Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2021 | Nov. 15, 2021 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2021 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2021 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 001-40578 | |
Entity Registrant Name | AGRIFORCE GROWING SYSTEMS LTD. | |
Entity Central Index Key | 0001826397 | |
Entity Incorporation, State or Country Code | A1 | |
Entity Address, Address Line One | 300 – 2233 Columbia Street | |
Entity Address, City or Town | Vancouver | |
Entity Address, State or Province | BC | |
Entity Address, Country | CA | |
Entity Address, Postal Zip Code | V5Y 0M6 | |
City Area Code | 604 | |
Local Phone Number | 757-0952 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Elected Not To Use the Extended Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 15,057,859 | |
Common Shares [Member] | ||
Title of 12(b) Security | Common Shares | |
Trading Symbol | AGRI | |
Security Exchange Name | NASDAQ | |
Series A Warrants [Member] | ||
Title of 12(b) Security | Series A Warrants | |
Trading Symbol | AGRIW | |
Security Exchange Name | NASDAQ |
Condensed Consolidated Interim
Condensed Consolidated Interim Balance Sheets (Unaudited) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 | |
Current | |||
Cash and cash equivalents | $ 9,834,516 | $ 653,410 | |
Other receivables | 31,547 | 8,973 | |
Prepaid expenses and other current assets (Note 3) | 479,870 | 213,038 | |
Total current assets | 10,345,933 | 875,421 | |
Non-current | |||
Property and equipment, net | 38,499 | 28,443 | |
Intangible asset (Note 4) | 1,469,933 | ||
Deferred IPO costs | 390,932 | ||
Construction in progress | 2,069,630 | 2,071,093 | |
Total assets | 13,923,995 | 3,365,889 | |
Current | |||
Accounts payable and accrued liabilities (Note 5) | 1,080,469 | 1,930,988 | |
Contingent consideration payable | 750,000 | ||
Total current liabilities | 1,830,469 | 1,930,988 | |
Non-current | |||
Warrants liability (Note 8) | 1,842,895 | ||
Long term loan (Note 7) | 47,092 | 31,417 | |
Total liabilities | 3,720,456 | 1,962,405 | |
Commitments and contingencies (Note 10) | |||
Shareholders’ equity | |||
Preferred Shares, no par value per share - unlimited shares authorized; nil and 2,258,826 shares issued and outstanding at September 30, 2021 and December 31, 2020, respectively | [1] | 6,717,873 | |
Common shares, no par value per share - unlimited shares authorized; 15,057,859 and 8,441,617 shares issued and outstanding at September 30, 2021 and December 31, 2020, respectively | [1] | 25,462,183 | 5,696,050 |
Additional paid-in-capital | 1,913,608 | 1,297,566 | |
Obligation to issue shares | 102,345 | 94,885 | |
Accumulated deficit | (17,173,083) | (12,521,944) | |
Accumulated other comprehensive income | (101,514) | 119,054 | |
Total shareholders’ equity | 10,203,539 | 1,403,484 | |
Total liabilities and shareholders’ equity | $ 13,923,995 | $ 3,365,889 | |
[1] | reflects the 1:4.75 |
Condensed Consolidated Interi_2
Condensed Consolidated Interim Balance Sheets (Unaudited) (Parenthetical) - $ / shares | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0 | $ 0 |
Preferred stock shares, authorized unlimited | Unlimited | Unlimited |
Preferred stock, shares outstanding | 2,258,826 | |
Preferred stock, shares issued | 2,258,826 | |
Common stock, par value | $ 0 | $ 0 |
Common stock shares, authorized unlimited | Unlimited | Unlimited |
Common stock,shares outstanding | 15,057,859 | 8,441,617 |
Common stock, shares issued | 15,057,859 | 8,441,617 |
Condensed Consolidated Interi_3
Condensed Consolidated Interim Statements of Comprehensive Loss (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | ||
OPERATING EXPENSES | |||||
Consulting | $ 129,364 | $ 54,415 | $ 620,960 | $ 362,760 | |
Depreciation | 2,283 | 2,285 | 7,606 | 6,697 | |
Office and administrative | 327,257 | 80,506 | 439,532 | 147,295 | |
Investor and public relations | 390,579 | 55,975 | 555,665 | 152,488 | |
Professional fees | 140,653 | 144,508 | 393,904 | 353,586 | |
Rent | 65,187 | 167 | 72,473 | 20,703 | |
Research and development | 116,857 | 921 | 178,117 | 114,352 | |
Share-based compensation | 415,597 | 217,291 | 571,398 | 463,882 | |
Shareholder and regulatory | 114,002 | 284,423 | 117,347 | 377,256 | |
Travel and entertainment | 28,545 | 46 | 39,851 | 5,723 | |
Wages and salaries | 650,456 | 140,419 | 989,421 | 580,309 | |
Operating loss | (2,380,780) | (980,956) | (3,986,274) | (2,585,051) | |
OTHER EXPENSES | |||||
Foreign exchange (gain) loss | (170,140) | (7,629) | (170,664) | 2,011 | |
Accretion of interest on senior secured debentures | 57,019 | 484,379 | |||
Change in fair value of warrants | (818,960) | (818,960) | |||
Issuance cost related to warrants | 375,123 | 375,123 | |||
Loss on extension of debt term | (204) | 59,055 | |||
Loss before provision for income taxes | (1,823,618) | (973,327) | (3,915,207) | (2,587,062) | |
Provision for income taxes | |||||
Net loss | (1,823,618) | (973,327) | (3,915,207) | (2,587,062) | |
Dividend paid to preferred shareholders | 203,674 | 735,932 | 459,236 | ||
Net loss attributable to common shareholders | (2,027,292) | (973,327) | (4,651,139) | (3,046,298) | |
Other comprehensive income (loss) | |||||
Foreign currency translation | (228,317) | 34,612 | (220,568) | (113,982) | |
Comprehensive loss attributable to common shareholders | $ (2,255,609) | $ (938,715) | $ (4,871,707) | $ (3,160,280) | |
Basic and diluted net loss attributed to common share | [1] | $ (0.14) | $ (0.12) | $ (0.46) | $ (0.39) |
Weighted average number of common shares outstanding – basic and diluted* | 14,378,354 | 7,936,767 | 10,144,800 | 7,821,064 | |
[1] | reflects the 1:4.75 |
Condensed Consolidated Interi_4
Condensed Consolidated Interim Statements of Comprehensive Loss (Unaudited) (Parenthetical) | Nov. 29, 2020 |
Equity [Abstract] | |
Reverse stock split, description | 1:4.75 |
Condensed Consolidated Interi_5
Condensed Consolidated Interim Statements of Changes in Shareholders' Equity (Unaudited) - USD ($) | Common Stock [Member] | Preferred Stock [Member] | Additional Paid-in Capital [Member] | Obligation to Issue Shares [Member] | Retained Earnings [Member] | AOCI Attributable to Parent [Member] | Total | |||
Beginning balance, value at Dec. 31, 2019 | $ 3,725,454 | [1] | $ 6,717,873 | [1] | $ 726,356 | $ 12,463 | $ (8,352,354) | $ 164,910 | $ 2,994,702 | |
Balance, shares at Dec. 31, 2019 | [1] | 7,705,209 | 2,258,826 | |||||||
Shares issued for consulting services | $ 324,868 | [1] | 94,058 | 418,926 | ||||||
Shares issued for consulting services, shares | [1] | 96,029 | ||||||||
Shares issued for dividend on Preferred Shares | $ 459,236 | [1] | (459,236) | |||||||
Shares issued for dividend on Preferred Shares, shares | [1] | 135,530 | ||||||||
Share based compensation | 463,882 | 463,882 | ||||||||
Net loss | (2,587,062) | (2,587,062) | ||||||||
Foreign currency translation | (113,982) | (113,982) | ||||||||
Ending balance, value at Sep. 30, 2020 | $ 4,509,558 | [1] | $ 6,717,873 | [1] | 1,190,238 | 106,521 | (11,398,652) | 50,928 | 1,176,466 | |
Balance,shares at Sep. 30, 2020 | [1] | 7,936,768 | 2,258,826 | |||||||
Beginning balance, value at Jun. 30, 2020 | $ 4,509,558 | [1] | $ 6,717,873 | [1] | 972,947 | (10,425,325) | 16,316 | 1,791,369 | ||
Balance, shares at Jun. 30, 2020 | [1] | 7,936,768 | 2,258,826 | |||||||
Shares issued for consulting services | 106,521 | 106,521 | ||||||||
Share based compensation | 217,291 | 217,291 | ||||||||
Net loss | (973,327) | (973,327) | ||||||||
Foreign currency translation | 34,612 | 34,612 | ||||||||
Ending balance, value at Sep. 30, 2020 | $ 4,509,558 | [1] | $ 6,717,873 | [1] | 1,190,238 | 106,521 | (11,398,652) | 50,928 | 1,176,466 | |
