UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington,
D.C. 20549 FORM 10-K



[X] ANNUAL REPORT
UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



For the fiscal year ended: December
31, 2015



or



[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934



For the transition period from _________to ___________



Commission file number: 000-15078



GreeneStone Healthcare Corporation

(Exact name of registrant as
specified in its charter)



Colorado	84-1227328

(State or other jurisdiction
of incorporation or organization)

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



5734 Yonge
Street, Suite 300

North York, Ontario, Canada M2M 4E7

(Address of principal executive offices)



(416) 222-5501

(Registrant’s telephone
number, including area code)



Securities registered under Section
12(b) of the Exchange Act:



|Title of each class registered |  | Name of each exchange on which registered
|------------------------------ |  | -----------------------------------------
|None                           |  | N/A                                      



Securities registered under
Section 12(g) of the Act:



Common Stock, $0.01 par value per share

(Title of class)



Indicate by check mark if the registrant is a well known seasoned issuer, as
defined in Rule 405 of the Securities Act. Yes [ ] No [X] Indicate by check mark if the registrant is not required to file
reports pursuant to Section 13 or Section 15(d) of the Act. Yes [ ] No [X]



Indicate by check mark whether the registrant: (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter
period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the
last 90 days. Yes[X] No [ ]











Indicate by check mark whether
the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required
to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months
(or for such shorter period that the registrant was required to submit and post such files). Yes [X] No [ ]



Indicate by check mark if
disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein,
and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated
by reference in Part III of this Form 10-K or any amendment to this  Form 10-K. [ ]



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



|Large accelerated filer | [ ] | Accelerated filer         | [ ]
|----------------------- | --- | ------------------------- | ---
|Non-accelerated filer   | [ ] | Smaller reporting company | [X]



Indicate by check mark whether the registrant is a
shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X]



The aggregate market value of the voting and nonvoting common equity held by non-affiliates
of the registrant on June 30, 2015, based on a closing price of $0.03 was approximately $1,226,511. As of April 10, 2015, the
registrant had 47,738,855 shares of its common stock, par value $0.01 per share, outstanding.











GREENESTONE HEALTHCARE CORPORATION



YEAR ENDED DECEMBER 31, 2015



TABLE OF CONTENTS



|           |  |                                                                                                             | Page
|---------- |  | ----------------------------------------------------------------------------------------------------------- | ----
|PART I.    |  |                                                                                                             |     
|Item 1.    |  | Business                                                                                                    | 1   
|Item 1A.   |  | Risk Factors                                                                                                | 3   
|Item 1B.   |  | Unresolved Staff Comments                                                                                   | 4   
|Item 2.    |  | Properties                                                                                                  | 4   
|Item 3.    |  | Legal Proceedings                                                                                           | 4   
|Item 4.    |  | Mine Safety Disclosures                                                                                     | 4   
|           |  |                                                                                                             |     
|PART II.   |  |                                                                                                             |     
|Item 5.    |  | Market for Registrant’s Common Equity Related Stockholder Matters and Issuer Purchases of Equity Securities | 5   
|Item 6.    |  | Selected Financial Data                                                                                     | 7   
|Item 7.    |  | Management’s Discussion and Analysis of Financial Condition and Results of Operations                       | 7   
|Item 8.    |  | Financial Statements and Supplementary Data                                                                 | 10  
|Item 9.    |  | Changes in and Discussions with Accountants on Accounting and Financial Disclosure                          | 35  
|Item 9A.   |  | Controls and Procedures                                                                                     | 35  
|Item 9B.   |  | Other Information                                                                                           | 36  
|           |  |                                                                                                             |     
|PART III   |  |                                                                                                             |     
|Item 10.   |  | Directors, Executive Officers and Corporate Governance                                                      | 36  
|Item 11.   |  | Executive Compensation                                                                                      | 38  
|Item 12.   |  | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters              | 39  
|Item 13.   |  | Certain Relationships and Related Transactions, and Director Independence                                   | 40  
|Item 14.   |  | Principal Accountant Fees and Services                                                                      | 41  
|           |  |                                                                                                             |     
|           |  | PART IV.                                                                                                    |     
|Item 15.   |  | Exhibits and Financial Statement Schedules                                                                  | 43  
|SIGNATURES |  |                                                                                                             | 45  











PART I



Item 1. Business.



Company History



GreeneStone Healthcare
Corporation, a Colorado corporation was incorporated under the laws of the State of Colorado on April 1, 1993 (“Greenestone”
or the “Company”), and is the surviving company of a merger, effective February 1, 1995, between the Company and Nova
Natural Resources Corporation, a Delaware corporation (“Nova Delaware”). The merger was effectuated solely for the
purpose of changing the Company’s domicile from Delaware to Colorado. At all times prior to 2001, the Company was engaged
in the oil and gas exploration business. Nova Delaware was the successor entity to Nova Petroleum Corporation, a Delaware corporation,
and Power Resources Corporation, a Delaware corporation, which merged in 1986 (“the 1986 Merger”). Prior to the 1986
Merger, Nova Petroleum Corporation and Power Resources Corporation had operated since 1979 and 1972, respectively. In 2001, the
Company entered into the electronics business and this business was active in 2001 and 2002, as part of the Torita Group. After
2002, the Company continued with various stages of development in this business until 2010.



Recent Developments



On December 29, 2015 the Company entered into a nonbinding Letter of Intent (the “LOI”)
with Aurora Recovery Centre LP (“ALP” for the purchase of certain assets of ALP. This LOI has expired and the proposed
transaction will not proceed.



In February 2015, the Company
finalized the terms for the acquisition of the property currently leased by the Company. The property, which is the location of
GreeneStone's Muskoka addiction treatment center, encompasses approximately 48,000 square feet of buildings on 43 acres and is
adjacent to Lake Muskoka in Ontario. The property has 11separate buildings, including
five detox suites, 29 residential suites, staff cottages with 13 individual bedrooms, a self-contained fitness center, kitchen and
dining facilities, and several meeting and therapy rooms. Additional facilities include an indoor and outdoor pool, a tennis court,
a volleyball court, a running track and nature trails. As of the date of this annual report, the Company is addressing certain
due diligence items which are being resolved and once the requisite funds have been raised the transaction will be consummated.



The purchase price for the property consists of the following; i) CAD$5,500,000 which
will be funded by a mortgage bond over the property; and ii) the issue of 50,000,000 common shares in the Company, at the market
price of the shares on the date of closing.



Change in Operations



On April 1, 2010, the Company, pursuant to Board of Directors resolution, changed
its principal operations from development stage electronics to healthcare services. On March 29, 2010, the Company entered
into a one year consulting agreement with Greenestone Clinic Inc., a Canadian corporation (“Greenestone Clinic”),
whereby Greenestone Clinic provided consulting services for the Company’s development and operation of medical clinics
in the province of Ontario, Canada. Specifically, Greenestone provided medical and business expertise in the initial startup
of private clinics and technical assistance to ensure that the clinics were in compliance with governmental policy and
procedure requirements as well as any operational requirements. At the time of entering into this consulting
agreement, Greenestone Clinic operated a clinic at the Muskoka property now housing its addiction treatment clinic and
provided endoscopy services that the Company had planned to offer in its first Ontario medical clinic.



Table of Contents1











OnMay 15,2010,theCompany secured a sublease ofspace (which waspreviously theRothbart Pain Clinic) ofapproximately 8,000 sq. ft. to beused
as theCompany’s executiveoffices
and to run an endoscopy clinic,whichwas
subsequently sold.The Company started offering medical services in June 2010,offering
various medical services, includingendoscopy, cardiologyand executivemedicals, which services were subsequently sold as part of the
sale of our subsidiary, 1816191 Ontario (“1816191”) during December 2014.



InMarch 2011,Greenestone Clinic,a formerCompany consultant,
gave upthepremises in Bala, Ontario,previously
leased byGreenestone Clinicand
operated as a private medical resortand also allowed
theCompany to dobusiness usingthe“GreeneStone”
name. The Company, through itswholly ownedsubsidiary
GreeneStone ClinicMuskokaInc.
(“GreeneStone Muskoka”)entered intoa
lease with the owneroftheMuskokapremises onApril 1,
2011.The Company offersonlymental healthand addictiontreatment
services at this location whichoperates as an in-patientaddictiontreatment center.



On December 17, 2014, the
Company completed the sale of all of the outstanding shares of its subsidiary, 1816191, for the sum of CAD$1,282,002, comprised
of the agreed purchase price of CAD$1,250,000 and the acquisition of net assets at closing of CAD$32,002. The sale was made pursuant
to a Share Purchase Agreement, dated October 6, 2014, by and between the Company and Jaintheelal Parekh Medicine Professional Corporation
(“Jaintheelal”). The Company and Jaintheelal entered into a revised Share Purchase Agreement on December 16, 2014.



Jaintheelalis ownedbyDr.Jay Parekh, theCompany’s formerMedical director in charge ofEndoscopy. The sale price of CAD$1,282,002included
theassumption by Jaintheelal of debtin thesame amount as thesale price, whichdebt
was owedby1816191to theCompany in theamount of
CAD$895,496and to Jaintheelal ofCAD$386,542.
Atclosing, Jaintheelaloffsettheassumed debtto theregistrant of
CAD$895,496 by US$277,500 throughthecancellation
of2,408,268 shares oftheCompany’s
common stock,for a net amount dueto theCompany of US$493,807.The remainder oftheassumed debtowedby1816191to theCompany was originallydueto theCompany onJune 30,2015,which duedate was extendedto December
31,2015,thisloanhas notbeen extendedbeyond thisdateas ofthedatehereof, is in theformofan interest bearing note
witha couponof 5%per annum.



The Company’s principal operationsarenow theprovision ofaddictiontreatment services.



Corporate Structure



The Company currently has one, wholly owned,
operating subsidiary, GreeneStone Muskoka.



GreeneStone Muskoka Treatment Center



On February 1, 2011,
Dr.Paul Garfunkel was retained on a six-month consulting contract to advise the Company
on its plan to go into the addiction treatment business. Dr.Garfunkel formed a Clinical
Advisory Group (“CAG”) including himself, Dr.Clive Chamberlain, Dr.Greg Donahue and Janice Harris R.N. The CAG created the
mission and protocols for the addiction treatment business and was tasked to hire a leader for the addiction treatment business.



On April 1, 2011, the
Company through GreeneStone Muskoka, entered into a lease (the “Bala Lease”) with Cranberry Cove Holdings Ltd. (“Cranberry”),
the owner of the Bala, Ontario property (the “Bala Property”) in order to operate a mental health and addiction treatment
center at the property. On April 1, 2011 (the “Purchase Date”), GreeneStone Muskoka purchased all of the assets of
Greenestone Clinic that were previously used for the operation of the executive medical center located at the Bala Property. This
gave GreeneStone Muskoka a turnkey opportunity to start up its addiction treatment business (the “GreeneStone Muskoka Treatment
Center”).



On April 1, 2011, Dr.Susan K. Blank was
hired under a one-year contract to run the GreeneStone Muskoka Treatment Center. Dr.Blank
worked with the CAG to refine the mission and protocols for the GreeneStone Muskoka Treatment Center and worked on the policies
and procedures for the operation of the treatment center.

Table of Contents2









In August 2011, the
GreeneStone Muskoka Treatment Center began providing addiction treatment services and took its first paying clients. The GreeneStone
Muskoka Treatment Center offers clients a 45day program that costs between CAD$27,000 and CAD$37,000 per treatment period. Treatment
is individualized, providing the first two weeks of treatment, with an assessment thereafter and often, a recommendation to extend
treatment. The treatment offered is concurrent, with addiction and co-occurring mental health disorders treated at the same time.
The center has a 36 bed capacity and can easily be expanded beyond that capacity. Treatment consists of group and individual therapy,
as well as recreation therapy. Clients are taught about nutrition and are provided with nutritious food while in treatment.



In November of 2011, the
CAG was disbanded after achieving its goals. In March 2012, Dr. Blank and two contract therapists, all of whom were from the United
States, were replaced by a more permanent team of Canadian doctors and therapists.



Employees



As of December 31, 2015,
GreeneStone Healthcare Corporation had no employees and its subsidiary GreeneStone Clinic Muskoka had approximately 32 employees.



Marketing



The addiction treatment
business operates as a private pay service. The customers get no government or OHIP subsidy to attend our treatment facility.
The decision to attend the treatment center is made by each individual, making it important to market our services to the individual.
There are a large number of mental health professionals that refer to the treatment center and we ensure that we maintain contact
with and market to these professionals. Our marketing efforts are long term processes of establishing relationships with relevant
professionals and our treatment staff. We use industry specific conferences and functions to network with these professionals.



Approximately 70% of our
clients are sourced via the Internet. This is the single biggest focus for our marketing team, Search Engine Optimization (SEO)
is very important and the Company aggressively seeks the maximum cost/benefit relationships with specialist firms in this field.
We believe our marketing efforts are successful and effective.



Competition



The private pay addiction
treatment business is not well established in Canada and there are only a few competitors that provide these services. Two of
the biggest providers are also government hospital licensed facilities, that do both OHIP insured services and privately paid
services. Most hospitals have a mental health unit that can handle detoxification, but do not provide addiction treatment programs.
There is only one large competitor with a similar offering to GreeneStone Muskoka, located on the west coast of Canada. There
are hundreds of private paid facilities in the United States and they collectively, represent a major competitor for those with
the ability to pay for addiction services. Addiction service facilities in the United States that offer the same level of treatment
offered by our Company are generally 50% to 100% more expensive than we are. We believe that travel to the United States by potential
customers with potential travel restrictions as well as the higher cost eliminates many U.S. facilities as competition.



Environmental Regulations



The Company is not currently
subject to any pending administrative or judicial enforcement proceedings arising under environmental laws or regulations. Environmental
laws and regulations may be adopted in the future which may have an impact upon the Company’s operations.



Item 1A. Risk Factors.



Not applicable because we are a smaller reporting company.



Table of Contents3







Item 1B. Unresolved Staff Comments



none.



Item 2. Properties.



Greenestone Executive Offices
and Endoscopy Unit



The Company’s executive
offices are located at 5734 Yonge Street, Suite 300, Toronto, Ontario, Canada M2M 4E7, consisting of approximately 8,000 sq. ft.
and takes up the entire third floor of the building (the “Yonge Street Facility”). This facility was leased by 1816191
and the primary activity at this facility was endoscopy procedures. The Company entered into a sublease for office space at these
premises from 1816191 on a month to month basis.



Greenestone Muskoka Treatment
Facility



The Bala Facility is in Bala,
Ontario at 3571 Highway 169. The property is 43 acres in size and contains approximately 48,000 square feet of buildings. The
property is leased from Cranberry Cove for a term of five years, which commenced on April 1, 2014 and has an option to extend
for an additional three years. Further, the Company has an option to purchase the property at any time during the term of the
lease for $10.0 million dollars and a right of first refusal in the event of a sale to a third party.



Item 3. Legal Proceedings.



