Form S-8 Novo Integrated Sciences



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AS
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 19, 2021

 

Registration
Statement No. 333-________

 

 

UNITED
STATES

SECURITIES
AND EXCHANGE COMMISSION

WASHINGTON,
D.C. 20549

 

FORM
S-8

REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OF 1933

 

NOVO
INTEGRATED SCIENCES, INC.

(Exact
name of registrant as specified in its charter)

 

Nevada
 
59-3691650(State
or other jurisdiction of
incorporation or organization)

 
(I.R.S.
Employer
Identification No.)

 

11120
NE 2nd Street, Suite 100

Bellevue,
WA

 
98004(Address
of Principal Executive Offices)

 
(Zip
Code)

 

Novo
Integrated Sciences, Inc. 2021 Equity Incentive Plan

Novo
Integrated Sciences, Inc. Non-Plan Based Shares

(Full
title of the plan)

 

Robert
Mattacchione

Chief
Executive Officer

Novo
Integrated Sciences, Inc.

11120
NE 2nd Street, Suite 100

Bellevue,
WA 98004

(Name
and address of agent for service)

 

(206)
617-9797

(Telephone
number, including area code, of agent for service)

 

Indicate
by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting
company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,”
“smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large
accelerated filer [  ]

Accelerated
filer [  ]
Non-accelerated
filer [X]

Smaller
reporting company [X]
 
Emerging
growth company [  ]

 

If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for
complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act.
[  ]

 

CALCULATION
OF REGISTRATION FEE 

 

Title of securities to be registered
 
Amount to be registered (1)
 
Proposed maximum offering price per share (2)
 
 
Proposed maximum aggregate offering price (2)
 
 
Amount of registration fee (3)
 Common Stock, par value $0.001 per share
 
4,500,000 shares
(4)
$
3.22
 
 
$
14,490,000.00
 
 
$
1,580.86
 Common Stock, par value $0.001 per share
 
1,772,000 shares
(5)
$
3.22
 
 
$
5,705,840.00
 
 
$
622.51
 Total
 
6,272,000 shares
 
 
 
 
 
$
20,195,840.00
 
 
$
2,203.37
 

 

(1)
Pursuant to Rule 416(a) under the Securities Act of 1933, as amended (the “Securities Act”), this registration statement
also covers any additional securities that may from time to time be offered or issued in respect of the securities registered
by this registration statement as a result of any stock dividend, stock split, recapitalization or other similar transaction.

 

(2)
Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(c) and Rule 457(h) under the Securities
Act. Based on the average of high ($3.50) and low ($2.94) sale price of the issuer’s common stock, par value
$0.001 per share (“Common Stock”), as quoted on the OTCQB tier of the OTC Markets on February 17, 2021, which
date is within five business days prior to filing this registration statement.

 

(3)
Determined in accordance with Section 6(b) of the Securities Act at a rate equal to $109.10 per $1,000,000 of the proposed maximum
aggregate offering price.

 

(4)
This registration statement covers an aggregate of 4,500,000 shares of Common Stock available for issuance under the Novo Integrated
Sciences, Inc. 2021 Equity Incentive Plan.

 

(5)
This registration statement also covers the resale of 1,772,000 shares of Common Stock underlying stock options previously granted,
pursuant to written stock option agreements, to the selling stockholders named in this registration statement in exchange for
bona fide services provided by the selling stockholders to the issuer.

 

 

 

EXPLANATORY
NOTE

 

Novo
Integrated Sciences, Inc. (the “Company”) has prepared this registration statement on Form S-8 (the “Registration
Statement”) in accordance with the requirements of Form S-8 under the Securities Act of 1933, as amended (the “Securities
Act”), (i) for the purpose of registering 4,500,000 shares of the Company’s common stock, par value $0.001 per share
(“Common Stock”), available for issuance under the Novo Integrated Sciences, Inc. 2021 Equity Incentive Plan (the
“2021 Plan”), and (ii) for the purpose of resale or reoffer thereof, 1,772,000 shares of Common Stock issuable upon
exercise of stock options previously granted to the selling stockholders named in this registration statement in exchange for
bona fide services provided by the selling stockholders to the issuer and pursuant to written stock option agreements.

 

This
Registration Statement contains two parts, Part I and Part II.

 

Part
I contains a “reoffer” prospectus prepared in accordance with Part I of Form S-3 (in accordance with Instruction C
of the General Instructions to Form S-8). The reoffer prospectus permits reoffers and resales of those shares referred to above
that constitute “restricted securities,” within the meaning of Form S-8, by the selling stockholder named herein.
Certain information relating to future issuances under the 2021 Plan is omitted from Part I, as further described below in the
next paragraph and under the heading, “Item 1. Plan Information.”

 

Part
II contains information required to be set forth in the Registration Statement pursuant to Part II of Form S-8. Pursuant to the
Note to Part I of Form S-8, the 2021 Plan information specified by Part I of Form S-8 is not required to be filed with the Securities
and Exchange Commission.

 

The
Company will provide, without charge, to any person, upon written or oral request of such person, a copy of each document incorporated
by reference in Item 3 of Part II of this Registration Statement (which documents are also incorporated by reference in the reoffer
prospectus as set forth in Form S-8), other than exhibits to such documents that are not specifically incorporated by reference.

 

 

Part
I

 

INFORMATION
REQUIRED IN THE SECTION 10(a) PROSPECTUS

 

Item
1. Plan Information

 

The
documents containing the information in Part I relating to the Novo Integrated Sciences, Inc. 2021 Equity Incentive Plan (the
“2021 Plan”) will be sent or given to participants in the 2021 Plan as specified by Rule 428(b)(1) promulgated under
the Securities Act. In accordance with the instructions to Part I of Form S-8, such documents will not be filed with the Securities
and Exchange Commission either as part of this Registration Statement or as prospectuses or prospectus supplements pursuant to
Rule 424 promulgated under the Securities Act. These documents and the documents incorporated by reference pursuant to Item 3
of Part II of this Registration Statement, taken together, constitute the prospectus that meets the requirements of Section 10(a)
of the Securities Act (the “Section 10(a) Prospectus”) in respect of future issuances under the 2021 Plan.

 

Item
2. Registrant Information and Employee Plan Annual Information

 

Upon
written or oral request, any of the documents incorporated by reference in Item 3 of Part II of this Registration Statement, which
are also incorporated by reference in the Section 10(a) Prospectus, other documents required to be delivered to eligible participants
pursuant to Rule 428(b) promulgated under the Securities Act, or additional information about the 2021 Plan, will be made available
without charge by contacting our Corporate Secretary, c/o Novo Integrated Sciences, Inc., 11120 NE 2nd Street, Suite 100, Bellevue,
WA 98004.

 

 

REOFFER
PROSPECTUS

 

1,772,000
SHARES

NOVO
INTEGRATED SCIENCES, INC.

COMMON
STOCK

 

This
prospectus relates to 1,772,000 shares (the “Shares”) of common stock, par value $0.001 per share, of Novo Integrated
Sciences, Inc. (“Novo,” the “Company,” “we” or “our”) issuable upon exercise of
stock options previously granted to the selling stockholders named in this prospectus, some of whom are deemed to be our “affiliates,”
as that term is defined in Rule 405 under the Securities Act of 1933, as amended (the “Securities Act”), and which
may be offered from time to time by the selling stockholders of the Company, named herein, for such stockholders’ own accounts.
The stock options were previously granted to the selling stockholders in exchange for bona fide services provided by the selling
stockholders to the issuer and pursuant to written stock option agreements. We will not receive any proceeds from any sale of
common stock offered pursuant to this prospectus. To the extent the options are exercised for cash, if at all, we will receive
the exercise price for the options.

 

The
selling stockholders may offer and sell the Shares at various times and in various types of transactions, including sales in the
open market, sales in negotiated transactions and sales by a combination of these methods. The Shares may be sold at the market
price of our common stock at the time of a sale, at prices relating to the market price over a period of time, or at prices negotiated
with the buyers of shares. The Shares may be sold through underwriters or dealers which the selling stockholder may select. If
underwriters or dealers are used to sell the Shares, we will name them and describe their compensation in a prospectus supplement.
For a description of the various methods by which the selling stockholder may offer and sell the Shares described in this prospectus,
see the section entitled “Plan of Distribution.”

 

Our
common stock is quoted on the OTCQB tier of the OTC Markets under the symbol “NVOS.” On February 1, 2021, we effected
a 1-for-10 reverse split of our common stock. Share amounts in this prospectus have been adjusted to give effect to this reverse
stock split. Beginning on February 1, 2021, our common stock began trading on a post-split basis under the symbol “NVOSD.”
On March 2, 2021 (the 21st business day following the reverse stock split), our common stock will return to trading
under the symbol “NVOS.” On February 17, 2021, the closing price of our common stock was $3.49.

 

THE
SHARES BEING OFFERED ARE SPECULATIVE AND INVOLVE A HIGH DEGREE OF RISK. THEY SHOULD BE CONSIDERED ONLY BY PERSONS WHO CAN AFFORD
THE LOSS OF THEIR ENTIRE INVESTMENT. SEE “RISK FACTORS” BEGINNING ON PAGE 35 OF THIS PROSPECTUS FOR A DISCUSSION OF
INFORMATION THAT SHOULD BE CONSIDERED IN CONNECTION WITH AN INVESTMENT IN OUR SECURITIES.

 

NEITHER
THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR
PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

 

You
should rely only on the information contained in this prospectus. We have not, and the selling stockholders have not, authorized
anyone to provide you with different information from that contained in this prospectus or in any free writing prospectus that
we may authorize. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless
of the time of delivery of this prospectus or of any sale of our common stock. This prospectus does not constitute an offer to
sell, or a solicitation of an offer to buy the securities in any circumstances under which the offer or solicitation is unlawful.
Neither the delivery of this prospectus nor any distribution of securities in accordance with this prospectus shall, under any
circumstances, imply that there has been no change in our affairs since the date of this prospectus.

 

The
date of this prospectus is February 19, 2021.

 

 

TABLE
OF CONTENTS 

 

 

 

CAUTIONARY
NOTE REGARDING FORWARD-LOOKING STATEMENTS
AND RISK FACTOR SUMMARY

 

Some
of the statements contained in this prospectus may constitute “forward-looking statements” for purposes of the federal
securities laws. Our forward-looking statements include, but are not limited to, statements regarding our or our management team’s
expectations, hopes, beliefs, intentions or strategies regarding the future. In addition, any statements that refer to projections,
forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking
statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,”
“expect,” “intend,” “may,” “might,” “plan,” “possible,”
“potential,” “predict,” “project,” “should,” “would” and similar expressions
may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking.

 

The
forward-looking statements contained in this prospectus are based on our current expectations and beliefs concerning future developments
and their potential effects on us. There can be no assurance that future developments affecting us will be those that we have
anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control)
or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by
these forward-looking statements. These risks and uncertainties include, but are not limited to, the following risks, uncertainties
and other factors:

 

We
have a history of operating losses;
We
may not be able to implement successfully our growing our multidisciplinary primary health
care business by opening and acquiring new clinics and expanding the staffing of multidisciplinary
primary health care clinicians to affiliate clinics and eldercare centric homes;
Public
health epidemics or outbreaks (such as the novel strain of coronavirus (COVID-19)) could
adversely impact our business;
We
may not be able to increase our market share in existing eldercare services, occupational
therapy services, physiotherapy services and speech language pathology services through
network affiliation growth and new contracts;
We
may be unable to attract sufficient demand for and obtain acceptance of our multidisciplinary
primary health care services and our medical cannabidiol products by both multidisciplinary
primary health care clinicians and patients;
The
clinics that we acquire or open may not meet our expectations;
If
we open new clinics in existing markets, revenue at our existing clinics may be affected
negatively;
The
multidisciplinary primary health care market is highly competitive, including competition
for patients, strategic relationships, and commercial payor contracts, each of which
could adversely affect our contract and revenue base;
We
may be unable to obtain reimbursement for our multidisciplinary primary health care services
from the government or third-party health care insurers of our patients;
We
may not be able to successfully make acceptable financial arrangements for patients who
desire treatment but cannot afford to pay in full or part, and for whom third-party insurance
coverage is either limited or non-existent;
Prospective
patients may be unwilling to pay out-of-pocket for certain of our multidisciplinary primary
health care and primary care services, in the absence of reimbursement from the government
or third-party health care insurers for such multidisciplinary primary health care and
services;
The
success of alternative treatments, therapies and medical products as opposed to the multidisciplinary
primary health care services, therapies and medical CBD products that we offer could
adversely affect us;
We
may not be able to recruit and retain qualified multidisciplinary primary health care
clinicians for our multidisciplinary primary health care clinics and staffing of affiliate
clinics and eldercare centric homes;
We
may not be able to prohibit or limit our multidisciplinary primary health care clinicians
from competing with us in our local markets;
We
may be unable to enter into or maintain contracts for our multidisciplinary primary health
care services on favorable terms with commercial payors in Canada and the United States;
Government
health care programs may reduce reimbursement rates;

 

 

The
health care industry is heavily regulated, and if we fail to comply with these laws and
governmental regulations, we could incur penalties or be required to make significant
changes to our operations;
Our
multidisciplinary primary health care clinics are and will be subject to numerous statutes
and regulations in the Canadian provinces in which we operate or intend to operate and
states in the United States in which we intend to operate. Failure to comply with these
laws and regulations could result in civil or criminal sanctions;
Past
and future health care reform legislation and other changes in the health care industry
could adversely affect our business, financial condition and results of operations;
We
are subject to the Canada Health Act, Canada’s National Health Insurance Program
and Food and Drugs Act and analogous provisions of applicable federal, provincial, state
and local laws and could face substantial penalties if we fail to comply with such laws;
If
the Company acquires one or more multidisciplinary primary health care clinics or primary
care facilities in the United States, we will be subject to the Anti-Kickback Statute,
FCA, Civil Monetary Penalties statute and analogous provisions of applicable state laws
and could face substantial penalties if we fail to comply with such laws;
We
will be subject to the data privacy, security and breach notification requirements of
Canadian and United States federal statutes and other data privacy and security laws,
and the failure to comply with these rules, or allegations that we have failed to do
so, could result in civil or criminal sanctions;
Our
telemedicine platform is currently under development and we may be unsuccessful in the
commercialization of the telemedicine platform;
Our
success with the telemedicine platform will highly be dependent upon our ability to develop
relationships with primary care physicians and specialists;
Our
telemedicine platform may not be accepted in the marketplace;
Our
Remote Patient Monitoring platform is currently in early-stage roll-out and development
and we may be unsuccessful in the commercialization of the RPM platform;
Our
success with the Remote Patient Monitoring platform will highly be dependent upon our
ability to develop relationships with primary care physicians and specialists;
Our
Remote Patient Monitoring platform may not be accepted in the marketplace;
Government
regulation of the internet and e-commerce is evolving, and unfavorable changes could
substantially harm our business and results of operations;
We
may be unable to attract sufficient demand for and obtain acceptance of our medical CBD
products by both multidisciplinary primary health care clinicians and patients;
Possible
yet unanticipated changes in federal and state law could cause any products that we intend
to launch, containing hemp-derived CBD oil to be illegal, or could otherwise prohibit,
limit or restrict any of our products containing CBD;
Risks
associated with the CBD products industry;
FDA
regulation could negatively affect the hemp industry, which would directly affect our
financial condition;
Sources
of hemp-derived CBD depend upon legality of cultivation, processing, marketing and sales
of products derived from those plants under state law of the United States;
Because
our distributors may only sell and ship our products containing hemp-derived CBD in states
that have adopted laws and regulations qualifying under the 2018 Farm Act, a reduction
in the number of states having such qualifying laws and regulations could limit, restrict
or otherwise preclude the sale of intended products containing hemp-derived CBD;
There
may be unanticipated delays in the development and introduction of our future medical
CBD products and/or our inability to control costs;
We
may be unable to consistently retain or hire third-party manufacturers, suppliers or
other service providers to produce our medical CBD products;
We
do not have control over all third parties involved in the manufacturing of our products
and their compliance with government health and safety standards. Even if our products
meet these standards, they could otherwise become contaminated;
The
sale of our products involves product liability and related risks that could expose us
to significant insurance and loss expenses;
Confusion
between legal CBD and illegal cannabis;
Seasonal
fluctuations in revenue;
Our
failure to promote and maintain a strong brand;
Failure
to achieve or sustain profitability;
Our
failure to successfully or cost-effectively manage our marketing efforts and channels,
and the failure of such efforts and channels to be effective in generating leads and
business for the Company or any of its affiliated providers;
Significant
competition;
Adequate
protection of confidential information;
The
business risks of United States and international operations;
Our
vulnerability to changes in consumer preferences and economic conditions;
Potential
litigation from competitors and health related claims from patients and customers;
A
limited market for our common stock;
Our
ability to adequately protect the intellectual property used to produce our medical CBD
products; and
Our
ability to stay abreast of modified or new laws and regulations applying to our business.

 

Should
one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may
vary in material respects from those projected in these forward-looking statements. We undertake no obligation to update or revise
any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required
under applicable securities laws.

 

 

THE
COMPANY

 

Business
Overview

 

Novo
Integrated Sciences, Inc. was incorporated in Delaware on November 27, 2000, under the name Turbine Truck Engines, Inc. On February
20, 2008, the Company was re-domiciled to the State of Nevada. Effective July 12, 2017, the Company’s name was changed to
Novo Integrated Sciences, Inc. When used herein, the terms “Company,” “we,” “us,” and “our”
refer to Novo Integrated Sciences, Inc. and its consolidated subsidiaries.

 

The
Company owns Canadian and U.S. subsidiaries which deliver, or intend to deliver, multidisciplinary primary health care related
services and products through the integration of medical technology, advanced therapeutics and rehabilitative science. Currently,
the Company’s revenue is generated solely through its wholly owned Canadian subsidiary, Novo Healthnet Limited (“NHL”),
which provides our services and products through both clinic and eldercare related operations.

 

Our
clinicians and practitioners provide certain multidisciplinary primary health care services, and related products, beyond the
medical doctor first level contact identified as primary care. Our clinicians and practitioners are not licensed medical doctors,
physicians, specialist, nurses or nurse practitioners. Our clinicians and practitioners are not authorized to practice primary
care medicine and they are not medically licensed to prescribe pharmaceutical based product solutions.

 

NHL’s
team of multidisciplinary primary health care clinicians and practitioners provide assessment, diagnosis, treatment, pain management,
rehabilitation, education and primary prevention for a wide array of orthopedic, musculoskeletal, sports injury, and neurological
conditions across various demographics including pediatric, adult, and geriatric populations through NHL’s 16 corporate-owned
clinics, a contracted network of 103 affiliate clinics, and 218 eldercare related long-term care homes, retirement
homes, and community-based locations in Canada. 

 

Additionally,
we continue to expand our patient care philosophy of maintaining an on-going continuous connection with our patient community,
beyond the traditional confines of brick and mortar facilities, by extending oversight of patient diagnosis, care and monitoring,
directly through various Medical Technology Platforms either in-use or under development.

 

Our
specialized multidisciplinary primary health care services include physiotherapy, chiropractic care, manual/manipulative therapy,
occupational therapy, eldercare, massage therapy (including pre- and post-partum), acupuncture and functional dry needling, chiropody,
stroke and traumatic brain injury/neurological rehabilitation, kinesiology, vestibular therapy, concussion management and baseline
testing, trauma sensitive yoga and meditation for concussion-acquired brain injury and occupational stress-PTSD, women’s
pelvic health programs, sports medicine therapy, assistive devices, dietitian, holistic nutrition, fall prevention education,
sports team conditioning programs including event and game coverage, and private personal training.

 

The
occupational therapists, physiotherapists, chiropractors, massage therapists, chiropodists and kinesiologists contracted, by NHL,
to provide occupational therapy, physical therapy and fall prevention assessment services are registered with the College of Occupational
Therapists of Ontario, the College of Physiotherapists of Ontario, College of Chiropractors of Ontario, College of Massage Therapists
of Ontario, College of Chiropodists of Ontario, and the College of Kinesiologists of Ontario regulatory authorities.

 

Our
strict adherence to public regulatory standards, as well as self-imposed standards of excellence and regulation, have allowed
us to navigate with ease through the industry’s licensing and regulatory framework. Compliant treatment, data and administrative
protocols are managed through a team of highly trained, certified health care and administrative professionals. We and our affiliates
provide service to the Canadian property and casualty insurance industry, resulting in a regulated framework governed by the Financial
Services Commission of Ontario.

 

Eldercare

 

The
Company’s eldercare related operations provide physiotherapy (“PT”), occupational therapy (“OT”),
assessment and application assistance for assistive devices, fall prevention programs, community-based strengthening and general
flexibility exercise classes, rehabilitative strategies and continuing education to eldercare clients, including caregivers and
family members as applicable, in various long-term care homes, retirement homes and community-based locations across the province
of Ontario, Canada.

 

 

As
a result of NHL’s September 2013 asset acquisition of Peak Health LTC Inc, an Ontario corporation formed in 2006, NHL has
a 14-year history of providing certain multidisciplinary related healthcare services and products to the eldercare community.
In 2017, based on the philosophical overlap and synchronicity between PT and OT, NHL launched its occupational therapy sector
of services for our eldercare clients. NHL’s eldercare focused OT and PT services and product are in direct competition
with the top providers in this sector. We offer one of the most extensive rosters of OT and PT clinicians certified by the Ministry
of Health for assistive device assessment under the Assistive Device Program which, when the individual meets the criteria, allows
our eldercare clients access to significant funding subsidies to purchase varying mobility aids (such as walkers, wheelchairs,
seating, and power wheelchairs/scooters).

 

Additionally,
our proprietary Electronic Rehabilitation Record and Management Reporting software solution provides us the ability to deliver
each eldercare facility with a wide-array of detailed PT and OT reports that include, among other things: (i) client specific
treatment details, (ii) identifying cost and optimization possibilities, (iii) outlining a wide variety of client outcome measurements,
(iv) analyzing overall contract effectiveness, and (v) producing indicators which assist the NHL team to target opportunities
for improved team efficiency. This software comes with an ability to provide a graphically illustrated ‘report card’
for contribution to annual, interdisciplinary care conferences with staff and family members, as well as fall reporting capacities,
which are central to many homes’ fall prevention committee meetings. Additionally, data generated by the software allows
members from both the NHL team and the eldercare facility team to identify residents who fall frequently and allow for the inter-disciplinary
team to put strategies in place to better reduce a resident’s “fall-risk”.

 

NHL
has created and delivers, through online virtual technology, a variety of eldercare related educational in-service programs which
include topics such as nursing restorative education, back education and other eldercare-relevant topics such as osteoporosis,
fall prevention, wheelchair positioning, and least restraints. NHL has designed its virtual online education in-service programs
and modules to be presented in a variety of formats to facilitate the different capacity and styles of learning common to senior-aged
individuals.

 

Our
eldercare PT services are provided as follows:

 

 
1.
Long-Term
Care Homes. NHL contracts with long-term care homes to provide individualized, onsite PT and group exercise classes for
its residents. Registered physiotherapists are assisted by on-site support personnel to deliver individualized care, based
on assessed needs, and with a goal of assisting each resident to attain and maintain their highest level of function possible
with their activities of daily living. These services are primarily funded by the Ontario Ministry of Health and Long-Term
Care (“MOHLTC”). The NHL team assists in providing assistive device assessments allowing residents access to funding
assistance for varying mobility aids (such as walkers, wheelchairs, seating, and power wheelchairs/scooters). In addition
to providing PT services, our team assists the long-term care home’s interdisciplinary team in the homes’ annual
care conferences with its residents. Through the provision of education regarding nursing restorative programming, our team
assists the facilities’ team in back education, fall prevention and many other subjects related to PT or physical health
and wellness. The NHL team works together with the interdisciplinary team to assist with mandatory coding of Canada’s
Resident Assessment Instrument Minimum Data Set (“RAI-MDS”) which is the standardized assessment tool required
for the home to access payment from the MOHLTC for each resident. Additionally, through NHL’s proprietary software,
the homes have access to abundant reporting solutions to help provide objective and quantitative measures for their continuous
quality improvement program. NHL’s proprietary software provides our eldercare client locations with the unique ability
to login and access multiple data points related to a multitude of therapy services provided to its residents, allowing for
detailed, rapid reporting and accountability.

 

 
2.
Retirement
Homes. We contract with client retirement homes to provide individualized PT and group exercise classes to the retirement
homes’ residents. Registered physiotherapists are assisted by the onsite support personnel to deliver individualized
care based on assessed needs, again with a goal of assisting the residents participating in therapy to attain and maintain
their level of function related to the activities of daily living. These services are partially funded by the individual and
partly funded by the MOHLTC. Similar to the long-term care sector, our team assists with education of the nursing/interdisciplinary
team, provides in depth service reports to the homes to measure desired service delivery and our proprietary software allows
for each retirement home to have the same unique login capacity. In addition to the services above, some of the residents
in the retirement homes, and as applicable the resident’s family members, can request and authorize receiving an increased
level of physiotherapy related services available privately on a fee-for-service basis paid by the individual.

 

 

 
3.

Community
Based Home Care Physiotherapy. Throughout the province of Ontario, the MOHLTC operates
14  Local Health Integration Networks (“LHINs”) which are health authorities
responsible for regional administration of public health care services. The LHINs serve
as contact points, information clearinghouses, referral resources, and assessment/care
coordinators for eligible residents who need health care assistance at home or a safer
place to live through aging at home strategies that can be put in place by health care
providers. Through service contracts, the LHINs engage “cluster providers”
to provide services to clients living in the community, clients living at-home or clients
living in a retirement home. These service contracts are funded by the MOHLTC.

 

NHL
is a “cluster provider” sub-contractor for home care physiotherapy in the North East LHIN which encompasses
more than 565,000 people across 400,000 square kilometers and five sub-regions . Through this subcontract arrangement,
we provide one-on-one physiotherapy assessment and treatment to clients who cannot easily access outpatient services due
to mobility challenges. Primarily, these clients are elderly with multiple co-morbidities, although some clients are not
elderly and are instead simply post-operative with mobility challenges.

 
 
  
4.

Community
Based Group Exercise Classes & Fall Prevention Programs. NHL has contracted with
two “cluster providers”  to provide group exercise classes and fall
prevention programs (consisting of an assessment accompanied by education and group exercise
classes) in three separate LHINs (Central, Toronto Central and Central East) which encompass
the Greater Toronto area with an estimated aggregate population of 6.4 million
 people. In 2013, the MOHLTC introduced several initiatives designed to assist seniors
in maintaining an active and healthy lifestyle while still living at home. Under the
2013 initiative, exercise instructors under contract with NHL, deliver group exercise
classes over a 48-week period each year.

 

In
addition, another component of the 2013 MOHLTC initiative is the delivery of fall prevention programs with entry and exit
assessments completed by specialized registered providers such as kinesiologists and physiotherapists with the assistance
of exercise instructors for the group class and education portion of the program. The goal of these classes is to assess
seniors’ general health status, identify defined levels of risk pertaining to balance and falling, and educate seniors
about fall prevention through a combination of increased knowledge and teaching exercises designed to improve strength
and balance.

 

 
5.
Community-based
Outpatient Clinics. NHL provides outpatient physiotherapy, chiropractic, and laser technology services through a community-based
clinic in the province of Ontario. The services provided at the clinic are funded by Motor Vehicle Accident treatment plans,
extended health benefits insurance coverage, or private payment. A portion of the services provided at the clinic are funded
by the MOHLTC in the form of Episodes of Care and these services are specifically targeted to be delivered to clients who
meet the following criteria:

 

 

Aged
65 years of age and older or aged 18 years of age and younger, and
 

Are
post-operative, or
 

Have
just been discharged from a hospital, or
 

Are
receiving services from the Ontario Disability Services Program or Ontario Works.

 

 

Our
eldercare OT services are provided, through two separate sectors, as follows:

 

 
1.
Long-Term
Care Sector. We contract with client homes to provide the following OT services:

 

 

Assessments
and interventions to support maintenance and restoration of function related to seating, mobility, positioning for self-care,
prevention of pressure ulcers, falls and use of restraints,
 

Speech
language pathology services, including evaluation and treatment,
 

Swallowing
and eating assessments and interventions,
 

Cognitive
behavioral assessments and care planning,
 

Our
occupational therapists have specialized training in mobility providing assistive device assessments when required. This service
is funded primarily by the MOHLTC.

 

 
2.
Retirement
Home & Community. We provide the following OT services through individual contracts with private payers:

 

 

Home
safety assessments,
 

Functional
assessments,
 

In-home
activities of daily living assessments,
 

Assessment
and completion of applications for assistive devices (mobility aids),
 

Custom
seating and mobility consultations,
 

Case
management services, and
 

Speech
language pathology services, including evaluation and treatment.

 

Recent
Developments

 

Coronavirus
(COVID-19)

 

In
December 2019, a novel strain of coronavirus (COVID-19) emerged in Wuhan, Hubei Province, China. While initially the outbreak
was largely concentrated in China and caused significant disruptions to its economy, it has now spread to several other countries
and infections have been reported globally.

 

On
March 17, 2020, as a result of COVID-19 infections having been reported throughout both Canada and the United States, certain
national, provincial, state and local governmental issued proclamations and/or directives aimed at minimizing the spread of COVID-19.
Accordingly, on March 17, 2020, the Company closed all corporate clinics for all in-clinic non-essential services to protect the
health and safety of its employees, partners and patients. On March 20, 2020, the Company announced the precautionary measures
taken as well as announcing the business impact related to the coronavirus (COVID-19) pandemic.

 

Operating
under COVID-19 related governmental proclamations and directives, between March 17, 2020 and June 1, 2020, the Company provided
in-clinic multi-disciplinary primary healthcare services and products solely to patients with emergency and essential need while
also providing certain virtual based services related to physiotherapy. In light of most eldercare related services being deemed
essential by national, provincial and local governmental authorities in Canada, NHL’s contracted eldercare related services
have been nominally impacted during the fiscal third quarter and we project the same for the fiscal fourth quarter.

 

On
May 26, 2020, the Ontario Ministry of Health announced updated guidance and directives stating that physiotherapists, chiropractors
and other regulated health professionals, including all services and products provided by the Company, can gradually and carefully
begin providing all services, including non-essential services, once the clinician and provider are satisfied all necessary precautions
and protocols are in place to protect the patients, the clinician and the clinic staff. With all corporate clinics closed due
to the COVID-19 pandemic, with the exception of providing certain limited essential and emergency services, the Company had furloughed
48 full-time employees and 35 part-time employees from its pre-closure levels of 81 full-time employees and 53 part-time employees.

 

On
June 2, 2020, the Company commenced opening its corporate clinics and providing non-essential services. As of June 9, 2020, the
Company had opened all corporate clinics while following all mandated guidelines and protocols from Health Canada, the Ontario
Ministry of Health, and the respective disciplines’ regulatory Colleges to ensure a safe treatment environment for our staff
and clients. Certain of these guidelines and protocols include both active and passive screening for staff and clients, enhanced
cleaning measures using only Health Canada approved disinfectants and sanitizers, personal protective equipment usage, appropriate
signage and markers throughout the clinics, and layout changes to the clinics to reflect proper physical distancing measures.
Additional, more restrictive proclamations and/or directives may be issued in the future.

 

 

With our clinic facilities re-opened and our
eldercare contracts operating under COVID-19 pandemic related mandated guidelines and protocols, for the month ended January
31, 2021, NHL’s clinic-based patient flow has met and exceeds 82% for the same period in 2020. In addition,
for the month ended January 31, 2021 NHL’s eldercare contract services provided has met and exceeds 93% for
the same period in 2020. As of January 31, 2021, the Company has 78 full-time employees and 59 part-time
employees.

 

Based
on no additional “lockdowns” or new material directives are implemented limiting the Company’s ability to provide
both its clinic and eldercare community related services, for fiscal year 2021 the Company projects a steady month-over-month
increase as (i) recommended guidelines for patient-clinician on-site interaction are eased, and (ii) more overall movement restrictions
are reduced and people are more comfortable in public spaces.

 

The
ultimate impact of the COVID-19 pandemic on the Company’s operations remains unknown and will depend on future developments,
which are highly uncertain and cannot be predicted with confidence, including the duration of the COVID-19 outbreak, new information
which may emerge concerning the severity of the COVID-19 pandemic, and any additional preventative and protective actions that
governments, or the Company, may direct, which may result in an extended period of continued business disruption, reduced patient
traffic and reduced operations. The full long-term financial impact cannot be reasonably estimated at this time but is anticipated
to have a material adverse impact on our business, financial condition, and results of operations.

 

The
measures taken to date will impact the Company’s fiscal year 2021 business and potentially beyond. Management expects that
all of its business segments, across all of its geographies, will be impacted to some degree, but the significance of the full
impact of the COVID-19 outbreak on the Company’s business and the duration for which it may have an impact cannot be determined
at this time.

 

Return
of Acquisition Deposit

 

On
June 12, 2020, the Company terminated an acquisition letter of intent (“LOI”), resulting in the return, on June 26,
2020, of a CAD$350,000 (approximately $255,570 on June 26, 2020) deposit to the Company.

 

LA
Fitness U.S. License Agreement & Guaranty

 

On
September 24, 2019, Novomerica Health Group Inc. (“Novomerica”), a wholly owned subsidiary of the Company, entered
into a Master Facility License Agreement with Fitness International, LLC and Fitness & Sports Clubs, LLC (together with Fitness
International, LLC, “LA Fitness U.S.”). The Master Facility License Agreement was amended on February 4, 2020, pursuant
to the terms of that certain First Amendment to Master Facility License Agreement between Novomerica and Fitness International,
LLC (“U.S. License Agreement”).