Balance,shares at Sep. 30, 2020 | [1] | 7,936,768 | 2,258,826 | |||||||
Beginning balance, value at Dec. 31, 2020 | $ 5,696,050 | [1] | $ 6,717,873 | [1] | 1,297,566 | 94,885 | (12,521,944) | 119,054 | 1,403,484 | |
Balance, shares at Dec. 31, 2020 | [1] | 8,441,617 | 2,258,826 | |||||||
Shares issued for cash | $ 13,262,712 | 13,262,712 | ||||||||
Shares issued for cash, shares | [1] | 3,127,998 | ||||||||
Shares issued for Conversion of series A preferred stock | $ 6,717,873 | [1] | ||||||||
Shares issued for Conversion of series A preferred stock, shares | [1] | 2,258,826 | (2,258,826) | |||||||
Shares issued on exercise of warrants | $ 238,800 | [1] | 44,644 | 283,444 | ||||||
Shares issued on exercise of warrants, shares | [1] | 39,800 | ||||||||
Shares issued on cashless exercise of options | ||||||||||
Shares issued on cashless exercise of options,shares | [1] | 820,029 | ||||||||
Shares issued for bonus | $ 514,066 | [1] | 514,066 | |||||||
Shares issued for bonus, shares | [1] | 98,356 | ||||||||
Shares issued for consulting services | $ 349,809 | [1] | 7,460 | 357,269 | ||||||
Shares issued for consulting services, shares | [1] | 62,237 | ||||||||
Share issued for settlement of accrued director’s fee | $ 46,783 | [1] | 46,783 | |||||||
Share issued for settlement of accrued director's fee, shares | [1] | 19,992 | ||||||||
Shares issued for dividend on Preferred Shares | $ 735,932 | [1] | (735,932) | |||||||
Shares issued for dividend on Preferred Shares, shares | [1] | 189,004 | ||||||||
Share issue costs | (2,099,842) | |||||||||
Share based compensation | 571,398 | 571,398 | ||||||||
Net loss | (3,915,207) | (3,915,207) | ||||||||
Foreign currency translation | (220,568) | (220,568) | ||||||||
Ending balance, value at Sep. 30, 2021 | $ 25,462,183 | [1] | 1,913,608 | 102,345 | (17,173,083) | (101,514) | 10,203,539 | |||
Balance,shares at Sep. 30, 2021 | [1] | 15,057,859 | ||||||||
Beginning balance, value at Jun. 30, 2021 | $ 7,022,883 | [1] | $ 6,717,873 | [1] | 1,453,367 | 94,885 | (15,145,791) | 126,803 | 270,020 | |
Balance, shares at Jun. 30, 2021 | [1] | 9,542,769 | 2,258,826 | |||||||
Shares issued for cash | $ 13,262,712 | [1] | 13,262,712 | |||||||
Shares issued for cash, shares | [1] | 3,127,998 | ||||||||
Shares issued for Conversion of series A preferred stock | $ 6,717,873 | [1] | ||||||||
Shares issued for Conversion of series A preferred stock, shares | [1] | 2,258,826 | (2,258,826) | |||||||
Shares issued on exercise of warrants | $ 238,800 | [1] | 44,644 | 283,444 | ||||||
Shares issued on exercise of warrants, shares | [1] | 39,800 | ||||||||
Shares issued for consulting services | $ 69,300 | [1] | 7,460 | 76,760 | ||||||
Shares issued for consulting services, shares | [1] | 15,000 | ||||||||
Share issued for settlement of accrued director’s fee | $ 46,783 | [1] | 46,783 | |||||||
Share issued for settlement of accrued director's fee, shares | [1] | 19,992 | ||||||||
Shares issued for dividend on Preferred Shares | $ 203,674 | [1] | (203,674) | |||||||
Shares issued for dividend on Preferred Shares, shares | [1] | 53,474 | ||||||||
Share issue costs | $ (2,099,842) | (2,099,842) | ||||||||
Share based compensation | 415,597 | 415,597 | ||||||||
Net loss | (1,823,618) | (1,823,618) | ||||||||
Foreign currency translation | (228,317) | (228,317) | ||||||||
Ending balance, value at Sep. 30, 2021 | $ 25,462,183 | [1] | $ 1,913,608 | $ 102,345 | $ (17,173,083) | $ (101,514) | $ 10,203,539 | |||
Balance,shares at Sep. 30, 2021 | [1] | 15,057,859 | ||||||||
[1] | reflects the 1:4.75 |
Condensed Consolidated Interi_6
Condensed Consolidated Interim Statements of Changes in Shareholders' Equity (Unaudited) (Parenthetical) | Nov. 29, 2020 |
Statement of Stockholders' Equity [Abstract] | |
Reverse stock split, description | 1:4.75 |
Condensed Consolidated Interi_7
Condensed Consolidated Interim Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net loss for the period | $ (3,915,207) | $ (2,587,062) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation | 7,606 | 6,697 |
Share-based compensation | 571,398 | 463,882 |
Shares issued for consulting services | 298,214 | 418,926 |
Loss on extension of debt term | 59,055 | |
Issuance cost related to warrants | 375,123 | |
Change in fair value of warrants | (818,960) | |
Accretion of interest on senior secured debentures | 484,379 | |
Changes in operating assets and liabilities: | ||
Other receivables | (22,574) | 40,942 |
Prepaid expenses and other current assets | (266,832) | (59,288) |
Accounts payable and accrued liabilities | 210,330 | 82,129 |
Net cash used in operating activities | (3,017,468) | (1,633,774) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Acquisition of equipment | (17,866) | (851) |
Acquisition of intangibles | (225,000) | |
Cash paid for construction in progress | (744,191) | |
Net cash used in investing activities | (987,057) | (851) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from Initial Public Offering | 15,639,990 | |
IPO costs paid including underwriting discount | (2,279,374) | (41,200) |
Proceeds from exercise warrants | 238,800 | |
Proceeds from long-term loan | 15,932 | 29,987 |
Proceeds from issuance of senior secured debentures | 600,000 | |
Financing costs of senior secured debentures | (69,000) | |
Repayment of Senior Secured Debentures | (750,000) | |
Net cash provided by financing activities | 13,396,348 | (11,213) |
Effect of exchange rate changes on cash and cash equivalent | (210,717) | (59,533) |
Change in cash | 9,181,106 | (1,705,371) |
Cash, beginning of period | 653,410 | 2,158,891 |
Cash, end of period | 9,834,516 | 453,520 |
Supplemental cash flow information: | ||
Cash paid during the period for interest | ||
Cash paid during the period for income taxes | ||
Supplemental disclosure of non-cash investing and financing transactions | ||
Fair Value of warrants liability | 374,028 | |
Preferred stock dividend paid in common shares | 735,932 | 459,236 |
Unpaid amount related to construction in progress included in accounts payable | 744,191 | |
Conversion of Series A preferred stock to common shares | 6,717,873 | |
Unpaid IPO costs | 84,569 | |
Unpaid amount related to intangible assets included in accrued expenses | $ 500,000 |
NATURE OF OPERATIONS AND BASIS
NATURE OF OPERATIONS AND BASIS OF PREPARATION | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF OPERATIONS AND BASIS OF PREPARATION | 1. NATURE OF OPERATIONS AND BASIS OF PREPARATION Business Overview AgriFORCE Growing Systems Ltd. (the “Company”) is an innovative agriculture-focused technology company that delivers reliable, financially robust solutions for high value crops through our proprietary facility design and automation Intellectual Property to businesses and enterprises globally. The Company intends to operate in the plant based pharmaceutical, nutraceutical, and other high value crop markets using its unique proprietary facility design and hydroponics based automated growing system that enable cultivators to effectively grow crops in a controlled environment. The Company calls its facility design and automated growing system the “AgriFORCE grow house.” The Company has designed its AgriFORCE grow house to produce in virtually any environmental condition and to optimize crop yields to as near their full genetic potential possible whilst substantially eliminating the need for the use of pesticides and/or irradiation Basis of Presentation The accompanying Condensed Consolidated Interim Financial Statements (the “interim financial statements”) and related financial information of AgriFORCE Growing Systems Ltd. (the “Company”) should be read in conjunction with the audited financial statements and the related notes thereto for the years ended