We are currently not involved
in any litigation that we believe could have a material adverse effect on our financial condition or results of operations. There
is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory
organization or body pending or, to the knowledge of the executive officers of our company or any of our subsidiaries, threatened
against or affecting our company, our common stock, any of our subsidiaries or of our companies or our subsidiaries’ officers
or directors in their capacities as such, in which an adverse decision could have a material adverse  effect.



Item 4. Mine Safety Disclosures.



None.

Table of Contents4







PART II



Item 5. Market for Registrant’s
Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.



(a) Market Information



The Company’s common
stock is quoted on the Over-the-counter Bulletin Board (the “OTCBB”) under the symbol “GRST”. The Company
was sponsored by the market maker Wilson Davis & Co. from Salt Lake City, Utah, which filed a Form 15c2-11 application with
the Financial Industry Regulatory Authority (“FINRA”) for the Company in 2011. This application was approved by FINRA
in February 2012, and Wilson Davis & Co. first quoted the stock in March 2012.



The following table sets
forth the range of high and low bid quotations for our common stock for each of the periods indicated as reported by the OTCBB.
These quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not necessarily represent
actual transactions.



|Period Ending December 31, 2015
|-------------------------------
|Quarter Ended                  
|                               
|                               
|                               
|                               
|                               
|                               
|                               
|                               
|Period Ending December 31, 2014
|                               
|                               
|                               
|                               
|                               
|                               
|                               
|                               



Quotations on the
OTCBB reflect bid and ask quotations, may reflect inter-dealer prices, without retail markup, markdown or commission and may not
represent actual transactions.



(b) Holders



The number
of record holders of the Company’s common stock as of April 10, 2015, was approximately 149.



(c) Dividends



We have never paid any
cash dividends on our common shares, and we do not anticipate that we will pay any dividends with respect to those securities
in the foreseeable future. Our current business plan is to retain any future earnings to finance the expansion development of
our business.



(d) Securities Authorized for Issuance Under Equity Compensation
Plans



As of December 31, 2015, there were 10,000,000 common securities authorized for issuance
under the Company’s 2013 Stock Option Plan (which was previously approved by security holders).

Table of Contents5







Recent Sales of Unregistered
Securities



In the securities transactions
described below, shares were issued pursuant to the exemptions from the registration requirements of the Securities Act of 1933,
as amended, afforded the Company under Section 4(a)(2) promulgated thereunder due to the fact that the issuance did not involve
a public offering because of the insubstantial number of persons involved in each offering, the size of the offering, manner of
the offering and number of shares offered. Based on an analysis of the above factors, we have met the requirements to qualify
for exemption under Section 4(a) (2) of the Securities Act for these transactions.



The following is a summary of the
securities transactions during the year ended December 31, 2015:



On January 15, 2015 the
Company issued 300,000 shares of the Company’s common stock to JMJ pursuant to the conversion of a convertible note totaling
US$8,117 at a conversion price of US$0.027 per share.



On March 31, 2015, the
Company cancelled 2,909 shares of the Company’s common stock pursuant to a convertible note conversion to recognize the effect
of the currency exchange difference in the note conversion.



On March 31, 2015, the
Company issued 250,000 shares of the Company’s common stock and 106,000 of the Company’s Series B Preferred stock to
Castelli as compensation for services rendered totaling $56,096.



On April 30, 2015, the
Company issued 1,060,000 shares of the Company’ common stock to Castelli upon conversion of the 106,000 Series B Preferred
stock, mentioned above, at a conversion ratio of 10:1.



Penny Stock



The U.S. Securities and
Exchange Commission (the “SEC”) has adopted rules that regulate broker-dealer practices in connection with transactions
in penny stocks. Penny stocks are generally equity securities with a market price of less than $5.00, other than securities registered
on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with
respect to transactions in such securities is provided by the exchange or system. The penny stock rules require a broker-dealer,
prior to a transaction in a penny stock, to deliver a standardized risk disclosure document prepared by the SEC, that: (a) contains
a description of the nature and level of risk in the market for penny stocks in both public offerings and secondary trading; (b)
contains a description of the broker’s or dealer’s duties to the customer and of the rights and remedies available
to the customer with respect to a violation of such duties or other requirements of the securities laws; (c) contains a brief,
clear, narrative description of a dealer market, including bid and ask prices for penny stocks and the significance of the spread
between the bid and ask price; (d) contains a toll-free telephone number for inquiries on disciplinary actions; (e) defines significant
terms in the disclosure document or in the conduct of trading in penny stocks; and (f) contains such other information and is
in such form, including language, type size and format, as the SEC shall require by rule or regulation.



The broker-dealer also must
provide, prior to effecting any transaction in a penny stock, the customer with (a) bid and offer quotations for the penny stock;
(b) the compensation of the broker-dealer and its salesperson in the transaction; (c) the number of shares to which such bid and
ask prices apply, or other comparable information relating to the depth and liquidity of the market for such stock; and (d) a
monthly account statement showing the market value of each penny stock held in the customer’s  account.



In addition, the penny stock
rules require that prior to a transaction in a penny stock not otherwise exempt from those rules, the broker-dealer must make
a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser’s
written acknowledgment of the receipt of a risk disclosure statement, a written agreement as to transactions involving penny stocks,
and a signed and dated copy of a written suitability statement.



These disclosure requirements may have the effect of reducing the trading activity for
our common stock. Therefore, stockholders may have difficulty selling our securities.



Table of Contents6







Item 6. Selected Financial Data.



Not applicable as we are a smaller
reporting company.



Item 7. Management’s Discussion and Analysis of Financial Condition and Results
of Operations.



Forward-Looking Statements



This annual report on Form
10-K and other reports filed by Greenestone Healthcare Corp. (“we,” “us,” “our,” or the “Company”)
from time to time with the SEC contain or may contain forward-looking statements and information that are based upon beliefs of,
and information currently available to, the Company’s management as well as estimates and assumptions made by Company’s
management. Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions
and speak only as of the date hereof. When used in the filings, the words “anticipate,” “believe,” “estimate,”
“expect,” “future,” “intend,” “plan,” or the negative of these terms and similar
expressions as they relate to the Company or the Company’s management identify forward-looking statements. Such statements
reflect the current view of the Company with respect to future events and are subject to risks, uncertainties, assumptions, and
other factors. Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect,
actual results may differ significantly from those anticipated, believed, estimated, expected, intended, or  planned.



Although the Company believes
that the expectations reflected in the forward-looking statements are reasonable, the Company cannot guarantee future results,
levels of activity, performance, or achievements. Except as required by applicable law, including the securities laws of the United
States, the Company does not intend to update any of the forward-looking statements to conform these statements to actual  results.



Our financial statements
are prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). These accounting
principles require us to make certain estimates, judgments, and assumptions. We believe that the estimates, judgments and assumptions
upon which we rely are reasonable based upon information available to us at the time that these estimates, judgments, and assumptions
are made. These estimates, judgments, and assumptions can affect the reported amounts of assets and liabilities as of the date
of the financial statements as well as the reported amounts of revenues and expenses during the periods presented. Our financial
statements would be affected to the extent there are material differences between these estimates. This discussion and analysis
should be read in conjunction with the Company’s financial statements and accompanying notes to the financial statements
for the year ended December 31, 2015.



Plan of Operation



During the next twelve months,
the Company plans to continue and expand its operations as a provider of addiction and after-care treatment services. The Company
plans to focus on the growth of its addiction and aftercare treatment units while simultaneously reducing costs in current operations.



The Company finalized the terms for the acquisition of the property currently
leased by the Company. The property, which is the location of GreeneStone's Muskoka addiction treatment center, encompasses
approximately 48,000 square feet of buildings on 43 acres and is adjacent to Lake Muskoka in Ontario. The Company expects
this deal to close by the second quarter of the 2016 financial year, once the appropriate funding has been raised.



The Company plans to
expand its addiction treatment business with acquisitions. In 2014, the Company entered into a non-binding letter of intent with
Venture Academy to acquire teen addition treatment centers in Ontario and British Columbia. The Company will need to raise additional
capital for this acquisition, which would require the sale of its equity and/or debt securities and securing bank financing.



Results of Operations



For the Fiscal Year Ended December
31, 2015, Compared to the Fiscal Year Ended December 31, 2014



Table of Contents7







Revenue



We had revenues totaling $3,138,878
and $3,416,342 for the years ended December 31, 2015 and 2014, respectively, a decrease of $277,464 or 8.1%. We operate in Canada
and our functional currency is the Canadian Dollar. Our revenue, in Canadian Dollars increased from CAD$3,963,274 to CAD$4,003,090
for the years ended December 31, 2014 and 2015, respectively, an increase of $39,816 or 1.0%. The decrease in revenue in US$ terms
is attributable to the relative strength of the US$ against the CAD$ during the current year, the average exchange rate between
the CAD$ and the US$ has weekend from $0.9051 in the prior year to $0.7833 in the current year, a decrease in the average exchange
rate of 15.5%. The Company believes that revenue will grow over the next year.



Operating Expenses



Operating expenses totaled
$3,409,450 and $4,757,851 for the years ended December 31, 2015 and 2014, respectively, a decrease of $1,348,401 or 28.3%. The
decrease in operating expenses in US$ terms is attributable to the relative strength of the US$ against the CAD$ during the current
year, the average exchange rate between the CAD$ and the US$ has weekend from $0.9051 in the prior year to $0.7833 in the current
year, a decrease in the average exchange rate of 15.5%. The decline in the currency exchange rate accounts for approximately $530,156
of the differential. The non-currency decrease is primarily attributed to a reduction in labor of $903,217 due to a reduction in
labor overhead costs and the cessation of aftercare services and a non-currency decrease in rental expense ofapproximately $91,765 due to a re-negotiation of our rental arrangement at our executive offices.



Operating loss



The operating loss totaled
$270,572 and $1,341,509 for the years ended December 31, 2015 and 2014, respectively, a decrease of $1,070,937, primarily due to
the decline in operating expenses explained above.



Other expense



Other expense of $457,913
consists primarily of the provision of $446,476 raised against the receivable on the sale of the Endoscopy clinic. This receivable
was fully provided for as there were no payments received in accordance with the agreement or any payments received as of the date
hereof.



Interest expense



Interest expense totaled
$192,104 and $310,583 for the years ended December 31, 2015 and 2014, respectively, a decrease of $118,479 or 38.1%. The decline
consists of an approximate decline of $29,871 due to the deterioration in the exchange rate and a reduction in the interest bearing
convertible notes which were carried in the prior year, offset by an increase in interest expense attributable to interest on payroll
and Harmonized Sales Tax(“HST”), and accruals for income taxpenalties.



Foreign exchange movements



Foreign exchange movements of $184,586, represent the realized exchange loss on monetary
assets and liabilities settled during the current year as well as mark to market adjustments on monetary assets and liabilities
reflected on the balance sheet and denominated in Canadian Dollars.



Taxation



A taxation expense of $50,000 was provided for in the current year as an estimate of
potential US taxes to be paid for failure to file required US tax returns in time.

Table of Contents8







Net loss from discontinued
operations



During the prior year, the
Company disposed of its Endoscopy Clinic to a related party. The net loss from discontinued operations amounted to $248,181.



Net Loss



Net loss totaled $1,155,176 and $1,900,273 for the years ended December 31, 2015 and
2014, respectively, a decrease of $745,097, primarily due to the decrease in operating expenses, the sale of the Endoscopy unit
in the prior year and the decline in interest expense, discussed above.



Contingency related to outstanding
payroll tax liabilities:



The Company was delinquent
in filing previous payroll tax returns resulting in taxes, interest and penalties payable at December 31, 2015 and 2014. As of
December 31, 2015 and 2014 as part of Taxes Payable, the Company has payroll tax liabilities of approximately $2,429,032 and $2,065,000,
respectively due to various taxing authorities on the consolidated balance sheets. If the Company does not satisfy these liabilities,
the taxing authorities may place liens on its bank accounts which would have a negative impact on its ability to operate. Further,
the actual liability may be higher due to interest or penalties assessed by the taxing authorities.



Liquidity and Capital Resources



The following table summarizes
working capital at December 31, 2015, compared to December 31, 2014.



|                          |  | December 31, 2015 |            | December 31, 2014 |  | Increase
                                         (Decrease)
|------------------------- |  | ----------------- | ---------- | ----------------- |  | ------------------------------------------------------------
|Current Assets            |  | $                 | 199,245    |                   |  | $                                                           
|Current Liabilities       |  |                   | (3,803,668 | )                 |  |                                                             
|Working Capital (Deficit) |  | $                 | (3,604,423 | )                 |  | $                                                           



Over the next twelve months we estimate that the company will require $3.5million
to cover the working capital deficit and properly market and promote the company. The company will have to raise equity or
secure debt. There is no assurance that the Company will be successful with future financing ventures, and the inability to
secure such financing may have a material adverse effect on the Company’s financial condition. In the opinion of
management, the Company’s liquidity risk is assessed as high and remains unchanged from the prior year.

Table of Contents9





Item 8. Financial Statements and Supplementary Data.



GREENESTONE HEALTHCARE CORPORATION



INDEX TO CONSOLIDATED FINANCIAL
STATEMENTS



(Expressed in US$ unless otherwise
indicated)





|                                                                                                           | PAGE
|---------------------------------------------------------------------------------------------------------- | ----
|Report of Independent Registered Public Accounting Firm                                                    | 11  
|Consolidated Balance Sheets as of December 31, 2015 and 2014                                               | 12  
|Consolidated Statements of Operations for the year ended December 31,
    2015 and 2014                    | 13  
|Consolidated Statements of Changes in Stockholders Deficit for the years ended December 31, 2015 and 2014. | 14  
|Consolidated Statements of Cash Flows for the years ended December 31,
    2015 and 2014                   | 15  
|Notes to the Consolidated Financial Statements                                                             | 17  



Table of Contents10













REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM





To the Board of Directors and Stockholders
ofGreeneStone HealthcareCorporation



Wehave auditedtheaccompanying
consolidated balancesheets ofGreeneStone Healthcare Corporation (“the
Company”) as ofDecember 31, 2015and
2014and therelated consolidatedstatements of operationsand othercomprehensive
loss, stockholders’ deficit and cash flows for theyears endedDecember 31, 2015and 2014.These
consolidatedfinancial statements aretheresponsibility oftheCompany’s
management. Ourresponsibility is to express an opiniononthese consolidatedfinancial statements
based onouraudit.



Weconducted our auditin accordance with
thestandards ofthePublic Company
AccountingOversight Board (United States). Those standards require thatweplanand perform the
auditto obtain reasonable assurance aboutwhether thefinancial statements arefreeofmaterial misstatement. The Company is notrequired to have,norwere weengagedto perform, an auditof itsinternal control overfinancial
reporting. Our audit includedconsideration ofinternal control overfinancial reporting as a basis for designingauditprocedures thatareappropriate in thecircumstances, but notfor thepurpose ofexpressing an opinionontheeffectiveness oftheCompany’s
internal control overfinancial reporting. Accordingly, weexpress nosuch opinion.An
auditalso includesexamining, ona
test basis, evidence supportingtheamounts
and disclosures in thefinancial statements, assessing the
accountingprinciplesused and significant estimates made bymanagement, as wellas evaluating theoverall
financial statement presentation. Webelieve thatour auditprovidesa reasonable basis
for ouropinion.



