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As Of Filer Filing For·On·As Docs:Size 10/30/19 Healthier Choices Mgmt Corp. 10-Q 9/30/19 57:3.4M |
Document/Exhibit Description Pages Size 1: 10-Q Quarterly Report HTML 309K 2: EX-31.1 Certification -- §302 - SOA'02 HTML 25K 3: EX-31.2 Certification -- §302 - SOA'02 HTML 25K 4: EX-32.1 Certification -- §906 - SOA'02 HTML 18K 5: EX-32.2 Certification -- §906 - SOA'02 HTML 18K 40: R1 Document and Entity Information HTML 65K 19: R2 Condensed Consolidated Balance Sheets (Unaudited) HTML 111K 24: R3 Condensed Consolidated Balance Sheets (Unaudited) HTML 38K (Parenthetical) 56: R4 Condensed Consolidated Statements of Operations HTML 59K (Unaudited) 41: R5 Condensed Consolidated Stockholders' Equity HTML 97K Statements (Unaudited) 20: R6 Condensed Consolidated Statements of Cash Flows HTML 105K (Unaudited) 25: R7 Organization, Going Concern, and Basis of HTML 28K Presentation 57: R8 Summary of Significant Accounting Policies HTML 23K 39: R9 Concentrations HTML 26K 31: R10 Disaggregation of Revenues HTML 40K 13: R11 Intangible Assets HTML 49K 46: R12 Contract Assets and Contract Liabilities HTML 28K 51: R13 Stockholders' Equity HTML 48K 30: R14 Fair Value Measurements HTML 35K 12: R15 Commitments and Contingencies HTML 21K 45: R16 Lease HTML 40K 50: R17 Organization, Going Concern, and Basis of HTML 28K Presentation (Policies) 29: R18 Summary of Significant Accounting Policies HTML 28K (Policies) 14: R19 Concentrations (Tables) HTML 28K 37: R20 Disaggregation of Revenues (Tables) HTML 40K 55: R21 Intangible Assets (Tables) HTML 53K 28: R22 Contract Assets and Contract Liabilities (Tables) HTML 26K 22: R23 Stockholders' Equity (Tables) HTML 54K 36: R24 Fair Value Measurements (Tables) HTML 33K 54: R25 Lease (Tables) HTML 43K 26: R26 Organization, Going Concern, and Basis of HTML 25K Presentation (Details) 21: R27 Summary of Significant Accounting Policies HTML 34K (Details) 38: R28 CONCENTRATIONS, Cash (Details) HTML 21K 53: R29 CONCENTRATIONS, Vendor (Details) HTML 28K 47: R30 Disaggregation of Revenues (Details) HTML 39K 43: R31 INTANGIBLE ASSETS, Net (Details) HTML 50K 15: R32 INTANGIBLE ASSETS, Future Annual Estimated HTML 43K Amortization Expense (Details) 32: R33 Contract Assets and Contract Liabilities (Details) HTML 39K 48: R34 STOCKHOLDERS' EQUITY, Series A Warrants (Details) HTML 50K 44: R35 STOCKHOLDERS' EQUITY, Stock Options (Details) HTML 25K 16: R36 STOCKHOLDERS' EQUITY, Loss Per Share (Details) HTML 27K 33: R37 Fair Value Measurements (Details) HTML 32K 49: R38 Commitments and Contingencies (Details) HTML 19K 42: R39 Lease, Asc 842 (Details) HTML 27K 52: R40 LEASE, Maturity of Lease Liabilities (Details) HTML 36K 35: R41 LEASE, Balance Sheet Classification and Other HTML 30K Information (Details) 17: R42 LEASE, Components of Lease Cost (Details) HTML 26K 23: R43 LEASE, Cash Flows and Supplemental Balance Sheet HTML 43K Information Related to Operating Leases (Details) 18: XML IDEA XML File -- Filing Summary XML 96K 27: EXCEL IDEA Workbook of Financial Reports XLSX 50K 6: EX-101.INS XBRL Instance -- hcmc-20190930 XML 937K 8: EX-101.CAL XBRL Calculations -- hcmc-20190930_cal XML 148K 9: EX-101.DEF XBRL Definitions -- hcmc-20190930_def XML 311K 10: EX-101.LAB XBRL Labels -- hcmc-20190930_lab XML 1.09M 11: EX-101.PRE XBRL Presentations -- hcmc-20190930_pre XML 658K 7: EX-101.SCH XBRL Schema -- hcmc-20190930 XSD 122K 34: ZIP XBRL Zipped Folder -- 0000844856-19-000006-xbrl Zip 117K
Delaware
|
84-1070932
|
|
(State or other jurisdiction of
|
(I.R.S. Employer
|
|
incorporation or organization)
|
Identification No.)