December 31, 2020 and 2019 included in the Company’s Registration Statement on Form S-1/A (File No. 333-251380), which was filed with the Securities Exchange Commission (“SEC”) on June 30, 2021. These unaudited interim financial statements have been prepared in accordance with the rules and regulations of the United States Securities and SEC for interim financial information. Accordingly, they do not include all of the information and footnotes required by the accounting principles generally accepted in the United States of America (“U.S. GAAP”) for complete financial statements. The accompanying interim financial statements as of September 30, 2021 and for the three and nine months ended September 30, 2021 and 2020, and the related interim information contained within the notes to the interim financial statements, are unaudited. The interim financial statements have been prepared in accordance with U.S. GAAP and on the same basis as the audited financial statements. In the opinion of management, the accompanying interim condensed financial statements contain all adjustments which are necessary to state fairly the Company’s financial position as of September 30, 2021, and the results of its operations and cash flows for the nine months ended September 30, 2021 and 2020. Such adjustments are of a normal and recurring nature. The results for the nine months ended September 30, 2021 are not necessarily indicative of the results to be expected for the full fiscal year ending December 31, 2021, or for any future period. Liquidity and Management’s Plan In accordance with Accounting Standards Update No. 2014-15, Presentation of Financial Statements – Going Concern (Subtopic 205-40) As of September 30, 2021, the Company had cash and cash equivalent of $ 9,834,516 1,823,618 3,915,207 3,017,468 17,173,083 Although it is difficult to predict the Company’s liquidity requirements, as of September 30, 2021, and based upon the Company’s current operating plan and the net proceeds received from its July 2021 initial public offering (“IPO”) (see Note 9), the Company believes that it will have sufficient cash to meet its projected operating requirements for at least the next 12 months following the issuance of the interim financial statements based on the balance of cash. |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | 2. SIGNIFICANT ACCOUNTING POLICIES Recent Accounting Pronouncements Effective January 1, 2021, the Company adopted ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes.” ASU 2019-12 simplifies the accounting for income taxes by removing exceptions within the general principles of Topic 740 regarding the calculation of deferred tax liabilities, the incremental approach for intra-period tax allocation, and calculating income taxes in an interim period. In addition, the ASU adds clarifications to the accounting for franchise tax (or similar tax). which is partially based on income, evaluating tax basis of goodwill recognized from a business combination, and reflecting the effect of any enacted changes in tax laws or rates in the annual effective tax rate computation in the interim period that includes the enactment date. The adoption of this new guidance did not have a material impact to these interim financial statements. In August 2020, the FASB issued ASU 2020-06 “Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity” (“ASU 2020-06”). The intention of ASU 2020-06 is to address the complexities in accounting for certain financial instruments with a debt and equity component. Under ASU 2020-06, the number of accounting models for convertible notes will be reduced and entities that issue convertible debt will be required to use the if-converted method for the computation of diluted “Earnings per share” under ASC 260. ASC 2020-06 is effective for fiscal years beginning after December 15, 2021 and may be adopted through either a modified retrospective method of transition or a fully retrospective method of transition. The Company is currently assessing the impact this guidance will have on our condensed consolidated financial statements. In May 2021, the FASB issued ASU 2021-04 - Earnings Per Share (Topic 260), Debt - Modifications and Extinguishments (Subtopic 470-50), Compensation - Stock Compensation (Topic 718), and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options (a consensus of the FASB Emerging Issues Task Force). ASU 2021-04 clarifies and reduces diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options that remain equity classified after modification or exchange. Modifications and exchanges should be treated as an exchange of the original instrument for a new instrument. The amendment requires entities to measure the effect as the difference between the fair value of the modified or exchanged written call option and the fair value of that written call option immediately before it is modified or exchanged if the modification or the exchange that is a part of or directly related to a modification or an exchange of an existing debt instrument or line-of-credit or revolving-debt arrangements. For all other modifications or exchanges, the effect should be measured as the excess, if any, of the fair value of the modified or exchanged written call option over the fair value of that written call option immediately before it is modified or exchanged for all other modifications or exchanges. The amendments require entities to recognize the effect on the basis of the substance of the transaction, in the same manner as if cash had been paid as consideration. The amendments also require entities to recognize the effect in accordance with the guidance in Topic 718, Compensation - Stock Compensation. ASU No. 2021-04 is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. ASU 2021-04 will be adopted on January 1, 2022. The Company is currently assessing the impact this guidance will have on our condensed consolidated financial statements. Other accounting standards that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption. The Company does not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to its financial condition, results of operations, cash flows or disclosures. Loss per Common Share The Company presents basic and diluted loss per share data for its common shares. Basic loss per common share is calculated by dividing the profit or loss attributable to common shareholders of the Company by the weighted average number of common shares outstanding during the year. Diluted loss per common share is calculated by adjusting the weighted average number of common shares outstanding to assume conversion of all potentially dilutive share equivalents, such as stock options and warrants and assumes the receipt of proceeds upon exercise of the dilutive securities to determine the number of shares assumed to be purchased at the average market price during the year. Diluted net loss attributable to common shareholders per share does not differ from basic net loss attributable to common shareholders per share for the three and nine months ended September 30, 2021 and September 30, 2020, since the effect of the Company’s stock options and warrants are anti-dilutive. Fair Value of Financial Instruments The fair value of the Company’s accounts receivable, accounts payable and other current liabilities approximate their carrying amounts due to the relative short maturities of these items. As part of the issuance of debentures on March 24, 2021, the Company issued warrants having strike price denominated in U.S. Dollars. This creates an obligation to issue shares for a price that is not denominated in the Company’s functional currency and renders the warrants not indexed to the Company’s stock, and therefore, must be