Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Dec. 31, 2019 | Feb. 14, 2020 | |
Document And Entity Information | ||
Entity Registrant Name | Applied BioSciences Corp. | |
Entity Central Index Key | 0001607549 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Current Fiscal Year End Date | --03-31 | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Emerging Growth Company | true | |
Entity Current Reporting Status | Yes | |
Document Period End Date | Dec. 31, 2019 | |
Entity Filer Category | Non-accelerated Filer | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2020 | |
Entity Ex Transition Period | false | |
Entity Common Stock Shares Outstanding | 14,292,956 | |
EntityFileNumber | 000-55523 | |
EntityAddressAddressLine1 | 9701 Wilshire Blvd. | |
EntityAddressAddressLine2 | Suite 1000 | |
EntityAddressPostalZipCode | 90212 | |
EntityTaxIdentificationNumber | 811699502 | |
EntityAddressCityOrTown | Beverly Hills | |
LocalPhoneNumber | 3567374 | |
CityAreaCode | 310 | |
EntityAddressStateOrProvince | CALIFORNIA |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2019 | Mar. 31, 2019 |
Current Assets | ||
Cash | $ 21,268 | $ 47,044 |
Accounts receivable, net | 76,201 | 163,405 |
Inventory | 101,524 | 78,737 |
Prepaids and other current assets | 14,666 | 65,273 |
Total Current Assets | 213,659 | 354,459 |
Property and equipment, net | 331,323 | 452,048 |
Operating lease right-of-use assets, net | 350,752 | |
Equity investments | 570,911 | 898,292 |
Goodwill (provisional) | 1,941,149 | 1,941,149 |
Other asset | 10,133 | 5,500 |
TOTAL ASSETS | 3,417,927 | 3,651,448 |
Current Liabilities | ||
Accounts payable | 659,682 | 278,546 |
Note Payable | 25,000 | 25,000 |
Convertible note payable - related party | 192,000 | |
Convertible note payable - unrelated parties, net of debt discount of $153,170 at December 31, 2019 | 346,769 | |
Derivative liability | 234,058 | |
Current portion of operating lease liabilities | 89,136 | |
Accrued expenses | 472,131 | 70,720 |
Total Current Liabilities | 2,018,776 | 374,266 |
Operating lease liabilities, net of current portion | 261,616 | |
Total Liabilities | 2,280,392 | 374,266 |
Commitments and Contingencies | ||
Stockholders' Equity | ||
Preferred stock; $0.00001 par value; 5,000,000 shares authorized; none issued and outstanding at December 31, 2019 (unaudited) and 2018 and March 31, 2019, respectively | ||
Common stock; $0.00001 par value; 200,000,000 shares authorized: 14,100,956 issued and outstanding at December 31, 2019 (unaudited) and 13,397,110 at March 31, 2019 | 143 | 135 |
Additional paid in capital | $ 7,321,615 | $ 6,892,242 |
Common stock to be issued, 808,805 shares at December 31, 2019 (unaudited) and 408,805 shares at March 31, 2019 | 993,807 | 773,807 |
Accumulated deficit | $ (8,086,293) | $ (5,531,260) |
Total Applied BioSciences Corp. Stockholders' Equity | 229,272 | 2,134,924 |
Non-controlling equity | 908,263 | 1,142,258 |
Total Stockholders' Equity | 1,137,535 | 3,277,182 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 3,417,927 | $ 3,651,448 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Dec. 31, 2019 | Mar. 31, 2019 |
Current Liabilities | ||
Unrelated parties net of debt discount | $ 153,170 | |
Stockholders' Equity | ||
Preferred stock, shares par value | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, shares par value | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares issued | 14,100,956 | 13,397,110 |
Common stock, shares outstanding | 14,100,956 | 13,397,110 |
Common stock shares to be issued | 808,805 | 408,805 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
REVENUE, NET | ||||
Products | $ 22,357 | $ 413,109 | $ 192,011 | $ 472,509 |
Services | 147,218 | 433,295 | ||
Total revenues, net | 169,575 | 413,109 | 625,306 | 472,509 |
COST OF REVENUE | ||||
Products | 17,137 | 379,582 | 167,546 | 439,740 |
Services | 34,206 | 81,967 | ||
Total costs of revenue | 51,343 | 379,582 | 249,513 | 439,740 |
GROSS MARGIN | 118,232 | 33,527 | 375,793 | 32,769 |
EXPENSES | ||||
Sales and marketing | 50,590 | 100,730 | 256,775 | 556,167 |
General and administrative | 997,055 | 1,317,469 | 2,271,546 | 1,712,667 |
Depreciation and amortization | 40,828 | 292 | 120,324 | 877 |
TOTAL OPERATING EXPENSES | 1,088,473 | 1,418,491 | 2,648,645 | 2,269,711 |
OPERATING LOSS | (970,241) | (1,384,964) | (2,272,852) | (2,236,942) |
Other Income (Expense) | ||||
Change in fair value of equity investments | (327,381) | (327,381) | 404,763 | |
Change in fair value of derivative | (39,231) | (34,977) | ||
Interest Expense | (89,017) | (506,579) | (153,818) | (574,880) |
Total other (expense), net | (455,629) | (506,579) | (516,176) | (170,117) |
NET LOSS | (1,425,870) | (1,891,543) | (2,789,028) | (2,407,059) |
Less: Net income (loss) attributable to non controlling interest | 72,480 | (234) | 233,995 | 9,358 |
NET LOSS ATTRIBUTABLE TO APPLIED BIOSCIENCES CORP. | $ (1,353,390) | $ (1,891,777) | $ (2,555,033) | $ (2,397,701) |
LOSS PER COMMON SHARE | $ (0.10) | $ (0.16) | $ (0.19) | $ (0.22) |
WEIGHTED AVERAGE SHARES OUTSTANDING | ||||
Basic and diluted | 13,649,254 | 11,797,297 | 13,555,111 | 11,150,168 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS EQUITY (unaudited) - USD ($) | Total | Common Stock [Member] | Common Stock To Be Issued [Member] | Additional Paid-in Capital [Member] | Noncontrolling Interest [Member] | Accumulated Deficit [Member] |
Balance, shares at Mar. 31, 2018 | 10,499,610 | |||||
Balance, amount at Mar. 31, 2018 | $ 669,442 | $ 105 | $ 526,000 | $ 3,054,297 | $ (9,027) | $ (2,901,933) |
Fair value of shares issued to consultant for services, amount | 225,926 | 1 | 45,926 | 179,999 | ||
Net loss | (401,757) | $ (6,256) | $ (395,501) | |||
Beneficial conversion feature associated with a convertible note | $ 28,705 | 28,705 | ||||
Fair value of shares issued to consultant for services, shares | 90,000 | |||||
Fair value of shares issued to advisory board member, shares | 25,000 | |||||
Fair value of shares issued to advisory board member, amount | $ 51,000 | 51,000 | ||||
Issuance of common stock previously committed but not issues, shares | 50,000 | |||||
Issuance of common stock for cash | $ 75,000 | 75,000 | ||||
Issuance of common stock previously committed but not issues, amount | $ 1 | $ (100,000) | $ 99,999 | |||
Balance, shares at Jun. 30, 2018 | 10,664,610 | |||||
Balance, amount at Jun. 30, 2018 | $ 648,316 | $ 107 | $ 546,926 | $ 3,414,000 | $ (15,283) | $ (3,297,434) |
Fair value of shares issued to consultant for services, amount | 15,926 | 15,926 | ||||
Net loss | (113,759) | $ (3,336) | $ (110,423) | |||
Beneficial conversion feature associated with a convertible note | 99,900 | 99,900 | ||||
Issuance of common stock previously committed but not issues, shares | 12,500 | |||||
Issuance of common stock previously committed but not issues, amount | $ (25,000) | $ 25,000 | ||||
Balance, shares at Sep. 30, 2018 | 10,677,110 | |||||
Balance, amount at Sep. 30, 2018 | $ 650,383 | $ 107 | $ 537,852 | $ 3,538,900 | $ (18,619) | $ (3,407,857) |
Fair value of shares issued to consultant for services, amount | 356,450 | $ 3 | 356,447 | |||
Net loss | (1,891,543) | $ 234 | $ (1,891,777) | |||
Beneficial conversion feature associated with a convertible note | $ 309,200 | 309,200 | ||||
Fair value of shares issued to consultant for services, shares | 295,000 | |||||
Conversion of convertible debt | $ 1,444,500 | $ 1,444,500 | ||||
Fair value of shares issued to Company Officers and board member, amount | $ 756,250 | $ 6 | $ 756,244 | |||
Fair value of shares issued to Company Officers and board member, shares | 625,000 | |||||
Balance, shares at Dec. 31, 2018 | 11,597,110 | |||||
Balance, amount at Dec. 31, 2018 | $ (1,625,240) | $ 116 | $ 1,982,352 | $ 4,960,791 | $ (18,385) | $ (5,299,634) |
Balance, shares at Mar. 31, 2019 | 13,397,110 | |||||
Balance, amount at Mar. 31, 2019 | $ 3,277,182 | $ 135 | $ 773,807 | $ 6,892,242 | $ 1,142,258 | $ (5,531,260) |
Net loss | (507,928) | $ (84,031) | $ (423,897) | |||
Beneficial conversion feature associated with a convertible note | $ 77,381 | 77,381 | ||||
Issuance of common stock previously committed but not issues, shares | 50,000 | |||||
Issuance of common stock previously committed but not issues, amount | $ 1 | $ (50,000) | $ 49,999 | |||
Balance, shares at Jun. 30, 2019 | 13,447,110 | |||||
Balance, amount at Jun. 30, 2019 | $ 2,846,635 | $ 136 | $ 723,807 | $ 7,019,622 | $ 1,058,227 | $ (5,955,157) |
Net loss | (855,230) | $ (77,484) | $ (777,746) | |||
Fair value of common stock issued upon conversion of convertible note | 100,000 | $ 100,000 | ||||
Fair value of common stock issued to former board member, shares | 100,000 | |||||
Fair value of common stock issued to former board member, amount | $ 70,000 | $ 1 | $ 69,999 | |||
Balance, shares at Sep. 30, 2019 | 13,547,110 | |||||
Balance, amount at Sep. 30, 2019 | $ 2,161,405 | $ 137 | $ 823,807 | $ 7,089,621 | $ 980,743 | $ (6,732,903) |
Net loss | $ (1,425,870) | $ (72,480) | $ (1,353,390) | |||
Fair value of common stock issued to officers, shares | 300,000 | |||||
Fair value of common stock issued to officers, amount | $ 81,000 | $ 3 | 80,997 | |||
Fair value of common stock issued upon conversion of convertible note, amount | $ 2 | (100,000) | 99,998 | |||
Fair value of common stock issued upon conversion of convertible note, shares | 153,846 | |||||
Fair value of common stock issued to consultants, amount | $ 321,000 | $ 1 | $ 270,000 | $ 50,999 | ||
Fair value of common stock issued to consultants, shares | 100,000 | |||||
Balance, shares at Dec. 31, 2019 | 14,100,956 | |||||
Balance, amount at Dec. 31, 2019 | $ 1,137,535 | $ 143 | $ 993,807 | $ 7,321,615 | $ 908,263 | $ (8,086,293) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) - USD ($) | 9 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net loss | $ (2,789,028) | $ (2,407,059) |
