Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | May 04, 2020 | |
Document And Entity Information | ||
Entity Registrant Name | CQENS Technologies Inc. | |
Entity Central Index Key | 0001479915 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2020 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 25,123,458 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2020 |
Balance Sheets
Balance Sheets - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Current Assets | ||
Cash and cash equivalents | $ 1,007,326 | $ 1,298 |
Prepaid expenses | 3,385 | 1,553 |
Total Current Assets | 1,010,711 | 2,851 |
Intellectual property, net | 285,907 | 290,346 |
TOTAL ASSETS | 1,296,618 | 293,197 |
Current Liabilities | ||
Accounts payable | 119,892 | 10,722 |
Compensation payable | 25,000 | |
Accrued expenses | 7,931 | 6,865 |
Interest payable | 48,232 | |
Note payable | 50,000 | |
Convertible note | 40,000 | |
Loan from related party | 705,544 | 703,044 |
Total Current Liabilities | 858,367 | 858,863 |
TOTAL LIABILITIES | 858,367 | 858,863 |
STOCKHOLDERS' EQUITY (DEFICIT) | ||
Common Stock: $0.0001 par value; 200,000,000 shares authorized: 25,101,035 shares issued and outstanding at March 31, 2020 and 24,837,203 issued and outstanding at December 31, 2019 | 2,510 | 2,484 |
Additional paid-in capital | 3,010,791 | 1,733,900 |
Accumulated deficit | (2,575,050) | (2,302,050) |
TOTAL STOCKHOLDERS' EQUITY (DEFICIT) | 438,251 | (565,666) |
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIT) | $ 1,296,618 | $ 293,197 |
Balance Sheets (Parenthetical)
Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares issued | 25,101,035 | 24,837,203 |
Common stock, shares outstanding | 25,101,035 | 24,837,203 |
Statements of Operations (Unaud
Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Operating Expenses | ||
General and administrative | $ 109,547 | $ 7,077 |
Research and development | 130,456 | |
Professional fees | 29,139 | 19,657 |
Total Operating Expenses | 269,142 | 26,734 |
Total Operating Loss | (269,142) | (26,734) |
Other Expense | (3,858) | (2,423) |
Net Loss | $ (273,000) | $ (29,157) |
Basic and diluted loss per common share | $ (0.01) | $ 0 |
Basic and diluted weighted average shares outstanding | 25,013,601 | 10,758,631 |
Statements of Changes in Stockh
Statements of Changes in Stockholders' Equity (Deficit) (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid in Capital [Member] | Accumulated Deficit [Member] | Series A Preferred Stock [Member] | Total |
Balance at Dec. 31, 2018 | $ 1,076 | $ 1,622,728 | $ (2,162,171) | $ 50 | $ (538,317) |
Balance, shares at Dec. 31, 2018 | 10,758,631 | 500,000 | |||
Net loss | (29,157) | (29,157) | |||
Balance at Mar. 31, 2019 | $ 1,076 | 1,622,728 | (2,191,328) | $ 50 | (567,474) |
Balance, shares at Mar. 31, 2019 | 10,758,631 | 500,000 | |||
Balance at Dec. 31, 2019 | $ 2,484 | 1,733,900 | (2,302,050) | (565,666) | |
Balance, shares at Dec. 31, 2019 | 24,837,203 | 0 | |||
Common stock issued for cash | $ 25 | 1,199,975 | 1,200,000 | ||
Common stock issued for cash, shares | 248,448 | ||||
Common stock issued for note payable | $ 1 | 76,916 | 76,917 | ||
Common stock issued for note payable, shares | 15,384 | ||||
Net loss | (273,000) | (273,000) | |||
Balance at Mar. 31, 2020 | $ 2,510 | $ 3,010,791 | $ (2,575,050) | $ 438,251 | |
Balance, shares at Mar. 31, 2020 | 25,101,035 | 0 |
Statements of Cash Flows (Unaud
Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash flows from operating activities | ||
Net loss | $ (273,000) | $ (29,157) |
Adjustments to reconcile net loss to net cash used in operations: | ||
Amortization expense | 5,454 | 4,371 |
Changes in operating assets and liabilities: | ||
Prepaid expenses | (1,832) | (1,238) |
Accounts payable | 109,170 | 2,471 |
Accrued expenses | 1,625 | 6,060 |
Compensation payable | 25,000 | |
Interest payable | (21,874) | 1,973 |
Net cash used in operating activities | (155,457) | (15,520) |
Cash flows from investing activities | ||
Additions to intellectual property | (1,015) | |
Net cash flows from investing activities | (1,015) | |
Cash flows from financing activities | ||
Proceeds from issuance of common stock | 1,200,000 | |
Borrowing on debt with related party | 2,500 | 14,500 |
