Leases

12 Months Ended

Dec. 31, 2021

Leases [Abstract]

Leases

10. Leases

The Company acquired ATHI on July 1, 2021, ATHI’s wholly owned subsidiary had entered into an operating lease agreement for certain real property located at 1590 S. Congress Avenue, West Palm Beach, Florida, with effect from February 1, 2019 for a period of three years, expiring on 1 February 2022. Under the terms of the lease agreement, the lease was extended during October 2021 for a further 5 year period until 1 February 2027.

To determine the present value of minimum future lease payments for operating leases at February 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 average of (i) the five year ARM interest rate as quoted by Freddie Mac adjusted for a risk premium of 20%. The Company determined that 4.64% per annum was an appropriate incremental borrowing rate to apply to its real-estate operating lease.

 
Right of use assets are included in the consolidated balance sheet are as follows:

Schedule of Right of use assets
	December 31, 2021		December 31, 2020
Non-current assets
Right-of-use assets – finance leases, net of depreciation, included in Property and equipment	$	49,268	$	—
Right-of-use assets - operating leases, net of amortization	$	1,653,816	$	—

Lease costs consists of the following: 

Schedule of Lease costs
	Year ended December 31,
	2021		2020
Finance lease cost:
Amortization of right-of-use assets	$	6,681	$	—
Interest expense on finance lease liabilities		1,367		—
	8,048		—
Operating lease cost	$	178,679	$	5,512
Lease cost	$	186,727	$	5,512

Other lease information: 

Schedule of Other lease
	Year ended December 31,
	2021			2020
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from finance leases	$	(1,367	)	$	—
Operating cash flows from operating leases		(160,272	)		(5,512	)
Financing cash flows from finance leases		40,281			—
Cash paid for amounts included in the measurement of lease liabilities	$	(121,358	)	$	(5,512	)
Weighted average lease term – finance leases		4 years and ten months			—
Weighted average remaining lease term – operating leases		5 years and 1 months			—
Discount rate – finance leases		6.61	%		—
Discount rate – operating leases		4.64	%		—	%

Maturity of Leases

Finance lease liability

The amount of future minimum lease payments under finance leases as of December 31, 2021 is as follows:

Schedule of Finance lease liability
	Amount
2022	$	9,829
2023		9,829
2024		9,829
2025		9,829
2026		7,902
	47,218
Imputed interest		(6,937	)
Total finance lease liability	$	40,281
Disclosed as:
Current portion	$	7,386
Non-Current portion		32,895
Lease liability	$	40,281

Operating lease liability

The amount of future minimum lease payments under operating leases are as follows:

Schedule of Operating lease liability
	Amount
2022	$	332,073
2023		348,677
2024		366,110
2025		384,416
2026		437,407
Total undiscounted minimum future lease payments		1,868,683
Imputed interest		(134,169	)
Total operating lease liability	$	1,734,514
Disclosed as:
Current portion	$	241,083
Non-Current portion		1,493,431
Lease liability	$	1,734,514