Adjustment to reconcile net loss to net cash used in operating activities: | ||
Change in fair value of equity investments | 327,381 | (404,763) |
Amortization of debt discount | 123,293 | 437,805 |
Change in fair value of derivative | 34,977 | |
Fair value of shares issued to consultants | 321,000 | 649,302 |
Fair value of shares issued to officers and board member | 151,000 | 756,250 |
Depreciation | 120,724 | 878 |
Allowance for bad debt | 33,457 | |
Amortization of operating lease right-of-use asset | 21,737 | |
Changes in operating assets and liabilities | ||
Repayment of lease obligations | (21,737) | |
Accounts receivable | 53,748 | (5,436) |
Inventory | (22,786) | (41,031) |
Prepaid and other current assets | 45,972 | 77,699 |
Accounts payable and accrued expenses | 782,547 | 147,492 |
Net cash used in operating activities | (817,715) | (788,863) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Deposit on acquisition | (550,000) | |
Net cash used in investing activities | (550,000) | |
CASH FLOW FROM FINANCING ACTIVITIES | ||
Proceeds from issuance of convertible notes | 791,939 | 1,444,500 |
Proceeds from issuance of common stock | 75,000 | |
Net cash provided by financing activities | 791,939 | 1,519,500 |
NET CHANGE IN CASH | (25,776) | 180,637 |
CASH, BEGINNING OF PERIOD | 47,044 | 60,934 |
CASH, END OF PERIOD | 21,268 | 241,571 |
NON-CASH INVESTING AND FINANCING ACTIVITIES | ||
Fair value of common stock issued upon conversion of convertible notes and accrued interest | 100,000 | 1,444,500 |
Fair value of beneficial conversion feature related to issuance of convertible notes | 77,381 | 437,805 |
Initial recognition of operating lease right-of-use assets and operating lease obligations under adoption of ASC Topic 842 | 372,490 | |
Recognition of derivative liability upon issuance of note payable | $ 199,081 |
NATURE OF OPERATIONS AND BASIS
NATURE OF OPERATIONS AND BASIS OF PRESENTATION | 9 Months Ended |
Dec. 31, 2019 | |
NATURE OF OPERATIONS AND BASIS OF PRESENTATION | |
NOTE 1 - NATURE OF OPERATIONS AND BASIS OF PRESENTATION | Description of the Company Applied BioSciences Corp. (formerly First Fixtures, Inc. and Stony Hill Corp. or the “Company”) was incorporated in the State of Nevada on February 21, 2014 and established a fiscal year end of March 31. The Company is a vertically integrated company focused on the development of science-driven cannabinoid therapeutics / biopharmaceuticals and delivering high-quality CBD products as well as state-of-the-art testing and analytics capabilities. Effective October 24, 2016 the Company changed its name from First Fixtures Inc. to Stony Hill Corp. and on March 6, 2018, the Company changed its name from Stony Hill Corp. to Applied BioSciences Corp. In January 2019, the Company closed on a purchase of 520,410 shares of common stock of Trace Analytics, Inc., a Washington corporation (“Trace Analytics”), for an aggregate purchase price of $1,250,000, of which $750,000 was paid in cash and $500,000 was paid in shares of common stock of the Company. Trace Analytics is a cannabis testing laboratory. Immediately following the purchase, the Company held 51% of the issued and outstanding shares of common stock of Trace Analytics and have included the financial results of Trace Analytics in the condensed consolidated financial statements from the date of acquisition, January 1, 2019. On April 8, 2019, the Company formed Applied Biopharma LLC, a wholly-owned subsidiary, in the state of Nevada, with the intention of establishing and growing the biopharmaceutical business of the Company. Applied Biopharma LLC is focused on the development and commercialization of novel therapeutics to treat metabolic diseases, peripheral neuropathy, progressive lung disease and ischemic reperfusion injury. Its principal business objective is to develop science-driven synthetic cannabinoid therapeutics that satisfy unmet medical needs and continue to drive innovation in the endocannabinoid space. Basis of presentation – Unaudited Financial Statements The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and the rules and regulations of the Securities and Exchange Commission. Accordingly, the unaudited condensed consolidated financial statements do not include all information and footnotes required by accounting principles generally accepted in the United States of America for complete annual financial statements. In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments, consisting of only normal recurring adjustments, considered necessary for a fair presentation. Interim operating results are not necessarily indicative of results that may be expected for the fiscal year ending March 31, 2020, or for any other interim period. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited financial statements as of and for the year ended March 31, 2019, which are included in the Company’s Report on Form 10-K for such year filed on July 1, 2019. Going concern These condensed statements have been prepared on a going concern basis which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. As reflected in the condensed consolidated financial statements, the Company incurred a net loss of $2,789,028 and used $817,715 of cash in operating activities during the nine months ended December 31, 2019. Further, the Company’s independent auditor in their audit report for fiscal year ended March 31, 2019 expressed substantial doubt about the Company’s ability to continue as a going concern. These and other factors raise substantial doubt about the Company's ability to continue as a going concern within one year after the date the financial statements are issued. The financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern. The Company’s ability to continue as a going concern is dependent upon its ability to raise additional capital and to ultimately achieve sustainable revenues and income from operations. During the nine months ended December 31, 2019, the Company issued convertible notes for total proceeds of $791,939 in private placements with accredited investors. However, the Company will need and is currently working on obtaining additional funds to operate its business through and beyond the date of this Form 10-Q filing. There is no assurance that such funds will be available or at terms acceptable to the Company. Even if the Company is able to obtain additional financing, it may contain undue restrictions and covenants on its operations, in the case of debt financing or cause substantial dilution for its stockholders in the case of convertible debt and equity financing. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Dec. 31, 2019 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | Principles of Consolidation The condensed consolidated financial statements include the accounts of the Company and its subsidiaries, Applied Products LLC (100% owned entity), VitaCBD LLC, an 80% owned entity, Trace Analytics, Inc., a 51% owned entity, all Washington limited liability companies, and Applied Biopharma LLC and SHL Management LLC, both 100% owned Nevada limited liability companies. Intercompany transactions and balances have been eliminated in consolidation. Management evaluates its investments on an individual basis for purposes of determining whether or not consolidation is appropriate. Use of Estimates and Assumptions Preparation of the condensed consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Among other things, management estimates include the collectability of its accounts receivable, recoverability of inventory, assumptions made in determining impairment of investments and intangible assets, accruals for potential liabilities, and realization of deferred tax assets. These estimates generally involve complex issues and require judgments, involve analysis of historical information and the prediction of future trends, and are subject to change from period to period. Actual amounts could differ significantly from these estimates. Revenue Recognition The Company’s revenue is principally derived from its subsidiaries, Applied Products LLC, and Trace Analytics. · Applied Products LLC revenues are generated from sales of high-quality CBD products for consumer and pet health and wellness. Sales of these products are made to individual distributors and through online sales. Revenue from the sale of these products was $192,011 and $472,509 during the nine months ended December 31, 2019 and 2018, respectively · Trace Analytics generates revenue from services by offering state-of-the-art testing and analytics capabilities to CBD and hemp companies. Sales of these services are to marijuana producers and processors, dispensaries, and CBD and hemp companies. Revenue from the sale of these services was $433,295 during the nine months ended December 31, 2019. The Company recognizes revenue in accordance with Financial Accounting Standards Board’s (“FASB”) Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers Advertising The Company expenses advertising costs as incurred. Advertising expense for the nine month periods ended December 31, 2019 and 2018 amounted to $37,144 and $40,769, respectively, and were included in “Sales and marketing expenses” in the Consolidated Statements of Operations. Earnings (Loss) per Share The basic earnings (loss) per share is calculated by dividing the Company’s net income (loss) available to common shareholders by the weighted average number of common shares during the period. Shares of common stock to be issued are included in weighted average shares calculation from the date of grant. The diluted earnings (loss) per share is calculated by dividing the Company’s net income (loss) available to common shareholders by the diluted weighted average number of shares outstanding during the period. The diluted weighted average number of shares outstanding is the basic weighted