 

Pursuant
to the terms of the U.S. License Agreement, the parties agreed that from time to time as set forth in the U.S. License Agreement
or as the parties otherwise agree, Novomerica may wish to identify sublicensees to provide certain services in facilities operated
by LA Fitness U.S., and LA Fitness U.S. may desire to grant to such sublicenses the right to do the same. Upon execution of applicable
documentation as may be required by the U.S. License Agreement, the sublicensee (which may be Novomerica, if Novomerica desires
to provide Services (as hereinafter defined) itself) shall have the right, subject to the terms of the U.S. License Agreement,
to (i) occupy and use, on an exclusive basis, for the purposes of providing outpatient physical and/or occupational therapy as
provided in the U.S. License Agreement (the “Services”), with the applicable LA Fitness U.S. facility, and (ii) access
and use, on a non-exclusive basis, for the purpose of providing the Services, the applicable facility’s equipment and a
pool lane, and (iii) use, on a non-exclusive basis, the applicable facility’s common areas solely as necessary to access
the facility’s service area, equipment and a pool lane.

 

Pursuant
to the terms of the U.S. License Agreement, five separate initial licenses in Ohio were granted. Novomerica agreed to develop
and open for business (a) at least two of such facilities by June 30, 2020, (b) at least two additional facilities by September
30, 2020, and (c) the final remaining facility by December 31, 2020 (“U.S. Development Schedule”). Pursuant to the
terms of the U.S. License Agreement, in the event that Novomerica fails to meet the U.S. Development Schedule, the initial licenses
that Novomerica has developed and opened for business will remain unaffected; however, Novomerica will lose the right to develop
the remaining licenses.

 

 

With
respect to each license granted under the U.S. License Agreement, for the period beginning as of the commencement date of each
such license and continuing until the expiration or earlier termination of such license, Novomerica shall pay to LA Fitness U.S.
a monthly payment in an agreed upon amount.

 

Unless
sooner terminated as provided in the U.S. License Agreement, the term of the U.S. License Agreement shall expire simultaneously
with the expiration of earlier termination of the License Term (as such term is defined in the U.S. License Agreement) of the
last remaining license granted under the U.S. License Agreement.

 

Pursuant
to the terms of the U.S. License Agreement, the Company agreed to execute that certain Guaranty Agreement (the “U.S. Guaranty”)
dated September 24, 2019 by and between the Company and LA Fitness U.S. Pursuant to the terms of the U.S. Guaranty, the Company
irrevocably guaranteed the full, unconditional and prompt payment and performance of all of Novomerica’s obligations and
liabilities under the U.S. License Agreement.

 

In
March 2020, as a result of guidelines issued by local, state, and federal authorities due to the COVID-19 pandemic, LA Fitness
U.S. closed all facilities nationwide. Currently, under both government and internal corporate directives, LA Fitness U.S. is
cautiously opening certain facilities to limited access and services. As a result, all contractual terms and conditions of our
U.S. License Agreement are on hold, with all parties indicating the intention to amend the U.S. License Agreement and its timelines
once “normal” activity resumes in the LA Fitness U.S. facilities. Re-engagement of the contract terms may vary from
state to state; however, our model plan to partner and sub-license with existing local clinic ownership to launch and operate
each LA Fitness U.S. based micro-clinic remains intact.

 

Due to the ever-changing conditions surrounding
the re-opening of LA Fitness U.S. facilities, we are unable to verify our schedule to commence opening our micro-clinics, but we
are tentatively planning on a target of early 2021. Furthermore, in our discussions with LA Fitness U.S., all parties agree that
the pandemic has created renewed awareness of health wellness as a lifestyle rather than as a treatment. LA Fitness U.S. continues
to indicate the desire to continue our contractual agreements upon LA Fitness U.S. re-opening facilities post-pandemic. We believe
that the addition of our micro-clinics to LA Fitness U.S. facilities further enhances the benefits available to the facilities’
membership by providing direct access to certain multidimensional primary healthcare services.

 

LA
Fitness Canada License Agreement & Guaranty

 

On
September 24, 2019, NHL entered into a Master Facility License Agreement with LAF Canada Company (“LA Fitness Canada”).
The Master Facility License Agreement was amended on February 4, 2020, pursuant to the terms of that certain First Amendment to
Master Facility License Agreement between NHL and LA Fitness Canada (“Canada License Agreement”).

 

Pursuant
to the terms of the Canada License Agreement, the parties agreed that from time to time as set forth in the Canada License Agreement
or as the parties otherwise agree, NHL may wish to identify sublicensees to provide certain services in facilities operated by
LA Fitness Canada, and LA Fitness Canada may desire to grant to such sublicensees the right to do the same. Upon execution of
applicable documentation as may be required by the Canada License Agreement, the sublicensee (which may be NHL, if NHL desires
to provide Services (as hereinafter defined) itself) shall have the right, subject to the terms of the Canada License Agreement,
to (i) occupy and use, on an exclusive basis, for the purposes of providing the Services, with the applicable LA Fitness Canada
facility, and (ii) access and use, on a non-exclusive basis, for the purpose of providing the Services, the applicable facility’s
equipment and a pool lane, and (iii) use, on a non-exclusive basis, the applicable facility’s common areas solely as necessary
to access the facility’s service area, equipment and a pool lane.

 

Pursuant
to the terms of the Canada License Agreement, 17 separate initial licenses in Ontario, Canada and Alberta, Canada were granted.
NHL agreed to develop and open for business (a) at least four of such facilities by March 31, 2020, (b) at least six additional
facilities by June 30, 2020, (c) at least six additional facilities by September 30, 2020, and (4) the final remaining facility
by December 31, 2020 (the “Canada Development Schedule”). Pursuant to the terms of the Canada License Agreement, in
the event that NHL fails to meet the Canada Development Schedule, the initial licenses that NHL has developed and opened for business
will remain unaffected; however, NHL will lose the right to develop the remaining licenses.

 

 

As
defined in the Canada License Agreement, NHL has provided the initial four deposits due by March 31, 2020. In addition, NHL has
engaged clinicians to sublicense the roll-out and operation of micro-clinics as defined in the Canada License Agreement clinics
in LAF.

 

With
respect to each license granted under the Canada License Agreement, for the period beginning as of the commencement date of each
such license and continuing until the expiration or earlier termination of such license, NHL shall pay to LA Fitness Canada a
monthly payment in an agreed upon amount.

 

Unless
sooner terminated as provided in the Canada License Agreement, the term of the Canada License Agreement shall expire simultaneously
with the expiration of earlier termination of the License Term (as such term is defined in the Canada License Agreement) of the
last remaining license granted under the Canada License Agreement.

 

Pursuant
to the terms of the Canada License Agreement, the Company agreed to execute that certain Guaranty Agreement (the “Canada
Guaranty”) dated September 24, 2019 by and between the Company and LA Fitness Canada. Pursuant to the terms of the Canada
Guaranty, the Company irrevocably guaranteed the full, unconditional, and prompt payment and performance of all of NHL’s
obligations and liabilities under the Canada License Agreement.

 

In
March 2020, as a result of guidelines issued by local, provincial, and federal authorities due to the COVID-19 pandemic, LA Fitness
Canada closed all facilities nationwide. Currently, under both government and internal corporate directives, LA Fitness Canada
is cautiously opening certain facilities to limited access and services. As a result, all contractual terms and conditions of
our Canada License Agreement are on hold with all parties indicating the intention to amend the Canada License Agreement and its
timelines once “normal” activity resumes in the LA Fitness Canada facilities. Re-engagement of the contract terms
may vary from state to state; however, our model plan to partner and sub-license with existing local clinic ownership to launch
and operate each LA Fitness Canada based micro-clinic remains intact.

 

Due to the ever-changing conditions surrounding
the re-opening of LA Fitness Canada facilities, we are unable to verify our schedule to commence opening our micro-clinics, but
we are tentatively planning on a target of late summer 2021. Furthermore, in our discussions with LA Fitness Canada, all
parties agree that the pandemic has created renewed awareness of health wellness as a lifestyle rather than as a treatment. LA
Fitness Canada continues to indicate the desire to continue our contractual agreements upon the re-opening of LA Fitness Canada
facilities post-pandemic. We believe that the addition of our micro-clinics to LA Fitness Canada facilities further enhances the
benefits available to the facilities’ membership by providing direct access to certain multidimensional primary healthcare
services.

 

Regulation
A+ Offering

 

Beginning
on June 29, 2020, in a “Tier 2 Offering,” pursuant to an Offering Circular on Form 1-A, as amended, pursuant to Regulation
A, the Company offered, on a self-underwritten “best efforts” basis, up to 2,000,000 shares of its common stock,
with an aggregate amount of $30,000,000. The initial public Offering price per share of the Company’s common stock is $15.00
per share pursuant to the Offering. There is no minimum number of shares that needs to be sold in order for funds to be released
to the Company and for the Offering to close. The minimum investment amount per investor is $1,050 (70 shares of common
stock), subject to waiver by the Company. As of February 19, 2021, no shares have been sold and no funds have been raised
through this Regulation A+ Offering. 

 

Agreement
to Cash Payment on a Related Party Debenture

 

On
July 21, 2020, a related party debenture holder and the Company signed an Amendment No. 2 to a Debenture, originally dated September
30, 2013, to provide a cash payment equal to CAD$360,000 (approximately $267,768 as of July 21, 2020), which amount would be deducted
from the debenture principal balance, resulting in a remaining principal balance of CAD$390,000 (approximately $290,082 as of
July 21, 2020).

 

 

Agreement
to Convert Debt to Common Stock, Related Party Debtee

 

On
July 21, 2020, the Company and a related party debt holder agreed to convert the total remaining balance of a Loan Agreement,
originally dated January 19, 2016, with a total balance owed, including principal and interest, equal to CAD$304,321 (approximately
$226,363 as of July 21, 2020). The debt was converted into 15,091 restricted shares of the Company’s common stock
at a per share price of $15.00. As a result of the stock issuance, the related party loan debt has been paid in full.

 

Engagement
of Financial Advisor

 

On
July 31, 2020, the Company engaged Maxim Group LLC as the Company’s financial advisor to assist the Company in articulating
its growth strategy to the investment community and to assist the Company with its aspiration to up-list to a national exchange.

 

Officer
Employment Agreement

 

On
August 6, 2020, the Company and its President, Christopher David, entered into an Employment Agreement, effective August 5, 2020.
In consideration thereof, the Company agreed to pay Mr. David a monthly salary of $8,000. In addition, the Company agreed to grant
Mr. David an option to purchase 575,000 shares of the Company’s common stock at an exercise price of $3.00
per share. The option fully vested on the date of grant and expires on August 6, 2025.

 

Extension
of Acquisition LOI and Conversion of Refundable Deposit to Loan

 

On
August 31, 2020, the Company extended the termination date of an acquisition LOI to September 1, 2021 and to convert the LOI refundable
deposit of CAD$500,000 to a loan, payable to the Company, with an interest rate of 10% per annum and a due date of September 1,
2021.

 

New
Principal Financial Officer

 

On
December 15, 2020, Klara Radulyne notified us of her intent to resign as our Principal Financial Officer, effective December 15,
2020. On December 15, 2020, our Board of Directors appointed Thomas Bray as Principal Financial Officer. Mr. Bray also serves
as our principal accounting officer.

 

2794512
Ontario Inc. Asset Purchase Agreement

 

On
December 11, 2020, we entered into that certain Asset Purchase Agreement (the “2794512 APA”) by and between the Company
and 2794512 Ontario Inc. (the “Seller”), pursuant to which the Company agreed to purchase, and Seller agreed to sell,
generic primary and sub-primary drug formulations (known as bioequivalence) of name brand pharmaceutical reference products related
to usage as injectables, ophthalmic, and topical applications. Pursuant to the terms of the 2794512 APA, the purchase price was
$876,000, which was paid through the issuance by the Company by the Company of 240,000 restricted shares of common stock
based on the 30-day trading average of $3.65. The shares were issued on December 15, 2020.

 

Increase
of Board Size, Appointment of New Directors and Creation of Audit Committee

 

On
January 26, 2021, our Board of Directors, pursuant to power granted to the Board in our bylaws, increased the size of the Board
from four persons to seven persons. In addition, the Board named the following persons to serve as directors to fill the newly
created vacancies: Alex Flesias, Robert Oliva and Michael Pope. Each of Messrs. Pope, Oliva and Flesias qualifies as an independent
director under the Nasdaq listing rules. Also on January 26, 2021, the Board established an Audit Committee and named each of
Messrs. Flesias, Oliva and Pope to serve as members thereof. Mr. Pope serves as Chairman of the Audit Committee.

 

Reverse
Stock Split

 

On
February 1, 2021, we effected a 1-for-10 reverse stock split of our common stock. We implemented the reverse stock split in connection
with our application to uplist our common stock to The Nasdaq Capital Market. The reverse stock split is an action intended to
fulfill the stock price requirements for listing on Nasdaq. As a result of the reverse stock split, every 10 shares of issued
and outstanding common stock were exchanged for one share of common stock, with any fractional shares being rounded up to the
next higher whole share. The reverse stock split was approved by the Company’s Board of Directors and by stockholders holding
a majority of the Company’s voting power.

 

 

Approval
of the Novo Integrated Sciences, Inc. 2021 Equity Incentive Plan

 

On
February 9, 2021, our Board of Directors and stockholders holding a majority of our outstanding common stock approved the Novo
Integrated Sciences, Inc. 2021 Equity Incentive Plan (the “2021 Plan”). Under the 2021 Plan, a total of 4,500,000
shares of common stock are authorized for issuance pursuant to the grant of stock options, stock appreciation rights, restricted
stock, restricted stock units, performance units, performance shares or other cash- or stock-based awards to officers, directors,
employees and eligible consultants to the Company or its subsidiaries. Subject to adjustment as provided in the 2021 Plan, the
maximum aggregate number of shares that may be issued under the 2021 Plan will be cumulatively increased on January 1, 2022 and
on each subsequent January 1 through and including January 1, 2023, by a number of shares equal to the smaller of (i) 3% of the
number of shares of common stock issued and outstanding on the immediately preceding December 31, or (ii) an amount determined
by our Board of Directors. As of February 19, 2021, the 2021 Plan has 4,500,000 shares are available for award.

 

Business
Growth Initiatives

 

The
Company’s mission is to provide excellence in multidisciplinary primary health care assessment, diagnosis, treatment, pain
management and prevention through the integration of medical technology, advanced therapeutics and rehabilitative science. Key
elements of our business growth initiatives include:

 

 


Increase
Market Share in Canada through Organic Growth, Asset Acquisition and Contract Expansion for both our Clinic and Eldercare
Operations. Specific to our clinic-based operations, the Company has an ongoing initiative to expand our Canadian market
share through both organic growth and strategic acquisition of operating multidisciplinary primary health care clinics in
markets we are currently located as well as new geographic markets. Specific to our Eldercare based operations, we intend
to increase our Canada market share of providing contracted-occupational therapy and physiotherapy services to eldercare centric
homes through network affiliation growth, new contract awards and increased usage of telemedicine.

 

 

Expand
Operations into the United States through:
 
 
 
 
  
 
 

The
introduction of a customized version of our multidisciplinary primary health care service model with emphasis on pain prevention,
treatment and management as well as immune enhancement through the launch of micro-clinic facilities.
 
 
 
 
  
 
 

The
strategic acquisition of targeted U.S. operating clinics in key geographical areas.
 
 
 
 
  
 
 

Establishment
of strategic corporate alliances and partnerships with existing U.S. health care provider facilities, including certain of
our current Canadian clients with U.S.-based facilities, allowing us immediate access to their client base.
 
 
 
 
  
 
 

Integration
of specific specialized multidisciplinary primary health care services and products that are a direct compliment to the existing
primary care related products and services already provided by brand-recognized, established retail entities such as grocers,
pharmacies, health fitness clinics and clinics with a further emphasis of healthcare maintenance through product solutions.
 
 
 
 
  


Open
Micro-Clinic Facilities through our U.S. and Canada LA Fitness Master Facility License Agreements. Micro-clinic facilities
are reduced footprint clinics, primarily located within the premises of larger commercial enterprises, focused on providing
multidisciplinary primary health care and medical technology related services. Under the terms of our Agreement with LA Fitness
(U.S. and Canada), we are developing and opening micro-clinic facilities within the footprint of LA Fitness facilities throughout
both the U.S. and Canada. Each micro-clinic exists through either third-party sub-license agreements or corporate sponsored
arrangement. The Company’s LA Fitness based micro-clinic facilities will primarily provide outpatient physiotherapy
and occupational therapy services.

 

 

 


Further
Development and Usage of our Telemedicine Medical Technology Platform. Telemedicine is transforming traditional approaches
to health care by providing ease of access and reduced costs for patients for the delivery of certain healthcare related services.

 

Specific
to our eldercare-based operations, prior to COVID-19 our Telemedicine Medical Technology Platform was primarily focused on providing
physiotherapy related “virtual-care” services to both smaller and remote eldercare focused facilities to ensure access
to service providers, when needed; and continuity of care to eldercare patients without service providers in their area. With
the profound impact COVID-19 has had on the delivery on delivery of healthcare services sector wide, operating under COVID-19
related authorized governmental proclamations and directives, on April 1, 2020, we expanded our eldercare related Telemedicine
Medical Technology Platform to include non-critical resident reviews, exercise related activity and additional physiotherapy sessions,
ensuring continuity of service for our long-term care and retirement home clients.

 

Specific
to our Clinic based operations, the success of telemedicine has always depended on the adoption of virtual technology by clinicians,
medically licensed providers and the patient. A basic checklist approach to results allows both multidisciplinary clinicians and
medically licensed providers to remotely determine if direct medical attention is required rather than remote or virtual guidance
to care. The patient friendly telemedicine platform removes the traditional barrier represented by intimidating peripherals along
with necessary precision use and application of the peripherals to obtain accurate data necessary for appropriate diagnosis. A
patient can now feel certain of their role in the assessment process without sophisticated and exhaustive training.

 

Our
Telemedicine Medical Technology Platform intends to integrate certain medical devices, such as a blood pressure reading device,
a derma scope, an ophthalmoscope otoscope, and other add-ons each of which can provide both the clinician and the medically licensed
provider with real-time diagnostic data, greatly enhancing the ability to better provide the patient with an accurate diagnosis,
treatment and follow-on guidance. Our Telemedicine Medical Technology Platform is intended to allow any qualified location to
install and utilize our Telemedicine Medical Technology Platform at a relatively low-cost point of entry.

 

 

Develop and Launch our Remote Patient Monitoring Medical Technology Platform. Beyond the traditional confines of in-clinic visits, our Remote Patient Monitoring Medical Technology Platform (“RPM platform” or “RPM”) provides clinicians and practitioners the ability to maintain an on-going continuous connection with their patient community extending patient care directly into the patient’s home. Through our exclusive licensing agreement with Cloud DX, our RPM platform empowers a patient to have direct control of collecting and monitoring real-time vital sign information while maintaining a direct technology link from patient to clinician or medical practitioner. The transfer of vital information from home to clinic or patient to clinician allows for the delivery of high quality, non-redundant diagnostic based proactive healthcare. The implementation of in-clinic patient metrics equivalent to those derived via a remote application in the home environment is the first step in engaging patient retention to remote review. 
 
  
 
Effective with the re-opening of NHL’s corporate clinics post COVID-19 lockdown, we have launched Phase 1 of our Remote Patient Monitoring Medical Technology Platform. Using the Cloud DX technology, at the time of our clinic staff initiating patient check-in, NHL’s staff is collecting pertinent vital sign data for on-going analysis, comparison, and observation under the RPM license application. Our clinic staff are actively working to educate our patients regarding the benefits of participating in our RPM Platform. In Canada, third party insurance coverage for RPM related devices is now being reviewed for implementation nationwide. Currently, as documented and requested by the clinician, insurance coverage is being approved on a case-by-case basis. 
 
  
 
Additionally, the Company has implemented a marketing and sales program to sub-license the Cloud DX technology to our Canadian affiliate clinic network as well as other clinics and medically licensed providers throughout both Canada and the United States.

 

 

 

Develop and Launch our Novo Connect Medical Technology Platform. Our Novo Connect Medical Technology Platform (“Novo Connect”) is an app, currently in development, intended as a secure patient-centered portal designed to integrate numerous source systems for patient interface by facilitating communication between the patient and the patient’s provider. The Novo Connect app will be developed for Web, iOS and Android application to optimize communication between source systems. Novo Connect is being designed to allow patients to have direct control of their overall healthcare and wellness by providing a suite of secure, reliable engagement features, such as, but not limited to:

 

 
 

Appointment scheduling 
 

Bi-directional interface with Electronic Health Records (EHR) 
 

Access to Forms and Documents 
 

Distribute patient data from C-CDAs to the patient portal regardless of source EHR 
 

Bill Pay 
 

E-commerce 
 

Remote Patient Monitoring Medical Technology Platform Interface 
 

Telemedicine 
 

Patient-focused wellness information

 

 

Build an Intellectual Property and Patent Portfolio. We intend to acquire or obtain licensing rights for Intellectual Property (IP) and patents related to health sciences and nano-formulation. When considering nano-formulation patent and IP assets, one specific area we intend to pursue relates to medical cannabis related medicines, beverages and foods infused with dry powder, liquid or oil with further formulation into creams and gels, allowing for oral, intravenous and/or transdermal delivery.   
 
  

Acquire Ownership Interest in Licensed Pharmaceutical Manufacturing and Packaging Facilities. As we build our Intellectual Property portfolio, having ownership of a licensed, high-grade pharmaceutical product manufacturing and packaging solution is integral in creating the medium for use and application of our proprietary health sciences as well as mitigating market exclusion and enhancing patient service and product offerings.   
 
  

Expand our Posture, Stride, and Kinetic Body Movement Scanning Technologies and Protocols. When combined with decades of data harvesting and analysis, we believe these specialized technologies and protocols provide our clinics with the ability to deliver better healthcare, through early diagnosis and preventative health care strategies, to both our patients and patients under the care of other providers.   
 
  

Launch our Exclusive Medicinal Cannabidiol (“CBD”) Product Platform based in Canada. As we continue to build our health science platform of services and products through the integration of technology and rehabilitative science, one component of our lateral business growth strategy includes developing business units centered on the direct control of the cultivation, processing, and manufacturing of CBD products in Canada, and the sale and distribution of medicinal CBD products in Canada and authorized U.S. states. We expect our prospective medicinal CBD products will be specifically focused on CBD for use (i) as a treatment aid; (ii) to provide relief for a large array of neurological and musculoskeletal system disorders; and (iii) as an alternative option for health care providers in place of prescribing opioids to patients.   
 
  
 
Offering
our patients access to non-hallucinogenic and non-addictive natural remedies, under required clinical oversight policies and procedures
as they relate to medicinal CBD, combined with our existing clinic-based treatment protocols, allows us to enter this market segment
with a unique integration model not readily available in the marketplace.

 

About
Our Affiliate Clinics

 

In
order to strengthen our position within the Canadian Preferred Provider Network (“PPN”), we’ve built a contracted
affiliate relationship with 103 clinics across Canada with 83 affiliate clinics in Ontario province and 20 affiliate
clinics located throughout Alberta, Nova Scotia and Newfoundland.

 

 

The
PPN is a network of three major insurance companies and their subsidiaries, totaling 11 insurance companies. PPN member insurance
companies, in need of specific multidisciplinary primary health care solutions for their patients, send referrals to specific
clinics registered through the PPN. We, as one of five major providers to the PPN, receive referrals through the PPN. This subset
of business is a continuous source of referrals, from the insurance company payer to the approved group of clinics meeting the
insurance companies’ pre-determined set of criteria for what they believe to be an appropriate clinical setting. Affiliate
clinics pay us a mix of a flat fee and a percentage-based fee upon receipt of a payment for a service referred through the PPN.

 

The
services provided by our affiliate clinics are consistent with the multidisciplinary primary health care services provided by
our own corporate clinics. While each affiliate clinic may provide additional unique health care solutions, all affiliate clinics
must meet specific criteria established under the PPN, creating a single standard of excellence across all clinics within our
network.

 

Cloud
DX

 

On
February 26, 2019, the Company completed a Software License Agreement with Cloud DX, Inc., a medical device company, operating
in the United States and Canada that develops both hardware and related software for Remote Patient Monitoring Medical Technology
Platform and Chronic Care, that provides NHL with perpetual licensing rights to the Bundled Pulsewave PAD-1A USB Blood Pressure
Device, related software and up-to-date product releases. Additionally, the License Agreement provides NHL with conditional exclusive
rights, over the initial 5-year period, to sub-license and re-sell Bundled Pulsewave Devices and related software.

 

The
Cloud DX platform allows NHL to further expand on its patient care philosophy of maintaining an on-going continuous connection
with its patient community, beyond the traditional confines of a clinic, extending oversight of patient care and monitoring directly
into the patient’s home through Remote Patient Monitoring Medical Technology Platform. The Cloud DX technology empowers
a patient with real-time vital sign information while maintaining a direct technology link from patient to clinician or medical
practitioner. The transfer of vital information from home to clinic or patient to clinician further allows our clinicians and
practitioners to deliver non-redundant diagnostic based proactive multidisciplinary primary health care.

 

Effective
with the re-opening of NHL’s corporate clinics, post COVID-19 lockdown, we have launched Phase 1 of our Remote Patient Monitoring
Medical Technology Platform. Using the Cloud DX technology, as part of our clientele’s check-in and daily screening process
we are collecting pertinent vital sign data for on-going analysis, comparison, and observation under the RPM application.

 

Additionally,
the Company has implemented a marketing and sales program to sub-license the Cloud DX technology to our Canadian affiliate clinic
network as well as other clinics and medically licensed providers throughout both Canada and the United States.

 

Contracts

 

Certain
contracts held with client homes and client companies follow standard formats and include generally accepted terms of reference.
Specific clauses within the NHL contracts for services contain language intended to (1) clarify which entity is the health information
custodian of the medical files (usually held by the client home or company), (2) define release of liability, (3) ensure privacy
and confidentiality of proprietary information or private health information, (4) define provisions of worker’s compensation
clearance or benefits for employees and/or contractors, (5) detail provisions of value-added items, services or programs, (6)
set out terms and conditions of the contract (often for a set number of years with an option to a renew), (7) provide for termination
conditions, and (8) detail invoicing and billing procedures.

 

Employees

 

As
of January 31, 2021, we employ 78 full-time employees. Approximately 85% of our clinicians and practitioners are
contracted as independent contractors. We believe that a diverse workforce is important to our success. We will continue to focus
on the hiring, retention and advancement of women and underrepresented populations, and to cultivate an inclusive and diverse
corporate culture. In the future, we intend to continue to evaluate our use of human capital measures or objectives in managing
our business such as the factors we employ or seek to employ in the development, attraction and retention of personnel and maintenance
of diversity in our workforce.

 

 

The
success of our business is fundamentally connected to the well-being of our people. Accordingly, we are committed to the health,
safety and wellness of our employees. We provide our employees and their families with access to a variety of innovative, flexible
and convenient health and wellness programs, including benefits that provide protection and security so they can have peace of
mind concerning events that may require time away from work or that impact their financial well-being; that support their physical
and mental health by providing tools and resources to help them improve or maintain their health status and encourage engagement
in healthy behaviors; and that offer choice where possible so they can customize their benefits to meet their needs and the needs
of their families.

 

We
also provide robust compensation and benefits programs to help meet the needs of our employees. We believe that we maintain a
satisfactory working relationship with our employees and have not experienced any labor disputes.

 

Competition

 

Other
Multidisciplinary Primary Health Care Providers

 

In
Canada, the specialized multidisciplinary primary health care service sector in which we operate is highly competitive. Specific
to both our Clinic and Eldercare operations, with a finite number of patients and corporate clients, companies providing multidisciplinary
primary health care services operate within an overlapping patient and client landscape.

 

Our
business growth initiatives include expanding our patient base through both opening new clinics and the acquisition of existing
multidisciplinary primary health care providers and clinics in markets that we currently populate, as well as in new geographic
markets, including the United States. There is additional competition from non-traditional health care providers, such as holistic
and Eastern medicine-based clinics. We believe we can successfully compete based on providing high-quality specialized multidisciplinary
primary health care services, competitive pricing, building and maintaining a solid reputation and our clinicians’ devotion
to maintaining the highest quality patient satisfaction.

 

Health
Insurance Plans

 

Additionally,
our ability to effectively compete for patients is impacted by commercial and managed care payor programs that influence patient
choice by offering health insurance plans that restrict patient choice of provider.

 

Canadian
Health Care System

 

Our
competition will also be the Canadian health care system which is a government sponsored system that began in 1957, when Parliament
approved the Hospital Insurance and Diagnostics Services Act. The Act provided free acute hospital care, laboratory and radiological
diagnostic services to Canadians. By 1961, agreements were in place with all the provinces and 99% of Canadians had free access
to the health care services covered by the legislation. The Act was followed by the Medical Care Act of 1966 that provided free
access to physician services. By 1972, each province had established its own system of free access to physician services. The
federal government shared in the funding. In 1984, the Government of Canada passed the Canada Health Act (CHA). The Canada Health
Act created a publicly administered health care system that is comprehensive, universal and accessible. All medically necessary
procedures are provided free of charge. The system provides diagnostic, treatment and preventive services regardless of income
level or station in life. Access to care is not based on health status or ability to pay. Coverage is portable between provinces
and territories. We can give no assurance that we will be able to effectively compete in this market.

 

 

Government
Regulation and Health Care Regulation

 

Canada

 

In
Canada, some health care services are public, some are private and there are a number of different entities involved in regulating
and providing their delivery. While there is a perception that all health care in Canada is publicly funded, the publicly funded
system is generally restricted to “medically necessary” hospital and physician services, and provincial or territorial
drug plans that provide access to prescription drugs to residents over the age of 65 or those residents who rely on social assistance
programs. Publicly funded services are delivered through a combination of public and private providers and funding comes from
the Canadian federal government, which sets national standards, and the provincial and territorial governments, which regulates
the delivery of services and determines those services that are deemed “medically necessary” (i.e., publicly funded)
within the context of their own unique fiscal and political environment. In addition, there are a wide array of health products
and services that are not subject to coverage under the public health insurance plans that are provided on a private payer basis.
See “Risks Related to our Multidisciplinary Primary Health Care Business”.

 

Federal/Provincial
Government Division of Power

 

As
is the case for many important industries and economic sectors, neither the federal, nor the provincial/territorial level of government
has exclusive jurisdiction over health. Instead, the Constitution Act, 1867, divides the legislative powers relevant to the regulation
of the delivery of health products and services between the federal and provincial levels of government.

 

The
federal government is responsible for regulating important aspects of various health industries or sectors including the regulation
of selling, importing, distributing and marketing of drugs and medical devices and maintains significant influence over health
policy and national objectives through the use of its spending power.

 

The
provincial/territorial level of government has comprehensive authority over the delivery of health care services. Other examples
of provincial responsibility include the regulation of hospitals and other health facilities, administration of health insurance
plans, distribution of prescription drugs and regulation of health professionals.

 

However,
many health industry sectors are subject to at least some degree of regulation or oversight by both levels of government.

 

Canada’s
National Health Insurance Program

 

Canada’s
“national” health insurance program, a publicly funded single-payer system often referred to as “Medicare,”
is designed to ensure that all Canadian residents have universal access to medically necessary hospital and physician services
through the provincial and territorial health care insurance plans.

 

The
Canada Health Act

 

The
Canada Health Act is the federal legislation that provides the foundation for the Canadian health care system. The Act is administered
by Health Canada, the federal department with primary responsibility for maintaining and improving the health of Canadians. However,
neither the Canada Health Act nor Health Canada have direct authority to regulate the health insurance plans that give effect
to the publicly funded health insurance system that is in place across the country. Instead, the Act establishes certain values
and principles and sets out criteria and conditions that each publicly funded health insurance plan is required to meet in order
to qualify for federal funding through the Canada Health Transfer. As federal funding is critical to the ability to fund “medically
necessary” hospital and physician services, each provincial and territorial health insurance plan must satisfy the requirements
of public administration; universality; portability; comprehensiveness; and accessibility.

 

Notably,
these requirements relate only to funding and administration and establish broad principles rather than a prescriptive code. In
addition, the Canada Health Act is silent with respect to the delivery of health services and does not prohibit or discourage
the delivery of insured health services by the private sector. As a result, there is significant variation in the funding and
administration of health insurance plans from one jurisdiction to another. However, most provinces permit the delivery of a broad
range of publicly funded health services through a combination of both public and private providers. Indeed, many publicly funded
services in Canada are privately delivered.

 

The
requirement that publicly funded health insurance plans be comprehensive requires that “medically necessary” hospital
and physician services be covered. If a service is determined to be “medically necessary” then the full cost of the
service must be covered by the public plan. However, the term is not defined and the services that must be covered are intentionally
and broadly defined in order to accommodate the ability of each province and territory to make its own coverage decisions within
the context of its unique fiscal and political environment. Typically, such decisions are made in consultation with the relevant
medical associations in the jurisdiction. However, determining whether a particular service is “medical necessary”
is a determination that has both a fiscal and political dimension. Ultimately, these coverage decisions are decisions about the
allocation of scarce public resources.

 

 

The
products and services available to Canadians through the publicly funded health insurance system are supplemented by a wide array
of health products and services that are not, as a general matter, subject to coverage under the public health insurance plans.
For example, prescription drug coverage, dental services and vision care are generally provided on a private payer basis. However,
many jurisdictions provide coverage for these types of services to seniors and those who face financial or other barriers to privately
funded health care. There are also a growing number of providers that offer non-medically necessary ancillary health services.
Examples include elective surgical or cosmetic procedures.

