Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2021 | Nov. 15, 2021 | |
Cover [Abstract] | ||
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 | 001-40867 | |
Entity Registrant Name | Volcon, Inc. | |
Entity Central Index Key | 0001829794 | |
Entity Tax Identification Number | 84-4882689 | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 2590 Oakmont Drive | |
Entity Address, Address Line Two | Suite 520 | |
Entity Address, City or Town | Round Rock | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 78665 | |
City Area Code | (512) | |
Local Phone Number | 400-4271 | |
Title of 12(b) Security | Common Stock | |
Trading Symbol | VLCN | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | No | |
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 | 0 |
CONSOLIDATED BALANCE SHEETS (un
CONSOLIDATED BALANCE SHEETS (unaudited) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash | $ 2,657,379 | $ 536,082 |
Accounts receivable | 35,663 | 0 |
Inventory | 2,328,686 | 0 |
Inventory deposits | 2,940,314 | 0 |
Prepaid expenses and other current assets | 341,314 | 102,789 |
Total current assets | 8,303,356 | 638,871 |
Long term assets: | ||
Property and equipment, net | 761,042 | 305,271 |
Intangible assets - domain names, net | 20,248 | 16,954 |
Other long-term assets | 749,187 | 50,560 |
Right of use asset - operating lease | 2,296,872 | 842,357 |
Total assets | 12,130,705 | 1,854,013 |
Current liabilities: | ||
Accounts payable | 1,330,714 | 81,400 |
Accrued liabilities | 154,366 | 34,044 |
Current portion of notes payable | 17,438 | 8,873 |
Right of use operating lease liability, short term | 328,337 | 141,943 |
Customer deposits | 2,334,105 | 55,865 |
Promissory Notes | 1,138,844 | 0 |
SAFE liability | 0 | 2,000,000 |
Total current liabilities | 5,303,804 | 2,322,125 |
Notes payable, net of discount and current portion | 73,218 | 59,329 |
Right of use operating lease liability, long term | 1,964,779 | 614,414 |
Total liabilities | 7,341,801 | 2,995,868 |
Stockholders' equity (deficit): | ||
Common stock: $0.00001 par value, 100,000,000 shares authorized, 2,569,717 shares issued and outstanding as of September 30, 2021, 1,937,500 issued or outstanding as of December 31, 2020 | 13 | 8 |
Additional paid-in capital | 31,509,121 | 232,550 |
Accumulated deficit | (26,720,253) | (1,374,413) |
Total stockholders’ equity (deficit) | 4,788,904 | (1,141,855) |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT) | 12,130,705 | 1,854,013 |
Series A Preferred Stock [Member] | ||
Stockholders' equity (deficit): | ||
Preferred stock value | 12 | 0 |
Series B Preferred Stock [Member] | ||
Stockholders' equity (deficit): | ||
Preferred stock value | $ 11 | $ 0 |
CONSOLIDATED BALANCE SHEETS (_2
CONSOLIDATED BALANCE SHEETS (unaudited) (Parenthetical) - $ / shares | Sep. 30, 2021 | Dec. 31, 2020 |
Preferred stock, par value | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares authorized (in shares) | 2,900,000 | |
Common stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 2,569,717 | 1,937,500 |
Common stock, shares outstanding (in shares) | 2,569,717 | 1,937,500 |
Series A Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized (in shares) | 1,400,000 | 0 |
Preferred Stock, Shares Issued | 1,191,388 | 0 |
Preferred Stock, Shares Outstanding | 1,191,388 | 0 |
Series B Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized (in shares) | 1,500,000 | 0 |
Preferred Stock, Shares Issued | 1,105,827 | 0 |
Preferred Stock, Shares Outstanding | 1,105,827 | 0 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) - USD ($) | 3 Months Ended | 7 Months Ended | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2020 | Sep. 30, 2021 | |
Income Statement [Abstract] | ||||
Revenue | $ 75,067 | $ 0 | $ 0 | $ 75,067 |
Cost of goods sold | 1,176,691 | 0 | 0 | 1,176,691 |
Gross margin | (1,101,624) | 0 | 0 | (1,101,624) |
Operating expenses: | ||||
Sales and marketing | 1,135,205 | 9,346 | 26,946 | 1,937,745 |
Product development | 3,021,207 | 281,462 | 331,621 | 7,595,581 |
General and administrative expenses | 586,494 | 13,751 | 18,090 | 14,634,037 |
Total operating expenses | 4,742,906 | 304,559 | 376,657 | 24,167,363 |
Loss from operations | (5,844,530) | (304,559) | (376,657) | (25,268,987) |
Other income (expense) | (3,842) | 0 | 0 | (9,332) |
Interest expense | (42,183) | 0 | 0 | (67,521) |
Total other expense | (46,025) | 0 | 0 | (76,853) |
Loss before provision for income taxes | (5,890,555) | (304,559) | (376,657) | (25,345,840) |
Provision for income taxes | 0 | 0 | 0 | 0 |
Net loss | $ (5,890,555) | $ (304,559) | $ (376,657) | $ (25,345,840) |
Net loss per common share – basic and diluted | $ (2.55) | $ (2.42) | $ (7.31) | $ (11.95) |
Weighted average common shares outstanding – basic and diluted | 2,303,508 | 125,687 | 51,520 | 2,121,129 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (DEFICIT) (unaudited) - USD ($) | Common Stock [Member] | Series A Preferred Stocks [Member] | Series B Preferred Stocks [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Total |
Beginning balance, value at Feb. 20, 2020 | ||||||
Beginning balance, shares at Feb. 20, 2020 | ||||||
Issuance of founders shares for cash | $ 7 | 10,826 | 10,833 | |||
Issuance of founders shares for cash, shares | 1,625,000 | |||||
Proceeds from WeFunder offering, net of issuance costs of $53,500 | 0 | |||||
Issuance of common stock with promissory notes, net of issuance costs of $65,000 | 0 | |||||
Stock-based compensation | $ 1 | 60,962 | 60,963 | |||
Stock-based compensation, shares | 312,500 | |||||
Net loss | (376,657) | (376,657) | ||||
Ending balance, value at Sep. 30, 2020 | $ 8 | 71,788 | (376,657) | (304,861) | ||
Ending balance, shares at Sep. 30, 2020 | 1,937,500 | |||||
Beginning balance, value at Dec. 31, 2020 | $ 8 | 232,550 | (1,374,413) | (1,141,855) | ||
Beginning balance, shares at Dec. 31, 2020 | 1,937,500 | |||||
Proceeds from WeFunder offering, net of issuance costs of $53,500 | 2,205,440 | 2,205,440 | ||||
Issuance of series A preferred stock, net of issuance costs of $205,470 | $ 4 | 2,464,504 | 2,464,508 | |||
Issuance of series A preferred stock, net of issuance costs, shares | 79,750 | 415,287 | ||||
Conversion of WeFunder offering to series A preferred stock | $ 4 | (4) | ||||
Conversion of WeFunder offering to series A preferred stock, shares | 351,832 | |||||
Conversion of SAFE Liability to series A preferred stock | $ 4 | 1,999,996 | 2,000,000 | |||
Conversion of SAFE Liability to series A preferred stock, shares | 424,269 | |||||
Issuance of series B preferred stock, net of issuance costs of $890,026 | $ 11 | 9,615,320 | 9,615,331 | |||
Issuance of series B preferred stock, net of issuance costs, shares | 123,296 | 1,105,827 | ||||
Issuance of common stock with promissory notes, net of issuance costs of $65,000 | $ 3 | 734,997 | $ 735,000 | |||
Issuance of common stock with promissory notes, net of issuance costs, shares | 266,664 | |||||
Stock-based compensation | $ 2 | 14,256,318 | $ 14,256,318 | |||
Stock-based compensation, shares | 162,507 | |||||
Net loss | (25,345,840) | (25,345,840) | ||||
Ending balance, value at Sep. 30, 2021 | $ 13 | $ 12 | $ 11 | $ 31,509,121 | $ (26,720,253) | $ 4,788,904 |
Ending balance, shares at Sep. 30, 2021 | 2,569,717 | 1,191,388 | 1,105,827 |
CONSOLIDATED STATEMENTS OF CH_2
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (DEFICIT) (unaudited) (Parenthetical) - USD ($) | 2 Months Ended | 5 Months Ended | 9 Months Ended |
Feb. 28, 2021 | May 31, 2021 | Sep. 30, 2021 | |
Series A Preferred Stock [Member] | |||
Payments of Stock Issuance Costs | $ 205,470 | $ 205,470 | |
Series B Preferred Stock [Member] | |||
Payments of Stock Issuance Costs | $ 890,026 | 890,026 | |
WeFunder Offering [Member] | |||
Payments of Stock Issuance Costs | 53,500 | ||
Common Stock With Promissory Notes [Member] | |||
Payments of Stock Issuance Costs | $ 65,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) - USD ($) | 7 Months Ended | 9 Months Ended |
Sep. 30, 2020 | Sep. 30, 2021 | |
Cash flow from operating activities: | ||
Net loss | $ (376,657) | $ (25,345,840) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Stock-based compensation | 60,963 | 14,256,318 |
Loss on disposal of tooling | 0 | 145,000 |
Expenses funded by related party | 53,662 | 0 |
Amortization of right of use asset | 0 | 252,951 |
Noncash interest expense | 0 | 58,312 |
Depreciation and amortization | 194 | 134,557 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 0 | (35,663) |
Inventory | 0 | (2,328,686) |
Inventory deposits | 0 | (2,940,314) |
Prepaid assets and other current assets | (10,000) | (238,525) |
Other assets | 0 | (698,627) |
Accounts payable | 59,230 | 1,249,314 |
Accrued liabilities | 0 | 120,322 |
Right of use liabilities - operating lease | 0 | (194,175) |
Customer deposits | 0 | 2,278,240 |
Net cash provided by (used in) operating activities | (212,608) | (13,286,816) |
Cash flow from investing activities: | ||
Purchase of property and equipment | 0 | (694,553) |
Purchase of intangible assets | (17,438) | (13,125) |
Net cash used by investing activities | (17,438) | (707,678) |