classified as a derivative liability and measured at fair value. On the same basis, the Series A Warrants and the representative warrants issued as part of the IPO are also classified as a derivative liability and measured at fair value. The fair value of the Company’s warrants is determined in accordance with FASB ASC 820, “Fair Value Measurement,” which establishes a fair value hierarchy that prioritizes the assumptions (inputs) to valuation techniques used to price assets or liabilities that are measured at fair value. The hierarchy, as defined below, gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The guidance for fair value measurements requires that assets and liabilities measured at fair value be classified and disclosed in one of the following categories: ● Level 1: Defined as observable inputs, such as quoted (unadjusted) prices in active markets for identical assets or liabilities. ● Level 2: Defined as observable inputs other than quoted prices included in Level 1. This includes quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. ● Level 3: Defined as unobservable inputs to the valuation methodology that are supported by little or no market activity and that are significant to the measurement of the fair value of the assets or liabilities. Level 3 assets and liabilities include those whose fair value measurements are determined using pricing models, discounted cash flow methodologies or similar valuation techniques, as well as significant management judgment or estimation. As of September 30, 2021, the Company’s warrant liability related to IPO warrants and representative’s warrant amounting to $ 1,771,481 71,414 Reclassifications The Company has reclassified certain amounts in the 2020 consolidated financial statements to comply with the 2021 presentation. |
PREPAID EXPENSES AND OTHER CURR
PREPAID EXPENSES AND OTHER CURRENT ASSETS | 9 Months Ended |
Sep. 30, 2021 | |
Prepaid Expenses And Other Current Assets | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | 3. PREPAID EXPENSES AND OTHER CURRENT ASSETS SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS September 30, 2021 December 31, 2020 Deposits $ 170,000 $ 170,000 Legal retainer 70,295 43,038 Prepaid insurance 139,473 - Others – office lease deposit 100,102 - Total $ 479,870 $ 213,038 During the year ended December 31, 2020, the Company entered into a land purchase agreement in relation to construction of a facility in Coachella, California. A deposit of $ 170,000 4.4 |
INTANGIBLE ASSET
INTANGIBLE ASSET | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSET | 4. INTANGIBLE ASSET Intangible asset represents Intellectual Property (“IP”) acquired under an Asset purchase agreement from Manna Nutritional Group, LLC (“MNG”) on September 10, 2021. The IP encompasses patent-pending technologies to naturally process and convert grain, pulses and root vegetables, resulting in low-starch, low-sugar, high-protein, fiber-rich baking flour products, as well as a wide range of breakfast cereals, juices, natural sweeteners and baking enhancers. The terms of the agreement are as below: The aggregate purchase price for the Purchased Assets (the “Purchase Price”) is up to $ 14,475,000 (i) The number of shares of Company’s common stock (rounded up to the nearest whole number), restricted as to resale under Section 4(a)(2) of the Securities Act, equal to the quotient of (i) $5,000,000 divided by (ii) a per share price equal to the average of the volume weighted average price (“VWAP”) of the Company’s common shares for the ten trading days immediately preceding the Due Diligence Deadline (as defined below) (the “Closing Shares”). The Closing Shares, to be due on the Closing Date, which Closing Shares are restricted as to resale and issued under a private placement exempt from registration under Section 4(a) (2) of the Securities Act, are subject to release of restriction and lockup on a quarterly basis over ten quarters commencing on the Closing Date in equal amounts of shares over ten consecutive calendar quarters. ● Receipt and Tasting of Flours and Sweeteners by the Company; ● Independent Lab Testing of Flours and Sweeteners by the Company to confirm fiber, protein, and starch content of such products meets the specifications provided by MNG; and ● Completion by the Company of Third-Party Engineering Process Analysis, included in the scope of work outlined by Covert Engineers, dated August 11, 2021, for conceptual and preliminary plant design for a Pilot Manufacturing Facility. (ii) $ 1,475,000 (iii) $725,000 in cash payable follows: (a) $225,000 payable on the Effective Date; and (b) $500,000 payable within 120 days after the Effective Date, to reimburse MNG for, without limitation, satisfaction of all the secured debt as listed in Section 2.04 of the Disclosure Schedules to the Agreement (the “Secured Debt”) (iv) The number of shares of Company’s common stock (rounded up to the nearest whole number) to be issued in two tranches that equals (i) $8,000,000 divided by (ii) a per share price equal to the VWAP of the Company’s common shares for the ten trading days immediately before the issuance date of those shares (“Post Closing Shares”). $5,000,000 of the Post-Closing Shares will be issued on June 30, 2022, to be held in Escrow. $3,000,000 of the Post-Closing Shares will be issued to MNG on December 31, 2022, to be held in Escrow. In the event that after 24 months from the closing date, a Patent does not issue from the IP, Buyer’s obligation to issue the Post-Closing Shares and Dividends to MNG will be deemed null and void ab initio and will no longer be due and owing to MNG, and the Post-Closing Shares shall be released from escrow and returned to the Company, and the Purchase Price shall be adjusted downward dollar for dollar. Based on the terms above and in conformity with US GAAP, the Company accounted for purchase as an asset acquisition and has deemed the asset purchased as an in-process research and development. The Company has further deemed the asset to be of indefinite life until the completion of the associated research and development (“R&D”) activities. Once completed and commercialized, the asset will be amortized over its useful life. The recognition of the IP asset is based on the payments made to date of $ 225,000 and contingent consideration that is probable and reasonably estimable as of the reporting date. Subsequent changes in contingent consideration are recorded against cost. As of September 30, 2021, the company has recorded $ 500,000 under accrued expenses, related to reimbursement for satisfaction of secured debt of seller. Further, the company has recorded $ 750,000 as contingent consideration, which is considered probable and due on closing. The remaining amounts payable as described above were not deemed to be probable at September 30, 2021, and accordingly have not been accrued for. |
ACCOUNTS PAYABLE AND ACCRUED LI
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES | 9 Months Ended |
Sep. 30, 2021 | |
Payables and Accruals [Abstract] | |
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES | 5. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED LIABILITIES September 30, 2021 December 31, 2020 Accounts payable $ 197,187 $ 991,565 Accrued expenses 813,861 905,629 Others 69,421 33,794 Accounts Payable and Accrued Liabilities $ 1,080,469 $ 1,930,988 Accounts payable includes $nil (December 31, 2020 - $ 744,191 487,983 500,000 29,817 128,448 297,437 |
SENIOR SECURED DEBENTURES
SENIOR SECURED DEBENTURES | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
