Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2021 | May 12, 2021 | |
Cover [Abstract] | ||
Entity Registrant Name | SOW GOOD INC. | |
Entity Central Index Key | 0001490161 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2021 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Incorporation, State or Country Code | NV | |
Entity's Reporting Status Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity File Number | 000-53952 | |
Entity Interactive Data Current | Yes | |
Entity Common Stock, Shares Outstanding | 3,962,609 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2021 |
CONDENSED BALANCE SHEETS (Unaud
CONDENSED BALANCE SHEETS (Unaudited) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 2,546,113 | $ 1,912,729 |
Investment in Allied Esports Entertainment, Inc | 511,140 | 280,417 |
Prepaid expenses | 53,175 | 56,427 |
Inventory | 456,864 | 141,371 |
Total current assets | 3,567,292 | 2,390,944 |
Property and equipment: | ||
Construction in progress | 2,298,227 | 1,639,690 |
Property and equipment | 535,702 | 497,494 |
Less accumulated depreciation | (7,608) | (2,612) |
Total property and equipment, net | 2,826,321 | 2,134,572 |
Security deposit | 10,000 | 10,000 |
Right-of-use asset | 1,378,133 | 1,394,202 |
Goodwill | 6,411,327 | 6,411,327 |
Total assets | 14,193,073 | 12,341,045 |
Current liabilities: | ||
Accounts payable | 232,222 | 273,862 |
Accounts payable, related party | 0 | 51,253 |
Accrued expenses | 232,096 | 257,806 |
Current portion of operating lease liabilities | 41,353 | 39,870 |
Total current liabilities | 505,671 | 622,791 |
Operating lease liabilities | 1,388,927 | 1,399,868 |
Notes payable | 150,000 | 262,925 |
Total liabilities | 2,044,598 | 2,285,584 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock, $0.001 par value, 20,000,000 shares authorized, no shares issued and outstanding | 0 | 0 |
Common stock, $0.001 par value, 500,000,000 shares authorized, 3,939,439 and 2,742,890 shares issued and outstanding at March 31, 2021 and December 31, 2020, respectively | 3,939 | 2,743 |
Additional paid-in capital | 49,557,882 | 44,748,859 |
Common stock payable, consisting of 11,585 and 535,729 shares at March 31, 2021 and December 31, 2020, respectively | 72,869 | 1,982,197 |
Accumulated deficit | (37,486,215) | (36,678,338) |
Total stockholders' equity | 12,148,475 | 10,055,461 |
Total liabilities and stockholders' equity | $ 14,193,073 | $ 12,341,045 |
CONDENSED BALANCE SHEETS (Paren
CONDENSED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2021 | Dec. 31, 2020 |
Stockholders' equity: | ||
Preferred stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 3,939,439 | 2,742,890 |
Common stock, shares outstanding | 3,939,439 | 2,742,890 |
Common stock payable, shares | 11,585 | 535,729 |
CONDENSED STATEMENTS OF OPERATI
CONDENSED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income Statement [Abstract] | ||
Revenues | $ 0 | $ 0 |
General and administrative expenses | ||
Salaries and benefits | 381,253 | 219,724 |
Salaries and benefits, stock-based | 375,891 | 21,489 |
Professional services | 101,899 | 84,984 |
Other general and administrative expenses | 286,821 | 91,150 |
Total general and administrative expenses | 1,145,864 | 417,347 |
Depreciation and amortization | 4,996 | 271 |
Total operating expenses | 1,150,860 | 417,618 |
Net operating loss | (1,150,860) | (417,618) |
Other income (expense): | ||
Interest expense, including $13,795 of warrants issued as a debt discount for the three months ending March 31, 2020 | (1,512) | (15,109) |
Gain on early extinguishment of debt | 113,772 | 0 |
Gain (loss) on investment in Allied Esports Entertainment, Inc. | 230,723 | (2,212,852) |
Total other income (expense) | 342,983 | (2,227,961) |
Net loss | $ (807,877) | $ (2,645,579) |
Weighted average common shares outstanding - basic and fully diluted | 3,661,760 | 1,600,424 |
Net loss per common share - basic and fully diluted | $ (0.22) | $ (1.65) |
CONDENSED STATEMENTS OF OPERA_2
CONDENSED STATEMENTS OF OPERATIONS (Unaudited) (Parenthetical) | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Income Statement [Abstract] | |
Warrants issued as a debt discount | $ 13,795 |
STATEMENTS OF CHANGES IN STOCKH
STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid-In Capital | Common Stock Payable | Accumulated Deficit | Total |
Beginning balance, shares at Dec. 31, 2019 | 1,600,464 | ||||
Beginning balance, value at Dec. 31, 2019 | $ 1,600 | $ 37,054,503 | $ (31,357,399) | $ 5,698,704 | |
Common stock options granted to employees and directors for services | 21,489 | 21,489 | |||
Common stock warrants granted to employees and directors for personal guaranty on debt | 265,000 | 265,000 | |||
Net income attributable to Sow Good, Inc. | (2,645,579) | (2,645,579) | |||
Ending balance, shares at Mar. 31, 2020 | 1,600,464 | ||||
Ending balance, value at Mar. 31, 2020 | $ 1,600 | 37,340,992 | (34,002,978) | 3,339,614 | |
Beginning balance, shares at Dec. 31, 2020 | 2,742,890 | ||||
Beginning balance, value at Dec. 31, 2020 | $ 2,743 | 44,748,859 | 1,982,197 | (36,678,338) | 10,055,461 |
Common stock issued for the purchase of S-FDF, LLC assets, shares | 500,973 | ||||
Common stock issued for the purchase of S-FDF, LLC assets, value | $ 501 | 1,853,099 | (1,853,600) | ||
Common stock sales for cash to officers and directors, shares | 225,000 | ||||
Common stock sales for cash to officers and directors, value | $ 225 | 899,775 | 900,000 | ||
Common stock sales for cash, shares | 406,250 | ||||
Common stock sales for cash, value | $ 406 | 1,624,594 | 1,625,000 | ||
Common stock issued to officers and directors for services, shares | 64,326 | ||||
Common stock issued to officers and directors for services, value | $ 64 | 310,334 | (55,728) | 254,670 | |
Common stock options granted to officers and directors for services | 105,172 | 105,172 | |||
Common stock options granted to employees and directors for services | 16,049 | 16,049 | |||
Net income attributable to Sow Good, Inc. | (807,877) | (807,877) | |||
Ending balance, shares at Mar. 31, 2021 | 3,939,439 | ||||
Ending balance, value at Mar. 31, 2021 | $ 3,939 | $ 49,557,882 | $ 72,869 | $ (37,486,215) | $ 12,148,475 |
CONDENSED STATEMENTS OF CASH FL
CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net loss | $ (807,877) | $ (2,645,579) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 4,996 | 271 |
(Gain) loss on investment in Allied Esports Entertainment, Inc. | (230,723) | 2,212,852 |
Gain on early extinguishment of debt | (113,772) | 0 |
Common stock issued to officers and directors for services | 254,670 | 0 |
Amortization of stock options | 121,221 | 21,489 |
Amortization of stock warrants issued as a debt discount | 0 | 13,795 |
Decrease (increase) in current assets: | ||
Accounts receviable, related party | 0 | 505 |
Prepaid expenses | 3,252 | 8,547 |
Inventory | (315,493) | 0 |
Right-of-use asset | 16,069 | 0 |
Increase (decrease) in current liabilities: | ||
Accounts payable | (92,893) | 45,641 |
Accrued expenses | (24,863) | 20,820 |
Lease liabilities | (9,458) | 0 |
Net cash used in operating activities | (1,194,871) | (321,659) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchase of property and equipment | (38,208) | 0 |
Cash paid for construction in progress | (658,537) | 0 |
Net cash provided by investing activities | (696,745) | 0 |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds received from notes payable | 0 | 387,100 |
Repayments on notes payable | 0 | (122,100) |
Proceeds received from the sale of common stock | 2,525,000 | 0 |
Net cash provided by financing activities | 2,525,000 | 265,000 |
NET CHANGE IN CASH AND CASH EQUIVALENTS | 633,384 | (56,659) |
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 1,912,729 | 108,756 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | 2,546,113 | 52,097 |
SUPPLEMENTAL INFORMATION: | ||
Interest paid | 0 | 0 |
Income taxes paid | 0 | 0 |
NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
Value of debt discounts attributable to warrants | $ 0 | $ 265,000 |
1. Organization and Nature of B
1. Organization and Nature of Business | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Nature of Business | Note 1 – Organization and Nature of Business Effective January 21, 2021, we changed our name from Black Ridge Oil & Gas, Inc. to Sow Good Inc. (“SOWG,” “Sow Good,” or the “Company”). Our common stock is traded on the OTCQB under the trading symbol “SOWG”. At that time, o On September 26, 2017, the Company finalized an equity raise utilizing a rights offering and backstop agreement, raising net proceeds of $5,051,675 and issuing 1,439,400 shares. The proceeds were used to sponsor a special purpose acquisition company, discussed below, with the remainder for general corporate purposes. On October 10, 2017, the Company’s sponsored special purpose acquisition company, Black Ridge Acquisition Corp. (“BRAC”), completed an IPO raising $138,000,000 of gross proceeds (including proceeds from the exercise of an over-allotment option by the underwriters on October 18, 2017). In addition, the Company purchased 445,000 BRAC units at $10.00 per unit in a private placement transaction for a total contribution of $4,450,000 in order to fulfill its obligations in sponsoring BRAC, On October 1, 2020, the Company completed its acquisition of S-FDF, LLC pursuant to an Asset Purchase Agreement. In connection with the closing of the Asset Purchase Agreement, the Company acquired approximately $2.2 million in cash and certain assets and agreements related to the Seller’s freeze-dried fruits and vegetables business for human consumption and entered into certain employment and registration rights agreements. As of May 6, 2021, the Company still owned 177,479 shares of Allied Esports Entertainment, Inc. (NASDAQ: AESE), the surviving entity after BRAC’s business combination (“Sponsor Shares”), with a fair market value of $425,950. On May 5, 2021, we announced the launch of our direct-to-consumer freeze-dried consumer packaged good (CPG) food brand, Sow Good. Sow Good launches with its first line of non-GMO products including 6 ready-to-make smoothies and 9 snacks. The smoothie lineup offers a mix of both new and familiar flavors: Açaí of Relief (açaí, blueberry); Mint to Be (banana, coconut, mint); and Berry Apeeling (banana, strawberry). Sow Good packaged snack lineup includes single-ingredient fruits and vegetables such as Mon Cherry (cherries); Cool Beans (edamame); and What’s Apple’n (apples). Smoothies are $7.50 each and packaged snacks are $5.25 per bag. In addition, we completed the build-out of our production facility in March, and have finalized products and packaging, while delivering samples to potential B2B customers. Our first freeze drier successfully completed its production testing in March 2021. The company is now producing its own freeze-dried fruits and vegetables from individual quick freeze (IQF) raw materials. Freeze dried food production also continues to be supplemented by our relationships with co-manufacturing partners. |
2. Basis of Presentation and Si
