2,040,696 Total intangible assets and goodwill $ 11,129,371 $ (2,266,735 ) $ 8,862,636 December 31, 2020 Estimated Accumulated Useful Life Cost Amortization Net Intangible assets: Management service agreements 10 years $ 7,940,398 $ (1,706,379 ) $ 6,234,019 Non-compete agreements 3 years 301,000 (257,139 ) 43,861 Customer lists 3 years 134,882 (44,961 ) 89,921 Definite lived assets 8,376,280 (2,008,479 ) 6,367,801 Research and development 243,750 - 243,750 Goodwill 2,040,696 - 2,040,696 Total intangible assets and goodwill $ 10,660,726 $ (2,008,479 ) $ 8,652,247 |
Schedule of Future Amortization of Intangible Assets | The Company’s estimated future amortization of intangible assets was as follows: Years Ending December 31, 2021 (nine months) $ 754,180 2022 980,537 2023 935,576 2024 809,198 2025 797,709 Thereafter 2,300,990 $ 6,578,190 |
Operating Leases (Tables)
Operating Leases (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Schedule of Operating Lease Right of Use Assets | Right of use assets included in the Company’s condensed consolidated balance sheet were as follows: March 31, 2021 December 31, 2020 Non-current assets Right of use assets, net of amortization $ 3,956,697 $ 3,816,035 |
Schedule of Operating Lease Cost | Individual components of the total lease cost incurred by the Company were as follows: Three Months Ended March 31, 2021 Three Months Ended March 31, 2020 Operating lease expense $ 293,793 $ 306,632 |
Schedule of Future Minimum Lease Payments | The Company’s amount of future minimum lease payments under operating leases are as follows: Operating Leases Undiscounted future minimum lease payments: 2021 (nine months) $ 967,531 2022 1,290,317 2023 1,184,577 2024 784,988 2025 430,482 Thereafter 303,790 Total 4,961,685 Amount representing imputed interest (277,426 ) Total operating lease liability 4,684,259 Current portion of operating lease liability (1,182,383 ) Operating lease liability, non-current $ 3,501,876 |
Notes Payable (Tables)
Notes Payable (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Notes Payable | Set forth below is a summary of the Company’s outstanding debt as of March 31, 2021 and December 31, 2020: March 31, December 31, 2021 2020 Note payable to Edward S. Bredniak in the amount of up to $2,000,000. An existing note payable with this entity in the amount of $379,676 has been combined into the new note payable which carries an interest rate of 10% per annum. This note was amended in September 2020 and all outstanding balances are due January 5, 2022. $ - $ 1,750,000 Note payable to a financial institution in the amount of $200,000 dated November 15, 2017. The note requires 66 consecutive monthly installments of $2,652 including principal and interest at 5%, with a balloon payment of $60,000 which was paid on June 15, 2018. The note matures on May 15, 2023, and is secured by the personal guarantees of certain Company executives. 65,157 72,238 Note payable to a financial institution in the amount of $131,400 dated August 1, 2016. The note requires 120 monthly installments of $1,394 including principal and interest at 5%. The note matures on July 1, 2026, and is secured by a letter of credit. 78,152 81,330 Note payable to a financial institution in the amount of $200,000 dated May 4, 2016. The note requires 60 monthly installments of $3,881 including principal and interest at 4.25%. The note matures on May 4, 2021, and is secured by the equipment and personal guarantees of certain Company executives. 7,711 19,191 Note payable to an employee in the amount of $101,906 dated March 8, 2017. The note requires payments in five annual installments of $23,350, including principal and interest at 5%. The note matures on December 31, 2021, and is unsecured. 