|
|
3800 North 28Th Way
|
||
(Address of principal executive offices)
|
(Zip Code)
|
Large accelerated filer
|
☐
|
Accelerated filer
|
☐
|
Non-accelerated filer
|
☒
|
Smaller reporting company
|
☒
|
Emerging growth company
|
☐
|
Title of each class
|
Trading Symbol
|
Name of each exchange on which registered
|
||
Common Stock, par value $0.0001 per share
|
HCMC
|
OTC Pink Marketplace
|
PAGE
|
|
ASSETS
|
|||||
CURRENT ASSETS
|
|||||
Cash and cash equivalents
|
$
|
4,248,984
|
$
|
7,061,253
|
|
Accounts receivable, net
|
42,371
|
51,951
|
|||
Inventories
|
1,881,225
|
1,864,619
|
|||
Prepaid expenses and vendor deposits
|
306,274
|
402,578
|
|||
Investment
|
33,343
|
90,857
|
|||
Contract assets
|
18,000
|
32,400
|
|||
TOTAL CURRENT ASSETS
|
6,530,197
|
9,503,658
|
|||
Property and equipment, net of accumulated depreciation
|
353,681
|
497,039
|
|||
Intangible assets, net of accumulated amortization
|
2,029,610
|
3,062,204
|
|||
Goodwill
|
1,437,314
|
1,437,314
|
|||
Note receivable
|
390,757
|
528,007
|
|||
Right of use asset – operating lease, net
|
4,528,468
|
-
|
|||
Other assets
|
147,864
|
144,441
|
|||
TOTAL ASSETS
|
$
|
15,417,891
|
$
|
15,172,663
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|||||
CURRENT LIABILITIES
|
|||||
Accounts payable and accrued expenses
|
$
|
851,297
|
$
|
1,301,418
|
|
Contract liabilities
|
174,328
|
442,630
|
|||
Operating lease liability, current
|
472,106
|
-
|
|||
Loan payable, current
|
282,314
|
282,224
|
|||
Credit line
|
2,000,000
|
1,868,460
|
|||
Derivative liabilities – warrants
|
1,719,816
|
1,722,928
|
|||
TOTAL CURRENT LIABILITIES
|
5,499,861
|
5,617,660
|
|||
Loan payable, net of current portion
|
939,821
|
1,128,234
|
|||
Operating lease liability, net of current
|
3,474,665
|
-
|
|||
TOTAL LIABILITIES
|
9,914,347
|
6,745,894
|
|||
COMMITMENTS AND CONTINGENCIES (SEE NOTE 9)
|
|||||
STOCKHOLDERS’ EQUITY
|
|||||
Series B convertible preferred stock, $1,000 par value per share, 30,000 shares authorized; 20,150 shares
issued and outstanding as of September 30, 2019 and December 31, 2018; aggregate liquidation preference of $20.2 million
|
20,150,116
|
20,150,116
|
|||
Common Stock, $0.0001 par value per share, 750,000,000,000 shares authorized; 67,698,494,241 and
66,623,514,522 shares issued and outstanding as of September 30, 2019 and December 31, 2018, respectively
|
6,769,849
|
6,662,351
|
|||
Additional paid-in capital
|
7,587,828
|
7,348,390
|
|||
Accumulated deficit
|
(29,004,249)
|
(25,734,088)
|
|||
TOTAL STOCKHOLDERS’ EQUITY
|
5,503,544
|
8,426,769
|
|||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
|
$
|
15,417,891
|
$
|
15,172,663
|
Three Months Ended
|
Nine Months Ended
|
||||||||||
September 30,
|
|||||||||||
2018
|
2019
|
2018
|
|||||||||
SALES
|
|||||||||||
Vapor sales, net
|
$
|
898,229
|
$
|
1,106,596
|
$
|
3,207,530
|
$
|
3,556,130
|
|||
Grocery sales, net
|
2,520,101
|
1,923,878
|
8,407,919
|
6,359,671
|
|||||||
TOTAL SALES, NET
|
3,418,330
|
3,030,474
|
11,615,449
|
9,915,801
|
|||||||
Cost of sales vapor
|
385,208
|