Cash flow from financing activities: | ||
Proceeds from SAFE liability | 1,625,000 | 0 |
Proceeds from WeFunder offering, net of offering costs of $53,500 | 0 | 2,205,440 |
Repayment of notes payable | 0 | (8,488) |
Repayment of related party note | (21,286) | 0 |
Proceeds from issuance of Series A preferred stock, net of $205,470 of issuance costs | 0 | 2,464,508 |
Proceeds from issuance of Series B preferred stock, net of $890,026 of issuance costs | 0 | 9,615,331 |
Proceeds from issuance of promissory notes, net of issuance costs of $96,000 | 0 | 1,104,000 |
Proceeds from issuance of founders shares | 10,833 | 0 |
Proceeds from issuance of common stock with promissory notes, net of $65,000 of issuance costs | 0 | 735,000 |
Net cash provided by financing activities | 1,614,547 | 16,115,791 |
NET CHANGE IN CASH | 1,384,501 | 2,121,297 |
CASH AT BEGINNING OF PERIOD | 0 | 536,082 |
CASH AT END OF PERIOD | 1,384,501 | 2,657,379 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | 0 | 9,209 |
Cash paid for income taxes | 0 | 0 |
Non-cash transactions | ||
Recognition of initial Right of use asset - operating lease | 0 | 1,707,466 |
Acquisition of property and equipment with note payable | 0 | 30,942 |
Conversion of SAFE liability to Series A preferred stock | 0 | 2,000,000 |
Noncash increase in related party notes payable | $ 53,662 | $ 0 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) (Parenthetical) | 9 Months Ended |
Sep. 30, 2021USD ($) | |
Series A Preferred Stock [Member] | |
Securities Financing Transaction [Line Items] | |
Payments of Stock Issuance Costs | $ 205,470 |
Series B Preferred Stock [Member] | |
Securities Financing Transaction [Line Items] | |
Payments of Stock Issuance Costs | 890,026 |
WeFunder Offering [Member] | |
Securities Financing Transaction [Line Items] | |
Payments of Stock Issuance Costs | 53,500 |
Promissory Notes [Member] | |
Securities Financing Transaction [Line Items] | |
Payments of Stock Issuance Costs | 96,000 |
Common Stock With Promissory Notes [Member] | |
Securities Financing Transaction [Line Items] | |
Payments of Stock Issuance Costs | $ 65,000 |
ORGANIZATION, NATURE OF OPERATI
ORGANIZATION, NATURE OF OPERATIONS AND GOING CONCERN | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
ORGANIZATION, NATURE OF OPERATIONS AND GOING CONCERN | NOTE 1 – ORGANIZATION, NATURE OF OPERATIONS AND GOING CONCERN Organization and Nature of Operations Volcon, Inc. (“Volcon”) was formed on February 21, 2020, as a Delaware Corporation, under the name Frog ePowersports, Inc. The Company was renamed Volcon on October 1, 2020. Volcon is developer and manufacturer of all-electric off road powersport vehicles. On January 5, 2021, the Company created Volcon ePowersports, LLC, (“Volcon LLC”) a Colorado wholly owned subsidiary of the Company, to sell Volcon vehicles and accessories in the United States. Going Concern The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. The Company has recurring losses and generated negative cash flows from operations since inception. Due to these conditions, it raised substantial doubt about its ability to continue as a going concern. Management intends to finance operating costs over the next twelve months with loans or the sale of equity. The consolidated financial statements do not include any adjustments that may result should the Company be unable to continue as a going concern. Impact of COVID-19 The outbreak of the 2019 novel coronavirus disease (“COVID-19”), which was declared a global pandemic by the World Health Organization on March 11, 2020, and the related responses by public health and governmental authorities to contain and combat its outbreak and spread, has severely impacted the U.S. and world economies. Economic recessions, including those brought on by the COVID-19 outbreak may have a negative effect on the demand for the Company’s products and the Company’s operating results. The range of possible impacts on the Company’s business from the coronavirus pandemic could include: (i) changing demand for the Company’s products; and (ii) potential disruption to the Company’s supply chain and distribution network. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The significant accounting policies followed in the preparation of the consolidated financial statements are as follows: Basis of presentation The basis of accounting applied is United States generally accepted accounting principles (US GAAP). The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiary. All intercompany accounts, transactions and balances have been eliminated in consolidation. Stock Dividend On July 27, 2021, the board of directors approved a common stock dividend of 1.5 shares for each share of common stock. The Company has accounted for this as a stock split since all common stock shares, warrants, options and restricted stock unit amounts and common stock per share amounts will be adjusted for this stock dividend. All periods presented have been adjusted to reflect this stock dividend. As a result of the stock dividend, Series A and Series B preferred stock will convert at a ratio of 2.5 common share for each preferred share outstanding. Use of estimates The preparation of the financial statements in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the dates of the financial statements and the reported amounts of expenses during the reporting periods. Making estimates requires management to exercise judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, actual results could differ significantly from those estimates. Cash and cash equivalents Cash and cash equivalents include short-term investments with original maturities of 90 days or less at the date of purchase. The recorded value of our cash and cash equivalents approximates their fair value. Revenue recognition Revenue is recognized when the Company transfers control of the product to the customer and the 14-day acceptance period has expired, or acceptance has been received from the customer. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring control of vehicles, parts, and accessories. Consideration that is received in advance of the transfer of goods are recorded as customer deposits until delivery has occurred or the customer cancels their order and the consideration is returned to the customer. Sales and other taxes the Company collects concurrent with revenue-producing activities are excluded from revenue. If a right of return exists, the Company adjusts revenue for the estimated effect of returns. Until the Company develop sales history, it will estimate expected returns based on industry data for sales returns as a percent of sales, type of product, and a projection of this experience into the future. Our sales do not have a financing component. Sales promotions and incentives. Shipping and handling charges and costs. Product warranties The Company provides a one-year warranty on vehicles, and a two-year warranty on the battery pack. The Company accrues warranty reserves at the time a vehicle is delivered to the customer. Warranty reserves include the Company’s best estimate of the projected cost to repair or to replace any items under warranty, based on actual warranty experience as it becomes available and other known factors that may impact our evaluation of historical data. The Company reviews its reserves quarterly to ensure that its accruals are adequate in meeting expected future warranty obligations and will adjust estimates as needed. Factors that could have an impact on the warranty reserve include the following: changes in manufacturing quality, shifts in product mix, changes in warranty coverage periods, product recalls and changes in sales volume. Warranty expense is recorded as a component of cost of revenues in the statement of operations. The portion of the warranty provision which is expected to be incurred within 12 months from the balance sheet date will be classified as current, while the remaining amount will be classified as long-term liabilities. Inventory Inventory costs include material, labor and manufacturing overhead costs, including depreciation expense associated with the manufacture and distribution of the Company’s products. Inventories are stated at the lower of cost (first-in, first-out method) or net realizable value. Property, plant and equipment Property, plant and equipment are valued at cost. Additions are capitalized and maintenance and repairs are charged to expense as incurred. Gains and losses on dispositions of equipment are reflected in operations. Depreciation is provided using the straight-line method over the estimated useful lives of the assets as follows: Schedule of estimated useful lives for property, plant and equipment Category Estimated Machinery, tooling and equipment 3 7 Vehicles 5 Computers and software 3 Long-lived assets The Company’s long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the historical cost carrying value of an asset may no longer be appropriate. The Company assesses recoverability of the asset by comparing the undiscounted future net cash flows expected to result