 

Regulation
of Health Professionals and Health Facilities

 

Health
professionals and health care facilities are subject to federal laws of general application, but the regulation of such matters
is largely a matter of provincial jurisdiction.

 

Health
Professionals

 

Through
legislation, the provinces have delegated the regulation of health professionals to self-governing professional bodies (with varying
degrees of discretion). Such legislation generally seeks to protect the public through a combination of “input regulations”
that focus on who is entitled to provide a particular health service and “output regulations” that focus on the quality
and delivery of the service being provided. Such regulations also generally include conflict of interest (or anti-kickback) provisions,
as such matters are generally dealt with as part of the regulation of health professions rather than the regulation of health
facilities.

 

Health
industry participants that offer a particular service need to understand how the service is regulated. If the service involves
the performance of a regulated or controlled act (i.e., acts that can only be performed by a particular category or categories
of regulated health professionals or their delegates) then the involvement of one or more duly qualified health professionals
will likely be required. Also, it may be necessary to implement certain protocols and procedures in order to comply with the requirements
of the regulatory colleges that govern the practices of any such professionals. Complying with such requirements can have significant
commercial implications.

 

Health
facilities

 

Operating
a regulated health facility can be challenging and often involves a degree of regulatory risk.

 

Residential
health care facilities other than hospitals, such as nursing homes, long-term care facilities, pharmacies, laboratories and specimen
collection clinics are, in most jurisdictions, privately owned and operated pursuant to provincial licenses and oversight. However,
the degree to which such health facilities and other providers are regulated generally depends on the nature of the products and
services being provided.

 

The
operation of health facilities by private sector entities still typically involves some element of reimbursement through public
funds. Where public funds are being used to acquire goods and services, additional accountability measures such as procurement
requirements often apply.

 

Regulation
of Drugs

 

The
process of obtaining marketing authorizations and approvals of prescription drugs is administered by Health Canada’s Therapeutic
Products Directorate (“TPD”).

 

 

The
TPD applies the Food and Drugs Act and the regulations applicable to prescription drugs to ensure that drug products sold in Canada
are safe and effective. No drug product can be offered for sale in Canada unless and until, after review, it is issued a marketing
authorization by Health Canada.

 

In
addition to its review of drug products, Health Canada is responsible for the ongoing monitoring of drug products being sold in
Canada, as well as the regulation of good manufacturing practices and establishment licenses, which are required in connection
with the import, manufacture, distribution and/or sale of drug products.

 

The
Patented Medicines Prices Review Board

 

The
Patented Medicines Prices Review Board (“PMPRB”) is an independent quasi-judicial body created in 1987 under amendments
to the Patent Act. The PMPRB is responsible for regulating the prices that patentees charge for prescription and non-prescription
patented drugs sold in Canada. Based on a review of the information required to be filed by a patentee, the PMPRB considers whether
the price of a medicine appears excessive based on certain factors including: (i) the prices that the patented medicine is sold
in the Canadian market; (ii) the prices at which other medicines in the same therapeutic class are sold in the Canadian market;
and (iii) the prices at which the medicine and other medicines in the same therapeutic class have been sold in other countries
other than Canada. If the PMPRB considers the price of a medicine appears excessive, revised pricing is the usual outcome.

 

Public
Market Access

 

Each
province has a provincial drug plan that allows certain individuals to access drugs at a reduced cost. Products that will be paid
for by the provincial government (in some provinces, for all residents, while in others for certain prescribed individuals such
as seniors and individuals receiving social assistance), are typically listed on provincial formularies. For innovator products,
the manufacturer negotiates the pricing for inclusion on the provincial formulary with the provincial government. For generic
products, the price to be paid for the generic product is determined by a sliding scale of fixed prices related to when such products
enter the market and the price of the innovator product (i.e., a percent of the price of the innovator pharmaceutical product
depending on whether they are first, second or third entry products). If a drug is a generic product and listed as interchangeable
on the provincial formulary, a pharmacist is permitted to dispense the interchangeable product for the innovator product. Under
most provincial benefit plans, interchanging a generic product for the innovator product by pharmacists is mandatory and generally
most provinces will only reimburse the pharmacist for the lowest cost interchangeable product. Government drug plans account for
approximately 50% of all sales of prescription drugs in Canada.

 

The
scope and enforcement of each of these laws is uncertain and subject to constant change. Federal and provincial enforcement entities
have significantly increased their scrutiny of health care companies and providers which has led to investigations, prosecutions,
convictions and large settlements. Although we conduct our business in compliance with all applicable federal and provincial fraud
and abuse laws, many of these laws are broadly worded and may be interpreted or applied in ways that cannot be predicted with
any certainty. Therefore, we cannot assure you that our arrangements or business practices will not be subject to government scrutiny
or that they will be found to be in compliance with applicable fraud and abuse laws. Further, responding to investigations can
be time consuming and result in significant legal fees and can potentially divert management’s attention from the Company.

 

Client
Information Privacy

 

In
Canada, under the Personal Information Protection and Electronic Documents Act and under various provincial laws, comprehensive
privacy laws have been introduced to protect the privacy of individuals from the undisclosed or non-consensual sharing of sensitive
information for commercial purposes. As the gathering and use of information is such an integral component of our business, we
must always be alert for and respond to changes in the information regulatory environment.

 

Protection
of Environment and Human Health and Safety

 

We
are subject to various federal, state and local and regulations relating to the protection of the environment and human health
and safety, including those governing the management and disposal of hazardous substances and wastes, the cleanup of contaminated
sites and the maintenance of a safe workplace. Some of our operations include the use, generation and disposal of hazardous materials.
We also plan to acquire ownership in new facilities and properties, some of which may have had a history of commercial or other
operations. We may, in the future, incur liability under environmental statutes and regulations with respect to contamination
of sites we own or operate, including contamination caused by prior owners or operators of such sites, abutters or other persons,
and the off-site disposal of hazardous substances. Violations of these laws and regulations may result in substantial civil penalties
or fines.

 

 

United
States

 

The
United States health care industry is subject to extensive regulation by federal, state and local governments. Government regulation
affects our businesses in several ways, including requiring licensure or certification of facilities, regulating billing and payment
for certain of our services, regulating how we maintain health-related information and patient privacy, and regulating how we
pay and contract with our physicians. Our ability to conduct our business and to operate profitability depends in part upon obtaining
and maintaining all necessary licenses and other approvals; and complying with applicable healthcare laws and regulations. See
“Risk Factors — Risks Related to Healthcare Regulation.”

 

State
Law Regulation of Construction, Acquisition or Expansion of Healthcare Facilities

 

Thirty-six
states have certificate of need programs that require some level of prior approval for the construction of a new facility, acquisition
or expansion of an existing facility, or the addition of new services at various healthcare facilities. Following the acquisition
of one or more clinics or staffing primary healthcare practitioners in the United States, states where we may seek to operate
may require a certificate of need to acquire or operate our clinics.

 

State
Licensure

 

Only
a few states may require the licensure of multidimensional primary health care clinics and clinics such as ours. This absence
of a uniform licensing process leads to inconsistencies in the nature and scope of services offered at our care clinics. To effectively
control both the nature of services rendered and the environment in which services are offered, state legislators or regulators
may attempt to regulate the urgent care industry in a manner similar to hospitals and freestanding emergency rooms. Following
the acquisition of one or more clinics or staffing primary healthcare practitioners in the United States, such regulations could
have a material impact on our growth strategy and expansion plans.

 

Laws
and Rules Regarding Billing

 

Following
the intended acquisition, or opening, of one or more multidisciplinary primary healthcare clinics or the staffing of multidisciplinary
primary healthcare clinics, affiliate clinics or eldercare centric homes with clinicians and practitioners in the United States,
numerous state and federal laws may apply to our claims for payment, including but not limited to (i) “coordination of benefits”
rules that dictate which payor must be billed first when a patient has coverage from multiple payors, (ii) requirements that overpayments
be refunded within a specified period of time, (iii) “reassignment” rules governing the ability to bill and collect
professional fees on behalf of other providers, (iv) requirements that electronic claims for payment be submitted using certain
standardized transaction codes and formats, and (v) laws requiring all health and financial information of patients in a manner
that complies with applicable security and privacy standards.

 

Additionally,
on January 16, 2009, the United States Department of Health and Human Services (“HHS”), released the final rule (implemented
on October 1, 2015) mandating that providers covered by the Administrative Simplification Provisions of the Health Insurance Portability
and Accountability Act of 1996 (“HIPAA”), including our clinics, comply with ICD-10. Following the acquisition of
one or more clinics or staffing primary healthcare practitioners in the United States, we will incur additional compliance related
costs.

 

Medicare
and Medicaid

 

Following
the intended acquisition, or opening, of one or more multidisciplinary primary healthcare clinics or the staffing of multidisciplinary
primary healthcare clinics, affiliate clinics or eldercare centric homes with clinicians and practitioners in the United States,
our clinics and multidisciplinary primary healthcare clinicians and practitioners, including any staffing we might pursue in affiliate
clinics or eldercare centric homes in the United States, might participate in the federal Medicare and/or Medicaid programs.

 

 

Since
1992, Medicare has paid for the “medically necessary” services of physicians, non-physician practitioners, clinicians
and certain other suppliers under a physician fee schedule, a system that pays for covered physicians’ services furnished
to a person with Medicare Part B coverage. Under the physician fee schedule, relative values are assigned to each of more than
7,000 services to reflect the amount of work, the direct and indirect (overhead) practice expenses, and the malpractice expenses
typically involved in furnishing that service. Each of these three relative value components is multiplied by a geographic adjustment
factor to adjust the payment for variations in the costs of furnishing services in different localities. Relative value units,
or RVUs, are summed for each service and then are multiplied by a fixed-dollar conversion factor to establish the payment amount
for each service. The higher the number of RVUs assigned to a service, the higher the payment. Under the Medicare fee-for-service
payment system, an individual can choose any licensed physician enrolled in Medicare and use the services of any healthcare provider
or facility certified by Medicare.

 

On
November 2, 2017, the Clinics for Medicare & Medicaid Services (“CMS”) issued a final rule updating the Quality
Payment Program (“QPP”) under the Medicare and CHIP Reauthorization Act of 2015 (“MACRA”). MACRA was signed
into law on April 16, 2015, ending the Sustained Growth Rate (“SGR”) formula for determining Medicare spending on
physician services. MACRA created two provider payment tracks—the Medicare Incentive Payment System (“MIPS”)
and the Advanced Alternative Payment Models (“A-APM”) track. Under MIPS, clinicians receive an annual composite score,
which drives either an upward or downward rate adjustment two years after the performance period. Under the A-APM track, participants
in Medicare Alternative Payment Models that exceed specified levels of clinician risk become MIPS-exempt and receive special bonuses
equivalent to 5% of their annual Part B revenue. MACRA requirements on clinicians are already in effect for calendar year 2017,
with payment adjustments under the new system due to start in 2019. However, in rulemaking last year, CMS significantly scaled
back MIPS requirements for Performance Year 2017 to address concerns about physician buy-in and participation. Under the Final
Rule, CMS would continue this “go slow” trajectory for MIPS, notably by increasing MIPS exemptions and once again
scaling back potential downside payment adjustments through design of the MIPS scoring system. Reductions in Medicare payments
could have a material adverse effect on our business.

 

CMS’s
RAC Program

 

The
Medicare Prescription Drug Improvement and Modernization Act of 2003 (“MMA”) introduced on a trial basis the use of
Recovery Audit Contractors (“RACs”) for the purpose of identifying and recouping Medicare overpayments and underpayments.
Any overpayment received from Medicare is considered a debt owed to the federal government. In October 2008, CMS made the RAC
program permanent. RACs review Medicare claims to determine whether such claims were appropriately reimbursed by Medicare. RACs
engage in an automated review and in a complex review of claims. Automated reviews are conducted when a review of the medical
record is not required and there is certainty that the service is not covered or is coded incorrectly. Complex reviews involve
the review of all underlying medical records supporting the claim and are generally conducted where there is a high likelihood,
but not certainty, that an overpayment has occurred. RACs are paid a contingency fee based on overpayments they identified and
collected.

 

A
Medicare administrative contractor, or MAC, may suspend Medicare payments to a provider if it determines that an overpayment has
occurred. When a Medicare claim for payment is filed, the MAC will notify the patient and the provider of its initial determination
regarding reimbursement. The MAC may deny the claim for one of several reasons, including the lack of necessary information or
lack of medical necessity for the services rendered. Providers may appeal any denials for claim payment.

 

Anti-Kickback
Statute

 

Following
the intended acquisition, or opening, of one or more multidisciplinary primary healthcare clinics or the staffing of multidisciplinary
primary healthcare clinics, affiliate clinics or eldercare centric homes with clinicians and practitioners in the United States,
if we are participants in the Medicare program, we will be subject to the Anti-kickback Statute. The Anti-Kickback Statute prohibits
the knowing and willful offer, payment, solicitation or receipt of remuneration, directly or indirectly, in return for the referral
of patients or arranging for the referral of patients, or in return for the recommendation, arrangement, purchase, lease or order
of items or services that are covered, in whole or in part, by a federal healthcare program such as Medicare or Medicaid. The
term “remuneration” has been broadly interpreted to include anything of value such as gifts, discounts, rebates, waiver
of payments or providing anything at less than its fair market value. The Patient Protection and Affordable Care Act (the “ACA”)
amended the intent requirement of the Anti-Kickback Statute such that a person or entity can be found guilty of violating the
statute without actual knowledge of the statute or specific intent to violation the statute. Further, the ACA now provides that
claims submitted in violation of the Anti-Kickback Statute constitute false or fraudulent claims for purposes of the civil False
Claims Act (“FCA”) including the failure to timely return an overpayment. Many states have adopted similar prohibitions
against kickbacks and other practices that are intended to influence the purchase, lease or ordering of healthcare items and services
reimbursed by a governmental health program or state Medicaid program. Some of these state prohibitions apply to remuneration
for referrals of healthcare items or services reimbursed by any third-party payor, including commercial payors.

 

 

Following
the intended acquisition, or opening, of one or more multidisciplinary primary healthcare clinics or the staffing of multidisciplinary
primary healthcare clinics, affiliate clinics or eldercare centric homes with clinicians and practitioners in the United States,
if we accept funds from governmental health programs, we will be subject to the Anti-Kickback Statute. Violations of the Anti-Kickback
Statute can result in exclusion from Medicare, Medicaid or other governmental programs as well as civil and criminal penalties,
such as $25,000 per violation and up to three times the remuneration involved. If in violation, we may be required to enter into
settlement agreements with the government to avoid such sanctions. Typically, such settlement agreements require substantial payments
to the government in exchange for the government to release its claims, and may also require entry into a corporate integrity
agreement, or CIA. Any such sanctions or obligations contained in a CIA could have a material adverse effect on our business,
financial condition and results of operations.

 

False
Claims Act

 

The
federal civil FCA prohibits providers from, among other things, (1) knowingly presenting or causing to be presented, claims for
payments from the Medicare, Medicaid or other federal healthcare programs that are false or fraudulent; (2) knowingly making,
using or causing to be made or used, a false record or statement to get a false or fraudulent claim paid or approved by the federal
government; or (3) knowingly making, using or causing to be made or used, a false record or statement to avoid, decrease or conceal
an obligation to pay money to the federal government. The “qui tam” or “whistleblower” provisions of the
FCA allow private individuals to bring actions under the FCA on behalf of the government. These private parties are entitled to
share in any amounts recovered by the government, and, as a result, the number of “whistleblower” lawsuits that have
been filed against providers has increased significantly in recent years. Defendants found to be liable under the FCA may be required
to pay three times the actual damages sustained by the government, plus mandatory civil penalties ranging between $5,500 and $11,000
for each separate false claim.

 

There
are many potential bases for liability under the FCA. The government has used the FCA to prosecute Medicare and other government
healthcare program fraud such as coding errors, billing for services not provided, and providing care that is not medically necessary
or that is substandard in quality. The ACA also provides that claims submitted in connection with patient referrals that results
from violations of the Anti-Kickback Statute constitute false claims for the purpose of the FCA with some courts determining that
a violation of the Stark law can result in FCA liability as well. In addition, a number of states have adopted their own false
claims and whistleblower provisions whereby a private party may file a civil lawsuit in state court. Following the acquisition
of one or more clinics or staffing primary healthcare practitioners in the United States, we will be required to provide information
to our employees and certain contractors about state and federal false claims laws and whistleblower provisions and protections.

 

Civil
Monetary Penalties Statute

 

The
federal Civil Monetary Penalties statute prohibits, among other things, the offering or giving of remuneration to a Medicare or
Medicaid beneficiary that the person or entity knows or should know is likely to influence the beneficiary’s selection of
a particular provider or supplier of items or services reimbursable by a federal or state healthcare program.

 

 

Electronic
Health Records

 

As
required by the American Recovery and Reinvestment Act of 2009, the Secretary of HHS has developed and implemented an incentive
payment program for eligible healthcare professionals that adopt and meaningfully use electronic health record, or EHR, technology.
HHS uses the Provider Enrollment, Chain and Ownership System, or PECOS, to verify Medicare enrollment prior to making EHR incentive
program payments. If our employed professionals are unable to meet the requirements for participation in the incentive payment
program, including having an enrollment record in PECOS, we will not be eligible to receive incentive payments that could offset
some of the costs of implementing EHR systems. Further, healthcare professionals that fail to demonstrate meaningful use of certified
EHR technology are subject to reduced payments from Medicare. System conversions to comply with EHR could be time consuming and
disruptive for physicians and employees. Failure to implement EHR systems effectively and in a timely manner could have a material
adverse effect on our financial position and results of operations.

 

Following
the intended acquisition, or opening, of one or more multidisciplinary primary healthcare clinics or the staffing of multidisciplinary
primary healthcare clinics, affiliate clinics or eldercare centric homes with clinicians and practitioners in the United States,
we will convert certain of our clinical and patient accounting information system applications to newer versions of existing applications
or altogether new applications. In connection with our implementation and conversions, we will likely incur capitalized costs
and additional training and implementation expenses.

 

Privacy
and Security Requirements of Our Business Lines

 

Following
the intended acquisition, or opening, of one or more multidisciplinary primary healthcare clinics or the staffing of multidisciplinary
primary healthcare clinics, affiliate clinics or eldercare centric homes with clinicians and practitioners in the United States,
numerous federal and state laws and regulations, including HIPAA and the Health Information Technology for Economic and Clinical
Health Act, as amended (“HITECH”) will govern the collection, dissemination, security, use and confidentiality of
patient-identifiable health information. As required by HIPAA, HHS has adopted standards to protect the privacy and security of
this health-related information. The HIPAA privacy regulations contain detailed requirements concerning the use and disclosure
of individually identifiable health information and the grant of certain rights to patients with respect to such information by
“covered entities.” We believe that all or substantially all of our entities qualify as covered entities under HIPAA.
We will take actions to comply with the HIPAA privacy regulations including the creation and implementation of policies and procedures,
staff training, execution of HIPAA-compliant contractual arrangements with certain service providers and various other measures.
Although we believe we will be in substantial compliance, ongoing implementation and oversight of these measures involves significant
time, effort and expense.

 

In
addition to the privacy requirements, HIPAA covered entities must implement certain administrative, physical, and technical security
standards to protect the integrity, confidentiality and availability of certain electronic health-related information received,
maintained, or transmitted by covered entities or their business associates. Although we have taken actions in an effort to be
in compliance with these security regulations, a security incident that bypasses our information security systems causing an information
security breach, loss of PHI, or other data subject to privacy laws or a material disruption of our operational systems could
have a material adverse effect on our business, along with fines. Furthermore, ongoing implementation and oversight of these security
measures involves significant time, effort and expense.

 

Further,
HITECH, as implemented in part by an omnibus final rule published in the Federal Register on January 25, 2013, further requires
that patients be notified of any unauthorized acquisition, access, use, or disclosure of their unsecured protected health information,
or PHI, that compromises the privacy or security of such information. HHS has established the presumption that all unauthorized
uses or disclosures of unsecured PHI constitute breaches unless the covered entity or business associate establishes there is
a low probability that the information has been compromised. HITECH and implementing regulations specify that such notifications
must be made without unreasonable delay and in no case later than 60 calendar days after discovery of the breach. Breaches affecting
500 patients or more must be reported immediately to HHS, which will post the name of the breaching entity on its public website.
Furthermore, breaches affecting 500 patients or more in the same state or jurisdiction must also be reported to the local media.
If a breach involves fewer than 500 people, the covered entity must record it in a log and notify HHS of such breaches at least
annually. These breach notification requirements apply not only to unauthorized disclosures of unsecured PHI to outside third
parties but also to unauthorized internal access to or use of such PHI.

 

 

The
scope of the privacy and security requirements under HIPAA was substantially expanded by HITECH, which also increased penalties
for violations. Penalties for violations of these laws vary. For instance, penalties for failure to comply with a requirement
of HIPAA and HITECH vary significantly, and include significant civil monetary penalties and, in certain circumstances, criminal
penalties with fines up to $250,000 per violation and/or imprisonment. In addition, numerous breach incidents could lead to possible
penalties in excess of $1.68 million. A person who knowingly obtains or discloses individually identifiable health information
in violation of HIPAA may face a criminal penalty of up to $50,000 and up to one-year imprisonment. The criminal penalties increase
if the wrongful conduct involves false pretenses or the intent to sell, transfer or use identifiable health information for commercial
advantage, personal gain or malicious harm. The amount of penalty that may be assessed depends, in part, upon the culpability
of the applicable covered entity or business associate in committing the violation. Some penalties for certain violations that
were not due to “willful neglect” may be waived by the Secretary of HHS in whole or in part, to the extent that the
payment of the penalty would be excessive relative to the violation. HITECH also authorized state attorneys general to file suit
on behalf of residents of their states. Applicable courts may be able to award damages, costs and attorneys’ fees related
to violations of HIPAA in such cases. HITECH also mandates that the Secretary of HHS conduct periodic compliance audits of a cross-section
of HIPAA covered entities and business associates. Every covered entity and business associate is subject to being audited, regardless
of the entity’s compliance record.

 

State
laws may impose more protective privacy restrictions related to health information and may afford individuals a private right
of action with respect to the violation of such laws. Both state and federal laws are subject to modification or enhancement of
privacy protection at any time. We are subject to any federal or state privacy-related laws that are more restrictive than the
privacy regulations issued under HIPAA. These statutes vary and could impose additional requirements on us and more severe penalties
for disclosures of health information. If we fail to comply with HIPAA, similar state laws or any new laws, including laws addressing
data confidentiality, security or breach notification, we could incur substantial monetary penalties and substantial damage to
our reputation.

 

States
may also impose restrictions related to the confidentiality of personal information that is not considered PHI under HIPAA, including
certain identifying information and financial information of our patients. Theses state laws may impose additional notification
requirements in the event of a breach of such personal information. Failure to comply with such data confidentiality, security
and breach notification laws may result in substantial monetary penalties.

 

HIPAA
and HITECH also include standards for common healthcare electronic transactions and code sets, such as claims information, plan
eligibility and payment information. Covered entities such as the Company and each of our clinics will be required to conform
to such transaction set standards.

 

Telemedicine
Medical Technology Platform, Remote Patient Monitoring Medical Technology Platform and Novo Connect Medical Technology Platform
(collectively, “Medical Technology Platforms”)

 

Both
our Telemedicine Medical Technology Platform and Remote Patient Monitoring Medical Technology Platform are operational in Canada
on a limited usage basis; but are primarily in development. Our Novo Connect Medical Technology Platform is under development.
All of our Medical Technology Platforms, when operational, will be subject to governmental health care regulations in Canada including,
but not limited to, the Canada Health Act. While our Medical Technology Platforms are not currently operational in the United
States, once operational our Medical Technology Platforms usage will be subject to United States laws, regulations, and directives
such as, but not limited to, Medicare, Medicaid, RAC, Anti-Kick Back Statute, False Claims Act, Civil Monetary Penalties Statute,
HIPAA, and HITECH. In addition, we will be subject to data privacy, security and breach notification requirements of United States
federal, state, and local statutes and other data privacy and security laws.

 

Our
Telemedicine Medical Technology Platform and Remote Patient Monitoring Medical Technology Platform, which are both currently in
development with limited usage, are intended to collect and transmit a patient’s personal data, vital statistics and other
medical history information, and both are subject to governmental health care regulations, data privacy, security and breach notification
requirements of United States federal, state, and local statutes and other data privacy and security laws.

 

 

Our
Novo Connect Medical Technology Platform, which is currently in development and once operational will collect and transmits a
patient’s personal data, vital statistics, along with various components of a user’s medical history, and is subject
to both governmental health care regulations and data privacy, security and breach notification requirements of United States
federal, state, and local statutes and other data privacy and security laws.

 

Stark
Law

 

Our
Medical Technology Platforms, once fully operational in the United States, will provide patients with real-time access to third-party
primary care medically licensed physicians, specialists, nurses and nurse practitioners in various medical disciplines as well
as multidisciplinary primary care clinicians. Because we will participate through our Medical Technology Platforms in the Medicare
program, we will also be subject to the Stark Law. Unlike the Fraud and Abuse Law, the Stark Law is a strict liability statute.
Proof of intent to violate the Stark Law is not required. Physical therapy services are among the “designated health services”.
Further, the Stark Law has application to the Company’s management contracts with individual physicians, physician groups,
multidisciplinary primary care clinicians, as well as, any other financial relationship between us and referring physicians, specialists,
nurses and nurse practitioners in various medical disciplines as well as multidisciplinary primary care clinicians, including
any financial transaction resulting from a clinic acquisition. The Stark Law also prohibits billing for services rendered pursuant
to a prohibited referral. Several states have enacted laws like the Stark Law. These state laws may cover all (not just Medicare
and Medicaid) patients. Many federal healthcare reform proposals in the past few years have attempted to expand the Stark Law
to cover all patients as well. As with the Fraud and Abuse Law, we consider the Stark Law in operating our Medical Technology
Platforms and intend to operate our Medical Technology Platforms in compliance with the Stark Law. If we violate the Stark Law,
our financial results and operations could be adversely affected. Penalties for violations include denial of payment for the services,
significant civil monetary penalties, and exclusion from the Medicare and Medicaid programs.

 

E-Commerce

 

We
are subject to general business regulations and laws as well as Federal and provincial regulations and laws specifically governing
the Internet and e-commerce. Existing and future laws and regulations may impede the growth of the use of the Internet, availability
of economic broadband access, or other online services, and increase the cost of providing our digital delivery of content and
services. These regulations and laws may cover taxation, tariffs, user privacy, data protection, pricing, content, copyrights,
distribution, electronic contracts and other communications, consumer protection, broadband internet access and the characteristics
and quality of services. It is not clear how existing laws which govern issues such as property ownership, sales, use and other
taxes, libel and personal privacy apply to the internet and e-commerce. Unfavorable resolution of these issues may harm our business
and results of operations.

 

Medical
Cannabidiol Product

 

As
discussed in the Business Growth Initiative section above, we plan on expanding our business to include the cultivation, processing,
and manufacturing of CBD products in Canada, and the sale and distribution of medicinal CBD products in Canada and authorized
U.S. states. We expect our prospective medicinal CBD products will be specifically focused on CBD for use (i) as a treatment aid;
(ii) to provide relief for a large array of neurological and musculoskeletal system disorders; and (iii) as an alternative option
for health care providers in place of prescribing opioids to patients.

 

Offering
our patients access to non-hallucinogenic and non-addictive natural remedies, under required clinical oversight policies and procedures
as they relate to medicinal cannabis and medicinal CBD, combined with our existing clinic-based treatment protocols, allows us
to enter this market segment with a unique integration model not readily available in the marketplace.

 

Cannabis
versus Hemp

 

While
hemp and cannabis are both derived from the same species (Cannabis sativa), there are major differences in the characteristics
of the respective plant strains that produce industrial hemp on the one hand, and cannabis products on the other. In short, hemp
is a strain of the Cannabis sativa plant that is grown primarily for use in industrial applications. It has been specifically
cultivated to produce a low tetrahydrocannabinol (“THC”) content and a high cannabidiol content. THC is the psychoactive
constituent of cannabis and is responsible for producing the effects of the drug. CBD is another active ingredient present in
Cannabis sativa plants, and it largely acts to neutralize the psychoactive effects of THC. Since hemp strains have extremely low
levels of THC and high levels of CBD, they do not produce psychoactive effects when ingested.

 

 

Canada

 

Cannabis
is legal in Canada for both recreational and medicinal purposes. Medicinal use of cannabis was legalized nationwide on July 30,
2001 under conditions outlined in the Marijuana for Medical Purposes Regulations, later superseded by the Access to Cannabis for
Medical Purposes Regulations, issued by Health Canada and seed, grain, and fiber production was permitted under license by Health
Canada. The federal Cannabis Act came into effect on October 17, 2018 and made Canada the second country in the world to formally
legalize the cultivation, possession, acquisition and consumption of cannabis and its by-products.

 

As
set out in the Cannabis Regulations:

 

 

licenses
are required for:

 

 

cultivating
and processing cannabis
 
 
  

sale
of cannabis for medical purposes or recreational purposes
 
 
  

analytical
testing of and research with cannabis

 

 

permits
are required to import or export:

 

 

cannabis
for scientific or medical purposes
 
 
  

industrial
hemp

 

 

license
holders are subject to strict physical and personnel security requirements

 

 

plain
packaging is required for cannabis products:

 

 

the
Regulations set out strict requirements for:

 

 

logos 
 
  

colors 
 
  

branding

 

 

cannabis
products must also be labelled with:

 

 

mandatory
health warnings
 
 
  

standardized
cannabis symbol
 
 
  

specific
information about the product

 

 

access
to cannabis for medical purposes continues to be provided for patients who need it
 
 
  

manufacturers
of prescription drugs containing cannabis, while primarily subject to the Food and Drugs Act and its Regulations, are also
subject to certain regulatory requirements set out in the Cannabis Regulations

 

 

Patients
authorized by their health care provider are still able to access cannabis for medical purposes by:

 

 

buying
directly from a federally licensed seller
 
 
  

registering
with Health Canada to produce a limited amount of cannabis for their own medical purposes
 
 
  

designating
someone to produce it for them

 

Under
the new regulations, there are improvements for patients accessing cannabis for medical purposes from federally licensed sellers.
These improvements include:

 

 

the
ability to request the return of their medical document from a federally licensed seller
 
 
  

the
ability to request the transfer of their medical document to a different federally licensed seller
 
 
  

that
the effective date on the registration document will be the day it is issued, rather than the day the medical document was
signed by the health care provider
 
 
  

removal
of the 30-day limitation period for buying cannabis from a federally licensed seller (to ensure no break in a patient’s
supply)
 
 
  

a
broader range of permitted products
 
 
  

access
to an increasing number of licensed producers and sellers (Health Canada has licensed more producers in the last year than
in the 4 previous years combined). The increasing number of licensed producers enables:

 

 

competitive
prices
 
 
  

more
supply of cannabis
 
 
  

an
increased availability of a range of products

 

United
States

 

Until
2014, when 7 U.S. Code §5940 became federal law as part of the Agricultural Act of 2014 (the “2014 Farm Act”),
products containing oils derived from hemp, notwithstanding a minimal or non-existing THC content, were classified as Schedule
I illegal drugs. The 2014 Farm Act expired on September 30, 2018, and was thereafter replaced by the Agricultural Improvement
Act of 2018 on December 20, 2018 (the “2018 Farm Act “), which amended various sections of the U.S. Code, thereby
removing hemp, defined as cannabis with less than 0.3% of THC, from Schedule 1 status under the Controlled Substances Act (“CSA”),
and legalizing the cultivation and sale of hemp at the federal level, subject to compliance with certain federal requirements
and state law, amongst other things. THC is the psychoactive component of plants in the cannabis family generally identified as
marihuana or marijuana. We anticipate that our prospective medicinal CBD products will be federally legal in the United States
in that they will contain less than 0.3% of THC in compliance with the 2018 Farm Bill guidelines and will have no psychoactive
effects on our patients’ and customers’ bodies. Notwithstanding, there is no assurance that the 2018 Farm Act will
not be repealed or amended such that our prospective products containing hemp-derived CBD would once again be deemed illegal under
federal law.

 

The
2018 Farm Bill also shifted regulatory authority from the Drug Enforcement Administration to the Department of Agriculture. The
2018 Farm Bill did not change the United States Food and Drug Administration’s (“FDA”) oversight authority over
CBD products. The 2018 Farm Act delegated the authority to the states to regulate and limit the production of hemp and hemp derived
products within their territories. Although many states have adopted laws and regulations that allow for the production and sale
of hemp and hemp derived products under certain circumstances, no assurance can be given that such state laws may not be repealed
or amended such that our intended products containing hemp-derived CBD would once again be deemed illegal under the laws of one
or more states now permitting such products, which in turn would render such intended products illegal in those states under federal
law even if the federal law is unchanged. In the event of either repeal of federal or of state laws and regulations, or of amendments
thereto that are adverse to our prospective medical CBD products, we may be restricted or limited with respect to those products
that we may sell or distribute, which could adversely impact our intended business plan with respect to such intended products.

 

 

Additionally,
the FDA has indicated its view that certain types of products containing CBD may not be permissible under the United States Federal
Food, Drug and Cosmetic Act (“FDCA”). The FDA’s position is related to its approval of Epidiolex, a marijuana-derived
prescription medicine to be available in the United States. The active ingredient in Epidiolex is CBD. On December 20, 2018, after
the passage of the 2018 Farm Bill, FDA Commissioner Scott Gottlieb issued a statement in which he reiterated the FDA’s position
that, among other things, the FDA requires a cannabis product (hemp-derived or otherwise) that is marketed with a claim of therapeutic
benefit, or with any other disease claim, to be approved by the FDA for its intended use before it may be introduced into interstate
commerce and that the FDCA prohibits introducing into interstate commerce food products containing added CBD, and marketing products
containing CBD as a dietary supplement, regardless of whether the substances are hemp-derived. Although we believe our prospective
medicinal CBD product offering will comply with applicable federal and state laws and regulations, legal proceedings alleging
violations of such laws could have a material adverse effect on our business, financial condition and results of operations.