SENIOR SECURED DEBENTURES | 6. SENIOR SECURED DEBENTURES On March 24, 2021, the Company entered into a securities purchase agreement with certain accredited investors for the purchase of $ 750,000 600,000 June 24, 2021 69,000 On June 24, 2021, the due date was extended, for which the Company paid an extension fee of 10,000 60,000 July 13, 2021 As part of the bridge loan, the debenture holder was issued warrants (the “Bridge Warrants”) to purchase 93,938 3.99 three The changes in the fair value of the Bridge Warrants amounting to $ 199,255 71,414 2.23 75 0.67 3 |
LONG TERM LOAN
LONG TERM LOAN | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
LONG TERM LOAN | 7. LONG TERM LOAN During the year ended December 31, 2020, the Company entered into a loan agreement with Alterna Bank for a principal amount of $ 31,417 40,000 The Program, as set out by the Government of Canada, requires that the funds from this loan shall only be used by the Company to pay non-deferrable operating expenses including, without limitation, payroll, rent, utilities, insurance, property tax and regularly scheduled debt service, and may not be used to fund any payments or expenses such as prepayment/refinancing of existing indebtedness, payments of dividends, distributions and increases in management compensation. The loan is interest free for an initial term that ends on December 31, 2022 25 10,000 5 the extended term i.e. January 31, 2023 to December 31, 2025 In April 2021, the Company applied for additional loan with Alterna Bank under the Program and received $ 15,932 20,000 |
WARRANT LIABILITY
WARRANT LIABILITY | 9 Months Ended |
Sep. 30, 2021 | |
Warrant Liability | |
WARRANT LIABILITY | 8. WARRANT LIABILITY As of September 30, 2021, the warrant liability represents aggregate fair value of publicly traded 3,088,198 135,999 93,938 The representative’s warrant is exercisable one year from the effective date of the registration statement for the IPO and will expire three years after the effective date. The exercise price of the representative’s warrant is $ 6 The change in fair value on the warrant liability amounting to $ 818,960 |
SHARE CAPITAL
SHARE CAPITAL | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
SHARE CAPITAL | 9. SHARE CAPITAL On March 29, 2021, the Company issued 30,000 179,700 On May 10, 2021, the Company declared, and on May 11, 2021 issued, 86,739 On May 10, 2021, the Company declared, and on May 11, 2021 issued, 48,791 On May 27, 2021, the Company issued to consultants a total of 7,237 On May 27, 2021, the Company issued 820,029 1,113,701 On May 28, 2021, the Company’s officers opted to receive a total of 98,356 On May 31, 2021, the Company granted a total of 405,059 three five 7.00 1.48 6.00 80 0.98 3 On July 15, 2021 the Company granted a total of 55,445 three five 7.00 85,693 3.86 80 0.88 3 On September 30, 2021 the Company granted a total of 49,284 three five 7.00 32,530 2.30 80 1.11 3 As of September 30, 2021, there was $ 901,575 3 On June 24, 2021, the Company issued to a consultant working with the senior secured debentures holders, a total of 10,000 On July 12, 2021, the Company completed its IPO whereby it sold a total of 3,127,998 5.00 15,639,990 14,388,791 1,251,199 Concurrent with the closing of the IPO, the 2,258,826 On July 13, 2021, the Company declared and issued, 53,474 On July 13, 2021, the Company issued to consultants a total of 15,000 On July 15, 2021, the Company issued 39,800 39,800 6 On July 28, 2021, 93,938 three years 3.99 On Sep 01, 2021, the Company issued to Directors 19,992 common shares as settlement of accrued directors’ fee. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 10. COMMITMENTS AND CONTINGENCIES Lease commitments The Company entered into an operating lease for office space. The minimum future payments under the lease for our continuing operations in each of the years ending December 31 is as SCHEDULE OF FUTURE PAYMENTS UNDER LEASE Remainder of 2021 $ 68,137 2022 $ 273,962 2023 $ 279,610 2024 $ 289,495 2025 $ 306,442 2026 $ 306,442 Subsequent years $ 842,714 Total $ 2,366,802 Litigation During the nine months ended September 30, 2021 and the year ended December 31, 2020, the Company had no new contingencies to disclose. During the year ended December 31, 2018, the Company entered into a purchase agreement with certain parties representing proprietary technology. As consideration for the purchase of the technology and attendant intellectual property rights, the Company issued an aggregate of 5,263,158 25,000,000 An additional 105,263 500,000 Subsequent to the execution of these agreements, the Company was notified as to certain issues relating to the transaction agreements that were executed and the intellectual property risks that were purportedly transferred. After several months of analysis with various professionals, the Company determined that the technology was in fact invalid and therefore without any value. On May 15, 2019, a claim by HydroHaus Horticulture, Inc., Stuart Brazier and Christopher Gielnik was filed in BC Supreme Court. The basic allegations against Agriforce Growing Systems Ltd. are: 1. The Company breached the manufacturing agreement under which HydroHaus Horticulture claims it had the exclusive right to build hydro houses for the Company; 2. The Company advised HydroHaus Horticulture that it was in breach of the licensing agreement relating to its project to build a hydro house for the Nak’azdli causing HydroHaus Horticulture to spend approximately $ 130,000 3. The Company owes approximately $ 100,000 4. The Company wrongfully rescinded its agreements with HydroHaus Horticulture. The plaintiffs are seeking general and special damages, alternatively rescission of the agreements or specific performance of those agreements and payment for expenses incurred by HydroHaus Horticulture for the benefit of the Company. The plaintiffs are also seeking an order that the Hydrohaus IP (allegedly comprising certain cladding materials and methods of insulating greenhouses, regulating humidity, moving growing plants, and managing the movement of air, and any derivative works), and an associated patent application, be transferred to them. The Plaintiffs are also seeking an order prohibiting the Company from using the words, “Canivate”, “the Canivate Way”, “HydroFilm”, “Hydrohouse” and “Hydrohaus”. On May 24, 2019, the Company filed a Response to the claim. That response denies the allegations in the claim, raises the defense that the plaintiffs wrongfully purported to sell intellectual property which they falsely stated they had invented and owned and states that the intellectual property was unworkable to build greenhouses. The Company also alleges that the plaintiffs falsely represented that their work for the Kak’adzdli would benefit the Company when it would not. The Response asks that the claim be dismissed. The Company has also filed a Counterclaim based upon its allegations that the plaintiffs wrongfully induced the Company to enter agreements with the plaintiffs based on fraudulent misrepresentations regarding the existence of ownership of intellectual property. Further, the counterclaim alleges that Mr. Brazier breached his fiduciary duties to Canivate in preferring the interests of Hydrohaus over those of the Company. The counterclaim seeks a declaration that the agreements which the Company rescinded were properly rescinded based upon the misrepresentations of the plaintiffs as well as general, special, aggravated and punitive damages, an accounting for profits, and legal costs. During the nine months ended September 30, 2021 and the year ended December 31, 2020, there has been no further activity in the lawsuit. Based on Company’s litigation counsel’s opinion, management does not believe the potential monetary damages to be material based on the damages sought by the plaintiff. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2021 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 11. SUBSEQUENT EVENTS Management has evaluated subsequent events pursuant to the requirements of ASC Topic 855, from the balance sheet date through the date the financial statements were issued and has determined that no material subsequent events exist, except for events previously disclosed in the notes to the financial statements, and the negotiation of the terms of debt financing related to purchase of land as disclosed in Note 3. |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Effective January 1, 2021, the Company adopted ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes.” ASU 2019-12 simplifies the accounting for income taxes by removing exceptions within the general principles of Topic 740 regarding the calculation of deferred tax liabilities, the incremental approach for intra-period tax allocation, and calculating income taxes in an interim period. In addition, the ASU adds clarifications to the accounting for franchise tax (or similar tax). which is partially based on income, evaluating tax basis of goodwill recognized from a business combination, and reflecting the effect of any enacted changes in tax laws or rates in the annual effective tax rate computation in the interim period that includes the enactment date. The adoption of this new guidance did not have a material impact to these interim financial statements. In August 2020, the FASB issued ASU 2020-06 “Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity” (“ASU 2020-06”). The intention of ASU 2020-06 is to address the complexities in accounting for certain financial instruments with a debt and equity component. Under ASU 2020-06, the number of accounting models for convertible notes will be reduced and entities that issue convertible debt will be required to use the if-converted method for the computation of diluted “Earnings per share” under ASC 260. ASC 2020-06 is effective for fiscal years beginning after December 15, 2021 and may be adopted through either a modified retrospective method of transition or a fully retrospective method of transition. The Company is currently assessing the impact this guidance will have on our condensed consolidated financial statements. In May 2021, the FASB issued ASU 2021-04 - Earnings Per Share (Topic 260), Debt - Modifications and Extinguishments (Subtopic 470-50), Compensation - Stock Compensation (Topic 718), and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options (a consensus of the FASB Emerging Issues Task Force). ASU 2021-04 clarifies and reduces diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options that remain equity classified after modification or exchange. Modifications and exchanges should be treated as an exchange of the original instrument for a new instrument. The amendment requires entities to measure the effect as the difference between the fair value of the modified or exchanged written call option and the fair value of that written call option immediately before it is modified or exchanged if the modification or the exchange that is a part of or directly related to a modification or an exchange of an existing debt instrument or line-of-credit or revolving-debt arrangements. For all other modifications or exchanges, the effect should be measured as the excess, if any, of the fair value of the modified or exchanged written call option over the fair value of that written call option immediately before it is modified or exchanged for all other modifications or exchanges. The amendments require entities to recognize the effect on the basis of the substance of the transaction, in the same manner as if cash had been paid as consideration. The amendments also require entities to recognize the effect in accordance with the guidance in Topic 718, Compensation - Stock Compensation. ASU No. 2021-04 is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. ASU 2021-04 will be adopted on January 1, 2022. The Company is currently assessing the impact this guidance will have on our condensed consolidated financial statements. Other accounting standards that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption. The Company does not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to its financial condition, results of operations, cash flows or disclosures. |
Loss per Common Share | Loss per Common Share The Company presents basic and diluted loss per share data for its common shares. Basic loss per common share is calculated by dividing the profit or loss attributable to common shareholders of the Company by the weighted average number of common shares outstanding during the year. Diluted loss per common share is calculated by adjusting the weighted average number of common shares outstanding to assume conversion of all potentially dilutive share equivalents, such as stock options and warrants and assumes the receipt of proceeds upon exercise of the dilutive securities to determine the number of shares assumed to be purchased at the average market price during the year. Diluted net loss attributable to common shareholders per share does not differ from basic net loss attributable to common shareholders per share for the three and nine months ended September 30, 2021 and September 30, 2020, since the effect of the Company’s stock options and warrants are anti-dilutive. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The fair value of the Company’s accounts receivable, accounts payable and other current liabilities approximate their carrying amounts due to the relative short maturities of these items. As part of the issuance of debentures on March 24, 2021, the Company issued warrants having strike price denominated in U.S. Dollars. This creates an obligation to issue shares for a price that is not denominated in the Company’s functional currency and renders the warrants not indexed to the Company’s stock, and therefore, must be classified as a derivative liability and measured at fair value. On the same basis, the Series A Warrants and the representative warrants issued as part of the IPO are also classified as a derivative liability and measured at fair value. The fair value of the Company’s warrants is determined in accordance with FASB ASC 820, “Fair Value Measurement,” which establishes a fair value hierarchy that prioritizes the assumptions (inputs) to valuation techniques used to price assets or liabilities that are measured at fair value. The hierarchy, as defined below, gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The guidance for fair value measurements requires that assets and liabilities measured at fair value be classified and disclosed in one of the following categories: ● Level 1: Defined as observable inputs, such as quoted (unadjusted) prices in active markets for identical assets or liabilities. ● Level 2: Defined as observable inputs other than quoted prices included in Level 1. This includes quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. ● Level 3: Defined as unobservable inputs to the valuation methodology that are supported by little or no market activity and that are significant to the measurement of the fair value of the assets or liabilities. Level 3 assets and liabilities include those whose fair value measurements are determined using pricing models, discounted cash flow methodologies or similar valuation techniques, as well as significant management judgment or estimation. As of September 30, 2021, the Company’s warrant liability related to IPO warrants and representative’s warrant amounting to $ 1,771,481 71,414 |
Reclassifications | Reclassifications The Company has reclassified certain amounts in the 2020 consolidated financial statements to comply with the 2021 presentation. |