from the asset to its carrying value. If the carrying value exceeds the undiscounted future net cash flows of the asset, an impairment loss is measured and recognized. An impairment loss is measured as the difference between the net book value and the fair value of the long-lived asset. Leases Right-of-use ("ROU") assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the lease commencement date based on the estimated present value of lease payments over the lease term. Leases with an initial term of 12 months or less are not recorded on the balance sheet; the Company recognizes lease expense for these leases on a straight-line basis over the lease term. The Company does not separate non-lease components from the lease components to which they relate, and instead accounts for each separate lease and non-lease component associated with that lease component as a single lease component ASC 842 defines initial direct costs as only the incremental costs of signing a lease. Initial direct costs related to leasing that are not incremental are expensed as general and administrative expense in our statements of operations. The Company’s operating lease agreements primarily consist of leased real estate and are included within ROU assets – operating leases and ROU lease liabilities – operating leases on the balance sheets. The Company’s lease agreements may include options to extend the lease, which are not included in minimum lease payments unless they are reasonably certain to be exercised at lease commencement. The Company's leases do not provide an implicit rate, the Company uses its estimated incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Research and development expenses The Company records research and development expenses in the period in which they are incurred as a component of product development expenses. Income taxes Deferred taxes are determined utilizing the "asset and liability" method, whereby deferred tax asset and liability account balances are determined based on differences between financial reporting and the tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance, when it's more likely than not that deferred tax assets will not be realized in the foreseeable future. Deferred tax liabilities and assets are classified as current or non-current based on the underlying asset or liability or if not directly related to an asset or liability based on the expected reversal dates of the specific temporary differences. Fair value of financial instruments The Company discloses fair value measurements for financial and non-financial assets and liabilities measured at fair value. Fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The accounting standard establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. Level 2: Observable prices that are based on inputs not quoted on active markets but are corroborated by market data. Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs. Stock-based compensation The Company has a stock-based incentive award plan for our employees and directors. The Company measures stock-based compensation at the estimated fair value on the grant date and recognizes the amortization of stock-based compensation expense on a straight-line basis over the requisite service period, or when it is probable criteria will be achieved for performance-based awards. Fair value is determined based on assumptions related to the fair value of the Company common stock, stock volatility and risk-free rate of return. The Company has elected to recognize forfeitures when realized. Recently issued accounting pronouncements In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740) (“ASU 2019-12”): Simplifying the Accounting for Income Taxes. The new standard eliminates certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period, and the recognition of deferred tax liabilities for outside basis differences related to changes in ownership of equity method investments and foreign subsidiaries. The guidance also simplifies aspects of accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. For public business entities, it is effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. The Company is currently evaluating the potential impact of this standard on its financial statements. From time to time, new accounting pronouncements are issued by the Financial Accounting Standard Board (“FASB”) or other standard setting bodies that the Company adopts as of the specified effective date. The Company does not believe that the impact of recently issued standards that are not yet effective will have a material impact on the Company’s financial position or results of operations upon adoption. |
LONG _ LIVED ASSETS
LONG – LIVED ASSETS | 9 Months Ended |
Sep. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
LONG – LIVED ASSETS | NOTE 3 – LONG – LIVED ASSETS Property and equipment Property and equipment consist of the following: Schedule of property and equipment September 30, 2021 December 31, 2020 Machinery, tooling and equipment $ 454,303 $ 215,995 Vehicles 134,144 73,202 Demonstration vehicles 113,985 – Fixtures & furniture 72,346 – Leasehold improvements 17,124 – Computers 78,879 18,112 870,780 307,309 Less: Accumulated depreciation (109,738 ) (2,038 ) Total property, plant and equipment $ 761,042 $ 305,271 Depreciation expense for the three and nine months ended September 30, 2021, was $ 57,448 124,726 Intangible assets During 2020, the Company acquired certain domain names for $ 17,438 15 3,741 9,831 194 |
NOTES PAYABLE AND PROMISSORY NO
NOTES PAYABLE AND PROMISSORY NOTES | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
NOTES PAYABLE AND PROMISSORY NOTES | NOTE 4 – NOTES PAYABLE AND PROMISSORY NOTES Notes Payable In December 2020, the Company entered into a financing arrangement for $ 75,702 8.64 1,211 72 30,942 7.64 753 48 The following table provides the maturities of these notes payable as of September 30, 2021: Schedule of maturities for notes payable Remainder of 2021 $ 5,921 2022 23,685 2023 23,685 2024 23,685 2025 17,664 2026 and thereafter 14,654 Total future payments 109,294 Less: Interest (18,638 ) Total notes payable 90,656 Less current portion (17,438 ) Long-term notes payable $ 73,218 Promissory Notes On September 10, 2021, the Company entered into an agreement with two lenders to issue 6% promissory notes of $ 2.0 6 266,664 800,000 161,000 96,000 65,000 2,007,333 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Sep. 30, 2021 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 5 – RELATED PARTY TRANSACTIONS During the period from February 21, 2020 (inception) through December 31, 2020, the Company entered into a notes payable agreement with a company controlled by a founder and director of the Company which were secured by all assets of the Company, for cash proceeds of $ 75,000 5,000 A related party paid expenses of $63,083 on behalf of the Company. These advances were unsecured, and due on demand. The Company repaid $ 63,083 7,624 On October 1, 2020, the Company entered into an agreement with a consultant to serve as Chief Operating Officer and to manage the Company’s product development efforts. The consultant provided statements of work for the various projects to be executed and charged the Company hourly rates for his services. The Company also agreed to compensate a company owned by the consultant and his spouse $ 5,560 11,120 100,080 33,360 In November 2020, the Company entered into an operating lease with an entity controlled by the Company’s two founders for its future headquarters and production facility in Liberty Hill, Texas. The lease has a lease term of 5 years, and monthly payments ranging from approximately $15,000 per month to $17,000 per month over the lease term. In February 2021, the Company entered into an amendment of the lease related to its future headquarters to expand the leased premises. The Company paid an additional security deposit of $139,230 and additional prepaid rent of $315,588. The total minimum lease payments under the amended lease total approximately $3,930,170. Monthly payments for the initial lease and the amended agreement begin at the time a certificate of occupancy is received by the landlord, which is expected in the first quarter of 2023. |
STOCKHOLDERS_ EQUITY
STOCKHOLDERS’ EQUITY | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