460,648
|
1,337,555
|
1,602,363
|
|||||||
Cost of sales grocery
|
1,629,980
|
1,183,033
|
5,309,567
|
3,850,998
|
|||||||
GROSS PROFIT
|
1,403,142
|
1,386,793
|
4,968,327
|
4,462,440
|
|||||||
OPERATING EXPENSES
|
2,532,505
|
2,179,492
|
8,057,452
|
7,334,165
|
|||||||
LOSS FROM OPERATIONS
|
(1,129,363)
|
(792,699)
|
(3,089,125)
|
(2,871,725)
|
|||||||
OTHER (EXPENSE) INCOME
|
|||||||||||
Gain (loss) on investment
|
(12,514)
|
11,999
|
(57,514)
|
11,999
|
|||||||
Other income (expense), net
|
(146)
|
152,260
|
(838)
|
469,760
|
|||||||
Interest income (expense), net
|
(8,280)
|
30,458
|
(19,669)
|
63,219
|
|||||||
Gain (loss) on repurchase of Series A warrants
|
-
|
(10,696,774)
|
-
|
(10,696,774)
|
|||||||
Total other (expense) income, net
|
(20,940)
|
(10,502,057)
|
(78,021)
|
(10,151,796)
|
|||||||
NET LOSS
|
$
|
(1,150,303)
|
$
|
(11,294,756)
|
$
|
(3,167,146)
|
$
|
(13,023,521)
|
|||
NET LOSS PER SHARE-BASIC AND DILUTED
|
$
|
0.00
|
$
|
0.00
|
$
|
0.00
|
$
|
0.00
|
|||
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING-BASIC AND DILUTED
|
66,929,136,282
|
45,821,526,888
|
66,734,751,470
|
34,900,093,115
|
Convertible
Preferred Stock
|
Common Stock
|
Additional
Paid-In
|
Accumulated
|
|||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
Capital
|
Deficit
|
Total
|
||||||||||||||
Balance – July 1, 2019
|
20,150
|
$
|
20,150,116
|
66,645,257,694
|
$
|
6,664,526
|
$
|
7,543,370
|
$
|
(27,853,946)
|
$
|
6,504,066
|
||||||||
Issuance of common stock in connection with cashless exercise of Series A warrants
|
-
|
-
|
53,236,547
|
5,323
|
(3,112)
|
-
|
2,211
|
|||||||||||||
Issuance of awarded stock for board members
|
-
|
-
|
1,000,000,000
|
100,000
|
(100,000)
|
-
|
-
|
|||||||||||||
Stock-based compensation expense
|
-
|
-
|
-
|
-
|
147,570
|
-
|
147,570
|
|||||||||||||
Net loss
|
-
|
-
|
-
|
-
|
-
|
(1,150,303)
|
(1,150,303)
|
|||||||||||||
Balance – September 30, 2019
|
20,150
|
$
|
20,150,116
|
67,698,494,241
|
$
|
6,769,849
|
$
|
7,587,828
|
$
|
(29,004,249)
|
$
|
5,503,544
|
Convertible
Preferred Stock
|
Common Stock
|
Additional
Paid-In
|
Accumulated
|
|||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
Capital
|
Deficit
|
Total
|
||||||||||||||
Balance – July 1, 2018
|
-
|
$
|
-
|
29,348,867,108
|
$
|
2,934,887
|
$
|
11,238,744
|
$
|
(14,299,592)
|
$
|
(125,961)
|
||||||||
Issuance of common stock in connection with cashless exercise of Series A warrants
|
-
|
-
|
1,602,741,446
|
160,274
|
(93,958)
|
-
|
66,317
|
|||||||||||||
Stock options exercised
|
-
|
-
|
777,777,778
|
77,778
|
-
|
-
|
77,778
|
|||||||||||||
Issuance of preferred stock in connection with cashless exercise of Series A warrants
|
20,722
|
20,721,744
|
-
|
-
|
(1,692,747)
|
-
|
19,028,997
|
|||||||||||||
Modification of share-based payment awards to officers
|
-
|
-
|
19,000,000,000
|
1,900,000
|
(1,900,000)
|
-
|
-
|
|||||||||||||
Issuance of awarded stock for officers
|
-
|
-
|
3,000,000,000
|
300,000
|
(300,000)
|
-
|
-
|
|||||||||||||
Issuance of awarded stock for professional services
|
-
|
-
|
3,000,000,000