2. Basis of Presentation and Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Significant Accounting Policies | Note 2 – Basis of Presentation and Significant Accounting Policies The interim condensed financial statements included herein, presented in accordance with United States generally accepted accounting principles and stated in US dollars, have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to not make the information presented misleading. These statements reflect all adjustments, which in the opinion of management, are necessary for fair presentation of the information contained therein. Except as otherwise disclosed, all such adjustments are of a normal recurring nature. It is suggested that these interim condensed financial statements be read in conjunction with the audited financial statements for the year ended December 31, 2020, which were included in our Annual Report on Form 10-K. The Company follows the same accounting policies in the preparation of interim reports. Fair Value of Financial Instruments The Company discloses the fair value of certain assets and liabilities in accordance with ASC 820 – Fair Value Measurement Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles 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 amount of revenues and expenses during the reporting period. Actual results could differ from those estimates. Cash in Excess of FDIC Limits The Company maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits. Accounts are guaranteed by the Federal Deposit Insurance Corporation (FDIC) and the Securities Investor Protection Corporation (SIPC) up to $250,000 and $500,000, respectively, under current regulations. The Company had $1,647,593 of cash in excess of FIDC and SIPC insured limits at March 31, 2021, and has not experienced any losses in such accounts. Property and Equipment Property and equipment are stated at the lower of cost or estimated net recoverable amount. The cost of property, plant and equipment is depreciated using the straight-line method based on the lesser of the estimated useful lives of the assets or the lease term based on the following life expectancy: Software 3 years, or over the life of the agreement Office equipment 5 years Furniture and fixtures 5 years Machinery and equipment 7-10 years Intangible assets 10 years Leasehold improvements Fully extended lease-term Repairs and maintenance expenditures are charged to operations as incurred. Major improvements and replacements, which extend the useful life of an asset, are capitalized and depreciated over the remaining estimated useful life of the asset. When assets are retired or sold, the cost and related accumulated depreciation and amortization are eliminated and any resulting gain or loss is reflected in operations. Depreciation expense was $4,996 and $271 for the three months ended March 31, 2021 and 2020, respectively. Impairment of Long-Lived Assets Long-lived assets held and used by the Company are reviewed for possible impairment whenever events or circumstances indicate the carrying amount of an asset may not be recoverable or is impaired. Recoverability is assessed using undiscounted cash flows based upon historical results and current projections of earnings before interest and taxes. Impairment is measured using discounted cash flows of future operating results based upon a rate that corresponds to the cost of capital. Impairments are recognized in operating results to the extent that carrying value exceeds discounted cash flows of future operations. Our intellectual property is comprised of indefinite-lived brand names acquired and have been assigned an indefinite life as we currently anticipate that these brand names will contribute cash flows to the Company perpetually. We evaluate the recoverability of intangible assets periodically by taking into account events or circumstances that may warrant revised estimates of useful lives or that indicate the asset may be impaired. Inventory Inventory, consisting of raw materials, material overhead, labor, and manufacturing overhead, are stated at the lower of cost (first-in, first-out) or net realizable value and consists of the following: March 31, December 31, 2021 2020 Raw materials $ 116,228 $ 141,371 Work in progress 314,018 – Packaging materials 26,618 – $ 456,864 $ 141,371 No reserve for obsolete inventories has been recognized, and we have not yet commenced production. Goodwill The Company evaluates goodwill on an annual basis in the fourth quarter or more frequently if management believes indicators of impairment exist. Such indicators could include, but are not limited to (1) a significant adverse change in legal factors or in business climate, (2) unanticipated competition, or (3) an adverse action or assessment by a regulator. The Company first assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, management conducts a quantitative goodwill impairment test. The impairment test involves comparing the fair value of the applicable reporting unit with its carrying value. The Company estimates the fair values of its reporting units using a combination of the income, or discounted cash flows, approach and the market approach, which utilizes comparable companies’ data. If the carrying amount of a reporting unit exceeds the reporting unit’s fair value, an impairment loss is recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. The Company’s evaluation of goodwill completed during the year resulted in no impairment losses. Revenue Recognition The Company will recognize revenue in accordance with ASC 606 — Revenue from Contracts with Customers in accordance with a five-step model in which the Company will evaluate the transfer of promised goods or services and recognize revenue when customers obtain control of promised goods or services in an amount that reflects the consideration which the Company expects to be entitled to receive in exchange for those goods or services. To determine revenue recognition for the arrangements that the Company determines are within the scope of ASC 606, the Company will perform the following five steps: (1) identify the contract(s) with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract and (5) recognize revenue when (or as) the entity satisfies a performance obligation. The Company has elected, as a practical expedient, to account for the shipping and handling as fulfillment costs, rather than as a separate performance obligation. Revenue will be reported net of applicable provisions for discounts, returns and allowances. Methodologies for determining these provisions will be dependent on customer pricing and promotional practices. The Company will record reductions to revenue for estimated product returns and pricing adjustments in the same period that the related revenue is recorded. These estimates will be based on industry-based historical data, historical sales returns, if any, analysis of credit memo data, and other factors known at the time. Basic and Diluted Earnings (Loss) Per Share Basic earnings (loss) per share (“EPS”) are computed by dividing net income (the numerator) by the weighted average number of common shares outstanding for the period (the denominator). Diluted EPS is computed by dividing net income by the weighted average number of common shares and potential common shares outstanding (if dilutive) during each period. Potential common shares include stock options, warrants and restricted stock. The number of potential common shares outstanding relating to stock options, warrants and restricted stock is computed using the treasury stock method. For the three months ended March 31, 2021 and 2020, potential dilutive securities had an anti-dilutive effect and were excluded from the calculation of diluted net loss per common share. Stock-Based Compensation The Company accounts for equity instruments issued to employees in accordance with the provisions of ASC 718 Stock Compensation (ASC 718) and Equity-Based Payments to Non-employees pursuant to ASC 2018-07 (ASC 2018-07). All transactions in which the consideration provided in exchange for the purchase of goods or services consists of the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. The measurement date of the fair value of the equity instrument issued is the earlier of the date on which the counterparty’s performance is complete or the date at which a commitment for performance by the counterparty to earn the equity instruments is reached because of sufficiently large disincentives for nonperformance. Stock-based compensation was $375,891 and $35,284, consisting entirely of expenses related to common stock and options issued for services for the three months ended March 31, 2021 and 2020, respectively, using the Black-Scholes options pricing model and an effective term of 6 to 6.5 years based on the weighted average of the vesting periods and the stated term of the option grants and the discount rate on 5 to 7 year U.S. Treasury securities at the grant date. In addition, $13,795 of expenses related to the amortization of warrants issued in consideration of personal guarantees provided for debt financing for the three months ended March 31, 2020. Income Taxes The Company recognizes deferred tax assets and liabilities based on differences between the financial reporting and tax basis of assets and liabilities using the enacted tax rates and laws that are expected to be in effect when the differences are expected to be recovered. The Company provides a valuation allowance for deferred tax assets for which it does not consider realization of such assets to be more likely than not. On December 22, 2017 the U.S. Tax Cuts and Jobs Act of 2017 (“Tax Reform”) was signed into law. As a result of Tax Reform, the U.S. statutory rate was lowered from 35% to 21% effective January 1, 2018, among other changes. ASC Topic 740 requires companies to recognize the effect of tax law changes in the period of enactment; therefore, the Company was required to value its deferred tax assets and liabilities at the new rate. The SEC issued Staff Accounting Bulletin No. 118 (“SAB 118”) to address the application of GAAP in situations when a registrant does not have the necessary information available, prepared or analyzed (including computations) in reasonable detail to complete the accounting for certain effects of Tax Reform. The ultimate impact may differ from the provisional amount, possibly materially, as a result of additional analysis, changes in interpretations and assumptions the Company has made, additional regulatory guidance that may be issued and actions the Company may take as a result of Tax Reform. Uncertain Tax Positions In accordance with ASC 740, “Income Taxes” (“ASC 740”), the Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be capable of withstanding examination by the taxing authorities based on the technical merits of the position. These standards prescribe a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. These standards also provide guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. Various taxing authorities can periodically audit the Company’s income tax returns. These audits include questions regarding the Company’s tax filing positions, including the timing and amount of deductions and the allocation of income to various tax jurisdictions. In evaluating the exposures connected with these various tax filing positions, including state and local taxes, the Company records allowances for probable exposures. A number of years may elapse before a particular matter, for which an allowance has been established, is audited and fully resolved. The Company has not yet undergone an examination by any taxing authorities. The assessment of the Company’s tax position relies on the judgment of management to estimate the exposures associated with the Company’s various filing positions. Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board ("FASB") that are adopted by the Company as of the specified effective date. If not discussed, management believes that the impact of recently issued standards, which are not yet effective, will not have a material impact on the Company's financial statements upon adoption. In August 2020, the FASB issued ASU No. 2020-06, Debt–Debt with Conversion and Other Options and Derivatives and Hedging–Contracts in Entity’s Own Equity : Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity ASU 2020-06 In May 2020, In November 2019, the FASB issued ASU 2019-12 – Income Taxes 740” Simplifying the Accounting for Income Taxes . No other new accounting pronouncements, issued or effective during the period ended March 31, 2021, have had or are expected to have a significant impact on the Company’s financial statements. |
3. Going Concern
3. Going Concern | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern | Note 3 – Going Concern As shown in the accompanying financial statements, as of March 31, 2021, the Company has incurred recurring losses from operations resulting in an accumulated deficit of $37,486,215, and had cash and liquid securities on hand of $3,057,253. As of March 31, 2021, the Company’s cash on hand may not be sufficient to sustain operations. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The Company is currently seeking additional sources of capital to fund short term operations. The Company intends to sell its AESE shares to continue as a going concern, however, there can be no assurance the share price will be sufficient to sustain operations, therefore the Company may be dependent upon its ability to secure equity and/or debt financing and there are also no assurances that the Company will be successful; therefore, without sufficient financing it would be unlikely for the Company to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of any uncertainty as to the Company’s ability to continue as a going concern. The financial statements also do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern. Our ability to scale production and distribution capabilities and further increase the value of our brands, is largely dependent on our success in raising additional capital. As of May 6th 2021, the Company had $1,862,434 of cash on hand and shares in AESE stock with a fair market value of $425,950. |