average number of shares adjusted for any potentially dilutive debt or equity. Diluted earnings (loss) per share are the same as basic earnings (loss) per share due to the lack of dilutive items. Investments The Company follows ASU 2016-01, Financial Instruments – Overall: Recognition and Measurement of Financial Assets and Financial Liabilities. ASU 2016-01 primarily affects equity investments, financial liabilities under the fair value option, and the presentation and disclosure requirements for financial instruments. Among other things, this guidance requires certain equity investments to be measured at fair value with changes in fair value recognized in net income. As such, the Company measures its equity investments at their fair value at end of each reporting period. Investments accounted for under the equity method or cost method of accounting above are included in the caption “Equity investments” on the Condensed Consolidated Balance Sheets. Goodwill Goodwill represents the excess of the purchase consideration over the fair value of the net tangible and identifiable intangible assets acquired in a business combination. The Company evaluates goodwill for impairment on an annual basis or whenever events and changes in circumstances suggest that the carrying amount may not be recoverable. The Company conducts its annual impairment analysis in the fourth quarter of each fiscal year. Impairment of goodwill is tested at the reporting unit level by comparing the reporting unit’s carrying amount, including goodwill, to the fair value of the reporting unit. Estimations and assumptions regarding the number of reporting units, future performances, results of the Company’s operations and comparability of its market capitalization and net book value will be used. If the carrying amount of the reporting unit exceeds its fair value, goodwill is considered impaired and an impairment loss is measured by the resulting amount. Because the Company has one reporting unit, as part of the Company’s qualitative assessment an entity-wide approach to assess goodwill for impairment is utilized. Based on management’s assessment, no impairment losses have been recorded in the nine month periods ended December 31, 2019. Stock Based Compensation The Company issues stock options and warrants, shares of common stock, and equity interests as share-based compensation to employees and non-employees. The Company accounts for its share-based compensation to employees in accordance with FASB ASC 718, Compensation – Stock Compensation. Stock-based compensation cost is measured at the grant date, based on the estimated fair value of the award, and is recognized as expense over the requisite service period. In prior periods up to March 31, 2019, the Company accounted for share-based compensation issued to non-employees and consultants in accordance with the provisions of FASB ASC 505-50, Equity - Based Payments to Non-Employees. Measurement of share-based payment transactions with non-employees is based on the fair value of whichever is more reliably measurable: (a) the goods or services received; or (b) the equity instruments issued. The final fair value of the share-based payment transaction is determined at the performance completion date. For interim periods, the fair value is estimated, and the percentage of completion is applied to that estimate to determine the cumulative expense recorded. In June 2018, the FASB issued ASU No. 2018-07, Compensation - Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. The guidance was issued to simplify the accounting for share-based transactions by expanding the scope of Topic 718 from only being applicable to share-based payments to employees to also include share-based payment transactions for acquiring goods and services from nonemployees. As a result, nonemployee share-based transactions will be measured by estimating the fair value of the equity instruments at the grant date, taking into consideration the probability of satisfying performance conditions. The Company adopted ASU 2018-07 on April 1, 2019. The adoption of the standard did not have a material impact on our financial statements for the three and nine months periods ended December 31, 2019 or the previously reported financial statements. Derivative Financial Instruments The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the condensed consolidated statements of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within 12 months of the balance sheet date. To determine the number of authorized but unissued shares available to satisfy outstanding convertible securities, the Company uses a sequencing method to prioritize its convertible securities as prescribed by ASC 815-40-35. At each reporting date, the Company reviews its convertible securities to determine their classification is appropriate. Leases Prior to April 1, 2019, the Company accounted for leases under ASC 840, Accounting for Leases Leases, Segments The Company operates in one segment for the distribution of products and services. In accordance with the “Segment Reporting” Topic of the ASC, the Company’s chief operating decision maker has been identified as the Chief Executive Officer, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. Existing guidance, which is based on a management approach to segment reporting, establishes requirements to report selected segment information quarterly and to report annually entity-wide disclosures about products and services, major customers, and the countries in which the entity holds material assets and reports revenue. All material operating units qualify for aggregation under “Segment Reporting” due to their similar customer base and similarities in: economic characteristics; nature of products and services; and procurement, manufacturing and distribution processes. Since the Company operates in one segment, all financial information required by “Segment Reporting” can be found in the accompanying condensed consolidated financial statements. Recent Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments (Topic 326), which replaces the incurred-loss impairment methodology and requires immediate recognition of estimated credit losses expected to occur for most financial assets, including trade receivables. Credit losses on available-for-sale debt securities with unrealized losses will be recognized as allowances for credit losses limited to the amount by which fair value is below amortized cost. ASU 2016-13 is effective for the Company beginning January 1, 2020 and early adoption is permitted. The Company does not believe the potential impact of the new guidance and related codification improvements will be material to its financial position, results of operations and cash flows. Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future consolidated financial statements. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 9 Months Ended |
Dec. 31, 2019 | |
PROPERTY AND EQUIPMENT | |
NOTE 3 - PROPERTY AND EQUIPMENT | Property and equipment consisted of the following: December 31, 2019 March 31, 2019 Lab Equipment $ 569,484 $ 569,484 Office Furniture and Equipment 57,562 57,562 Leasehold Improvements 21,557 21,557 648,603 648,603 Less: Accumulated Depreciation (317,280 ) (196,555 ) $ 331,323 $ 452,048 |
EQUITY INVESTMENTS
EQUITY INVESTMENTS | 9 Months Ended |
Dec. 31, 2019 | |
EQUITY INVESTMENTS | |
NOTE 4 - EQUITY INVESTMENTS | Equity investments relate to purchases of stock in certain entities with ownership percentages of less than 5% and consist of the following: December 31, 2019 March 31, 2019 (A) GemmaCert $ 93,529 $ 93,529 (B) Hightimes Holdings Corp. 327,382 654,763 (C) Precision Cultivation Systems, LLC 50,000 50,000 (D) Bailey Venture Partners XII LLC 100,000 100,000 $ 570,911 $ 898,292 (A) In November 2016, the Company purchased 29,571 shares of Preferred A stock of Cannabi-Tech Ltd. (“Cannabi”), at a price of $1.69086 per share for total investment of $50,000. Cannabi is a private company incorporated in the State of Israel that provides lab-grade medical cannabis quality control testing systems used to test the quality of medical marijuana flowers. Cannabi subsequently changed its name to GemmaCert. In October 2017, the Company purchased an additional 7,309 shares of Preferred A-1 stock of GemmaCert at a price of $2.536 per share for total investment of $18,537. As of March 31, 2019, the company valued these investments based on the most recent purchase price at $2.536 per share or total fair value of $93,529. As a private company, GemmaCert does not have a readily determinable fair value. Additionally, there have been no observable price changes from transactions for similar investments in GemmaCert during the nine months ended December 31, 2019. As such, the Company valued the investment at $2.536 per share, reflecting the most recent purchase price for total value of $93,529, which is believed to approximate market value. (B) In January 2017, the Company entered into an agreement to purchase 59,524 shares of Class A common stock at a price of $4.20 per share for total investment of $250,000, which accounts for less than 5% investment in Hightimes Holdings Corp. (“Hightimes”). Hightimes owns High Times Magazine and hosts festivals, events and competitions including the High Times Cannabis Cup and multiple e-commerce properties, including HighTimes.com, CannabisCup.com and 420.com. As of March 31, 2019, the Company was able to obtain observable evidence that the investment had a market value of $11.00 per share, or an aggregate value of $654,763. As of December 31, 2019, the Company obtained further observable evidence that the investment had a market value of $5.50 per share, or an aggregate value of $327,382 for a decrease in value of $327,381, which was reflected as a change in fair value of our equity investments in the condensed consolidated