|
300,000
|
(300,000)
|
-
|
-
|
|||||||||||||
Preferred stock exercised
|
(572)
|
(571,628)
|
5,716,280,000
|
571,628
|
-
|
-
|
-
|
|||||||||||||
Stock swap
|
-
|
-
|
1,500,000,000
|
150,000
|
-
|
-
|
150,000
|
|||||||||||||
Stock-based compensation expense
|
-
|
-
|
-
|
-
|
140,356
|
-
|
140,356
|
|||||||||||||
Net loss
|
(11,294,756)
|
(11,294,756)
|
||||||||||||||||||
Balance – September 30, 2018
|
20,150
|
$
|
20,150,116
|
63,945,666,332
|
$
|
6,394,567
|
$
|
7,092,395
|
$
|
(25,594,348)
|
$
|
8,042,730
|
Convertible
Preferred Stock
|
Common Stock
|
Additional
Paid-In
|
Accumulated
|
|||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
Capital
|
Deficit
|
Total
|
||||||||||||||
Balance – January 1, 2019
|
20,150
|
$
|
20,150,116
|
66,623,514,522
|
$
|
6,662,351
|
$
|
7,348,390
|
$
|
(25,734,088)
|
$
|
8,426,769
|
||||||||
Issuance of common stock in connection with cashless exercise of Series A warrants
|
-
|
-
|
74,979,719
|
7,498
|
(4,386)
|
-
|
3,112
|
|||||||||||||
Issuance of awarded stock for board members
|
-
|
-
|
1,000,000,000
|
100,000
|
(100,000)
|
-
|
-
|
|||||||||||||
Stock-based compensation expense
|
-
|
-
|
-
|
-
|
343,824
|
-
|
343,824
|
|||||||||||||
Cumulative Effect on adoption of ASC 842
|
-
|
-
|
-
|
-
|
-
|
(103,015)
|
(103,015)
|
|||||||||||||
Net loss
|
-
|
-
|
-
|
-
|
-
|
(3,167,146)
|
(3,167,146)
|
|||||||||||||
Balance – September 30, 2019
|
20,150
|
$
|
20,150,116
|
67,698,494,241
|
$
|
6,769,849
|
$
|
7,587,828
|
$
|
(29,004,249)
|
$
|
5,503,544
|
Convertible
Preferred Stock
|
Common Stock
|
Additional
Paid-In
|
Accumulated
|
|||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
Capital
|
Deficit
|
Total
|
||||||||||||||
Balance – January 1, 2018
|
-
|
$
|
-
|
29,348,867,108
|
$
|
2,934,887
|
$
|
10,080,238
|
$
|
(12,570,827)
|
$
|
444,298
|
||||||||
Issuance of common stock in connection with cashless exercise of Series A warrants
|
-
|
-
|
1,602,741,446
|
160,274
|
(93,958)
|
-
|
66,317
|
|||||||||||||
Stock options exercised
|
-
|
-
|
777,777,778
|
77,778
|
-
|
-
|
77,778
|
|||||||||||||
Issuance of preferred stock in connection with cashless exercise of Series A warrants
|
20,722
|
20,721,744
|
-
|
-
|
(1,692,747)
|
-
|
19,028,997
|
|||||||||||||
Modification of share-based payment awards to officers
|
-
|
-
|
19,000,000,000
|
1,900,000
|
(1,900,000)
|
-
|
-
|
|||||||||||||
Issuance of awarded stock for officers
|
-
|
-
|
3,000,000,000
|
300,000
|
(300,000)
|
-
|
-
|
|||||||||||||
Issuance of awarded stock for professional services
|
-
|
-
|
3,000,000,000
|
300,000
|
(300,000)
|
-
|
-
|
|||||||||||||
Preferred stock exercised
|
(572)
|
(571,628)
|
5,716,280,000
|
571,628
|
-
|
-
|
-
|
|||||||||||||
Stock swap
|
-
|
-
|
1,500,000,000
|
150,000
|
-
|
-
|
150,000
|
|||||||||||||
Stock-based compensation expense
|
-
|
-
|
-
|
-
|
1,298,862
|
-
|
1,298,862
|
|||||||||||||
Net loss
|
-
|
-
|
-
|
-
|
-
|
(13,023,521)
|
(13,023,521)
|
|||||||||||||
Balance – September 30, 2018
|
20,150
|
$
|
20,150,116
|
63,945,666,332
|
$
|
6,394,567
|
$
|
7,092,395
|
$
|