4. Business Combination, S-FDF
4. Business Combination, S-FDF | 3 Months Ended |
Mar. 31, 2021 | |
Business Combinations [Abstract] | |
Business Combination, S-FDF | Note 4 – Business Combination, S-FDF On October 1, 2020, the Company completed its acquisition of S-FDF, LLC (the "Seller"), a Texas limited liability company, pursuant to an Asset Purchase Agreement, between the Company and the Seller, dated June 9, 2020, as subsequently amended effective October 1, 2020. In connection with the closing of the Asset Purchase Agreement, the Company acquired approximately $2.2 million in cash and certain assets and agreements related to the Seller’s freeze-dried fruits and vegetables business for human consumption and entered into certain employment and registration rights agreements. The Company did not assume any liabilities of Seller or any liabilities, liens, or encumbrances pertaining to or encumbering the Purchased Assets, except for those related to agreements or arrangements specified in the Asset Purchase Agreement. The Seller transferred the Purchased Assets to the Company in exchange for the issuance of 1,120,000 shares of the Company’s common stock to the Seller. The number of Seller Shares to be issued was subject to adjustment, as specified in the Asset Purchase Agreement, as amended, based on the extent to which the amount of cash proceeds held by the Company, as derived from the sale of the Company’s holdings of Allied Esports Entertainment Inc. ("AESE") Shares, were less than $5 million or greater than $6 million on the date specified in the Asset Purchase Agreement, which resulted in the issuance of an additional 500,973 Seller Shares that were issued on January 4, 2021. The combined issuances represented approximately 46% of the Company’s issued and outstanding common stock, on a fully diluted basis. Black Ridge Oil & Gas, Inc. was determined to be the acquiror of the business combination. Pursuant to its obligations under the Asset Purchase Agreement, on the Closing Date the Company, (a) created three new seats on the Company’s Board of Directors and appointed the Seller’s principals, Ira Goldfarb and Claudia Goldfarb, and a third person designated by the Goldfarbs, Greg Creed, as directors, (b) entered into employment agreements with Ira Goldfarb and Claudia Goldfarb, (c) delivered a registration rights agreement with respect to the Seller Shares and any shares of common stock delivered as part of the employment compensation for Ira Goldfarb or Claudia Goldfarb, and (d) amended the Company’s 2020 Stock Incentive Plan to increase the number of shares of common stock reserved thereunder. At closing, the Company also assumed the Seller’s obligations under a real property lease for its facility in Irving, Texas under which an entity owned entirely by Ira Goldfarb is the landlord. This acquisition was accounted for as a business combination under the purchase method of accounting. The purchase resulted in the recognition of $6,411,327 of goodwill, which is evaluated annually for impairment, unless circumstances change that require an earlier determination. According to the purchase method of accounting, the Company recognized the identifiable assets acquired and liabilities assumed as follows: October 1, 2020 Consideration: Fair value of 1,620,973 shares of common stock $ 8,573,600 Liabilities assumed: Accounts payable 137,113 Accrued expenses 79,467 Lease liabilities 1,449,061 Total consideration $ 10,239,241 Fair value of identifiable assets acquired: Cash $ 1,154,459 Other receivables 17,348 Prepaid expenses 150,524 Property and equipment 239,868 Construction in progress 845,579 Security deposit 10,000 Right-of-use asset 1,410,136 Total fair value of assets acquired 3,827,914 Consideration paid in excess of fair value (Goodwill) (1) $ 6,411,327 (1) The consideration paid in excess of the net fair value of assets acquired and liabilities assumed was recognized as goodwill. The book value of the net assets acquired was determined to represent the fair market value, and no additional intangible assets were evidenced. Pro Forma Results The following table sets forth the unaudited pro forma results of the Company as if the acquisition of S-FDF, LLC was effective on the first day of each of the periods presented. These combined results are not necessarily indicative of the results that may have been achieved had the companies always been combined. For the Three Months Ended March 31, 2021 2020 (2) (Unaudited) (Unaudited) Revenues $ – $ – Net operating loss $ (1,150,860 ) $ (417,618 ) Net loss $ (807,877 ) $ (2,645,579 ) Weighted average common shares outstanding – basic and fully diluted 3,678,459 3,220,528 Net loss per common share – basic and fully diluted $ (0.22 ) $ (0.82 ) (2) |
5. Related Party
5. Related Party | 3 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions [Abstract] | |
Related Party | Note 5 – Related Party Issuance of Shares in Completion of Acquisition In connection with the closing of the Amended Asset Purchase Agreement between the Company and S-FDF, LLC, the Company was obligated to make certain adjustments to the common stock issued to Seller. The adjustment was based primarily on the fair value of AESE shares sold subsequent to the Asset Purchase Agreement. On December 31, 2020, the final number of shares to be issued to S-FDF, LLC was determined to be 500,973 shares and a common stock payable was recognized in the amount of $1,853,600, the fair value of the common stock based on the closing price of the Company’s common stock on the date of grant. On January 4, 2021, the 500,973 shares were issued in settlement of the common stock payable. Common Stock Payable Awarded to Officers On March 31, 2021, the Company awarded 5,541 and 6,044 shares of common stock to Claudia and Ira Goldfarb The aggregate fair value of the shares was $34,853 and $38,016 for Claudia and Ira, respectively, based on the closing price of the Company’s common stock on the date of grant common stock payable. Issuance of Shares for Services On February 28, 2021, the Company issued to Claudia and Ira Goldfarb , for their services for February 2021. The aggregate fair value of the shares was $38,787 and $42,308 for Claudia and Ira, respectively, based on the closing price of the Company’s common stock on the date of grant. On January 31, 2021, the Company issued to Claudia and Ira Goldfarb , for their services for January 2021. The aggregate fair value of the shares was $29,035 and $31,671 for Claudia and Ira, respectively, based on the closing price of the Company’s common stock on the date of grant. On January 27, 2021, upon Benjamin Oehler’s resignation, the Company a issued 6,400 shares of common stock for his services to be rendered. The aggregate fair value of the common stock was $40,000, based on the closing price of the Company’s common stock on the date of grant. On January 7, 2021, the Company issued an aggregate 16,623 and 18,133 shares of common stock to Claudia and Ira Goldfarb common stock payable. Common Stock Sold for Cash On February 5, 2021, the Company entered into a Stock Purchase Agreement with multiple accredited investors to sell and issue to the Purchasers an aggregate 631,250 shares of the Company’s common stock at a price of $4.00 per share for total proceeds of $2,525,000. A total of 225,000 of these shares, or proceeds of $900,000 were purchased by officers and directors. Options Granted On January 27, 2021, Chris Ludeman was granted options to purchase 24,151 shares of the Company’s common stock, having an exercise price of $6.25 per share, exercisable over a ten-year term. The options will vest in three equal annual installments beginning of January 27, 2022 and continuing on each of the two anniversaries thereafter until fully vested. The estimated value using the Black-Scholes Pricing Model, based on a volatility rate of 198% and a call option value of $6.1794, was $149,239. The options were expensed over the vesting period, resulting in $327 of stock-based compensation expense during the three months ended March 31, 2021. On January 4, 2021, Claudia and Ira Goldfarb were each granted options to purchase 75,000 shares of the Company’s common stock, having an exercise price of $3.70 per share, exercisable over a ten-year term. The options will vest in three equal installments beginning of January 4, 2022 and continuing on each of the two anniversaries thereafter until fully vested. The aggregate estimated value using the Black-Scholes Pricing Model, based on a volatility rate of 198% and a call option value of $3.9412, was $591,178. The options were expensed over the vesting period, resulting in $46,430 of stock-based compensation expense during the three months ended March 31, 2021. Lease Agreement Upon closing of the Asset Purchase Agreement, the Company assumed the Seller’s obligations under a real property lease for its 20,945 square foot facility in Irving, Texas, under which an entity owned entirely by Ira Goldfarb is the landlord. The lease term is through September 15, 2025, with two five-year options to extend, at a monthly lease term of $10,036, with approximately a 3% annual escalation of lease payments commencing September 15, 2021. |
6. Fair Value of Financial Inst
6. Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Note 6 – Fair Value of Financial Instruments Under FASB ASC 820-10-5, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). The standard outlines a valuation framework and creates a fair value hierarchy in order to increase the consistency and comparability of fair value measurements and the related disclosures. Under GAAP, certain assets and liabilities must be measured at fair value, and FASB ASC 820-10-50 details the disclosures that are required for items measured at fair value. The Company has cash and cash equivalents and a revolving credit facility that must be measured under the fair value standard. The Company’s financial assets and liabilities are measured using inputs from the three levels of the fair value hierarchy. The three levels are as follows: Level 1 - Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. Level 2 - Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs). Level 3 - Unobservable inputs that reflect our assumptions about the assumptions that market participants would use in pricing the asset or liability. The following schedule summarizes the valuation of financial instruments at fair value on a recurring basis in the balance sheets as of March 31, 2021 and December 31, 2020: Fair Value Measurements at March 31, 2021 Level 1 Level 2 Level 3 Assets Cash and cash equivalents $ 2,546,113 $ – $ – Investment in Allied Esports Entertainment, Inc. 511,140 – – Goodwill 6,411,327 – – Total assets 9,468,580 – – Liabilities Notes payable – 150,000 – Total liabilities – 150,000 – $ 9,468,580 $ (150,000 ) $ – Fair Value Measurements at December 31, 2020 Level 1 Level 2 Level 3 Assets Cash and cash equivalents $ 1,912,729 $ – $ – Investment in Allied Esports Entertainment, Inc. 280,417 – – Goodwill 6,411,327 – – Total assets 8,604,473 – – Liabilities Notes payable – 262,925 – Total liabilities – 262,925 – $ 8,604,473 $ (262,925 ) $ – There were no transfers of financial assets or liabilities between Level 1 and Level 2 inputs for the three months ended March 31, 2021. |
7. Prepaid Expenses
7. Prepaid Expenses | 3 Months Ended |
Mar. 31, 2021 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Prepaid Expenses | Note 7 – Prepaid Expenses Prepaid expenses consists of the following: March 31, December 31, 2021 2020 Prepaid software licenses $ 15,282 $ 26,853 Prepaid insurance costs 8,421 11,325 Prepaid employee benefits 500 8,082 Prepaid office and other costs 28,972 10,167 Total prepaid expenses $ 53,175 $ 56,427 |
8. Property and Equipment
8. Property and Equipment | 3 Months Ended |
Mar. 31, 2021 | |
Property and equipment: | |