 

We
do not intend to offer, and we do not intend to compete with companies that offer, cannabis products containing high levels of
psychoactive THC. Although legal in some states, and in Canada, we do not intend to enter into this market. We may offer prospective
medicinal CBD (hemp-based) products to patients and customers but will not compete with any medical or recreational marijuana
sellers of products for high THC content sales due to legal and regulatory restrictions and uncertainty in the United States.
Because of regulatory challenges facing marijuana companies in the United States, the vast majority of the companies focused on
THC are Canadian and foreign, although several have begun to pursue domestic activities in states that permit marijuana sales.
Federal law does not generally recognize marijuana (or hemp that exceeds 0.3% THC) as lawful, although that may change in the
future.

 

Corporate
History

 

Novo
Integrated Sciences, Inc. was incorporated in Delaware on November 27, 2000, under the name Turbine Truck Engines, Inc. On February
20, 2008, Novo Integrated was re-domiciled to the State of Nevada. Effective July 12, 2017, the Company’s name was changed
to Novo Integrated Sciences, Inc.

 

Since
inception and through May 9, 2017, our activities and business operations were limited to raising capital, organizational matters
and the implementation of our business plan related to research, development, testing and commercialization of various alternative
energy technologies.

 

On
September 5, 2013, NHL was incorporated under the laws of Ontario province Canada. On September 16, 2013, Novo Assessments Inc.,
Novo Community Care Inc, and Novo Healthnet Rehab Limited were formed, under the laws of Ontario province Canada, as wholly owned
subsidiaries of NHL. On September 20, 2013, Novo Community Care Inc.’s name was changed to Novo Peak Health Inc. On September
30, 2013, NHL acquired substantially all the assets of the following operational Ontario Canada based entities, (i) Peak Health
LTC Inc.; (ii) ICC Healthnet Canada Inc. and its related companies; and (iii) Michael Gaynor Physiotherapy Professional Corporation,
operating as Back on Track. On November 18, 2014, Novo Healthnet Kemptville Centre, Inc., was formed under the laws of Ontario
province Canada, with NHL owning an 80% interest. On April 1, 2017, NHL purchased substantially all of the assets of APKA Health,
an occupational therapy entity operating in Ontario province Canada.

 

Acquisition
of Novo Healthnet Limited

 

On
April 25, 2017 (the “Effective Date”), the Company entered into a Share Exchange Agreement (the “Share Exchange
Agreement”) by and between (i) the Company; (ii) NHL; (iii) ALMC-ASAP Holdings Inc. (“ALMC”); (iv) Michael Gaynor
Family Trust (the “MGFT”); (v) 1218814 Ontario Inc. (“1218814”); and (vi) Michael Gaynor Physiotherapy
Professional Corp.; and collectively ALMC, MGFT and 1218814 herein referred to as “the NHL Shareholders”). Pursuant
to the terms of the Share Exchange Agreement, the Company agreed to acquire, from the NHL Shareholders, all of the shares of both
common and preferred stock of NHL, held by the NHL Shareholders, in exchange for the issuance by the Company, to the NHL Shareholders,
shares of the Company’s common stock, such that following the closing of the Share Exchange Agreement, the NHL Shareholders
would own 16,779,741 restricted shares of Company common stock, representing 85% of the issued and outstanding Company
common stock, calculated including all granted and issued options or warrants to acquire the Company common stock as of the Effective
Date, but to exclude shares of Company common stock that are subject to a then-current Regulation S Offering that was undertaking
by the Company (the “Exchange”).

 

 

On
May 9, 2017, the Exchange closed and, as a result, NHL became a wholly owned subsidiary of Novo Integrated Sciences, Inc.

 

Acquisition
of Executive Fitness Leaders

 

On
December 1, 2017, the Company, NHL and Executive Fitness Leaders, located in Ottawa Ontario Canada, entered into an Asset Purchase
Agreement, pursuant to which NHL acquired substantially all of the assets of Executive Fitness Leaders in exchange for the issuance,
by the Company, of 38,411 restricted shares of its common stock.

 

Formation
of Novomerica Health Group, Inc. in U.S.

 

On
November 3, 2017, Novomerica Health Group, Inc. was incorporated, under the laws of the state of Nevada, as a wholly owned subsidiary
of Novo Integrated Sciences, Inc. for the purpose of expanding the Company’s operations into the United States.

 

Novo
Peak Health Inc. Amalgamated with NHL

 

On
September 25, 2018, Novo Peak Health, Inc. was amalgamated with Novo Healthnet Limited.

 

Assignment
of Joint Venture Agreement

 

On
January 7, 2019, 2478659 Ontario Ltd. (“247”) and Kainai Cooperative (“Kainai”) entered into a Joint Venture
Agreement (the “Joint Venture Agreement”) for the purpose of developing, managing and arranging for financing of greenhouse
and farming projects involving hemp and cannabis cash crops on Kainai related lands, and developing additional infrastructure
projects creating jobs and food supply to local communities. On January 8, 2019, we and 247 entered into an Agreement of Transfer
and Assignment, pursuant to which 247 agreed to sell, assign and transfer to the Company all rights, contracts, contacts and any
and all other assets related in any way to the Joint Venture Agreement. Pursuant to the terms of the Joint Venture Agreement,
as assigned to us, the parties will work in a joint venture relationship with the Company providing the finance, development and
operation of the project, including sales, and Kainai providing the land and approvals for the development of the projects.

 

The
joint venture will distribute to the Company and Kainai all net proceeds after debt and principal servicing and repayment allocation,
as well as operating capital allotment, on a ratio equal to 80% to the Company and 20% to Kainai.

 

The
Joint Venture Agreement has an initial term of 50 years and Kainai may renew the Joint Venture Agreement within five years of
the expiry of the initial term upon mutual agreement.

 

On
January 30, 2019, pursuant to the terms of the Joint Venture Agreement, the Company issued 1,200,000 restricted common
shares to 247 with a value of $21,600,000.

 

Cloud
DX Inc. License Agreement

 

On
February 26, 2019, Novo Integrated Sciences, Inc. (the “Company”) and Novo Healthnet Limited (“NHL”) entered
into a Software License Agreement (the “Cloud DX License”) with Cloud DX Inc. (“Cloud DX”) pursuant to
which Cloud DX agreed to sell, and NHL agreed to purchase, a fully paid up, perpetual license, with 5-year conditional exclusivity,
for the Cloud DX Bundled Pulsewave PAD-1A USB Blood Pressure Device, up-to-date product releases and Licensed Software Products
(the “Licensed Software”) to include the:

 

 

Cloud
DX Connected Health web portal for clinical users,
 

Cloud
DX Connected Health mobile app,
 

Cloud
DX Connected Health Windows app, and

 

 

 

Cloud
DX Connected Health MacOS app.

 

Pursuant
to the terms of the Cloud DX License, Cloud DX also agreed to sell, and NHL agreed to purchase, 4,000 fully functional Pulsewave
PAD 1A USB blood pressure monitor devices bundled with the perpetual license discussed above (the “Bundled Devices”).

 

The
Cloud DX platform allows NHL to further expand on its patient care philosophy of maintaining an on-going continuous connection
with its patient community, beyond the traditional confines of a clinic, extending oversight of patient care and monitoring directly
into the patient’s home through Remote Patient Monitoring (“RPM”). The Cloud DX technology empowers a patient
with real-time vital sign information while maintaining a direct technology link from patient to clinician or medical practitioner.
The transfer of vital information from home to clinic or patient to clinician further allows our clinicians and practitioners
to deliver non-redundant diagnostic based proactive multidisciplinary primary health care.

 

The
Cloud DX License grants NHL and its majority-owned subsidiaries, holding companies, and affiliates, with the exception of physiotherapy
clinics owned and operated by Closing The Gap Healthcare Inc., the right to use and sub-license the Licensed Software and re-sell
the Bundled Devices pursuant to the terms of the Cloud DX License in the physical therapy clinic marketplace in North America
in exchange for the purchase price as set forth below:

 


Upon the closing, the Company issued 45,835 restricted shares of its common stock having a value (as calculated as set
forth in the Cloud DX License) of CAD$1,000,000 (approximately $758,567 as of February 26, 2019), and

 


Cloud DX will invoice CAD$250,000 (approximately $189,642 as of February 26, 2019) to NHL based on the following deliverables,
and paid on the following schedule:

 

Cloud
DX deliverable

 
Novo
payment (terms: Net 15)
Heart
Friendly Program launches in Clinic #1

 
CAD$50,000
(approximately $37,929 as of February 26, 2019)
Novo-branded
Android app delivered as APK file

 
CAD$35,000
(approximately $26,550 as of February 26, 2019)
Novo-branded
Clinical portal website delivered

 
CAD$35,000
(approximately $26,550 as of February 26, 2019)
Pulsewave
PAD-1A devices – 1st delivery

 
CAD$20,000
(approximately $15,171 as of February 26, 2019)
Marketing
services / materials delivered

 
CAD$25,000
(approximately $18,964 as of February 26, 2019)
Cloud
DX hires dedicated Novo support FTE

 
CAD$85,000
(approximately $64,478 as of February 26, 2019)

 

On
March 9, 2020, the Company and NHL entered into that certain First Amendment to Cloud DX Perpetual Software License Agreement
(the “Cloud DX Amendment”) with Cloud DX, effective March 6, 2020, pursuant to which the parties thereto agreed that
the CAD$250,000 (approximately $186,231 as of March 6, 2020) that was to be paid by NHL based on the above deliverables would
be paid as a one-time payment of 46,558 restricted shares of Company common stock. In addition, pursuant to the terms of
the Cloud DX Amendment, the parties agreed to settle a $200,000 fee owed by NHL to Cloud DX through payment of 50,000 restricted
shares of Company common stock.

 

Pursuant
to the terms of the Cloud DX License, the perpetual license with 5-year conditional exclusivity is subject to the following conditions:

 

(a)Year
1 – NHL has the right to sell and market the Licensed Software exclusively to “Physical
Therapy Clinics,” as hereinafter defined, in Canada and the U.S. for the first
5 years after the execution date of the Cloud DX License, with the exception of clinics
operated by Closing the Gap Healthcare. “Physical Therapy Clinics” means
any clinic that offers para-medical services focused on physical therapy, orthotics,
chiropractic, nutrition, massage, wellness, esthetic and cosmetic services (e.g. “botox”,
“restylane”) and related non-medical services, sometimes called “multi-disciplinary
clinics”, and excludes pharmacies and services offered by licensed medical professionals
including medical doctors (MD/PhD), nurses, nurse practitioners, physician assistants,
licensed practical nurses and staff that deliver medical care.

 

 

(b)During
the 5-year initial period, NHL is expected to sell a minimum of 4,000 Bundled Devices
and to sell a minimum of 200 franchises.
(c)In
Year 6 and beyond, additional 1-year periods of conditional exclusivity will be granted
provided that NHL sales in the preceding 12 months are equal to total sales achieved
in Year 5.
(d)If
the minimums set forth in item (b) above are not met, continued exclusivity will require
the payment of an additional fee, to be negotiated in good faith between the parties.
(e)2-Way
Exclusivity – NHL agrees not to replace the Software and Bundled Devices or offer
a competitive offering as long as NHL is representing the Cloud DX product line.

 

Acquisition
of Societe Professionnelle de Physiotherapie M Dignard, carrying on business as Action Plus Physiotherapy Rockland

 

On
July 22, 2019, the Company and Societe Professionnelle de Physiotherapie M Dignard, carrying on business as Action Plus Physiotherapy
Rockland and providing physiotherapy and related ancillary services (“APPR”), entered into an Asset Purchase Agreement
(“APA”) pursuant to which APPR agreed to sell, assign and transfer to the Company, free and clear of all encumbrances,
other than permitted encumbrances, and the Company agreed to purchase from APPR all of APPR’s right, title and interest
in and to all of its assets, with the exception of certain limited exclusions, and the rights, privileges, claims and properties
of any kind whatsoever that are related thereto, whether owned or leased, real or personal, tangible or intangible, of every kind
and description and wheresoever situated.

 

Pursuant
to the terms of the APA, the purchase price is determined as six times APPR’s purported EBITDA, equaling CAD$300,000, of
which, APPR (1) received a cash payment of CAD$175,000; and (2) was issued CAD$125,000 worth of the Company’s common stock,
par value $0.001, as restricted common shares pursuant to an exemption from registration as set forth in Regulation S under the
Securities Act. Pursuant to the terms of the APA, APPR was issued 8,456 restricted common shares of the Company’s
common stock as consideration for the CAD$125,000 payment owed to APPR. On the business day immediately preceding the closing
date of the APA, determined as July 19, 2019, the CAD-to-USD conversion rate, per x-rates.com, was 0.7644 which converts CAD$125,000
to $95,550 rounded to the nearest whole number dollar amount. Based on the determined 30-trading day closing average price per
share of $11.30, the calculated number of the Company’s restricted common shares issued to APPR was 8,456,
which includes rounding the calculation up to the nearest whole number of shares.

 

The
transaction closed on July 22, 2019. The purchase of these assets was not considered significant for accounting purposes; therefore,
pro forma financial statements were not presented.

 

U.S.
LA Fitness License Agreement & Guaranty

 

On
September 24, 2019, Novomerica Health Group Inc. (“Novomerica”), a wholly owned subsidiary of the Company, entered
into a Master Facility License Agreement with Fitness International, LLC and Fitness & Sports Clubs, LLC (together with Fitness
International, LLC, “LA Fitness U.S.”). The Master Facility License Agreement was amended on February 4, 2020, pursuant
to the terms of that certain First Amendment to Master Facility License Agreement between Novomerica and Fitness International,
LLC (“U.S. License Agreement”).

 

Pursuant
to the terms of the U.S. License Agreement, the parties agreed that from time to time as set forth in the U.S. License Agreement
or as the parties otherwise agree, Novomerica may wish to identify sublicensees to provide certain services in facilities operated
by LA Fitness U.S., and LA Fitness U.S. may desire to grant to such sublicenses the right to do the same. Upon execution of applicable
documentation as may be required by the U.S. License Agreement, the sublicensee (which may be Novomerica, if Novomerica desires
to provide Services (as hereinafter defined) itself) shall have the right, subject to the terms of the U.S. License Agreement,
to (i) occupy and use, on an exclusive basis, for the purposes of providing outpatient physical and/or occupational therapy as
provided in the U.S. License Agreement (the “Services”), with the applicable LA Fitness U.S. facility, and (ii) access
and use, on a non-exclusive basis, for the purpose of providing the Services, the applicable facility’s equipment and a
pool lane, and (iii) use, on a non-exclusive basis, the applicable facility’s common areas solely as necessary to access
the facility’s service area, equipment and a pool lane.

 

 

Pursuant
to the terms of the U.S. License Agreement, five separate initial licenses in Ohio were granted. Novomerica agreed to develop
and open for business (a) at least two of such facilities by June 30, 2020, (b) at least two additional facilities by September
30, 2020, and (c) the final remaining facility by December 31, 2020 (“U.S. Development Schedule”). Pursuant to the
terms of the U.S. License Agreement, in the event that Novomerica fails to meet the U.S. Development Schedule, the initial licenses
that Novomerica has developed and opened for business will remain unaffected; however, Novomerica will lose the right to develop
the remaining licenses.

 

With
respect to each license granted under the U.S. License Agreement, for the period beginning as of the commencement date of each
such license and continuing until the expiration or earlier termination of such license, Novomerica shall pay to LA Fitness U.S.
a monthly payment in an agreed upon amount.

 

Unless
sooner terminated as provided in the U.S. License Agreement, the term of the U.S. License Agreement shall expire simultaneously
with the expiration of earlier termination of the License Term (as such term is defined in the U.S. License Agreement) of the
last remaining license granted under the U.S. License Agreement.

 

Pursuant
to the terms of the U.S. License Agreement, the Company agreed to execute that certain Guaranty Agreement (the “U.S. Guaranty”)
dated September 24, 2019 by and between the Company and LA Fitness U.S. Pursuant to the terms of the U.S. Guaranty, the Company
irrevocably guaranteed the full, unconditional and prompt payment and performance of all of Novomerica’s obligations and
liabilities under the U.S. License Agreement.

 

Canada
LA Fitness License Agreement & Guaranty

 

On
September 24, 2019, NHL entered into a Master Facility License Agreement with LAF Canada Company (“LA Fitness Canada”).
The Master Facility License Agreement was amended on February 4, 2020, pursuant to the terms of that certain First Amendment to
Master Facility License Agreement between NHL and LA Fitness Canada (“Canada License Agreement”).

 

Pursuant
to the terms of the Canada License Agreement, the parties agreed that from time to time as set forth in the Canada License Agreement
or as the parties otherwise agree, NHL may wish to identify sublicensees to provide certain services in facilities operated by
LA Fitness Canada, and LA Fitness Canada may desire to grant to such sublicensees the right to do the same. Upon execution of
applicable documentation as may be required by the Canada License Agreement, the sublicensee (which may be NHL, if NHL desires
to provide Services (as hereinafter defined) itself) shall have the right, subject to the terms of the Canada License Agreement,
to (i) occupy and use, on an exclusive basis, for the purposes of providing the Services, with the applicable LA Fitness Canada
facility, and (ii) access and use, on a non-exclusive basis, for the purpose of providing the Services, the applicable facility’s
equipment and a pool lane, and (iii) use, on a non-exclusive basis, the applicable facility’s common areas solely as necessary
to access the facility’s service area, equipment and a pool lane.

 

Pursuant
to the terms of the Canada License Agreement, 17 separate initial licenses in Ontario, Canada and Alberta, Canada were granted.
NHL agreed to develop and open for business (a) at least four of such facilities by March 31, 2020, (b) at least six additional
facilities by June 30, 2020, (c) at least six additional facilities by September 30, 2020, and (4) the final remaining facility
by December 31, 2020 (the “Canada Development Schedule”). Pursuant to the terms of the Canada License Agreement, in
the event that NHL fails to meet the Canada Development Schedule, the initial licenses that NHL has developed and opened for business
will remain unaffected; however, NHL will lose the right to develop the remaining licenses.

 

With
respect to each license granted under the Canada License Agreement, for the period beginning as of the commencement date of each
such license and continuing until the expiration or earlier termination of such license, NHL shall pay to LA Fitness Canada a
monthly payment in an agreed upon amount.

 

Unless
sooner terminated as provided in the Canada License Agreement, the term of the Canada License Agreement shall expire simultaneously
with the expiration of earlier termination of the License Term (as such term is defined in the Canada License Agreement) of the
last remaining license granted under the Canada License Agreement.

 

 

Pursuant
to the terms of the Canada License Agreement, the Company agreed to execute that certain Guaranty Agreement (the “Canada
Guaranty”) dated September 24, 2019 by and between the Company and LA Fitness Canada. Pursuant to the terms of the Canada
Guaranty, the Company irrevocably guaranteed the full, unconditional and prompt payment and performance of all of NHL’s
obligations and liabilities under the Canada License Agreement.

 

Intellectual
Property Asset Purchase Agreement

 

On
December 17, 2019, the Company entered into that certain Intellectual Property Asset Purchase Agreement (the “APA”)
by and between the Company and 2731861 Ontario Corp. (the “Seller”), pursuant to which the Company agreed to purchase,
and Seller agreed to sell (the “Acquisition”), proprietary designs for an innovative cannabis dosing device, in addition
to designs, plans, procedures, and all other material pertaining to the application, construction, operation, and marketing of
a cannabis business under the regulations of Health Canada (the “Intellectual Property”). Pursuant to the terms of
the APA, the purchase price of the Intellectual Property is 800,000 shares of restricted common stock of the Company. The
Acquisition closed on December 17, 2019.

 

Joint
Venture Agreement

 

On
December 19, 2019, the Company entered into that certain Joint Venture Agreement (the “JV Agreement”) between the
Company and Harvest Gold Farms Inc. (“HGF”) relating to the development, management and arrangement of medicinal farming
projects involving hemp and cannabis cash crops (the “Project”). Pursuant to the terms of the JV Agreement, the parties
agreed to work in a joint venture relationship, with the Company providing the development and operation of the Project, including
sales, and HGF providing the land, farming expertise, biomass and necessary approvals for the development of the Project.

 

The
initial term of the JV Agreement will, unless sooner terminated by consent of all parties, expire in five years from the effective
date of the JV Agreement. The Company and HGF may renew the JV Agreement within two years of the expiration of the initial term
upon mutual understanding.

 

Each
of the parties agreed to contribute to the start-up of the joint venture (the “JV”) as follows:

 

oComplete
and finalize a business plan and layout plans, a detailed procurement project binder
and an implementation and roll-out plan.
oMake
arrangements for construction and financing options of any facilities required for the
profitable farming of medicinal crops or related facilities.
oDirect
project finance model and selection of engineering, procurement, construction contracts
and management service providers.
oArrange
for product purchase contracts.

 

oProvide
the land and approvals for greenhouse (if necessary), open field farming and other facilities
as required.
oArrange
for all required titled land for greenhouses and outdoor agriculture platforms.
oArrange
for all building permits, environmental approvals and HGF internal approvals including
confirmation of tax-free JV status for the duration of the proposal (if possible).
oProvide
elite farming expertise for the purposes of maximizing potential profits, inclusive of
harvesting techniques and process flow and engineering.

 

Pursuant
to the terms of the JV Agreement, the Company agreed to maintain all financial records (in U.S. GAAP) of the JV, to provide quarterly
and annual reporting to all JV stakeholders, and to assign and direct operational staff from onset to agreement termination. The
Company agreed to pay HGF 30% of net JV income on an annual basis commencing 12 months after the first full 12-month revenue period,
and to purchase product from the JV at a price of cost plus 5%.

 

In
addition, the Company agreed to issue 200,000 shares of Company common stock upon achievement of $25,000,000 of net profit
by the JV each fiscal year. Such common stock will be delivered to HGF via Novo Healthnet Limited exchangeable preferred shares.
Any Company common stock issued to HGF will be subject to pro-rata adjustment in the event that the Company approves, prior to
the issuance date, any forward stock split, reverse stock split or other capitalization restructure.

 

 

HGF
agreed, among other things, to grow medicinal agriculture crop at the highest standard, subject to independent third party biomass
testing, in the most profitable manner while maintaining the standards of excellence required to maintain elite status, and to
provide a minimum of 7,000 acres for the Primary Project. All staffing, including but not limited to, management, specialized
or general labor requirements for farming will be the sole responsibility of HGF.

 

Approval
of Novo Integrated Sciences, Inc. 2018 Incentive Plan

 

On
January 16, 2018, the Company adopted the Novo Integrated Sciences, Inc. 2018 Incentive Plan (the “2018 Plan”). Under
the 2018 Plan, 1,000,000 shares of common stock are authorized for the grant of stock options and the issuance of restricted
stock, stock appreciation rights, phantom stock and performance awards to officers, directors, employees and eligible consultants
to the Company or its subsidiaries. As of August 31, 2020, the 2018 Plan has 937,500 shares available for award.

 

Approval
of Novo Integrated Sciences, Inc. 2021 Equity Incentive Plan

 

On
February 9, 2021, our Board of Directors and stockholders holding a majority of our outstanding common stock approved the 2021
Plan. Under the 2021 Plan, a total of 4,500,000 shares of common stock are authorized for issuance pursuant to the grant of stock
options, stock appreciation rights, restricted stock, restricted stock units, performance units, performance shares or other cash-
or stock-based awards to officers, directors, employees and eligible consultants to the Company or its subsidiaries. Subject to
adjustment as provided in the 2021 Plan, the maximum aggregate number of shares that may be issued under the 2021 Plan will be
cumulatively increased on January 1, 2022 and on each subsequent January 1 through and including January 1, 2023, by a number
of shares equal to the smaller of (i) 3% of the number of shares of common stock issued and outstanding on the immediately preceding
December 31, or (ii) an amount determined by our Board of Directors. As of February 19, 2021, the 2021 Plan has 4,500,000
shares available for award.

 

RISK
FACTORS

 

Material
factors that may adversely affect our business and operations are summarized below. The risks and uncertainties described herein
may not be the only ones we face. Additional risks and uncertainties not presently known to us or that we currently believe to
be immaterial may also adversely affect our business. See “Cautionary Statement Regarding Forward-Looking Statements and
Risk Factor Summary” above.

 

History
of operating losses and negative cash flow.

 

For
the fiscal years ended August 31, 2020 and 2019, we reported net losses of $ 4,924,209 and $403,579, respectively, and negative
cash flow from operating activities of $441,694 and $822,268, respectively. As of August 31, 2020, we had an aggregate accumulated
deficit of $16,507,127.

 

Such
losses have historically required us to seek additional funding through the issuance of debt or equity securities. Our long-term
success is dependent upon among other things, achieving positive cash flows from operations and if necessary, augmenting such
cash flows using external resources to satisfy our cash needs. There can be no assurance that we will be able to obtain additional
funding, if needed, on commercially reasonable terms, or of all.

 

Our
consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. These
adjustments would likely include substantial impairment of the carrying amount of our assets and potential contingent liabilities
that may arise if we are unable to fulfill various operational commitments. In addition, the value of our securities would be
greatly impaired. Our long-term success is dependent upon generating sufficient cash flow from operations and obtaining additional
capital and financing. If our ability to generate cash flow from operations is delayed or reduced and we are unable to raise additional
funding from other sources, we may be unable to continue in business.

 

 

Novo
Integrated Sciences, Inc. is a parent company and depends upon our subsidiaries for our cash flows.

 

We
are a parent company. All of our operations are conducted, and some of our assets are owned, by our subsidiaries. Consequently,
our cash flows and our ability to meet our obligations depend upon the cash flows of our subsidiaries and the payment of funds
by these subsidiaries to us in the form of dividends, distributions or otherwise. The ability of our subsidiaries to make any
payments to us depends on their earnings, the terms of their indebtedness, including the terms of any credit facilities and legal
restrictions. Any failure to receive dividends or distributions from our subsidiaries when needed could have a material adverse
effect on our business, results of operations or financial condition.

 

Future
acquisitions or strategic investments could disrupt our business and harm our business, results of operations or financial condition.

 

We
may in the future explore potential acquisitions of companies or strategic investments to strengthen our business. Even if we
identify an appropriate acquisition candidate, we may not be successful in negotiating the terms or financing of the acquisition,
and our due diligence may fail to identify all of the problems, liabilities or other shortcomings or challenges of an acquired
business.

 

Acquisitions
involve numerous risks, any of which could harm our business, including:

 

●       straining
our financial resources to acquire a company;

 

●       anticipated
benefits may not materialize as rapidly as we expect, or at all;

 

●       diversion
of management time and focus from operating our business to address acquisition integration challenges;

 

●       retention
of employees from the acquired company;

 

●       cultural
challenges associated with integrating employees from the acquired company into our organization;

 

●       integration
of the acquired company’s accounting, management information, human resources and other administrative systems;

 

●       the
need to implement or improve controls, procedures and policies at a business that prior to the acquisition may have lacked effective
controls, procedures and policies; and

 

●       litigation
or other claims in connection with the acquired company, including claims from terminated employees, former stockholders or other
third parties.

 

Failure
to appropriately mitigate these risks or other issues related to such strategic investments and acquisitions could result in reducing
or eliminating any anticipated benefits of transactions and harm our business generally. Future acquisitions could also result
in dilutive issuances of our equity securities, the incurrence of debt, contingent liabilities, amortization expenses or the impairment
of goodwill, any of which could have a material adverse effect on business, results of operations or financial condition.

 

We
may require additional funding for our growth plans, and such funding may result in a dilution of your investment.

 

We
have estimated our funding requirements in order to implement our growth plans. If the costs of implementing such plans should
exceed these estimates significantly or if we come across opportunities to grow through expansion plans which cannot be predicted
at this time, and our funds generated from our operations prove insufficient for such purposes, we may need to raise additional
funds to meet these funding requirements.

 

These
additional funds may be raised by issuing equity or debt securities or by borrowing from banks or other resources. We cannot assure
you that we will be able to obtain any additional financing on terms that are acceptable to us, or at all. If we fail to obtain
additional financing on terms that are acceptable to us, we will not be able to implement such plans fully if at all. Such financing
even if obtained, may be accompanied by conditions that limit our ability to pay dividends or require us to seek lenders’
consent for payment of dividends, or restrict our freedom to operate our business by requiring lender’s consent for certain
corporate actions.

 

 

Further,
if we raise additional funds by way of a rights offering or through the issuance of new shares, any shareholders who are unable
or unwilling to participate in such an additional round of fund raising may suffer dilution in their investment.

 

Most
of our executive officers do not reside in the United State.

 

Our
U.S. stockholders would face difficulty in:

 

●       Effecting
service of process within the United States on most of our executive officers, if considered necessary.

 

●       Enforcing
judgments obtained in U.S. courts based on the civil liability provisions of the U.S. federal securities laws against the executive
officers.

 

●       Enforcing
judgments of U.S. courts based on civil liability provisions of U.S. federal securities laws in foreign courts against the executive
officers.

 

●       Bringing
an original action in foreign courts to enforce liabilities based on the U.S. federal securities laws against the executive officers.

 

Accordingly,
persons contemplating an investment in our common stock should seriously consider these factors before making an investment decision.

 

Robert
Mattacchione, our Chief Executive Officer, has voting control, which will limit your ability to influence the outcome of important
transactions, including a change in control.

 

As
of February 19, 2021, Mr. Mattacchione, our Chairman of the Board and Chief Executive Officer, beneficially owns shares
representing approximately 54.3% of the voting power of our outstanding common stock. As a result, Mr. Mattacchione controls
a majority voting power and therefore is able to control all matters submitted to our shareholders for approval. Mr. Mattacchione
may have interests that differ from yours and may vote in a way with which you disagree and which may be adverse to your interests.
This concentrated voting power may have the effect of delaying, preventing or deterring a change in control of our company, could
deprive our shareholders of an opportunity to receive a premium for their capital stock as part of a sale of our company and might
ultimately affect the market price of our common stock.

 

As
a board member, Mr. Mattacchione owes a fiduciary duty to our shareholders and must act in good faith and in a manner he reasonably
believes to be in the best interests of our shareholders. As a shareholder, Mr. Mattacchione is entitled to vote his shares in
his own interest, which may not always be in the interests of our shareholders generally.

 

Our
future success depends on the continuing efforts of our key employees and our ability to attract, hire, retain and motivate highly
skilled and creative employees in the future.

 

Our
future success depends on the continuing efforts of our executive officers, our founders and other key employees, in particular
Robert Mattacchione, our Chief Executive Officer, and Thomas Bray, our Principal Financial Officer. We rely on the leadership,
knowledge and experience that our executive officers, founders and key employees provide. They foster our corporate culture, which
we believe has been instrumental to our ability to attract and retain new talent. Any failure to attract new or retain key creative
talent could have a material adverse effect on our business, financial condition and results of operations.

 

The
market for talent in our key areas of operations is intensely competitive, which could increase our costs to attract and retain
talented employees. As a result, we may incur significant costs to attract and retain employees, including significant expenditures
related to salaries and benefits and compensation expenses related to equity awards, and we may lose new employees to our competitors
or other companies before we realize the benefit of our investment in recruiting and training them.

 

 

Employee
turnover, including changes in our management team, could disrupt our business. The loss of one or more of our executive officers,
founders or other key employees, or our inability to attract and retain highly skilled and creative employees, could have a material
adverse effect on our business, results of operations or financial condition.

 

We
believe our corporate culture has contributed to our success and, if we are unable to maintain it as we grow, our business could
be harmed.

 

We
believe our corporate culture has been a key element of our success. However, as our organization grows, it may be difficult to
maintain our culture, which could reduce our ability to attract and maintain new talent and operate effectively. The failure to
maintain the key aspects of our culture as our organization grows could result in decreased employee satisfaction, increased difficulty
in attracting top talent and increased turnover and could compromise the quality of our client service, all of which are important
to our success and to the effective execution of our business strategy. Accordingly, if we are unable to maintain our corporate
culture as we grow our business, this could have a material adverse effect on our business, results of operations or financial
condition.

 

We
may not have sufficient insurance coverage and an interruption of our business or loss of a significant amount of property could
have a material adverse effect on our financial condition and operations.

 

We
currently do not maintain any insurance policies against loss of key personnel and business interruption as well as product liability
claims. If such events were to occur, our business, financial performance and financial position may be materially and adversely
affected.

 

We
could become involved in claims or litigations that may result in adverse outcomes.

 

From
time-to-time we may be involved in a variety of claims or litigations. Such proceeding may initially be viewed as immaterial but
could prove to be material. Litigations are inherently unpredictable and excessive verdicts do occur. Given the inherent uncertainties
in litigation, even when we can reasonably estimate the amount of possible loss or range of loss and reasonably estimable loss
contingencies, the actual outcome may change in the future due to new developments or changes in approach. In addition, such claims
or litigations could involve significant expense and diversion of management’s attention and resources from other matters.

 

We
may be unable to adequately safeguard our intellectual property or we may face claims that may be costly to resolve or that limit
our ability to use such intellectual property in the future.

 

Where
litigation is necessary to safeguard our intellectual property, or to determine the validity and scope of the proprietary rights
of others, this could result in substantial costs and diversion of our resources and could have a material adverse effect on our
business, financial condition, operating results or future prospects.