20,000 20,000 $112,800 payable to a landlord of Advantage Therapy, LLC pursuant to a lease dated March 1, 2019. The debt is payable in 60 monthly installments of $2,129, including principal and interest at 5%. The debt matures on June 1, 2024. 76,478 81,862 Note payable to a financial institution in the amount of $140,000, dated September 25, 2019. The note requires 36 consecutive monthly installments of $4,225 including principal and interest at 5.39%. The note matures on September 19, 2022 and is secured by a personal guarantee of the Vice President of Business Development of the Company. 72,855 84,444 Note payable in the amount of $2,690,000, dated October 29, 2020. The note is payable on or before April 29, 2022. The interest on the note accrues at a rate of 7% per annum and is payable on the maturity date or otherwise in accordance with the note. 2,690,000 2,690,000 Unamortized debt issuance costs (234,643 ) (312,858 ) 2,775,710 4,486,207 Less: current portion: (2,595,498 ) (2,527,324 ) $ 180,212 $ 1,958,883 |
Schedule of Principal Maturities of Notes Payable | Principal maturities of the Company’s notes payable are as follows: Years Ending December 31, Amount 2021 (nine months) $ 2,566,827 2022 104,186 2023 51,657 2024 27,631 2025 15,813 Thereafter 9,596 Total $ 2,775,710 |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Schedule of Statutory Federal Income Tax Rate | The provision for income taxes differs from the amount computed by applying the statutory federal income tax rate to income before provision for income taxes. The sources and tax effects of the differences are as follows: Deferred tax benefit at the federal statutory rate 21 % Valuation allowance -21 % 0 % |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Accounting Policies [Abstract] | |||
Cash equivalents | |||
Advertising and marketing expense | 265,548 | $ 241,817 | |
Uncertain tax positions |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Patient Revenue, Net (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Accounting Policies [Abstract] | ||
Patient revenue, net | $ 3,024,808 | $ 3,309,069 |
Capital Requirements, Liquidi_2
Capital Requirements, Liquidity and Going Concern Considerations (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | ||
May 13, 2021 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Working capital | $ 11,700,000 | $ 1,200,000 | ||
Net loss | (1,990,035) | $ (1,733,545) | ||
Net cash (used in) operating activities | (1,749,902) | (1,157,207) | ||
Proceeds from shares sold | 17,209,924 | $ 1,403,837 | ||
Subsequent Event [Member] | ||||
Number of shares sold | 1,193,750 | |||
Proceeds from shares sold | $ 1,900,000 | |||
Initial Public Offering [Member] | ||||
Proceeds from offering | $ 17,000,000 |
Concentration of Credit Risks_2
Concentration of Credit Risks (Details Narrative) | Mar. 31, 2021USD ($) |
Risks and Uncertainties [Abstract] | |
FDIC insured amount | $ 250,000 |
Concentration of Credit Risks -
Concentration of Credit Risks - Schedule of Concentration Risk (Details) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Revenue [Member] | Patient Payment [Member] | ||
Concentration of credit risk, percentage | 37.00% | 35.00% |
Revenue [Member] | Medicare Payment [Member] | ||
Concentration of credit risk, percentage | 40.00% | 40.00% |
Revenue [Member] | Insurance Payment [Member] | ||
Concentration of credit risk, percentage | 23.00% | 25.00% |
Accounts Receivable [Member] | Patient Payment [Member] | ||
Concentration of credit risk, percentage | 33.00% | 38.00% |