Property and Equipment | Note 8 – Property and Equipment Property and equipment at March 31, 2021 and December 31, 2020, consists of the following: March 31, December 31, 2021 2020 Office equipment $ 13,873 $ 5,042 Machinery 131,031 183,680 Software 70,000 49,000 Website 320,798 259,772 Construction in progress 2,298,227 1,639,690 2,833,929 2,137,184 Less: Accumulated depreciation and amortization (7,608 ) (2,612 ) Total property and equipment, net $ 2,826,321 $ 2,134,572 Construction in progress consists of costs incurred to build out our manufacturing facility in Irving Texas, along with the construction of our freeze driers. These costs will be capitalized as Leasehold Improvements and Machinery, respectively, upon completion. On September 30, 2020, the Company disposed of computer equipment no longer in service. No proceeds were received on the disposal of the equipment, resulting in a loss on disposal of fixed assets of $5,369, which represented the net book value at the time of disposal. The Company recognized depreciation expense of $4,996 and $271 for the three-month periods ended March 31, 2021 and 2020, respectively. |
9. Investments in Allied Esport
9. Investments in Allied Esports Entertainment, Inc. | 3 Months Ended |
Mar. 31, 2021 | |
Investments, All Other Investments [Abstract] | |
Investments in Allied Esports Entertainment, Inc. | Note 9 – Investment in Allied Esports Entertainment, Inc. Following the close of BRAC’s merger, the Company retained 2,685,500 shares of AESE common stock with a value, based on the closing stock of $4.45 on the merger, of $11,950,475, and tradeable warrants to purchase 505,000 shares of AESE (NASDAQ: AESEW) (“Sponsor Warrants”), of which the Company still owned 177,479 shares as of March 31, 2021, after selling 1,970,920 shares for total net proceeds of $3,108,067, selling warrants to purchase 505,000 Sponsor Warrants for total proceeds of $73,668, and distributing 537,101 Sponsor Shares to employees and directors under the 2018 Management Incentive Plan during 2020. As of March 31, 2021, the market value of the Company’s investment in AESE’s common stock was $511,140, based on the closing stock price of $2.88 per share, resulting in losses on our investment in securities, as follows: March 31, March 31, 2021 2020 Net gain (loss) on investment in Allied Esports Entertainment, Inc. securities $ 230,723 $ (2,212,852 ) Less: Net gains and losses recognized on equity securities sold during the period – – Unrealized gains (losses) recognized on equity securities still held at the end of the period $ 230,723 $ (2,212,852 |
10. Leases
10. Leases | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Leases | Note 10 – Leases The Company leases its 20,945 square foot operating and office facility under a non-cancelable real property lease agreement that expires on August 31, 2025, with two five-year options to extend, at a monthly lease term of $10,036, with approximately a 3% annual escalation of lease payments commencing September 15, 2021, subject to the ASU 2016-02. In the locations in which it is economically feasible to continue to operate, management expects to enter into a new lease upon expiration. The operating and office facility lease contains provisions requiring payment of property taxes, utilities, insurance, maintenance and other occupancy costs applicable to the leased premise. As the Company’s leases do not provide implicit discount rates, the Company uses an incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The components of lease expense were as follows: For the Three Months Ended March 31, 2021 Operating lease cost: Fixed rent expense $ 36,720 Supplemental balance sheet information related to leases was as follows: March 31, 2021 Operating leases: Operating lease assets $ 1,378,133 Current portion of operating lease liabilities $ 41,353 Noncurrent operating lease liabilities 1,388,927 Total operating lease liabilities $ 1,430,280 Weighted average remaining lease term: Operating leases 14.75 years Weighted average discount rate: Operating leases 5.75% Supplemental cash flow and other information related to leases was as follows: For the Three Months Ended 2021 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows used for operating leases $ 9,458 Leased assets obtained in exchange for lease liabilities: Total operating lease liabilities $ 1,430,280 The future minimum lease payments due under operating leases as of March 31, 2021 was as follows: Fiscal Year Ending Minimum Lease December 31, Commitments 2021 (for the nine months remaining) $ 91,530 2022 125,287 2023 129,046 2024 132,917 2025 1,690,905 2,169,685 Less effects of discounting 739,405 Lease liability recognized $ 1,430,280 |
11. Notes Payable
11. Notes Payable | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Notes Payable | Note 11 – Notes Payable Notes payable consists of the following at March 31, 2021 and December 31, 2020, respectively: March 31, December 31, 2021 2020 On June 16, 2020, the Company entered into a loan authorization and loan agreement with the United States Small Business Administration (the “SBA”), as lender, pursuant to the SBA’s Economic Injury Disaster Loan (“EIDL”) assistance program in light of the impact of the COVID-19 pandemic on the Company’s business (the “EIDL Loan Agreement”) encompassing a $150,000 Promissory Note issued to the SBA (the “EIDL Note”)(together with the EIDL Loan Agreement, the “EIDL Loan”), bearing interest at 3.75% per annum. In connection with entering into the EIDL Loan, the Company also executed a security agreement, dated June 16, 2020, between the SBA and the Company (the “EIDL Security Agreement”) pursuant to which the EIDL Loan is secured by a security interest on all of the Company’s assets. Under the EIDL Note, the Company is required to pay principal and interest payments of $731 every month beginning June 16, 2021. All remaining principal and accrued interest is due and payable on June 16, 2050. The EIDL Note may be repaid at any time without penalty. $ 150,000 $ 150,000 On April 24, 2020, the Company entered into a loan agreement with Kensington Bank (“Kensington”), as lender (the “Loan Agreement”) encompassing a $112,925 Promissory Note issued to Kensington (the “PPP Note”) pursuant to Payroll Protection Program established as part of the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), which provides loans to qualifying businesses and is administered by the U.S. Small Business Administration (the “SBA”). The PPP Note bears interest at 1.00% per annum, with interest payable monthly beginning November 24, 2020, and principal due in full on April 24, 2022. The PPP Note could have been repaid at any time without penalty. Under the Payroll Protection Program, the Company received loan forgiveness of $113,772, consisting of $112,925 of principal and $847 of accrued interest, on January 19, 2021. The forgiveness amount was equal to the amount that the Company spends during the 24-week period beginning April 24, 2020 on payroll costs, payment of rent on any leases in force prior to February 15, 2020 and payment on any utility for which service began before February 15, 2020. The maximum amount of loan forgiveness for non-payroll expenses was 40% of the amount of the PPP Note. – 112,925 Total notes payable 150,000 262,925 Less unamortized derivative discounts: – – Notes payable 150,000 262,925 Less: current maturities – – Notes payable, less current maturities $ 150,000 $ 262,925 The Company recognized $1,512 and $15,109 of interest expense, consisting of $1,314 of interest and $13,795 of stock-based warrant expense pursuant to the amortization of the debt discounts, during the three months ended March 31, 2021 and 2020, respectively. |
12. Changes in Stockholders' Eq
12. Changes in Stockholders' Equity | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Changes in Stockholders' Equity | Note 12 – Changes in Stockholders’ Equity Reverse Stock Split On February 21, 2020, the Company effected a 1-for-300 reverse stock split (the “Reverse Stock Split”). No fractional shares were issued. Instead, the Company issued the following to any stockholder who otherwise would have received a fractional share as a result of the Reverse Stock Split: · Stockholders owning 300 or more shares of Common Stock received (1) one share of Common Stock for every 300 shares owned and (2) cash in lieu of fractional shares upon the surrender of such stockholder’s shares; · Stockholders owning between 25 and 300 shares of Common Stock had their ownership of shares of Common Stock rounded up to one share; and · Stockholders owning fewer than 25 shares of Common Stock received cash in lieu of fractional shares upon the surrender of such stockholders’ shares and no longer own shares of Common Stock. Any cash payment in lieu of fractional shares were based on the volume weighted average of the closing sales prices of the Company’s Common Stock on the OTCQB operated by OTC Markets Group Inc. (the “OTCQB”) during regular trading hours for the five consecutive trading days immediately preceding the Effective Date, which was $0.018 per share prior to the effects of the reverse stock split. The Company was authorized to issue 500,000,000 shares of common stock prior to the Reverse Stock Split, which remains unaffected. The Reverse Stock Split did not have any effect on the stated par value of the common stock, or the Company’s authorized preferred stock. Unless otherwise stated, all share and per share information in this Interim Report has been retroactively adjusted to reflect the Reverse Stock Split. Preferred Stock The Company has 20,000,000 authorized shares of $0.001 par value preferred stock. No shares have been issued to date. Common Stock The Company has 500,000,000 authorized shares of $0.001 par value common stock. As of March 31, 2021, a total of 3,939,439 shares of common stock have been issued. Issuance of Shares in Completion of Acquisition In connection with the closing of the Amended Asset Purchase Agreement between the Company and S-FDF, LLC, the Company was obligated to make certain adjustments to the common stock issued to Seller. The adjustment was based primarily on the fair value of AESE shares sold subsequent to the Asset Purchase Agreement. On December 31, 2020, the final number of shares to be issued to S-FDF, LLC was determined to be 500,973 shares and a common stock payable was recognized in the amount of $1,853,600, the fair value of the common stock based on the closing price of the Company’s common stock on the date of grant. On January 4, 2021, the 500,973 shares were issued in settlement of the common stock payable. Common Stock Payable Awarded to Officers On March 31, 2021, the Company awarded 5,541 and 6,044 shares of common stock to Claudia and Ira Goldfarb The aggregate fair value of the shares was $34,853 and $38,016 for Claudia and Ira, respectively, based on the closing price of the Company’s common stock on the date of grant common stock payable. Issuance of Shares for Services On February 28, 2021, the Company issued to Claudia and Ira Goldfarb , for their services for February 2021. The aggregate fair value of the shares was $38,787 and $42,308 for Claudia and Ira, respectively, based on the closing price of the Company’s common stock on the date of grant. On January 31, 2021, the Company issued to Claudia and Ira Goldfarb , for their services for January 2021. The aggregate fair value of the shares was $29,035 and $31,671 for Claudia and Ira, respectively, based on the closing price of the Company’s common stock on the date of grant. On January 27, 2021, upon Benjamin Oehler’s resignation, the Company a issued 6,400 shares of common stock for his services to be rendered. The aggregate fair value of the common stock was $40,000, based on the closing price of the Company’s common stock on the date of grant. On January 7, 2021, the Company issued an aggregate 16,623 and 18,133 shares of common stock to Claudia and Ira Goldfarb common stock payable. Common Stock Sold for Cash On February 5, 2021, the Company entered into a Stock Purchase Agreement with multiple accredited investors to sell and issue to the Purchasers an aggregate 631,250 shares of the Company’s common stock at a price of $4.00 per share for total proceeds of $2,525,000. A total of 225,000 of these shares, or proceeds of $900,000 were purchased by officers and directors. |
13. Options
13. Options | 3 Months Ended |