statements of operations. (C) In June 2017, the Company entered in a Subscription Agreement to purchase 0.5% interest in Precision Cultivation Systems, LLC (“Precision”), a Delaware limited liability company, for a purchase price of $50,000. Precision is developing a growth system that capitalizes on a patent-pending cultivation method that utilizes proprietary irrigation and root zone conditioning. As part of the Subscription Agreement, $42,500 of the investment is subject to repayment on a pro-rata basis with other investors who have entered into similar Subscription Agreements. Amounts subject to repayment are solely at the discretion of Precision. As a private company, Precision does not have a readily determinable fair value. Additionally, there have been no observable price changes from transactions for similar investments in Precision during the nine months ended December 31, 2019. As such, the Company has measured the value of the investment at cost as of December 31, 2019, which management believes approximates market value. (D) In January 2018, the Company paid $100,000 for the purchase of a Membership Interest in Bailey Venture Partners XII LLC (“Bailey”) representing less than 5% interest in Bailey. Along with other funds received from third-party investors, Bailey plans to invest funds received in various strategic investments. As a private company, Bailey does not have a readily determinable fair value. Additionally, there have been no observable price changes from transactions for similar investments in Bailey during the fiscal year ended March 31, 2019. As such, the Company has measured the value of the investment at cost as of December 31, 2019, which management believes approximates market value. As the Company does not participate in the management of these companies nor has the ability to exercise significant influence over these companies, the Company recorded these investments at cost and adjusts the cost basis to market at the end of each reporting period. Dividends, if any, are recognized when received. |
ACQUISITION OF TRACE ANALYTICS,
ACQUISITION OF TRACE ANALYTICS, INC. | 9 Months Ended |
Dec. 31, 2019 | |
ACQUISITION OF TRACE ANALYTICS, INC. | |
NOTE 5 - ACQUISITION OF TRACE ANALYTICS, INC | On January 7, 2019, the Company closed on a purchase of 520,410 shares of common stock of Trace Analytics, Inc., a Washington corporation (“Trace Analytics”). Pursuant to a Common Stock Purchase Agreement, the Company purchased Trace Analytics at a purchase price of $2.40 per share, for an aggregate purchase price of $1,250,000, of which 141,850 shares remain to be issued. Trace Analytics is a cannabis testing laboratory acquired to enable the Company to position itself as the leading provider of testing solutions for CBD products for both compliance requirements and consumer safety as these products continue to increase in popularity. Immediately following the purchase, the Company held 51% of the issued and outstanding shares of common stock of Trace Analytics and have included the financial results of Trace Analytics in the condensed consolidated financial statements from the date of acquisition, January 1, 2019. The Common Stock Purchase Agreement included the option for Trace to repurchase 205,410 shares of Common Stock based on the occurrence of certain Repurchase Triggering Events. Based on a review of the Repurchase Triggering Events, the Company considers it unlikely that any of the events will occur. Additionally, the Company entered into a Voting Agreement with Trace concurrent with the Common Stock Purchase Agreement. The Voting Agreement provided for the designation of three out of five positions on the Trace Analytics Board of Directors by the Company. The Voting Agreement also detailed certain transactions that require two-thirds approval by the Board of Directors. The Voting Agreement is not considered to impact the ability of the Company to control the operations and assets of Trace Analytics. The Company accounted for the transaction as a business combination in accordance with ASC 805 “Business Combinations” in which the Company recorded an initial goodwill amount of $1,941,149 as of March 31, 2019. The Company is in the process of performing an allocation of the purchase price paid for the assets acquired and the liabilities assumed. The fair values of the assets acquired as recognized at the date of the transaction on January 1, 2019 are considered provisional and subject to adjustment as additional information is obtained through the purchase price measurement period (a period of up to one year from the closing date). The provisional allocation of the purchase price is based on management’s preliminary estimates. Any prospective adjustments would change the fair value allocation as of the acquisition date. The Company is still in the process of reviewing underlying models, assumptions and discount rates used in the valuation of provisional goodwill. |
CONVERTIBLE NOTES PAYABLE
CONVERTIBLE NOTES PAYABLE | 9 Months Ended |
Dec. 31, 2019 | |
CONVERTIBLE NOTES PAYABLE | |
NOTE 6 - CONVERTIBLE NOTES PAYABLE | Convertible notes payable consisted of the following: December 31, 2019 March 31, 2019 Convertible notes $ 249,939 $ - 12% Senior Convertible Promissory Note 250,000 - Less: Debt Discount (153,170 ) - Total Convertible Notes, Net of Debt Discount $ 346,769 $ - Convertible Notes During the nine months ended December 31, 2019, the Company issued separate Convertible Promissory Notes (“Notes”) having a total principal amount of $349,939 to accredited holders at an interest rates ranging from 0% to 1% per month. The note holder, at their sole discretion and election, are allowed to convert any part or all of the then outstanding principal and/or interest on these Notes into shares of common stock of the Company at conversion prices ranging from $0.65 to $1.00 per share. As of December 31, 2019, $100,000 of the Notes were converted, into 153,846 shares of the Company’s common stock based on a conversion price of $0.65 per share. As such, balance of the notes at December 31, 2019 was $249,939. Certain of the Notes were issued when the market price of the Company’s common stock was in excess of conversion price per share creating a beneficial conversion feature associated with these Notes with an aggregate amount of $71,381 at issuance dates. As such, the Company recorded the $71,381 intrinsic value of the beneficial conversion feature at issuance dates of the Notes as additional paid-in capital and recognized as a debt discount. The debt discount is being amortized as interest expense over the terms of the related notes. During the nine month period ended December 31, 2019, the Company recorded amortization of the debt discount of $52,933 as interest expense. As such, unamortized debt discount as of December 31, 2019 related to these Notes was $18,449. 12% Senior Convertible Promissory Note On September 4, 2019, the Company entered into a Senior Convertible Promissory Note due September 12, 2020 (the “Note”) in the principal amount of $500,000, of which an initial tranche of $250,000 was received on September 9, 2019, to an accredited investor (the “Purchaser”). The maturity date for each tranche funded (each, a “Maturity Date”) under the Note shall be twelve (12) months from the effective date of the payment of the respective tranche, less any amounts converted or redeemed prior to the Maturity Date. As such, the initial tranche matures on September 8, 2020. The Note accrues interest at a rate of 12% per annum, payable on the Maturity Date or upon any conversion, prepayment, event of default or other acceleration of payment under the Note. All interest payments under the Note are payable, at the Company’s option, in cash or shares of Common Stock. All principal and interest due and owing under the Note is convertible into shares of Common Stock at any time at the election of the Purchaser at a conversion price per share equal to the lower of (i) $1.00 (the “Fixed Conversion Price”) or (ii) 70% multiplied by the average of the three (3) lowest closing prices of the Common Stock during the fifteen (15) consecutive trading-day period immediately preceding the date of the respective conversion (the “Alternate Conversion Price”) (the “Conversion Price”), which Conversion Price is subject to adjustment for (i) stock splits, stock dividends, combinations, or similar events and (ii) full ratchet anti-dilution protection. The Purchaser will have participation rights in subsequent rights offerings and pro rata distributions. However, the Purchaser does not have the right to convert the Note to the extent that such conversion would result in such Purchaser being the beneficial owner in excess of 4.99% (or, upon election of such Purchaser, 9.99%), which beneficial ownership limitation may be increased or decreased up to 9.99% upon notice to the Company, provided that any increase in such limitation will not be effective until 61 days following notice to the Company. In the event the Company has a DTC “Chill” on the Company’s shares, an additional discount of 10% shall apply to the Conversion Price while that “Chill” is in effect. The Alternate Conversion Price shall be subject to a floor price of $0.25 per share (the “Floor Price”) provided, however, that the Floor Price shall no longer apply (1) after August 1, 2020, (2) if certain events of default occurs under the Note, and/or (3) the Company fails to pay an amount in cash to the Purchaser equal to 125% multiplied by the respective conversion amount with respect to any notice of conversion as provided in the Note. The Company may prepay in cash any portion of the outstanding principal amount of the Note and any accrued and unpaid interest upon one (1) days’ written notice to the Purchaser, at any time prior to or as of (but not following) the earlier of the (i) the