PREPAID EXPENSES AND OTHER CU_2
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Prepaid Expenses And Other Current Assets | |
SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS | SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS September 30, 2021 December 31, 2020 Deposits $ 170,000 $ 170,000 Legal retainer 70,295 43,038 Prepaid insurance 139,473 - Others – office lease deposit 100,102 - Total $ 479,870 $ 213,038 |
ACCOUNTS PAYABLE AND ACCRUED _2
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Payables and Accruals [Abstract] | |
SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED LIABILITIES | SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED LIABILITIES September 30, 2021 December 31, 2020 Accounts payable $ 197,187 $ 991,565 Accrued expenses 813,861 905,629 Others 69,421 33,794 Accounts Payable and Accrued Liabilities $ 1,080,469 $ 1,930,988 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
SCHEDULE OF FUTURE PAYMENTS UNDER LEASE | SCHEDULE OF FUTURE PAYMENTS UNDER LEASE Remainder of 2021 $ 68,137 2022 $ 273,962 2023 $ 279,610 2024 $ 289,495 2025 $ 306,442 2026 $ 306,442 Subsequent years $ 842,714 Total $ 2,366,802 |
NATURE OF OPERATIONS AND BASI_2
NATURE OF OPERATIONS AND BASIS OF PREPARATION (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2021 | Jun. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||
Cash | $ 9,834,516 | |||||
Net Income (Loss) Attributable to Parent | $ (1,823,618) | 1,823,618 | $ (973,327) | $ (3,915,207) | $ (2,587,062) | |
Net Income (Loss) Attributable to Parent | 1,823,618 | $ (1,823,618) | $ 973,327 | 3,915,207 | 2,587,062 | |
Net Cash Provided by (Used in) Operating Activities | 3,017,468 | $ 1,633,774 | ||||
Retained Earnings (Accumulated Deficit) | $ 17,173,083 | $ 17,173,083 | $ 12,521,944 |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) | Sep. 30, 2021USD ($) |
IPO Warrant [Member] | |
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | |
Warrant liability | $ 1,771,481 |
Bridge Warrant [Member] | |
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | |
Warrant liability | $ 71,414 |
SCHEDULE OF PREPAID EXPENSES AN
SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Prepaid Expenses And Other Current Assets | ||
Deposits | $ 170,000 | $ 170,000 |
Legal retainer | 70,295 | 43,038 |
Prepaid insurance | 139,473 | |
Others – office lease deposit | 100,102 | |
Total | $ 479,870 | $ 213,038 |
PREPAID EXPENSES AND OTHER CU_3
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details Narrative) - USD ($) | Apr. 06, 2021 | Sep. 30, 2021 | Dec. 31, 2020 |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Deposit Assets | $ 170,000 | $ 170,000 | |
Land Purchase Agreement [Member] | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Deposit Assets | $ 170,000 | ||
Payments to Acquire Land | $ 4,400,000 |
INTANGIBLE ASSET (Details Narra
INTANGIBLE ASSET (Details Narrative) - USD ($) | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Finite-Lived Intangible Assets [Line Items] | |||
Purchase price of purchased asset | $ 225,000 | ||
Accrued Liabilities, Current | 500,000 | $ 487,983 | |
Contingent consideration payable | 750,000 | ||
Asset Purchase Agreement [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Purchase price of purchased asset | $ 1,475,000 | ||
Agreement description | The number of shares of Company’s common stock (rounded up to the nearest whole number), restricted as to resale under Section 4(a)(2) of the Securities Act, equal to the quotient of (i) $5,000,000 divided by (ii) a per share price equal to the average of the volume weighted average price (“VWAP”) of the Company’s common shares for the ten trading days immediately preceding the Due Diligence Deadline (as defined below) (the “Closing Shares”). The Closing Shares, to be due on the Closing Date, which Closing Shares are restricted as to resale and issued under a private placement exempt from registration under Section 4(a) (2) of the Securities Act, are subject to release of restriction and lockup on a quarterly basis over ten quarters commencing on the Closing Date in equal amounts of shares over ten consecutive calendar quarters. | ||
Cash payable for agreement | $725,000 in cash payable follows: (a) $225,000 payable on the Effective Date; and (b) $500,000 payable within 120 days after the Effective Date, to reimburse MNG for, without limitation, satisfaction of all the secured debt as listed in Section 2.04 of the Disclosure Schedules to the Agreement (the “Secured Debt”) | ||
Payment agreement description | The number of shares of Company’s common stock (rounded up to the nearest whole number) to be issued in two tranches that equals (i) $8,000,000 divided by (ii) a per share price equal to the VWAP of the Company’s common shares for the ten trading days immediately before the issuance date of those shares (“Post Closing Shares”). $5,000,000 of the Post-Closing Shares will be issued on June 30, 2022, to be held in Escrow. $3,000,000 of the Post-Closing Shares will be issued to MNG on December 31, 2022, to be held in Escrow. | ||
Intellectual Property [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Purchase price of purchased asset | $ 14,475,000 | ||
Intellectuals Property [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Purchase price of purchased asset | $ 225,000 |
SCHEDULE OF ACCOUNTS PAYABLE AN
SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED LIABILITIES (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Payables and Accruals [Abstract] | ||
Accounts payable | $ 197,187 | $ 991,565 |
Accrued expenses | 813,861 | 905,629 |
Others | 69,421 | 33,794 |
Accounts Payable and Accrued Liabilities | $ 1,080,469 | $ 1,930,988 |
ACCOUNTS PAYABLE AND ACCRUED _3
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES (Details Narrative) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Payables and Accruals [Abstract] | ||
Accounts Payable, Current | $ 744,191 | |
Accrued liabilities | $ 500,000 | 487,983 |
[custom:DirectorsFeesPayable-0] | $ 29,817 | 128,448 |
Unpaid of initial public offering cost | $ 297,437 |
SENIOR SECURED DEBENTURES (Deta
SENIOR SECURED DEBENTURES (Details Narrative) | Jun. 24, 2021USD ($)$ / sharesshares | May 27, 2021shares | Mar. 24, 2021USD ($) | Sep. 30, 2021USD ($)$ / shares | Sep. 30, 2021USD ($)$ / shares |
Short-term Debt [Line Items] | |||||
Stock Issued During Period, Shares, New Issues | shares | 820,029 | ||||
Stock Issued During Period, Value, New Issues | $ 13,262,712 | $ 13,262,712 | |||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 6 | $ 6 | |||
Fair Value Adjustment of Warrants | $ 818,960 | ||||
Warrant [Member] | |||||
Short-term Debt [Line Items] | |||||
Class of Warrant or Right, Number of Securities Called by Each Warrant or Right | shares | 93,938 | ||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 3.99 | ||||
Warrants and Rights Outstanding, Term | 3 years | ||||
Bridge Warrant [Member] | |||||
Short-term Debt [Line Items] | |||||
Fair Value Adjustment of Warrants | 199,255 | ||||
Securities Purchase Agreement [Member] | Warrant [Member] | Measurement Input, Share Price [Member] | |||||
Short-term Debt [Line Items] | |||||
Fair Value Adjustment of Warrants | $ 71,414 | ||||
Warrants and Rights Outstanding, Measurement Input | 2.23 | 2.23 | |||
Securities Purchase Agreement [Member] | Warrant [Member] | Measurement Input, Price Volatility [Member] | |||||
Short-term Debt [Line Items] | |||||
Warrants and Rights Outstanding, Measurement Input | 75 | 75 | |||
Securities Purchase Agreement [Member] | Warrant [Member] | Measurement Input, Risk Free Interest Rate [Member] | |||||
Short-term Debt [Line Items] | |||||
Warrants and Rights Outstanding, Measurement Input | 0.67 | 0.67 | |||