Accounts Receivable [Member] | Medicare Payment [Member] | ||
Concentration of credit risk, percentage | 15.00% | 16.00% |
Accounts Receivable [Member] | Insurance Payment [Member] | ||
Concentration of credit risk, percentage | 52.00% | 46.00% |
Accounts Receivable - Schedule
Accounts Receivable - Schedule of Accounts Receivable (Details) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Receivables [Abstract] | ||
Gross accounts receivable | $ 1,875,136 | $ 1,542,665 |
Less: allowance for doubtful accounts | (28,982) | (28,982) |
Accounts receivable, net | $ 1,846,154 | $ 1,513,683 |
Business Acquisitions (Details
Business Acquisitions (Details Narrative) - USD ($) | Mar. 31, 2021 | Feb. 28, 2021 |
Schema Information | Orlando [Member] | ||
Asset purchase price of acquisition | $ 142,500 | |
Management Services Agreement [Member] | Willmitch Chiropractic P.A [Member] | Tampa [Member] | ||
Asset purchase price of acquisition | $ 421,000 |
Business Acquisitions - Schedul
Business Acquisitions - Schedule of Assets Acquired and Liabilities Assumed (Details) | Mar. 31, 2021USD ($) |
Orlando [Member] | |
Property & equipment | $ 149,720 |
Customer lists | |
Current liabilities | (7,220) |
Net Assets Acquired | 142,500 |
Tampa [Member] | |
Property & equipment | 7,400 |
Customer lists | 413,600 |
Current liabilities | |
Net Assets Acquired | $ 421,000 |
Property and Equipment (Details
Property and Equipment (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation | $ 163,945 | $ 218,843 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Total property and equipment, gross | $ 4,260,307 | $ 4,076,945 |
Less: accumulated depreciation | (2,454,187) | (2,302,273) |
Property and equipment | 1,806,120 | 1,774,672 |
Construction in progress | 24,573 | 2,370 |
Total property and equipment, net | $ 1,830,693 | 1,777,042 |
Leasehold Improvements [Member] | ||
Estimated Useful Life | Shorter of asset or lease term | |
Total property and equipment, gross | $ 2,070,041 | 2,064,669 |
Equipment [Member] | ||
Total property and equipment, gross | $ 2,190,266 | $ 2,012,276 |
Equipment [Member] | Minimum [Member] | ||
Estimated Useful Life in Years | 1 year 6 months | |
Equipment [Member] | Maximum [Member] | ||
Estimated Useful Life in Years | 7 years |
Intangibles Assets and Goodwi_3
Intangibles Assets and Goodwill (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization of intangible assets | $ 258,256 | $ 231,652 |
Intangibles Assets and Goodwi_4
Intangibles Assets and Goodwill - Schedule of Intangible Assets (Details) - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Intangible assets, net | $ 6,578,190 | |
Intangible assets, including goodwill, cost | 11,129,371 | $ 10,660,726 |
Goodwill | 2,040,696 | 2,040,696 |
Total intangible assets and goodwill | $ 8,862,636 | $ 8,652,247 |
Customer Lists [Member] | ||
Intangible assets, estimated useful life | 3 years | 3 years |
Intangible assets, cost | $ 548,482 | $ 134,882 |
Intangible assets, Accumulated Amortization | (79,179) | (44,961) |
Intangible assets, net | $ 469,303 | 89,921 |
Brand Development [Member] | ||
Intangible assets, estimated useful life | 10 years | |
Intangible assets, cost | $ 55,045 | |
Intangible assets, Accumulated Amortization | (445) | |
Intangible assets, net | 54,600 | |
Definite Lived Assets [Member] | ||
Intangible assets, cost | 8,844,925 | 8,376,280 |
Intangible assets, Accumulated Amortization | (2,266,735) | (2,008,479) |
Intangible assets, net | 6,578,190 | 6,367,801 |
Research and Development [Member] | ||
Intangible assets, cost | 243,750 | 243,750 |
Intangible assets, Accumulated Amortization | ||
