Discontinued Operations and Assets and Liabilities Held for Sale

6 Months Ended

Jun. 30, 2018

Discontinued Operations and Assets and Liabilities Held for Sale [Abstract]

Discontinued Operations and Assets and Liabilities Held for Sale

3.	Discontinued Operations and Assets and Liabilities Held for Sale

On January 29, 2018, the Company entered into a Legacy Asset Sale Agreement with Mark McLaughlin (the Company’s former President and CEO) whereby the Company sold the net assets of the legacy beta glucan business for $850,000. On February 7, 2018, the Company and Mr. McLaughlin entered into an amendment to the asset purchase agreement to amend the purchase price of the assets, whereby Mr. McLaughlin agreed, through a newly formed entity, to purchase the assets and liabilities of the yeast beta glucan manufacturing business, for the following: (i) 2,000,000 shares of the Company’s common stock (valued at $0.23 per share or $460,000), payable on February 12, 2018, (the “Closing Date”), (ii) $190,000 payable on the Closing Date, (iii) $200,000 payable within 120 days following the Closing Date, and (iv) the waiver of all rights to any severance payment in the amount of $150,000. The total purchase price per the amended asset sale agreement was $1,000,000. The total net assets and liabilities transferred in the sale was $255,248, resulting in a gain on sale of $744,752.

Operating results for the three months and six months ended June 30, 2018, and 2017 for the yeast beta glucan manufacturing business are presented as discontinued operations and the assets and liabilities classified as held for sale are presented separately in the balance sheet.

A breakdown of the discontinued operations is presented as follows:

	Three months ended				Six months ended
	June 30, 2018		June 30, 2017		June 30, 2018		June 30, 2017
Net Sales	$	-	$	447,331	$	363,613	$	703,894
Cost of Sales		-		144,148		56,666		259,331
Gross Profit		-		303,183		306,947		444,563
Operating expenses		-		148,358		125,960		262,931
Income from discontinued operations		-		154,825		180,987		181,632
Gain on sale		-		-		744,752		-
Net income from discontinued operations	$	-	$	154,825	$	925,739	$	181,632

Assets and liabilities of discontinued operations held for sale included the following:

	June 30, 2018		December 31, 2017
Current assets:
Trade accounts receivable, net	$	-	$	270,580
Inventory, net		-		25,903
	$	-	$	296,483

Current liabilities:
Accounts payable and accrued expenses	$	-	$	81,733
	$	-	$	81,733