 

We
are unable to assure you that third parties will not assert infringement claims against us in respect of our intellectual property
or that such claims will not be successful. It may be difficult for us to establish or protect our intellectual property against
such third parties and we could incur substantial costs and diversion of management resources in defending any claims relating
to proprietary rights. If any party succeeds in asserting a claim against us relating to the disputed intellectual property, we
may need to obtain licenses to continue to use the same. We cannot assure you that we will be able to obtain these licenses on
commercially reasonable terms, if at all. The failure to obtain the necessary licenses or other rights could cause our business
results to suffer.

 

We
could be adversely affected by violations of the U.S. Foreign Corrupt Practices Act and similar international anti-bribery and
anti-kickback laws with respect to our activities outside the United States.

 

We
anticipate rendering multidisciplinary primary health care services through our clinics and distributing our medical cannabidiol
products to locations in Canada and United States as well as operate our business in Canada and United States. The U.S. Foreign
Corrupt Practices Act, and other similar anti-bribery and anti-kickback laws and regulations, generally prohibit companies and
their intermediaries from making improper payments to non-U.S. officials for the purpose of obtaining or retaining business. We
cannot assure you that we will be successful in preventing our agents from taking actions in violation of these laws or regulations.
Such violations, or allegations of such violations, could disrupt our business and result in a material adverse effect on our
financial condition, results of operations and cash flows.

 

 

We
are subject to a number of risks related to credit card and debit card payments we accept.

 

We
accept payments through credit card and debit card transactions. For credit card and debit card payments, we pay interchange and
other fees, which may increase over time. An increase in those fees would require us to either increase the prices we charge for
our services which could cause us to lose clients or suffer an increase in our operating expenses, either of which could harm
our operating results. If we or any of our processing vendors have problems with our billing software, or the billing software
malfunctions, it could have an adverse effect on our customer satisfaction and could cause one or more of the major credit card
companies to disallow our continued use of their payment products. In addition, if our billing software fails to work properly
and, as a result, we do not automatically charge our clients’ credit cards, debit cards or bank accounts on a timely basis
or at all, we could lose revenues, which would harm our operating results. If we fail to adequately control fraudulent credit
card and debit card transactions, we may face civil liability, diminished public perception of our security measures and significantly
higher credit card and debit card related costs, each of which could adversely affect our business, financial condition and results
of operations. The termination of our ability to process payments on any major credit or debit card would significantly impair
our ability to operate our business.

 

Security
breaches of confidential customer information, in connection with our electronic processing of credit and debit card transactions,
or confidential employee information may adversely affect our business.

 

Our
business requires the collection, transmission and retention of large volumes of customer and employee data, including credit
and debit card numbers and other personally identifiable information, in various information technology systems that are maintained
internally and by third parties with whom we contract to provide services. The integrity and protection of that customer and employee
data is critical to us. Our customers and employees have a high expectation that we and our service providers will adequately
protect their personal information. The information, security and privacy requirements imposed by governmental regulation are
increasingly demanding. Our systems may not be able to satisfy these changing requirements and customer and employee expectations
or may require significant additional investments or time in order to do so. Efforts to hack or breach security measures, failures
of systems or software to operate as designed or intended, viruses, operator error or inadvertent releases of data all threaten
our information systems and records. A breach in the security of our service providers’ information technology systems could
lead to an interruption in the operation of our systems, resulting in operational inefficiencies and a loss of profits. A significant
theft, loss or misappropriation of, or access to, customers’ or other proprietary data or other breach of our information
technology systems could result in fines, legal claims or proceedings, including regulatory investigations and actions, or liability
for failure to comply with privacy and information security laws, which could disrupt our operations, damage our reputation and
expose us to claims from customers and employees, any of which could have a material adverse effect on our financial condition
and results of operations.

 

We
rely on third parties to provide services in connection with our business, and any failure by these third parties to perform their
obligations could have an adverse effect on our business, financial condition and results of operations.

 

We
have entered into agreements with third parties that include, but are not limited to, information technology systems (including
hosting our website, mobile application and our point of sale system), select marketing services, and employee benefits servicing.
Services provided by third-party suppliers could be interrupted as a result of many factors, such as acts of nature or contract
disputes. Accordingly, we are subject to the risks associated with the third parties’ abilities to provide these services
to meet our needs. Any failure by a third party to provide services for which we have contracted on a timely basis or within expected
service level and performance standards could result in a disruption of our business and have an adverse effect on our business,
financial condition and results of operations.

 

 

Our
amended and rested articles of incorporation provide that state or federal court located within the state of Nevada will be the
sole and exclusive forum for substantially all disputes between us and our shareholders, which could limit its stockholders’
ability to obtain a favorable judicial forum for disputes with us or our directors, officers or other employees.

 

Our
amended and restated articles of incorporation provide that “[u]nless the Corporation consents in writing to the selection
of an alternative forum, the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of the Corporation,
(ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of the Corporation
to the Corporation or the Corporation’s stockholders, (iii) an action asserting a claim arising pursuant to any provision
of the NRS, or (iv) any action asserting a claim governed by the internal affairs doctrine, shall be a state or federal court
located within the state of Nevada, in all cases subject to the court’s having personal jurisdiction over the indispensable
parties named as defendants. This exclusive forum provision is intended to apply to claims arising under Nevada state law and
would not apply to claims brought pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”),
the Securities Act, or any other claim for which the federal courts have exclusive jurisdiction. The exclusive forum provision
in our amended and restated articles of incorporation will not relieve us of our duty to comply with the federal securities laws
and the rules and regulations thereunder, and shareholders will not be deemed to have waived our compliance with these laws, rules
and regulations.

 

Public
health epidemics or outbreaks could adversely impact our business.

 

In
December 2019, a novel strain of coronavirus (COVID-19) emerged in Wuhan, Hubei Province, China. While initially the outbreak
was largely concentrated in China and caused significant disruptions to its economy, it has now spread to several other countries
and infections have been reported globally.

 

On
March 17, 2020, as a result of COVID-19 infections having been reported throughout both Canada and the United States, certain
national, provincial, state and local governmental issued proclamations and/or directives aimed at minimizing the spread of COVID-19.
Accordingly, on March 17, 2020, the Company closed all corporate clinics for all in-clinic non-essential services to protect the
health and safety of its employees, partners and patients. On March 20, 2020, the Company announced the precautionary measures
taken as well as announcing the business impact related to the coronavirus (COVID-19) pandemic.

 

Operating
under COVID-19 related governmental proclamations and directives, between March 17, 2020 and June 1, 2020, the Company provided
in-clinic multi-disciplinary primary healthcare services and products solely to patients with emergency and essential need while
also providing certain virtual based services related to physiotherapy. In light of most eldercare related services being deemed
essential by national, provincial and local governmental authorities in Canada, NHL’s contracted eldercare related services
have been nominally impacted during the fiscal third quarter and we project the same for the fiscal fourth quarter.

 

On
May 26, 2020, the Ontario Ministry of Health announced updated guidance and directives stating that physiotherapists, chiropractors
and other regulated health professionals, including all services and products provided by the Company, can gradually and carefully
begin providing all services, including non-essential services, once the clinician and provider are satisfied all necessary precautions
and protocols are in place to protect the patients, the clinician and the clinic staff. With all corporate clinics closed due
to the COVID-19 pandemic, with the exception of providing certain limited essential and emergency services, the Company had furloughed
48 full-time employees and 35 part-time employees from its pre-closure levels of 81 full-time employees and 53 part-time employees.

 

On
June 2, 2020, the Company commenced opening its corporate clinics and providing non-essential services. As of June 9, 2020, the
Company had opened all corporate clinics while following all mandated guidelines and protocols from Health Canada, the Ontario
Ministry of Health, and the respective disciplines’ regulatory Colleges to ensure a safe treatment environment for our staff
and clients. Certain of these guidelines and protocols include both active and passive screening for staff and clients, enhanced
cleaning measures using only Health Canada approved disinfectants and sanitizers, personal protective equipment usage, appropriate
signage and markers throughout the clinics, and layout changes to the clinics to reflect proper physical distancing measures.
Additional, more restrictive proclamations and/or directives may be issued in the future.

 

With
our clinic facilities re-opened and our eldercare contracts operating under COVID-19 pandemic related mandated guidelines and
protocols, for the month ended November 30, 2020, NHL’s clinic-based patient flow has met and exceeds 80% for the same period
in 2019. In addition, for the month ended November 30, 2020 NHL’s eldercare contract services provided has met and exceeds
92% for the same period in 2019. As of November 30, 2020, the Company has 73 full-time employees and 54 part-time employees.

 

 

Based
on no additional “lockdowns” or new material directives are implemented limiting the Company’s ability to provide
both its clinic and eldercare community related services, for fiscal year 2021 the Company projects a steady month-over-month
increase as (i) recommended guidelines for patient-clinician on-site interaction are eased, and (ii) more overall movement restrictions
are reduced and people are more comfortable in public spaces.

 

The
ultimate impact of the COVID-19 pandemic on the Company’s operations remains unknown and will depend on future developments,
which are highly uncertain and cannot be predicted with confidence, including the duration of the COVID-19 outbreak, new information
which may emerge concerning the severity of the COVID-19 pandemic, and any additional preventative and protective actions that
governments, or the Company, may direct, which may result in an extended period of continued business disruption, reduced patient
traffic and reduced operations. The full long-term financial impact cannot be reasonably estimated at this time but is anticipated
to have a material adverse impact on our business, financial condition, and results of operations.

 

The
measures taken to date will impact the Company’s fiscal year 2021 business and potentially beyond. Management expects that
all of its business segments, across all of its geographies, will be impacted to some degree, but the significance of the full
impact of the COVID-19 outbreak on the Company’s business and the duration for which it may have an impact cannot be determined
at this time.

 

Risks
Related to our Multidisciplinary Primary Health Care Business

 

We
may not be able to successfully implement our business growth initiatives for our multidisciplinary primary health care business
on a timely basis or at all, which could harm our business, financial condition and results of operations.

 

The
growth of our multidisciplinary primary health care business depends on our ability to open and acquire new clinics and expand
our roster of clinicians and staff to best service our multidisciplinary primary health care clinics and eldercare centric homes.

 

A
component of our growth strategy is to increase the number of our multidisciplinary primary health care clinics through both the
acquisition of existing clinics and the opening of new clinics while also engaging new contracts with new affiliate clinics and
elder centric homes. Our ability to acquire and open profitable clinics and expand our clinician and staffing requirements depends
on many factors, including our ability to:

 

   access capital to fund future acquisitions and preopening expenses;

 


   achieve brand awareness in new and existing markets;

 


   manage costs, which could give rise to delays or cost overruns;

 


   recruit, train, and retain qualified multidisciplinary primary health care clinicians and other staff in our local markets;

 


   obtain favorable reimbursement rates for services rendered at the clinics;

 


   successfully staff and operate new clinics and affiliated clinics and elder centric homes;

 


   obtain all required governmental approvals, certificates, licenses and permits on a timely basis;

 


   manage delays in the acquisition or opening of clinics;

 


   compete for appropriate sites in new markets against other multidisciplinary primary health care competitors and clinics; and

 


   maintain adequate information systems and other operational system capabilities.

 

Further,
additional federal or state legislative or regulatory restrictions or licensure requirements could negatively impact our ability
to operate both new and existing clinics.

 

 

Accordingly,
we may not be able to achieve our planned growth or, even if we are able to grow our clinic base as planned, any new clinics may
not be profitable or otherwise perform as planned. Failure to implement successfully our growth strategy would likely have an
adverse impact on our business, financial condition or results of operations.

 

The
long-term success of our multidisciplinary primary health care business is highly dependent on our ability to successfully identify
and acquire target clinics and identify and secure staffing opportunities.

 

To
achieve our business growth initiative, we will need to acquire and open new clinics and operate them on a profitable basis. We
expect this to be the case for the foreseeable future. In addition, we will need to identify and secure staffing opportunities
as well. We consider numerous factors in identifying target markets where we can enter or expand and staffing opportunities that
we can secure.

 

The
number and timing of new clinics acquired and opened during any given period may be negatively impacted by a number of factors
including, without limitation:

 

●       the
identification and availability of attractive sites for new clinics and the ability to negotiate suitable lease terms;

 

●       our
ability to successfully identify and address pertinent risks during acquisition due diligence;

 

●       the
preparation of target clinics’ financial statements on methods of accounting other than generally accepted accounting principles
in the United States (“GAAP”);

 

●       the
proximity of potential sites to one of our or our competitors’ existing clinics;

 

●       our
ability to obtain required governmental licenses, permits and authorizations on a timely basis; and

 

●       our
ability to recruit qualified clinicians and other personnel to staff our clinics.

 

If
we are unable to find and secure attractive target clinics to expand in existing markets or enter new markets, our revenues and
profitability may be harmed, we may not be able to implement our business growth initiatives and our financial results may be
negatively affected.

 

Our
intended acquisition and opening of clinics and increase in staffing in new markets exposes us to various risks and may require
us to develop new business models.

 

Our
growth and profitability depend on our ability to implement our business growth initiatives by expanding the number of clinics
we operate and the amount of staffing in both new and existing markets. We cannot assure you our efforts to expand into new markets,
particularly where we do not currently operate, will succeed. To operate in new markets, we may be required to modify our existing
business model and cost structure to comply with local regulatory or other requirements, which may expose us to new operational,
regulatory or legal risks.

 

We
may be unable to acquire target clinics within our current price ranges. This may reduce the pace of our growth and increase the
need for additional debt and equity capital. The patient population of clinics we acquire may be loyal to existing ownership,
making it difficult to maintain pre-closing revenue and profit levels. The re-branding of acquired clinics may have an adverse
market effect in local communities, and our brand may not be received as favorably in the local communities as we anticipate.

 

The
process of integration of an acquired clinic may subject us to a number of risks, including:

 

●       Failure
to successfully manage relationships with multidisciplinary primary health care clinicians and other staff of the acquired clinic;

 

●       Demands
on management related to the increase in size of our Company after the acquisition;

 

●       Diversion
of management attention;

 

 

●       Potential
difficulties integrating and harmonizing financial reporting systems;

 

●       Difficulties
in the assimilation and retention of employees;

 

●       Inability
to retain the multidisciplinary primary health care clinicians and other staff of the acquired clinic;

 

●       Inability
to establish uniform standards, controls, systems, procedures and policies;

 

●       Inability
to retain the patients of the acquired clinic;

 

●       Exposure
to legal claims for activities of the acquired clinic prior to acquisition; and

 

●       Incurrence
of additional expenses in connection with the integration process.

 

If
the acquired clinic is not successfully integrated into our Company, our business, financial condition and results of operations
could be materially adversely affected, as well as our reputation. Furthermore, if we are unable to successfully integrate the
acquired clinic or if there are delays in combining the businesses, the anticipated benefits of the acquisition may not be realized
fully or at all or may take longer to realize than expected.

 

Growing
our business through acquisitions will require additional personnel. There can be no assurance that these demands will not have
a material adverse effect on our business, financial condition, and results of operations, nor can there be any assurance that
we will be able to attract or retain competent personnel and improve our operational systems sufficiently to support the expansion
of our operations.

 

Also
important to our success will be our ability to achieve additional economies of scale in order to improve operating margins. There
can be no assurance that we will be able to achieve such economies of scale, and the failure to do so could have a material adverse
effect on our business, financial condition, and results of operations.

 

Clinics
we open in new markets may take longer to reach expected revenue and profit levels on a consistent basis. The cost of opening
and operating new clinics may exceed our budget, thereby affecting our overall profitability. New markets may have competitive
conditions, consumer preferences, and health care spending patterns that are more difficult to predict, identify or satisfy than
our existing markets. We may need to make greater investments than we originally planned in advertising and promotional activity
in new markets and after closing acquisitions to build brand awareness. We may find it more difficult in new markets to hire,
and we may not be able to retain and motivate qualified multidisciplinary primary health care clinicians and other personnel.
We may need to augment our labor model to meet regulatory requirements and the overall cost of labor may increase or be higher
than anticipated.

 

As
a result, any new or acquired clinics may be less successful and may not achieve target profit margins at the same rate or at
all. If any steps taken to expand our existing business model into new markets are unsuccessful, we may not be able to achieve
our growth objectives and our business, financial condition and results of operations could be adversely affected.

 

We
will require additional capital to fund our operating and expansion costs, and our inability to obtain such capital will likely
harm our business.

 

Although
we currently operate 16 corporate owned multidisciplinary primary health care clinics, our administrative, corporate and general
organizational infrastructure is designed to support numerous additional clinics. Consequently, we expect that our monthly expenses
will continue to exceed our monthly cash receipts until we significantly increase the number of our multidisciplinary primary
health care clinics. Depending on the results of our operations, we may need to raise additional capital to cover our operating
and expansion costs.

 

To
support our expansion strategy, we must have sufficient capital to continue making investments in new and existing clinics. Current
funding sources and cash generated by our operations may not be sufficient to allow us to sustain our expansion efforts. If this
is the case, we may need additional equity or debt financing to provide the funds required to operate and expand our business.
If such financing is not available on satisfactory terms or at all, we may be unable to expand our business or acquire new clinics
at our projected rate and our operating results may suffer. Debt financing increases expenses and must be repaid regardless of
operating results and may impose restrictions on the manner in which we operate our business. Equity financing, or debt financing
that is convertible into equity, could result in additional dilution to our existing stockholders. Furthermore, if we are unable
to obtain adequate capital, whether in the form of equity or debt, to fund our business and growth strategies we may be required
to delay, scale back or eliminate some or all of our expansion plans, which may have a material adverse effect on our business,
operating results, financial condition, or prospects.

 

 

The
clinics that we intend to acquire or open may not meet our expectations.

 

In
general, our business growth initiatives involve the acquisition and opening of strategically located clinics. Clinics that we
intend to acquire and open may not meet our revenue or profit targets or may take longer than anticipated to do so. If our acquired
or new clinics do not perform as planned, our business and future prospects could be harmed. If we are unable to manage successfully
the potential difficulties associated with acquiring and opening new clinics, we may not be able to capture the efficiencies and
opportunities that we expect from our expansion strategy. Our inability to capture expected efficiencies of scale, maintain patient
volumes, improve our systems and equipment, continue our cost discipline, and retain appropriate physician and overall labor levels,
could have a material adverse effect on our business, financial condition and results of operations.

 

If
we open new clinics in existing markets, revenue at our existing clinics may be affected negatively.

 

The
catchment area of our clinics varies by location and depends on a number of factors, including population density, other available
convenient medical or multidimensional primary health care services, area demographics and geography. As a result, the opening
of a new clinic in or near markets in which we already have clinics could adversely affect the revenues of those existing clinics.
Existing clinics could also make it more difficult to build our patient base for a new clinic in the same market. We may selectively
open new clinics in and around areas of existing clinics that are operating at or near capacity to serve effectively our patients,
but revenue cannibalization between our clinics may become significant in the future as competition increases and as we continue
to expand our operations. This could adversely affect our revenue growth, which could, in turn, adversely affect our business,
financial condition, or results of operations.

 

We
may be required to make capital expenditures in connection with our acquisitions to implement our growth strategy.

 

In
order to maintain brand consistency across our multidimensional primary health care clinics, we may need to make significant capital
expenditures to the interior and exterior of our clinics. This may include making real property improvements and upgrading our
medical equipment to serve our patients and remain competitive. Changing competitive conditions or the emergence of significant
advances in medical technology could require us to invest significant capital in additional equipment or capacity in order to
remain competitive. Along these lines, if the systems and technology of our target clinics differ from those we have chosen to
utilize, we may be required to invest significant capital to either convert, terminate, or integrate the varying medical technology
platforms. If we are unable to fund any such investment or otherwise fail to make necessary capital expenditures, our business,
financial condition, or results of operations could be materially and adversely affected.

 

Damage
to our reputation or our brand in existing or new markets could negatively impact our business, financial condition and results
of operations.

 

We
must grow the value of our brand to be successful. We intend to further develop our reputation and brand of providing patients
with high quality effective multidisciplinary primary health care services, and related products, delivered by respected clinicians
and well-trained operational staff. Additionally, we place high-value on building and maintaining a patient-centered culture.
If we do not make investments in areas such as marketing and advertising, as well as the day-to-day investments required for clinic
operations, equipment upgrades, and personnel training, the value of our brand may not increase or may be diminished. Any incident,
real or perceived, regardless of merit or outcome, that adversely affects our brand, such as, but not limited to, patient disability
or death due to malpractice or allegations of malpractice, failure to comply with federal, provincial or local regulations, including
allegations or perceptions of non-compliance or failure to comply with ethical and operational standards, could significantly
reduce the value of our brand, expose us to negative publicity and damage our overall business and reputation.

 

 

Our
marketing activities may not be successful.

 

We
incur costs and expend other resources in our marketing efforts to attract and retain patients. Our marketing activities are principally
focused on increasing brand awareness in the communities in which we provide services. As we open and acquire new clinics, we
expect to undertake aggressive marketing campaigns to increase community awareness about our presence and our service capabilities.
We plan to conduct our targeted marketing efforts in neighborhoods through channels such as direct mail, billboards, radio advertisements,
physician open houses, community sponsorships and various social media. If we are not successful in these efforts, we will have
incurred expenses without materially increasing revenue.

 

The
multidisciplinary primary health care market is highly competitive, including competition for patients, strategic relationships,
and commercial payor contracts, each of which could adversely affect our contract and revenue base.

 

The
market for providing multidisciplinary primary health care services, and related products, is highly competitive, and all of our
clinics and staffing opportunities face and will face competition, in varying degrees, from existing multidisciplinary primary
health care providers. walk-in clinics, hospital emergency rooms, private doctors’ offices, freestanding emergency clinics,
independent laboratories, hospital- and payor-supported urgent care facilities, and occupational medicine clinics. We compete
with national, regional, and local enterprises, some of which have greater financial and other resources available to them, greater
access to clinicians, medically licensed physicians and other medical professionals or greater access to potential patients. Our
clinics and staffing compete on the basis of accessibility, including evening and weekend hours, walk-in care, as well as varying
appointment opportunities. We also compete on the basis of our multi-provinces, regional footprint, which we believe will be of
value to both employers and third-party payors. As a result of the differing competitive factors within the markets in which we
operate and will operate, the individual results of our clinics may be volatile. If we are unable to compete effectively with
any of these entities or groups, we may be unable to implement our business strategies successfully, which could have a material
adverse effect on our business, prospects, results of operations and financial condition.

 

We
may not be able to recruit and retain qualified multidisciplinary primary health care clinicians for our multidisciplinary primary
health care clinics and staffing of affiliate clinics and eldercare centric homes.

 

Our
success depends upon our ability to recruit and retain qualified multidisciplinary primary health care clinicians and other staff.
There is currently a national shortage in Canada and United States of certain of these health care professionals. To the extent
a significant number of multidisciplinary primary health care clinicians within an individual community or market decide to partner
with competing multidisciplinary primary health care providers or hospitals and not with us, we may not be able to operate our
clinics in such community. We face competition for such personnel from existing operators, hospital systems, entrepreneurial start-ups,
and other organizations. This competition may require us to enhance wages and benefits to recruit and retain qualified personnel.
Our inability to recruit and retain these professionals could have a material adverse effect on our ability to grow or be profitable.

 

We
may not be able to prohibit or limit our multidisciplinary primary health care clinicians from competing with us in our local
markets.

 

In
certain provinces in Canada in which we operate or intend to operate and states in the United States in which we intend to operate,
non-compete, non-solicitation, and other negative covenants applicable to employment or ownership are judicially or statutorily
limited in their effectiveness or are entirely unenforceable against multidisciplinary primary health care professionals. As a
result, we may not be able to protect our operational processes, procedures, and general trade secrets or limit insiders from
using competitive information against us or competing with us, which could have a material adverse effect on our ability to remain
competitive.

 

 

With
respect to our operations in Canada, we may be unable to enter into or maintain contracts for our affiliate multidisciplinary
primary health care clinics and eldercare focused facilities or services on favorable terms with commercial payors.

 

In
Canada, a significant portion of our net patient service revenue is derived from nongovernmental, extended health insurers which
provide reimbursement based on a pre-allocated amount disbursed as a cash payment for services, and related products, provided
to the patient.

 

With
respect to our anticipated expansion of our operations into the United States, we may be unable to enter into or maintain contracts
for our multidisciplinary primary health care clinics and services on favorable terms with commercial payors in the United States.

 

With
respect to our anticipated expansion of our operations into the United States, we anticipate that a significant portion of our
net patient service revenue will be derived from nongovernmental, third-party payors, or commercial payors, such as managed care
organizations, commercial insurance providers and employer-sponsored health care plans. These commercial payors use a variety
of methods for reimbursement depending on the arrangement involved. These arrangements include fee-for-service, PPOs and health
maintenance organizations, as well as prepaid and discounted medical service packages and capitated, or fixed fee, contracts.
Rates for health maintenance organization benefit plans are typically lower than those for PPOs or other benefit plans that offer
broader provider access.

 

Frequently,
commercial payors classify or may reclassify our multidisciplinary primary health care services differently. Such distinctions
may result in different payment and reimbursement structure. Such differences may affect costs to the patient through increased
copayments, deductibles and other cost-sharing mechanisms and, accordingly, patient choice of provider.

 

There
is often pressure to renegotiate reimbursement levels, particularly in connection with changes to Medicare. Typically, commercial
payors reimburse us based upon contracted discounts to our established base rates. If managed care organizations and other commercial
payors reduce their rates or we were to experience a significant shift in our revenue mix toward Medicare or Medicaid reimbursements,
then our revenue and profitability would be adversely affected and our operating margins would be reduced. Commercial payors often
demand discounted fee structures, and the trend toward consolidation among commercial payors tends to increase their bargaining
power over fee structures. Because some commercial payors rely on all or portions of Medicare fee schedules to determine payment
rates, changes to government health care programs that reduce payments under these schedules may negatively impact payments from
commercial payors. Other health care providers may impact our ability to negotiate increases and other favorable terms in our
reimbursement arrangements with commercial payors. For example, some of our competitors may negotiate exclusivity provisions with
commercial payors or otherwise restrict the ability of commercial payors to contract with us. We may be excluded from participating
in commercial payor networks, making it more expensive for certain patients to receive treatment at our clinics. Our results of
operations will depend, in part, on our ability to retain and renew managed care contracts as well as enter into new managed care
contracts on terms favorable to us. Our inability to maintain suitable financial arrangements with commercial payors could have
a material adverse impact on our business.

 

As
various provisions of the ACA are implemented, commercial payors may increasingly demand fee reductions. In addition, there is
a growing trend for commercial payors to take steps to shift the primary cost of care to the plan participant by increasing co-payments,
co-insurance and deductibles, and these actions could discourage such patients from seeking treatment at our clinics. Patient
volumes could be negatively impacted if we are unable to enter into or maintain acceptable contracts with such commercial payors,
which could have a material adverse effect on our business, prospects, results of operations and financial condition.

 

Government
health care programs may reduce reimbursement rates.

 

Our
competition will also be the Canadian health care system which is a government sponsored system that began in 1957, when Parliament
approved the Hospital Insurance and Diagnostics Services Act. The Act provided free acute hospital care, laboratory and radiological
diagnostic services to Canadians. By 1961, agreements were in place with all the provinces and 99% of Canadians had free access
to the health care services covered by the legislation. The Act was followed by the Medical Care Act of 1966 that provided free
access to physician services. By 1972, each province had established its own system of free access to physician services. The
federal government shared in the funding. In 1984, the Government of Canada passed the Canada Health Act (CHA). The Canada Health
Act created a publicly administered health care system that is comprehensive, universal and accessible. All medically necessary
procedures are provided free of charge. The system provides diagnostic, treatment and preventive services regardless of income
level or station in life. Access to care is not based on health status or ability to pay. Coverage is portable between provinces
and territories. We can give no assurance that we will be able to effectively compete in this market.

 

 

In
recent years, in the United States, new legislation has been proposed and adopted at both the federal and state level that is
effecting major changes in the health care system. Any change in the laws, regulations, or policies governing the health care
system could adversely affect reimbursement rates and our operations and financial condition. Enacted in March 2010, the ACA seeks
to expand health care coverage, while increasing quality and limiting costs. The ACA substantially changes the way health care
is financed by both governmental and commercial payors. As a result of the ACA or the adoption of additional federal and state
health care reforms measures there could be limits to the amounts that federal and state governments will pay for health care
services, which could result in reduced demand or profitability of our services.

 

Furthermore,
if due to an allegation of fraud or any other reason one or more of our multidisciplinary primary health care clinicians or practitioners
is no longer entitled to bill and receive payment for services rendered to patients whose treatment is paid in whole or in part
by a governmental payor, our revenue may be negatively impacted, which could have a material adverse effect on our business, prospects,
results of operations and financial condition.

 

If
payments from commercial or governmental payors are significantly delayed, are reduced or eliminated, our business, prospects,
results of operations and financial condition could be adversely affected.

 

We
depend upon compensation from third-party payors for the services provided to patients by our multidisciplinary primary health
care clinicians and practitioners in our clinics, affiliate clinics and eldercare centric homes serviced by our clinicians. The
amount that we receive through our clinics in payment for their services may be adversely affected by factors we do not control,
including federal, provincial or local regulatory changes, cost-containment decisions and changes in reimbursement schedules of
third-party payors and legislative changes. Any reduction or elimination of these payments could have a material adverse effect
on our business, prospects, results of operations and financial condition.

 

Additionally,
the reimbursement process is complex and can involve lengthy delays. Although we recognize revenue when multidisciplinary primary
health care services are provided, there can be delays before we receive payment. In addition, third-party payors may disallow,
in whole or in part, requests for reimbursement based on determinations that certain amounts are not reimbursable under plan coverage,
that services provided were not medically necessary, or that additional supporting documentation is necessary. Retroactive adjustments
by third-party payors may be difficult or cost prohibitive to appeal, and such changes could materially reduce the actual amount
we receive from those payors. Delays and uncertainties in the reimbursement process may be out of our control and may adversely
affect us.

 

Significant
changes in our payor mix resulting from fluctuations in the types of patients seen at our clinics could have a material adverse
effect on our business, prospects, results of operations and financial condition.

 

Our
results may change from period to period due to fluctuations in payor mix or other factors relating to the type of treatment performed
by clinicians at our clinics. Payor mix refers to the relative amounts we receive from the mix of persons or entities that pay
or reimburse us for health care services. Because we generally receive relatively higher payment rates from commercial payors
than from governmental payors or self-pay patients, a significant shift in our payor mix toward a higher percentage of self-pay
or patients whose treatment is paid in whole or part by a governmental payor, which could occur for reasons beyond our control,
could have a material adverse effect on our business, prospects, results of operations and financial condition.

 

Failure
to bill timely or accurately for our services could have a negative impact on our net revenues, bad debt expense and cash flow.

 

Billing
for our services is often complex and time consuming. The practice of providing multidisciplinary primary health care services,
and related products, in advance of payment or prior to assessing a patient’s ability to pay for such services may have
a significant negative impact on our patient service revenue, bad debt expense and cash flow. We bill numerous and varied payors,
including self-pay patients, various forms of commercial payors, government payors and insurance payors. Billing requirements
that must be met prior to receiving payment for services rendered often vary by payor. Self-pay patients and third-party payors
may fail to pay for services even if they have been properly billed. Reimbursement is typically dependent on our providing the
proper procedure and diagnosis codes.

 

 

Additional
factors that could affect our collections for the services we render include:

 

●       disputes
among payors as to which party is responsible for payment;

 

●       variations
in coverage among various payors for similar services;

 

●       the
difficulty of adherence to specific compliance requirements, coding and various other procedures mandated by responsible parties;

 

●       the
institution of new coding standards; and

 

●       failure
to properly credential our providers to enable them to bill various payors.

 

The
complexity associated with billing for our services causes many delays in our cash collections, resulting in increased carrying
costs associated with the aging of our accounts receivable as well as the increased potential for bad debt expense.

 

We
are dependent on our third-party revenue cycle managers for billing and collection of our claims.

 

We
submit our claims for services rendered to commercial payors and governmental payors electronically through our third-party revenue
cycle managers. We are dependent on our revenue cycle managers for the timely billing and collections of our claims. Any delay
by or failure of our revenue cycle managers to timely bill and collect our claims could have a material adverse effect on our
business, results of operations and financial condition.

 

We
may incur costs resulting from security risks in connection with the electronic data processing by our partner banks.

 

Because
we accept electronic payment cards for payments at our facilities, we may incur costs resulting from related security risks in
connection with the electronic processing of confidential information by our partner banks. Recently, several of the large national
banks have experienced potential or actual breaches in which similar data has been or may have been stolen. Such occurrences could
cause patient dissatisfaction resulting in decreased visits or could also distract our management team from the management of
the day-to-day operations.

 

With
respect to our Canadian operations and our anticipated expansion of our operations into the United States, a successful challenge
by tax authorities to our treatment of certain multidisciplinary primary health care clinicians and practitioners as independent
contractors or the elimination of an existing safe harbor could materially increase our costs relating to these multidimensional
primary health care clinicians and practitioners.

