Long-Term Debt

12 Months Ended

Dec. 31, 2022

10. Long-Term Debt

			2022			2021
(a)	PACE Credit Facility-Due September 2, 2022	$	695,974		$	750,465
(b)	PACE Credit Facility-Due September 2, 2022		389,188			419,661
(c)	PACE Corporate Term Loan-Due September 13, 2022		2,361,424			2,546,536
(d)i.)	Mortgage Payable-Due December 1, 2023		3,782,751			4,010,966
(d)ii.)	Mortgage Payable-Due August 17, 2023		1,476,600			1,577,600
(e)	Canada Emergency Business Account-Due December 31, 2023		73,830			78,880
(f)	Corporate Term Loan-Due April 7, 2025		89,659			133,584
			8,869,426			9,517,692
Current portion			(8,816,931	)		(7,765,421	)
Long-Term portion		$	52,495		$	1,752,271

On November 15, 2021 and March 15, 2022, the Company paid all arrears owing to PACE on each date and PACE agreed to allow the Company to continue payments to the end of the terms of each obligation, September 2022. Management has been in discussions with PACE to settle the Company's obligations to PACE. In addition, management continues to have discussions with equity investors and other creditors to repay outstanding obligations and accounts payable. In addition, the existing letter of credit, in the amount of $204,384 (C$276,831) provided by PACE will continue until a replacement is obtained, but, in no case later than September 30, 2023. The Company has been in discussions with its Canadian chartered bank to replace the PACE letter of credit for the new financial assurance with the Ministry of the Environment, Conservation and Parks (the "MECP") in the amount of $470,767 (C$637,637). On December 31, 2022, the Company is in arrears nine months for each of its obligations to PACE.

Refer also to going concern, note 2 and subsequent events, note 22(d).

The PACE long-term debt is payable as noted below:

(a)	The credit facility bears interest at the PACE base rate of 11% plus 1.25% per annum, currently 12.25%, is payable in monthly blended installments of principal and interest of $6,470 (C$8,764) and matured on September 2, 2022. The first and only advance on the credit facility on February 2, 2017, in the amount of $1,181,280 (C$1,600,000), is secured by a business loan general security agreement, a $1,181,280 (C$1,600,000) personal guarantee from the CEO and a charge against the Haute leased premises. Also pledged as security are the shares of the wholly owned subsidiaries, and a limited recourse guarantee against each of these parties. As noted above, the pledged shares were delivered by PACE and are currently held as security for the personal guarantee from the CEO and charge against the Haute leased premises. On April 3, 2020, the pledged shares were delivered by PACE and are currently held as security for the personal guarantee from the CEO and charge against the Haute leased premises.

(b)	The credit facility advanced on June 15, 2017, in the amount of $442,980 (C$600,000), bears interest at the PACE base of 11% plus 1.25% per annum, currently 12.25%, is payable in monthly blended installments of principal and interest of $3,618 (C$4,901), and matured on September 2, 2022. The credit facility is secured by a variable rate business loan agreement on the same terms, conditions and security as noted above.

(c)

The corporate term loan advanced on September 13, 2017, in the amount of $2,749,538 (C$3,724,147), bears interest at PACE base rate of 11% plus 1.25% per annum, currently 12.25%, is payable in monthly blended installments of principal and interest of $21,936 (C$29,711), and matured on September 13, 2022. The corporate term loan is secured by a business loan general security agreement representing a floating charge over the assets and undertakings of the Company, a first priority charge under a registered debenture and a lien registered under the Personal Property Security Act in the amount of $2,953,922 (C$4,000,978) against the assets including inventory, accounts receivable and equipment. The corporate term loan also included an assignment of existing contracts included in the asset purchase agreement.

For the year ended December 31, 2022, $357,038 (C$464,168) (2021-$318,714; C$399,391), in interest was incurred on the PACE long-term debt. As at December 31, 2022, $288,407 (C$390,636) (2021-$43,233; C$54,808) in accrued interest is included in accrued liabilities in the consolidated balance sheets.

(d)	i.)	The Company obtained a 1st mortgage provided by private lenders to finance the acquisition of the shares of 1684567 and to provide funds for additional financing needs, including additional lands, received in four tranches totaling $3,839,160 (C$5,200,000) (December 31, 2021-$4,101,760; C$5,200,000). The fourth tranche was received on August 13, 2021 in the amount of $1,402,770 (C$1,900,000) and a portion of this fourth tranche, $1,368,759 (C$1,853,933), was used to fund a portion of the purchase of the Hamilton Property, described under long-lived assets, net note 8. The 1st mortgage is repayable interest only on a monthly basis at an annual rate of the higher of the Royal Bank of Canada's prime rate plus 6.05% per annum (currently 12.50%) and 10% per annum with a maturity date of December 1, 2022. The Company continues to be charged at the rate of 10% per annum. The 1st mortgage payable is secured by the shares held of 1684567, a 1st mortgage on the premises located at 704 Phillipston Road, Roslin, Ontario, Canada and a general assignment of rents. Financing fees on the 1st mortgage totaled $318,217 (C$403,419). As at December 31, 2022 $31,555 (C$42,740) (December 31, 2021-$33,713; C$42,740) of accrued interest is included in accrued liabilities in the consolidated balance sheets. In addition, as at December 31, 2022 there is $56,409 (C$76,404) (December 31, 2021-$90,794; C$115,104) of unamortized financing fees included in long-term debt in the consolidated balance sheets.

	ii.)	On August 17, 2021, the Company obtained a vendor take-back 1st mortgage in the amount of $1,476,600 (C$2,000,000), on the purchase of the Hamilton Property, described under long-lived assets, net note 8. The 1st mortgage bears interest at an annual rate of 2% per annum, repayable monthly interest only with a maturity date of August 17, 2023, secured by the assets on the Hamilton Property.

For the year ended December 31, 2022, $430,772 (C$560,026) (2021-$308,101; C$385,978) in interest was incurred on the 1st mortgages payable.

(e)	As a result of the COVID-19 virus, the Government of Canada launched the Canada Emergency Business Account (the "CEBA"), a program to ensure that small businesses have access to the capital they need to see them through the current challenges and better position them to quickly return to providing services to their communities and creating employment. The program is administered by Canadian chartered banks and credit unions.

	The Company has received a total of $73,830 (C$100,000) under this program, from its Canadian chartered bank.

	Under the initial term date of the loans, which is detailed in the CEBA term loan agreements, the amounts were due on December 31, 2022 and were interest-free. If the loans were not repaid by December 31, 2022, the Company could have made payments, interest only, on a monthly basis at an annual rate of 5%, under the extended term date, beginning January 1, 2023, maturing December 31, 2025. The CEBA term loan agreements were amended by extending the interest free repayment date by one year to December 31, 2023. If paid by December 31, 2023, 33.33% ($24,610; C$33,333), previously 25%, of the loans would be forgiven. Repayment terms on the extended period are unchanged. The CEBA term loan agreements contain a number of positive and negative covenants, for which the Company is not in full compliance.

(f)	On April 8, 2021, the Company took delivery of a truck and hauling trailer for a total purchase price of $161,199 (C$218,338) plus applicable harmonized sales taxes. The purchase was financed by a bank term loan of $147,660 (C$200,000), over a forty-eight-month term, bearing interest at 4.95% per annum with monthly blended instalments of principal and interest payments of $3,618 (C$4,901) due April 7, 2025.

	For the year ended December 31, 2022, $5,500 (C$7,150) (2021-$5,355; C$6,711) in interest was incurred.