Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Nov. 08, 2018 | |
Details | ||
Registrant Name | Cannabis Sativa, Inc. | |
Registrant CIK | 1,360,442 | |
SEC Form | 10-Q | |
Period End date | Sep. 30, 2018 | |
Fiscal Year End | --12-31 | |
Trading Symbol | cbds | |
Tax Identification Number (TIN) | 201,898,270 | |
Number of common stock shares outstanding | 21,733,428 | |
Filer Category | Non-accelerated Filer | |
Current with reporting | Yes | |
Small Business | true | |
Emerging Growth Company | false | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Contained File Information, File Number | 000-53571 | |
Entity Incorporation, State Country Name | NEVADA | |
Entity Address, Address Line One | 1646 W. Pioneer Blvd., Suite 120 | |
Entity Address, City or Town | Mesquite | |
Entity Address, State or Province | Nevada | |
Entity Address, Postal Zip Code | 89,027 | |
City Area Code | 702 | |
Local Phone Number | 346-3906 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Current Assets | ||
Cash | $ 222,767 | $ 175,857 |
Digital Currency | 0 | 230,169 |
Accounts Receivable, net | 4,787 | 3,813 |
Prepaid Consulting and Other Current Assets | 55,092 | 1,083,769 |
Inventories | 8,239 | 8,511 |
Total Current Assets | 290,885 | 1,502,119 |
Property and Equipment, Net | 8,874 | 10,600 |
Intangible Assets, Net | 2,433,839 | 2,853,059 |
Investments | 208,938 | 0 |
Goodwill | 3,346,869 | 3,346,869 |
Total Assets | 6,289,405 | 7,712,647 |
Current Liabilities: | ||
Accounts Payable and Accrued Expenses | 97,336 | 108,153 |
Stock Payable | 1,300,729 | 767,603 |
Due to Related Parties | 876,623 | 623,093 |
Total Current Liabilities | 2,274,688 | 1,498,849 |
Stockholders' Equity: | ||
Preferred stock $0.001 par value; 5,000,000 shares authorized; 732,018 issued and outstanding | 732 | 732 |
Common stock $0.001 par value; 45,000,000 shares authorized; 20,951,119 and 20,803,216 shares issued and outstanding, respectively | 20,951 | 20,803 |
Additional Paid-In Capital | 71,717,078 | 70,782,434 |
Accumulated Other Comprehensive Income | 0 | 188,978 |
Accumulated Deficit | (69,583,996) | (66,790,415) |
Total Cannabis Sativa, Inc. Stockholders' Equity | 2,154,765 | 4,202,532 |
Non-Controlling Interest | 1,859,952 | 2,011,266 |
Total Stockholders' Equity | 4,014,717 | 6,213,798 |
Total Liabilities and Stockholders' Equity | $ 6,289,405 | $ 7,712,647 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS - Parenthetical - $ / shares | Sep. 30, 2018 | Dec. 31, 2017 |
Details | ||
Preferred Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 |
Preferred Stock, Shares Authorized | 5,000,000 | 5,000,000 |
Preferred Stock, Shares Issued | 732,018 | 732,018 |
Preferred Stock, Shares Outstanding | 732,018 | 732,018 |
Common Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 |
Common Stock, Shares Authorized | 45,000,000 | 45,000,000 |
Common Stock, Shares, Issued | 20,951,119 | 20,803,216 |
Common Stock, Shares, Outstanding | 20,951,119 | 20,803,216 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Details | ||||
Revenues | $ 107,616 | $ 121,400 | $ 408,680 | $ 124,446 |
Cost of Revenues | 53,745 | 69,144 | 167,810 | 73,121 |
Gross Profit | 53,871 | 52,256 | 240,870 | 51,325 |
Operating Expenses | ||||
Professional fees | 490,717 | 1,074,065 | 1,713,758 | 3,871,843 |
General and Administrative Expenses | 288,098 | 120,143 | 1,641,838 | 1,239,163 |
Total Operating Expenses | 778,815 | 1,194,208 | 3,355,596 | 5,111,006 |
Loss from Operations | (724,944) | (1,141,952) | (3,114,726) | (5,059,681) |
Other (Income) and Expenses | ||||
Change in Fair Value of Digital Currency | 0 | (8,865) | (200,000) | 11,022 |
Impairment of Digital Currency | 30,169 | 0 | 30,169 | 0 |
Other Income | 0 | 0 | 0 | (18,620) |
Loss On Debt Settlement | 0 | 0 | 0 | 36,697 |
Interest Expense | 0 | 0 | 0 | 11,880 |
Total Other (Income) and Expense | 30,169 | (8,865) | (169,831) | 40,979 |
Loss Before Income Taxes | (755,113) | (1,133,087) | (2,944,895) | (5,100,660) |
Income Taxes | 0 | 0 | 0 | 0 |
Net Loss for the Period | (755,113) | (1,133,087) | (2,944,895) | (5,100,660) |
Loss Attributable to Non-Controlling Interest | (310,525) | (72,940) | (151,314) | (112,698) |
Net Loss for the Period Attributable To Cannabis Sativa, Inc. | $ (444,588) | $ (1,060,147) | $ (2,793,581) | $ (4,987,962) |
Net Loss for the Period per Common Share: | ||||
Basic & Diluted | $ (0.02) | $ (0.05) | $ (0.13) | $ (0.26) |
Weighted Average Common Shares Outstanding: | ||||
Basic & Diluted | 20,892,220 | 19,764,630 | 20,937,541 | 19,547,119 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net Loss for the Period | $ (2,944,895) | $ (5,100,660) |
Adjustments to Reconcile Net Loss for the Period to Net Cash Used in Operating Activities: | ||
Bad Debts | 0 | 1,000 |
Change in Accounting Method for Digital Currency | 11,022 | 0 |
Impairment of Digital Currency | 30,169 | 0 |
Change in Fair Value/Realized Gain of Digital Currency | (200,000) | 11,022 |