Mar. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Options | Note 13 – Options The 2020 Equity Plan was approved by written consent of a majority of shareholders of record as of November 12, 2019 and adopted by the Board on December 5, 2019, as provided in the definitive information statement filed with Securities and Exchange Commission on January 10, 2020 (the “DEF 14C”). The description of the 2020 Equity Plan is qualified in its entirety by the text of the 2020 Equity Plan, a copy of which was attached as Annex C to the DEF 14C. Outstanding Options Options to purchase an aggregate total of 621,635 shares of common stock at a weighted average strike price of $5.83, exercisable over a weighted average life of 9.31 years were outstanding as of March 31, 2021. Options Granted On January 27, 2021, Chris Ludeman was granted options to purchase 24,151 shares of the Company’s common stock, having an exercise price of $6.25 per share, exercisable over a ten-year term. The options will vest in three equal annual installments beginning of January 27, 2022 and continuing on each of the two anniversaries thereafter until fully vested. The estimated value using the Black-Scholes Pricing Model, based on a volatility rate of 198% and a call option value of $6.1794, was $149,239. The options were expensed over the vesting period, resulting in $327 of stock-based compensation expense during the three months ended March 31, 2021. On January 4, 2021, Claudia and Ira Goldfarb were each granted options to purchase 75,000 shares of the Company’s common stock, having an exercise price of $3.70 per share, exercisable over a ten-year term. The options will vest in three equal installments beginning of January 4, 2022 and continuing on each of the two anniversaries thereafter until fully vested. The aggregate estimated value using the Black-Scholes Pricing Model, based on a volatility rate of 198% and a call option value of $3.9412, was $591,178. The options were expensed over the vesting period, resulting in $46,430 of stock-based compensation expense during the three months ended March 31, 2021. The Company recognized a total of $121,221, and $21,489 of compensation expense during the three months ended March 31, 2021 and 2020, respectively, related to common stock options issued to Officers, Directors, and Employees that are being amortized over the implied service term, or vesting period, of the options. The remaining unamortized balance of these options is $2,053,560 as of March 31, 2021. Options Exercised No options were exercised during the three months ended March 31, 2021 and 2020. Options Forfeited A total of 12,039 options with a weighted average exercise price of $90 were forfeited during the three months ended March 31, 2021. |
14. Warrants
14. Warrants | 3 Months Ended |
Mar. 31, 2021 | |
Warrants and Rights Note Disclosure [Abstract] | |
Warrants | Note 14 – Warrants Outstanding Warrants Warrants to purchase an aggregate total of 106,300 shares of common stock at a $3.99 strike price, exercisable over a weighted average life of 8.86 years were outstanding as of March 31, 2021. Warrants Granted No warrants were granted during the three months ended March 31, 2021 and 2020. Warrants Exercised No warrants were exercised during the three months ended March 31, 2021 and 2020. |
15. Income Taxes
15. Income Taxes | 3 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 15 – Income Taxes The Company accounts for income taxes under ASC Topic 740, Income Taxes, Losses incurred during the period from April 9, 2011 (inception) to March 31, 2021 could be used to offset future tax liabilities. Accounting standards require the consideration of a valuation allowance for deferred tax assets if it is “more likely than not” that some component or all of the benefits of deferred tax assets will not be realized. As of March 31, 2021, net deferred tax assets were $5,658,442, with no deferred tax liability, primarily related to net operating loss carryforwards. A valuation allowance of approximately $5,658,442 was applied to the net deferred tax assets. Therefore, the Company has no tax expense for 2021 to date. In accordance with FASB ASC 740, the Company has evaluated its tax positions and determined there are no significant uncertain tax positions as of any date on, or before March 31, 2021. |
16. Commitments
16. Commitments | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments | Note 16 – Commitments The Company is involved in various inquiries, administrative proceedings and litigation relating to matters arising in the normal course of business. The Company is not currently a defendant in any material litigation and is not aware of any threatened litigation that could have a material effect on the Company. Management is not able to estimate the minimum loss to be incurred, if any, as a result of the final outcome of the matters arising in the normal course of business but believes they are not likely to have a material adverse effect upon the Company’s financial position or results of operations and, accordingly, no provision for loss has been recorded. The Company periodically maintains cash balances at banks in excess of federally insured amounts. The extent of loss, if any, to be sustained as a result of any future failure of a bank or other financial institution is not subject to estimation at this time. Upon closing of the Asset Purchase Agreement, the Company assumed the Seller’s obligations under a real property lease for its 20,945 square foot facility in Irving, Texas, under which an entity owned entirely by Ira Goldfarb is the landlord. The lease term is through September 15, 2025, with two five-year options to extend, at a monthly lease term of $10,036, with approximately a 3% annual escalation of lease payments commencing September 15, 2021. The future minimum lease payments due under operating leases as of March 31, 2021 is as follows: Fiscal Year Ending Minimum Lease December 31, Commitments 2021 (for the nine months remaining) $ 91,530 2022 125,287 2023 129,046 2024 132,917 2025 1,690,905 $ 2,169,685 Less effects of discounting 739,405 Lease liability recognized $ 1,430,280 |
17. Subsequent Events
17. Subsequent Events | 3 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 17 – Subsequent Events The Company evaluates events that have occurred after the balance sheet date through the date these financial statements were issued. Common Stock Issued to Officers on Common Stock Payable On April 6, 2021, the Company issued 5,541 and 6,044 shares of common stock to Claudia and Ira Goldfarb common stock payable. Common Stock Awarded to Officers On approximately May 6, 2021, the Company issued 5,541 and 6,044 shares of common stock to Claudia and Ira Goldfarb . |
2. Basis of Presentation and _2
2. Basis of Presentation and Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company discloses the fair value of certain assets and liabilities in accordance with ASC 820 – Fair Value Measurement |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles 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 amount of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Cash in Excess of FDIC Insured Limits | Cash in Excess of FDIC Limits The Company maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits. Accounts are guaranteed by the Federal Deposit Insurance Corporation (FDIC) and the Securities Investor Protection Corporation (SIPC) up to $250,000 and $500,000, respectively, under current regulations. The Company had $1,647,593 of cash in excess of FIDC and SIPC insured limits at March 31, 2021, and has not experienced any losses in such accounts. |
Property and Equipment | Property and Equipment Property and equipment are stated at the lower of cost or estimated net recoverable amount. The cost of property, plant and equipment is depreciated using the straight-line method based on the lesser of the estimated useful lives of the assets or the lease term based on the following life expectancy: Software 3 years, or over the life of the agreement Office equipment 5 years Furniture and fixtures 5 years Machinery and equipment 7-10 years Intangible assets 10 years Leasehold improvements Fully extended lease-term Repairs and maintenance expenditures are charged to operations as incurred. Major improvements and replacements, which extend the useful life of an asset, are capitalized and depreciated over the remaining estimated useful life of the asset. When assets are retired or sold, the cost and related accumulated depreciation and amortization are eliminated and any resulting gain or loss is reflected in operations. Depreciation expense was $4,996 and $271 for the three months ended March 31, 2021 and 2020, respectively. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets Long-lived assets held and used by the Company are reviewed for possible impairment whenever events or circumstances indicate the carrying amount of an asset may not be recoverable or is impaired. Recoverability is assessed using undiscounted cash flows based upon historical results and current projections of earnings before interest and taxes. Impairment is measured using discounted cash flows of future operating results based upon a rate that corresponds to the cost of capital. Impairments are recognized in operating results to the extent that carrying value exceeds discounted cash flows of future operations. Our intellectual property is comprised of indefinite-lived brand names acquired and have been assigned an indefinite life as we currently anticipate that these brand names will contribute cash flows to the Company perpetually. We evaluate the recoverability of intangible assets periodically by taking into account events or circumstances that may warrant revised estimates of useful lives or that indicate the asset may be impaired. |
Inventory | Inventory Inventory, consisting of raw materials, material overhead, labor, and manufacturing overhead, are stated at the lower of cost (first-in, first-out) or net realizable value and consists of the following: March 31, December 31, 2021 2020 Raw materials $ 116,228 $ 141,371 Work in progress 314,018 – Packaging materials 26,618 – $ 456,864 $ 141,371 No reserve for obsolete inventories has been recognized, and we have not yet commenced production. |
Goodwill | Goodwill The Company evaluates goodwill on an annual basis in the fourth quarter or more frequently if management believes indicators of impairment exist. Such indicators could include, but are not limited to (1) a significant adverse change in legal factors or in business climate, (2) unanticipated competition, or (3) an adverse action or assessment by a regulator. The Company first assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, management conducts a quantitative goodwill impairment test. The impairment test involves comparing the fair value of the applicable reporting unit with its carrying value. The Company estimates the fair values of its reporting units using a combination of the income, or discounted cash flows, approach and the market approach, which utilizes comparable companies’ data. If the carrying amount of a reporting unit exceeds the reporting unit’s fair value, an impairment loss is recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. The Company’s evaluation of goodwill completed during the year resulted in no impairment losses. |
Revenue Recognition | Revenue Recognition The Company will recognize revenue in accordance with ASC 606 — Revenue from Contracts with Customers in accordance with a five-step model in which the Company will evaluate the transfer of promised goods or services and recognize revenue when customers obtain control of promised goods or services in an amount that reflects the consideration which the Company expects to be entitled to receive in exchange for those goods or services. To determine revenue recognition for the arrangements that the Company determines are within the scope of ASC 606, the Company will perform the following five steps: (1) identify the contract(s) with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract and (5) recognize revenue when (or as) the entity satisfies a performance obligation. The Company has elected, as a practical expedient, to account for the shipping and handling as fulfillment costs, rather than as a separate performance obligation. Revenue will be reported net of applicable provisions for discounts, returns and allowances. Methodologies for determining these provisions will be dependent on customer pricing and promotional practices. The Company will record reductions to revenue for estimated product returns and pricing adjustments in the same period that the related revenue is recorded. These estimates will be based on industry-based historical data, historical sales returns, if any, analysis of credit memo data, and other factors known at the time. |