first conversion date under the Note for the respective tranche under the Note and (ii) the 180th calendar day after the funding date of the respective tranche under the Note. If the Company exercises its right to prepay any respective tranche under the Note at any time within the initial 180 calendar days following the funding date of the respective tranche under the Note, the Company will be required to pay a premium amount above the related principal amount ranging from 10% to 25% depending on when the prepayment notice is provided to the Purchaser. In connection with the offer and sale of the Note, the Company and the Purchaser entered into a Security Agreement, dated as of September 4, 2019 (the “Security Agreement”). Under the Security Agreement, the Company granted a security interest in all of their respective assets, rights, interests and after-acquired assets and properties, except for the Company’s ownership interest in its subsidiary, Trace Analytics, Inc., as collateral for repayment of the principal and interest owed under the Note. Also in connection with the offer and sale of the Note, the Company entered into a Registration Rights Agreement, dated September 4, 2019, with the Purchaser (the “Registration Rights Agreement”). Under the Registration Rights Agreement, the Company is obligated to register all shares of common stock underlying the Note resale in a registration statement to be filed with the Securities and Exchange Commission if the company files with the Securities and Exchange Commission a registration statement registering any securities, except a registration statement filed (i) in connection with any employee stock option or other benefit plan on Form S-8, (ii) for a dividend reinvestment plan or (iii) in connection with a merger or acquisition. The Company considered the FASB guidance of “Contracts in Entity’s Own Stock” which indicates that any adjustment to the fixed amount (either conversion price or number of shares) of the instrument regardless of the probability of whether or not within the issuers’ control means the instrument is not indexed to the issuer’s own stock. Accordingly, the Company determined that the conversion prices of the Notes was not a fixed amount because they were subject to an adjustment based on the occurrence of future offerings or events. As a result, the Company determined that the conversion features of the Note was not considered indexed to the Company’s own stock and characterized the fair value of the conversion features as derivative liabilities upon issuance. The Company determined that upon issuance of the Note, the initial fair value of the embedded conversion feature was $199,081. As such, the Company recorded a $199,081 derivative liability which was recorded as debt discount offsetting the fair value of the Note (see Note 7). During the nine months ended December 31, 2019, the Company amortized $64,360 of the debt discount to interest expense. The balance of the unamortized discount was $134,721 at December 31, 2019. |
DERIVATIVE LIABILITY
DERIVATIVE LIABILITY | 9 Months Ended |
Dec. 31, 2019 | |
DERIVATIVE LIABILITY | |
Note 7 - DERIVATIVE LIABILITY | In accordance with the FASB authoritative guidance, the conversion feature of the Note was separated from the host contract and recognized as a derivative instrument with a fair value of $199,081, which is re-measured at the end of every reporting period with the change in value reported in the condensed statement of operations. The initial derivative liability was valued using a weighted-average Black-Scholes-Merton model with the following assumptions: risk-free interest rate of 1.69%; expected volatility of 189%; expected life of 1 year; and expected dividend yield of 0%. The derivative liability was re-measured to be $234,058 as of December 31, 2019 using a weighted-average Black-Scholes-Merton model with the following assumptions: risk-free interest rate of 1.60%; expected volatility of 196%; expected life of .68 years; and expected dividend yield of 0%. This resulted in an increase in the initial value of the derivative of $34,977, which was recognized as other expense in the Company’s Condensed Statement of Operations for the nine months ended December 31, 2019. The Company used a risk-free interest rate based on rates established by the Federal Reserve Bank and used its own stock’s volatility as the estimated volatility. In addition, the expected life of the conversion feature of the notes was based on the remaining terms of the Note. Further, the expected dividend yield was based on the fact that the Company has not customarily paid dividends to its holders of Common Stock in the past and does not expect to pay dividends to holders of its Common Stock in the future. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Dec. 31, 2019 | |
RELATED PARTY TRANSACTIONS | |
NOTE 8 - RELATED PARTY TRANSACTIONS | During the period SBS Management LLC, a company controlled by Mr. Scott Stevens, who was appointed to the Company’s board of directors on April 15, 2019, made advances to the Company to cover certain operating expenses. These advances are unsecured, non-interest bearing, with no formal terms of repayment. As of December 31, 2019, the amounts due SBS were $96,300 and are included in accounts payable on the accompanying consolidated condensed balance sheets. During the nine months ended December 31, 2019, the Company paid SBS Management LLC $75,000 for management services. In addition, the Company reimbursed SBS Management LLC $35,000 for rent expense which amount has been included in general and administrative expense for the period. There were no such amounts invoiced during the nine months ended December 31, 2018. During the nine months ended December 31, 2019, the Company incurred $63,286 of which the Company paid $54,566 and $8,720 is included in accounts payable on the accompanying consolidated condensed balance sheets, from Emmess Group, Inc., a strategic advisory company, of which the Company’s President of Applied Biopharma LLC is the Executive Vice President and Managing Director of Emmess Group Inc. In addition, in October 2019 the Company issued 250,000 shares of the Company’s common stock to the President of Applied Biopharma at a price per share of $0.60 or $150,000, which was based on the fair market value of the Company’s common stock on date of issuance. On May 15, 2019, the Company’s Board of Directors approved the issuance of a convertible promissory note (the “Note”) in the principal amount of $250,000 to Greys Peak Ventures LLC, an investment firm whose partners include Scott Stevens and Chris Bridges, both directors of the Company. The Note was due December 31, 2019, holds a 0% interest rate, and is convertible at any time, in the sole discretion of the holder of the Note, into shares of common stock of the Company at a purchase price of $1.00 per share. As of December 31, 2019, the Company had borrowed $192,000 against the Note. A portion of the Notes were issued when the market price of the Company’s common stock was in excess of the $1.00 per share conversion price creating a beneficial conversion feature associated with these Notes with an aggregate amount of $6,000 at issuance dates. As such, the Company recorded the $6,000 intrinsic value of the beneficial conversion feature at issuance dates of the Notes as additional paid-in capital, and recognized as a debt discount, which was amortized as interest expense during the nine-month period ended December 31, 2019. |
EQUITY
EQUITY | 9 Months Ended |
Dec. 31, 2019 | |
EQUITY | |
NOTE 9 - EQUITY | Preferred Stock The Company has authorized 5,000,000 shares of $0.00001 par value, undesignated Preferred Stock. As of December 31, 2019, the Company has not issued any shares of Preferred Stock nor has the Company designated any class of Preferred Stock. Stock Option Plan On May 17, 2019, the board of directors of the Company approved and adopted the terms and provisions of a 2019 Stock Option Plan (the “Plan”) for the Company. No stockholder approval has been obtained approving the Plan. An aggregate of 2,000,000 shares of the Company’s common stock are initially reserved for issuance upon exercise of nonqualified and/or incentive stock options which may be granted under Plan. No options have yet been issued under the Plan. Shares Issued to Board Members and President In conjunction with the resignation of a board member in September 2019, the Company issued 100,000 shares to the former board member for past services rendered at a price of $0.70 per share for a total cost of $70,000, which represented the market price of the shares as of the date of issuance. In addition, in December 2019, the Company issued 300,000 shares of which 150,000 shares were issued to a board member of the company and 150,000 were issued to the President of CBD Products for past services at a price of $0.27 per share for a total cost of $81,000, which represented the market price of the shares as of the date of issuance. The value of these shares was reflected in general and administrative expenses is the Company’s condensed consolidated statements of operations. Shares Issued for Services During the nine months ended December 31, 2019, the Company issued 550,000 shares to four consultants for services rendered at a prices ranging from $0.51 to $0.60 per share for a total cost of $321,000, which represented the market price of the shares as of the date of relevant agreements. As of December 31, 2019, 450,000 of these shares have not been issued, and as such, the total fair value of these shares was reflected as “Common stock to be issued” in the accompanying condensed consolidated balance sheets as of December 31, 2019. The value of these shares was reflected in general and administrative expenses is the Company’s condensed consolidated statements of operations. Shares Issued for Debt During the nine months ended December 31, 2019, the Company issued 153,846 shares in conjunction with the conversion of a $100,000 convertible note. |