Depreciation and Amortization | 421,843 | 323,838 |
Stock Issued and to be Issued for Services | 2,096,860 | 4,034,930 |
Amortization of Stock Based Prepaids, Net | 75,055 | 0 |
Imputed Interest on Loans | 0 | 5,649 |
Changes in assets and liabilities: | ||
Accounts Receivable | (974) | 115 |
Inventories | 272 | (158) |
Prepaid Consulting and Other Current Assets | (46,005) | (70,171) |
Accounts Payable and Accrued Expenses | (10,820) | 155,497 |
Commitments and Contingencies | 0 | (19,000) |
Net Cash Used in Operating Activities: | (567,473) | (657,938) |
Cash Flows from Investing Activities: | ||
Purchase of Fixed Assets | (897) | (5,695) |
Cash Acquired in Merger | 0 | 8,714 |
Cash Purchase of Investment - Shona Banda | 0 | (3,980) |
Purchase of Intangibles | 0 | (150,000) |
Advances to Related Parties | 0 | (742) |
Net Cash Used In Investing Activities: | (897) | (151,703) |
Cash Flows from Financing Activities: | ||
Cash Proceeds from Sale of Stock | 0 | 415,136 |
Proceeds Received from Sales of Common Stock and Warrant Exercises | 361,750 | 356,100 |
Proceeds from Related Parties, Net | 253,530 | 914 |
Net Cash Provided by Financing Activities: | 615,280 | 772,150 |
NET CHANGE IN CASH | 46,910 | (37,491) |
Cash - Beginning of Period | 175,857 | 257,746 |
Cash - End of Period | 222,767 | 220,255 |
Supplemental Disclosures of Non Cash Activities: | ||
Fair Value of Conversion of Amounts Due to Related Party and Accrued Interest | 0 | 100,086 |
Purchase of Investment with Digital Currency | 200,000 | 0 |
Common Stock Issued from Stock Payable | 1,534,835 | 379,900 |
Fair Value of Shares Issued for Intangibles | 0 | 60,100 |
Fair Value of Shares and NCI Issued for Purchase of Presto Corp | 0 | 5,463,202 |
Fair Value of Shares Issued for Services in Prepaid Expenses | 0 | 1,000,000 |
Rescinded Transaction & Elimination of Prepaid Expense | $ 639,822 | 0 |
Adjustment to Purchase Price of iBudtender | $ 163,386 |
1. Organization and Summary of
1. Organization and Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2018 | |
Notes | |
1. Organization and Summary of Significant Accounting Policies | CANNABIS SATIVA, INC. NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS For the Three and Nine Months Ended September 30, 2018 and 2017 Use of Estimates: The preparation of these condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Such management estimates include the valuation of digital currency, valuation of intangible assets in connection with business combinations, recoverability of long-lived assets and goodwill, and the valuation of equity-based instruments. Actual results could differ from those estimates. Liquidity Our operations have been financed primarily through proceeds from notes payable, convertible notes payable, sale of common stock, warrants exercised for common stock and revenue generated from sales of our products. These funds have provided us with the resources to operate our business, sell and support our products, attract and retain key personnel and add new products to our portfolio. We have experienced net losses and negative cash flows from operations each year since our inception. As of September 30, 2018, we had an accumulated deficit of approximately $70,000,000 and negative working capital. We have raised funds through the issuance of debt and the sale of common stock. We have also issued equity instruments in certain circumstances to pay for services from vendors and consultants. During the nine months ended September 30, 2018, approximately $362,000 was raised in gross proceeds from the issuance of common stock from the exercise of warrants. Segment Information: We operate our business on the basis of a single reportable segment, which is the business of delivering products and services ancillary to the medical cannabis market. Our chief operating decision-maker is the Chief Executive Officer, who evaluates us as a single operating segment. Accounts Receivable: We estimate credit loss reserves for accounts receivable on an individual receivable basis. A specific impairment allowance reserve is established based on expected future cash flows and the financial condition of the debtor. We charge off customer balances in part or in full when it is more likely than not that we will not collect that amount of the balance due. We consider any balance unpaid after the contract payment period to be past due. At September 30, 2018 and December 31, 2017 the Company has established an allowance for doubtful accounts of $-0- and $1,246, respectively. Inventory: Inventory cost includes those costs directly attributable to the product before sale. Inventory consists of salves, ointments, lotions, creams and balms and is carried at the lower of cost or (net realizable value), using first-in, first-out method of determining cost. As of September 30, 2018, the Company had $7,992 in raw materials and $247 in finished goods inventory. At December 31, 