Basic and Diluted Earnings (Loss) Per Share | Basic and Diluted Earnings (Loss) Per Share Basic earnings (loss) per share (“EPS”) are computed by dividing net income (the numerator) by the weighted average number of common shares outstanding for the period (the denominator). Diluted EPS is computed by dividing net income by the weighted average number of common shares and potential common shares outstanding (if dilutive) during each period. Potential common shares include stock options, warrants and restricted stock. The number of potential common shares outstanding relating to stock options, warrants and restricted stock is computed using the treasury stock method. For the three months ended March 31, 2021 and 2020, potential dilutive securities had an anti-dilutive effect and were excluded from the calculation of diluted net loss per common share. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for equity instruments issued to employees in accordance with the provisions of ASC 718 Stock Compensation (ASC 718) and Equity-Based Payments to Non-employees pursuant to ASC 2018-07 (ASC 2018-07). All transactions in which the consideration provided in exchange for the purchase of goods or services consists of the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. The measurement date of the fair value of the equity instrument issued is the earlier of the date on which the counterparty’s performance is complete or the date at which a commitment for performance by the counterparty to earn the equity instruments is reached because of sufficiently large disincentives for nonperformance. Stock-based compensation was $375,891 and $35,284, consisting entirely of expenses related to common stock and options issued for services for the three months ended March 31, 2021 and 2020, respectively, using the Black-Scholes options pricing model and an effective term of 6 to 6.5 years based on the weighted average of the vesting periods and the stated term of the option grants and the discount rate on 5 to 7 year U.S. Treasury securities at the grant date. In addition, $13,795 of expenses related to the amortization of warrants issued in consideration of personal guarantees provided for debt financing for the three months ended March 31, 2020. |
Income Taxes | Income Taxes The Company recognizes deferred tax assets and liabilities based on differences between the financial reporting and tax basis of assets and liabilities using the enacted tax rates and laws that are expected to be in effect when the differences are expected to be recovered. The Company provides a valuation allowance for deferred tax assets for which it does not consider realization of such assets to be more likely than not. On December 22, 2017 the U.S. Tax Cuts and Jobs Act of 2017 (“Tax Reform”) was signed into law. As a result of Tax Reform, the U.S. statutory rate was lowered from 35% to 21% effective January 1, 2018, among other changes. ASC Topic 740 requires companies to recognize the effect of tax law changes in the period of enactment; therefore, the Company was required to value its deferred tax assets and liabilities at the new rate. The SEC issued Staff Accounting Bulletin No. 118 (“SAB 118”) to address the application of GAAP in situations when a registrant does not have the necessary information available, prepared or analyzed (including computations) in reasonable detail to complete the accounting for certain effects of Tax Reform. The ultimate impact may differ from the provisional amount, possibly materially, as a result of additional analysis, changes in interpretations and assumptions the Company has made, additional regulatory guidance that may be issued and actions the Company may take as a result of Tax Reform. |
Uncertain Tax Positions | Uncertain Tax Positions In accordance with ASC 740, “Income Taxes” (“ASC 740”), the Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be capable of withstanding examination by the taxing authorities based on the technical merits of the position. These standards prescribe a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. These standards also provide guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. Various taxing authorities can periodically audit the Company’s income tax returns. These audits include questions regarding the Company’s tax filing positions, including the timing and amount of deductions and the allocation of income to various tax jurisdictions. In evaluating the exposures connected with these various tax filing positions, including state and local taxes, the Company records allowances for probable exposures. A number of years may elapse before a particular matter, for which an allowance has been established, is audited and fully resolved. The Company has not yet undergone an examination by any taxing authorities. The assessment of the Company’s tax position relies on the judgment of management to estimate the exposures associated with the Company’s various filing positions. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board ("FASB") that are adopted by the Company as of the specified effective date. If not discussed, management believes that the impact of recently issued standards, which are not yet effective, will not have a material impact on the Company's financial statements upon adoption. In August 2020, the FASB issued ASU No. 2020-06, Debt–Debt with Conversion and Other Options and Derivatives and Hedging–Contracts in Entity’s Own Equity : Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity ASU 2020-06 In May 2020, In November 2019, the FASB issued ASU 2019-12 – Income Taxes 740” Simplifying the Accounting for Income Taxes . No other new accounting pronouncements, issued or effective during the period ended March 31, 2021, have had or are expected to have a significant impact on the Company’s financial statements. |
2. Basis of Presentation and _3
2. Basis of Presentation and Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Schedule of estimated useful lives of assets | The cost of property, plant and equipment is depreciated using the straight-line method based on the lesser of the estimated useful lives of the assets or the lease term based on the following life expectancy: Software 3 years, or over the life of the agreement Office equipment 5 years Furniture and fixtures 5 years Machinery and equipment 7-10 years Intangible assets 10 years Leasehold improvements Fully extended lease-term |
Schedule of inventory | Inventory, consisting of raw materials, material overhead, labor, and manufacturing overhead, are stated at the lower of cost (first-in, first-out) or net realizable value and consist of the following: March 31, December 31, 2021 2020 Raw materials $ 116,228 $ 141,371 Work in progress 314,018 – Packaging materials 26,618 – $ 456,864 $ 141,371 |
4. Business Combination, S-FDF
4. Business Combination, S-FDF (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Business Combinations [Abstract] | |
Schedule of recognized identified assets and liabilities assumed | The Company recognized the identifiable assets acquired and liabilities assumed as follows: October 1, 2020 Consideration: Fair value of 1,620,973 shares of common stock $ 8,573,600 Liabilities assumed: Accounts payable 137,113 Accrued expenses 79,467 Lease liabilities 1,449,061 Total consideration $ 10,239,241 Fair value of identifiable assets acquired: Cash $ 1,154,459 Other receivables 17,348 Prepaid expenses 150,524 Property and equipment 239,868 Construction in progress 845,579 Security deposit 10,000 Right-of-use asset 1,410,136 Total fair value of assets acquired 3,827,914 Consideration paid in excess of fair value (Goodwill) (1) $ 6,411,327 (1)The consideration paid in excess of the net fair value of assets acquired and liabilities assumed was recognized as goodwill. The book value of the net assets acquired was determined to represent the fair market value, and no additional intangible assets were evidenced. |
Schedule of unaudited pro forma | For the Three Months Ended March 31, 2021 2020 (2) (Unaudited) (Unaudited) Revenues $ – $ – Net operating loss $ (1,150,860 ) $ (417,618 ) Net loss $ (807,877 ) $ (2,645,579 ) Weighted average common shares outstanding – basic and fully diluted 3,678,459 3,220,528 Net loss per common share – basic and fully diluted $ (0.22 ) $ (0.82 ) |
6. Fair Value of Financial In_2
6. Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Valuation of financial instruments at fair value | The following schedule summarizes the valuation of financial instruments at fair value on a recurring basis in the balance sheets as of March 31, 2021 and December 31, 2020: Fair Value Measurements at March 31, 2021 Level 1 Level 2 Level 3 Assets Cash and cash equivalents $ 2,546,113 $ – $ – Investment in Allied Esports Entertainment, Inc. 511,140 – – Goodwill 6,411,327 – – Total assets 9,468,580 – – Liabilities Notes payable – 150,000 – Total liabilities – 150,000 – $ 9,468,580 $ (150,000 ) $ – Fair Value Measurements at December 31, 2020 Level 1 Level 2 Level 3 Assets Cash and cash equivalents $ 1,912,729 $ – $ – Investment in Allied Esports Entertainment, Inc. 280,417 – – Goodwill 6,411,327 – – Total assets 8,604,473 – – Liabilities Notes payable – 262,925 – Total liabilities – 262,925 – $ 8,604,473 $ (262,925 ) $ – |
7. Prepaid Expenses (Tables)
7. Prepaid Expenses (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of prepaid expenses | Prepaid expenses consists of the following: March 31, December 31, 2021 2020 Prepaid software licenses $ 15,282 $ 26,853 Prepaid insurance costs 8,421 11,325 Prepaid employee benefits 500 8,082 Prepaid office and other costs 28,972 10,167 Total prepaid expenses $ 53,175 $ 56,427 |
8. Property and Equipment (Tabl
8. Property and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Property and equipment: | |
Property and equipment | Property and equipment at March 31, 2021 and December 31, 2020, consists of the following: March 31, December 31, 2021 2020 Office equipment $ 13,873 $ 5,042 Machinery 131,031 183,680 Software 70,000 49,000 Website 320,798 259,772 Construction in progress 2,298,227 1,639,690 2,833,929 2,137,184 Less: Accumulated depreciation and amortization (7,608 ) (2,612 ) Total property and equipment, net $ 2,826,321 $ 2,134,572 |
9. Investments in Allied Espo_2
9. Investments in Allied Esports Entertainment, Inc. (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Investments, All Other Investments [Abstract] | |
Schedule of unrealized loss on investment | As of March 31, 2021, the market value of the Company’s investment in AESE’s common stock was $511,140, based on the closing stock price of $2.88 per share, resulting in losses on our investment in securities, as follows: March 31, March 31, 2021 2020 Net gain (loss) on investment in Allied Esports Entertainment, Inc. securities $ 230,723 $ (2,212,852 ) Less: Net gains and losses recognized on equity securities sold during the period – – Unrealized gains (losses) recognized on equity securities still held at the end of the period $ 230,723 $ (2,212,852 ) |
10. Leases (Tables)
10. Leases (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Schedule of components of lease expense | The components of lease expense were as follows: For the Three Months Ended March 31, 2021 Operating lease cost: Fixed rent expense $ 36,720 |
Schedule of supplemental balance sheet information | Supplemental balance sheet information related to leases was as follows: March 31, 2021 Operating leases: Operating lease assets $ 1,378,133 Current portion of operating lease liabilities $ 41,353 Noncurrent operating lease liabilities 1,388,927 Total operating lease liabilities $ 1,430,280 Weighted average remaining lease term: Operating leases 14.75 years Weighted average discount rate: Operating leases 5.75% |
Schedule of supplemental cash flow and other information | Supplemental cash flow and other information related to leases was as follows: For the Three Months Ended 2021 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows used for operating leases $ 9,458 Leased assets obtained in exchange for lease liabilities: Total operating lease liabilities $ 1,430,280 |