STOCKHOLDERS’ EQUITY | NOTE 6 – STOCKHOLDERS’ EQUITY The Company is authorized to issue up to 100,000,000 0.00001 5,000,000 0.00001 Common stock During the period ending September 30, 2020, the Company sold 1,625,000 10,833 312,500 2,088 3,025,000 15 226,875 1.1 SAFE Agreements During the period ended December 31, 2020, the Company entered into SAFE agreements (Simple Agreement for Future Equity) with investors through an exchange for cash investments totaling $ 2,000,000 5 2,000,000 424,269 In January 2021, the Company completed a WeFunder SAFE offering which was convertible into Preferred Stock upon future financing events. The Company received gross proceeds of $ 2,258,940 53,500 351,832 Preferred Stock In 2021, the Company designated 1,400,000 415,287 2,669,978 205,470 79,750 79,775 5 2.57 In 2021, the Company designated 1,500,000 9.50 1,105,827 10,505,357 890,026 123,296 197,277 5 3.80 The Series A and Series B Preferred stock was converted to shares of common stock upon the closing of the Company’s initial public offering (see Note 11). Warrants During the period for the three and nine months ended September 30, 2021, the Company issued 150,000 151,590 $0.245 - $1.00 5 Additionally, the Company’s two founders, whom are both directors and one of which is the Chairman of the Board, each entered into an anti-dilution warrant with the Company. In the event of their ownership of the Company’s fully diluted capitalization being less than 25% or 18.75%, each individual would have received common stock warrants with an exercise price of $0.0041 to purchase sufficient shares to return them to those ownership percentages. The warrants were fully vested upon grant and have an exercise period of 10 years from the date of grant. As of December 31, 2020, no warrants were owed to the two founders. As discussed below, subsequent to December 31, 2020, the anti-dilution warrants were exchanged for a fixed number of warrants. In March 2021, the Company agreed to exchange the two anti-dilution warrants that were issued to Company founders for a total of 11,000,000 0.98 10 During the three and nine months ended September 30, 2021, the Company recognized expense of $ 151,720 13,274,861 67,574 The following is the activity related to common stock warrants during the nine months ended September 30, 2021: Schedule of warrant activity Common Stock Warrants Shares Weighted Weighted Intrinsic Value Outstanding at January 1, 2021 151,590 $ 0.004 9.17 Granted 11,427,052 1.04 9.35 Cancelled – $ – – Expired – $ – – Exercised – $ – – Outstanding at September 30, 2021 11,578,642 $ 1.03 9.34 $ 45,713,770 Exercisable at September 30, 2021 11,578,642 $ 1.03 9.34 $ 46,010,840 |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
STOCK-BASED COMPENSATION | NOTE 7 – STOCK-BASED COMPENSATION In January 2021, the Company’s board of directors adopted the Volcon, Inc. 2021 Stock Plan, (the “2021 Plan”). The 2021 Plan is a stock-based compensation plan that provides for discretionary grants of stock options, stock awards, and restricted stock unit awards to employees, members of the board of directors and consultants (including restricted stock units issued prior to the adoption of the plan as further discussed below). The Company has reserved a total of 3,000,000 703,243 Restricted Stock Units Beginning in October 2020, the Company entered into various agreements with employees where the Company agreed to award a total of 637,500 In July 2021, the Company’s CEO resigned effective July 30, 2021. The share-based awards of 187,500 187,500 (18,568) 179,795 603,544 The following is the restricted stock unit activity for the nine months ended September 30, 2021: Schedule of restricted stock unit activity Restricted Stock Units Outstanding January 1, 2021 637,500 Granted – Vested – Cancelled (187,500 ) Outstanding September 30, 2021 450,000 In January 2021, the Board of Directors authorized 250,000 162,507 594,775 Stock Options The following is the common stock options to employees and consultants for services during the nine months ended September 30, 2021: Schedule of stock option activity Common Stock Options Shares Weighted Weighted Intrinsic Value Outstanding at January 1, 2021 – $ – Granted 1,892,375 $ 2.72 – – Forfeited (218,125 ) $ 1.00 – – Exercised – $ – – – Outstanding at September 30, 2021 1,674,250 $ 1.73 9.75 $ 5,503,000 Exercisable at September 30, 2021 – $ – – $ – The Company valued the options using an estimated fair value of the shares of common stock between $ 0.98 5.00 71 105 0.77 0.85 6 121,798 244,151 1,515,784 Total stock-based compensation recorded for the three and nine months ended September 30, 2021 for all stock based compensation awards, including warrants, has been recorded as follows: Schedule of stock-based compensation expense Three Months September 30, 2021 Nine Months September 30, 2021 Cost of Goods Sold $ 188,860 $ 269,266 Sales and Marketing 160,622 237,028 Product Development 354,439 379,160 General and Administrative 145,804 13,370,865 Total $ 849,725 $ 14,256,318 |
LOSS PER COMMON SHARE
LOSS PER COMMON SHARE | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
LOSS PER COMMON SHARE | NOTE 8 – LOSS PER COMMON SHARE The basic net loss per common share is calculated by dividing the Company's net loss available to common shareholders by the weighted average number of common shares during the year. The diluted net loss per common share is calculated by dividing the Company's net loss available to common shareholders by the diluted weighted average number of common shares outstanding during the year. The diluted weighted average number of common shares outstanding is the basic weighted number of common shares adjusted for any potentially dilutive debt or equity. Common shares consisting of common stock warrants, stock options and restricted stock units totaling 13,641,017 1,191,388 1,105,827 5,743,175 Schedule of diluted net loss per share due to their antidilutive effect Three months Three months Nine months Period ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 Numerator: Net loss $ (5,890,555 ) $ (304,559 ) $ (25,345,840 ) $ (376,657 ) Denominator: Denominator for basic and diluted net loss per common share - weighted average of common shares 2,303,508 125,687 2,121,129 51,520 Basic and diluted net loss per common share $ (2.55 ) $ (2.42 ) $ (11.95 ) $ (7.31 ) |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 9 – INCOME TAXES Deferred taxes are determined by applying the provisions of enacted tax laws and rates for the jurisdictions in which the Company operates to the estimated future tax effects of the differences between the tax basis of assets and liabilities and their reported amounts in the Company's financial statements. A valuation allowance is established to reduce deferred tax assets if it is more likely than not that the related tax benefits will not be realized. Due to losses since inception and for all periods presented, no income tax benefit or expense has been recognized as a full valuation allowance has been established for any tax benefit that would have been recognized for the loss in any period presented. Significant components of the Company's deferred tax assets and liabilities are as follows: Schedule of deferred tax assets and liabilities September 30, 2021 December 31, 2020 Deferred tax assets Net operating losses $ 2,634,433 $ 242,000 Depreciation and amortization 28,481 – Research & development credit 54,571 – Lease liability 481,554 – Stock-based compensation 2,858,033 – Accrued expenses 32,417 – Other 336 – Total 6,089,825 242,000 Valuation allowance (5,607,482 ) (242,000 ) Net deferred tax asset (482,343 ) – Deferred tax liabilities Right of use assets (482,343 ) – Net Deferred tax liabilities $ – $ – Management currently believes that since the Company has a history of losses it is more likely than not that the deferred tax regarding the loss carry forwards and other temporary differences will not be realized in the foreseeable future. The Company believes that carryforward limitations will be applied to the historical net operating losses due to the recent change of control transition. The Company's cumulative net operating loss carry forward of approximately $ 12,545,000 The Company has recorded no liability for income taxes associated with unrecognized tax benefits at the date of adoption and has not recorded any liability associated with unrecognized tax benefits. Accordingly, the Company has not recorded any interest or penalty in regard to any unrecognized benefit. |
LEASES
LEASES | 9 Months Ended |
Sep. 30, 2021 | |
Leases [Abstract] | |