In our opinion, the consolidated
financial statements referred to above present fairly, in all material respects, the consolidated financial position of GreeneStone
Healthcare Corporation as of December 31, 2015 and 2014 and the results of its operations and its cash flows for the years ended
December 31, 2015 and 2014 in conformity with accounting principles generally accepted in the United States of America.



The accompanying consolidated financial statements have been prepared assuming that
the Company will continue as a going concern. As discussed in Note 3 to the consolidated financial statements, the Company has
sustained net losses and has a working capital and stockholder’s deficit. These conditions raise substantial doubt about
the Company’s ability to continue as a going concern. Management’s plans in regards to these matters are also described
in Note 3. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.









/s/ RBSM LLP

New York, NY

April 14,
2016





Table of Contents11









|GREENESTONE HEALTHCARE CORPORATION                                                                                                                                  
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------
|CONSOLDATED BALANCE SHEETS                                                                                                                                          
|                                                                                                                                                                    
|                                                                                                                                                                    
|ASSETS                                                                                                                                                              
|Current assets                                                                                                                                                      
|Cash                                                                                                                                                                
|Accounts receivable, net                                                                                                                                            
|Prepaid expenses                                                                                                                                                    
|Due on sale of Subsidiary                                                                                                                                           
|Total current assets                                                                                                                                                
|Non-current assets                                                                                                                                                  
|Cash - Restricted                                                                                                                                                   
|Deposits                                                                                                                                                            
|Fixed assets, net                                                                                                                                                   
|Total non-current assets                                                                                                                                            
|Total assets                                                                                                                                                        
|                                                                                                                                                                    
|LIABILITIES AND STOCKHOLDERS' DEFICIT                                                                                                                               
|                                                                                                                                                                    
|Current liabilities                                                                                                                                                 
|Bank overdraft                                                                                                                                                      
|Accounts payable and accrued liabilities                                                                                                                            
|Taxes payable                                                                                                                                                       
|Deferred revenue                                                                                                                                                    
|Current portion of loan payable                                                                                                                                     
|Short-term loan                                                                                                                                                     
|Related party payables                                                                                                                                              
|Total current liabilities                                                                                                                                           
|Non-current liabilities                                                                                                                                             
|Loan payable                                                                                                                                                        
|Total liabilities                                                                                                                                                   
|                                                                                                                                                                    
|Stockholders' deficit                                                                                                                                               
|Preferred stock - Series A; $0.01 par value, 3,000,000 authorized, nil oustanding as of December 31, 2015 and 2014.                                                 
|Preferred Stock - Series B; $0.01 par value, 10,000,000 authorized, nil outstanding as of December 31 2015 and 2014 respectively                                    
|Common stock; $0.01 par value, 500,000,000 shares authorized; 47,738,855 and 46,131,764 shares issued and outstanding  as of December 31, 2015 and 2014 respectively
|Additional paid-in capital                                                                                                                                          
|Accumulated other comprehensive income                                                                                                                              
|Accumulated deficit                                                                                                                                                 
|Total stockholders' deficit                                                                                                                                         
|                                                                                                                                                                    
|Total liabilities and stockholders' deficit                                                                                                                         



The accompanying notes are an integral part of the consolidated financial statements



Table of Contents12







GREENESTONE
HEALTHCARE CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS





|                                                              |  | Year ended December 31, 2015 |            | Year ended December 31, 2014
|------------------------------------------------------------- |  | ---------------------------- | ---------- | ----------------------------
|                                                              |  |                              |            |                             
|Revenues                                                      |  | $                            | 3,138,878  |                             
|                                                              |  |                              |            |                             
|Operating expenses                                            |  |                              |            |                             
|Depreciation and amortization                                 |  |                              | 90,862     |                             
|General  and administrative                                   |  |                              | 940,796    |                             
|Management fees                                               |  |                              | 96,705     |                             
|Professional fees                                             |  |                              | 301,197    |                             
|Rent                                                          |  |                              | 277,563    |                             
|Salaries and wages                                            |  |                              | 1,752,327  |                             
|Total  operating expenses                                     |  |                              | 3,459,450  |                             
|                                                              |  |                              |            |                             
|Operating loss                                                |  |                              | (320,572   | )                           
|                                                              |  |                              |            |                             
|Other expense                                                 |  |                              |            |                             
|Other expense                                                 |  |                              | (457,913   | )                           
|Interest expense                                              |  |                              | (192,104   | )                           
|Foreign  exchange movements                                   |  |                              | (184,586   | )                           
|Net loss before taxation from continuing operations           |  |                              | (1,155,176 | )                           
|Taxation                                                      |  |                              | —          |                             
|Net loss from continuing operations                           |  |                              | (1,155,176 | )                           
|Loss from discontinued operations, net of tax                 |  |                              | —          |                             
|Net loss                                                      |  |                              | (1,155,176 | )                           
|Accumulated  other comprehensive loss                         |  |                              |            |                             
|Foreign  currency  translation adjustment                     |  |                              | 688,639    |                             
|                                                              |  |                              |            |                             
|Total comprehensive loss                                      |  | $                            | (466,537   | )                           
|                                                              |  |                              |            |                             
|Basic and diluted loss per common share continuing  operaions |  | $                            | (0.02      | )                           
|Basic and diluted loss per common share                       |  | $                            | (0.02      | )                           
|                                                              |  |                              |            |                             
|Weighted average common shares  outstanding                   |  |                              | 47,317,928 |                             





The accompanying notes are an integral part of the consolidated financial statements





Table of Contents13







|GREENESTONE HEALTHCARE CORPORATION                                                      
|----------------------------------------------------------------------------------------
|CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIT                                         
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|Balance as of December 31, 2013                                                         
|                                                                                        
|Surrender of shares as part of sale of subsidiary                                       
|Disposition of subsidiary                                                               
|Common stock issued for convertible notes                                               
|Common stock issued for short term note                                                 
|Shares issued for cash                                                                  
|Stock option compensation                                                               
|Beneficial conversion feature of debt issuances                                         
|Foreign currency translation                                                            
|Net loss, year ended December 31, 2014                                                  
|Balance as of December 31, 2014                                                         
|                                                                                        
|Shares issued for debt conversion                                                       
|Shares issued for services                                                              
|Conversion of Sries "B" Preferred shares to common                                      
|Adjustments to previously issued shares for debt conversion, due to exchange adjustments
|Foreign currency translation                                                            
|Net loss, year ended December 31, 2015                                                  
|Balance as of December 31, 2015                                                         



The accompanying notes are an integral part of the consolidated financial statements

Table of Contents14













|GREENESTONE HEALTHCARE CORPORATION                                                          
|--------------------------------------------------------------------------------------------
|CONSOLIDATED STATEMENT OF CASH FLOWS                                                        
|                                                                                            
|Operating activities                                                                        
|Net loss                                                                                    
|Net loss from discontinued operations                                                       
|Net loss from continuing operations                                                         
|Adjustment to reconcile net loss to net cash (used in)
    provided by operating activities:
|Depreciation and amortization                                                               
|Provision for bad debts                                                                     
|Provision against receivable on sale of subsidiary                                          
|Stock issued for services                                                                   
|Other foreign exchange movements                                                            
|Amortization of beneficial conversion feature                                               
|Changes in operating assets and liabilities                                                 
|Accounts receivable                                                                         
|Prepaid expenses                                                                            
|Accounts payable and accrued liabilities                                                    
|Taxes payable                                                                               
|Deferred revenue                                                                            
|Net cash (used in) provided by operating activities - continuing operations                 
|Net cash provided by operating activities - discontinued operations                         
|Net cash (used in) provided by operating activities                                         
|                                                                                            
|Investing activities                                                                        
|Purchase of fixed assets                                                                    
|Movement in deposits                                                                        
|Net cash used in investing activities                                                       
|                                                                                            
|Financing activities                                                                        
|Decrease in restricted cash                                                                 
|Increase (decrease) in bank overdraft                                                       
|Repayment of loan payable                                                                   
|Repayment of notes payable                                                                  
|Proceeds from short-term notes                                                              
|Proceeds from related party notes                                                           
|Repayment of related party notes                                                            
|Proceeds from the sale of common stock                                                      
|Net cash provided by financing activities - continuing operations                           
|Net cash used in financing activities - discontinued operations                             
|Net cash provided by financing activities                                                   
|                                                                                            
|Effect of exchange rate on cash                                                             
|                                                                                            
|Net change in cash                                                                          
|Beginning cash balance                                                                      
|Ending (overdraft) cash balance                                                             
|                                                                                            

Table of Contents15





|                                                              |  |   |        |  |  |   |         | 
|------------------------------------------------------------- |  | - | ------ |  |  | - | ------- | 
|Supplemental cash flow information                            |  |   |        |  |  |   |         | 
|Cash paid for interest                                        |  | $ | 19,202 |  |  | $ | 80,531  | 
|Cash paid for income taxes                                    |  | $ | —      |  |  | $ | —       | 
|                                                              |  |   |        |  |  |   |         | 
|Non cash investing and financing activities                   |  |   |        |  |  |   |         | 
|Common stock issued on conversion of convertible notes        |  | $ | 8,117  |  |  | $ | 197,730 | 
|Common stock issued on conversion of short term notes payable |  | $ | —      |  |  | $ | 127,076 | 
|Common stock surrendered on disposition of subsidiary         |  | $ | —      |  |  | $ | 277,500 | 





The accompanying
notes are an integral part of the consolidated financial statements





Table of Contents16





GREENESTONE HEALTHCARE CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS



1. Nature of Business



GreeneStone Healthcare Corporation (the “Company”) was
incorporated under the laws of the state of Colorado, USA, on April 1, 1993. Effective May 2012, the Company changed its
corporate name to GreeneStone Healthcare Corporation from Nova Natural Resources Corporation. As at December 31, 2015 and 2014,
the Company owns 100% of the outstanding shares of Greenestone Clinic Muskoka Inc., which was incorporated in 2010 under the
laws of the Province of Ontario, Canada. Greenestone Clinic Muskoka Inc. provides medical services to various patients in a
clinic located in the regional municipality of Muskoka.



2. Summary of Significant Accounting Policies



a) Financial Reporting



The Company prepares
its financial statements in conformity with accounting principles generally accepted in the United States of America. Revenues
and expenses are reported on the accrual basis, which means that income is recognized as it is earned and expenses are recognized
as they are incurred.



Management further acknowledges
that it is solely responsible for adopting sound accounting practices, establishing and maintaining a system of internal accounting
control and preventing and detecting fraud. The Company's system of internal accounting control is designed to assure, among other
items, that i) recorded transactions are valid; ii) valid transactions are recorded; and iii) transactions are recorded in the
proper period in a timely manner to produce financial statements which present fairly the financial condition, results of operations
and cash flows of the Company for the respective periods being presented.



b) Use of Estimates



The preparation of financial
statements in conformity with accounting principles generally accepted in the United States of America requires management to
make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting
periods. Actual results could differ from those estimates.



c) Principals of consolidation and foreign currency translation



The accompanying consolidated
financial statements include the accounts of the Company, its subsidiary. All inter-company transactions and balances have been
eliminated on consolidation.



The Company’s subsidiary’s
functional currency is the Canadian dollar, while the Company’s reporting currency is the U.S. dollar. All transactions
initiated in Canadian dollars are translated into US dollars in accordance with ASC 830, “Foreign Currency Translation"
as follows:



|• |  | Monetary assets and liabilities at the rate of exchange in effect at the balance sheet
date.
|- |  | --------------------------------------------------------------------------------------------

|• |  | Equity at historical rates.
|- |  | ---------------------------

|• |  | Revenue and expense items at the average rate of exchange prevailing during the period.
|- |  | ---------------------------------------------------------------------------------------



Adjustments arising from such translations are deferred until realization and are included
as a separate component of stockholders’ deficit as a component of accumulated other comprehensive income or loss. Therefore,
translation adjustments are not included in determining net income (loss) but reported as other comprehensive income (loss).

Table of Contents17









GREENESTONE HEALTHCARE CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS



2. Summary of Significant Accounting Policies (continued)



c) Principals of consolidation and foreign currency translation
(continued)



For foreign currency
transactions, the Company translates these amounts to the Company’s functional currency at the exchange rate effective on
the invoice date. If the exchange rate changes between the time of purchase and the time actual payment is made, a foreign exchange
transaction gain or loss results which is included in determining net income for the period.



The relevant translation
rates are as follows: For the year ended December 31, 2015 a closing rate of CAD$1.0000 equals US$0.72250 and an average exchange
rate of CAD$1.0000 equals US$0.7833 for the year ended December 31, 2015.



d) Revenue Recognition



The Company recognizes revenue
from the rendering of services when they are earned; specifically, when all of the following conditions are met:



|• |  | the significant risks and rewards of ownership are transferred to customers and the
Company retains neither continuing involvement nor effective control;
|- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------

|• |  | there is clear evidence that an arrangement exists;
|- |  | ---------------------------------------------------

|• |  | the amount of revenue and related costs can be measured reliably; and
|- |  | ---------------------------------------------------------------------

|• |  | it is probable that the economic benefits associated with the transaction will flow
to the Company.
|- |  | ---------------------------------------------------------------------------------------------------



In particular, the Company recognizes:



|• |  | Fees for out-patient counselling, coaching, intervention, psychological assessments
and other related services when patients receive the service; and
|- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------

|• |  | Fees for in-patient addiction treatments proportionately over the term of the patient’s
treatment.
|- |  | --------------------------------------------------------------------------------------------------



Deferred revenue represents
monies deposited by the patients for future services to be provided by the Company. Such monies will be recognized into revenue
as the patient progresses through their treatment  term.



e) Non-monetary transactions



The Company’s policy
is to measure an asset exchanged or transferred in a non-monetary transaction at the more reliable measurement of the fair value
of the asset given up and the fair value of the asset received, unless:



|• |  | The transaction lacks commercial substance;
|- |  | -------------------------------------------

|• |  | The transaction is an exchange of a product or property held for sale in the ordinary
course of business for a product or property to be sold in the same line of business to facilitate sales to customers other than
the parties to the exchange;
|- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|• |  | Neither the fair value of the asset received nor the fair value of the asset given
up is reliably measurable; or
|- |  | ----------------------------------------------------------------------------------------------------------------

|• |  | The transaction is a non-monetary, non-reciprocal transfer to owners that represents
a spin-off or other form of restructuring or liquidation.
|- |  | ----------------------------------------------------------------------------------------------------------------------------------------------



Table of Contents18







GREENESTONE HEALTHCARE CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS



2. Summary
                                         of Significant Accounting Policies (continued)



f) Cash and cash equivalents



The Company's policy
is to disclose bank balances under cash, including bank overdrafts with balances that fluctuate frequently from being positive
to overdrawn and term deposits with a maturity period of three months or less from the date of acquisition.