Schedule of future minimum lease payments | The future minimum lease payments due under operating leases as of March 31, 2021 was as follows: Fiscal Year Ending Minimum Lease December 31, Commitments 2021 (for the nine months remaining) $ 91,530 2022 125,287 2023 129,046 2024 132,917 2025 1,690,905 2,169,685 Less effects of discounting 739,405 Lease liability recognized $ 1,430,280 |
11. Notes Payable (Tables)
11. Notes Payable (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of notes payable | Notes payable consists of the following at March 31, 2021 and December 31, 2020, respectively: March 31, December 31, 2021 2020 On June 16, 2020, the Company entered into a loan authorization and loan agreement with the United States Small Business Administration (the “SBA”), as lender, pursuant to the SBA’s Economic Injury Disaster Loan (“EIDL”) assistance program in light of the impact of the COVID-19 pandemic on the Company’s business (the “EIDL Loan Agreement”) encompassing a $150,000 Promissory Note issued to the SBA (the “EIDL Note”)(together with the EIDL Loan Agreement, the “EIDL Loan”), bearing interest at 3.75% per annum. In connection with entering into the EIDL Loan, the Company also executed a security agreement, dated June 16, 2020, between the SBA and the Company (the “EIDL Security Agreement”) pursuant to which the EIDL Loan is secured by a security interest on all of the Company’s assets. Under the EIDL Note, the Company is required to pay principal and interest payments of $731 every month beginning June 16, 2021. All remaining principal and accrued interest is due and payable on June 16, 2050. The EIDL Note may be repaid at any time without penalty. $ 150,000 $ 150,000 On April 24, 2020, the Company entered into a loan agreement with Kensington Bank (“Kensington”), as lender (the “Loan Agreement”) encompassing a $112,925 Promissory Note issued to Kensington (the “PPP Note”) pursuant to Payroll Protection Program established as part of the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), which provides loans to qualifying businesses and is administered by the U.S. Small Business Administration (the “SBA”). The PPP Note bears interest at 1.00% per annum, with interest payable monthly beginning November 24, 2020, and principal due in full on April 24, 2022. The PPP Note could have been repaid at any time without penalty. Under the Payroll Protection Program, the Company received loan forgiveness of $113,772, consisting of $112,925 of principal and $847 of accrued interest, on January 19, 2021. The forgiveness amount was equal to the amount that the Company spends during the 24-week period beginning April 24, 2020 on payroll costs, payment of rent on any leases in force prior to February 15, 2020 and payment on any utility for which service began before February 15, 2020. The maximum amount of loan forgiveness for non-payroll expenses was 40% of the amount of the PPP Note. – 112,925 Total notes payable 150,000 262,925 Less unamortized derivative discounts: – – Notes payable 150,000 262,925 Less: current maturities – – Notes payable, less current maturities $ 150,000 $ 262,925 |
16. Commitments (Tables)
16. Commitments (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of future minimum lease payments | The future minimum lease payments due under operating leases as of March 31, 2021 is as follows: Fiscal Year Ending Minimum Lease December 31, Commitments 2021 $ 91,530 2022 125,287 2023 129,046 2024 132,917 2025 1,690,905 $ 2,169,685 Less effects of discounting 739,405 Lease liability recognized $ 1,430,280 |
1. Organization and Nature of_2
1. Organization and Nature of Business (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Mar. 31, 2021 | Mar. 31, 2020 | Oct. 10, 2017 | Sep. 26, 2017 | May 06, 2021 | Oct. 01, 2020 | |
Proceeds from sale of equity | $ 2,525,000 | $ 0 | ||||
S-FDF, LLC [Member] | ||||||
Cash and assets acquired in acquisition | $ 2,200,000 | |||||
AESE [Member] | Subsequent Event [Member] | ||||||
Investment shares owned | 177,479 | |||||
Investment shares owned, fair value | $ 425,950 | |||||
Equity Raise [Member] | ||||||
Stock issued new, shares | 1,439,400 | |||||
Proceeds from sale of equity | $ 5,051,675 | |||||
IPO [Member] | BRAC [Member] | Over Allotment Option [Member] | ||||||
Proceeds from IPO | $ 138,000,000 | |||||
Private Placement [Member] | BRAC [Member] | ||||||
Proceeds from sale of equity | $ 4,450,000 | |||||
Units bought | 445,000 | |||||
Unit price | $ 10 | |||||
Ownership percentage | 22.00% |
2. Summary of Significant Accou
2. Summary of Significant Accounting Policies (Details - Estimated Useful Lives) | 3 Months Ended |
Mar. 31, 2021 | |
Software [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 3 years, or over the life of the agreement |
Office Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 5 years |
Furniture and Fixtures [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 5 years |
Machinery and Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 7-10 years |
Intangible Assets [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 10 years |
Leasehold Improvements [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | Fully extended lease-term |
2. Summary of Significant Acc_2
2. Summary of Significant Accounting Policies (Details - Inventory) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Accounting Policies [Abstract] | ||
Raw materials | $ 116,228 | $ 141,371 |
Work in progress | 314,018 | 0 |
Packaging materials | 26,618 | 0 |
Inventory | $ 456,864 | $ 141,371 |
2. Summary of Significant Acc_3
2. Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Accounting Policies [Abstract] | |||
Cash equivalents | $ 0 | $ 0 | |
Cash uninsured amount | 1,647,593 | ||
Depreciation expense | 4,996 | $ 271 | |
Stock-based compensation | 375,891 | 21,489 | |
Amortization of warrants | $ 0 | $ 13,795 |
3. Going Concern (Details Narra
3. Going Concern (Details Narrative) - USD ($) | May 06, 2021 | Mar. 31, 2021 | Dec. 31, 2020 |
Accumulated deficit | $ (37,486,215) | $ (36,678,338) | |
Liquid securities | 0 | $ 0 | |
Subsequent Event [Member] | AESE [Member] | |||
Cash on hand | $ 1,862,434 | ||
Investment shares owned, fair value | $ 425,950 | ||
Cash and Cash Equivalents [Member] | |||
Liquid securities | $ 3,057,253 |
4. Business Combination, S-FD_2
4. Business Combination, S-FDF (Details - Recognized Identifiable Assets Acquired and Liabilities Assumed) - USD ($) | Mar. 31, 2021 | Oct. 01, 2020 | |
Fair value of identifiable assets acquired assumed: | |||
Consideration paid in excess of fair value (Goodwill) | $ 6,411,327 | ||
S-FDF, LLC [Member] | |||
Consideration: | |||
Fair value of 1,620,973 shares of common stock | $ 8,573,600 | ||
Liabilities assumed: | |||
Accounts payable | 137,113 | ||
Accrued expenses | 79,467 | ||
Lease liabilities | 1,449,061 | ||
Total consideration | 10,239,241 | ||
Fair value of identifiable assets acquired assumed: | |||
Cash | 1,154,459 | ||
Other receivables | 17,348 | ||
Prepaid expenses | 150,524 | ||
Property and equipment | 239,868 | ||
Construction in progress | 845,579 | ||
Security deposit | 10,000 | ||
Right-of-use asset | 1,410,136 | ||
Total fair value of assets assumed | 3,827,914 | ||
Consideration paid in excess of fair value (Goodwill) | [1] | $ 6,411,327 | |
[1] | The consideration paid in excess of the net fair value of assets acquired and liabilities assumed was recognized as goodwill. The book value of the net assets acquired was determined to represent the fair market value, and no additional intangible assets were evidenced. |
4. Business Combination, S-FD_3
4. Business Combination, S-FDF (Details - Pro Forma Results) - USD ($) | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | ||
Weighted average common shares outstanding - basic and fully diluted | 3,661,760 | 1,600,424 | |
Net loss per common share - basic and fully diluted | $ (0.22) | $ (1.65) | |
S-FDF, LLC [Member] | |||
Revenues | $ 0 | $ 0 | [1] |
Net operating loss | (1,150,860) | (417,618) | [1] |
Net loss | $ (807,877) | $ (2,645,579) | [1] |
Weighted average common shares outstanding - basic and fully diluted | 3,678,459 | 3,220,528 | [1] |
Net loss per common share - basic and fully diluted | $ (0.22) | $ (0.82) | [1] |
[1] | S-FDF, LLC was formed on May 4, 2020, therefore pro forma operation for 2019 are identical to the Companys actual results, other than the basic and fully diluted net income per share amounts. |
4. Business Combination, S-FD_4
4. Business Combination, S-FDF (Details Narrative) - USD ($) | Jan. 04, 2021 | Oct. 01, 2020 | Mar. 31, 2021 | |
Goodwill | $ 6,411,327 | |||
S-FDF, LLC [Member] | ||||
Cash and assets acquired in acquisition | $ 2,200,000 | |||
Shares issued | 500,973 | 1,120,000 | ||
Business combination | 46.00% | |||
Goodwill | [1] | $ 6,411,327 | ||
[1] | The consideration paid in excess of the net fair value of assets acquired and liabilities assumed was recognized as goodwill. The book value of the net assets acquired was determined to represent the fair market value, and no additional intangible assets were evidenced. |
5. Related Party (Details Narra
5. Related Party (Details Narrative) - USD ($) | Jan. 07, 2021 | Jan. 04, 2021 | Feb. 05, 2021 | Jan. 31, 2021 | Jan. 27, 2021 | Feb. 28, 2021 | Apr. 06, 2021 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 |
Shares issued for services, value | $ 254,670 | |||||||||
Common stock payable, shares | 11,585 | 535,729 | ||||||||
Common stock payable, value | $ 72,869 | $ 1,982,197 | ||||||||
Stock issued new, value | 1,625,000 | |||||||||
Share based compensation | 375,891 | $ 21,489 | ||||||||
Claudia Goldfarb [Member] | ||||||||||
Shares issued for services, shares | 16,623 | 5,541 | 5,541 | |||||||
Shares issued for services, value | $ 29,035 | $ 38,787 | $ 34,853 | |||||||
Common stock payable, shares | 5,541 | |||||||||
Options granted | 75,000 | |||||||||
Options granted, weighted average exercise price | $ 3.70 | |||||||||
Term | 10 years | |||||||||
Volatility Rate | 198.00% | |||||||||
Call option value | $ 591,178 | |||||||||
Share based compensation | $ 46,430 | |||||||||
Claudia Goldfarb [Member] | Subsequent Event [Member] | ||||||||||
Shares issued for services, shares | 5,541 | |||||||||
Ira Goldfarb [Member] | ||||||||||
Shares issued for services, shares | 18,133 | 6,044 | 6,044 | |||||||
Shares issued for services, value | $ 31,671 | $ 42,308 | $ 38,016 | |||||||
Common stock payable, shares | 6,044 | |||||||||
Options granted | 75,000 | |||||||||
Options granted, weighted average exercise price | $ 3.70 | |||||||||
Term | 10 years | |||||||||
Volatility Rate | 198.00% | |||||||||
Call option value | $ 591,178 | |||||||||
Share based compensation | $ 46,430 | |||||||||
Ira Goldfarb [Member] | Subsequent Event [Member] | ||||||||||
Shares issued for services, shares | 6,044 | |||||||||
Ludeman [Member] | ||||||||||
Shares issued for services, shares | 6,400 | |||||||||
Shares issued for services, value | $ 40,000 | |||||||||
Options granted | 24,151 | |||||||||
Options granted, weighted average exercise price | $ 6.25 | |||||||||
Term | 10 years | |||||||||
Volatility Rate | 198.00% | |||||||||
Call option value | $ 149,239 | |||||||||
Share based compensation | $ 327 | |||||||||
Asset Purchase Agreement [Member] | Sponsor Shares [Member] | ||||||||||
Common stock payable, shares | 500,973 | |||||||||
Common stock payable, value | $ 1,853,600 | |||||||||
Stock issued new, shares | 500,973 | |||||||||
Stock Purchase Agreement [Member] | ||||||||||
Share price | $ 4 | |||||||||
Stock issued new, shares | 631,250 | |||||||||
Stock issued new, value | $ 2,525,000 | |||||||||
Stock Purchase Agreement [Member] | Officers and Directors [Member] | ||||||||||
Stock issued new, shares | 225,000 | |||||||||
Stock issued new, value | $ 900,000 |
6. Fair Value of Financial In_3
6. Fair Value of Financial Instruments (Details) - Fair Value, Measurements, Recurring [Member] - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Fair Value Inputs Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of assets | $ 9,468,580 | $ 8,604,473 |
Fair value of liabilities | 0 | 0 |
Fair value of asset after deduction of liability | 9,468,580 | 8,604,473 |
