Discontinued Operations

6 Months Ended

Jun. 30, 2022

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

5. Discontinued Operations

The Company held two hotel properties during 2021, each of which were classified as non-core assets and were sold or disposed of during 2021.

Clearday, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

During the quarter ended June 30, 2022, the Company sold one non-core asset:

Clearday sold on June 30, 2022 unimproved land of approximately 2 acres of property located in Cibolo, Texas that was held as non-core assets for an aggregate gross amount of $980,000. The sale of such land is part of our previously disclosed course of business to sell or otherwise monetize assets non-core assets, which are the assets (1) acquired by Clearday Operations, Inc. (formerly, Allied Integral United, Inc.), on December 31, 2018, when it began its business and that (2) are not related to our memory care facilities or our non-acute care and wellness industry.

On April 5, 2022, Leander Associates, Ltd., a Texas limited partnership (“Leander Seller”) also executed a Purchase and Sale Agreement with Leander Ridge, LLC, a Texas limited liability company (“Buyer”) to sell one of Clearday’s non-core assets: a land parcel located in Leander, Texas (the “Leander Property”) for a consideration of $392,040 per acre ($9.00/sf) of developable land, for an approximate total amount of $1,842,588 (the “Purchase Price”). The Sale Agreement provides a 90-day period following the April 4, 2022 effective date, or until July 5, 2022 (the “Feasibility Period”), for the purchaser to inspect the Leander Property and conduct their analysis, appraisals and other examination of the Leander Property, including environmental inspections. On June 29, 2022, the Leander Seller sold a 6% tenant in common interest in the Leander Property for approximately $43,000. Such purchaser will share in the net proceeds in the sale of the Leander Property on a pro rata basis.

The following statements are the unaudited condensed consolidated balance sheets and income statements for the Company’s discontinued operations:

	June 30, 2022		December 31, 2021
ASSETS
Current assets:
Cash and cash equivalents	$	-	$	-
Restricted cash		-		-
Accounts receivable		-		-
Prepaid expenses		-		-
Total current assets	$	-	$	-
Investments in non-consolidated entities		-		-
Note Receivables		-		-
Real estate, property and equipment, net		1,405,910		2,086,245
Total long-term assets held for sale		1,405,910		2,086,245
TOTAL ASSETS	$	1,405,910	$	2,086,245
LIABILITIES
Current liabilities:
Accounts payable			$	-
Accrued expenses	$	460,691		438,192
Accrued interest		-		-
Current portion of long-term debt		805,000		1,000,000
Total current liabilities		1,265,691		1,438,192
Long-term liabilities:
Note payable		421,470		487,678
Long-term debt, less current portion		218,617		225,169
Total long-term liabilities held for sale		640,087		712,847
TOTAL LIABILITIES	$	1,907,778	$	2,151,039

Clearday, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

	Six Months Ended June 30,
	2022			2021
REVENUES
Commercial property rental revenue	$	(42,986	)	$	(42,359	)
Total revenues, net		(42,986	)		(42,359	)
Costs and expenses
Operating expenses		45,355			72,754
General and administrative expenses		21,033			328,684
Total operating expenses	$	66,388		$	401,438
Loss from operations		(23,402	)		(359,077	)
Other/(income) expenses
Interest expense		147,578			162,599
Gain on disposal of assets					15,000
Equity income from investees, net of applicable taxes					-
Impairment expense (recovery)					(811,061	)
Other (income) expenses					(357,859	)
Total (income)/expense		147,578			(991,321	)
Net loss	$	(170,980	)	$	632,244