The Company has $72,250
(CAD$100,000) in restricted cash held by their bank to cover against the possibility of credit card charge backs, for services
not performed.



g) Accounts receivable



The Company provides
an allowance for doubtful accounts equal to the estimated uncollectible amounts. The Company's estimate is based on historical
collection experience and a review of the current status of trade accounts receivable. It is reasonably possible that the Company’s
estimate of the allowance for doubtful accounts will change. At December 31, 2015 and December 31, 2014, the Company has a $0
and $27,294 allowance for doubtful accounts, respectively.



h) Financial instruments



The Company initially measures
its financial assets and liabilities at fair value, except for certain non-arm's length transactions. The Company subsequently
measures all its financial assets and financial liabilities at amortized cost.



Financial assets measured at amortized
cost include cash and accounts receivable.



Financial liabilities
measured at amortized cost include bank indebtedness, accounts payable and accrued liabilities, harmonized sales tax payable,
withholding taxes payable, convertible notes payable, loan payable and related party  notes.



Financial assets measured
at cost are tested for impairment when there are indicators of impairment. The amount of the write-down is recognized in net income.
The previously recognized impairment loss may be reversed to the extent of the improvement, directly or by adjusting the allowance
account, provided it is no greater than the amount that would have been reported at the date of the reversal had the impairment
not been recognized previously. The amount of the reversal is recognized in net income. The Company recognizes its transaction
costs in net income in the period incurred. However, financial instruments that will not be subsequently measured at fair value
are adjusted by the transaction costs that are directly attributable to their origination, issuance or assumption.



FASB ASC 820 defines fair
value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles, and expands
disclosures about fair value measurements. ASC 820 establishes a three-tier fair value hierarchy, which prioritizes the inputs
used in measuring fair value as follows:



|• |  | Level 1.	 Observable inputs such as quoted prices in active markets;
|- |  | --------------------------------------------------------------------

|• |  | Level 2. 	Inputs, other than the quoted prices in active markets, that are observable
either directly or indirectly; and
|- |  | ------------------------------------------------------------------------------------------------------------------------

|• |  | Level 3.	Unobservable inputs in which there is little or no market data, which
requires the reporting entity to develop its own assumptions.
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------



The Company does not have assets or liabilities measured at fair value on a
recurring basis at December 31, 2015 and 2014. The Company did not have any fair value adjustments for assets and liabilities
measured at fair value on a non-recurring basis during the year ended December 31, 2015 and 2014.

Table of Contents19





GREENESTONE HEALTHCARE CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS



2. Summary
                                         of Significant Accounting Policies (continued)



i) Plant and equipment



Fixed assets are recorded
at cost. Depreciation is calculated on the declining balance method at the following annual rates:



|Computer Equipment      |  |  | 30  | %
|----------------------- |  |  | --- | -
|Computer Software       |  |  | 100 | %
|Furniture and Equipment |  |  | 30  | %
|Medical Equipment       |  |  | 25  | %
|Vehicles                |  |  | 30  | %



Leasehold improvements are
depreciated using the straight-line method over the term of the lease. Half rates are used for all fixed assets in the year of
acquisition.



j) Leases



Leases are classified as either capital or operating leases. Leases that transfer substantially
all of the benefits and inherent risks of ownership of property to the Company are accounted for as capital leases. At the time
a capital lease is entered into, an asset is recorded together with its related long-term obligation to reflect the acquisition
and financing. Equipment recorded under capital leases is amortized on the same basis as described above. Payments under operating
leases are expensed as incurred.



k) Income taxes



The Company accounts
for income taxes under the provisions of ASC Topic 740, “Income Taxes”. Under ASC Topic 740, deferred tax assets
and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying
amounts of existing assets and liabilities and their respective tax bases. Deferred income taxes are provided using the liability
method. Under this method, deferred income taxes are recognized for the tax consequences of temporary differences by applying
enacted statutory rates applicable to future years to differences between the financial statement carrying amounts and the tax
bases of existing assets and liabilities. The tax basis of an asset or liability is the amount attributed to that asset or liability
for tax purposes. The effect on deferred taxes of a change in tax rates is recognized in income in the period of change. A valuation
allowance is provided to reduce the amount of deferred tax assets if it is considered more likely than not that some portion of,
or all of, the deferred tax assets will not be realized.



ASC Topic 740 contains
a two-step approach to recognizing and measuring uncertain tax positions taken or expected to be taken in a tax return. The first
step is to determine if the weight of available evidence indicates that it is more likely than not that the tax position will
be sustained in an audit, including resolution of any related appeals or litigation processes. The second step is to measure the
tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. The Company recognizes
interest and penalties accrued on unrecognized tax benefits within general and administrative expense. To the extent that accrued
interest and penalties do not ultimately become payable, amounts accrued will be reduced and reflected as a reduction in general
and administrative expenses in the period that such determination is made. The tax returns for fiscal 2001, through 2013 are subject
to audit or review by the US tax authority, whereas fiscal 2010 through 2013 are subject to audit or review by the Canadian tax
authority.





Table of Contents20







GREENESTONE HEALTHCARE CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS



2. Summary
                                         of Significant Accounting Policies (continued)



l) Loss per share information



FASB ASC 260-10, “Earnings
Per Share” provides for calculation of "basic" and "diluted" earnings per share. Basic earnings per
share includes no dilution and is computed by dividing net income (loss) applicable to common shareholders by the weighted average
common shares outstanding for the period. Diluted earnings per share reflect the potential dilution of securities that could share
in the earnings of an entity similar to fully diluted earnings per share. The effect of computing diluted loss per share is anti-dilutive
and, as such, basic and diluted loss per share is the same for the years ended December 31, 2015 and 2014.



m) Stock based compensation



ASC 718-10 "Compensation
- Stock Compensation" prescribes accounting and reporting standards for all stock-based payments awarded to employees, including
employee stock options, restricted stock, employee stock purchase plans and stock appreciation rights that may be classified as
either equity or liabilities. The Company should determine if a present obligation to settle the share-based payment transaction
in cash or other assets exists. A present obligation to settle in cash or other assets exists if: (a) the option to settle by
issuing equity instruments lacks commercial substance or (b) the present obligation is implied because of an entity's past practices
or stated policies. If a present obligation exists, the transaction should be recognized as a liability; otherwise, the transaction
should be recognized as  equity.



The Company accounts
for stock-based compensation issued to non-employees and consultants in accordance with the provisions of ASC 505-50 "Equity
- Based Payments to Non-Employees". Measurement of share-based payment transactions with non-employees shall be based on
the fair value of whichever is more reliably measurable: (a) the goods or services received; or (b) the equity instruments issued.
The fair value of the share-based payment transaction should be determined at the earlier of performance commitment date or performance
completion date.



n) Legal proceedings



The costs of prosecuting and defending
legal actions are expensed as incurred.



o) Accounting for uncertainty in income taxes



The Financial Accounting
Standards Board has issued guidance on Accounting for Uncertainty in Income Taxes, FASB ASC 740, Income Taxes which prescribes
a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken
or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be
sustained upon examination by taxing authorities. The amount recognized is measured as the largest amount of benefit that has
a greater than 50% likelihood of being realized upon ultimate settlement. Management has concluded that the Company has taken
no uncertain tax positions that require adjustment to the financial statements to comply with the provisions of this guidance.
When applicable, the Company will include interest and penalties related to uncertain tax positions in income tax expense.





Table of Contents21







GREENESTONE HEALTHCARE CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS



2. Summary
                                         of Significant Accounting Policies (continued)



p) Derivatives



The Company evaluates embedded
conversion features within convertible debt under ASC 815 “Derivatives and Hedging” to determine whether the embedded
conversion feature should be bifurcated from the host instrument and accounted for as a derivative at fair value with changes
in fair value recorded in earnings. The Company uses a Black-Scholes Option Pricing model to estimate the fair value of convertible
debt conversion features at the end of each applicable reporting period. Changes in the fair value of these derivatives during
each reporting period are included in the statements of operations. Inputs into the Black-Scholes Option Pricing model require
estimates, including such items as estimated volatility of the Company’s stock, risk-free interest rate and the estimated
life of the financial instruments being fair  valued.



If the conversion feature
does not require derivative treatment under ASC 815, the instrument is evaluated under ASC 470-20 “Debt with Conversion
and Other Options” for consideration of any beneficial conversion feature.



q) Recent accounting pronouncements



In January 2015, the FASB issued
ASU No. 2015-01, “Income Statement - Extraordinary and Unusual Items (Subtopic 225-20): Simplifying Income Statement Presentation
by Eliminating the Concept of Extraordinary Items.” This ASU eliminates from U.S. GAAP the concept of extraordinary items.
ASU 2015-01 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015. A
reporting entity may apply the amendments prospectively. We do not expect the adoption of ASU 2015-01 to have a material effect
on our financial position, results of operations or cash flows.



In February 2015, the FASB issued ASU No. 2015-02, Consolidation (Topic 810): Amendments
to the Consolidation Analysis, which is intended to improve targeted areas of consolidation guidance for legal entities such as
limited partnerships, limited liability corporations, and securitization structures (collateralized debt obligations, collateralized
loan obligations, and mortgage-backed security transactions). The ASU focuses on the consolidation evaluation for reporting organizations
that are required to evaluate whether they should consolidate certain legal entities. In addition to reducing the number of consolidation
models from four to two, the new standard simplifies the FASB Accounting Standards Codification and improves current U.S. GAAP
by placing more emphasis on risk of loss when determining a controlling financial interest, reducing the frequency of the application
of related-party guidance when determining a controlling financial interest in a variable interest entity (“VIE”),
and changing consolidation conclusions for companies in several industries that typically make use of limited partnerships or
VIEs. The ASU will be effective for fiscal years, and interim periods within those fiscal years, beginning after December 15,
2015. Early adoption is permitted, including adoption in an interim period. We do not expect the adoption of ASU 2015-02 to have
a material effect on our financial position, results of operations or cash flows.





In April 2015, FASB issued Accounting Standards Update (“ASU”) No. 2015-03,
Interest– Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs, is to simplify
presentation of debt issuance costs by requiring that debt issuance costs related to a recognized debt liability be presented
in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The
ASU does not affect the recognition and measurement guidance for debt issuance costs. For public companies, the ASU is effective
for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years.
Early application is permitted. This updated guidance is not expected to have a material impact on our results of operations,
cash flows or financial condition.

Table of Contents22





GREENESTONE HEALTHCARE CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS



2. Summary
                                         of Significant Accounting Policies (continued)



q) Recent accounting pronouncements (continued)



In April 2015, FASB issued Accounting
Standards Update No. 2015-05, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Customer’s
Accounting for Fees paid in a Cloud Computing Arrangement, provides guidance to customers about whether a cloud computing
arrangement includes a software license. If such an arrangement includes a software license, then the customer should account
for the software license element of the arrangement consistent with the acquisition of other software licenses. If the arrangement
does not include a software license, the customer should account for it as a service contract. For public business entities, the
ASU is effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2015.
Early application is permitted. This updated guidance is not expected to have a material impact on our results of operations,
cash flows or financial condition.



In April 2015, FASB issued Accounting
Standards Update No. 2015-06, Earnings Per Share (Topic 260): Effects on Historical Earnings per Unit of Master Limited Partnership
Dropdown Transactions, specifies that, for purposes of calculating historical earnings per unit under the two-class method,
the earnings (losses) of a transferred business before the date of a drop down transaction should be allocated entirely to the
general partner. In that circumstance, the previously reported earnings per unit of the limited partners (which is typically the
earnings per unit measure presented in the financial statements) would not change as a result of the dropdown transaction. Qualitative
disclosures about how the rights to the earnings (losses) differ before and after the dropdown transaction occurs for purposes
of computing earnings per unit under the two-class method also are required. The ASU is effective for fiscal years beginning after
December 15, 2015, and interim periods within those fiscal years. Earlier application is permitted. This updated guidance is not
expected to have a material impact on our results of operations, cash flows or financial condition.



In May 2015, the Financial Accounting
Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2015-07, “Fair Value Measurement
(Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent)”
(“ASU 2015-07”). This guidance eliminates the requirement to categorize investments within the fair value hierarchy
if their fair value is measured using the net asset value (“NAV”) per share practical expedient in the FASB’s
fair value measurement guidance. The new standard is effective for fiscal years and interim periods within those fiscal years,
beginning after December 15, 2015 The Company does not expect the adoption of ASU 2015-07 to have a material effect on its consolidated
financial statements.



In July 2015, FASB issued Accounting Standards Update (“ASU”) No. 2015-11,
“Inventory (Topic 330): Simplifying the Measurement of Inventory” more closely align the measurement of inventory
in GAAP with the measurement of inventory in International Financial Reporting Standards (IFRS). The amendments in this ASU do
not apply to inventory that is measured using last-in, first-out (LIFO) or the retail inventory method. The amendments apply to
all other inventory, which includes inventory that is measured using first-in, first-out (FIFO) or average cost.An entity
should measure inventory within the scope of this Update at the lower of cost and net realizable value. Net realizable value is
the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and
transportation. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method. For public
business entities, this ASU is effective for fiscal years beginning after December 15, 2016, including interim periods within
those fiscal years. For all other entities, this ASU is effective for fiscal years beginning after December 15, 2016, and interim
periods within fiscal years beginning after December 15, 2017. The amendments in this ASU should be applied prospectively with
earlier application permitted as of the beginning of an interim or annual reporting period. We are currently reviewing the
provisions of this ASU to determine if there will be any impact on our results of operations, cash flows or financial condition.

Table of Contents23





GREENESTONE HEALTHCARE CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS



2. Summary
                                         of Significant Accounting Policies (continued)



q) Recent accounting pronouncements (continued)



In August 2015,FASB issued
Accounting Standards Update (“ASU”) No.2015-14, “Revenue from Contracts with Customers (Topic 606): Deferral
of the Effective Date” defers the effective date ASU No. 2014-09 for all entities by one year. Public business entities,
certain not-for-profit entities, and certain employee benefit plans should apply the guidance in Update 2014-09 to annual reporting
periods beginning after December 15, 2017, including interim reporting periods within that reporting period. Earlier application
is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within
that reporting period. All other entities should apply the guidance in Update 2014-09 to annual reporting periods beginning after
December 15, 2018, and interim reporting periods within annual reporting periods beginning after December 15, 2019. All other
entities may apply the guidance in ASU No. 2014-09 earlier as of an annual reporting period beginning after December 15, 2016,
including interim reporting periods within that reporting period. All other entities also may apply the guidance in Update 2014-09
earlier as of an annual reporting period beginning after December 15, 2016, and interim reporting periods within annual reporting
periods beginning one year after the annual reporting period in which the entity first applies the guidance in ASU No. 2014-09.
We are currently reviewing the provisions of this ASU to determine if there will be any impact on our results of operations, cash
flows or financial condition.



In August 2015, the Financial Accounting
Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2015-15, “Interest - Imputation
of Interest (Subtopic 835-30).” ASU 2015-15 provides guidance as to the presentation and subsequent measurement of debt
issuance costs associated with line of credit arrangements. We do not expect the adoption of ASU 2015-15 to have a material effect
on our financial position, results of operations or cash flows.