LEASE OBLIGATIONS
LEASE OBLIGATIONS | 9 Months Ended |
Dec. 31, 2019 | |
LEASE OBLIGATIONS | |
NOTE 10 - LEASE OBLIGATIONS | On October 1, 2019, the Company entered into a two-year extension related to 2,100 square feet of office space leased by its subsidiary, Applied Products LLC. The lease requires the Company to pay rent of $2,750 per month or $33,000 per year. The rent shall be increased at the end of each year by the same percentage as any increase in the Consumer Price Index (“CPI”) as published by the U.S. Department of Labor for the most recent preceding 12 month period. Also beginning on October 1, 2019, the Company entered into a five-year extension related to 3,734 square feet of office space leased by its subsidiary, Trace Analytics. The new rent is $5,716 per month or $68,592 per year. Effective April 1, 2019, the Company adopted the guidance of ASC 842, Leases, The components of rent expense and supplemental cash flow information related to leases for the period are as follows: Nine Months Ended December 31, 2019 Lease Cost Operating lease cost (included in general and administration in the Company’s unaudited condensed statement of operations) $ 25,398 Other Information Cash paid for amounts included in the measurement of lease liabilities $ - Weighted average remaining lease term – operating leases (in years) 4.3 Average discount rate – operating leases 4 % The supplemental balance sheet information related to leases for the period is as follows: At December 31, 2019 Operating leases Long-term right-of-use assets $ 350,752 Short-term operating lease liabilities $ 89,136 Long-term operating lease liabilities 261,616 Total operating lease liabilities $ 350,752 Maturities of the Company’s lease liabilities are as follows: Fiscal Year Ending March 31, Operating Leases 2020 (remaining 3 months) $ 25,398 2021 101,593 2022 85,092 2023 60,593 2024 68,593 2025 34,296 Total lease payments 383,565 Less: Imputed interest/present value discount (32,813 ) $ 350,752 Rent expense for the nine months ended December 31, 2019 and 2018 was $85,950 and $24,750, respectively. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Dec. 31, 2019 | |
SUBSEQUENT EVENTS | |
NOTE 11 - SUBSEQUENT EVENTS | In February 2020, the principal amount of debt owed to Greys Peak Ventures LLC of $192,000 was converted to 192,000 shares of the Company’s common stock. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Dec. 31, 2019 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | |
Principles of Consolidation | The condensed consolidated financial statements include the accounts of the Company and its subsidiaries, Applied Products LLC (100% owned entity), VitaCBD LLC, an 80% owned entity, Trace Analytics, Inc., a 51% owned entity, all Washington limited liability companies, and Applied Biopharma LLC and SHL Management LLC, both 100% owned Nevada limited liability companies. Intercompany transactions and balances have been eliminated in consolidation. Management evaluates its investments on an individual basis for purposes of determining whether or not consolidation is appropriate. |
Use of Estimates and Assumptions | Preparation of the condensed consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Among other things, management estimates include the collectability of its accounts receivable, recoverability of inventory, assumptions made in determining impairment of investments and intangible assets, accruals for potential liabilities, and realization of deferred tax assets. These estimates generally involve complex issues and require judgments, involve analysis of historical information and the prediction of future trends, and are subject to change from period to period. Actual amounts could differ significantly from these estimates. |
Revenue Recognition | The Company’s revenue is principally derived from its subsidiaries, Applied Products LLC, and Trace Analytics. · Applied Products LLC revenues are generated from sales of high-quality CBD products for consumer and pet health and wellness. Sales of these products are made to individual distributors and through online sales. Revenue from the sale of these products was $192,011 and $472,509 during the nine months ended December 31, 2019 and 2018, respectively · Trace Analytics generates revenue from services by offering state-of-the-art testing and analytics capabilities to CBD and hemp companies. Sales of these services are to marijuana producers and processors, dispensaries, and CBD and hemp companies. Revenue from the sale of these services was $433,295 during the nine months ended December 31, 2019. The Company recognizes revenue in accordance with Financial Accounting Standards Board’s (“FASB”) Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers |
Advertising | The Company expenses advertising costs as incurred. Advertising expense for the nine month periods ended December 31, 2019 and 2018 amounted to $37,144 and $40,769, respectively, and were included in “Sales and marketing expenses” in the Consolidated Statements of Operations. |
Earnings (Loss) per Share | The basic earnings (loss) per share is calculated by dividing the Company’s net income (loss) available to common shareholders by the weighted average number of common shares during the period. Shares of common stock to be issued are included in weighted average shares calculation from the date of grant. The diluted earnings (loss) per share is calculated by dividing the Company’s net income (loss) available to common shareholders by the diluted weighted average number of shares outstanding during the period. The diluted weighted average number of shares outstanding is the basic weighted average number of shares adjusted for any potentially dilutive debt or equity. Diluted earnings (loss) per share are the same as basic earnings (loss) per share due to the lack of dilutive items. |
Investments | The Company follows ASU 2016-01, Financial Instruments – Overall: Recognition and Measurement of Financial Assets and Financial Liabilities. ASU 2016-01 primarily affects equity investments, financial liabilities under the fair value option, and the presentation and disclosure requirements for financial instruments. Among other things, this guidance requires certain equity investments to be measured at fair value with changes in fair value recognized in net income. As such, the Company measures its equity investments at their fair value at end of each reporting period. Investments accounted for under the equity method or cost method of accounting above are included in the caption “Equity investments” on the Condensed Consolidated Balance Sheets. |
Goodwill | Goodwill represents the excess of the purchase consideration over the fair value of the net tangible and identifiable intangible assets acquired in a business combination. The Company evaluates goodwill for impairment on an annual basis or whenever events and changes in circumstances suggest that the carrying amount may not be recoverable. The Company conducts its annual impairment analysis in the fourth quarter of each fiscal year. Impairment of goodwill is tested at the reporting unit level by comparing the reporting unit’s carrying amount, including goodwill, to the fair value of the reporting unit. Estimations and assumptions regarding the number of reporting units, future performances, results of the Company’s operations and comparability of its market capitalization and net book value will be used. If the carrying amount of the reporting unit exceeds its fair value, goodwill is considered impaired and an impairment loss is measured by the resulting amount. Because the Company has one reporting unit, as part of the Company’s qualitative assessment an entity-wide approach to assess goodwill for impairment is utilized. Based on management’s assessment, no impairment losses have been recorded in the nine month periods ended December 31, 2019. |
Stock Based Compensation | The Company issues stock options and warrants, shares of common stock, and equity interests as share-based compensation to employees and non-employees. The Company accounts for its share-based compensation to employees in accordance with FASB ASC 718, Compensation – Stock Compensation. Stock-based compensation cost is measured at the grant date, based on the estimated fair value of the award, and is recognized as expense over the requisite service period. In prior periods up to March 31, 2019, the Company accounted for share-based compensation issued to non-employees and consultants in accordance with the provisions of FASB ASC 505-50, Equity - Based Payments to Non-Employees. Measurement of share-based payment transactions with non-employees is based on the fair value of whichever is more reliably measurable: (a) the goods or services received; or (b) the equity instruments issued. The final fair value of the share-based payment transaction is determined at the performance completion date. For interim periods, the fair value is estimated, and the percentage of completion is applied to that estimate to determine the cumulative expense recorded. In June 2018, the FASB issued ASU No. 2018-07, Compensation - Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. The guidance was issued to simplify the accounting for share-based transactions by expanding the scope of Topic 718 from only being applicable to share-based payments to employees to also include share-based payment transactions for acquiring goods and services from nonemployees. As a result, nonemployee share-based transactions will be measured by estimating the fair value of the equity instruments at the grant date, taking into consideration the probability of satisfying performance conditions. The Company adopted ASU 2018-07 on April 1, 2019. The adoption of the standard did not have a material impact on our financial statements for the three and nine months periods ended December 31, 2019 or the previously reported financial statements. |