 

With
respect to our Canadian operations and our anticipated expansion of our operations into the United States, certain of our multidisciplinary
primary health care clinicians and practitioners may be engaged as independent contractors by our state-level operating subsidiaries.
If these personnel are treated as independent contractors rather than as employees, our state-level operating subsidiaries will
not (i) withhold federal, state or local or state income or other employment related taxes from their compensation, (ii) make
federal, provincial, state or local federal or state unemployment tax or Federal Insurance Contributions Act payments with respect
to them, (iii) provide workers compensation insurance with respect to them (except in states where they are required to do so
for independent contractors), or (iv) allow them to participate in benefits and retirement programs available to employees. Although
we will have contracts with these licensed multidisciplinary primary health care clinicians obligating them to pay these taxes
and other costs, if a challenge to our treatment of these licensed multidisciplinary primary health care clinicians and practitioners
as independent contractors by federal, state or local authorities were successful and they were treated as employees instead of
independent contractors, we could be liable for taxes, penalties and interest. In addition, there are currently, and have been
in the past, proposals made to eliminate an existing safe harbor that would potentially protect us from the imposition of taxes
in these circumstances, and similar proposals could be made in the future. If such a challenge were successful or if the safe
harbor were eliminated, this could cause a material increase in our costs relating to these personnel and, have a material adverse
effect on our business, financial condition and results of operations.

 

 

Currently,
our corporate owned clinics and affiliate clinics are located in the Canadian provinces of Ontario, Alberta, Nova Scotia and Newfoundland
making us particularly sensitive to regulatory, economic, and other conditions in those states.

 

Our
clinics and affiliate clinics are located in the Canadian provinces of Ontario, Alberta, Nova Scotia and Newfoundland. If there
were an adverse regulatory, economic or other development in any of those states, our patient volume could decline, our ability
to operate our clinics under our existing business model could be impacted, or there could be other unanticipated adverse impacts
on our business that could have a material adverse effect on our business, prospects, results of operations and financial condition.

 

Our
business is seasonal, which impacts our results of operations.

 

Our
clinics’ patient and staffing volumes are sensitive to seasonal fluctuations. Typically, winter months see a higher occurrence
of motor vehicle and winter weather related accidents, such as falling, however; the timing and severity of these can vary dramatically.
Additionally, in the United States as consumers shift toward high deductible insurance plans, they are responsible for a greater
percentage of their bill, particularly in the early months of the year before other health care spending has occurred, which may
lead to lower than expected patient volume or an increase in bad debt expense during that period. Our quarterly operating results
may fluctuate significantly in the future depending on these and other factors.

 

We
could be subject to lawsuits for which we are not fully insured.

 

Medical
professionals, including multidisciplinary primary health care clinicians and practitioners, have become subject to an increasing
number of lawsuits alleging medical malpractice and related legal theories such as negligent hiring, supervision and credentialing.
In Canada, our clinicians and practitioners, whether an employee or independent contractor, are responsible for their own professional
liability insurance coverage. As provided in Canadian rules and regulations, our liability insurance coverage is not required
to cover our clinicians and practitioners. As we expand in the United States, we anticipate procuring insurance coverage for our
affiliated multidimensional primary health care clinicians, practitioners and corporate entities. In addition, as we expand our
menu of services and related products through our various Medical Technology Platforms or possible acquisition of a medical licensed
primary care practice, we will be subject to lawsuits alleging medical malpractice and related legal theories such as negligent
hiring, supervision and credentialing.

 

We
are currently insured under policies in amounts management deems appropriate, based upon the nature and risk of our business.
Nevertheless, there are exclusions and exceptions to coverage under each insurance policy that may make coverage for any claim
unavailable, future claims could exceed the limits of available insurance coverage, existing insurers could become insolvent and
fail to meet their obligations to provide coverage for such claims, and such coverage may not always be available with sufficient
limits and at reasonable cost to insure us adequately and economically in the future. One or more successful claims against us
not covered by, or exceeding the coverage of, our insurance could have a material adverse effect on our business, prospects, results
of operations and financial condition. Moreover, in the normal course of our business, we may be involved in other types of lawsuits,
claims, audits and investigations, including those arising out of our billing and marketing practices, employment disputes, contractual
claims and other business disputes for which we may have no insurance coverage. The outcome of these matters could have a material
adverse effect on our financial position, results of operations, and cash flows.

 

Some
of these lawsuits involve large claim amounts and substantial defense costs.

 

Insurance
coverage for some of our losses may be inadequate and may be subject to the credit risk of commercial insurance providers.

 

We
maintain insurance coverage for specific liability for our clinic facilities through various third-party insurers. To the extent
we hold policies to cover certain groups of claims or rely on insurance coverage obtained by third parties to cover such claims,
we may be responsible for those losses if the insurance coverage is inadequate or the insurer rejects our claim for payment. Furthermore,
for our losses that are insured or reinsured through commercial insurance providers, we are subject to the financial viability
of those insurance companies. Although we believe our commercial insurance providers are currently creditworthy, they may not
remain so in the future.

 

 

Risks
Related to Health Care Regulation

 

The
health care industry is heavily regulated, and if we fail to comply with these laws and government regulations, we could incur
penalties or be required to make significant changes to our operations.

 

The
health care industry is heavily regulated and closely scrutinized by federal, state, provincial and local governments. Comprehensive
statutes and regulations govern the manner in which we provide and bill for services and products, our contractual relationships
with our clinicians, vendors, patients and our marketing activities and other aspects of our operations. If we fail to comply
with these laws and regulations, we could be exposed to civil and criminal penalties such as fines, damages, overpayment recoupment,
loss of enrollment status and exclusion from government health care programs. Any action against us for violation of these laws
or regulations, even if successfully defended, could cause us to incur significant legal expenses and divert our management’s
attention from the operation of our business. Our clinicians and practitioners are also subject to ethical guidelines and operating
standards of professional and private accreditation agencies.

 

The
laws, regulations and standards governing the provision of health care service, and related products, may change significantly
in the future, and these changes may materially and adversely affect our business. Furthermore, a review of our business by regulatory
or accreditation authorities could result in determinations that could adversely affect our operations.

 

Our
Canadian clinics are and will be subject to numerous statutes and regulations. Additionally, given our intention to expand and
begin operations in the United States, we will be subject to numerous U.S. statutes and regulations. Failure to comply with these
laws and regulations could result in civil or criminal sanctions.

 

The
operation of our clinics in Canada subjects us, and will subject us, to many provincial laws and regulations, following the projected
expansion of our Company’s operations to the United States, federal and state laws in the United States. In general, whether
directly or through boards, agencies or other delegated authorities, regulating the ownership and dispensing of controlled substances,
the retention and storage of medical records, patient privacy and protection of health information, the licensure of multidisciplinary
primary health care providers, including clinicians, and the clinical supervision, by physicians, of nurse practitioners and physician
assistants, among other aspects of our operations are regulated. All such laws and regulations, and the applicable interpretations
of such laws and regulations, are subject to change.

 

Additional
regulation of clinics such as ours has been proposed in several Canadian provinces and the United States. The adoption of any
such regulations in the provinces in Canada, or states in the United States in which we operate or intend to operate, could force
us to change our operational or transactional approach or lead to a finding by regulators that our primary care clinics and clinics
do not meet legal requirements. We may be subject to criminal prosecution, regulatory fines, penalties or other sanctions if our
operations or clinics are found to not comply with applicable laws and regulations. In addition, we may be required to refund
all funds received from patients and third-party payors during the period of noncompliance.

 

With
respect to our anticipated expansion of our operations into the United States, state regulation of the expansion of multidisciplinary
primary health care clinics could prevent us from reaching our expansion objectives.

 

In
the United States, many states have certificate of need programs that require some level of prior approval for the development,
acquisition or expansion of health care sector related facilities. With respect to our anticipated expansion of our operations
into the United States, in the event we choose to acquire or open clinics in a state that does require such approval, we may be
required to obtain a certificate of need before the acquisition or opening occurs. If we are unable to obtain such approvals,
we may not be able to move forward with the planned activity.

 

Only
a few states currently require the licensure of multidisciplinary primary health care clinics such as ours. The lack of a specific
licensure process for our clinics in the vast majority of states may lead state legislators or regulators to regulate aggressively
the growth of our industry, potentially seeking to treat our industry in a manner similar to hospitals or freestanding emergency
departments. Further, the growing number of urgent care clinics and freestanding emergency departments may lead to legislation
or regulations requiring us to change substantially our operations or cease our operations in that state entirely. Any such requirements
could have a material adverse effect on our prospects and growth strategy.

 

 

Our
services, and related products, are subject to comprehensive laws and regulations that govern the manner in which we bill and
are paid for our services by third-party payors, and the failure to comply with these requirements can result in civil or criminal
sanctions, including exclusion from federal and state health care programs.

 

A
substantial portion of our services, and related products, are paid for by commercial payors and governmental payors. These third-party
payors typically have differing and complex billing and documentation requirements. If we fail to meet these requirements, we
may not be paid for our services or payment may be substantially delayed or reduced.

 

Numerous
federal, provincial and local laws also apply to our claims for payment, including but not limited to (i) “coordination
of benefits” rules that dictate which payor must be billed first when a patient has coverage from multiple payors, (ii)
requirements that overpayments be refunded within a specified period of time, (iii) “reassignment” rules governing
the ability to bill and collect professional fees on behalf of other providers, (iv) requirements that electronic claims for payment
be submitted using certain standardized transaction codes and formats, and (v) laws requiring all health and financial information
of patients in a manner that complies with applicable security and privacy standards.

 

Third-party
payors carefully monitor compliance with these and other applicable rules. Our failure to comply with these rules could result
in our obligation to refund amounts previously paid for such services or non-payment for our services.

 

If
we are found to have violated any of these or any of the other laws or regulations which govern our activities, the resulting
penalties, damages, fines or other sanctions could adversely affect our ability to operate our business and our financial results.

 

Changes
in coverage and the rates or methods of third-party reimbursements may adversely affect our revenue and operations.

 

A
substantial portion of our revenue is derived from direct billings to patients and third-party payors. As a result, any changes
in the rates or methods of reimbursement for the services and products we provide could have a material adverse effect on our
revenue and financial results. Reimbursement rates can vary depending on whether our clinic is an in-network or out-of-network
provider. Each of our clinics may be out-of-network for some patients. When acting as an out-of-network provider, reimbursement
rates may be lower, co-payments and deductibles may be higher and we may have difficulties complying with the billing requirements
of certain third-party payors.

 

Past
and future legislation related to the health care industry and other changes in the health care industry could adversely affect
our business, financial condition and results of operations.

 

The
health care industry is subject to legislative and regulatory changes, as well as changes from other influences. The government
may continue reviewing and assessing health care delivery and payment systems and may in the future adopt legislation making additional
fundamental changes in the health care system. There is no assurance that such changes will not have a material adverse effect
on our business, financial condition or results of operations. Continued efforts to shift health care costs to the patient (through
co-payments, deductibles, and other mechanisms) could adversely affect our business, financial condition and results of operations.

 

We
are subject to the Canada Health Act, Canada’s National Health Insurance Program and Food and Drugs Act and analogous provisions
of applicable state laws and could face substantial penalties if we fail to comply with such laws.

 

In
Canada, some health care services are public, some are private with a number of different entities involved in regulating and
providing their delivery. While there is a perception that all health care in Canada is publicly funded, the publicly funded system
is generally restricted to “medically necessary” hospital and physician services, and provincial or territorial drug
plans that provide access to prescription drugs to residents over the age of 65 or those residents who rely on social assistance
programs. Publicly funded services are delivered through a combination of public and private providers and funding comes from
the Canadian federal government, which sets national standards, and the provincial and territorial governments, which regulates
the delivery of services and determines those services that are deemed “medically necessary” (i.e., publicly funded)
within the context of their own unique fiscal and political environment. In addition, there are a wide array of health products
and services that are not subject to coverage under the public health insurance plans that are provided on a private payer basis.

 

 

Federal/Provincial
Government Division of Power in Canada

 

As
is the case for many important industries and economic sectors, neither the federal, nor the provincial/territorial level of government
has exclusive jurisdiction over health. Instead, the Constitution Act, 1867, divides the legislative powers relevant to the regulation
of the delivery of health products and services between the federal and provincial levels of government.

 

The
federal government is responsible for regulating important aspects of various health industries or sectors including the regulation
of selling, importing, distributing and marketing drugs and medical devices and it maintains significant influence over health
policy and national objectives through the use of its spending power.

 

The
provincial/territorial level of government has comprehensive authority over the delivery of health care services. Other examples
of provincial responsibility include the regulation of hospitals and other health facilities, administration of health insurance
plans, distribution of prescription drugs and regulation of health professionals.

 

However,
many health industry sectors are subject to at least some degree of regulation or oversight by both levels of government.

 

Canada’s
National Health Insurance Program

 

Canada’s
“national” health insurance program, a publicly funded single-payer system often referred to as “Medicare,”
is designed to ensure that all Canadian residents have universal access to medically necessary hospital and physician services
through the provincial and territorial health care insurance plans.

 

The
Canada Health Act

 

The
Canada Health Act is the federal legislation that provides the foundation for the Canadian health care system. The Act is administered
by Health Canada, the federal department with primary responsibility for maintaining and improving the health of Canadians. However,
neither the Canada Health Act nor Health Canada have direct authority to regulate the health insurance plans that give effect
to the publicly funded health insurance system that is in place across the country. Instead, the Act establishes certain values
and principles and sets out criteria and conditions that each publicly funded health insurance plan is required to meet in order
to qualify for federal funding through the Canada Health Transfer. As federal funding is critical to the ability to fund “medically
necessary” hospital and physician services, each provincial and territorial health insurance plan must satisfy the requirements
of public administration; universality; portability; comprehensiveness; and accessibility.

 

Notably,
these requirements relate only to funding and administration and establishing broad principles rather than a prescriptive code.
In addition, the Canada Health Act is silent with respect to the delivery of health services and does not prohibit or discourage
the delivery of insured health services by the private sector. As a result, there is significant variation in the funding and
administration of health insurance plans from one jurisdiction to another. However, most provinces permit the delivery of a broad
range of publicly funded health services through a combination of both public and private providers. Indeed, many publicly funded
services in Canada are privately delivered.

 

The
requirement that publicly funded health insurance plans be comprehensive requires that “medically necessary” hospital
and physician services be covered. If a service is determined to be “medically necessary” then the full cost of the
service must be covered by the public plan. However, the term is not defined and the services that must be covered are intentionally
and broadly defined in order to accommodate the ability of each province and territory to make its own coverage decisions within
the context of its unique fiscal and political environment. Typically, such decisions are made in consultation with the relevant
medical associations in the jurisdiction. However, determining whether a particular service is “medical necessary”
is a determination that has both a fiscal and political dimension. Ultimately, these coverage decisions are decisions about the
allocation of scarce public resources.

 

 

The
products and services available to Canadians through the publicly funded health insurance system are supplemented by a wide array
of health products and services that are not, as a general matter, subject to coverage under the public health insurance plans.
For example, prescription drug coverage, dental services and vision care are generally provided on a private payer basis. However,
many jurisdictions provide coverage for these types of services to seniors and those who face financial or other barriers to privately
funded health care. There are also a growing number of providers that offer ancillary healthcare services. Examples include elective
surgical or cosmetic procedures.

 

Regulation
of Health Professionals and Health Facilities

 

Health
professionals and health care facilities are subject to federal laws of general application, but the regulation of such matters
is largely a matter of provincial jurisdiction.

 

Health
Professionals

 

Through
legislation, the provinces have delegated the regulation of health professionals to self-governing professional bodies (with varying
degrees of discretion). Such legislation generally seeks to protect the public through a combination of “input regulations”
that focus on who is entitled to provide a particular health service and “output regulations” that focus on the quality
and delivery of the service being provided. Such regulations also generally include conflict of interest (or anti-kickback) provisions,
as such matters are generally dealt with as part of the regulation of health professions rather than the regulation of health
facilities.

 

Health
industry participants that offer a particular service need to understand how the service is regulated. If the service involves
the performance of a regulated or controlled act (i.e., acts that can only be performed by a particular category or categories
of regulated health professionals or their delegates) then the involvement of one or more duly qualified health professionals
will likely be required. Also, it may be necessary to implement certain protocols and procedures in order to comply with the requirements
of the regulatory colleges that govern the practices of any such professionals. Complying with such requirements can have significant
commercial implications.

 

Health
Facilities

 

Operating
a regulated health facility can be challenging and often involves a degree of regulatory risk.

 

Residential
health care facilities other than hospitals, such as nursing homes, long-term care facilities, pharmacies, laboratories and specimen
collection clinics are, in most jurisdictions, privately owned and operated pursuant to provincial licenses and oversight. However,
the degree to which such health facilities and other providers are regulated generally depends on the nature of the products and
services being provided.

 

The
operation of health facilities by private sector entities still typically involves some element of reimbursement through public
funds. Where public funds are being used to acquire goods and services, additional accountability measures such as procurement
requirements often apply.

 

Regulation
of Drugs

 

The
process of obtaining marketing authorizations and approvals of prescription drugs is administered by Health Canada’s Therapeutic
Products Directorate (TPD).

 

The
TPD applies the Food and Drugs Act and the regulations applicable to prescription drugs to ensure that drug products sold in Canada
are safe and effective. No drug product can be offered for sale in Canada unless and until, after review, it is issued a marketing
authorization by Health Canada.

 

In
addition to its review of drug products, Health Canada is responsible for the ongoing monitoring of drug products being sold in
Canada, as well as the regulation of good manufacturing practices and establishment licenses, which are required in connection
with the import, manufacture, distribution and/or sale of drug products.

 

 

The
Patented Medicines Prices Review Board

 

The
Patented Medicines Prices Review Board (PMPRB) is an independent quasi-judicial body created in 1987 under amendments to the Patent
Act. The PMPRB is responsible for regulating the prices that patentees charge for prescription and non-prescription patented drugs
sold in Canada. Based on a review of the information required to be filed by a patentee, the PMPRB considers whether the price
of a medicine appears excessive based on certain factors including: (i) the prices that the patented medicine is sold in the Canadian
market; (ii) the prices at which other medicines in the same therapeutic class are sold in the Canadian market; and (iii) the
prices at which the medicine and other medicines in the same therapeutic class have been sold in other countries other than Canada.
If the PMPRB considers the price of a medicine appears excessive, revised pricing is the usual outcome.

 

Public
Market Access

 

Each
province has a provincial drug plan that allows certain individuals to access drugs at a reduced cost. Products that will be paid
for by the provincial government (in some provinces, for all residents, while in others for certain prescribed individuals such
as seniors and individuals receiving social assistance), are typically listed on provincial formularies. For innovator products,
the manufacturer negotiates the pricing for inclusion on the provincial formulary with the provincial government. For generic
products, the price to be paid for the generic product is determined by a sliding scale of fixed prices related to when such products
enter the market and the price of the innovator product (i.e., a percent of the price of the innovator pharmaceutical product
depending on whether they are first, second or third entry products). If a drug is a generic product and listed as interchangeable
on the provincial formulary, a pharmacist is permitted to dispense the interchangeable product for the innovator product. Under
most provincial benefit plans, interchanging a generic product for the innovator product by pharmacists is mandatory and generally
most provinces will only reimburse the pharmacist for the lowest cost interchangeable product. Government drug plans account for
approximately 50% of all sales of prescription drugs in Canada.

 

The
scope and enforcement of each of these laws is uncertain and subject to constant change. Federal and provincial enforcement entities
have significantly increased their scrutiny of health care companies and providers which has led to investigations, prosecutions,
convictions and large settlements. Although we conduct our business in compliance with all applicable federal and provincial fraud
and abuse laws, many of these laws are broadly worded and may be interpreted or applied in ways that cannot be predicted with
any certainty. Therefore, we cannot assure you that our arrangements or business practices will not be subject to government scrutiny
or will be found to be in compliance with applicable fraud and abuse laws. Further, responding to investigations can be time consuming
and result in significant legal fees and can potentially divert management’s attention from the Company.

 

We
are subject to the data privacy and security laws of Canada, and the failure to comply with these rules, or allegations that we
have failed to do so, could result in civil or criminal sanctions.

 

In
Canada, under the Personal Information Protection and Electronic Documents Act and under various provincial laws, comprehensive
privacy laws have been introduced to protect the privacy of individuals from the undisclosed or non-consensual sharing of sensitive
information for commercial purposes. As the gathering and use of information is such an integral component of our business, we
must always be alert for and respond to changes in the information regulatory environment. The failure to comply with these rules,
or allegations that we have failed to do so, could result in civil or criminal sanctions against us.

 

Following
the intended acquisition, or opening, of one or more clinics or staffing primary healthcare practitioners in the United States,
our centers may participate in the federal Medicare program and, as a result, we will need to comply with a number of additional
federal regulatory requirements.

 

Following
the intended acquisition, or opening, of one or more multidisciplinary primary healthcare clinics or the staffing of multidisciplinary
primary healthcare clinics, affiliate clinics or eldercare centric homes with clinicians and practitioners in the United States,
our clinics and multidisciplinary primary healthcare clinicians and practitioners, including any staffing we might pursue in affiliate
clinics or eldercare centric homes in the United States, might participate in the federal Medicare and/or Medicaid programs.

 

 

Since
1992, Medicare has paid for the “medically necessary” services of physicians, non-physician practitioners, clinicians
and certain other suppliers under a physician fee schedule, a system that pays for covered physicians’ services furnished
to a person with Medicare Part B coverage. Under the physician fee schedule, relative values are assigned to each of more than
7,000 services to reflect the amount of work, the direct and indirect (overhead) practice expenses, and the malpractice expenses
typically involved in furnishing that service. Each of these three relative value components is multiplied by a geographic adjustment
factor to adjust the payment for variations in the costs of furnishing services in different localities. Relative value units,
or RVUs, are summed for each service and then are multiplied by a fixed-dollar conversion factor to establish the payment amount
for each service. The higher the number of RVUs assigned to a service, the higher the payment. Under the Medicare fee-for-service
payment system, an individual can choose any licensed physician enrolled in Medicare and use the services of any healthcare provider
or facility certified by Medicare.

 

CMS
is required to limit the growth in spending under the physician fee schedule by a predetermined sustained growth rate, or SGR.
If implemented as mandated, the SGR would result in significant payment reductions under the physician fee schedule. Every year
since 2003, Congress has delayed application of the SGR, but we cannot predict with certainty whether it will continue to do so.
Congress most recently delayed application of the SGR in the Protecting Access to Medicare Act of 2014, or PAMA, which became
effective on April 1, 2014. In March of 2014 (prior to the passage of PAMA), CMS announced that the estimated physician fee schedule
update for 2014 would be reduced by 20.9% due to the SGR formula. PAMA provides for the continuation of the 0.5% reimbursement
increase to the physician payment schedule through December 31, 2014 (originally provided under the Pathway for SGR Reform Act
of 2013), and it also provides for no change to the physician fee schedule through March 31, 2015. Although several recent legislative
proposals have sought to impose permanent or semi-permanent solutions to the SGR reductions, we cannot predict with certainty
whether the SGR will be repealed or if another formula would be substituted and what form that might take. Repeal of the SGR could
be offset by further reductions in Medicare payments, and any such reductions could have a material adverse effect on our business.

 

Furthermore,
the ACA reduces annual payment updates for certain providers and reduces Medicare payments for certain procedures, and the Budget
Control Act of 2011, or BCA, requires automatic spending reductions for each fiscal year through 2021. As a result of the BCA
and subsequent activity in Congress, a $1.2 trillion sequester (across-the-board spending cuts) in discretionary programs took
effect in 2013. In particular, a 2% reduction in Medicare payments took effect on April 1, 2013 and has recently been extended
for an additional two years beyond the original expiration date of 2021.

 

Following
the intended acquisition, or opening, of one or more clinics or staffing primary healthcare practitioners in the United States,
we will be subject to CMS’ RAC program.

 

The
Medicare Prescription Drug, Improvement and Modernization Act of 2003, or MMA, introduced on a trial basis the use of RACs for
the purpose of identifying and recouping Medicare overpayments and underpayments. Any overpayment received from Medicare is considered
a debt owed to the federal government. In October 2008, CMS made the RAC program permanent. RACs review Medicare claims to determine
whether such claims were appropriately reimbursed by Medicare. RACs engage in an automated review and in a complex review of claims.
Automated reviews are conducted when a review of the medical record is not required and there is certainty that the service is
not covered or is coded incorrectly. Complex reviews involve the review of all underlying medical records supporting the claim;
and are generally conducted where there is a high likelihood, but not certainty, that an overpayment has occurred. RACs are paid
a contingency fee based on overpayments identified and collected.

 

A
Medicare administrative contractor, or MAC, may suspend Medicare payments to a provider if it determines that an overpayment has
occurred. When a Medicare claim for payment is filed, the MAC will notify the patient and the provider of its initial determination
regarding reimbursement. The MAC may deny the claim for one of several reasons, including the lack of necessary information or
lack of medical necessity for the services rendered. Providers may appeal any denials for claim payments.

 

 

Following
the intended acquisition, or opening, of one or more clinics or staffing primary healthcare practitioners in the United States,
any such reviews under the RAC program or denials by the MAC could have a material adverse effect on our results of operations.

 

Following
the intended acquisition, or opening, of one or more clinics or staffing primary healthcare practitioners in the United States,
we will be subject to the Anti-Kickback Statute, FCA, Civil Monetary Penalties statute and analogous provisions of applicable
state laws and could face substantial penalties if we fail to comply with such laws.

 

Anti-Kickback
Statute

 

Following
the intended acquisition, or opening, of one or more clinics or staffing primary healthcare practitioners in the United States,
if we are participants in the Medicare program, we will be subject to the Anti-kickback Statute. The Anti-Kickback Statute prohibits
the knowing and willful offer, payment, solicitation or receipt of remuneration, directly or indirectly, in return for the referral
of patients or arranging for the referral of patients, or in return for the recommendation, arrangement, purchase, lease or order
of items or services that are covered, in whole or in part, by a federal healthcare program such as Medicare or Medicaid. The
term “remuneration” has been broadly interpreted to include anything of value such as gifts, discounts, rebates, waiver
of payments or providing anything at less than its fair market value. The ACA amended the intent requirement of the Anti-Kickback
Statute such that a person or entity can be found guilty of violating the statute without actual knowledge of the statute or specific
intent to violation the statute. Further, the ACA now provides that claims submitted in violation of the Anti-Kickback Statute
constitute false or fraudulent claims for purposes of the civil False Claims Act, or FCA, including the failure to timely return
an overpayment. Many states have adopted similar prohibitions against kickbacks and other practices that are intended to influence
the purchase, lease or ordering of healthcare items and services reimbursed by a governmental health program or state Medicaid
program. Some of these state prohibitions apply to remuneration for referrals of healthcare items or services reimbursed by any
third-party payor, including commercial payors.

 

Following
the intended acquisition, or opening, of one or more clinics or staffing primary healthcare practitioners in the United States,
if we accept funds from governmental health programs, we will be subject to the Anti-Kickback Statute. Violations of the Anti-Kickback
Statute can result in exclusion from Medicare, Medicaid or other governmental programs as well as civil and criminal penalties,
such as $25,000 per violation and up to three times the remuneration involved. If in violation, we may be required to enter into
settlement agreements with the government to avoid such sanctions. Typically, such settlement agreements require substantial payments
to the government in exchange for the government to release its claims, and may also require entry into a corporate integrity
agreement, or CIA. Any such sanctions or obligations contained in a CIA could have a material adverse effect on our business,
financial condition and results of operations.

 

False
Claims Act

 

The
federal civil FCA prohibits providers from, among other things, (1) knowingly presenting or causing to be presented, claims for
payments from the Medicare, Medicaid or other federal healthcare programs that are false or fraudulent; (2) knowingly making,
using or causing to be made or used, a false record or statement to get a false or fraudulent claim paid or approved by the federal
government; or (3) knowingly making, using or causing to be made or used, a false record or statement to avoid, decrease or conceal
an obligation to pay money to the federal government. The “qui tam” or “whistleblower” provisions of the
FCA allow private individuals to bring actions under the FCA on behalf of the government. These private parties are entitled to
share in any amounts recovered by the government, and, as a result, the number of “whistleblower” lawsuits that have
been filed against providers has increased significantly in recent years. Defendants found to be liable under the FCA may be required
to pay three times the actual damages sustained by the government, plus mandatory civil penalties ranging between $5,500 and $11,000
for each separate false claim.

 

There
are many potential bases for liability under the FCA. The government has used the FCA to prosecute Medicare and other government
healthcare program fraud such as coding errors, billing for services not provided, and providing care that is not medically necessary
or that is substandard in quality. The ACA also provides that claims submitted in connection with patient referrals that results
from violations of the Anti-Kickback Statute constitute false claims for the purpose of the FCA, and some courts have held that
a violation of the Stark law can result in FCA liability, as well. In addition, a number of states have adopted their own false
claims and whistleblower provisions whereby a private party may file a civil lawsuit in state court. Following the acquisition
of one or more clinics or staffing primary healthcare practitioners in the United States, we will be required to provide information
to our employees and certain contractors about state and federal false claims laws and whistleblower provisions and protections.

 

 

Civil
Monetary Penalties Statute

 

The
federal Civil Monetary Penalties statute prohibits, among other things, the offering or giving of remuneration to a Medicare or
Medicaid beneficiary that the person or entity knows or should know is likely to influence the beneficiary’s selection of
a particular provider or supplier of items or services reimbursable by a federal or state healthcare program.

 

The
scope and enforcement of each of these laws is uncertain and subject to constant change. Federal and state enforcement entities
have significantly increased their scrutiny of healthcare companies and providers which has led to investigations, prosecutions,
convictions and large settlements. Following the acquisition of one or more clinics or staffing primary healthcare practitioners
in the United States, although we intend to conduct our business in compliance with all applicable United States federal and state
fraud and abuse laws, many of these laws are broadly worded and may be interpreted or applied in ways that cannot be predicted
with any certainty. Therefore, we cannot assure you that our arrangements or business practices will not be subject to government
scrutiny or will be found to be in compliance with applicable fraud and abuse laws. Further, responding to investigations can
be time consuming and result in significant legal fees and can potentially divert management’s attention from the Company.

 

Following
the intended acquisition, or opening, of one or more clinics or staffing primary healthcare practitioners in the United States,
we will be subject to the data privacy, security and breach notification requirements of HIPAA, HITECH and other data privacy
and security laws, and the failure to comply with these rules, or allegations that we have failed to do so, could result in civil
or criminal sanctions.

 

Following
the intended acquisition, or opening, of one or more multidisciplinary primary healthcare clinics or the staffing of multidisciplinary
primary healthcare clinics, affiliate clinics or eldercare centric homes with clinicians and practitioners in the United States,
numerous federal and state laws and regulations, including HIPAA and HITECH, will govern the collection, dissemination, security,
use and confidentiality of patient-identifiable health information. As required by HIPAA, HHS has adopted standards to protect
the privacy and security of this health-related information. The HIPAA privacy regulations contain detailed requirements concerning
the use and disclosure of individually identifiable health information and the grant of certain rights to patients with respect
to such information by “covered entities.” The Company and each of our clinics is considered a covered entity under
HIPAA. We will take actions to comply with the HIPAA privacy regulations including the creation and implementation of policies
and procedures, staff training, execution of HIPAA-compliant contractual arrangements with certain service providers and various
other measures. Although we believe we will be in substantial compliance, ongoing implementation and oversight of these measures
involves significant time, effort and expense.

 

In
addition to the privacy requirements, HIPAA covered entities must implement certain administrative, physical, and technical security
standards to protect the integrity, confidentiality and availability of certain electronic health-related information received,
maintained, or transmitted by covered entities or their business associates. Although, we will take actions in an effort to be
in compliance with these security regulations, a security incident that bypasses our information security systems causing an information
security breach, loss of PHI or other data subject to privacy laws or a material disruption of our operational systems could have
a material adverse effect on our business, along with fines. Furthermore, ongoing implementation and oversight of these security
measures involves significant time, effort and expense.

 

Further,
HITECH, as implemented in part by an omnibus final rule published in the Federal Register on January 25, 2013, further requires
that patients be notified of any unauthorized acquisition, access, use, or disclosure of their unsecured PHI that compromises
the privacy or security of such information. HHS has established the presumption that all unauthorized uses or disclosures of
unsecured PHI constitute breaches unless the covered entity or business associate establishes that there is a low probability
the information has been compromised. HITECH and implementing regulations specify that such notifications must be made without
unreasonable delay and in no case later than 60 calendar days after discovery of the breach. Breaches affecting 500 patients or
more must be reported immediately to HHS, which will post the name of the breaching entity on its public website. Furthermore,
breaches affecting 500 patients or more in the same state or jurisdiction must also be reported to the local media. If a breach
involves fewer than 500 people, the covered entity must record it in a log and notify HHS of such breaches at least annually.
These breach notification requirements apply not only to unauthorized disclosures of unsecured PHI to outside third parties but
also to unauthorized internal access to or use of such PHI.

 

 

The
scope of the privacy and security requirements under HIPAA was substantially expanded by HITECH, which also increased penalties
for violations. Penalties for violations of these laws vary. For instance, penalties for failure to comply with a requirement
of HIPAA and HITECH vary significantly, and include significant civil monetary penalties and, in certain circumstances, criminal
penalties with fines up to $250,000 per violation and/or imprisonment. In addition, numerous breach incidents could lead to possible
penalties in excess of $1.68 million. A person who knowingly obtains or discloses individually identifiable health information
in violation of HIPAA may face a criminal penalty of up to $50,000 and up to one-year imprisonment. The criminal penalties increase
if the wrongful conduct involves false pretenses or the intent to sell, transfer or use identifiable health information for commercial
advantage, personal gain or malicious harm. The amount of penalty that may be assessed depends, in part, upon the culpability
of the applicable covered entity or business associate in committing the violation. Some penalties for certain violations that
were not due to “willful neglect” may be waived by the Secretary of HHS in whole or in part, to the extent that the
payment of the penalty would be excessive relative to the violation. HITECH also authorized state attorneys general to file suit
on behalf of residents of their states. Applicable courts may be able to award damages, costs and attorneys’ fees related
to violations of HIPAA in such cases. HITECH also mandates that the Secretary of HHS conduct periodic compliance audits of a cross-section
of HIPAA covered entities and business associates. Every covered entity and business associate is subject to being audited, regardless
of the entity’s compliance record.