Intangible assets, net | $ 243,750 | $ 243,750 |
Management Service Agreement [Member] | ||
Intangible assets, estimated useful life | 10 years | 10 years |
Intangible assets, cost | $ 7,940,398 | $ 7,940,398 |
Intangible assets, Accumulated Amortization | (1,904,888) | (1,706,379) |
Intangible assets, net | $ 6,035,510 | $ 6,234,019 |
Non-Compete Agreement [Member] | ||
Intangible assets, estimated useful life | 3 years | 3 years |
Intangible assets, cost | $ 301,000 | $ 301,000 |
Intangible assets, Accumulated Amortization | (282,223) | (257,139) |
Intangible assets, net | $ 18,777 | $ 43,861 |
Intangibles Assets and Goodwi_5
Intangibles Assets and Goodwill - Schedule of Future Amortization of Intangible Assets (Details) | Mar. 31, 2021USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2021 (nine months) | $ 754,180 |
2022 | 980,537 |
2023 | 935,576 |
2024 | 809,198 |
2025 | 797,709 |
Thereafter | 2,300,990 |
Total | $ 6,578,190 |
Operating Leases (Details Narra
Operating Leases (Details Narrative) | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Mortgage interest rate term | 10 years |
Operating Leases - Schedule of
Operating Leases - Schedule of Operating Lease Right of Use Assets (Details) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Leases [Abstract] | ||
Right of use assets, net of amortization | $ 3,956,697 | $ 3,816,035 |
Operating Leases - Schedule o_2
Operating Leases - Schedule of Operating Lease Cost (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Leases [Abstract] | ||
Operating lease expense | $ 293,793 | $ 306,632 |
Operating Leases - Schedule o_3
Operating Leases - Schedule of Future Minimum Lease Payments (Details) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Leases [Abstract] | ||
2021 (nine months) | $ 967,531 | |
2021 | 1,290,317 | |
2023 | 1,184,577 | |
2024 | 784,988 | |
2025 | 430,482 | |
Thereafter | 303,790 | |
Total | 4,961,685 | |
Amount representing imputed interest | (277,426) | |
Total operating lease liability | 4,684,259 | |
Current portion of operating lease liability | (1,182,383) | $ (1,078,107) |
Operating lease liability, non-current | $ 3,501,876 | $ 3,506,484 |
Notes Payable - Schedule of Not
Notes Payable - Schedule of Notes Payable (Details) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 | Oct. 29, 2020 |
Notes payable | $ 2,775,710 | $ 4,486,207 | |
Unamortized debt issuance costs | (234,643) | (312,858) | |
Less: current portion: | (2,595,498) | (2,527,324) | |
Notes payable, net of current portion | 180,212 | 1,958,883 | |
Notes Payable [Member] | |||
Notes payable | 1,750,000 | ||
Notes Payable One [Member] | |||
Notes payable | 65,157 | 72,238 | |
Notes Payable Two [Member] | |||
Notes payable | 78,152 | 81,330 | |
Notes Payable Three [Member] | |||
Notes payable | 7,711 | 19,191 | |
Notes Payable Four [Member] | |||
Notes payable | 20,000 | 20,000 | |
Notes Payable Five [Member] | |||
Notes payable | 76,478 | 81,862 | |
Notes Payable Six [Member] | |||
Notes payable | 72,855 | 84,444 | |
Notes Payable Seven [Member] | |||
Notes payable | $ 2,690,000 | $ 2,690,000 | $ 2,690,000 |
Notes Payable - Schedule of N_2
Notes Payable - Schedule of Notes Payable (Details) (Parenthetical) | Oct. 29, 2020USD ($) | Sep. 25, 2019USD ($)Integer | Mar. 01, 2019USD ($)Integer | Nov. 15, 2017USD ($)Integer | Mar. 08, 2017USD ($)Integer | Aug. 01, 2016USD ($)Integer | May 04, 2016USD ($)Integer | Mar. 31, 2021USD ($) | Dec. 31, 2020USD ($) |
Notes payable | $ 2,775,710 | $ 4,486,207 | |||||||
Notes Payable [Member] | |||||||||
Notes payable | 1,750,000 | ||||||||
Notes Payable One [Member] | |||||||||
Notes payable | 65,157 | 72,238 | |||||||