In September 2015,FASB
issued Accounting Standards Update (“ASU”) No. 2015-16, “Business Combinations (Topic 805): Simplifying the
Accounting for Measurement-Period Adjustments”requires that an acquirer recognize adjustments to provisional amounts
that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The
amendments in this Update require that the acquirer record, in the same period’s financial statements, the effect on earnings
of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the provisional amounts,
calculated as if the accounting had been completed at the acquisition date. For public business entities, the amendments are effective
for fiscal years beginning after December 15, 2015, including interim periods within those fiscal years. The amendments should
be applied prospectively to adjustments to provisional amounts that occur after the effective date of this Update with earlier
application permitted for financial statements that have not been issued. For all other entities, the amendments are effective
for fiscal years beginning after December 15, 2016, and interim periods within fiscal years beginning after December 15, 2017.
The amendments should be applied prospectively to adjustments to provisional amounts that occur after the effective date of this
Update with earlier application permitted for financial statements that have not yet been made available for issuance. We are
currently reviewing the provisions of this ASU to determine if there will be any impact on our results of operations, cash flows
or financial condition.



In November 2015, the FASB issued (ASU) 2015-17, Balance Sheet Classification of Deferred
Taxes. Currently deferred taxes for each tax jurisdiction are presented as a net current asset or liability and net noncurrent
asset or liability on the balance sheet. To simplify the presentation, the new guidance requires that deferred tax liabilities
and assets for all jurisdictions along with any related valuation allowances be classified as noncurrent in a classified statement
of financial position. This guidance is effective for interim and annual reporting periods beginning after December 15, 2016,
and early adoption is permitted. The Company has adopted this guidance in the fourth quarter of the year ended December 31, 2015
on a retrospective basis. The adoption of this guidance did not have a material impact on the Company’s financial position,
results of operations or cash flows, and did not have any effect on prior periods due to the full valuation allowance against
the Company’s net deferred tax assets.



Table of Contents24





GREENESTONE HEALTHCARE CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS



2. Summary
                                         of Significant Accounting Policies (continued)



q) Recent accounting pronouncements (continued)



In January 2016, the Financial
Accounting Standards Board (“FASB”) issued Accounting Standards Update (ASU) 2016-01, which amends the guidance in
U.S. GAAP on the classification and measurement of financial instruments. Changes to the current guidance primarily affect the
accounting for equity investments, financial liabilities under the fair value option, and the presentation and disclosure requirements
for financial instruments. In addition, the ASU clarifies guidance related to the valuation allowance assessment when recognizing
deferred tax assets resulting from unrealized losses on available-for-sale debt securities. The new standard is effective for
fiscal years and interim periods beginning after December 15, 2017, and upon adoption, an entity should apply the amendments by
means of a cumulative-effect adjustment to the balance sheet at the beginning of the first reporting period in which the guidance
is effective. Early adoption is not permitted except for the provision to record fair value changes for financial liabilities
under the fair value option resulting from instrument-specific credit risk in other comprehensive income. The Company is currently
evaluating the impact of adopting this guidance.



Any new accounting standards, not
disclosed above, that have been issued or proposed by FASB that do not require adoption until a future date are not expected to
have a material impact on the financial statements upon adoption.



r) Financial instruments



The Company is exposed
to various risks through its financial instruments. The following analysis provides a measure of the Company’s risk exposure
and concentrations at the balance sheet date, December 31, 2015 and 2014.



I) Credit risk



Credit risk is the risk that one
party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation. Financial
instruments that subject the Company to credit risk consist primarily of accounts receivable.



Credit risk associated with accounts
receivable of Greenestone Clinic Muskoka Inc. is mitigated due to balances from many customers, as well as through credit checks
and frequent reviews of receivables to ensure timely collection. In addition, there is no concentration risk with the Greenestone
Clinic Muskoka Inc. accounts receivable balance since balances are due from many  customers.



In the opinion of management,
credit risk with respect to accounts receivable is assessed as low, not material and remains unchanged from the prior year.



II) Liquidity risk



Liquidity risk is the risk the Company will not be able to meet its financial obligations
as they fall due. The Company is exposed to liquidity risk through its working capital deficiency of $(3,604,423) and accumulated
deficit of $(20,721,205). As disclosed in note 3, the Company will be dependent upon the raising of additional capital in order
to implement its business plan. There is no assurance that the Company will be successful with future financing ventures, and
the inability to secure such financing may have a material adverse effect on the Company’s financial condition. In the opinion
of management, liquidity risk is assessed as high, material and remains unchanged from the prior year.



III) Market risk



Market risk is the risk that the fair value or future cash flows of a financial
instrument will fluctuate because of changes in market prices. Market risk comprises of three types of risk: interest rate risk,
currency risk, and other price risk. The Company is exposed to interest rate risk and currency risk.

Table of Contents25





GREENESTONE HEALTHCARE CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS



2. Summary
                                         of Significant Accounting Policies (continued)



r) Financial instruments (continued)



i. Interest rate risk



Interest rate risk is
the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest
rates. The Company is exposed to minimal interest rate risk on its bank indebtedness as there is a balance of $15,801 at December
31, 2015. This liability is based on floating rates of interest that have been stable during the current reporting period. In
the opinion of management, interest rate risk is assessed as low, not material and remains unchanged from  the prior year.



ii. Currency risk



Currency risk is the
risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange
rates. The Company is subject to currency risk as its subsidiaries operate in Canada and are subject to fluctuations in the Canadian
dollar. Most of the Company’s financial assets and liabilities are denominated in Canadian dollars. Based on the net exposures
at December 31, 2015, a 5% depreciation or appreciation of the Canadian dollar against the U.S. dollar would result in an approximate
$58,200 increase or decrease in the Company’s after-tax net loss from continuing operation. The Company has not entered
into any hedging agreements to mediate this risk. In the opinion of management, currency risk is assessed as low, material and
remains unchanged from the prior year.



iii. Other price risk



Other price risk is the
risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices (other
than those arising from interest rate risk or currency risk), whether those changes are caused by factors specific to the individual
financial instrument or its issuer, or factors affecting all similar financial instruments traded in the market. In the opinion
of management, the Company is not exposed to this risk and remains unchanged from  the prior year.



3. Going Concern



The Company’s consolidated
financial statements have been prepared in accordance with US GAAP applicable to a going concern, which assumes that the Company
will be able to meet its obligations and continue its operations in the normal course of business. As at December 31, 2015 the
Company has a working capital deficiency of $(3,604,423) and accumulated deficit of $(20,721,205). Management believes that current
available resources will not be sufficient to fund the Company’s planned expenditures, including past due payroll and sales
tax payments, as well as estimated penalties and interest, over the next 12 months. Accordingly, the Company will be dependent
upon the raising of additional capital through placement of common shares, and, or debt financing in order to implement its business
plan, and, or generating sufficient revenue in excess of costs. If the Company raises additional capital through the issuance
of equity securities or securities convertible into equity, stockholders will experience dilution, and such securities may have
rights, preferences or privileges senior to those of the holders of common stock or convertible senior notes. If the Company raises
additional funds by issuing debt, the Company may be subject to limitations on its operations, through debt covenants or other
restrictions. If the Company obtains additional funds through arrangements with collaborators or strategic partners, the Company
may be required to relinquish its rights to certain geographical areas, or techniques that it might otherwise seek to retain.
There is no assurance that the Company will be successful with future financing ventures, and the inability to secure such financing
may have a material adverse effect on the Company’s financial condition. These consolidated financial statements do not
include any adjustments to the amounts and classifications of assets and liabilities that might be necessary should the Company
be unable to continue  operations.



These factors create substantial doubt about the Company’s ability to continue
as a going concern. These consolidated financial statements do not include any adjustments relating to the recoverability or classification
of recorded assets and liabilities or other adjustments that may be necessary should the Company not be able to continue as a
going concern.

Table of Contents26





GREENESTONE HEALTHCARE CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS



3. Going Concern (continued)



The ability of the Company
to continue as a going concern is dependent on the Company generating cash from the sale of its common stock or obtaining debt
financing and attaining future profitable operations. Management's plans include selling its equity securities and obtaining debt
financing to fund its capital requirement and ongoing operations; however, there can be no assurance the Company will be successful
in these efforts.



4. Accounts receivable



The  accounts receivable
balance consists primarily of amounts due from the following parties:



|                                |  | December 31, 2015 |         | December 31, 2014
|------------------------------- |  | ----------------- | ------- | -----------------
|                                |  |                   |         |                  
|Treatment program               |  | $                 | 183,583 |                  
|Outpatient services             |  |                   | —       |                  
|                                |  |                   | 183,583 |                  
|Allowance for doubtful accounts |  |                   | —       |                  
|                                |  | $                 | 183,583 |                  



5. Due from sale of subsidiary



OnDecember 17,2014,theCompany
completed thesale ofall the
outstandingshares oftheEndoscopy
clinic,for thesum of CAD$1,282,002,comprised oftheagreed
purchase price of CAD$1,250,000and theacquisition
ofnet assets at closing ofCAD$32,002The
sale price of CAD$1,282,002included theassumption bythe
buyerof debtin thesame
amount as thesale price, whichdebt
was owedbytheEndoscopyclinicto theCompany
in theamount ofCAD$895,460and
to the buyerofCAD
$386,542. Atclosing,the buyeroffsettheassumed debtto theCompany ofCAD$895,460byUS$277,500throughthecancellation
of2,408,268 shares oftheCompany’s
common stock,for a net amount dueto theCompany ofCAD$617,960.This debtis owedbythe
buyerto theCompany in theformofan
interest bearing note witha couponof
5%per annum. The notewas originallydueonJune 30,
2015 whichwasrecently extendedto
December 31, 2015. The amount outstandingofCAD$617,960wasrevalued
at US$446,476and US$493,806as ofDecember 31,
2015and 2014,respectively. Management evaluatedthisreceivable
as ofDecember 31, 2015and a
provision for thefull valueofthe
notewasraised as ofDecember 31,2015



The amount due on the sale if subsidiary
is as follows:



|                      |  | December 31, 2015 |          | December 31, 2014
|--------------------- |  | ----------------- | -------- | -----------------
|                      |  |                   |          |                  
|Principal outstanding |  | $                 | 446,476  |                  
|Accrued interest      |  |                   | —        |                  
|                      |  |                   | 446,476  |                  
|Provision raised      |  |                   | (446,476 | )                
|                      |  | $                 | —        |                  



Table of Contents27







GREENESTONE HEALTHCARE CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS



6. Plant and equipment



Plant and equipment consists of the following:



|                        |  | Cost |         | Accumulated
depreciation |  | Net book value December 31, 2015 |         | Net book value December 31, 2014
|----------------------- |  | ---- | ------- | ------------------------ |  | -------------------------------- | ------- | --------------------------------
|                        |  |      |         |                          |  |                                  |         |                                 
|Computer equipment      |  | $    | 21,278  |                          |  | $                                | 15,333  |                                 
|Computer software       |  |      | 9,848   |                          |  |                                  | 4,924   |                                 
|Furniture and equipment |  |      | 352,379 |                          |  |                                  | 257,728 |                                 
|Medical equipment       |  |      | 4,490   |                          |  |                                  | 3,443   |                                 
|Vehicles                |  |      | 64,175  |                          |  |                                  | 42,993  |                                 
|Leasehold improvements  |  |      | 142,793 |                          |  |                                  | 77,411  |                                 
|                        |  | $    | 594,963 |                          |  | $                                | 401,832 |                                 



Depreciation expense for the year ended
December 31, 2015 and 2014 was $90,862 and $83,701, respectively.



7. Loans payable



The Company has an automobile loan payable bearing interest at 4.49% with blended monthly
payments of $835 that matures in March 2018. The loan is secured by the vehicle with a net book value as at December 31, 2015
of $14,960.



|                   |  | December 31, 2015 |        | December 31, 2014
|------------------ |  | ----------------- | ------ | -----------------
|Automobile loan    |  |                   |        |                  
|Short-term portion |  | $                 | 6,684  |                  
|Long-term portion  |  |                   | 8,788  |                  
|                   |  | $                 | 15,472 |                  



Estimated principal re-payments
are as follows:



| |      |  |  | Amount
| | ---- |  |  | ------
| |      |  |  |       
| | 2016 |  |  |       
| | 2017 |  |  |       
| | 2018 |  |  |       
| |      |  |  |       



8. Short-term convertible loan



In May 2013 the company entered
into a promissory note of up to $500,000 where the maturity date was one year after the lender provides the borrower with funds.
A onetime interest rate of 12% was applied in case of nonpayment within the initial 90 days. The note was convertible at the lesser
of $0.30 or 70% of the lowest trading price in the 25 trading days prior to conversion. In 2014 the Company received $105,000 in
proceeds and converted $127,076 into 2,245,991 shares of common stock. As of December 31, 2014 the net balance of this loan amounted
to $29,758 comprised of a principal balance of $42,467 and a net debt discount of $12,709. During the year ended December 31, 2015
the Company made cash payments amounting to $34,350 principal plus interest of $6,870 and converted $8,117 through the issuance
of 300,000 shares of common stock to repay the loan infull.



Table of Contents28







GREENESTONE HEALTHCARE CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS



9. Taxation Payable



The Company has the following outstanding tax liabilities:



a) Harmonized Sales taxes



This represents sales tax liabilities
in Canada, these taxes were never paid, management intends paying these taxation liabilities together with interest and penalties
thereon, when sufficient funds are raised to do so.



b) Payroll taxes



The Company is delinquent in filing its payroll tax returns resulting in taxes, interest
and penalties payable at December 31, 2015 and 2014. As of December 31, 2015 and 2014 as part of TaxesPayable, the Company has payroll tax liabilities of approximately $1,780,000 and $2,065,000, respectively due to various
taxing authorities. If the Company does not satisfy these liabilities, the taxing authorities may place liens on its bank accounts
which would have a negative impact on its ability to operate. Further, the actual liability may be higher due to interest or penalties
assessed by the taxing authorities.



c) US taxation and penalties



The Company has assets and operates a business in
Canada and is required to disclose these operations to the US taxation authorities, the requisite disclosure has not been made
and management has reserved the maximum penalty due to the IRS in terms of non-disclosure. This non-compliance with US disclosure
requirements is currently being addressed.



The taxes and penalties due as of December 31, 2015
and 2014 is as follows:



|                                         |  | December 31, 2015 |           | December 31, 2014
|---------------------------------------- |  | ----------------- | --------- | -----------------
|                                         |  |                   |           |                  
|Payroll taxes and Harmonized sales taxes |  | $                 | 2,290,506 |                  
|US taxes and penalties                   |  |                   | 200,000   |                  
|                                         |  | $                 | 2,490,506 |                  



10. Related party Transactions



GreeneStone Clinic
Inc.

As of December 31, 2015
and 2014, the Company owed $5,284 and $84,736, respectively. GreeneStone Clinic Inc., is controlled by one of the Company’s
directors. The balance owing is non-interest bearing, not secured and has no specified terms of repayment.



The Company incurred management
fees from GreeneStone Clinic, Inc., totaling $96,705 and $122,271 for the years ended December 31, 2015 and 2014, respectively.



Shawn E. Leon

As of December 31, 2015
the Company owed $159,551and as of December 31, 2014, the Company was owed $33,400 from Shawn E. Leon our CEO. The amounts owed
and owing are non-interest bearing and have no fixed repayment terms.