 

State
laws may impose more protective privacy restrictions related to health information and may afford individuals a private right
of action with respect to the violation of such laws. Both state and federal laws are subject to modification or enhancement of
privacy protection at any time. We are subject to any federal or state privacy-related laws that are more restrictive than the
privacy regulations issued under HIPAA. These statutes vary and could impose additional requirements on us and more severe penalties
for disclosures of health information. If we fail to comply with HIPAA, similar state laws or any new laws, including laws addressing
data confidentiality, security or breach notification, we could incur substantial monetary penalties and substantial damage to
our reputation.

 

States
may also impose restrictions related to the confidentiality of personal information that is not considered PHI under HIPAA, including
certain identifying information and financial information of our patients. Theses state laws may impose additional notification
requirements in the event of a breach of such personal information. Failure to comply with such data confidentiality, security
and breach notification laws may result in substantial monetary penalties.

 

HIPAA
and HITECH also include standards for common healthcare electronic transactions and code sets, such as claims information, plan
eligibility and payment information. Covered entities such as the Company and each of our centers will be required to conform
to such transaction set standards.

 

Following
the intended acquisition, or opening, of one or more multidisciplinary primary healthcare clinics or the staffing of multidisciplinary
primary healthcare clinics, affiliate clinics or eldercare centric homes with clinicians and practitioners in the United States,
if we fail to effectively and timely implement electronic health record systems, our operation could be adversely affected.

 

As
required by the American Recovery and Reinvestment Act of 2009, the Secretary of HHS has developed and implemented an incentive
payment program for eligible healthcare professionals that adopt and meaningfully use electronic health record, or EHR, technology.
HHS uses the Provider Enrollment, Chain and Ownership System, or PECOS, to verify Medicare enrollment prior to making EHR incentive
program payments. If our employed professionals are unable to meet the requirements for participation in the incentive payment
program, including having an enrollment record in PECOS, we will not be eligible to receive incentive payments that could offset
some of the costs of implementing EHR systems. Further, healthcare professionals that fail to demonstrate meaningful use of certified
EHR technology are subject to reduced payments from Medicare. System conversions to comply with EHR could be time consuming and
disruptive for physicians and employees. Failure to implement EHR systems effectively and in a timely manner could have a material
adverse effect on our financial position and results of operations.

 

 

Following
the intended acquisition, or opening, of one or more clinics or staffing primary healthcare practitioners in the United States,
we will convert certain of our clinical and patient accounting information system applications to newer versions of existing applications
or altogether new applications. In connection with our implementation and conversions, we will likely incur capitalized costs
and additional training and implementation expenses.

 

If
we fail to comply with laws and regulations related to the protection of the environment and human health and safety, we could
incur substantial penalties and fines.

 

We
are subject to various federal, state and local and regulations relating to the protection of the environment and human health
and safety, including those governing the management and disposal of hazardous substances and wastes, the cleanup of contaminated
sites and the maintenance of a safe workplace. Some of our operations include the use, generation and disposal of hazardous materials.
We also plan to acquire ownership in new facilities and properties, some of which may have had a history of commercial or other
operations. We may, in the future, incur liability under environmental statutes and regulations with respect to contamination
of sites we own or operate, including contamination caused by prior owners or operators of such sites, abutters or other persons,
and the off-site disposal of hazardous substances. Violations of these laws and regulations may result in substantial civil penalties
or fines.

 

Risks
Related to our Telemedicine Medical Technology Platform, Remote Patient Monitoring Medical Technology Platform and Novo Connect
Medical Technology Platform

 

We
may be unsuccessful in the development, usage, application and commercialization of each or all of our Medical Technology Platforms.

 

Our
Telemedicine Medical Technology Platform, which is currently operating with limited usage and remains primarily under development,
is intended to provide patients with real-time access to third-party primary care medically licensed physicians and specialists
in various disciplines as well as multidisciplinary health care clinicians. Telemedicine is transforming traditional approaches
to all components of the health industry by providing ease of access and reduced costs for patients, particularly in areas with
limited access to primary care licensed physicians, nurses, nurse practitioners, specialists and multidisciplinary primary care
clinicians. Our advanced Telemedicine Medical Technology Platform intends to integrate certain medical devices, such as a blood
pressure reading device, a derma scope and an ophthalmoscope otoscope, each of which can provide the doctor with real-time diagnostic
data, greatly enhancing the doctor’s ability to provide the patient with an accurate diagnosis. Our Telemedicine Medical
Technology Platform is intended to allow any type of health care clinic or location to install and utilize our Telemedicine Medical
Technology Platform at a relatively low-cost point of entry.

 

Our
Remote Patient Monitoring Medical Technology Platform, which is currently operating with limited usage and remains primarily under
development, is intended to empower a patient with real-time vital sign information while maintaining a direct technology link
from patient to clinician or medical practitioner. The transfer of vital information from home to clinic or patient to clinician
allows for the delivery of high quality, non-redundant diagnostic based proactive healthcare. We intend to expand our RPM Platform
to not only our Canadian clinics and affiliate clinics but to clinics and medically licensed providers throughout Canada and the
United States.

 

Our
Novo Connect Medical Technology Platform is currently in development and build-out. Novo Connect is intended to be an app designed
as a secure patient-centered portal which will allow the integration of numerous source systems for patient interface by facilitating
communication between the patient and the patient’s provider. The Novo Connect app will be developed for Web, iOS and Android
application to optimize communication between source systems. Novo Connect is being designed to allow patients to have direct
control of their overall healthcare and wellness by providing a suite of secure, reliable engagement features.

 

 

The
success of our Medical Technology Platforms will highly be dependent upon our ability to develop relationships with both Canadian
based and United States based medically licensed primary care providers and specialist in addition to multidisciplinary primary
health care clinicians.

 

Our
success will highly be dependent upon our ability to develop relationship with our patients, primary care medically licensed physicians,
nurse practitioners, and specialists in addition to multidisciplinary primary health care clinicians and practitioners. If we
cannot generate relationships with these medical professionals to translate into service contracts or license agreements for our
Medical Technology Platforms, we may need to cease the development and commercialization of each or all Medical Technology Platform.

 

Our
Medical Technology Platforms may not be accepted in the Canadian and United States marketplace.

 

Uncertainty
exists as to whether our Medical Technology Platforms will be accepted by potential users; including, but not limited to third-party
Canadian based and United States based primary care medically licensed physicians and specialists in various medical disciplines,
multidisciplinary primary care clinicians and practitioners; as well as patients. A number of factors may limit the market acceptance
of our Medical Technology Platforms including the price relative to other product offerings. There is a risk that primary care
medically licensed physicians and specialists, multidisciplinary primary health care clinicians or patient acceptance will be
encouraged to continue to use other products and/or methods instead of ours. We are assuming that, notwithstanding the fact that
our Medical Technology Platforms will be new in the market, primary care medically licensed physicians and specialists, multidisciplinary
health care clinicians, or patient acceptance will elect not to use each or all of our Medical Technology Platforms simply because
it will provide ease of access and reduced costs for patients.

 

Primary
care medically licensed physicians and specialists, multidisciplinary health care clinicians and patients need to be persuaded
that our Medical Technology Platform services are justified for the anticipated benefit, but there is no assurance that sufficient
numbers of patients will be convinced to enable a successful market to develop for each or all of our Medical Technology Platforms.

 

In
the event that we are not able to market and significantly increase the number of primary care medically licensed physicians and
specialists, multidisciplinary health care clinicians, or patients that use our Medical Technology Platforms, or if we are unable
to charge the necessary prices, we may need to cease operating each or all of our Medical Technology Platforms.

 

Defects
or malfunctions in our Medical Technology Platforms could hurt our reputation, sales and profitability.

 

The
acceptance of our Medical Technology Platforms will depend upon their effectiveness and reliability. Each of our Medical Technology
Platforms will be complex and will be continually modified and improved, and as such may contain undetected defects or errors
when first introduced or as new versions are released. To the extent that defects or errors cause each or all of our Medical Technology
Platforms to malfunction and our customers’ use of our Medical Technology Platforms is interrupted, our reputation could
suffer, and our potential revenues could decline or be delayed while such defects are remedied. We may also be subject to liability
for the defects and malfunctions.

 

There
can be no assurance that, despite our testing, errors will not be found in each or all of our Medical Technology Platforms or
new releases, resulting in loss of future revenues or delay in market acceptance, diversion of development resources, damage to
our reputation, adverse litigation, or increased service, any of which would have a material adverse effect upon our business,
operating results and financial condition.

 

Software
failures, breakdowns in the operations of our servers and communications systems or the failure to implement system enhancements
could harm our business.

 

The
operational success of our Medical Technology Platforms will depend on the efficient and uninterrupted operation of our servers
and communications systems. A failure of our network or data gathering procedures could impede services and could result in the
loss of primary care medically licensed physician and specialists, multidisciplinary primary care clinicians or patients. While
all our operations will have disaster recovery plans in place, they might not adequately protect us. Despite any precautions we
take, damage from fire, floods, hurricanes, power loss, telecommunications failures, computer viruses, break-ins and similar events
at our computer facilities could result in interruptions in the flow of data to our servers and from our servers to our clients.
In addition, any failure by our computer environment to provide our required data communications capacity could result in interruptions
in our service. In the event of a server failure, we could be required to transfer our client data collection operations to an
alternative provider of server hosting services. Such a transfer could result in delays in our ability to deliver our products
and services to our clients.

 

 

Additionally,
significant delays in the planned delivery of system enhancements, improvements, and inadequate performance of the systems once
they are completed could damage our reputation and harm our business. Long-term disruptions in the infrastructure caused by events
such as natural disasters, the outbreak of war, the escalation of hostilities and acts of terrorism, particularly involving cities
in which we have offices, could adversely affect our businesses. Although, we plan to carry property and business interruption
insurance for our business operations, our coverage might not be adequate to compensate us for all losses that may occur.

 

We
face risks related to the storage of customers’ and their end users’ confidential and proprietary information.

 

Our
Medical Technology Platforms are being designed to maintain the confidentiality and security of our patients’ confidential
and proprietary data stored on our server systems, which may include sensitive personal data. However, any accidental or willful
security breaches or other unauthorized access to these data could expose us to liability for the loss of such information, time-consuming
and expensive litigation and other possible liabilities as well as negative publicity. Techniques used to obtain unauthorized
access or to sabotage systems change frequently and generally are difficult to recognize and react to. We may be unable to anticipate
these techniques or implement adequate preventative or reactionary measures.

 

We
might incur substantial expense to further develop each or all of our Medical Technology Platforms which may never become sufficiently
successful.

 

Our
business growth initiatives include the successful development, launch and operations of each and all of our Medical Technology
Platforms. Although management will take every precaution to ensure that our Medical Technology Platforms will, with a high degree
of likelihood, achieve commercial success, there can be no assurance that this will be the case. The causes for failure of each
or all of our Medical Technology Platforms, once commercialized, can be numerous, including:

 

●       market
demand for each or all of our Medical Technology Platforms proves to be smaller than we expect;

 

●       further
each or all of our Medical Technology Platform’s development (i) turns out to be costlier than anticipated or takes longer;
(ii) requires significant adjustment post commercialization, rendering the each or all of our Medical Technology Platforms uneconomic
or extending considerably the likely investment return period; (iii) additional regulatory requirements may increase the overall
costs of the development; patent conflicts or unenforceable intellectual property rights; and (iv) primary care medically licensed
physicians and specialists and clients may be unwilling to adopt and/or use each or all of our Medical Technology Platforms.

 

●       Compliance
with changing regulations concerning corporate governance and public disclosure may result in additional expenses.

 

We
cannot be certain that we will obtain patents for each or all of our Medical Technology Platforms or that such patent will protect
us from competitors.

 

We
believe that our success and competitive position will depend in part on our ability to obtain and maintain patents for each or
all of our Medical Technology Platforms, which is both costly and time consuming. We still are in the process of evaluating the
patent potential of each and all of our Medical Technology Platforms.  The Patent Office typically requires 12-24 months
or more to process a patent application. There can be no assurance that any of our potential patent applications will be approved.
There can be no assurance that any potential patent issued or licensed to us will provide us with protection against competitive
products, protect us against changes in industry trends which we have may not have anticipated or otherwise protect the commercial
viability of each or all of our Medical Technology Platforms, or that challenges will not be instituted against the validity or
enforceability of any of our future patents or, if instituted, that such challenges will not be successful. The cost of litigation
to uphold the validity of a patent and enforce it against infringement can be substantial. Even issued patents may later be modified
or revoked by the Patent and Trademark Office or in legal proceedings. Patent applications in the United States and Canada are
maintained in secrecy until the patent issues and, since publication of patents tends to lag behind actual discoveries, we cannot
be certain that if we obtain patents for our product, we were the first creator of the inventions covered by a pending patent
applications or the first to file patent applications on such inventions.

 

 

Government
regulation of the Internet and e-commerce is evolving, and unfavorable changes could substantially harm our business and results
of operations.

 

We
are subject to general business regulations and laws as well as federal, state and provincial regulations and laws specifically
governing the internet and e-commerce. Existing and future laws and regulations may impede the growth of the use of the internet,
availability of economic broadband access, or other online services, and increase the cost of providing our digital delivery of
content and services. These regulations and laws may cover taxation, tariffs, user privacy, data protection, pricing, content,
copyrights, distribution, electronic contracts and other communications, consumer protection, broadband internet access and the
characteristics and quality of services. It is not clear how existing laws governing issues such as property ownership, sales,
use and other taxes, libel and personal privacy apply to the internet and e-commerce. Unfavorable resolution of these issues may
harm our business and results of operations.

 

Risks
Related to the United States Regulatory System as to Medicinal CBD Products

 

Possible
yet unanticipated changes in federal and state law could cause any products that we intend to launch, containing hemp-derived
CBD oil to be illegal, or could otherwise prohibit, limit or restrict any of our prospective products containing CBD.

 

Until
2014, when 7 U.S. Code §5940 became federal law as part of the Agricultural Act of 2014 (the “2014 Farm Act”),
products containing oils derived from hemp, notwithstanding a minimal or non-existing THC content, were classified as Schedule
I illegal drugs. The 2014 Farm Act expired on September 30, 2018, and was thereafter replaced by the Agricultural Improvement
Act of 2018 on December 20, 2018 (the “2018 Farm Act “), which amended various sections of the U.S. Code, thereby
removing hemp, defined as cannabis with less than 0.3% of THC, from Schedule 1 status under the Controlled Substances Act (“CSA”),
and legalizing the cultivation and sale of hemp at the federal level, subject to compliance with certain federal requirements
and state law, amongst other things. THC is the psychoactive component of plants in the cannabis family generally identified as
marihuana or marijuana. We anticipate our prospective medical CBD products will be federally legal in the United States in that
they will contain less than 0.3% of THC in compliance with the 2018 Farm Bill guidelines and will have no psychoactive effects
on our patients and customers bodies. Notwithstanding, there is no assurance that the 2018 Farm Act will not be repealed or amended
such that our products containing hemp-derived CBD would once again be deemed illegal under federal law.

 

The
2018 Farm Bill also shifted regulatory authority from the Drug Enforcement Administration to the Department of Agriculture. The
2018 Farm Bill did not change the United States Food and Drug Administration’s (“FDA”) oversight authority over
CBD products. The 2018 Farm Act delegated the authority to the states to regulate and limit the production of hemp and hemp derived
products within their territories. Although many states have adopted laws and regulations that allow for the production and sale
of hemp and hemp derived products under certain circumstances, no assurance can be given that such state laws may not be repealed
or amended such that our intended products containing hemp-derived CBD would once again be deemed illegal under the laws of one
or more states now permitting such products, which in turn would render such intended products illegal in those states under federal
law even if the federal law is unchanged. In the event of either repeal of federal or of state laws and regulations, or of amendments
thereto that are adverse to our prospective medicinal CBD products, we may be restricted or limited with respect to those products
that we may sell or distribute, which could adversely impact our intended business plan with respect to such intended products.

 

Additionally,
the FDA has indicated its view that certain types of products containing CBD may not be permissible under the United States Federal
Food, Drug and Cosmetic Act (“FDCA”). The FDA’s position is related to its approval of Epidiolex, a marijuana-derived
prescription medicine to be available in the United States. The active ingredient in Epidiolex is CBD. On December 20, 2018, after
the passage of the 2018 Farm Bill, FDA Commissioner Scott Gottlieb issued a statement in which he reiterated the FDA’s position
that, among other things, the FDA requires a cannabis product (hemp-derived or otherwise) that is marketed with a claim of therapeutic
benefit, or with any other disease claim, to be approved by the FDA for its intended use before it may be introduced into interstate
commerce and that the FDCA prohibits introducing into interstate commerce food products containing added CBD, and marketing products
containing CBD as a dietary supplement, regardless of whether the substances are hemp-derived. Although our prospective medicinal
CBD product offerings will comply with applicable federal and state laws and regulations, legal proceedings alleging violations
of such laws could have a material adverse effect on our business, financial condition and results of operations.

 

 

FDA
regulation could negatively affect the hemp industry, which would directly affect our financial condition.

 

The
FDA may seek expanded regulation of hemp under the FDCA. Additionally, the FDA may issue rules and regulations, including certified
good manufacturing practices, or cGMPs, related to the growth, cultivation, harvesting and processing of hemp. Clinical trials
may be needed to verify efficacy and safety. It is also possible that the FDA would require that facilities where hemp is grown
register with the FDA and comply with certain federally prescribed regulations. In the event some or all of these regulations
are imposed, we do not know what the impact would be on the hemp industry, including what costs, requirements and possible prohibitions
may be enforced. If we or our partners are unable to comply with the regulations or registration as prescribed by the FDA, we
and or our partners (including C2M) may be unable to continue to operate their and our business in its current or planned form
or at all.

 

Sources
of hemp-derived CBD depend upon legality of cultivation, processing, marketing and sales of products derived from those plants
under state law of the United States.

 

Hemp-derived
CBD can only be legally produced in states that have laws and regulations that allow for such production and that comply with
the 2018 Farm Act, apart from state laws legalizing and regulating medical and recreational cannabis or marijuana, which remains
illegal under federal law and regulations. Initially, we intend to use hemp-derived CBD from growers and processors in Canada
where such production is legal to produce our prospective medicinal CBD products. Although hemp and hemp seeds may legally be
imported into the United States, the importation of products containing THC, including CBD products, into the United States may
be illegal if the CBD products cause THC to enter the human body. In that case, we will be required to purchase all our hemp-derived
prospective medicinal CBD products from licensed growers and processors in states in the United States where such production is
legal. In addition, as described in the preceding risk factor, in the event of repeal or amendment of laws and regulations which
are now favorable to the cannabis/hemp industry in such states, we would be required to locate new suppliers in states with laws
and regulations that qualify under the 2018 Farm Act. If we were to be unsuccessful in arranging new sources of supply of our
raw ingredients, or if our raw ingredients were to become legally unavailable, our intended business plan with respect to such
products could be adversely impacted.

 

Because
our distributors may only sell and ship our products containing hemp-derived CBD in states that have adopted laws and regulations
qualifying under the 2018 Farm Act, a reduction in the number of states having such qualifying laws and regulations could limit,
restrict or otherwise preclude the sale of intended products containing hemp-derived CBD.

 

The
interstate shipment of hemp-derived CBD from one state to another is legal only where both states have laws and regulations that
allow for the production and sale of such products and that qualify under the 2018 Farm Act. Therefore, the marketing and sale
of our intended products containing hemp-derived CBD is limited by such factors and is restricted to such states. Although we
believe we may lawfully sell any of our finished products, including those containing CBD, in a majority of states, a repeal or
adverse amendment of laws and regulations that are now favorable to the distribution, marketing and sale of finished products
we intend to sell could significantly limit, restrict or prevent us from generating revenue related to our products that contain
hemp-derived CBD. Any such repeal or adverse amendment of now favorable laws and regulations could have an adverse impact on our
business plan with respect to such products.

 

Due
to projected expansion into the CBD industry, we may have a difficult time obtaining the various insurances that are desired to
operate our business, which may expose us to additional risk and financial liability.

 

Insurance
that is otherwise readily available, such as general liability, and directors and officer’s insurance, may become more difficult
for us to find, and more expensive, due to our intended launch of certain medically related products containing hemp-derived CBD.
There are no guarantees that we will be able to find such insurances in the future, or that the cost will be affordable to us.
If we are forced to go without such insurances, it may prevent us from entering into certain business sectors, may inhibit our
growth, and may expose us to additional risk and financial liabilities.

 

 

Our
products may not meet health and safety standards or could become contaminated.

 

We
have adopted various quality, environmental, health and safety standards. We do not have control over all the third parties involved
in the manufacturing of our products and their compliance with government health and safety standards. Even if our products meet
these standards, they could otherwise become contaminated. A failure to meet these standards or contamination could occur in our
operations or those of our manufacturers, distributors or suppliers. This could result in expensive production interruptions,
recalls and liability claims. Moreover, negative publicity could be generated from false, unfounded or nominal liability claims
or limited recalls. Any of these failures or occurrences could negatively affect our business and financial performance.

 

The
sale of our products involves product liability and related risks that could expose us to significant insurance and loss expenses.

 

We
face an inherent risk of exposure to product liability claims if the use of our products results in, or is believed to have resulted
in, illness or injury. Our products contain combinations of ingredients, and there is little long-term experience with the effect
of these combinations. In addition, interactions of these products with other products, prescription medicines and over-the-counter
drugs have not been fully explored or understood and may have unintended consequences. While our third-party manufacturers perform
tests in connection with the formulations of our products, these tests are not designed to evaluate the inherent safety of our
products.

 

Any
product liability claim may increase our costs and adversely affect our revenue and operating income. Moreover, liability claims
arising from a serious adverse event may increase our costs through higher insurance premiums and deductibles and may make it
more difficult to secure adequate insurance coverage in the future. In addition, our product liability insurance may fail to cover
future product liability claims, which, if adversely determined, could subject us to substantial monetary damages.

 

Confusion
between legal CBD and illegal Cannabis

 

There
is the risk that confusion or uncertainty surrounding products that are offered with regulated cannabis could occur on the state
or federal level and impact us. We may have difficulty with establishing banking relationships, working with investment banks
and brokers who would be willing to offer and sell our securities or accept deposits from shareholders, and auditors willing to
certify our financial statements if we are confused with businesses that are in the cannabis business. Any of these additional
factors, should they occur, could also affect our business, prospects, assets or results of operation could have a material adverse
effect on the business, prospects, results of operations or financial condition of the Company.

 

Risks
Related to our Common Stock and our Status as a Public Company

 

As
a result of being a public company, we are subject to additional reporting and corporate governance requirements that will require
additional management time, resources and expense.

 

As
a public company we are obligated to file with the SEC annual and quarterly information and other reports that are specified in
the Exchange Act. We are also subject to other reporting and corporate governance requirements under the Sarbanes-Oxley Act of
2002, as amended, and the rules and regulations promulgated thereunder, all of which impose significant compliance and reporting
obligations upon us and require us to incur additional expense in order to fulfill such obligations.

 

Trading
on the OTC Markets is volatile and sporadic, which could depress the market price of our common stock and make it difficult for
our security holders to sell their common stock.

 

Our
common stock is quoted on the OTCQB tier of the OTC Markets. Trading in securities quoted on the OTC Markets is often thin and
characterized by wide fluctuations in trading prices, due to many factors, some of which may have little to do with our operations
or business prospects. This volatility could depress the market price of our common stock for reasons unrelated to operating performance.
Moreover, the OTC Markets is not a stock exchange, and trading of securities on the OTC Markets is often more sporadic than the
trading of securities listed on a quotation system like Nasdaq Capital Market or a stock exchange like the NYSE American. These
factors may result in investors having difficulty selling any shares of our common stock.

 

 

Our
stock price is likely to be highly volatile because of several factors, including a limited public float.

 

The
market price of our common stock has been volatile in the past and the market price of our common stock is likely to be highly
volatile in the future. You may not be able to sell shares of our common stock following periods of volatility because of the
market’s adverse reaction to volatility.

 

Other
factors that could cause such volatility may include, among other things:

 

●       actual
or anticipated fluctuations in our operating results;

 

●       the
absence of securities analysts covering us and distributing research and recommendations about us;

 

●       we
may have a low trading volume for a number of reasons, including that a large portion of our stock is closely held;

 

●       overall
stock market fluctuations;

 

●       announcements
concerning our business or those of our competitors;

 

●       actual
or perceived limitations on our ability to raise capital when we require it, and to raise such capital on favorable terms;

 

●       conditions
or trends in the industry;

 

●       litigation;

 

●       changes
in market valuations of other similar companies;

 

●       future
sales of common stock;

 

●       departure
of key personnel or failure to hire key personnel; and

 

●       general
market conditions.

 

Any
of these factors could have a significant and adverse impact on the market price of our common stock and/or warrants. In addition,
the stock market in general has at times experienced extreme volatility and rapid decline that has often been unrelated or disproportionate
to the operating performance of particular companies. These broad market fluctuations may adversely affect the trading price of
our common stock and/or warrants, regardless of our actual operating performance.

 

Our
common stock is a “penny stock” under SEC rules. It may be more difficult to sell securities classified as “penny
stock.”

 

Our
common stock is a “penny stock” under applicable SEC rules (generally defined as non-exchange traded stock with a
per-share price below $5.00). Unless we successfully list our common stock on a national securities exchange, or maintain a per-share
price above $5.00, these rules impose additional sales practice requirements on broker-dealers that recommend the purchase or
sale of penny stocks to persons other than those who qualify as “established customers” or “accredited investors.”
For example, broker-dealers must determine the appropriateness for non-qualifying persons of investments in penny stocks. Broker-dealers
must also provide, prior to a transaction in a penny stock not otherwise exempt from the rules, a standardized risk disclosure
document that provides information about penny stocks and the risks in the penny stock market. The broker-dealer also must provide
the customer with current bid and offer quotations for the penny stock, disclose the compensation of the broker-dealer and its
salesperson in the transaction, furnish monthly account statements showing the market value of each penny stock held in the customer’s
account, provide a special written determination that the penny stock is a suitable investment for the purchaser, and receive
the purchaser’s written agreement to the transaction.

 

 

Legal
remedies available to an investor in “penny stocks” may include the following:

 

●       If
a “penny stock” is sold to the investor in violation of the requirements listed above, or other federal or states
securities laws, the investor may be able to cancel the purchase and receive a refund of the investment.

 

●       If
a “penny stock” is sold to the investor in a fraudulent manner, the investor may be able to sue the persons and firms
that committed the fraud for damages.

 

These
requirements may have the effect of reducing the level of trading activity, if any, in the secondary market for a security that
becomes subject to the penny stock rules. The additional burdens imposed upon broker-dealers by such requirements may discourage
broker-dealers from effecting transactions in our securities, which could severely limit the market price and liquidity of our
securities. These requirements may restrict the ability of broker-dealers to sell our common stock and may affect your ability
to sell our common stock.

 

Many
brokerage firms will discourage or refrain from recommending investments in penny stocks. Most institutional investors will not
invest in penny stocks. In addition, many individual investors will not invest in penny stocks due, among other reasons, to the
increased financial risk generally associated with these investments.

 

For
these reasons, penny stocks may have a limited market and, consequently, limited liquidity. We can give no assurance at what time,
if ever, our common stock will not be classified as a “penny stock” in the future.

 

If
we fail to maintain effective internal control over financial reporting, the price of our securities may be adversely affected.

 

Our
internal control over financial reporting may have weaknesses and conditions that could require correction or remediation, the
disclosure of which may have an adverse impact on the price of our common stock. We are required to establish and maintain appropriate
internal control over financial reporting. Failure to establish those controls, or any failure of those controls once established,
could adversely affect our public disclosures regarding our business, prospects, financial condition or results of operations.
In addition, management’s assessment of internal control over financial reporting may identify weaknesses and conditions
that need to be addressed in our internal control over financial reporting or other matters that may raise concerns for investors.
Any actual or perceived weaknesses and conditions that need to be addressed in our internal control over financial reporting or
disclosure of management’s assessment of our internal control over financial reporting may have an adverse impact on the
price of our common stock.

 

We
are required to comply with certain provisions of Section 404 of the Sarbanes-Oxley Act and if we fail to continue to comply,
our business could be harmed and the price of our securities could decline.

 

Rules
adopted by the SEC pursuant to Section 404 of the Sarbanes-Oxley Act require an annual assessment of internal control over financial
reporting, and for certain issuers an attestation of this assessment by the issuer’s independent registered public accounting
firm. The standards that must be met for management to assess the internal control over financial reporting as effective are evolving
and complex, and require significant documentation, testing, and possible remediation to meet the detailed standards. We expect
to incur significant expenses and to devote resources to Section 404 compliance on an ongoing basis. It is difficult for us to
predict how long it will take or costly it will be to complete the assessment of the effectiveness of our internal control over
financial reporting for each year and to remediate any deficiencies in our internal control over financial reporting. As a result,
we may not be able to complete the assessment and remediation process on a timely basis. In the event that our Chief Executive
Officer or Principal Financial Officer determines that our internal control over financial reporting is not effective as defined
under Section 404, we cannot predict how regulators will react or how the market prices of our securities will be affected; however,
we believe that there is a risk that investor confidence and the market value of our securities may be negatively affected.

 

Shares
eligible for future sale may adversely affect the market.

 

From
time to time, certain of our stockholders may be eligible to sell all or some of their shares of common stock by means of ordinary
brokerage transactions in the open market pursuant to Rule 144 promulgated under the Securities Act, subject to certain limitations.
In general, pursuant to Rule 144, non-affiliate stockholders may sell freely after six months, subject only to the current public
information requirement. Affiliates may sell after six months, subject to the Rule 144 volume, manner of sale (for equity securities),
current public information, and notice requirements. Of the approximately 23,794,098 shares of our common stock outstanding as
of February 19, 2021, approximately 3,933,535 shares are tradable without restriction.  Given the limited trading
of our common stock, resale of even a small number of shares of our common stock pursuant to Rule 144 or an effective registration
statement may adversely affect the market price of our common stock.

 

 

Substantial
future sales of shares of our common stock could cause the market price of our common stock to decline.

 

The
market price of shares of our common stock could decline as a result of substantial sales of our common stock, particularly sales
by our directors, executive officers and significant stockholders, a large number of shares of our common stock becoming available
for sale or the perception in the market that holders of a large number of shares intend to sell their shares.

 

Provisions
of our amended and restated articles of incorporation and bylaws may delay or prevent a takeover which may not be in the best
interests of our stockholders.

 

Provisions
of our amended and restated articles of incorporation and our bylaws, as amended, may be deemed to have anti-takeover effects,
which include when and by whom special meetings of our stockholders may be called, and may delay, defer or prevent a takeover
attempt. Further, our amended and restated articles of incorporation authorize the issuance of up to 1,000,000 shares of preferred
stock with such rights and preferences as may be determined from time to time by our board of directors in their sole discretion.
Our board of directors may, without stockholder approval, issue series of preferred stock with dividends, liquidation, conversion,
voting or other rights that could adversely affect the voting power or other rights of the holders of our common stock.

 

We
do not expect to pay dividends in the foreseeable future.

 

We
do not intend to declare dividends for the foreseeable future, as we anticipate that we will reinvest any future earnings in the
development and growth of our business. Therefore, investors will not receive any funds unless they sell their common stock, and
stockholders may be unable to sell their shares on favorable terms. We cannot assure you of a positive return on investment or
that you will not lose the entire amount of your investment in our common stock.

 

USE
OF PROCEEDS

 

The
proceeds from the sale of the shares offered pursuant to this prospectus are solely for the account of the selling stockholders.
We will not receive any of the proceeds from any sale of shares by the selling stockholders. To the extent the options are exercised
for cash, if at all, we will receive the exercise price for the options. See “Selling Stockholders” and “Plan
of Distribution” below.

 

DETERMINATION
OF OFFERING PRICE

 

The
selling stockholders may sell the shares offered pursuant to this prospectus at prices and at terms prevailing or at prices related
to the current market price, or in negotiated transactions.

 

SELLING
STOCKHOLDERS

 

The
common stock being registered by this prospectus consists of 1,772,000 shares of our common stock issuable upon exercise of stock
options previously granted to, and currently held by, the selling stockholders identified below. The stock options were previously
granted to the selling stockholders in exchange for bona fide services provided by the selling stockholders to the issuer and
pursuant to written stock option agreements by and between the Company and the respective selling stockholders.

 

We
are registering these shares to permit the selling stockholders to resell these shares when they deem appropriate. Each selling
stockholder may resell all, a portion, or none of the shares, at any time and from time to time. The selling stockholders may
also sell, transfer or otherwise dispose of some or all of the shares in transactions exempt from the registration requirements
of the Securities Act. We do not know when or in what amounts the selling stockholders may offer the shares of common stock for
sale under this prospectus.

 

 

The
table below sets forth information concerning the resale of the shares by the selling stockholders. We will not receive any proceeds
from the resale of the shares by the selling stockholders. To the extent the options are exercised for cash, if at all, we will
receive the exercise price for the options.