Notes Payable One [Member] | Financial Institution [Member] | |||||||||
Notes payable | $ 200,000 | ||||||||
Debt instrument interest rate | 5.00% | ||||||||
Debt instrument maturity date | May 15, 2023 | ||||||||
Number of installments | Integer | 66 | ||||||||
Debt instrument, periodic payment | $ 2,652 | ||||||||
Debt instrument balloon payment | $ 60,000 | ||||||||
Notes Payable Two [Member] | |||||||||
Notes payable | 78,152 | 81,330 | |||||||
Notes Payable Two [Member] | Financial Institution [Member] | |||||||||
Notes payable | $ 131,400 | ||||||||
Debt instrument interest rate | 5.00% | ||||||||
Debt instrument maturity date | Jul. 1, 2026 | ||||||||
Number of installments | Integer | 120 | ||||||||
Debt instrument, periodic payment | $ 1,394 | ||||||||
Notes Payable Three [Member] | |||||||||
Notes payable | 7,711 | 19,191 | |||||||
Notes Payable Three [Member] | Financial Institution [Member] | |||||||||
Notes payable | $ 200,000 | ||||||||
Debt instrument interest rate | 4.25% | ||||||||
Debt instrument maturity date | May 4, 2021 | ||||||||
Number of installments | Integer | 60 | ||||||||
Debt instrument, periodic payment | $ 3,881 | ||||||||
Notes Payable Four [Member] | |||||||||
Notes payable | 20,000 | 20,000 | |||||||
Notes Payable Five [Member] | |||||||||
Notes payable | 76,478 | 81,862 | |||||||
Notes Payable Five [Member] | Advantage Therapy, LLC [Member] | |||||||||
Notes payable | $ 112,800 | ||||||||
Debt instrument interest rate | 5.00% | ||||||||
Debt instrument maturity date | Jun. 1, 2024 | ||||||||
Number of installments | Integer | 60 | ||||||||
Debt instrument, periodic payment | $ 2,129 | ||||||||
Notes Payable Six [Member] | |||||||||
Notes payable | 72,855 | 84,444 | |||||||
Notes Payable Six [Member] | Financial Institution [Member] | |||||||||
Notes payable | $ 140,000 | ||||||||
Debt instrument interest rate | 5.39% | ||||||||
Debt instrument maturity date | Sep. 19, 2022 | ||||||||
Number of installments | Integer | 36 | ||||||||
Debt instrument, periodic payment | $ 4,225 | ||||||||
Notes Payable Seven [Member] | |||||||||
Notes payable | $ 2,690,000 | 2,690,000 | $ 2,690,000 | ||||||
Debt instrument interest rate | 7.00% | ||||||||
Debt instrument maturity date | Apr. 29, 2022 | ||||||||
Edward S. Bredniak [Member] | Notes Payable [Member] | |||||||||
Debt instrument face amount | 2,000,000 | ||||||||
Notes payable | $ 379,676 | ||||||||
Debt instrument interest rate | 10.00% | ||||||||
Debt instrument maturity date | Jan. 5, 2022 | ||||||||
Employee [Member] | Notes Payable Four [Member] | |||||||||
Notes payable | $ 101,906 | ||||||||
Debt instrument interest rate | 5.00% | ||||||||
Debt instrument maturity date | Dec. 31, 2021 | ||||||||
Number of installments | Integer | 5 | ||||||||
Debt instrument, periodic payment | $ 23,350 |
Notes Payable - Schedule of Pri
Notes Payable - Schedule of Principal Maturities of Notes Payable (Details) | Mar. 31, 2021USD ($) |
Debt Disclosure [Abstract] | |
2021 (nine months) | $ 2,566,827 |
2022 | 104,186 |
2023 | 51,657 |
2024 | 27,631 |
2025 | 15,813 |
Thereafter | 9,596 |
Total | $ 2,775,710 |
Stockholders' Equity (Details N
Stockholders' Equity (Details Narrative) - USD ($) | Jan. 30, 2021 | Oct. 20, 2020 | Oct. 05, 2020 | Jun. 18, 2020 | May 21, 2020 | Aug. 13, 2019 | May 21, 2019 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | May 31, 2018 |
Common stock par value | $ 0.001 | $ 0.001 | |||||||||
Proceeds from common stock | $ 17,209,924 | $ 1,403,837 | |||||||||
Restricted Stock Units (RSUs) [Member] | |||||||||||
Outstanding restricted stock of its common stock | $ 277,500 | ||||||||||