LEASES | NOTE 10 – LEASES The Company did not have any leases during the period from February 21, 2020 (inception) to September 30, 2020. The components of lease cost for operating leases for the three and nine months ended September 30, 2021, were as follows: Schedule of lease cost for operating leases Three Months Ended September 30, 2021 Nine months Ended September 20, 2021 Lease Cost Operating lease cost $ 121,932 $ 252,951 Short-term lease cost 61,226 132,697 Variable lease cost – – Sublease income – – Total lease cost $ 183,158 $ 385,648 Supplemental cash flow information related to leases for the nine months ended September 30, 2021, was as follows: Schedule of supplemental cash flow information related to leases September 30, 2020 Other Lease Information Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 194,175 The following table summarizes the lease-related assets and liabilities recorded on the balance sheet at September 30, 2021 and December 31, 2020: Schedule of lease-related assets and liabilities September 30, 2021 December 31, 2020 Lease Position Operating Leases Operating lease right-of-use assets $ 2,296,872 $ 842,357 Right of use liability operating lease short term 328,337 141,943 Right of use liability operating lease long term 1,964,779 614,414 Total operating lease liabilities $ 2,293,116 $ 756,357 The Company utilizes the incremental borrowing rate in determining the present value of lease payments unless the implicit rate is readily determinable. The Company recognized an initial right of use asset and lease liability of $1,707,466 for leases entered into in the nine months ended September 30, 2021. Schedule of right of use asset and lease liability September 30, 2021 Lease Term and Discount Rate Weighted-average remaining lease term (years) Operating leases 4.9 Weighted-average discount rate Operating leases 5.5 The following table provides the maturities of lease liabilities at September 30, 2021: Schedule of maturities of lease liabilities Operating Leases Maturity of Lease Liabilities at September 30, 2021 Remainder of 2021 $ 100,632 2022 759,522 2023 1,184,356 2024 1,143,532 2025 1,118,146 2026 and thereafter 910,289 Total future undiscounted lease payments 5,216,476 Less: Interest (599,568 ) Present value of lease liabilities $ 4,616,908 Note that amounts above include future payments for a lease related to a facility to be constructed in Liberty Hill, Texas by an entity associated with the Company’s founders (see Note 5) |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2021 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 11 – SUBSEQUENT EVENTS On October 8, 2021, the Company completed its initial public offering and sold 3,025,000 shares of its common stock at $5.50 per share. The Company received net proceeds of $15,040,125 after underwriter commissions and expenses of $1,597,375. The underwriting agreement provided the underwriter with the option to sell an additional 226,875 shares (the “Overallotment”) which can be sold for up to 45 days subsequent to the completion of the initial public offering at $5.50 per share. The underwriter was also issued a warrant to purchase 151,250 shares of the Company’s common stock at $6.88 per share. The warrant expires five years from the date of issuance. The Company’s Series A and Series B Preferred Stock was converted to 5,743,175 shares of common stock upon completion of the initial public offering. Shares issued upon conversion are subject to a lockup period of 180 days, upon which one-third of the shares can be sold, after an additional 30 days, another one-third of the shares can be sold, and after 30 more days, all shares can be sold. On October 26, 2021, the Company received notification that the underwriter was exercising its Overallotment and on October 29, 2021, the Company sold the additional shares and received net proceeds of $1,135,509. The underwriter was also issued a warrant to purchase 11,344 shares of the Company’s common stock at $6.88 per share. The warrant expires five years from the date of issuance. As of November 10, 2021, the Company has received exercise notices from warrant holders, other than the Company’s founders and the underwriter, representing 317,018 shares of common stock, that they are exercising their warrants on a cashless basis for 236,220 shares of common stock, of which 170,257 shares are subject to the same lockup period as the common shares issued upon conversion of the preferred stock. On November 12, 2021, the Company’s chief operating officer submitted his resignation to the Company to pursue a full-time role as chief executive officer of Monday Motorbikes. He will continue support the Company as needed through a 30-day transition period. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation The basis of accounting applied is United States generally accepted accounting principles (US GAAP). The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiary. All intercompany accounts, transactions and balances have been eliminated in consolidation. |
Stock Dividend | Stock Dividend On July 27, 2021, the board of directors approved a common stock dividend of 1.5 shares for each share of common stock. The Company has accounted for this as a stock split since all common stock shares, warrants, options and restricted stock unit amounts and common stock per share amounts will be adjusted for this stock dividend. All periods presented have been adjusted to reflect this stock dividend. As a result of the stock dividend, Series A and Series B preferred stock will convert at a ratio of 2.5 common share for each preferred share outstanding. |
Use of estimates | Use of estimates The preparation of the financial statements in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the dates of the financial statements and the reported amounts of expenses during the reporting periods. Making estimates requires management to exercise judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, actual results could differ significantly from those estimates. |
Cash and cash equivalents | Cash and cash equivalents Cash and cash equivalents include short-term investments with original maturities of 90 days or less at the date of purchase. The recorded value of our cash and cash equivalents approximates their fair value. |
Revenue recognition | Revenue recognition Revenue is recognized when the Company transfers control of the product to the customer and the 14-day acceptance period has expired, or acceptance has been received from the customer. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring control of vehicles, parts, and accessories. Consideration that is received in advance of the transfer of goods are recorded as customer deposits until delivery has occurred or the customer cancels their order and the consideration is returned to the customer. Sales and other taxes the Company collects concurrent with revenue-producing activities are excluded from revenue. If a right of return exists, the Company adjusts revenue for the estimated effect of returns. Until the Company develop sales history, it will estimate expected returns based on industry data for sales returns as a percent of sales, type of product, and a projection of this experience into the future. Our sales do not have a financing component. Sales promotions and incentives. Shipping and handling charges and costs. |
Product warranties | Product warranties The Company provides a one-year warranty on vehicles, and a two-year warranty on the battery pack. The Company accrues warranty reserves at the time a vehicle is delivered to the customer. Warranty reserves include the Company’s best estimate of the projected cost to repair or to replace any items under warranty, based on actual warranty experience as it becomes available and other known factors that may impact our evaluation of historical data. The Company reviews its reserves quarterly to ensure that its accruals are adequate in meeting expected future warranty obligations and will adjust estimates as needed. Factors that could have an impact on the warranty reserve include the following: changes in manufacturing quality, shifts in product mix, changes in warranty coverage periods, product recalls and changes in sales volume. Warranty expense is recorded as a component of cost of revenues in the statement of operations. The portion of the warranty provision which is expected to be incurred within 12 months from the balance sheet date will be classified as current, while the remaining amount will be classified as long-term liabilities. |
Inventory | Inventory Inventory costs include material, labor and manufacturing overhead costs, including depreciation expense associated with the manufacture and distribution of the Company’s products. Inventories are stated at the lower of cost (first-in, first-out method) or net realizable value. |
Property, plant and equipment | Property, plant and equipment Property, plant and equipment are valued at cost. Additions are capitalized and maintenance and repairs are charged to expense as incurred. Gains and losses on dispositions of equipment are reflected in operations. Depreciation is provided using the straight-line method over the estimated useful lives of the assets as follows: Schedule of estimated useful lives for property, plant and equipment Category Estimated Machinery, tooling and equipment 3 7 Vehicles 5 Computers and software 3 |
Long-lived assets | Long-lived assets The Company’s long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the historical cost carrying value of an asset may no longer be appropriate. The Company assesses recoverability of the asset by comparing the undiscounted future net cash flows expected to result from the asset to its carrying value. If the carrying value exceeds the undiscounted future net cash flows of the asset, an impairment loss is measured and recognized. An impairment loss is measured as the difference between the net book value and the fair value of the long-lived asset. |