 

The
table below sets forth, as of February 19, 2021, (i) the name of each person who is offering the resale of shares by this
prospectus and their position with us; (ii) the number of shares (and the percentage, if 1% or more) of common stock beneficially
owned (as such term is defined in Rule 13d-3 under the Exchange Act) by each person; (iii) the number of shares that each selling
stockholder may offer for sale from time to time pursuant to this prospectus, whether or not such selling stockholder has a present
intention to do so; and (iv) the number of shares (and the percentage, if 1% or more) of common stock each person will own after
the offering, assuming they sell all of the shares offered. Unless otherwise indicated, beneficial ownership is direct and the
person indicated has sole voting and investment power. Unless otherwise indicated, the address for each selling stockholder listed
in the table below is c/o Novo Integrated Sciences, Inc., 11120 NE 2nd Street, Suite 100, Bellevue, WA 98004.

 

The
table below has been prepared based upon the information furnished to us by the selling stockholders as of February 19,
2021, and we have not independently verified this information. The selling stockholders identified below may have sold, transferred
or otherwise disposed of some or all of their shares since the date on which the information in the following table is presented
in transactions exempt from or not subject to the registration requirements of the Securities Act. Information concerning the
selling stockholders may change from time to time and, if necessary, we will amend or supplement this prospectus accordingly.
We cannot give an estimate as to the number of shares of common stock that will actually be held by the selling stockholders upon
termination of this offering because the selling stockholders may offer some or all of their common stock under the offering contemplated
by this prospectus or acquire additional shares of common stock. The total number of shares that may be sold hereunder will not
exceed the number of shares offered hereby. Please read the section entitled “Plan of Distribution” in this prospectus.

 

Selling
Stockholder

 
Shares
of
Common
Stock
Beneficially
Owned Prior
to this
Offering (1)

 
 
Percentage
of Common
Stock
Beneficially
Owned
Before
Resale
(2)

 
 
Shares
of
Common
Stock
Offered for
Resale in this
Offering

 
 
Shares
of
Common
Stock
Beneficially
Owned After
this Offering
(1)(3)

 
 
Percentage
of Common
Stock
Beneficially
Owned
After
Resale
(1)(2)(3)

 David
Brien 

 
 
200,000
(4)

 
 
 
*

 
 
200,000
(4)
 
 

 
 
 
        
 Enzo
Cirillo 

 
 
150,000
(4)
 
 
 
*

 
 
150,000
(4)
 
 

 
 
 

 Christopher
David

 
 
1,281,950
(5)
 
 
5.1
%
 
 
1,200,000
(4)
 
 
81,950
 
 
 
 
*Emily
Mattacchione

 
 
12,933,562
(6)
 
 
54.3
%
 
 
25,000
(4)
 
 
12,908,562
 
 
 
54.3
%Judy
Norstrud 

 
 
5,000
(4)
 
 
 
*
 
 
5,000
(4)
 
 

 
 
 

 Robert
Oliva

 
 
373,355
(7)
 
 
1.6
%
 
 
175,000
(4)
 
 
198,355
 
 
 
 
*Kevin
Pickard 

 
 
12,000
(4)
 
 
 
*
 
 
12,000
(4)
 
 

 
 
 

 Kimberly
L. Rudge 

 
 
5,000
(4)
 
 
 
*
 
 
5,000
(4)
 
 

 
 
 

 

 

 

(1)Beneficial
ownership is determined in accordance with the rules of the SEC and generally includes
voting or investment power with respect to securities. Shares of common stock underlying
options currently exercisable, or exercisable, or restricted stock units that vest, within
60 days after February 19, 2021 (as used in this section, the “Determination
Date”), are deemed outstanding for purposes of computing the beneficial ownership
of the person holding such options and/or restricted stock units but are not deemed outstanding
for computing the beneficial ownership of any other person. Except where we had knowledge
of such ownership, the number presented in this column may not include shares held in
street name or through other entities over which the selling stockholder has voting and
dispositive power.

 

(2)Percentages
are based on 23,794,098 shares of common stock issued and outstanding as of the Determination
Date.

 

(3)Assumes
all of the shares of common stock being offered are sold in the offering, that shares
of common stock beneficially owned by such selling stockholder on the Determination Date
but not being offered pursuant to this prospectus (if any) are not sold, and that no
additional shares are purchased or otherwise acquired.

 

 

(4)Represents
shares issuable upon exercise of vested stock options.

 

(5)Represents
(i) 81,950 shares owned by Mr. David, and (ii) 1,200,000 shares that may be acquired
upon exercise of vested stock options held by Mr. David. Mr. David is the Company’s
President and a member of the Board of Directors.

 

(6)Represents
(i) 12,908,562 shares owned by ALMC-ASAP Holdings, Inc. (“ALMC”), and (ii)
25,000 shares that may be acquired upon exercise of vested options held by Ms. Mattacchione.
ALMC is wholly owned by the Mattacchione Family Trust. Robert Mattacchione, Ms. Mattacchione’s
spouse, is the trustee of the Mattacchione Family Trust, with voting and depository power
over these shares. Mr. Mattacchione is the Company’s Chairman of the Board and
Chief Executive Officer.

 

(7)Represents
(i) 178,555 shares owned by Mr. Oliva, and (ii) 194,800 shares that may be acquired upon
exercise of vested options held by Mr. Oliva. Mr. Oliva is a member of the Company’s
Board of Directors.

 

PLAN
OF DISTRIBUTION

 

The
purpose of this reoffer prospectus is to allow the selling stockholders to offer for sale and sell all or a portion of his or
her shares acquired in connection with the provision of certain services to the Company. The selling stockholders may sell the
shares of common stock registered pursuant to this reoffer prospectus directly to purchasers or through broker-dealers or agents,
who may receive compensation in the form of discounts, concessions or commissions from the selling stockholders or the purchasers.
These commissions as to any particular broker-dealer or agent may be in excess of those customary in the types of transactions
involved. Neither we nor the selling stockholders can presently estimate the amount of this compensation.

 

The
common stock offered under this reoffer prospectus may be sold in one or more transactions at fixed prices, at prevailing market
prices at the time of sale, at prices related to the prevailing market prices, at varying prices determined at the time of sale,
or at negotiated prices. These sales may be effected in transactions, which may involve block transactions, on any national securities
exchange on which the Company’s common stock may be then-listed.

 

The
aggregate proceeds to a selling stockholder from the sale of shares will be the purchase price of the common stock less discounts
and commissions, if any. The selling stockholders reserve the right to accept and, together with their agents from time to time,
to reject, in whole or in part, any proposed purchase of the shares to be made directly or through agents. We will not receive
any of the proceeds from a sale of the shares by the selling stockholders. To the extent the options are exercised for cash, if
at all, we will receive the exercise price for the options.

 

The
selling stockholders and any broker-dealers or agents that participate in the sale of the shares may be deemed to be “underwriters”
within the meaning of Section 2(11) of the Securities Act. Any discounts, commissions, concessions or profit they earn on any
resale of the shares may be underwriting discounts and commissions under the Securities Act. If the selling stockholders are “underwriters”
under the Securities Act, the selling stockholders will be subject to the prospectus delivery requirements of the Securities Act.

 

The
shares to be offered or resold by means of this reoffer prospectus by the selling stockholders may not exceed, with respect to
any selling stockholder, during any three-month period, the amount specified in Rule 144(e) under the Securities Act. In addition,
any securities covered by this reoffer prospectus which qualify for sale pursuant to Rule 144 of the Securities Act may be sold
under Rule 144 of the Securities Act rather than pursuant to this reoffer prospectus.

 

LEGAL
MATTERS

 

The
validity of the shares of common stock offered pursuant to this prospectus will be passed upon by Anthony L.G., PLLC.

 

 

EXPERTS

 

The
consolidated financial statements of Novo as of and for the fiscal year ended August 31, 2020 incorporated in this prospectus
by reference from the Company’s Annual Report on Form 10-K for the fiscal year ended August 31, 2020, filed with the SEC
on December 9, 2020, have been audited by SRCO Professional Corporation (“SRCO”), an independent registered public
accounting firm, as stated in SRCO’s report, which is incorporated herein by reference, and has been so incorporated in
reliance upon SRCO’s report given upon its authority as experts in accounting and auditing.

 

The
consolidated financial statements of Novo as of and for the fiscal year ended August 31, 2019 incorporated in this prospectus
by reference from the Company’s Annual Report on Form 10-K for the fiscal year ended August 31, 2020, filed with the SEC
on December 9, 2020, have been audited by NVS Professional Corporation (previously called NVS Chartered Accountants Professional
Corporation) (“NVS”), an independent registered public accounting firm, as stated in NVS’ report, which is incorporated
herein by reference, and has been so incorporated in reliance upon NVS’ report given upon its authority as experts in accounting
and auditing.

 

Anthony
L.G., PLLC will pass upon the validity of the shares of common stock offered pursuant to this prospectus.

 

INDEMNIFICATION
OF OFFICERS AND DIRECTORS

 

Our
articles of incorporation, as amended, provide for the indemnification of our officers and directors to the fullest extent permitted
by the laws of the State of Nevada and may, if and to the extent authorized by our board of directors, so indemnify our officers
and any other person whom we have the power to indemnify against liability, reasonable expense or other matter. This indemnification
policy could result in substantial expenditure by us, which we may be unable to recoup.

 

Our
articles of incorporation, as amended, provide that none of our directors or officers shall be personally liable to us or our
shareholders for monetary damages for a breach of fiduciary duty as a director or officer provided, however, that the foregoing
provisions shall not eliminate or limit the liability of a director or officer for acts or omissions which involve intentional
misconduct, fraud or knowing violation of law, or the unlawful payment of dividends. Limitations on liability provided for in
our articles of incorporation, as amended, do not restrict the availability of non-monetary remedies and do not affect a director’s
responsibility under any other law, such as the federal securities laws or state or federal environmental laws.

 

We
believe that these provisions will assist us in attracting and retaining qualified individuals to serve as executive officers
and directors. The inclusion of these provisions in our articles of incorporation, as amended, may have the effect of reducing
a likelihood of derivative litigation against our directors and may discourage or deter shareholders or management from bringing
a lawsuit against directors for breach of their duty of care, even though such an action, if successful, might otherwise have
benefited us or our shareholders.

 

Insofar
as indemnification by us for liabilities arising under the Exchange Act may be permitted to our directors, officers and controlling
persons pursuant to provisions of the articles of incorporation, as amended, and amended and restated bylaws, or otherwise, we
have been advised that in the opinion of the SEC, such indemnification is against public policy and is, therefore, unenforceable.
In the event that a claim for indemnification by such director, officer or controlling person of us in the successful defense
of any action, suit or proceeding is asserted by such director, officer or controlling person in connection with the securities
being offered, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification by us is against public policy as expressed in the
Exchange Act and will be governed by the final adjudication of such issue.

 

At
the present time, there is no pending litigation or proceeding involving a director, officer, employee or other agent of ours
in which indemnification would be required or permitted. We are not aware of any threatened litigation or proceeding which may
result in a claim for such indemnification.

 

 

WHERE
YOU CAN FIND ADDITIONAL INFORMATION

 

We
file Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K with the SEC in order to meet
our timely and continuous disclosure requirements. We may also file additional documents with the SEC if they become necessary
in the course of the Company’s operations. All such filings are available at the SEC Public Reference Room at 100 F Street,
N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the Public Reference Room. Our
filings are also available free of charge at the website of the SEC at http://www.sec.gov. A copy of any document incorporated
by reference into the registration statement of which this reoffer prospectus forms a part but which is not delivered with this
reoffer prospectus will be provided by us without charge to any person to whom this reoffer prospectus has been delivered upon
oral or written request to that person. Requests for such documents should be directed to our Corporate Secretary, c/o Novo Integrated
Sciences, Inc., Novo Integrated Sciences, Inc., 11120 NE 2nd Street, Suite 100, Bellevue, WA 98004, telephone number (206) 617-9797.

 

INCORPORATION
OF CERTAIN DOCUMENTS BY REFERENCE

 

Except
to the extent any information therein is deemed furnished and not filed pursuant to securities laws and regulations, the Company
hereby incorporates by reference into the registration statement of which this reoffer prospectus forms a part the following documents:

 

 

The
Company’s Annual Report on Form 10-K for the fiscal year ended August 31, 2020, filed with the SEC on December 9, 2020;
 

The
Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended November 30, 2020, filed with the SEC on January
13, 2021;
 

The
Company’s Current Reports on Form 8-K filed on November 13, 2020, November 30, 2020, December 21, 2020, January 28,
2021, February 1, 2021 and February 16, 2020; and
 

The
description of the Company’s securities contained in the Company’s Offering Circular dated June 29, 2020 (File
No. 024-11186), filed with the SEC pursuant to Rule 253(g)(3) promulgated under the Securities Act on June 30, 2020, including
any amendments or reports filed for the purpose of updating such description.

 

All
documents filed by the Company pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act and all reports on Form 8-K
subsequent to the date hereof and prior to the filing of a post-effective amendment to this registration statement that indicates
that all securities offered have been sold or that deregisters all securities then remaining unsold, shall be deemed also to be
incorporated by reference herein and to be a part hereof from the dates of filing of such documents; provided, however,
that, to the extent any information therein is deemed furnished and not filed pursuant to securities laws and regulations,
such information shall not be deemed incorporated by reference into the registration statement of which this prospectus forms
a part.

 

Any
statement contained in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified
or superseded for purposes of this registration statement to the extent that a statement contained herein or in any other subsequently
filed document which is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any statement
so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of the registration statement
of which this prospectus forms a part.

 

 

1,772,000
Shares

NOVO
INTEGRATED SCIENCES, INC.

Common
Stock

 

 

Reoffer
Prospectus

 

 

February
19, 2021

 

 

PART
II

 

INFORMATION
REQUIRED IN THE REGISTRATION STATEMENT

 

Item
3. Incorporation of Documents by Reference.

 

Except
to the extent any information therein is deemed furnished and not filed pursuant to securities laws and regulations, Novo Integrated
Sciences, Inc. (the “Company”) hereby incorporates by reference into the registration statement of which this reoffer
prospectus forms a part the following documents:

 

 

The
Company’s Annual Report on Form 10-K for the fiscal year ended August 31, 2020, filed with the Securities and Exchange
Commission (the “SEC”) on December 9, 2020;
 

The
Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended November 30, 2020, filed with the SEC on January
13, 2021;
 

The
Company’s Current Reports on Form 8-K filed on November 13, 2020, November 30, 2020, December 21, 2020, January 28,
2021, February 1, 2021 and February 16, 2020; and
 

The
description of the Company’s securities contained in the Company’s Offering Circular dated June 29, 2020 (File
No. 024-11186), filed with the SEC pursuant to Rule 253(g)(3) promulgated under the Securities Act of 1933, as amended (the
“Securities Act”) on June 30, 2020, including any amendments or reports filed for the purpose of updating such
description.

 

All
documents filed by the Company pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”), and all reports on Form 8-K subsequent to the date hereof and prior to the filing of a post-effective
amendment to this registration statement that indicates that all securities offered have been sold or that deregisters all securities
then remaining unsold, shall be deemed also to be incorporated by reference herein and to be a part hereof from the dates of filing
of such documents; provided, however, that, to the extent any information therein is deemed furnished and not filed
pursuant to securities laws and regulations, such information shall not be deemed incorporated by reference into the registration
statement of which this prospectus forms a part.

 

Any
statement contained in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified
or superseded for purposes of this registration statement to the extent that a statement contained herein or in any other subsequently
filed document which is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any statement
so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of the registration statement
of which this prospectus forms a part.

 

Item
4. Description of Securities.

 

Not
applicable.

 

Item
5. Interests of Named Experts and Counsel.

 

The
consolidated financial statements of Novo as of and for the fiscal year ended August 31, 2020 incorporated in this prospectus
by reference from the Company’s Annual Report on Form 10-K for the fiscal year ended August 31, 2020, filed with the SEC
on December 9, 2020, have been audited by SRCO Professional Corporation (“SRCO”), an independent registered public
accounting firm, as stated in SRCO’s report, which is incorporated herein by reference, and has been so incorporated in
reliance upon SRCO’s report given upon its authority as experts in accounting and auditing.

 

The
consolidated financial statements of Novo as of and for the fiscal year ended August 31, 2019 incorporated in this prospectus
by reference from the Company’s Annual Report on Form 10-K for the fiscal year ended August 31, 2020, filed with the SEC
on December 9, 2020, have been audited by NVS Professional Corporation (previously called NVS Chartered Accountants Professional
Corporation) (“NVS”), an independent registered public accounting firm, as stated in NVS’ report, which is incorporated
herein by reference, and has been so incorporated in reliance upon NVS’ report given upon its authority as experts in accounting
and auditing.

 

Anthony
L.G., PLLC will pass upon the validity of the shares of common stock offered pursuant to this prospectus.

 

 

Item
6. Indemnification of Directors and Officers.

 

Our
articles of incorporation, as amended, provide for the indemnification of our officers and directors to the fullest extent permitted
by the laws of the State of Nevada and may, if and to the extent authorized by our board of directors, so indemnify our officers
and any other person whom we have the power to indemnify against liability, reasonable expense or other matter. This indemnification
policy could result in substantial expenditure by us, which we may be unable to recoup.

 

Our
articles of incorporation, as amended, provide that none of our directors or officers shall be personally liable to us or our
shareholders for monetary damages for a breach of fiduciary duty as a director or officer provided, however, that the foregoing
provisions shall not eliminate or limit the liability of a director or officer for acts or omissions which involve intentional
misconduct, fraud or knowing violation of law, or the unlawful payment of dividends. Limitations on liability provided for in
our articles of incorporation, as amended, do not restrict the availability of non-monetary remedies and do not affect a director’s
responsibility under any other law, such as the federal securities laws or state or federal environmental laws.

 

We
believe that these provisions will assist us in attracting and retaining qualified individuals to serve as executive officers
and directors. The inclusion of these provisions in our articles of incorporation, as amended, may have the effect of reducing
a likelihood of derivative litigation against our directors and may discourage or deter shareholders or management from bringing
a lawsuit against directors for breach of their duty of care, even though such an action, if successful, might otherwise have
benefited us or our shareholders.

 

Insofar
as indemnification by us for liabilities arising under the Exchange Act may be permitted to our directors, officers and controlling
persons pursuant to provisions of the articles of incorporation, as amended, and amended and restated bylaws, or otherwise, we
have been advised that in the opinion of the SEC, such indemnification is against public policy and is, therefore, unenforceable.
In the event that a claim for indemnification by such director, officer or controlling person of us in the successful defense
of any action, suit or proceeding is asserted by such director, officer or controlling person in connection with the securities
being offered, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification by us is against public policy as expressed in the
Exchange Act and will be governed by the final adjudication of such issue.

 

At
the present time, there is no pending litigation or proceeding involving a director, officer, employee or other agent of ours
in which indemnification would be required or permitted. We are not aware of any threatened litigation or proceeding which may
result in a claim for such indemnification.

 

Item
7. Exemption from Registration Claimed.

 

The
shares being registered pursuant to the reoffer prospectus included herein were issued to the selling stockholders in transactions
exempt from registration under the Securities Act, in reliance on Section 4(a)(2) of the Securities Act, as transactions by an
issuer not involving a public offering. Each of the selling stockholders represented his or her intention to acquire the securities
for investment only and not with a view to or for sale in connection with any distribution thereof, and appropriate legends were
affixed to the share certificates and instruments issued in such transactions. Each selling stockholder had adequate access, through
his or her relationship with the registrant, to information about the registrant.

 

Item
8. Exhibits.

 

 

 

Exhibit
Number

 
Description
of Document
 
 
 3.3
 
Termination of Amendment filed by the registrant with the Nevada Secretary of State on November 23, 2020 (incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K filed with the Commission on November 30, 2020). 
 
 3.4
 
Certificate of Amendment filed by the registrant with the Nevada Secretary of State on November 23, 2020 (incorporated by reference to Exhibit 3.3 to the Company’s Current Report on Form 8-K filed with the Commission on November 30, 2020). 
 
 3.5
 
Termination of Amendment filed by the registrant with the Nevada Secretary of State on December 4, 2020 (incorporated by reference to Exhibit 3.5 to the Company’s Annual Report on Form 10-K filed with the Commission on December 9, 2020). 
 
 3.6
 
Certificate of Amendment filed by the registrant with the Nevada Secretary of State on December 4, 2020 (incorporated by reference to Exhibit 3.6 to the Company’s Annual Report on Form 10-K filed with the Commission on December 9, 2020). 
 
 3.7
 
Bylaws dated February 15, 2008 (incorporated by reference to Exhibit 3.10 to the Company’s Annual Report on Form 10-K filed with the Commission on March 7, 2017). 
 
 4.1
 
Guaranty Agreement dated September 24, 2019 by and between the registrant, Fitness International, LLC and Fitness & Sports Clubs, LLC (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed with the Commission on September 30, 2019). 
 
 4.2
 
Guaranty Agreement dated September 24, 2019 by and between the registrant and LAF Canada Company (incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K filed with the Commission on September 30, 2019). 
 
 5.1*
 
Opinion of the Law Office of Anthony L.G., PLLC. 
 
 10.1+
 
Employment Agreement, entered into on July 12, 2017 and effective July 1, 2017, between the registrant and Christopher David (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on July 18, 2017). 
 
 10.2+
 
2015 Incentive Compensation Plan (incorporated by reference to Exhibit 10.1 to the Company’s registration statement on Form S-8 filed with the Commission on September 8, 2015). 
 
 10.3
 
Share Exchange Agreement dated April 25, 2017 by and between Turbine Truck Engines, Inc., Novo Healthnet Limited, ALMC-ASAP Holdings Inc., Michael Gaynor Family Trust, 1218814 Ontario Inc. and Michael Gaynor Physiotherapy Professional Corp. (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on May 1, 2017). 
 
 10.4
 
Amendment No. 1 to Share Exchange Agreement dated as of May 3, 2017 by and between Turbine Truck Engines, Inc., Novo Healthnet Limited, ALMC-ASAP Holdings Inc., Michael Gaynor Family Trust, 1218814 Ontario Inc. and Michael Gaynor Physiotherapy Professional Corp. (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on May 9, 2017). 
 
 10.5+
 
Option to Purchase Common Stock, dated July 12, 2017 (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed with the Commission on July 18, 2017). 
 
 10.6+
 
Employment Agreement entered into on December 29, 2017 and effective January 1, 2018, between the registrant and Christopher David (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on January 3, 2018).  
 
 10.7+
 
Option to Purchase Common Stock dated December 29, 2017 (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed with the Commission on January 3, 2018).

 

 

Exhibit
Number

 
Description
of Document
 
 
 10.8+
 
Novo Integrated Sciences, Inc. 2018 Incentive Plan (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on January 22, 2018). 
 
 10.9+
 
Amendment to Option #21 of Christopher David dated as of April 20, 2018 (incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed with the Commission on April 24, 2018). 
 
 10.10+
 
Amendment to Option #23 of Christopher David dated as of April 20, 2018 (incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K filed with the Commission on April 24, 2018). 
 
 10.11+
 
Amendment to Option #24 of Christopher David dated as of April 20, 2018 (incorporated by reference to Exhibit 10.5 to the Company’s Current Report on Form 8-K filed with the Commission on April 24, 2018). 
 
 10.12+
 
Amendment No. 1 to Employment Agreement dated July 27, 2018 by and between the registrant and Christopher David (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on July 27, 2018). 
 
 10.13+
 
Employment Agreement, entered into on November 30, 2018 and effective December 1, 2018, between Christopher David and the Company (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on December 6, 2018). 
 
 10.14
 
Agreement of Transfer and Assignment dated January 8, 2019 by and between the registrant and 2478659 Ontario Ltd. (incorporated by reference to Exhibit 10.7 to the Company’s Quarterly Report on Form 10-Q filed with the Commission on January 11, 2019). 
 
 10.15
 
Software License Agreement dated February 26, 2019 by and among Novo Integrated Sciences, Inc., Novo Healthnet Limited and Cloud DX Inc. (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on March 5, 2019). 
 
 10.16
 
First Amendment to Cloud DX Perpetual Software License Agreement dated March 6, 2020 and entered into on March 9, 2020 by and among the registrant, Novo Healthnet Limited and Cloud DX Inc. (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on March 12, 2020). 
 
 10.17
 
Proposal for Joint Venture dated September 11, 2019 between the registrant and Harvest Gold Farms, Inc. (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on September 17, 2019). 
 
 10.18
 
Master Facility License Agreement dated September 24, 2019 by and between Novomerica Health Group Inc., Fitness International, LLC, and Fitness & Sports Clubs, LLC (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on September 30, 2019).  
 
 10.19
 
Amendment to Master Facility License Agreement, entered into as of February 4, 2020, by and between Fitness International, LLC and Novomerica Health Group, Inc. (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on February 10, 2020). 
 
 10.20
 
Master Facility License Agreement dated September 24, 2019 by and between Novo Healthnet Limited, Inc. and LAF Canada Company (incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed with the Commission on September 30, 2019). 
 
 10.21
 
First Amendment to Master Facility License Agreement, entered into as of February 4, 2020, by and between LAF Canada Company and Novo Health Limited, Inc. (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed with the Commission on February 10, 2020).

 

 

Exhibit
Number

 
Description
of Document
 
 
 10.22+
 
Employment Agreement dated August 6, 2020 between the registrant and Christopher David (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on August 12, 2020). 
 
 10.23+
 
Option Agreement #32 of Christopher David dated August 6, 2020. (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed with the Commission on August 12, 2020). 
 
 10.24+
 
Novo Integrated Sciences, Inc. 2018 Incentive Plan (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on January 22, 2018). 
 
 10.25+
 
Novo Integrated Sciences, Inc. 2021 Equity Incentive Plan (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on February 16, 2021). 
 
 23.1*
 
Consent of SRCO Professional Corporation, Independent Registered Public Accounting Firm. 
 
 23.2*
 
Consent of NVS Corporation, Independent Registered Public Accounting Firm. 
 
 23.3*
 
Consent of the Law Office of Anthony L.G., PLLC (incorporated in Exhibit 5.1). 
 
 24.1*
 
Power of Attorney (included on signature page to Form S-8).

 

*
Filed
herewith.
+
Management
contract or compensatory plan or arrangement.

 

Item
9. Undertakings.

 

(a)
The
undersigned Registrant hereby undertakes:

 

 
(1)
To
file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement:

 

(i)
To include any prospectus required by Section 10(a)(3) of the Securities Act;

 

(ii)
To reflect in the prospectus any facts or events arising after the effective date of this Registration Statement (or the most
recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information
set forth in this Registration Statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered
(if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or
high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant
to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate
offering price set forth in the “Calculation of Registration Fee” table in the effective Registration Statement; and

 

(iii)
To include any material information with respect to the plan of distribution not previously disclosed in this Registration Statement
or any material change to such information in this Registration Statement; provided, however, that paragraphs (a)(1)(i)
and (a)(1)(ii) of this section do not apply if the information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the Commission by the Registrant pursuant to Section 13
or 15(d) of the Exchange Act that are incorporated by reference in this Registration Statement.

 

 

 
(2)
That,
for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
 
 
  
(3)
To
remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold
at the termination of the offering.

 

(b)
The
undersigned Registrant hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing
of the Registrant’s annual report pursuant to Section 13(a) or 15(d) of the Exchange Act (and, where applicable, each
filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Exchange Act), that is incorporated
by reference in this Registration Statement shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
 
 (c)
Insofar
as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the
opinion of the Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant
of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities
being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final adjudication of such issue.

 

 

SIGNATURES

 

Pursuant
to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it
meets all the requirements for filing on Form S-8 and has duly caused this Registration Statement to be signed on its behalf by
the undersigned, thereunto duly authorized, in the City of Bellevue, State of Washington, on February 19, 2021.

 

 
NOVO
INTEGRATED SCIENCES, INC.
 
 
  
By:
/s/
Robert Mattacchione
 
 
Robert
Mattacchione
 
 
Chief
Executive Officer

 

POWER
OF ATTORNEY

 

KNOW
ALL PERSONS BY THESE PRESENTS that each person whose signature appears below hereby constitutes and appoints Robert Mattacchione,
his or her true and lawful attorney-in-fact and agent with full power of substitution and resubstitution, for him or her and in
his or her name, place and stead, in any and all capacities, to sign any and all amendments, including post-effective amendments,
to this Registration Statement (any of which amendments may make such changes and additions to this Registration Statement as
such attorney-in-fact may deem necessary or appropriate) and to file the same, with all exhibits thereto, and any other documents
that may be required in connection therewith, granted unto said attorney-in-fact and agent full power and authority to be done
in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent, or his substitute, may lawfully do or cause to be done by virtue hereof.

 

Pursuant
to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.

 

Signature
 
Title
 
Date 
 
 
 
 /s/
Robert Mattacchione

 
Chairman
of the Board and Chief Executive Officer

 
February
19, 2021
Robert
Mattacchione

 
(principal
executive officer)

 
  
 
 
 
 /s/
Thomas Bray

 
Principal
Financial Officer

 
February
19, 2021
Thomas
Bray

 
(principal
financial officer and principal accounting officer)

 
  
 
 
 
 /s/
Pierre Dalcourt

 
Director
 
February
19, 2021
Pierre
Dalcourt

 
 
 
  
 
 
 
 /s/
Christopher David

 
President
and Director

 
February
19, 2021
Christopher
David

 
 
 
  
 
 
 
 /s/
Alex Flesias

 
Director
 
February
19, 2021
Alex
Flesias

 
 
 
  
 
 
 
 /s/
Michael Gaynor

 
Director
 
February
19, 2021
Michael
Gaynor

 
 
 
  
 
 
 
 /s/
Robert Oliva

 
Director
 
February
19, 2021
Robert
Oliva

 
 
 
  
 
 
 
 /s/
Michael Pope

 
Director
 
February
19, 2021
Michael
Pope

 
 
 
 

 

 

 

Exhibit
5.1

 

ANTHONY
L.G., PLLC

 

laura
aNTHONy, esq

GEOFFREY
ASHBURNE, ESQ*

JOHN
CACOMANOLIS, ESQ**

CHAD
FRIEND, ESQ, LLM

SVETLANA
ROVENSKAYA, ESQ***

www.ANTHONYPLLC.com

WWW.SECURITIESLAWBLOG.COM

WWW.LAWCAST.COM

 

DIRECT
E-MAIL: LANTHONY@ANTHONYPLLC.COM

 
 

 

OF
COUNSEL:

MICHAEL
R. GEROE, ESQ, CIPP/US****

CRAIG
D. LINDER, ESQ*****

PETER
P. LINDLEY, ESQ, CPA, MBA

STUART
REED, ESQ

MARC
S. WOOLF, ESQ

 

*licensed
in CA

**licensed
in FL and NY

***licensed
in NY and NJ

****licensed
in CA, DC, MO and NY

*****licensed
in CA, FL and NY

 

February
19, 2021

 

Novo
Integrated Sciences, Inc.

11120
NE 2nd Street, Suite 100

Bellevue,
WA 98004

 

Ladies
and Gentlemen:

 

We
have acted as counsel for Novo Integrated Sciences, Inc., a Nevada corporation (the “Company”), in connection with
the registration statement on Form S-8 (the “Registration Statement”), filed by the Company with the Securities and
Exchange Commission (the “Commission”) under the Securities Act of 1933, as amended (the “Securities Act”),
on the date hereof relating to (i) 4,500,000 shares (the “Plan Shares”) of the Company’s common stock,
par value $0.001 per share (“Common Stock”), issuable pursuant to the Novo Integrated Sciences, Inc. 2021 Equity Incentive
Plan (the “Plan”), and (ii) the resale of 1,772,000 shares (the “Resale Shares” and together with the
Plan Shares, the “Shares”)) of Common Stock underlying stock options previously granted, pursuant to written stock
option agreements, to the selling stockholders named in the Registration Statement.

 

In
that connection, we have examined originals, or copies certified or otherwise identified to our satisfaction, of such documents,
corporate records and other instruments as we have deemed necessary or appropriate for the purposes of this opinion, including,
without limitation: (a) Amended and Restated Articles of Incorporation, as amended, of the Company; (b) the Bylaws of the Company;
(c) certain resolutions adopted by the Board of Directors of the Company and (d) the Plan.

 

In
rendering our opinion, we have assumed the genuineness of all signatures, the legal capacity and competency of all natural persons,
the authenticity of all documents submitted to us as originals and the conformity to authentic original documents of all documents
submitted to us as duplicates or copies. As to all questions of fact material to this opinion that have not been independently
established, we have relied upon certificates or comparable documents of officers and representatives of the Company.

 

Based
on the foregoing and in reliance thereon, and subject to compliance with applicable state securities laws, we are of the opinion
that the Shares will be, when sold in the manner described in the Registration Statement, validly issued, fully paid and non-assessable.

 

Our
opinion expressed herein is limited to the internal laws of the State of Nevada and the federal laws of the United States, and
we do not express any opinion herein concerning any other law.

 

We
hereby consent to the filing of this opinion with the Commission as Exhibit 5.1 to the Registration Statement. In giving this
consent, we do not hereby admit that we are within the category of persons whose consent is required under Section 7 of the Securities
Act or the rules and regulations of the Commission promulgated thereunder.

 

 
Sincerely yours, 
  
/s/ Anthony L.G., PLLC

 

 

Exhibit
23.1

 

 

CONSENT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

We
hereby consent to the incorporation by reference in the Registration Statements on Form S-8 of Novo Integrated Sciences, Inc.
of our report dated December 9, 2020, relating to the consolidated financial statements, which appears in Novo Integrated Sciences,
Inc.’s Annual Report on Form 10-K as filed with the Securities and Exchange Commission on December 9, 2020.

 

 
/s/
SRCO Professional Corporation
 
 

 

Richmond
Hill, Ontario, Canada

February
19, 2021

CHARTERED
PROFESSIONAL ACCOUNTANTS

Authorized
to practice public accounting by the

Chartered
Professional Accountants of Ontario

 

 

Exhibit 23.2

 

 



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