1816191 Ontario

As of December 31, 2015, the Company owes $22,305 to 1816191 Ontario, the Endoscopy
Clinic which was sold at the end of the prior year. The payable is non-interest bearing, and has no specific repayment terms.



Table of Contents29





GREENESTONE HEALTHCARE CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS



10. Related
party Transactions (continued)



Cranberry Cove Holdings Ltd.

The Company entered intoan agreement to lease premises fromCranberry CoveHoldingsLtd. at market terms. The Company had rental expense amountingto CAD$451,380and CAD$412,488for
theyear endedDecember 31,
2015and 2014,respectively. Cranberry CoveHoldingsLtd. is related to theCompany
byvirtue of itsshareholder owning 1816191
Ontario.



As of December 31, 2015, the
Company owed Cranberry Cove holdings $87,356 (CAD$120,908) in accrued rent.



All related party transactions occur in the normal course of operations and in terms
of agreements entered into between the parties.



11. Stockholders’ deficit



a) Common shares



Authorized

On June 30, 2012,
the Company filed a Certificate of Amendment with the Colorado Secretary of State to increase the aggregate number of shares,
which the Company has authority to issue to 100,000,000 common shares, issued at $0.01 par value per share from 50,000,000 common
shares with par value at $0.01. The amendment was approved by the Colorado Secretary of State in May 2012.



On March 25, 2013, the
Company filed a certificate of Amendment with the Colorado Secretary of State to increase the aggregate number of shares which
the Company has the authority to issue to 500,000,000 common shares, issued at $0.01 par value per share from 100,000,000 common
shares with par value at $0.01. The amendment was approved by the Colorado Secretary of State on March 26, 2013.



Issued and outstanding

The Company has a
total of 47,738,855 and 46,131,764 issued and outstanding common shares as at December 31, 2015 and 2014, respectively.



The Company issued 300,000 shares
of its common stock to satisfy its obligations under the conversion of an aggregate principal amount of $8,117 of convertible
promissory notes on January 14, 2015.



On March 31, 2015, the Company adjusted the
number of shares previously issued by 2,909 common shares pursuant to convertible note conversions to reflect the currency exchange
differences not previously taken into account.



On march 31, 2015, the Company issued 250,000 shares of its common stock and 106,000
shares of its Series B preferred stock as compensation for services rendered amounting to$56,096.



On April 30, 2015, the
holders of 106,000 Series “B” preferred shares converted their shares into 1,060,000 common shares at a conversion
ratio of 10 common shares for 1 Series B preferred share.



b) Preferred shares



Authorized

On March 25, 2013,
the Company, under the certificate of amendment filed above also to authorize 3,000,000 series A convertible preferred shares
with a par value of $0.01 per share, and also to authorize 10,000,000 series B convertible preferred shares, par value $0.01 per
share. Each series B convertible preferred share is convertible into 10 Common shares. The amendment was approved by the Colorado
Secretary of State on March 26, 2013.



Issued and outstanding

The Company had no issued and outstanding preferred shares as at December 31,
2015.

Table of Contents30





GREENESTONE HEALTHCARE CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS



11.
                                         Stockholders’ deficit (continued)



b) Preferred shares (continued)



On April 30, 2015, the holders of 106,000
Series “B” preferred shares converted their shares into 1,060,000 common shares at a conversion ratio of 10 common
shares for 1 Series B preferred share.



c) Warrants



No warrants were issued, exercised or cancelled
for the year under review.



The movement in warrants outstanding is summarized
below.



| |                                  | Number of warrants outstanding |  | Weighted average exercise price per share
| | -------------------------------- | ------------------------------ |  | -----------------------------------------
| |                                  |                                |  |                                          
| | Outstanding at January 1, 2014   |                                |  |                                          
| | Granted                          |                                |  |                                          
| | Cancelled/forfeited              |                                |  |                                          
| | Exercised                        |                                |  |                                          
| | Outstanding at December 31, 2014 |                                |  |                                          
| | Granted                          |                                |  |                                          
| | Cancelled/forfeited              |                                |  |                                          
| | Exercised                        |                                |  |                                          
| | Outstanding at December 31, 2015 |                                |  |                                          





The following table summarizes information about
warrants outstanding at December 31, 2015



|               |       | Warrants outstanding and exercisable
|-------------- | ----- | ------------------------------------
|Exercise
price |       | Number
of warrants                  
|               |       |                                     
|$              | 0.003 |                                     
|$              | 0.15  |                                     
|               |       |                                     



* In terms of an agreement entered
into with an investor relations company, 300,000 warrants were to be issued as part of the Investor Relations Agreement. These
warrants have not been issued as yet, therefore the warrant terms are uncertain.



As of December 31, 2015 the 6,300,000 warrants were all vested, there were no unrecognized
compensation costs related to these warrants and the intrinsic value of the warrants as of December 31, 2015 is $20,000.





Table of Contents31







GREENESTONE HEALTHCARE CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS



11.
                                         Stockholders’ deficit (continued)



d)
Stock options



Our board of directors adopted
the GreeneStone Healthcare Corporation 2013 Stock Option Plan (the “Plan”) to promote our long-term growth and profitability
by (i) providing our key directors, officers and employees with incentives to improve stockholder value and contribute to our
growth and financial success and (ii) enable us to attract, retain and reward the best available persons for positions of substantial
responsibility. A total of 10,000,000 shares of our common stock have been reserved for issuance upon exercise of options granted
pursuant to the Plan. The Plan allows us to grant options to our employees, officers and directors and those of our subsidiaries;
provided that only our employees and those of our subsidiaries may receive incentive stock options under the Plan. We have granted
a total of 480,000 options as of December 31, 2015 under the Plan.



No options were issued, exercised or cancelled
for the year under review.



The movement in options outstanding is summarized
below.



| |                                  | Number of options outstanding |  | Weighted average exercise price per share
| | -------------------------------- | ----------------------------- |  | -----------------------------------------
| |                                  |                               |  |                                          
| | Outstanding at January 1, 2014   |                               |  |                                          
| | Granted                          |                               |  |                                          
| | Cancelled/forfeited              |                               |  |                                          
| | Exercised                        |                               |  |                                          
| | Outstanding at December 31, 2014 |                               |  |                                          
| | Granted                          |                               |  |                                          
| | Cancelled/forfeited              |                               |  |                                          
| | Exercised                        |                               |  |                                          
| | Outstanding at December 31, 2015 |                               |  |                                          



The following table summarizes information about
options outstanding at December 31, 2015



|               |      | Options outstanding |  | Options Exercisable                         
|-------------- | ---- | ------------------- |  | --------------------------------------------
|Exercise
price |      | Number
of options   |  | Weighted average remaining contractual years
|$              | 0.12 |                     |  |                                             



The Company agreed to issue Stock options to a
former officer vesting over a 24-month period commencing on November 1, 2014 expiring on October 31, 2019, a formal option agreement
has not been issued as yet, as such the terms of these options are uncertain.



As of December 31, 2015 there was no unrecognized
compensation costs related to these options and the intrinsic value of the options as of December 31, 2015 is $0.

Table of Contents32





GREENESTONE HEALTHCARE CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS





12. Discontinued operations – 1816191 Ontario limited



In the prior year, On December 17, 2014, the Company completed the sale of the
Endoscopy business to  a Company owned by Dr. Jay Parekh, for the sum of CDN$1,282,002, comprised of the agreed
purchase price of CDN$1,250,000 and the acquisition of net assets at closing of CDN$32,002 The sale price of CDN$1,282,002
included the assumption by the buyer of debt in the same amount as the sale price, which debt is owed by the Endoscopy clinic
to the Company in the amount of CDN$895,460 and to the buyer of CDN$386,542. At closing, the buyer offset the assumed debt to
the Company of CDN$895,460 by CDN$277,500 through the cancellation of 2,408,268 shares of the Company’s common stock,
for a net amount due to the Company of CDN$617,960. This debt is owed by the buyer to the Company in the form of an interest
bearing note with a coupon of 5% per annum.



13. Commitments and contingencies



a) Operating leases



The Company has entered
into a lease agreement for the rental of premises operated by GreeneStone Clinic Muskoka Inc. which term initially expires on
March 31, 2019. The Company has an option to extend the lease for an additional three terms, each term being an additional three
years. The Company also has an option to purchase the property for $10,000,000, which option must be exercised in writing, accompanied
by a $250,000 deposit and must be closed within 30 days of exercising the option. The Company also has a right of first refusal
should the landlord receive an acceptable offer for the premises, the Company would be entitled to acquire the premises on the
same terms and conditions of the acceptable offer, provided the Company has met certain covenants. The rental expense for the
year ended December 31, 2015 was $255,020.



The future minimum annual rental
payments under the operating lease are estimated as follows, using the year end exchange rate of CAD$1 equals US$0,7225:



| |      |  |  | Amount
| | ---- |  |  | ------
| |      |  |  |       
| | 2016 |  |  |       
| | 2017 |  |  |       
| | 2018 |  |  |       
| | 2019 |  |  |       
| |      |  |  |       



b) Contingency related to outstanding tax liabilities



The Company is delinquent in paying harmonized sales tax, filing and paying payroll
taxes and may also be subject to US taxation and penalties as fully disclosed in note 9 above.



As of December 31,
2015, the Company had estimated Canadian tax liabilities outstanding of $2,290,506, which may result in the Canadian tax authorities
placing liens on the Company bank accounts which would impact on the Company’s ability to operate. The Company has also
provided for US tax liabilities of $200,000 due to non-compliance with the filing of certain required returns. The actual liability
may be higher due to interest and penalties assessed by these taxing authorities.



c) Other



From time to time, the Company and its subsidiaries enter into legal disputes
in the ordinary course of business. The Company believes there are no material legal or administrative matters pending that are
likely to have, individually or in the aggregate, a material adverse effect on its business or results of operations.

Table of Contents33





GREENESTONE HEALTHCARE CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS



14. Income taxes



The Company is not current
in its tax filings as of December 31, 2015.



The Company accounts for
income taxes under Accounting Standards Codification 740, Income Taxes “ASC 740”. ASC 740 requires the recognition
of deferred tax assets and liabilities for both the expected impact of differences between the financial statements and the tax
basis of assets and liabilities, and for the expected future tax benefit to be derived from tax losses and tax credit carry forwards.
ASC 740 additionally requires the establishment of a valuation allowance to reflect the likelihood of realization of deferred
tax assets. Internal Revenue Code Section 382 “IRC 382” places a limitation on the amount of taxable income that can
be offset by carry forwards after a change in control (generally greater than a 50% change in ownership).



The components of the Company’s
future tax asset as at December 31, 2015 and December 31, 2014 are as follows:



|                                 |  | December 31, 2015 |             | December 31, 2014
|-------------------------------- |  | ----------------- | ----------- | -----------------
|                                 |  |                   |             |                  
|Net operating loss carry forward |  | $                 | 20,224,729  |                  
|Valuation allowance              |  |                   | (20,224,729 | )                
|                                 |  | $                 | —           |                  



A reconciliation of income taxes
computed at the 35% statutory rate to the income tax recorded is as follows:



|                                       |  | December 31, 2015 |          | December 31, 2014
|-------------------------------------- |  | ----------------- | -------- | -----------------
|                                       |  |                   |          |                  
|Taxation benefit at statutory tax rate |  | $                 | 230,545  |                  
|Foreign taxation                       |  |                   | 4,647    |                  
|Permanent Differences                  |  |                   | 23,571   |                  
|Timing differences not provided for    |  |                   | 176,938  |                  
|Foreign tax rate differential          |  |                   | 4,164    |                  
|Valuation allowance                    |  |                   | (230,545 | )                
|                                       |  | $                 | —        |                  



As at December 31, 2015,
the Company is in arrears on filing its statutory income tax returns and the amounts presented above are based on estimates. The
actual losses available could differ from these estimates. In addition, the Company could be subject to penalties for these unfiled
tax returns.



During the year ended
December 31, 2015, the Company has accrued and expensed $200,000 (2014: $150,000) in penalties and interest attributable to delinquent
tax returns. Management believes the Company has adequately provided for any ultimate amounts that are likely to result from audits
of these returns once filed; however, final assessments, if any, could be significantly different than the amounts recorded in
the financial statements.



The Company operates in
foreign jurisdictions and is subject to audit by taxing authorities. These audits may result in the assessment of amounts different
than the amounts recorded in the consolidated financial statements. The Company liaises with the relevant authorities in these
jurisdictions in regard to its income tax and other returns. Management believes the Company has adequately provided for any taxes,
penalties and interest that may fall due.



15. Subsequent events





The Company is currently negotiating
a Securities Purchase Agreement with JMJ Financial in terms of which the Company will borrow $200,000 in terms of an unsecured
convertible promissory note with a maturity date of seven months from the closing date for net proceeds of $160,000, after a 10%
original issue discount and a 10% one-time interest charge. The promissory note is only convertible upon a repayment default,
at a price to be determined. The Company will also issue, in terms of the financing, 3,703,700 warrants exercisable over common
shares at $0.03 per share, which warrants contain a cashless exercise option.



Other than disclosed above, the Company has evaluated subsequent events through the
date of the consolidated financial statements were available to be issued and has concluded that no such events or transactions
took place that would require disclosure herein.

Table of Contents34





Item 9. Changes in
and Disagreements with Accountants on Accounting and Financial Disclosure.



None.



Item 9A. Controls and Procedures.



a) Evaluation of Disclosure and Control Procedures



The Company’s
disclosure controls and procedures are designed to ensure (i) that information required to be disclosed by the Company in the
reports the Company files or submits under the Exchange Act are recorded, processed, summarized, and reported within the time
periods specified in the SEC’s rules and forms; and (ii) that information required to be disclosed by the Company in the
reports it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including
its principal executive officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required
disclosure.



Our principal executive
officer and principal financial officer evaluated the effectiveness of the design and operation of our disclosure controls and
procedures as of December 31, 2015, and concluded that the disclosure controls and procedures were not effective as a whole, and
that the deficiency involving internal controls constituted a material weakness as discussed below.



b) Management’s Assessment of Internal Control over Financial Reporting



Management is responsible
for establishing and maintaining adequate internal control over financial reporting, as such term is defined in the Exchange Act
Rules 13a-15(f). A system of internal control over financial reporting is a process designed to provide reasonable assurance regarding
the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally
accepted accounting principles.



Under the supervision
and with the participation of management, including the principal executive officer and the principal financial officer, the Company’s
management has evaluated the effectiveness of its internal control over financial reporting as of December 31, 2015, based on
the criteria established in a report entitled “Internal Control - Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission” and the interpretive guidance issued by the Commission in Release No. 34-55929.
Based on this evaluation, the Company’s management, including the Company’s principal executive officer and principal
financial officer, has evaluated and concluded that the Company’s internal control over financial reporting was ineffective
as of December 31, 2015, and identified the following material weaknesses:



|• |  | There are insufficient written policies and procedures to insure the correct application
of accounting and financial reporting with respect to the current requirements of GAAP and SEC disclosure requirements; and Notwithstanding
the existence of this material weakness in our internal control over financial reporting, our management believes that the consolidated
financial statements included in its reports fairly present in all material respects the Company’s financial condition,
results of operations and cash flows for the periods presented.
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



This annual report does
not include an attestation report of the Company’s independent registered public accounting firm regarding internal control
over financial reporting. The Company’s registered public accounting firm was not required to issue an attestation on its
internal controls over financial reporting pursuant to temporary rules of the Securities and Exchange Commission. The Company
will continue to evaluate the effectiveness of internal controls and procedures on an on-going basis.



c) Changes in Internal Control over Financial Reporting



There were no changes
in our internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, during our
most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal
control over financial reporting.