(25,594,348)
|
$
|
8,042,730
|
Nine Months Ended
|
|||||
2018
|
|||||
OPERATING ACTIVITIES
|
|||||
Net loss
|
$
|
(3,167,146)
|
$
|
(13,023,521)
|
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|||||
Bad debt expense
|
(3,002)
|
(75,399)
|
|||
Depreciation and amortization
|
449,071
|
269,729
|
|||
Loss on disposal of assets
|
25,427
|
-
|
|||
Loss on investment
|
57,514
|
-
|
|||
Amortization of right-of-use asset
|
459,760
|
-
|
|||
Loss on repurchase of Series A warrants
|
-
|
10,696,774
|
|||
Stock-based compensation expense
|
343,824
|
1,298,862
|
|||
Changes in operating assets and liabilities:
|
|||||
Accounts receivable
|
12,582
|
21,036
|
|||
Inventories
|
(16,606)
|
(144,893)
|
|||
Prepaid expenses and vendor deposits
|
94,110
|
(288,359)
|
|||
Contract assets
|
14,400
|
(180,000)
|
|||
Other assets
|
(3,423)
|
-
|
|||
Accounts payable
|
(155,910)
|
(36,652)
|
|||
Accrued expenses
|
(294,211)
|
(112,343)
|
|||
Contract liabilities
|
(268,302)
|
1,968,682
|
|||
Lease liability
|
(402,857)
|
-
|
|||
NET CASH USED IN OPERATING ACTIVITIES
|
(2,854,769)
|
393,916
|
|||
INVESTING ACTIVITIES
|
|||||
Collection of note receivable
|
137,250
|
10,083
|
|||
Purchases of property and equipment
|
(12,967)
|
(42,520)
|
|||
Purchases of patent
|
(25,000)
|
(37,500)
|
|||
Gain on investment
|
-
|
(11,999)
|
|||
Issuance of note receivable
|
-
|
(500,000)
|
|||
NET CASH PROVIDED BY INVESTING ACTIVITIES
|
99,283
|
(581,936)
|
|||
FINANCING ACTIVITIES
|
|||||
Proceeds from line of credit
|
131,540
|
500,000
|
|||
Principal payments on loan payable
|
(188,323)
|
(1,573)
|
|||
Proceeds from exercise of stock options
|
-
|
77,778
|
|||
NET CASH PROVIDED BY FINANCING ACTIVITIES
|
(56,783)
|
576,205
|
|||
DECREASE IN CASH
|
(2,812,269)
|
388,185
|
|||
CASH AND CASH EQUIVALENTS — BEGINNING OF PERIOD
|
7,061,253
|
7,883,191
|
|||
CASH AND CASH EQUIVALENTS — END OF PERIOD
|
$
|
4,248,984
|
$
|
8,271,376
|
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
|
|||||
Cash paid for interest
|
$
|
107,646
|
$
|
1,750
|
Total Cash in excess of FDIC limits of $250,000
|
$
|
3,309,854
|
6,039,000
|
Purchase in excess of 20% of total purchase
|
|||||
Vendor A
|
22%
|
30%
|
Three Months Ended
|
Nine Months Ended
|
||||||||||
Vapor
|
$
|
898,229
|
$
|
1,106,596
|
$
|
3,207,530
|
$
|
3,556,130
|
|||
Grocery
|
2,520,101
|
1,923,878
|
8,407,919
|
6,359,671
|
|||||||
Total revenue
|
$
|
3,418,330
|
$
|
3,030,474
|
$
|
11,615,449
|
$
|
9,915,801
|
|||
Retail Vapor
|
$
|
898,216
|
$
|
1,106,228
|
$
|
3,207,120
|
$
|
3,548,704
|
|||
Retail Grocery
|
2,133,537
|
1,407,776
|
7,143,616
|
4,581,001
|
|||||||
Food service/restaurant
|
291,435
|
370,609
|
949,211
|
1,167,006
|
|||||||
Online/eCommerce
|
81,035
|
135,483
|
285,891
|
593,347
|
|||||||
Wholesale Grocery
|
14,094
|
10,010
|
29,201
|
18,317
|
|||||||
Wholesale Vapor
|
13
|
368
|
410
|
7,426
|
|||||||
Total revenue
|
$
|
3,418,330
|
$
|
3,030,474
|
$
|
11,615,449
|
$
|
9,915,801
|
Useful Lives (Years)
|
Gross
Carrying Amount
|
Accumulated
Amortization
|
Net
Carrying Amount