Derivative Financial Instruments | The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the condensed consolidated statements of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within 12 months of the balance sheet date. To determine the number of authorized but unissued shares available to satisfy outstanding convertible securities, the Company uses a sequencing method to prioritize its convertible securities as prescribed by ASC 815-40-35. At each reporting date, the Company reviews its convertible securities to determine their classification is appropriate. |
Leases | Prior to April 1, 2019, the Company accounted for leases under ASC 840, Accounting for Leases Leases, |
Segments | The Company operates in one segment for the distribution of products and services. In accordance with the “Segment Reporting” Topic of the ASC, the Company’s chief operating decision maker has been identified as the Chief Executive Officer, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. Existing guidance, which is based on a management approach to segment reporting, establishes requirements to report selected segment information quarterly and to report annually entity-wide disclosures about products and services, major customers, and the countries in which the entity holds material assets and reports revenue. All material operating units qualify for aggregation under “Segment Reporting” due to their similar customer base and similarities in: economic characteristics; nature of products and services; and procurement, manufacturing and distribution processes. Since the Company operates in one segment, all financial information required by “Segment Reporting” can be found in the accompanying condensed consolidated financial statements. |
Recent Accounting Pronouncements | In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments (Topic 326), which replaces the incurred-loss impairment methodology and requires immediate recognition of estimated credit losses expected to occur for most financial assets, including trade receivables. Credit losses on available-for-sale debt securities with unrealized losses will be recognized as allowances for credit losses limited to the amount by which fair value is below amortized cost. ASU 2016-13 is effective for the Company beginning January 1, 2020 and early adoption is permitted. The Company does not believe the potential impact of the new guidance and related codification improvements will be material to its financial position, results of operations and cash flows. Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future consolidated financial statements. |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 9 Months Ended |
Dec. 31, 2019 | |
PROPERTY AND EQUIPMENT (Tables) | |
Schedule of property and equipment | December 31, 2019 March 31, 2019 Lab Equipment $ 569,484 $ 569,484 Office Furniture and Equipment 57,562 57,562 Leasehold Improvements 21,557 21,557 648,603 648,603 Less: Accumulated Depreciation (317,280 ) (196,555 ) $ 331,323 $ 452,048 |
EQUITY INVESTMENTS (Tables)
EQUITY INVESTMENTS (Tables) | 9 Months Ended |
Dec. 31, 2019 | |
EQUITY INVESTMENTS (Tables) | |
Schedule of Equity investments | December 31, 2019 March 31, 2019 (A) GemmaCert $ 93,529 $ 93,529 (B) Hightimes Holdings Corp. 327,382 654,763 (C) Precision Cultivation Systems, LLC 50,000 50,000 (D) Bailey Venture Partners XII LLC 100,000 100,000 $ 570,911 $ 898,292 |
CONVERTIBLE NOTES PAYABLE (Tabl
CONVERTIBLE NOTES PAYABLE (Tables) | 9 Months Ended |
Dec. 31, 2019 | |
CONVERTIBLE NOTES PAYABLE (Tables) | |
CONVERTIBLE NOTES PAYABLE | December 31, 2019 March 31, 2019 Convertible notes $ 249,939 $ - 12% Senior Convertible Promissory Note 250,000 - Less: Debt Discount (153,170 ) - Total Convertible Notes, Net of Debt Discount $ 346,769 $ - |
LEASE OBLIGATIONS (Tables)
LEASE OBLIGATIONS (Tables) | 9 Months Ended |
Dec. 31, 2019 | |
LEASE OBLIGATIONS (Tables) | |
Schedule of cash flow supplemental | Nine Months Ended December 31, 2019 Lease Cost Operating lease cost (included in general and administration in the Company’s unaudited condensed statement of operations) $ 25,398 Other Information Cash paid for amounts included in the measurement of lease liabilities $ - Weighted average remaining lease term – operating leases (in years) 4.3 Average discount rate – operating leases 4 % |
Schedule of balance sheet information related to leases | At December 31, 2019 Operating leases Long-term right-of-use assets $ 350,752 Short-term operating lease liabilities $ 89,136 Long-term operating lease liabilities 261,616 Total operating lease liabilities $ 350,752 |
Schedule of maturities of lease liabilities | Fiscal Year Ending March 31, Operating Leases 2020 (remaining 3 months) $ 25,398 2021 101,593 2022 85,092 2023 60,593 2024 68,593 2025 34,296 Total lease payments 383,565 Less: Imputed interest/present value discount (32,813 ) $ 350,752 |
NATURE OF OPERATIONS AND BASI_2
NATURE OF OPERATIONS AND BASIS OF PRESENTATION (Details Narrative) - USD ($) | Jan. 07, 2019 | Jan. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 |
State of incorporation | Nevada | |||||
Date of incorporation | Feb. 21, 2014 | |||||
Net loss | $ (1,425,870) | $ (1,891,543) | $ (2,789,028) | $ (2,407,059) | ||
Net cash used in operating activities | (817,715) | $ (788,863) | ||||
Private Placements [Member] | Accredited Investors [Member] | ||||||
Proceeds from issuance of convertible notes | $ 791,939 | |||||
Trace Analytics [Member] | ||||||
Common stock purchase agreement, description | The Company closed on a purchase of 520,410 shares of common stock of Trace Analytics, Inc., a Washington corporation (“Trace Analytics”), for an aggregate purchase price of $1,250,000, of which $750,000 was paid in cash and $500,000 was paid in shares of common stock of the Company. Trace Analytics is a cannabis testing laboratory. Immediately following the purchase, the Company held 51% of the issued and outstanding shares of common stock | |||||
Issuance of common stock for cash, shares | 520,410 | 520,410 | ||||
Aggregate purchase price of common stock | $ 1,250,000 | $ 1,250,000 | ||||
Purchase price of common stock paid in cash | $ 750,000 | |||||
Purchase price of common stock paid in shares | 500,000 | |||||
Owned interest entity | 51.00% |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Oct. 01, 2019 | Mar. 31, 2019 | |
Advertising expenses | $ 37,144 | $ 40,769 | ||||
Revenue | $ 169,575 | $ 413,109 | 625,306 | 472,509 | ||
Operating lease right-of-use assets, net | $ 350,752 | $ 350,752 | ||||
Leases [Member] | ||||||
Operating lease right-of-use assets, net | $ 372,490 | |||||
Applied Products LLC [Member] | ||||||
Owned interest entity | 100.00% | |||||
Revenue | $ 192,011 | 472,509 | ||||
Trace Analytics [Member] | ||||||
Owned interest entity | 51.00% | |||||
Revenue | $ 433,295 | |||||
Applied Biopharma LLC [Member] | SHL Management LLC [Member] | ||||||
Owned interest entity | 100.00% | |||||
VitaCBD LLC [Member] | ||||||
Owned interest entity | 80.00% |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) | Dec. 31, 2019 | Mar. 31, 2019 |
Property and equipment | $ 648,603 | $ 648,603 |
Less: Accumulated Depreciation | (317,280) | (196,555) |
Property and equipment | 331,323 | 452,048 |
Lab Equipment [Member] | ||
Property and equipment | 569,484 | 569,484 |
Office Furniture and Equipment [Member] | ||
Property and equipment | 57,562 | 57,562 |
Leasehold Improvements [Member] | ||
Property and equipment | $ 21,557 | $ 21,557 |
EQUITY INVESTMENTS (Details)
EQUITY INVESTMENTS (Details) - USD ($) | Dec. 31, 2019 | Mar. 31, 2019 |
Equity investments | $ 570,911 | $ 898,292 |
Precision Cultivation Systems, LLC [Member] | ||
Equity investments | 50,000 | 50,000 |
GemmaCert [Member] | ||
Equity investments | 93,529 | 93,529 |
Hightimes Holdings Corp. [Member] | ||
Equity investments | 327,382 | 654,763 |
Bailey Venture Partners XII LLC [Member] | ||
Equity investments | $ 100,000 | $ 100,000 |
EQUITY INVESTMENTS (Details Nar
EQUITY INVESTMENTS (Details Narrative) - USD ($) | 1 Months Ended | 6 Months Ended | 9 Months Ended | ||||
Jan. 31, 2018 | Oct. 31, 2017 | Jan. 31, 2017 | Nov. 30, 2016 | Mar. 31, 2019 | Dec. 31, 2019 | Jun. 30, 2017 | |
Equity investments | $ 898,292 | $ 570,911 | |||||
Precision Cultivation Systems, LLC [Member] | |||||||
Purchase of stock | 50,000 | ||||||
Equity investments | $ 50,000 | $ 50,000 | |||||
Repayment of investment, pro-rata basis | $ 42,500 | ||||||
Series A preferred stock [Member] | |||||||
Purchase of stock | 7,309 | 29,571 | |||||
Stock price per share | $ 2.536 | $ 1.69086 | $ 2.536 | $ 2.536 | |||
Total investment | $ 18,537 | $ 50,000 | $ 93,529 | $ 93,529 | |||
Common stock A [Member] | |||||||
Purchase of stock | 59,524 | ||||||
Stock price per share | $ 4.20 | ||||||
Total investment | $ 250,000 | ||||||
GemmaCert [Member] | |||||||
Equity investments | 93,529 | $ 93,529 | |||||
Stock price per share | $ 2.536 | ||||||
Hightimes Holdings Corp. [Member] | |||||||
Ownership percentages description | Which accounts for less than 5% investment in Hightimes Holdings Corp. | ||||||
Equity investments | $ 654,763 | $ 327,382 | |||||
Equity investments decrease value | $ 327,381 | ||||||
Market value per share | $ 11 | $ 5.50 | |||||
Bailey Venture Partners XII LLC [Member] | |||||||
Ownership percentages description | Representing less than 5% interest in Bailey. | ||||||
Purchase of stock | 100,000 | ||||||
Equity investments | $ 100,000 | $ 100,000 |
ACQUISITION OF TRACE ANALYTICS
ACQUISITION OF TRACE ANALYTICS INC (Details Narrative) - USD ($) | Jan. 07, 2019 | Jan. 31, 2019 | Dec. 31, 2019 | Mar. 31, 2019 |