Table of Contents35







Item 9B. Other Information.



Not applicable.



Item 10. Directors, Executive Officers, and Corporate Governance.



The following table sets forth the names and ages of the
members of the Company’s Board of Directors (the “Board”) and executive officers, and the positions held by
each:



|Name (1)(2)(3)     |  |  |    | Position
|------------------ |  |  | -- | --------
|Shawn E. Leon      |  |  | 56 |         
|                   |  |  |    |         
|John O’Bireck(5)   |  |  | 57 |         
|                   |  |  |    |         
|Gerald T Miller(5) |  |  | 58 |         



|(1) |  | Michael Hewlett resigned as a director of the Company, without cause, with effect
from June 15, 2015
|--- |  | ----------------------------------------------------------------------------------------------------

|(2) |  | Dr. Luke Fazio resigned as a director of the company, without cause, with effect from
June 17, 2015.
|--- |  | ----------------------------------------------------------------------------------------------------

|(3) |  | Mr William Sklar resigned as the Chief Financial Officer of the Company with effect
from August 19,2015.
|--- |  | --------------------------------------------------------------------------------------------------------

|(4) |  | Mr. Leon was appointed as the Chief Financial Officer of the Company upon the resignation
of Mr. William Sklar on August 19, 2015.
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------

|(5) |  | Mr. O’Bireck and Mr. Miller were appointed to the board of directors on November
2, 2015 to replace the vacancies left by Mr. Hewlett and Dr. Fazio.
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------



Set forth below is a brief description of the
background and business experience of each of our current executive officers and directors.



Shawn E. Leon, Chief Executive Officer, Chief Financial Officer, President and Director



Shawn E. Leon has been an officer
and director of the Company since November 2010 and served as the President of the Company’s subsidiaries at all times.
In April 2011, Mr. Leon was appointed as the Company’s Chief Executive Officer. Prior to joining the Company, Mr. Leon held
the role of President of Greenestone Clinic Inc., Leon Developments Ltd, Port Carling Inn Developments Ltd., 1871 at the Locks
Developments Ltd. and Leon Developments Ltd. Mr. Leon graduated with Honors in Business Administration from Wilfrid Laurier University
in 1982. Mr. Leon was elected to the Board because of his prior management  experience.



John O’Bireck, Director



John O’Bireck, 57 of Aurora,
Ontario, Canada has been a Control Systems Engineer, since graduating in 1982, and has since been involved with building engineering
teams to provide solutions for industrial and transportation industry. He was a co-founder of Hay-Drive Technologies Ltd. a publicly
listed company where he held the positions of Director, Vice-President, Chief Technology Officer and Vice President of Advanced
Product Development. Mr. O’Bireck was also the co-founder, Director and President of Supernova Performance Technologies Ltd.,
a privately held company. In 2014 Mr. O’Bireck was elected as a Director to the Board of Sparta Capital Ltd.



Gerald T. Miller, Director



Gerry Miller, 58 of Toronto, Ontario, Canada is the Managing Partner of the Law Firm
Gardiner Miller Arnold LLP. Mr. Miller’s practice focuses on a comprehensive range of business, finance and real estate
issues. In addition to managing the law firm. Mr. Miller’s runs the business law and real estate practice at Gardiner Miller
Arnold LLP Law firm.  He advises small to medium sized companies in manufacturing, investing and service related industries. 
Mr. Miller supervises all merger and acquisition transactions and institutional finance work.

Table of Contents36







Involvement in Certain Legal Proceedings



To the best of our knowledge,
during the past ten years, none of the following occurred with respect to a present or former director, executive officer, or
employee: (1) any bankruptcy petition filed by or against any business of which such person was a general partner or executive
officer either at the time of the bankruptcy or within two years prior to that time; (2) any conviction in a criminal proceeding
or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses); (3) being subject to
any order, judgment or decree, not subsequently reversed, suspended vacated, of any court of competent jurisdiction, permanently
or temporarily enjoining, barring, suspending or otherwise limiting his or her involvement in any type of business, securities
or banking activities; and (4) being found by a court of competent jurisdiction (in a civil action), the SEC or the Commodities
Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed,
suspended or  vacated.



Compliance with Section 16(A) of the Exchange Act



Section 16(a) of the Exchange
Act requires the Company’s directors, executive officers and persons who beneficially own 10% or more of a class of securities
registered under Section 12 of the Exchange Act to file reports of beneficial ownership and changes in beneficial ownership with
the SEC. Directors, executive officers and greater than 10% stockholders are required by the rules and regulations of the SEC
to furnish the Company with copies of all reports filed by them in compliance with Section 16(a).



Based solely on our review
of certain reports filed with the SEC pursuant to Section 16(a) of the Securities Exchange Act of 1934, as amended, at December
31, 2015, none of the officers, directors or 10% shareholders were in compliance with Section 16(a).



Code of Ethics



The Board adopted a Code
of Business Conduct and Ethics applicable to all of our directors, officers and employees, including our Chief Executive Officer.
A copy of our Code of Ethics is incorporated by reference to an exhibit in our exhibit table. Shareholders may also request a
copy of the Code of Ethics from the Company’s headquarters.



Board Meetings and Committees



The Company holds regular
Board meetings each quarter. There are no sub committees of the Board. All Directors act on all matters before the Board.



Audit Committee



Effective May 6, 2003, the
SEC adopted rules that require that before our auditor is engaged by us to render any auditing or permitted non-audit related
service, the engagement be:



|• |  | approved by our audit committee; or
|- |  | -----------------------------------

|• |  | entered into pursuant to pre-approval policies and procedures established by the audit
committee, provided the policies and procedures are detailed as to the particular service, the audit committee is informed of
each service, and such policies and procedures do not include delegation of the audit committee’s responsibilities to management.
|- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



We do not currently have an audit committee. The Board pre-approves all services provided
by our independent auditors and otherwise performs the functions of an audit committee. The Company does not believe that not
having an audit committee will have any adverse effect on the Company’s financial statements or current operations. The
Company’s management will assess whether an audit committee may be necessary in the future.

Table of Contents37







Item 11. Executive Compensation. Executive Compensation



There has been no annuity,
pension or retirement benefits paid to our officers or directors during the past two fiscal years. We currently do not have an
employment agreement with the Company’s Chief Executive Officer.



On November 1, 2014, the
Company entered into an employment agreement with William L. Sklar, our Chief Financial Officer. Pursuant to this employment
agreement, Mr. Sklar is entitled to a salary of CAD$18,000 per annum and he received options exercisable over 480,000 shares of
common stock of the Company at an exercise price of $0.12 per share. The stock option vest over a twenty-four-month period, contain
a cashless exercise provision and will expire on October 31, 2019. Mr. Sklar was subject to a two year non-compete and non-solicitation
clause under his employment agreement. Mr. Sklar’s employment agreement did not provide for any payments upon a change of
control. Mr Sklar resigned as the Company’s Chief Financial Officer on August 19, 2015.



The table below summarizes all compensation awarded to, earned by, or paid to each named
executive officer for our last two completed fiscal years for all services rendered to us.



SUMMARY COMPENSATION TABLE

|Name and principal position                                     |  | Year |      | Salary ($) |  | Bonus ($) |       | Stock
                                         Awards ($) |  | Option
                                         Awards ($) |   | Non-Equity
                                         Incentive Plan Compensation
                                                           ($) |  | Nonqualified
                                         Deferred Compensation Earnings ($) |   | All Other Compensation ($) |  | Total
                                         ($)
|--------------------------------------------------------------- |  | ---- | ---- | ---------- |  | --------- | ----- | --------------------------------------------------------- |  | ---------------------------------------------------------- | - | ---------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------------------------------------------------------------------- | - | -------------------------- |  | --------------------------------------------------
|Shawn E. Leon, Chief Executive Officer, Chief Financial Officer |  |      | 2015 |            |  |           | —     |                                                           |  |                                                            | — |                                                                                                                                                |  |                                                                                          | — |                            |  |                                                   
|President (1)                                                   |  |      | 2014 |            |  |           | —     |                                                           |  |                                                            | — |                                                                                                                                                |  |                                                                                          | — |                            |  |                                                   
|                                                                |  |      |      |            |  |           |       |                                                           |  |                                                            |   |                                                                                                                                                |  |                                                                                          |   |                            |  |                                                   
|William L. Sklar Chief Financial Officer (2)                    |  |      | 2015 |            |  |           | 5,840 |                                                           |  |                                                            | — |                                                                                                                                                |  |                                                                                          | — |                            |  |                                                   
|Financial                                                       |  |      | 2014 |            |  |           | 3,879 |                                                           |  |                                                            | — |                                                                                                                                                |  |                                                                                          | — |                            |  |                                                   





|(1) |  | Mr Leon was appointed as the Company’s Chief Financial Officer on August 19,
2015.
|--- |  | ----------------------------------------------------------------------------------

|(2) |  | Mr. Sklar resigned as the Company’s Chief Financial Officer on August 19, 2015.
|--- |  | -------------------------------------------------------------------------------



Outstanding Equity Awards at Fiscal Year End



There were no equity awards issued to executive officers during the fiscal year
ended December 31, 2015 and there are no outstanding equity awards to named officers as of December 31, 2015.



Table of Contents38







Information regarding equity compensations
plans is set forth in the table below:



|Plan category                                              |  | Number
                                         of securities to be issued upon exercise of outstanding options |         | Weighted
                                         average exercise price of outstanding options |  | Number of securities available for future issuance under equity compensation
    plans
|---------------------------------------------------------- |  | --------------------------------------------------------------------------------------------------------------- | ------- | ----------------------------------------------------------------------------------------------- |  | --------------------------------------------------------------------------------------
|Equity compensation plans approved by security holders     |  |                                                                                                                 | 480,000 |                                                                                                 |  |                                                                                       
|                                                           |  |                                                                                                                 |         |                                                                                                 |  |                                                                                       
|Equity compensation plans not approved by security holders |  |                                                                                                                 | —       |                                                                                                 |  |                                                                                       
|                                                           |  |                                                                                                                 |         |                                                                                                 |  |                                                                                       
|Total                                                      |  |                                                                                                                 | 480,000 |                                                                                                 |  |                                                                                       





Directors Compensation



The following summary compensation table
sets forth all compensation awarded to, earned by, or paid to the named directors by us during the year ended December 31,  2014.



DIRECTORS COMPENSATION TABLE



|Director           |  |  | Directors fees Earned or Paid in Cash ($) |  |  |  | Stock Awards ($) |  |  |  | Option Awards ($) |  |  |  | Non-Equity Incentive Plan Compensation ($) |  |  |  | Non-Qualified Deferred Compensation Earnings ($) |  |  |  | All Other Compensation ($) |  |  |  | Total ($) | 
|------------------ |  |  | ----------------------------------------- |  |  |  | ---------------- |  |  |  | ----------------- |  |  |  | ------------------------------------------ |  |  |  | ------------------------------------------------ |  |  |  | -------------------------- |  |  |  | --------- | 
|                   |  |  |                                           |  |  |  |                  |  |  |  |                   |  |  |  |                                            |  |  |  |                                                  |  |  |  |                            |  |  |  |           | 
|Shawn E. Leon      |  |  | —                                         |  |  |  | —                |  |  |  | —                 |  |  |  | —                                          |  |  |  | —                                                |  |  |  | —                          |  |  |  | —         | 
|                   |  |  |                                           |  |  |  |                  |  |  |  |                   |  |  |  |                                            |  |  |  |                                                  |  |  |  |                            |  |  |  |           | 
|John O’Bireck(5)   |  |  | —                                         |  |  |  | —                |  |  |  | —                 |  |  |  | —                                          |  |  |  | —                                                |  |  |  | —                          |  |  |  | —         | 
|                   |  |  |                                           |  |  |  |                  |  |  |  |                   |  |  |  |                                            |  |  |  |                                                  |  |  |  |                            |  |  |  |           | 
|Gerald T Miller(5) |  |  | —                                         |  |  |  | —                |  |  |  | —                 |  |  |  | —                                          |  |  |  | —                                                |  |  |  | —                          |  |  |  | —         | 
|                   |  |  |                                           |  |  |  |                  |  |  |  |                   |  |  |  |                                            |  |  |  |                                                  |  |  |  |                            |  |  |  |           | 
|Dr. Luke Fazio     |  |  | —                                         |  |  |  | —                |  |  |  | —                 |  |  |  | —                                          |  |  |  | —                                                |  |  |  | —                          |  |  |  | —         | 
|                   |  |  |                                           |  |  |  |                  |  |  |  |                   |  |  |  |                                            |  |  |  |                                                  |  |  |  |                            |  |  |  |           | 
|Michael Howlett    |  |  | —                                         |  |  |  | —                |  |  |  | —                 |  |  |  | —                                          |  |  |  | —                                                |  |  |  | —                          |  |  |  | —         | 





Item 12. Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters.



The following table sets forth the beneficial ownership of our capital stock by each
executive officer and director, by each person known by us to beneficially own more than five percent (5%) of any class of stock
and by the executive officers and directors as a group. Except as otherwise indicated, all shares of common stock are owned directly
and the percentage shown is based on 47,738,855 shares of common Stock issued and outstanding as of April 10, 2016.



Table of Contents39







|Name                                              |  | Amount and Nature of Beneficial Ownership of
    Common Stock |           | Percent
                                         of Common Stock Beneficially Owned (1(2))
|------------------------------------------------- |  | ------------------------------------------------------------- | --------- | ------------------------------------------------------------------------------------------
|                                                  |  |                                                               |           |                                                                                           
|Directors and officers                            |  |                                                               |           |                                                                                           
|Shawn E. Leon                                     |  |                                                               | 8,005,150 | (3)                                                                                       
|                                                  |  |                                                               |           |                                                                                           
|John O’Bireck                                     |  |                                                               | —         |                                                                                           
|                                                  |  |                                                               |           |                                                                                           
|Gerald T Miller                                   |  |                                                               | —         |                                                                                           
|                                                  |  |                                                               |           |                                                                                           
|5% Shareholders                                   |  |                                                               |           |                                                                                           
|Irwin Zalcberg                                    |  |                                                               | 5,300,000 | (4)                                                                                       
|                                                  |  |                                                               |           |                                                                                           
|All officers and directors as a group (3 persons) |  |                                                               | 8,005,150 |                                                                                           



|(1) |  | Based on 47,738,855 shares of common stock outstanding as of April 6, 2016.
|--- |  | ---------------------------------------------------------------------------

|(2) |  | Beneficial ownership means the sole or shared power to vote, or to direct the voting
of, a security, or the sole or shared investment power with respect to a security (i.e., the power to dispose of, or to direct
the disposition of, a security). In addition, for purposes of this table, a person is deemed, as of any date, to have “beneficial
ownership” of any security that such person has the right to acquire within 60 days of April 6, 2015.
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) |  | Includes 1,910,000 shares of common stock held by Eileen Greene, the spouse of Shawn
Leon, 2,687,300 shares of common stock held by GreeneStone Clinic Inc., which is controlled by Mr. Leon and warrants exercisable
over 1,150,000 shares of common stock held by Eileen Greene. Mr. Leon resides at 46 Fairway Heights Drive, Thornhill, Ontario,
Canada.
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) |  | Includes 2,300,000 shares of common stock held by Irwin L. Zalcberg, warrants exercisable
over 1,000,000 shares of common stock and further warrants exercisable over 2,000,000 shares of common stock owned by the Irwin
Zalcberg profit sharing plan.
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Item 13. Certain Relationships and Related Party Transactions, and Director
Independence.