|
|||||||||
Trade names
|
8-10 years
|
$
|
993,000
|
$
|
(328,733)
|
$
|
664,267
|
|||||
Customer relationships
|
4-10 years
|
1,228,000
|
(230,198)
|
997,802
|
||||||||
Patents
|
10 years
|
270,250
|
(42,271)
|
227,979
|
||||||||
Non-compete
|
4 years
|
174,000
|
(34,438)
|
139,562
|
||||||||
3 years
|
4,500
|
(4,500)
|
-
|
|||||||||
Intangible assets, net
|
$
|
2,669,750
|
$
|
(640,140)
|
$
|
2,029,610
|
Useful Lives (Years)
|
Gross
Carrying Amount
|
Accumulated
Amortization
|
Net
Carrying Amount
|
|||||||||
Favorable lease
|
15 years
|
$
|
890,000
|
$
|
(150,580)
|
$
|
739,420
|
|||||
Trade names
|
8-10 years
|
993,000
|
(252,329)
|
740,671
|
||||||||
Customer relationships
|
4-10 years
|
1,228,000
|
(41,010)
|
1,186,990
|
||||||||
Patents
|
10 years
|
245,250
|
(22,940)
|
222,310
|
||||||||
Non-compete
|
4 years
|
174,000
|
(1,812)
|
172,188
|
||||||||
3 years
|
4,500
|
(3,875)
|
625
|
|||||||||
Intangible assets, net
|
$
|
3,534,750
|
$
|
(472,546)
|
$
|
3,062,204
|
Years ending December 31,
|
||
2019 (remaining three months)
|
$
|
106,160
|
2020
|
424,650
|
|
2021
|
417,650
|
|
2022
|
402,270
|
|
2023
|
163,400
|
|
Thereafter
|
515,480
|
|
Total
|
$
|
2,029,610
|
Beginning balance as January 1,
|
$
|
442,630
|
$
|
61,312
|
|
Issued
|
50,778
|
81,720
|
|||
Redeemed
|
(57,319)
|
(113,954)
|
|||
Breakage recognized
|
(1,563)
|
916
|
|||
Fulfillment of contract
|
(260,198)
|
2,000,000
|
|||
Ending balance as of September 30,
|
$
|
174,328
|
$
|
2,029,994
|
Exercise
Price
|
Warrant Common
Stock Equivalent
|
Remaining
Contractual Term
|
||||||
Outstanding at January 1, 2019
|
$
|
0.0001
|
41,643,000,000
|
1.50
|
||||
Warrants settlement
|
$
|
-
|
-
|
|||||
Cashless exercises for common stock
|
$
|
(0.0001)
|
(75,000,000)
|
|||||
Black Scholes Value adjustment
|
$
|
(0.0001)
|
(148,000,000)
|
|||||
Outstanding at September 30, 2019
|
$
|
0.0001
|
41,420,000,000
|
0.75
|
Warrants outstanding (A)
|
2.7299
|
2.7348
|
|||
Black Scholes value (B)
|
1,517,280
|
1,522,692
|
|||
Subtotal (C)=(A) x (B)
|
4,142,023
|
4,164,258
|
|||
Closing bid stock price (D)
|
$
|
0.0001
|
$
|
0.0001
|
|
Warrant common stock equivalent (C)/(D)
|
41,420,000,000
|
41,643,000,000
|
Three Months Ended
|
Nine Months Ended
|
||||||||||
Stock-based compensation
|
$
|
147,570
|
$
|
140,356
|
$
|
343,824
|
$
|
1,298,862
|
2018
|
||||||||
Preferred stock
|
201,501,000,000
|
201,501,000,000
|
||||||
Stock options
|
91,062,000,000
|
90,012,000,000
|
||||||
Warrants
|
41,420,000,000
|
44,369,000,000
|
||||||
Total
|
333,983,000,000
|
335,882,000,000
|
● |
Level 2: Fair value measurement of the asset or liability using inputs other than quoted prices that are observable for the applicable asset or liability, either
directly or indirectly, such as quoted prices for similar (as opposed to identical) assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active; and
|
● |
Level 3: Fair value measurement of the asset or liability using unobservable inputs that reflect the Company’s own assumptions regarding the applicable asset or
liability.