Leases | Leases Right-of-use ("ROU") assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the lease commencement date based on the estimated present value of lease payments over the lease term. Leases with an initial term of 12 months or less are not recorded on the balance sheet; the Company recognizes lease expense for these leases on a straight-line basis over the lease term. The Company does not separate non-lease components from the lease components to which they relate, and instead accounts for each separate lease and non-lease component associated with that lease component as a single lease component ASC 842 defines initial direct costs as only the incremental costs of signing a lease. Initial direct costs related to leasing that are not incremental are expensed as general and administrative expense in our statements of operations. The Company’s operating lease agreements primarily consist of leased real estate and are included within ROU assets – operating leases and ROU lease liabilities – operating leases on the balance sheets. The Company’s lease agreements may include options to extend the lease, which are not included in minimum lease payments unless they are reasonably certain to be exercised at lease commencement. The Company's leases do not provide an implicit rate, the Company uses its estimated incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. |
Research and development expenses | Research and development expenses The Company records research and development expenses in the period in which they are incurred as a component of product development expenses. |
Income taxes | Income taxes Deferred taxes are determined utilizing the "asset and liability" method, whereby deferred tax asset and liability account balances are determined based on differences between financial reporting and the tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance, when it's more likely than not that deferred tax assets will not be realized in the foreseeable future. Deferred tax liabilities and assets are classified as current or non-current based on the underlying asset or liability or if not directly related to an asset or liability based on the expected reversal dates of the specific temporary differences. |
Fair value of financial instruments | Fair value of financial instruments The Company discloses fair value measurements for financial and non-financial assets and liabilities measured at fair value. Fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The accounting standard establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. Level 2: Observable prices that are based on inputs not quoted on active markets but are corroborated by market data. Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs. |
Stock-based compensation | Stock-based compensation The Company has a stock-based incentive award plan for our employees and directors. The Company measures stock-based compensation at the estimated fair value on the grant date and recognizes the amortization of stock-based compensation expense on a straight-line basis over the requisite service period, or when it is probable criteria will be achieved for performance-based awards. Fair value is determined based on assumptions related to the fair value of the Company common stock, stock volatility and risk-free rate of return. The Company has elected to recognize forfeitures when realized. |
Recently issued accounting pronouncements | Recently issued accounting pronouncements In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740) (“ASU 2019-12”): Simplifying the Accounting for Income Taxes. The new standard eliminates certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period, and the recognition of deferred tax liabilities for outside basis differences related to changes in ownership of equity method investments and foreign subsidiaries. The guidance also simplifies aspects of accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. For public business entities, it is effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. The Company is currently evaluating the potential impact of this standard on its financial statements. From time to time, new accounting pronouncements are issued by the Financial Accounting Standard Board (“FASB”) or other standard setting bodies that the Company adopts as of the specified effective date. The Company does not believe that the impact of recently issued standards that are not yet effective will have a material impact on the Company’s financial position or results of operations upon adoption. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Schedule of estimated useful lives for property, plant and equipment | Schedule of estimated useful lives for property, plant and equipment Category Estimated Machinery, tooling and equipment 3 7 Vehicles 5 Computers and software 3 |
LONG _ LIVED ASSETS (Tables)
LONG – LIVED ASSETS (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | Schedule of property and equipment September 30, 2021 December 31, 2020 Machinery, tooling and equipment $ 454,303 $ 215,995 Vehicles 134,144 73,202 Demonstration vehicles 113,985 – Fixtures & furniture 72,346 – Leasehold improvements 17,124 – Computers 78,879 18,112 870,780 307,309 Less: Accumulated depreciation (109,738 ) (2,038 ) Total property, plant and equipment $ 761,042 $ 305,271 |
NOTES PAYABLE AND PROMISSORY _2
NOTES PAYABLE AND PROMISSORY NOTES (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of maturities for notes payable | Schedule of maturities for notes payable Remainder of 2021 $ 5,921 2022 23,685 2023 23,685 2024 23,685 2025 17,664 2026 and thereafter 14,654 Total future payments 109,294 Less: Interest (18,638 ) Total notes payable 90,656 Less current portion (17,438 ) Long-term notes payable $ 73,218 |
STOCKHOLDERS_ EQUITY (Tables)
STOCKHOLDERS’ EQUITY (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
Schedule of warrant activity | Schedule of warrant activity Common Stock Warrants Shares Weighted Weighted Intrinsic Value Outstanding at January 1, 2021 151,590 $ 0.004 9.17 Granted 11,427,052 1.04 9.35 Cancelled – $ – – Expired – $ – – Exercised – $ – – Outstanding at September 30, 2021 11,578,642 $ 1.03 9.34 $ 45,713,770 Exercisable at September 30, 2021 11,578,642 $ 1.03 9.34 $ 46,010,840 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
Schedule of restricted stock unit activity | Schedule of restricted stock unit activity Restricted Stock Units Outstanding January 1, 2021 637,500 Granted – Vested – Cancelled (187,500 ) Outstanding September 30, 2021 450,000 |
Schedule of stock option activity | Schedule of stock option activity Common Stock Options Shares Weighted Weighted Intrinsic Value Outstanding at January 1, 2021 – $ – Granted 1,892,375 $ 2.72 – – Forfeited (218,125 ) $ 1.00 – – Exercised – $ – – – Outstanding at September 30, 2021 1,674,250 $ 1.73 9.75 $ 5,503,000 Exercisable at September 30, 2021 – $ – – $ – |
Schedule of stock-based compensation expense | Schedule of stock-based compensation expense Three Months September 30, 2021 Nine Months September 30, 2021 Cost of Goods Sold $ 188,860 $ 269,266 Sales and Marketing 160,622 237,028 Product Development 354,439 379,160 General and Administrative 145,804 13,370,865 Total $ 849,725 $ 14,256,318 |
LOSS PER COMMON SHARE (Tables)
LOSS PER COMMON SHARE (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of diluted net loss per share due to their antidilutive effect | Schedule of diluted net loss per share due to their antidilutive effect Three months Three months Nine months Period ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 Numerator: Net loss $ (5,890,555 ) $ (304,559 ) $ (25,345,840 ) $ (376,657 ) Denominator: Denominator for basic and diluted net loss per common share - weighted average of common shares 2,303,508 125,687 2,121,129 51,520 Basic and diluted net loss per common share $ (2.55 ) $ (2.42 ) $ (11.95 ) $ (7.31 ) |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Schedule of deferred tax assets and liabilities | Schedule of deferred tax assets and liabilities September 30, 2021 December 31, 2020 Deferred tax assets Net operating losses $ 2,634,433 $ 242,000 Depreciation and amortization 28,481 – Research & development credit 54,571 – Lease liability 481,554 – Stock-based compensation 2,858,033 – Accrued expenses 32,417 – Other 336 – Total 6,089,825 242,000 Valuation allowance (5,607,482 ) (242,000 ) Net deferred tax asset (482,343 ) – Deferred tax liabilities Right of use assets (482,343 ) – Net Deferred tax liabilities $ – $ – |
LEASES (Tables)
LEASES (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Leases [Abstract] | |
Schedule of lease cost for operating leases | Schedule of lease cost for operating leases Three Months Ended September 30, 2021 Nine months Ended September 20, 2021 Lease Cost Operating lease cost $ 121,932 $ 252,951 Short-term lease cost 61,226 132,697 Variable lease cost – – Sublease income – – Total lease cost $ 183,158 $ 385,648 |
Schedule of supplemental cash flow information related to leases | Schedule of supplemental cash flow information related to leases September 30, 2020 Other Lease Information Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 194,175 |
Schedule of lease-related assets and liabilities | Schedule of lease-related assets and liabilities September 30, 2021 December 31, 2020 Lease Position Operating Leases Operating lease right-of-use assets $ 2,296,872 $ 842,357 Right of use liability operating lease short term 328,337 141,943 Right of use liability operating lease long term 1,964,779 614,414 Total operating lease liabilities $ 2,293,116 $ 756,357 |