Securities Purchase Agreement [Member] | Warrant [Member] | Measurement Input, Expected Term [Member] | |||||
Short-term Debt [Line Items] | |||||
Warrants and Rights Outstanding, Term | 3 years | 3 years | |||
Accredited Investors [Member] | Senior Secured Debentures [Member] | |||||
Short-term Debt [Line Items] | |||||
Debt, maturity date | Jul. 13, 2021 | ||||
Stock Issued During Period, Shares, New Issues | shares | 10,000 | ||||
Stock Issued During Period, Value, New Issues | $ 60,000 | ||||
Accredited Investors [Member] | Securities Purchase Agreement [Member] | |||||
Short-term Debt [Line Items] | |||||
Debt principal amount | $ 750,000 | ||||
Subscription amount | $ 600,000 | ||||
Debt, maturity date | Jun. 24, 2021 | ||||
Debenture Holders [Member] | Securities Purchase Agreement [Member] | |||||
Short-term Debt [Line Items] | |||||
Transaction costs | $ 69,000 |
LONG TERM LOAN (Details Narrati
LONG TERM LOAN (Details Narrative) - Loan Agreement [Member] - Alterna Bank [Member] | 1 Months Ended | 12 Months Ended | 13 Months Ended | ||
Apr. 30, 2021USD ($) | Dec. 31, 2020CAD ($) | Apr. 30, 2021CAD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2020CAD ($) | |
Line of Credit Facility [Line Items] | |||||
Debt principal amount | $ 31,417 | ||||
Debt, maturity date | Dec. 31, 2022 | ||||
Debt, forgiveness percentage | 25.00% | ||||
Debt instrument, interest rate | 5.00% | 5.00% | |||
Debt instrument, description | the extended term i.e. January 31, 2023 to December 31, 2025 | ||||
Proceeds from loan | $ 15,932 | ||||
CAD [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Debt principal amount | $ 40,000 | ||||
Debt instrument, forgiveness | $ 10,000 | ||||
Proceeds from loan | $ 20,000 |
WARRANT LIABILITY (Details Narr
WARRANT LIABILITY (Details Narrative) - USD ($) | 9 Months Ended | |
Sep. 30, 2021 | Jul. 15, 2021 | |
Warrant exercise price | $ 6 | |
Fair value of warrant liability | $ 818,960 | |
Series A Warrants [Member] | ||
Number of warrant liability | 3,088,198 | 39,800 |
Warrant exercise price | $ 6 | |
Warrant [Member] | ||
Number of warrant liability | 135,999 | |
Bridge Warrants [Member] | ||
Number of warrant liability | 93,938 |
SHARE CAPITAL (Details Narrativ
SHARE CAPITAL (Details Narrative) - USD ($) | Sep. 02, 2021 | Jul. 28, 2021 | Jul. 15, 2021 | Jul. 13, 2021 | Jul. 12, 2021 | Jun. 24, 2021 | May 31, 2021 | May 28, 2021 | May 27, 2021 | Mar. 29, 2021 | May 10, 2019 | May 02, 2019 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | ||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||||
Stock Issued During Period, Value, Issued for Services | $ 76,760 | $ 106,521 | $ 357,269 | $ 418,926 | ||||||||||||||||
Number of stock issued during period | 820,029 | |||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 1,113,701 | |||||||||||||||||||
Stock option granted | 405,059 | |||||||||||||||||||
Shares vesting period | 3 years | 3 years | 3 years | |||||||||||||||||
Stock option, exercisable tem | 5 years | 5 years | 5 years | |||||||||||||||||
Stock options, exercise price | $ 7 | $ 7 | $ 7 | $ 7 | ||||||||||||||||
Fair value of stock options | $ 85,693 | $ 1,480,000 | $ 32,530 | |||||||||||||||||
Stock price | $ 3.86 | $ 6 | 2.30 | $ 2.30 | ||||||||||||||||
Expected volatality | 80.00% | 80.00% | 80.00% | |||||||||||||||||
Risk free rate of return | 0.88% | 0.98% | 1.11% | |||||||||||||||||
Expected term | 3 years | 3 years | 3 years | |||||||||||||||||
Unrecognized compensation cost | $ 901,575 | |||||||||||||||||||
Expected recognition period | 3 years | |||||||||||||||||||
Proceeds from issuance of public offering | $ 15,639,990 | |||||||||||||||||||
Underwriting discounts and commissions | $ 1,251,199 | |||||||||||||||||||
Exercise price of warrants | $ 6 | $ 6 | ||||||||||||||||||
Stock Term | 3 years | |||||||||||||||||||
Strike price per share | $ 3.99 | |||||||||||||||||||
Common Stock [Member] | ||||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||||
Shares issued for consulting services, shares | [1] | 15,000 | 62,237 | 96,029 | ||||||||||||||||
Stock Issued During Period, Value, Issued for Services | $ 69,300 | [1] | $ 349,809 | [1] | $ 324,868 | [1] | ||||||||||||||
Number of stock issued during period | 39,800 | 3,127,998 | [1] | 3,127,998 | [1] | |||||||||||||||
Series A Warrants [Member] | ||||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||||
Exercise of warrant | 39,800 | 3,088,198 | 3,088,198 | |||||||||||||||||
Exercise price of warrants | $ 6 | |||||||||||||||||||
Warrants [Member] | ||||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||||
Exercise of warrant | 93,938 | |||||||||||||||||||
IPO [Member] | ||||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||||
Number of shares sold | 3,127,998 | |||||||||||||||||||
Public offering price per share | $ 5 | |||||||||||||||||||
Gross proceeds for sale of shares | $ 15,639,990 | |||||||||||||||||||
Proceeds from issuance of public offering | $ 14,388,791 | |||||||||||||||||||
IPO [Member] | Series A Preferred Stock [Member] | ||||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||||
Number of stock issued during period | 53,474 | |||||||||||||||||||
Officer [Member] | ||||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||||
Shares issued for consulting services, shares | 98,356 | |||||||||||||||||||
Stock option granted | 55,445 | 49,284 | ||||||||||||||||||
Consultants [Member] | ||||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||||
Number of common shares issued fpr debt | 10,000 | |||||||||||||||||||
IPO [Member] | Series A Preferred Stock [Member] | ||||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||||
Conversion of stock, shares | 2,258,826 | |||||||||||||||||||
Consultants [Member] | ||||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||||
Number of stock issued during period | 15,000 | |||||||||||||||||||
Directors [Member] | ||||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||||
Number of stock issued during period | 19,992 | |||||||||||||||||||
Third Party [Member] | ||||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||||
Shares issued for consulting services, shares | 30,000 | |||||||||||||||||||
Stock Issued During Period, Value, Issued for Services | $ 179,700 | |||||||||||||||||||
Holders [Member] | ||||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||||
Stock dividend shares | 48,791 | 86,739 | ||||||||||||||||||
Consultants [Member] | ||||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||||
Number of stock issued during period | 7,237 | |||||||||||||||||||
[1] | reflects the 1:4.75 |
SCHEDULE OF FUTURE PAYMENTS UND
SCHEDULE OF FUTURE PAYMENTS UNDER LEASE (Details) | Sep. 30, 2021USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Remainder of 2021 | $ 68,137 |
2022 | 273,962 |
2023 | 279,610 |
2024 | 289,495 |
2025 | 306,442 |
2026 | 306,442 |
Subsequent years | 842,714 |
Total | $ 2,366,802 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | May 15, 2019 | |
HydroHaus Horticulture Inc [Member] | Licensing [Member] | ||
Loss contingency | $ 130,000 | |
Accrued expense payable | $ 100,000 | |
Common Class A [Member] | Consulting Services [Member] | ||
Stock Issued During Period, Shares, Issued for Services | 500,000 | |
Reverse Split [Member] | Common Class A [Member] | Consulting Services [Member] | ||
Stock Issued During Period, Shares, Issued for Services | 105,263 | |
Technology and Attendant Intellectual Property Rights [Member] | Common Class A [Member] | ||
Shares issued as consideration for purchase of asset | 25,000,000 | |
Technology and Attendant Intellectual Property Rights [Member] | Reverse Split [Member] | Common Class A [Member] | ||
Shares issued as consideration for purchase of asset | 5,263,158 |