Repayment of convertible note | (40,000) | |
Net cash provided by financing activities | 1,162,500 | 14,500 |
Net change in cash and cash equivalents | 1,006,028 | (1,020) |
Cash and cash equivalents, beginning of period | 1,298 | 1,477 |
Cash and cash equivalents, end of period | 1,007,326 | 457 |
Supplementary Information | ||
Interest paid | 49,240 | |
Income taxes paid | ||
Supplementary disclosure of non-cash activities: | ||
Common stock issued from conversion of note payable | 50,000 | |
Common Stock issued from conversion of interest payable on note | $ 26,917 |
Nature of Business and Summary
Nature of Business and Summary of Basis of Presentation | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Business and Summary of Basis of Presentation | NOTE 1 - NATURE OF BUSINESS AND SUMMARY OF BASIS OF PRESENTATION Nature of Business CQENS Technologies, Inc., formerly VapAria Corporation (“we”, “our”, “CQENS”, the “Company”) was incorporated under the laws of the State of Delaware on December 21, 2009 originally under the name OICco Acquisition IV, Inc. CQENS Technologies, Inc. is a technology company with a proprietary method of heating plant-based consumable formulations that produce an aerosol that lead to the effective and efficient inhalation of the plant’s constituents. This is accomplished at a high temperature but without the accompanying constituents of combustion. Our system of heating is a high temperature, non-combustion system. Our Heat-not-Burn Tobacco Product (HTP) system is a patent-pending method of heating plant-based consumables for inhalation that is superior to other methods of ingestion, smoking, vaping, swallowing or via topical application. In the first quarter of 2020 the effects of the COVID-19 pandemic began to be felt. While the duration and full impact of the pandemic is unknown at this time, we expect that the pandemic will adversely impact CQENS in several ways. Our business model is dependent upon our ability to enter into strategic partnerships in the future, including alliances with consumer product companies, to enhance and accelerate the development and commercialization of our proposed products. We will also be dependent upon third party manufacturers to produce our proposed products, as well as third party marketing and distribution companies. We believe that our business opportunities are international in nature and include potential partnerships in the UK, the EU and Asia, including the People’s Republic of China. The worldwide pandemic caused by COVID-19 could cause these opportunities to be delayed or significantly limited in their scope should the pandemic continue and /or be prolonged into 2021. We also need to raise additional working capital to provide sufficient funding to bring our proposed products to market. The adverse impact of COVID-19 on the capital markets will make it more difficult for small, pre-revenue companies such as ours to access capital. We will continue to assess the impact of the COVID-19 pandemic on our company, however, at this time we are unable to predict all possible impacts on our company, our operations and our prospects. The Company has limited operations and, while our executive officers devote a substantial amount of their time to the Company, with limited cash compensation, as of March 31, 2020, had no employees. The Company has a fiscal year end of December 31. Basis of Presentation Basis of Presentation Certain information and footnote disclosures included in financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted. It is suggested that these financial statements be read in conjunction with the financial statements and footnotes thereto in the Company’s December 31, 2019 audited financial statements. The results of operations for the period ended March 31, 2020 are not necessarily indicative of the operating results for the full year. Reclassifications Recent Accounting Pronouncements |
Going Concern