Schedule of right of use asset and lease liability | Schedule of right of use asset and lease liability September 30, 2021 Lease Term and Discount Rate Weighted-average remaining lease term (years) Operating leases 4.9 Weighted-average discount rate Operating leases 5.5 |
Schedule of maturities of lease liabilities | Schedule of maturities of lease liabilities Operating Leases Maturity of Lease Liabilities at September 30, 2021 Remainder of 2021 $ 100,632 2022 759,522 2023 1,184,356 2024 1,143,532 2025 1,118,146 2026 and thereafter 910,289 Total future undiscounted lease payments 5,216,476 Less: Interest (599,568 ) Present value of lease liabilities $ 4,616,908 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) | 9 Months Ended |
Sep. 30, 2021 | |
Machinery and Equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Lives | 3 years |
Machinery and Equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Lives | 7 years |
Vehicles [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Lives | 5 years |
Computer Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Lives | 3 years |
LONG - LIVED ASSETS (Details)
LONG - LIVED ASSETS (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment gross | $ 870,780 | $ 307,309 |
Total property, plant and equipment | 761,042 | 305,271 |
Machinery and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment gross | 454,303 | 215,995 |
Less: Accumulated depreciation | (109,738) | (2,038) |
Total property, plant and equipment | 761,042 | 305,271 |
Vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment gross | 134,144 | 73,202 |
Demonstration Vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment gross | 113,985 | 0 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment gross | 72,346 | 0 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment gross | 17,124 | 0 |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment gross | $ 78,879 | $ 18,112 |
LONG _ LIVED ASSETS (Details Na
LONG – LIVED ASSETS (Details Narrative) - USD ($) | 3 Months Ended | 7 Months Ended | 9 Months Ended | 10 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2020 | Sep. 30, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |||||
Depreciation expense | $ 57,448 | $ 124,726 | |||
Amortization expense | $ 3,741 | $ 194 | $ 194 | $ 9,831 | $ 17,438 |
Amortized over an estimated useful life | 15 years |
NOTES PAYABLE AND PROMISSORY _3
NOTES PAYABLE AND PROMISSORY NOTES (Details) | Sep. 30, 2021USD ($) |
Debt Disclosure [Abstract] | |
Remainder of 2021 | $ 5,921 |
2022 | 23,685 |
2023 | 23,685 |
2024 | 23,685 |
2025 | 17,664 |
2026 and thereafter | 14,654 |
Total future payments | 109,294 |
Less: Interest | (18,638) |
Total notes payable | 90,656 |
Less current portion | (17,438) |
Long-term notes payable | $ 73,218 |
NOTES PAYABLE AND PROMISSORY _4
NOTES PAYABLE AND PROMISSORY NOTES (Details Narrative) - USD ($) | Sep. 10, 2021 | Apr. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Sep. 30, 2021 | Feb. 20, 2020 |
Defined Benefit Plan Disclosure [Line Items] | ||||||
Financing cost | $ 30,942 | $ 75,702 | ||||
Interest rate | 7.64% | 8.64% | ||||
Periodic payment | $ 753 | $ 1,211 | ||||
Payments term | 48 months | 72 months | ||||
Shareholders' equity | $ (1,141,855) | $ (304,861) | $ 4,788,904 | |||
Proceeds from initial public offering | $ 0 | 2,205,440 | ||||
Promissory Notes [Member] | ||||||
Defined Benefit Plan Disclosure [Line Items] | ||||||
Convertible Debt | $ 2,000,000 | |||||
Debt instrument interest rate | 6.00% | |||||
Shares issued | 266,664 | |||||
Proceeds from promissory notes | $ 800,000 | |||||
Issuance costs | 161,000 | |||||
Allocated of promissory note | 96,000 | |||||
Shareholders' equity | 65,000 | |||||
Proceeds from initial public offering | $ 2,007,333 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 10 Months Ended | |
Dec. 31, 2020 | Sep. 30, 2021 | Sep. 30, 2021 | Dec. 31, 2020 | Oct. 02, 2020 | |
Related Party Transactions [Abstract] | |||||
Cash proceeds | $ 75,000 | ||||
Received cash proceeds | $ 5,000 | ||||
Repayment of related party debt | 63,083 | ||||
Repayment of interest | $ 7,624 | ||||
Warehouse and office space expenses | $ 5,560 | ||||
Rent Payments | $ 11,120 | ||||
Lease Expenses | $ 100,080 | $ 33,360 |
STOCKHOLDERS' EQUITY (Details)
STOCKHOLDERS' EQUITY (Details) - USD ($) | 9 Months Ended | 10 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Warrant [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Outstanding at end of period | 9 years 4 months 2 days | 9 years 2 months 1 day |
Granted | 9 years 4 months 6 days | |
Common Stock Warrants [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Class of Warrant or Right, Outstanding | 151,590 | |
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 0.004 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 11,427,052 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value | $ 1.04 | |
[custom:ShareBasedCompensationArrangementByShareBasedPaymentAwardNonOptionEquityInstrumentsCancelled] | 0 | |
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Expirations | 0 | |
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Exercised | 0 | |
Class of Warrant or Right, Outstanding | 11,578,642 | 151,590 |
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1.03 | $ 0.004 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Aggregate Intrinsic Value, Outstanding | $ 45,713,770 | |
[custom:ShareBasedCompensationArrangementByShareBasedPaymentAwardOtherThanOptionsExercisableNumber-0] | 11,578,642 | |
[custom:ClassOfWarrantOrRightExercisePriceOfWarrantsOrRights1Exercisable-0] | $ 1.03 | |
[custom:SharebasedCompensationArrangementBySharebasedPaymentAwardEquityInstrumentsOtherThanOptionsAggregateIntrinsicValueExercisable-0] | $ 46,010,840 | |
Equity Option [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Outstanding at end of period | 9 years 9 months | |
Exercisable at end of period | 9 years 4 months 2 days |
STOCKHOLDERS_ EQUITY (Details N
STOCKHOLDERS’ EQUITY (Details Narrative) - USD ($) | Oct. 08, 2021 | Oct. 29, 2021 | Mar. 31, 2021 | Jan. 31, 2021 | Sep. 30, 2020 | Feb. 28, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | May 31, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2020 |
Class of Stock [Line Items] | |||||||||||||
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 | 100,000,000 | 100,000,000 | |||||||||
Common stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 | $ 0.00001 | $ 0.00001 | |||||||||
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 | 5,000,000 | 5,000,000 | |||||||||
Preferred stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 | $ 0.00001 | $ 0.00001 | |||||||||
Cash proceeds | $ 75,000 | ||||||||||||
Net proceeds | $ 0 | $ 735,000 | |||||||||||
[custom:PreferredStockDesignated-0] | 2,900,000 | 2,900,000 | |||||||||||
Gross proceeds | $ 9,615,331 | ||||||||||||
Other expense | $ 60,963 | $ 14,256,318 | |||||||||||
Warrant [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Estimated life | 5 years | ||||||||||||
Common Stock Warrants [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1.03 | $ 1.03 | $ 0.004 | $ 0.004 | |||||||||
[custom:WarrantsIssuedShares] | 150,000 | 151,590 | 151,590 | 150,000 | |||||||||
Other expense | $ 151,720 | $ 67,574 | $ 67,574 | $ 13,274,861 | |||||||||
Common Stock Warrants [Member] | Company Founders [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Warrants and Rights Outstanding, Term | 10 years | ||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 0.98 | ||||||||||||
[custom:WarrantsIssuedShares] | 11,000,000 | ||||||||||||
Common Stock Warrants [Member] | Warrants Issued In 2021 [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
[custom:WarrantExercisePriceRange] | $0.245 - $1.00 | ||||||||||||
Common Stock [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Common stock shares sold | 1,625,000 | ||||||||||||
Cash proceeds | $ 10,833 | ||||||||||||
Offering shares | 312,500 | ||||||||||||
Expense related grant | $ 2,088 | ||||||||||||
Cash investments | $ 2,000,000 | $ 2,000,000 | |||||||||||
Diluted common stock | $ 5,000,000 | ||||||||||||
Gross proceeds | $ 2,258,940 | ||||||||||||
Prepaid expenses | $ 53,500 | ||||||||||||
Common Stock [Member] | One Financial Broker [Member] | Series A Preferred Stock Offering [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Offering shares | 79,750 | ||||||||||||
Common Stock [Member] | One Financial Broker [Member] | Series B Preferred Stock Offering [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Offering shares | 123,296 | ||||||||||||
Common Stock [Member] | Subsequent Event [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Common stock shares sold | 3,025,000 | 226,875 | |||||||||||
Net proceeds | $ 15,000,000 | $ 1,100,000 | |||||||||||
Series A Preferred Stock [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Preferred stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 | $ 0.00001 | $ 0.00001 | |||||||||
Offering shares | 415,287 | ||||||||||||