|
Level 1
|
Level 2
|
Level 3
|
Total
|
||||||||
LIABILITIES
|
|||||||||||
Derivative liabilities – warrants
|
$
|
-
|
$
|
1,719,816
|
$
|
-
|
$
|
1,719,816
|
|||
Total derivative liabilities – warrants
|
$
|
-
|
$
|
1,719,816
|
$
|
-
|
$
|
1,719,816
|
Level 1
|
Level 2
|
Level 3
|
Total
|
||||||||
LIABILITIES
|
|||||||||||
Derivative liabilities – warrants
|
$
|
-
|
$
|
1,722,928
|
$
|
-
|
$
|
1,722,928
|
|||
Total derivative liabilities – warrants
|
$
|
-
|
$
|
1,722,928
|
$
|
-
|
$
|
1,722,928
|
Maturity of Lease Liabilities by Fiscal Year
|
||
2019 (remaining)
|
$
|
165,350
|
2020
|
633,636
|
|
2021
|
507,682
|
|
2022
|
464,380
|
|
2023
|
441,262
|
|
Thereafter
|
2,888,699
|
|
Total undiscounted operating lease payments
|
$
|
5,101,009
|
Less: Imputed interest
|
(1,154,238)
|
|
Present value of operating lease liabilities
|
$
|
3,946,771
|
Balance Sheet Classification
|
||
Operating lease liability, current
|
$
|
472,106
|
Operating lease liability, net of current
|
3,474,665
|
|
Total operating lease liabilities
|
$
|
3,946,771
|
Other Information
|
||||
Weighted-average remaining lease term for operating leases
|
11 years
|
|||
Weighted-average discount rate for operating leases
|
4.8
|
%
|
Operating lease cost
|
$
|
380,901
|
Variable lease cost
|
238,996
|
|
Short-term lease cost
|
107,759
|
|
Total Rent Expense
|
$
|
727,656
|
Balance Sheet Classification
|
|||||||||
Right of use asset
|
Other assets
|
$
|
4,988,227
|
$
|
4,528,468
|
||||
Lease liability, current
|
Current liabilities
|
$
|
553,316
|
$
|
472,106
|
||||
Lease liability, net of current
|
Other liabilities
|
$
|
3,796,312
|
$
|
3,474,665
|
Three Months Ended September 30,
|
2019 to 2018
|
|||||||
2019
|
2018
|
Change $
|
||||||
SALES
|
||||||||
Vapor sales, net
|
$
|
898,229
|
$
|
1,106,596
|
$
|
(208,367)
|
||
Grocery sales, net
|
2,520,101
|
1,923,878
|
596,223
|
|||||
TOTAL SALES, NET
|
3,418,330
|
3,030,474
|
387,856
|
|||||
Cost of sales vapor
|
385,208
|
460,648
|
(75,440)
|
|||||
Cost of sales grocery
|
1,629,980
|
1,183,033
|
446,947
|
|||||
GROSS PROFIT
|
1,403,142
|
1,386,793
|
16,349
|
|||||
OPERATING EXPENSES
|
||||||||
Advertising
|
46,190
|
56,021
|
(9,831)
|
|||||
Selling, general and administrative
|
2,486,315
|
2,123,471
|
362,844
|
|||||
Total operating expenses
|
2,532,505
|
2,179,492
|
353,013
|
|||||
LOSS FROM OPERATIONS
|
(1,129,363)
|
(792,699)
|
(336,664)
|
|||||
OTHER INCOME (EXPENSE)
|
||||||||
Loss on repurchase of Series A warrants
|
-
|
(10,696,774)
|
(10,696,774)
|
|||||
Gain (loss) on investment
|
(12,514)
|
11,999
|
(24,513)
|
|||||
Other income (expense)
|
(146)
|
152,260
|
(152,406)
|
|||||
Interest income (expense)
|
(8,280)
|
30,458
|
(38,738)
|
|||||
Total other income (expense), net
|
(20,940)
|
(10,502,057)
|
10,481,117
|
|||||
NET LOSS
|
$
|
(1,150,303)
|
$
|
(11,294,756)
|
$
|
10,144,453
|
Nine Months Ended
|
2019 to 2018
|
|||||||
2019
|
2018
|
Change $
|
||||||
SALES
|
||||||||
Vapor sales, net
|
$
|
3,207,530
|
$
|
3,556,130
|
$
|
(348,600)
|
||
Grocery sales, net
|
8,407,919
|
6,359,671
|
2,048,248
|
|||||
TOTAL SALES, NET
|
11,615,449
|
9,915,801
|
1,699,648
|
|||||
Cost of sales vapor
|
1,337,555
|
1,602,363
|
(264,808)
|
|||||
Cost of sales grocery
|
5,309,567
|
3,850,998
|
1,458,569
|