Goodwill (provisional) | $ 1,941,149 | $ 1,941,149 | ||
Trace Analytics [Member] | ||||
Common stock purchase agreement, description | The Company closed on a purchase of 520,410 shares of common stock of Trace Analytics, Inc., a Washington corporation (“Trace Analytics”), for an aggregate purchase price of $1,250,000, of which $750,000 was paid in cash and $500,000 was paid in shares of common stock of the Company. Trace Analytics is a cannabis testing laboratory. Immediately following the purchase, the Company held 51% of the issued and outstanding shares of common stock | |||
Issuance of common stock for cash, shares | 520,410 | 520,410 | ||
Aggregate purchase price of common stock | $ 1,250,000 | $ 1,250,000 | ||
Shares to be issued | 141,850 | |||
Owned interest entity | 51.00% | |||
Purchase price per share | $ 2.40 | |||
Common stock repurchased, Shares | 205,410 |
CONVERTIBLE NOTES PAYABLE (Deta
CONVERTIBLE NOTES PAYABLE (Details) - USD ($) | Dec. 31, 2019 | Mar. 31, 2019 |
CONVERTIBLE NOTES PAYABLE (Details) | ||
Convertible notes | $ 249,939 | |
12% Senior Convertible Promissory Note | 250,000 | |
Less: Debt Discount | (153,170) | |
Total Convertible Notes, Net of Debt Discount | $ 346,769 |
CONVERTIBLE NOTES PAYABLE (De_2
CONVERTIBLE NOTES PAYABLE (Details Narrative) - USD ($) | Sep. 04, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Sep. 09, 2019 | Mar. 31, 2019 |
Amortization of debt discount | $ 52,933 | ||||
Unamortized debt discount | 18,449 | ||||
Debt discount | 71,381 | ||||
Fair value of beneficial conversion feature related to issuance of convertible notes | 77,381 | $ 437,805 | |||
Fair value of conversion feature recorded as a derivative liability | 199,081 | ||||
Convertible notes | 249,939 | ||||
Senior Convertible Promissory Note [Member] | |||||
Principal amount | $ 500,000 | ||||
Fair value of embedded conversion feature | 199,081 | ||||
Unamortized discount | 134,721 | ||||
Amortized of debt discount | 64,360 | ||||
Fair value of conversion feature recorded as a derivative liability | 199,081 | ||||
Percentage of payment failure in cash to the purchaser | 125.00% | ||||
Accrued interest | 12.00% | ||||
Debt instrument | $ 250,000 | ||||
Debt instrument description | The maturity date for each tranche funded (each, a “Maturity Date”) under the Note shall be twelve (12) months from the effective date of the payment of the respective tranche, less any amounts converted or redeemed prior to the Maturity Date. As such, the initial tranche matures on September 8, 2020. | ||||
Conversion price description | Conversion price per share equal to the lower of (i) $1.00 (the “Fixed Conversion Price”) or (ii) 70% multiplied by the average of the three (3) lowest closing prices of the Common Stock during the fifteen (15) consecutive trading-day period. | ||||
Excess percentage of beneficial owner | 4.99% | ||||
Ownership percentage | 9.99% | ||||
Additional discount on conversion price | 10.00% | ||||
Alternate conversion price | $ 0.25 | ||||
Convertible Promissory Notes [Member] | |||||
Principal amount | 349,939 | ||||
Common Stock issued upon conversion of convertible note | $ 100,000 | ||||
Common stock issued upon conversion of shares | 153,846 | ||||
Conversion price | $ 0.65 | ||||
Maximum [Member] | Senior Convertible Promissory Note [Member] | |||||
Percentage of premium amount to be paid | 25.00% | ||||
Maximum [Member] | Convertible Promissory Notes [Member] | |||||
Conversion price | $ 1 | ||||
Interest rate | 1.00% | ||||
Minimum [Member] | Senior Convertible Promissory Note [Member] | |||||
Percentage of premium amount to be paid | 10.00% | ||||
Minimum [Member] | Convertible Promissory Notes [Member] | |||||
Conversion price | $ 0.65 | ||||
Interest rate | 0.00% |
DERIVATIVE LIABILITY (Details N
DERIVATIVE LIABILITY (Details Narrative) - USD ($) | 9 Months Ended | |
Dec. 31, 2019 | Mar. 31, 2019 | |
Fair value of conversion feature recorded as a derivative liability | $ 199,081 | |
Derivative liability | 234,058 | |
Increase decrease in derivative liabilities | $ 34,977 | |
Risk-free interest rate | 1.69% | |
Expected volatility | 189.00% | |
Expected term | 1 year | |
Expected dividend yield | 0.00% | |
Black-Scholes-Merton model [Member] | ||
Risk-free interest rate | 1.60% | |
Expected volatility | 196.00% | |
Expected term | 8 months 5 days | |
Expected dividend yield | 0.00% |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | May 15, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Oct. 31, 2019 | Mar. 31, 2019 |
Accounts payable related party | $ 659,682 | $ 278,546 | |||
Fair value of beneficial conversion feature related to issuance of convertible notes | $ 77,381 | $ 437,805 | |||
Common stock shares issued | 14,100,956 | 13,397,110 | |||
SBS Management LLC [Member] | |||||
Accounts payable related party | $ 96,300 | ||||
Reimbursed amount for Rent expense | 35,000 | ||||
Management services | 75,000 | ||||
Emmess Group Inc. [Member] | |||||
Accounts payable related party | 63,286 | ||||
Common stock shares issued | 250,000 | ||||
Common stock shares price per share | $ 0.60 | ||||
Fair market value of common stock | $ 150,000 | ||||
Convertible Notes Payable [Member] | |||||
Conversion price per share | $ 1 | ||||
Common stock purchase price | $ 1 | ||||
Interest rate | 0.00% | ||||
Fair value of beneficial conversion feature related to issuance of convertible notes | $ 6,000 | ||||
Intrinsic value of beneficial conversion feature | 6,000 | ||||
Principal amount | 250,000 | ||||
Borrowings against note | 192,000 | ||||
Transaction Two [Member] | |||||
Accounts payable related party | 8,720 | ||||
Transaction One [Member] | |||||
Payment to related party | $ 54,566 |
EQUITY (Details Narrative)
EQUITY (Details Narrative) | 1 Months Ended | 9 Months Ended | |
May 17, 2019shares | Dec. 31, 2019USD ($)integer$ / sharesshares | Mar. 31, 2019USD ($)$ / sharesshares | |
Preferred stock, shares par value | $ / shares | $ 0.00001 | $ 0.00001 | |
Common stock to be issued | 450,000 | ||
Debt conversion converted instrument, Shares issued | 153,846 | ||
Preferred stock, shares authorized | 5,000,000 | 5,000,000 | |
Debt conversion converted instrument, Amount | $ | $ 100,000 | ||
Common stock, shares issued | 14,100,956 | 13,397,110 | |
Common stock value | $ | $ 143 | $ 135 | |
Stock Option Plan [Member] | |||
Aggregate shares of common stock are reserved | 2,000,000 | ||
Former Board [Member] | September 2019 [Member] | |||
Price Per share | $ / shares | $ 0.70 | ||
Common stock, shares issued | 100,000 | ||
Common stock value | $ | $ 70,000 | ||
Board Members and President [Member] | |||
Common Stock issued for services, Shares | 300,000 | ||
Common Stock issued for services, Value | $ | $ 81,000 | ||
Board Member [Member] | |||
Common Stock issued for services, Shares | 150,000 | ||
Price Per share | $ / shares | $ 0.27 | ||
President [Member] | |||
Common Stock issued for services, Shares | 150,000 | ||
Price Per share | $ / shares | $ 0.27 | ||
Four Consultants [Member] | |||
Common Stock issued for services, Shares | 550,000 | ||
Common Stock issued for services, Value | $ | $ 321,000 | ||
Number of consultants | integer | 4 | ||
Four Consultants [Member] | Maximum [Member] | |||
Price Per share | $ / shares | $ 0.60 | ||
Four Consultants [Member] | Minimum [Member] | |||
Price Per share | $ / shares | $ 0.51 |
LEASE OBLIGATIONS (Details)
LEASE OBLIGATIONS (Details) | 9 Months Ended |
Dec. 31, 2019USD ($) | |
LEASE OBLIGATIONS (Details) | |
Operating lease cost (included in general and administration in the Company's unaudited condensed statement of operations) | $ 25,398 |
Other Information | |
Cash paid for amounts included in the measurement of lease liabilities | |
Weighted average remaining lease term - operating leases (in years) | 4 years 3 months 19 days |
Average discount rate - operating leases | 4.00% |
LEASE OBLIGATIONS (Details 1)
LEASE OBLIGATIONS (Details 1) - USD ($) | Dec. 31, 2019 | Mar. 31, 2019 |
Operating leases | ||
Long-term right-of-use assets | $ 350,752 | |
Short-term operating lease liabilities | 89,136 | |
Long-term operating lease liabilities | 261,616 | |
Total operating lease liabilities | $ 350,752 |
LEASE OBLIGATIONS (Details 2)
LEASE OBLIGATIONS (Details 2) | Dec. 31, 2019USD ($) |
Fiscal Year Ending March 31 | |
2020 (remaining 3 months) | $ 25,398 |
2021 | 101,593 |
2022 | 85,092 |
2023 | 60,593 |
2024 | 68,593 |
2025 | 34,296 |
Total lease payments | 383,565 |
Less:Imputed interest/present value discount | (32,813) |
Operating Lease payments, net | $ 350,752 |
LEASE OBLIGATIONS (Details Narr
LEASE OBLIGATIONS (Details Narrative) | 9 Months Ended | ||
Dec. 31, 2019USD ($)ft² | Dec. 31, 2018USD ($) | Mar. 31, 2019USD ($) | |
Rent expense | $ 85,950 | $ 24,750 | |
Long-term right-of-use assets | 350,752 | ||
Trace Analytics [Member] | |||
Lease rent per year | 68,592 | ||
Payment for lease monthly rent | $ 5,716 | ||
Trace Analytics [Member] | Lease Extenstions [Member] | |||
Office space | ft² | 3,734 | ||
Lease extenstion period | 5 years | ||
Applied Products LLC [Member] | On October 1, 2019 [Member] | Lease Extenstions [Member] | |||
Lease rent per year | $ 33,000 | ||
Payment for lease monthly rent | $ 2,750 | ||
Term of lease | 12 months | ||
Office space | ft² | 2,100 | ||
Long-term right-of-use assets | $ 372,490 | ||
Lease extenstion period | 2 years |
SUBSEQUENT EVENT (Details Narra
SUBSEQUENT EVENT (Details Narrative) - USD ($) | 1 Months Ended | 9 Months Ended |
May 17, 2019 | Dec. 31, 2019 | |
Debt conversion, converted instrument, Shares issued | 153,846 | |
Debt conversion, converted instrument, Amount | $ 100,000 | |
Subsequent Event [Member] | Greys Peak Ventures LLC [Member] | In February 2020 [Member] | ||
Debt conversion, converted instrument, Shares issued | 192,000 | |
Debt conversion, converted instrument, Amount | $ 192,000 |