Converted preferred stock | 351,832 | 424,269 | 424,269 | ||||||||||
[custom:PreferredStockDesignated-0] | 1,400,000 | 1,400,000 | 0 | 0 | |||||||||
Gross proceeds | $ 2,669,978 | ||||||||||||
Payments of Stock Issuance Costs | $ 205,470 | $ 205,470 | |||||||||||
Common Stock Warrants [Member] | One Financial Broker [Member] | Series A Preferred Stock Offering [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Offering shares | 79,775 | ||||||||||||
Warrants and Rights Outstanding, Term | 5 years | ||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 2.57 | ||||||||||||
Common Stock Warrants [Member] | One Financial Broker [Member] | Series B Preferred Stock Offering [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Offering shares | 197,277 | ||||||||||||
Warrants and Rights Outstanding, Term | 5 years | ||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 3.80 | ||||||||||||
Series B Preferred Stock [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Preferred stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 | $ 0.00001 | $ 0.00001 | |||||||||
Offering shares | 1,105,827 | ||||||||||||
[custom:PreferredStockDesignated-0] | 1,500,000 | 1,500,000 | 0 | 0 | |||||||||
Gross proceeds | $ 10,505,357 | ||||||||||||
Payments of Stock Issuance Costs | $ 890,026 | $ 890,026 | |||||||||||
[custom:PreferredStockStatedValuePerShare-0] | $ 9.50 | $ 9.50 |
STOCK-BASED COMPENSATION (Detai
STOCK-BASED COMPENSATION (Details - Restricted stock unit activity) - Restricted Stock Units (RSUs) [Member] - shares | 1 Months Ended | 9 Months Ended |
Oct. 31, 2020 | Sep. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding, Number, Beginning Balance | 637,500 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 637,500 | 0 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period | 0 | |
[custom:ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsCancelledInPeriod] | (187,500) | |
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding, Number, Ending Balance | 450,000 |
STOCK-BASED COMPENSATION (Det_2
STOCK-BASED COMPENSATION (Details - Stock option activity) - Equity Option [Member] | 9 Months Ended |
Sep. 30, 2021USD ($)$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Outstanding at beginning of period | shares | 0 |
Outstanding at beginning of period | $ / shares | $ 0 |
Granted | shares | 1,892,375 |
Granted | $ / shares | $ 2.72 |
Forfeited | shares | (218,125) |
Forfeited | $ / shares | $ 1 |
Exercised | shares | 0 |
Exercised | $ / shares | $ 0 |
Exercised | $ | $ 0 |
Outstanding at end of period | shares | 1,674,250 |
Outstanding at end of period | $ / shares | $ 1.73 |
Outstanding at end of period | 9 years 9 months |
Outstanding at end of period | $ | $ 5,503,000 |
Exercisable at end of period | shares | 0 |
Exercisable at end of period | $ / shares | $ 0 |
Exercisable at end of period | $ | $ 0 |
STOCK-BASED COMPENSATION (Det_3
STOCK-BASED COMPENSATION (Details - Stock based compensation) - USD ($) | 3 Months Ended | 7 Months Ended | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2020 | Sep. 30, 2021 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total | $ 4,742,906 | $ 304,559 | $ 376,657 | $ 24,167,363 |
Warrant [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total | 849,725 | 14,256,318 | ||
Cost of Sales [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total | 188,860 | 269,266 | ||
Selling and Marketing Expense [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total | 160,622 | 237,028 | ||
In Process Research and Development [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total | 354,439 | 379,160 | ||
General and Administrative Expense [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total | $ 145,804 | $ 13,370,865 |
STOCK-BASED COMPENSATION (Det_4
STOCK-BASED COMPENSATION (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 7 Months Ended | 9 Months Ended | |||
Jul. 31, 2021 | Oct. 31, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Jan. 31, 2021 | Jan. 02, 2021 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Common stock shares reserved | 3,000,000 | ||||||
Shares available for issuance | 703,243 | 703,243 | |||||
Stock based compensation | $ 60,963 | $ 14,256,318 | |||||
Volatility minimum | 71.00% | ||||||
Volatility rate maximum | 105.00% | ||||||
Risk free interest rate minimum | 0.77% | ||||||
Risk free interest rate maximum | 0.85% | ||||||
Estimated life | 6 years | ||||||
Additional common stock options expenses | $ 1,515,784 | ||||||
Minimum [Member] | |||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Estimated fair value | $ 0.98 | $ 0.98 | |||||
Maximum [Member] | |||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Estimated fair value | $ 5 | $ 5 | |||||
Common Stock [Member] | |||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Stock based compensation | $ 1 | $ 2 | |||||
Director [Member] | |||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Common stock shares reserved | 250,000 | ||||||
Awards granted | 162,507 | ||||||
Restricted Stock Units (RSUs) [Member] | |||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Awards granted | 637,500 | 0 | |||||
Awards forfeited | 187,500 | ||||||
Share based (benefit) expense | $ (18,568) | ||||||
Stock based compensation | $ 179,795 | ||||||
Additional compensation expense | 603,544 | 603,544 | |||||
Restricted Stock Units (RSUs) [Member] | Common Stock [Member] | |||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Stock based compensation | 594,775 | ||||||
Equity Option [Member] | |||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Stock based compensation | $ 121,798 | $ 244,151 |
LOSS PER COMMON SHARE (Details)
LOSS PER COMMON SHARE (Details) - USD ($) | 3 Months Ended | 7 Months Ended | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2020 | Sep. 30, 2021 | |
Numerator: | ||||
Net loss | $ (5,890,555) | $ (304,559) | $ (376,657) | $ (25,345,840) |
Denominator: | ||||
Denominator for basic and diluted net loss per common share - weighted average of common shares | 2,303,508 | 125,687 | 51,520 | 2,121,129 |
Basic and diluted net loss per common share | $ (2.55) | $ (2.42) | $ (7.31) | $ (11.95) |
LOSS PER COMMON SHARE (Details
LOSS PER COMMON SHARE (Details Narrative) | 9 Months Ended |
Sep. 30, 2021shares | |
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |
[custom:RestrictedStockUnit] | 13,641,017 |
[custom:ConvertibleCommonStockShares] | 5,743,175 |
Series A Preferred Stock [Member] | |
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |
[custom:RestrictedStockUnit] | 1,191,388 |
Series B Preferred Stock [Member] | |
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |
[custom:RestrictedStockUnit] | 1,105,827 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Deferred tax assets | ||
Net operating losses | $ 2,634,433 | $ 242,000 |
Depreciation and amortization | 28,481 | 0 |
Research & development credit | 54,571 | 0 |
Lease liability | 481,554 | 0 |
Stock-based compensation | 2,858,033 | 0 |
Accrued expenses | 32,417 | 0 |
Other | 336 | 0 |
Total | 6,089,825 | 242,000 |
Valuation allowance | (5,607,482) | (242,000) |
Net deferred tax asset | (482,343) | 0 |
Right of use assets | (482,343) | 0 |
Net Deferred tax liabilities | $ 0 | $ 0 |
INCOME TAXES (Details Narrative
INCOME TAXES (Details Narrative) | Sep. 30, 2021USD ($) |
Income Tax Disclosure [Abstract] | |
Net operating loss carry forward | $ 12,545,000 |
LEASES (Details - Lease cost)
LEASES (Details - Lease cost) - USD ($) | 3 Months Ended | 9 Months Ended |
Sep. 30, 2021 | Sep. 30, 2021 | |
Lease Cost | ||
Operating lease cost | $ 121,932 | $ 252,951 |
Short-term lease cost | 61,226 | 132,697 |
Variable lease cost | 0 | 0 |
Sublease income | 0 | 0 |
Total lease cost | $ 183,158 | $ 385,648 |
LEASES (Details - Supplemental
LEASES (Details - Supplemental cash flow information related to leases) | 9 Months Ended |
Sep. 30, 2021USD ($) | |
Cash paid for amounts included in the measurement of lease liabilities: | |
Operating cash flows from operating leases | $ 194,175 |
LEASES (Details - Lease-related
LEASES (Details - Lease-related assets and liabilities) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Operating Leases | ||
Operating lease right-of-use assets | $ 2,296,872 | $ 842,357 |
Right of use liability operating lease short term | 328,337 | 141,943 |
Right of use liability operating lease long term | 1,964,779 | 614,414 |
Total operating lease liabilities | $ 2,293,116 | $ 756,357 |
LEASES (Details - Other informa
LEASES (Details - Other information) | Sep. 30, 2021 |
Leases [Abstract] | |
Weighted-average remaining lease term Operating leases | 4 years 10 months 24 days |
Weighted-average discount rate Operating leases | 5.50% |
LEASES (Details - Maturities of
LEASES (Details - Maturities of lease liabilities) | Sep. 30, 2021USD ($) |
Leases [Abstract] | |
Remainder of 2021 | $ 100,632 |
2022 | 759,522 |
2023 | 1,184,356 |
2024 | 1,143,532 |
2025 | 1,118,146 |
2026 and thereafter | 910,289 |
Total future undiscounted lease payments | 5,216,476 |
Less: Interest | (599,568) |
Present value of lease liabilities | $ 4,616,908 |