|||||
GROSS PROFIT
|
4,968,327
|
4,462,440
|
505,887
|
|||||
OPERATING EXPENSES
|
||||||||
Advertising
|
135,794
|
137,485
|
(1,691)
|
|||||
Selling, general and administrative
|
7,921,658
|
7,196,680
|
724,978
|
|||||
Total operating expenses
|
8,057,452
|
7,334,165
|
723,287
|
|||||
LOSS FROM OPERATIONS
|
(3,089,125)
|
(2,871,725)
|
(217,400)
|
|||||
OTHER INCOME (EXPENSE)
|
||||||||
Loss on repurchase of Series A warrants
|
-
|
(10,696,774)
|
10,696,774
|
|||||
Gain (loss) on investment
|
(57,514)
|
11,999
|
(69,513)
|
|||||
Other income (expense)
|
(838)
|
469,760
|
(470,598)
|
|||||
Interest income (expense)
|
(19,669)
|
63,219
|
(82,888)
|
|||||
Total other income (expense), net
|
(78,021)
|
(10,151,796)
|
10,073,775
|
|||||
NET LOSS
|
$
|
(3,167,146)
|
$
|
(13,023,521)
|
$
|
9,856,375
|
Nine Months Ended
September 30,
|
|||||
2019
|
2018
|
||||
Net cash used in operating activities
|
$
|
(2,854,769)
|
$
|
393,916
|
|
Net cash provided by investing activities
|
99,283
|
(581,936)
|
|||
Net cash provided by financing activities
|
(56,783)
|
576,205
|
|||
$
|
(2,812,269)
|
$
|
388,185
|
Cash
|
$
|
4,248,984
|
$
|
7,061,253
|
|
Total assets
|
$
|
15,417,891
|
$
|
15,172,663
|
|
Percentage of total assets
|
27.56%
|
46.54%
|
● |
We continue to improve the process around inventory counts and throughout the current year, we performed a blind-count for 75% of our overall inventory value with
the purpose of validating our inventory records and increasing the staff knowledge around the importance of the new inventory procedures implemented. In addition, we had an independent third-party count over 50% of our inventory value
conducted on September 30, 2019.
|
● |
Our management has increased its focus on the Company’s purchase order process in order to better manage inventory thereby improving cash management and ultimately
leading to more reliable and precise financial reporting.
|
Exhibit
|
Filed or Furnished
|
|||||||||
No.
|
Exhibit Description
|
Form
|
Date
|
Number
|
Herewith
|
|||||
31.1
|
Filed
|
|||||||||
31.2
|
Filed
|
|||||||||
32.1
|
Furnished *
|
|||||||||
32.2
|
Furnished *
|
|||||||||
101.INS
|
XBRL Instance Document
|
Filed
|
||||||||
101.SCH
|
XBRL Taxonomy Extension Schema Document
|
Filed
|
||||||||
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
Filed
|
||||||||
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document
|
Filed
|
||||||||
101.LAB
|
XBRL Taxonomy Extension Label Linkbase Document
|
Filed
|
||||||||
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
Filed
|
* |
This exhibit is being furnished rather than filed and shall not be deemed incorporated by reference into any filing, in accordance with Item 601 of Regulation S-K.
|
HEALTHIER CHOICES MANAGEMENT CORP.
|
||
Date: October 29, 2019
|
By:
|
/s/ Jeffrey Holman
|
Chief Executive Officer
|
||
Date: October 29, 2019
|
By:
|
/s/ John Ollet
|
Chief Financial Officer
|
This ‘10-Q’ Filing | Date | Other Filings | ||
---|---|---|---|---|
12/31/19 | 10-K, NT 10-K | |||
Filed as of: | 10/30/19 | |||
Filed on: | 10/29/19 | |||
For Period end: | 9/30/19 | |||
7/1/19 | ||||
3/27/19 | 10-K | |||
1/1/19 | ||||
12/31/18 | 10-K, 8-K | |||
12/15/18 | ||||
9/30/18 | 10-Q | |||
7/1/18 | ||||
5/1/18 | ||||
1/1/18 | ||||
List all Filings |