Going Concern | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern | NOTE 2 – GOING CONCERN The Company’s financial statements are prepared in accordance with GAAP applicable to a going concern. This contemplates the realization of assets and the liquidation of liabilities in the normal course of business. Currently, the Company has recurring losses, and although has cash in excess of one million dollars, with renewed research and development efforts and with no source of revenue sufficient to cover its operations costs over the next 12 months these may not allow it to continue as a going concern. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The Company will be dependent upon the raising of additional capital. The financial statements do not include any adjustment that might result from the outcome of this uncertainty. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Stockholders' Equity | NOTE 3 – STOCKHOLDERS’ EQUITY On January 29, 2020 we sold 248,448 shares of our common stock for $1,200,000 to a non-U.S. Person in a private transaction. We did not pay a commission or finder’s fee and are using the proceeds for working capital. On March 6, 2020, the holder of the $50,000 note that was entered into on May 30, 2013 agreed to convert the principal and accrued unpaid interest totaling $76,917 into shares of CQENS common stock at $5.00 per share. A total of 15,384 shares were issued as satisfaction of this note. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 4 – RELATED PARTY TRANSACTIONS In the first quarter of 2020 the Company borrowed an additional $2,500 from Xten, a common control entity. The balance outstanding at March 31, 2020 due Xten is $705,544. The loan is unsecured, noninterest bearing and due on demand. We maintain our corporate offices at 5550 Nicollet Avenue, Minneapolis, MN 55419. We lease the premises from 5550 Nicollet, LLC, a company owned by Mr. Chong. In December 2019 we entered into a month-to-month lease that began January 1, 2020 with a monthly rental rate of $775. As of March 31, 2020, $7,750 is due to 5550 Nicollet LLC. In the first quarter of 2020, pursuant to a verbal agreement, Xten provided research and development related expertise and services specific to the HNB technologies, devices and intellectual property. Xten billed the Company $130,456 in the first quarter of 2020. As of March 31, 2020, we owe Xten $112,142 for these services. |
Note Payable
Note Payable | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Note Payable | NOTE 5 – NOTE PAYABLE As of March 31, 2020, the Company no longer has the $50,000 note payable that was originally issued May 30, 2013. On March 6, 2020, this note and accrued unpaid interest, upon agreement by the noteholder, were fully satisfied through the conversion of the principal and accrued interest totaling $76,917 into 15,384 common shares or our stock at a rate of $5.00 per share. No gain or loss was recognized from the conversion of the note to the Company's stock. |
Convertible Note
Convertible Note | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Convertible Note | NOTE 6 – CONVERTIBLE NOTE As of March 31, 2020, the Company no longer has the $40,000 convertible note that was originally issued July 14, 2014 as part of the acquisition of VapAria Solutions. This convertible note matured on December 31, 2019 and on February 10, 2020 we fully satisfied any and all obligations of the convertible note through repayment of the principal and accrued interest of $62,323. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 7 – COMMITMENTS AND CONTINGENCIES Relating to the December 2013 License Agreement with Xten, a common control entity, beginning in the calendar year in which the first licensed products or licensed services takes place, but not prior to January 1, 2015, the Company is required to pay to Chong Corporation, a related entity, a 3% royalty for revenues with a $50,000 annual minimum royalty commitment. The December 31, 2013 License Agreement with Xten also requires us to pay for the costs associated with maintaining the patent applications and patents licensed to us. For the three months ended March 31, 2020 and 2019 Xten did not report that it incurred any costs associated with this December 2013 License Agreement. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 8 – SUBSEQUENT EVENTS On April 13, 2020 we entered into a consulting engagement memorandum with an unrelated third party pursuant to which we engaged this party to identify key Asian resources for our company. As compensation for the services we issued this individual 12,423 shares of our common stock valued at $62,115. The recipient was a non-U.S. person and the issuance was exempt from registration under the Securities Act in reliance on an exemption provided by Regulation S promulgated thereunder. On April 16, 2020 we entered into a consulting engagement memorandum and agreement with an unrelated third party and engaged this individual to provide certain services to us in connection with the further development of certain of our patents. As compensation, upon execution, we issued this individual 10,000 shares of our common stock valued at $50,000 and are obligated to issue him an additional 10,000 shares at such time as additional patents are issued. The recipient was a non-U.S. person and the issuance was exempt from registration under the Securities Act in reliance on an exemption provided by Regulation S promulgated thereunder. On April 27, 2020 we were informed that the United States Patent and Trademark Office (USPTO) has issued a Notice of Allowability in connection with our Heat-not-Burn Device and Method patent application, filed June 28, 2018. A notice of allowance means that the prosecution of the merits is now closed and a United States Letters Patent will issue on or before July 22, 2020. |
Stockholders' Equity (Details N
Stockholders' Equity (Details Narrative) - USD ($) | Mar. 06, 2020 | Jan. 29, 2020 |
Non-U.S. Person [Member] | ||
Number of common stock shares sold | 248,448 | |
Value of common stock shares sold | $ 1,200,000 | |
Holder [Member] | ||
Note amount | $ 50,000 | |
Unpaid interest amount | $ 76,917 | |
Debt conversion price per share | $ 5 | |
Total number of shares issued | 15,384 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Borrowed from related party | $ 2,500 | $ 14,500 | |
Due to related party | 705,544 | $ 703,044 | |
Research and development costs | 130,456 | ||
Xten Capital Group Inc [Member] | |||
Borrowed from related party | 2,500 | ||
Due to related party | 705,544 | ||
Due from related parties | 112,142 | ||
5550 Nicollet LLC [Member] | |||
Due to related party | 7,750 | ||
Rent | $ 775 | ||
HNB Technologies, Devices and Intellectual Property [Member] | |||
Research and development costs | $ 130,456 |
Note Payable (Details Narrative
Note Payable (Details Narrative) - USD ($) | Mar. 06, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Note payable amount | $ 50,000 | ||
Individual [Member] | |||
Note payable amount | $ 50,000 | ||
Notes issuance date | May 30, 2013 | ||
Noteholder [Member] | |||
Common stock issued for conversion of the principal and accrued interest | $ 76,917 | ||
Common stock issued for conversion of the principal and accrued interest, shares | 15,384 | ||
Share issued price per shares | $ 5 |
Convertible Note (Details Narra
Convertible Note (Details Narrative) - USD ($) | Feb. 10, 2020 | Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 |
Unsecured convertible note | $ 40,000 | |||
Repayment of principal and accrued interest | 40,000 | |||
Convertible Note [Member] | VapAria Solutions [Member] | ||||
Unsecured convertible note | $ 40,000 | |||
Notes issuance date | Jul. 14, 2014 | |||
Note maturity date | Dec. 31, 2019 | |||
Repayment of principal and accrued interest | $ 62,323 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) - December 2013 License Agreement [Member] - Xten Capital Group Inc [Member] | Mar. 31, 2020USD ($) |
Percentage of revenues in royalty | 3.00% |
Minimum royalty commitment | $ 50,000 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - Subsequent Event [Member] - Unrelated Third Party [Member] - USD ($) | Apr. 16, 2020 | Apr. 13, 2020 |
Consulting Engagement Memorandum [Member] | ||
Number of shares issued as compensation for service rendered | 12,423 | |
Value of shares issued as compensation for service rendered | $ 62,115 | |
Consulting Engagement Memorandum and Agreement [Member] | ||
Number of shares issued as compensation for service rendered | 10,000 | |
Value of shares issued as compensation for service rendered | $ 50,000 | |
Additional number of shares to be issued for patents issued | 10,000 |