Number of shares vested | 300,000 | 10,000 | 30,000 | ||||||||
Restricted Stock Units (RSUs) [Member] | Non-executive Staff and Contractors [Member] | |||||||||||
Vesting period | 1 year | ||||||||||
Number of shares vested | 15,000 | ||||||||||
Non-Qualified Stock Options [Member] | Various Employees [Member] | |||||||||||
Outstanding stock options to purchase stock | 435,518 | ||||||||||
Vesting period | 4 years | ||||||||||
Vesting percentage | 25.00% | ||||||||||
Vesting description | These options vest over a period of four years, with 25% vesting after one year and the remaining 75% vesting in equal monthly installments over the following 36 months and are exercisable for a period of ten years. Stock based compensation for stock options is estimated at the grant date based on the fair value calculated using the Black-Scholes method. | ||||||||||
Volatility rate | 32.20% | ||||||||||
Risk free rate | 2.40% | ||||||||||
Expected term | 10 years | ||||||||||
2018 Incentive Compensation Plan [Member] | |||||||||||
Reserving for issuance | 1,000,000 | ||||||||||
Ascendiant Capital Markets [Member] | |||||||||||
Number of shares issued during period, shares | 1,541,758 | ||||||||||
Proceeds from common stock | $ 2,900,000 | ||||||||||
Initial Public Offering [Member] | |||||||||||
Gross proceeds from initial public offering | $ 17,000,000 | ||||||||||
Initial Public Offering [Member] | Ascendiant Capital Markets [Member] | |||||||||||
Number of shares issued during period, shares | 10,625,000 | ||||||||||
Gross proceeds from initial public offering | $ 17,000,000 | ||||||||||
Payment for indebtedness | $ 1,800,000 | ||||||||||
Securities Purchase Agreement [Member] | Registered Direct Offering [Member] | |||||||||||
Number of shares issued during period, shares | 1,764,000 | ||||||||||
Shares issued price per share | $ 1.50 | ||||||||||
Gross proceeds from initial public offering | $ 2,644,000 | ||||||||||
Payment for indebtedness | $ 500,000 | ||||||||||
At-The-Market Issuance Sales Agreement [Member] | |||||||||||
Number of common stock issued | $ 5,000,000 | ||||||||||
Common stock par value | $ 0.001 |
Retirement Plan (Details Narrat
Retirement Plan (Details Narrative) - 401(k) Plan [Member] - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Matching contributions, percentage of match | 50.00% | |
Matching contributions, percent of employees' gross pay | 6.00% | |
Matching contributions, amount | $ 34,074 | $ 19,690 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Income Tax Disclosure [Abstract] | |
Operating loss carryforward, net | $ 11,400,000 |
Operating loss carryforward, description | There is no expiration of this carryforward as it was generated after December 31, 2017. |
Income Taxes - Schedule of Stat
Income Taxes - Schedule of Statutory Federal Income Tax Rate (Details) | 3 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Deferred tax benefit at the federal statutory rate | 21.00% |
Valuation allowance | (21.00%) |
Statutory federal income tax rate | 0.00% |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - Subsequent Event [Member] - USD ($) | Apr. 15, 2021 | Apr. 07, 2021 | May 13, 2021 |
Number of shares issued during period, shares | 1,193,750 | ||
Underwriters [Member] | Initial Public Offering [Member] | |||
Number of shares issued during period, shares | 1,193,750 | ||
Shares issued, price per share | $ 1.60 | ||
Underwriters [Member] | Over-Allotment Option [Member] | |||
Percentage of over-allotment option exercised | 15.00% | ||
Contractor [Member] | Covent Bridge Group [Member] | |||
Overpaid amount | $ 2,921,868 | ||
Statistical extrapolation amount | $ 11,530 |