Fair Value Inputs Level 1 [Member] | Cash and Cash Equivalents [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of assets | 2,546,113 | 1,912,729 |
Fair Value Inputs Level 1 [Member] | Investment [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of assets | 511,140 | 280,417 |
Fair Value Inputs Level 1 [Member] | Goodwill [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of assets | 6,411,327 | 6,411,327 |
Fair Value Inputs Level 1 [Member] | Notes payable [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of liabilities | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of assets | 0 | 0 |
Fair value of liabilities | 150,000 | 262,925 |
Fair value of asset after deduction of liability | (150,000) | (262,925) |
Fair Value, Inputs, Level 2 [Member] | Cash and Cash Equivalents [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of assets | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | Investment [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of assets | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | Goodwill [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of assets | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | Notes payable [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of liabilities | 150,000 | 262,925 |
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of assets | 0 | 0 |
Fair value of liabilities | 0 | 0 |
Fair value of asset after deduction of liability | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | Cash and Cash Equivalents [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of assets | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | Investment [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of assets | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | Goodwill [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of assets | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | Notes payable [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of liabilities | $ 0 | $ 0 |
7. Prepaid Expenses (Details)
7. Prepaid Expenses (Details) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid software licenses | $ 15,282 | $ 26,853 |
Prepaid insurance costs | 8,421 | 11,325 |
Prepaid employee benefits | 500 | 8,082 |
Prepaid office and other costs | 28,972 | 10,167 |
Total prepaid expenses | $ 53,175 | $ 56,427 |
8. Property and Equipment (Deta
8. Property and Equipment (Details-Property and equipment) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Property and equipment plus construction in progress | $ 2,833,929 | $ 2,137,184 |
Less: Accumulated depreciation and amortization | (7,608) | (2,612) |
Total property and equipment, net | 2,826,321 | 2,134,572 |
Office Equipment [Member] | ||
Property and equipment plus construction in progress | 13,873 | 5,042 |
Machinery [Member] | ||
Property and equipment plus construction in progress | 131,031 | 183,680 |
Software [Member] | ||
Property and equipment plus construction in progress | 70,000 | 49,000 |
Website [Member] | ||
Property and equipment plus construction in progress | 320,798 | 259,772 |
Construction in Progress [Member] | ||
Property and equipment plus construction in progress | $ 2,298,227 | $ 1,639,690 |
8. Property and Equipment (De_2
8. Property and Equipment (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Sep. 30, 2020 | |
Property and equipment: | |||
Loss on disposal of fixed assets | $ (5,369) | ||
Depreciation expense | $ 4,996 | $ 271 |
9. Investments in Allied Espo_3
9. Investments in Allied Esports Entertainment, Inc. (Details - Gains and losses on investment ) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Investments In Allied Esports Entertainment Inc. | ||
Net gain (loss) on investment in Allied Esports Entertainment, Inc. securities | $ 230,723 | $ (2,212,852) |
Less: Net gains and losses recognized on equity securities sold during the period | 0 | 0 |
Unrealized gains (losses) recognized on equity securities still held at the end of the period | $ 230,723 | $ (2,212,852) |
9. Investments in Allied Espo_4
9. Investments in Allied Esports Entertainment, Inc. (Details Narrative) - USD ($) | 7 Months Ended | ||||
Aug. 09, 2020 | Mar. 31, 2021 | Dec. 31, 2020 | Aug. 10, 2020 | Aug. 09, 2019 | |
Investment in Allied Esports Entertainment, Inc | $ 511,140 | $ 280,417 | |||
AESE [Member] | Employees and Directors [Member] | |||||
Investment shares owned | 537,101 | ||||
Investment shares owned, fair value | $ 1,133,281 | ||||
AESE [Member] | |||||
Investment in Allied Esports Entertainment, Inc | $ 511,140 | ||||
AESE [Member] | Warrants [Member] | |||||
Investment shares sold | 505,000 | ||||
Proceeds from sale of investment shares | $ 73,668 | ||||
AESE [Member] | AESE Common Stock [Member] | |||||
Investment shares owned | 2,685,000 | ||||
Investment shares owned, fair value | $ 11,950,475 | ||||
AESE [Member] | Sponsor Warrants [Member] | |||||
Investment shares owned | 505,000 | ||||
AESE [Member] | Sponsor Shares [Member] | |||||
Investment shares owned | 177,479 | ||||
Investment shares sold | 1,970,920 | ||||
Proceeds from sale of investment shares | $ 3,108,067 |
10. Leases (Details - Lease exp
10. Leases (Details - Lease expense) | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Leases [Abstract] | |
Operating lease cost | $ 36,720 |
10. Leases (Details - Supplemen
10. Leases (Details - Supplemental balance sheet information) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Operating leases: | ||
Operating lease assets | $ 1,378,133 | $ 1,394,202 |
Current portion of operating lease liabilities | 41,353 | 39,870 |
Noncurrent operating lease liabilities | 1,388,927 | $ 1,399,868 |
Total operating lease liabilities | $ 1,430,280 | |
Weighted average remaining lease term Operating leases | 14 years 9 months | |
Weighted average discount rate Operating leases | 5.75% |
10. Leases (Details - Other inf
10. Leases (Details - Other information) | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Cash paid for amounts included in the measurement of lease liabilities: | |
Operating cash flows used for operating leases | $ 9,458 |
Leased assets obtained in exchange for lease liabilities: | |
Total operating lease liabilities | $ 1,430,280 |
10. Leases (Details - Future mi
10. Leases (Details - Future minimum lease payments) | Mar. 31, 2021USD ($) |
Leases [Abstract] | |
2021 | $ 91,530 |
2022 | 125,287 |
2023 | 129,046 |
2024 | 132,917 |
2025 | 1,690,905 |
Total | 2,169,685 |
Less effects of discounting | 739,405 |
Lease liability recognized | $ 1,430,280 |
10. Leases (Details Narrative)
10. Leases (Details Narrative) | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Leases [Abstract] | |
Lease expiration date | Aug. 31, 2025 |
Monthly lease payment | $ 10,036 |
11. Notes Payable (Details)
11. Notes Payable (Details) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Total notes payable | $ 150,000 | $ 262,925 |
Less unamortized derivative discounts: | 0 | 0 |
Notes payable | 150,000 | 262,925 |
Less: current maturities | 0 | 0 |
Notes payable, less current maturities | 150,000 | 262,925 |
Notes Payable 1 [Member] | ||
Total notes payable | 150,000 | 150,000 |
Notes Payable 2 [Member] | ||
Total notes payable | $ 0 | $ 112,925 |
11. Notes Payable (Details Narr
11. Notes Payable (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | |||
Jan. 19, 2021 | Mar. 31, 2021 | Mar. 31, 2020 | Jun. 16, 2020 | Apr. 24, 2020 | |
Proceeds from note payable | $ 0 | $ 387,100 | |||
Repayment of note payable | 0 | 122,100 | |||
Gain on extinguishment of debt | 113,772 | 0 | |||
Notes Payable [Member] | |||||
Interest expense | $ 1,512 | 15,109 | |||
Notes Payable [Member] | Interest [Member] | |||||
Interest expense | 1,314 | ||||
Notes Payable [Member] | Stock-based warrant expense [Member] | |||||
Interest expense | $ 13,795 | ||||
Notes Payable 1 [Member] | EIDL [Member] | |||||
Debt face amount | $ 150,000 | ||||
Debt interest rate description | 3.75% per annum | ||||
Debt maturity date | Jun. 16, 2050 | ||||
Payment frequency | Monthly | ||||
Periodic payment amount | $ 731 | ||||
Notes Payable 2 [Member] | PPP Note [Member] | Kensington Bank [Member] | |||||
Debt face amount | $ 112,925 | ||||
Debt interest rate description | 1.00% per annum | ||||
Debt maturity date | Apr. 24, 2022 | ||||
Gain on extinguishment of debt | $ 113,772 |
12. Changes in Stockholders' _2
12. Changes in Stockholders' Equity (Details Narrative) - USD ($) | Jan. 07, 2021 | Jan. 04, 2021 | Feb. 05, 2021 | Jan. 31, 2021 | Jan. 27, 2021 | Feb. 28, 2021 | Feb. 21, 2020 | Mar. 31, 2021 | Dec. 31, 2020 |
Preferred stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 | |||||||
Preferred stock, shares authorized | 20,000,000 | 20,000,000 | |||||||
Common stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 | |||||||
Common stock, shares authorized | 500,000,000 | 500,000,000 | |||||||
Common stock, shares issued | 3,939,439 | 2,742,890 | |||||||
Reverse stock split | On February 21, 2020, the Company effected a 1-for-300 reverse stock split | ||||||||
Shares issued for services, value | $ 254,670 | ||||||||
Common stock sold for cash, amount | 1,625,000 | ||||||||
Claudia Goldfarb [Member] | |||||||||
Shares issued for services, shares | 16,623 | 5,541 | 5,541 | ||||||
Shares issued for services, value | $ 29,035 | $ 38,787 | 34,853 | ||||||
Ira Goldfarb [Member] | |||||||||
Shares issued for services, shares | 18,133 | 6,044 | 6,044 | ||||||
Shares issued for services, value | $ 31,671 | $ 42,308 | $ 38,016 | ||||||
Ludeman [Member] | |||||||||
Shares issued for services, shares | 6,400 | ||||||||
Shares issued for services, value | $ 40,000 | ||||||||
Asset Purchase Agreement [Member] | Sponsor Shares [Member] | |||||||||
Shares issued for acquisition, shares | 500,973 | ||||||||
Shares issued for acquisition, value | $ 1,853,600 | ||||||||
Common stock sold for cash, Shares | 500,973 | ||||||||
Stock Purchase Agreement [Member] | |||||||||
Common stock sold for cash, Shares | 631,250 | ||||||||
Common stock sold for cash, amount | $ 2,525,000 | ||||||||
Share price | $ 4 |
13. Options (Details Narrative)
13. Options (Details Narrative) - USD ($) | Jan. 04, 2021 | Jan. 27, 2021 | Mar. 31, 2021 | Mar. 31, 2020 |
Share based compensation | $ 375,891 | $ 21,489 | ||
Ludeman [Member] | ||||
Options term | 10 years | |||
Options granted | 24,151 | |||
Options granted, weighted average exercise price | $ 6.25 | |||
Volatility rate | 198.00% | |||
Call option value | $ 149,239 | |||
Share based compensation | 327 | |||
Claudia Goldfarb [Member] | ||||
Options term | 10 years | |||
Options granted | 75,000 | |||
Options granted, weighted average exercise price | $ 3.70 | |||
Volatility rate | 198.00% | |||
Call option value | $ 591,178 | |||
Share based compensation | 46,430 | |||
Ira Goldfarb [Member] | ||||
Options term | 10 years | |||
Options granted | 75,000 | |||
Options granted, weighted average exercise price | $ 3.70 | |||
Volatility rate | 198.00% | |||
Call option value | $ 591,178 | |||
Share based compensation | $ 46,430 | |||
Stock Options [Member] | ||||
Options outstanding | 621,635 | |||
Options term | 9 years 3 months 22 days | |||
Strike Price | $ 5.83 | |||
Share based compensation | $ 121,221 | $ 21,489 | ||
Unamortized share based compensation | $ 2,053,560 | |||
Options Cancelled or Forfeited | 12,039 | |||
Exercise price, Cancelled or Forfeited | $ 90 | |||
Options exercised | 0 |
14. Warrants (Details Narrative
14. Warrants (Details Narrative) - Warrants [Member] - $ / shares | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Warrants Outstanding | 106,300 | |
Warrant exercise price | $ 3.99 | |
Weighted average life | 8 years 10 months 10 days | |
Warrant granted' | 0 | 0 |
Warrants exercised | 0 | 0 |
15. Income Taxes (Details Narra
15. Income Taxes (Details Narrative) | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Income Tax Disclosure [Abstract] | |
Net deferred tax assets | $ 5,658,442 |
Valuation allowance | 5,658,442 |
Tax expense | $ 0 |
16. Commitments (Details)
16. Commitments (Details) | Mar. 31, 2021USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2021 | $ 91,530 |
2022 | 125,287 |
2023 | 129,046 |
2024 | 132,917 |
2025 | 1,690,905 |
Total | 2,169,685 |
Less effects of discounting | 739,405 |
Lease liability recognized | $ 1,430,280 |
16. Commitments (Details Narrar
16. Commitments (Details Narrartive) | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | |
Lease expiration date | Aug. 31, 2025 |
Rent expenses | $ 10,036 |