Related Party Transactions



The Company leases the premises
on which the clinic is situated on from Cranberry Cove Holdings, LTD, which is owned by our CEO, Shawn Leon. The clinic is in
Bala, Ontario at 3571 Highway 169. The property is 43 acres in size and contains approximately 48,000 square feet of buildings.
The initial term of the lease is for a five-year period which commenced on April 1, 2014 and has renewal options for an additional
three terms, each additional term being for a period of three years. The lease is a net lease and the Company has a non-disturbance
agreement from the mortgage lenders on the property for the whole term. Further, the Company has an option to purchase the property
at any time during the term of the lease for $10,000,000. Shawn Leon, the Company’s Chief Executive Officer is also the
managing partner of Cranberry Cove Holdings LTD.



Table of Contents40







As of December 31, 2015, a total of $394,297 is owed to
executive officers or their affiliates for loans payable, as detailed in the below table:



|Description                      |  | Amount
|-------------------------------- |  | ------
|                                 |  |       
|Shawn Leon(1)                    |  | $     
|                                 |  |       
|1816191 Ontario(2)               |  |       
|                                 |  |       
|Greenestone Clinic(3)            |  |       
|                                 |  |       
|Cranberry Cove Holdings LTD. (4) |  |       
|                                 |  |       
|                                 |  | $     

(1) Shawn E. Leon is the Company’s Chief Executive
Officer.

(2) 1816191 Ontario is the Endoscopy Clinic sold to Dr. Parekh in December 2014. Dr. Parekh is indebted to the company for $446,476 as of December 31, 2015, this amount has been fully provided for.

(3) Shawn Leon is the Chief Executive Officer of GreeneStone Clinic, Inc.

(4) Dr. Parekh, the owner of 1816191 Ontario, is the owner of Cranberry Cove
Holdings LTD.



The Company’s management fee expense amounted
to $96,705 and $122,271 for the years ended December 31, 2015 and 2014 which fees were paid to Greenestone Clinic Inc. for services
which are included in management fees.



The Company entered into an agreement to lease premises from Cranberry Cove Holdings
Ltd. On an arm’s length basis. During the year ended December 31, 2015, the Company had rent expense of $255,020  to Cranberry
Cove Holdings Ltd. Cranberry Cove Holdings Ltd. is related to the Company by virtue of its shareholder being a director of the
Company.



Director Independence



The common stock of the
Company is currently quoted on the OTCBB, a quotation system which currently does not have director independence requirements.
On an annual basis, each director and executive officer will be obligated to disclose any transactions with the Company in which
a director or executive officer, or any member of his or her immediate family, have a direct or indirect material interest in
accordance with Item 407(a) of Regulation S-K. Following completion of these disclosures, the Board will make an annual determination
as to the independence of each director using the current standards for “independence” that satisfy the criteria for
the NASDAQ Stock Market, Inc.



As of December 31, 2015, the Board determined that the following directors are independent
under these standards: John O’Bireck and Gerald T Miller.



Item 14. Principal Accountant Fees and Services.



The following is a summary
of the fees paid by us to RBSM LLP for professional services rendered for the years ended December 31, 2015 and 2014:



|Fee Category       |  |  | December 31, 2015 |        | December 31, 2014
|------------------ |  |  | ----------------- | ------ | -----------------
|                   |  |  |                   |        |                  
|Audit fees         |  |  | $                 | 66,000 |                  
|Audit related fees |  |  |                   | —      |                  
|Taxation fees      |  |  |                   | —      |                  
|All other fees     |  |  |                   | —      |                  
|                   |  |  | $                 | 66,000 |                  



Table of Contents41







Audit Fees



Consists of fees billed
for professional services rendered for the audit of our financial statements and review of interim financial statements included
in quarterly reports and services that are normally provided by RBSM LLP in connection with statutory and regulatory filings or
engagements in fiscal year ended December 31, 2015 and 2014, respectively.



Audit Related Fees



Consists of fees billed
for accounting, assurance and related services that are reasonably related to the performance of the audit or review of our financial
statements and are not reported under “Audit Fees”.



Tax Fees



Tax Fees consist of the
aggregate fees billed for professional services rendered by our principal accounts for tax compliance, tax advice, and tax planning.
These services include preparation for federal and state income tax returns.



All Other Fees



We did not incur any other
fees billed by auditors for services rendered to our Company, other than the services listed above for the fiscal years ended
December 31, 2015 and 2014, respectively.



Table of Contents42





PART IV



Item 15. Exhibits, Financial Statement Schedules.



(a)Financial Statements and Schedules



See Item 8.



(b)Exhibits



| | Exhibit No. |  |  | Description                                                                                                                                                           |  |  | Form |  |  |  | SEC File No. Date |  |  |  | Exhibit |  |  |  | Filing            |  |  | Filed Herewith |  | Furnished Herewith
| | ----------- |  |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  |  | ---- |  |  |  | ----------------- |  |  |  | ------- |  |  |  | ----------------- |  |  | -------------- |  | ------------------
| | 3.1         |  |  | Articles of Incorporation of NNRC, Inc.  (as filed with the Secretary of State of Colorado on April 1, 1993)                                                          |  |  | 10-K |  |  |  | 000-15078         |  |  |  | 3.1     |  |  |  | March 28, 2013    |  |  |                |  |                   
| |             |  |  |                                                                                                                                                                       |  |  |      |  |  |  |                   |  |  |  |         |  |  |  |                   |  |  |                |  |                   
| | 3.2         |  |  | Articles of Amendment to the Articles of Incorporation of Nova Natural Resources, Inc. (as
    filed with the Secretary of State of Colorado on May 8, 2012)          |  |  | 10-K |  |  |  | 000-15078         |  |  |  | 3.2     |  |  |  | March 28, 2013    |  |  |                |  |                   
| |             |  |  |                                                                                                                                                                       |  |  |      |  |  |  |                   |  |  |  |         |  |  |  |                   |  |  |                |  |                   
| | 3.3         |  |  | Articles of Amendment to the Articles of Incorporation of Greenestone Healthcare Corporation
    (as filed with the Secretary of State of Colorado on March 26, 2013) |  |  | 8-K  |  |  |  | 000-15078         |  |  |  | 3.3     |  |  |  | March 29, 2013    |  |  |                |  |                   
| |             |  |  |                                                                                                                                                                       |  |  |      |  |  |  |                   |  |  |  |         |  |  |  |                   |  |  |                |  |                   
| | 3.4         |  |  | Amended and Restated Bylaws of Greenestone Healthcare Corporation                                                                                                     |  |  | 8-K  |  |  |  | 000-15078         |  |  |  | 3.4     |  |  |  | March 29, 2013    |  |  |                |  |                   
| |             |  |  |                                                                                                                                                                       |  |  |      |  |  |  |                   |  |  |  |         |  |  |  |                   |  |  |                |  |                   
| | 10.1        |  |  | Stock Purchase Agreement I                                                                                                                                            |  |  | 8-K  |  |  |  | 000-15078         |  |  |  | 10.01   |  |  |  | March 29, 2013    |  |  |                |  |                   
| |             |  |  |                                                                                                                                                                       |  |  |      |  |  |  |                   |  |  |  |         |  |  |  |                   |  |  |                |  |                   
| | 10.2        |  |  | Form of Warrant I                                                                                                                                                     |  |  | 8-K  |  |  |  | 000-15078         |  |  |  | 10.01   |  |  |  | December 30, 2013 |  |  |                |  |                   
| |             |  |  |                                                                                                                                                                       |  |  |      |  |  |  |                   |  |  |  |         |  |  |  |                   |  |  |                |  |                   
| | 10.3        |  |  | Form of Warrant II                                                                                                                                                    |  |  | 8-K  |  |  |  | 000-15078         |  |  |  | 10.01   |  |  |  | December 30, 2013 |  |  |                |  |                   
| |             |  |  |                                                                                                                                                                       |  |  |      |  |  |  |                   |  |  |  |         |  |  |  |                   |  |  |                |  |                   
| | 10.4        |  |  | Stock Purchase Agreement II                                                                                                                                           |  |  | 8-K  |  |  |  | 000-15078         |  |  |  | 10.01   |  |  |  | December 30, 2013 |  |  |                |  |                   
| |             |  |  |                                                                                                                                                                       |  |  |      |  |  |  |                   |  |  |  |         |  |  |  |                   |  |  |                |  |                   
| | 10.5        |  |  | Share Purchase Agreement,     dated as of December 16, 2014, by and between the
    Registrant    and    Jain
    heel    Parekh   Medicine Professional Corporation  |  |  | 8-K  |  |  |  | 000-15078         |  |  |  | 10.1    |  |  |  | December 23,2014  |  |  |                |  |                   
| |             |  |  |                                                                                                                                                                       |  |  |      |  |  |  |                   |  |  |  |         |  |  |  |                   |  |  |                |  |                   
|

Table of Contents43





| | 10.6    |  |  | Collateral Note,dated December
16,2014                                                                                                                      |  |  | 8-K |  |  |  | 000-15078 |  |  |  | 10.2 |  |  |  | December 23, 2014 |  |  |   |  |  
| | ------- |  |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------- |  |  | --- |  |  |  | --------- |  |  |  | ---- |  |  |  | ----------------- |  |  | - |  | -
| |         |  |  |                                                                                                                                                             |  |  |     |  |  |  |           |  |  |  |      |  |  |  |                   |  |  |   |  |  
| | 16.1    |  |  | Letter from Jarvis RyanAssociates,LLP                                                                                                                       |  |  | 8-K |  |  |  | 000-15078 |  |  |  | 16.1 |  |  |  | July 9, 2014      |  |  |   |  |  
| |         |  |  |                                                                                                                                                             |  |  |     |  |  |  |           |  |  |  |      |  |  |  |                   |  |  |   |  |  
| | 31.1    |  |  | Certification by the Principal Executive Officer of registrant pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Rule 13a-14(a) or Rule15d-14(a))  |  |  |     |  |  |  |           |  |  |  |      |  |  |  |                   |  |  | X |  |  
| |         |  |  |                                                                                                                                                             |  |  |     |  |  |  |           |  |  |  |      |  |  |  |                   |  |  |   |  |  
| | 31.2    |  |  | Certification by the Principal Financial Officer of registrant pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Rule 13a-14(a) or Rule 15d-14(a)) |  |  |     |  |  |  |           |  |  |  |      |  |  |  |                   |  |  | X |  |  
| |         |  |  |                                                                                                                                                             |  |  |     |  |  |  |           |  |  |  |      |  |  |  |                   |  |  |   |  |  
| | 32.1    |  |  | Certification by the Principal Executive Officer pursuant to 18 U.S.C. 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002            |  |  |     |  |  |  |           |  |  |  |      |  |  |  |                   |  |  | X |  |  
| |         |  |  |                                                                                                                                                             |  |  |     |  |  |  |           |  |  |  |      |  |  |  |                   |  |  |   |  |  
| | 32.2    |  |  | Certification by the Principal Financial Officer pursuant to 18 U.S.C. 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002            |  |  |     |  |  |  |           |  |  |  |      |  |  |  |                   |  |  | X |  |  
| |         |  |  |                                                                                                                                                             |  |  |     |  |  |  |           |  |  |  |      |  |  |  |                   |  |  |   |  |  
| | 101.INS |  |  | INS XBRLInstanceDocument                                                                                                                                    |  |  |     |  |  |  |           |  |  |  |      |  |  |  |                   |  |  |   |  | X
| |         |  |  |                                                                                                                                                             |  |  |     |  |  |  |           |  |  |  |      |  |  |  |                   |  |  |   |  |  
| | 101.SCH |  |  | SCH XBRLSchemaDocument                                                                                                                                      |  |  |     |  |  |  |           |  |  |  |      |  |  |  |                   |  |  |   |  | X
| |         |  |  |                                                                                                                                                             |  |  |     |  |  |  |           |  |  |  |      |  |  |  |                   |  |  |   |  |  
| | 101.CAL |  |  | CAL XBRL CalculationLinkbaseDocument                                                                                                                        |  |  |     |  |  |  |           |  |  |  |      |  |  |  |                   |  |  |   |  | X
| |         |  |  |                                                                                                                                                             |  |  |     |  |  |  |           |  |  |  |      |  |  |  |                   |  |  |   |  |  
| | 101.DEF |  |  | DEF XBRL DefinitionLinkbaseDocument                                                                                                                         |  |  |     |  |  |  |           |  |  |  |      |  |  |  |                   |  |  |   |  | X
| |         |  |  |                                                                                                                                                             |  |  |     |  |  |  |           |  |  |  |      |  |  |  |                   |  |  |   |  |  
| | 101.LAB |  |  | LAB XBRL LabelLinkbaseDocument                                                                                                                              |  |  |     |  |  |  |           |  |  |  |      |  |  |  |                   |  |  |   |  | X
| |         |  |  |                                                                                                                                                             |  |  |     |  |  |  |           |  |  |  |      |  |  |  |                   |  |  |   |  |  
| | 101.PRE |  |  | PRE XBRL PresentationLinkbaseDocument                                                                                                                       |  |  |     |  |  |  |           |  |  |  |      |  |  |  |                   |  |  |   |  | X







Table of Contents44





SIGNATURE



Pursuant to the requirements of Section 13 or
15(d) of the Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.



GREENESTONE HEALTHCARE
CORP.





|Date: April 14, 2016 |  | By: /s/ Shawn E. Leon                                                                                                   
|-------------------- |  | ------------------------------------------------------------------------------------------------------------------------
|                     |  | Name: Shawn E. Leon                                                                                                     
|                     |  | Title: Chief Executive Officer and Chief Financial Officer (Principal Executive Officer and Principal Financial Officer)



Pursuant to the requirements of the Securities
Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities
and on the dates indicated.





|Name                 | Position                                               | Date          
|-------------------- | ------------------------------------------------------ | --------------
|                     |                                                        |               
|/s/Shawn E. Leon     | Chief Executive Officer (Principal Executive
Officer), | April 14, 2016
|Shawn Leon           | Chief Financial Officer (Principal
Financial Officer), |               
|                     | President and Director                                 |               
|                     |                                                        |               
|/s/ John O’Bireck    | Director                                               | April 14, 2016
|John O’Bireck        |                                                        |               
|                     |                                                        |               
|/s/ Gerald T. Miller | Director                                               | April 14, 2016
|Gerald T. Miller     |                                                        |               



Table of Contents45