2017 there was $8,346 in raw materials and $165 in finished goods inventory. CANNABIS SATIVA, INC. NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS For the Three and Nine Months Ended September 30, 2018 and 2017 Fair Value of Financial Instruments: The estimated fair values for financial instruments are determined at discrete points in time based on relevant market information. These estimates involve uncertainties and cannot be determined with precision. The carrying amounts of accounts receivable, accounts payable, accrued liabilities, and notes payable approximate fair value given their short term nature or effective interest rates. Net Loss per Share: Net loss per share is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding for the period and contains no dilutive securities. Diluted earnings per share reflect the potential dilution of securities that could share in the earnings of an entity. Potentially dilutive shares are excluded from the calculation of diluted net loss per share because the effect is anti-dilutive. Revenue Recognition: The Company recognizes revenue from product sales or services rendered when the following five revenue recognition criteria are met: identify the contract with the client, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to performance obligations in the contract and recognize revenues when or as the Company satisfies a performance obligation. For the three and nine months ended September 30, 2018, approximately 95% of the revenue is from PrestoCorp operations. Digital Currencies Translations and Re-measurements Digital currencies are included in current assets in the consolidated balance sheets. As the digital currencies are not financial assets and they lack physical substance, such assets meet the definition of an intangible asset. Accordingly, the Company records the assets at cost less impairment. Realized gain (loss) on sale of digital currencies is included in other income (expense) in the consolidated statements of operations. During the nine months ended September 30, 2018, the Company purchased 10,000,000 shares of common stock of Medical Cannabis Payment Solutions (ticker: REFG) in exchange for 1,000,000 units of Weed coins (valued at $200,000). Investments Investments are stated at cost, and consist of minority ownership in cannabis related companies. Intangible Assets: Intangible assets are comprised of patents, trademarks, the Company’s “CBDS.com” website domain and intellectual property rights. The patents are being amortized using the straight-line method over its economic life, which is estimated to be ten (10) years. The trademarks are being amortized between 5 and 10 years. The CBDS.com website is being amortized using the straight-line method over its economic life, which is estimated to be five (5) years. The intellectual property rights are being amortized using the straight-line month over its economic life, which are estimated to be between three (3) and five (5) years. CANNABIS SATIVA, INC. NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS For the Three and Nine Months Ended September 30, 2018 and 2017 Long-Lived Assets: We review our long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. We evaluate assets for potential impairment by comparing estimated future undiscounted net cash flows to the carrying amount of the assets. If the carrying amount of the assets exceeds the estimated future undiscounted cash flows, impairment is measured based on the difference between the carrying amount of the assets and fair value. Assets to be disposed of would be separately presented in the consolidated balance sheet and reported at the lower of the carrying amount or fair value less costs to sell and are no longer depreciated. The assets and liabilities of a disposal group classified as held-for-sale would be presented separately in the appropriate asset and liability sections of the consolidated balance sheet, if material. During the three and nine months ended September 30, 2018 we did not recognize any impairment of our long-lived assets. Stock-Based Compensation: Stock-based compensation is computed in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 718. FASB ASC 718 requires all share-based payment to employees, including grants of employee stock options, to be recognized as compensation expense in the consolidated financial statements based on their fair values. That expense will be recognized over the period during which an employee is required to provide services in exchange for the award, known as the requisite service period (usually the vesting period). The Company has selected the Black-Scholes option pricing model as the most appropriate fair value method for our awards and have recognized compensation costs immediately as our awards are 100% vested. The Company’s accounting policy for equity instruments issued to consultants and vendors in exchange for goods and services follows the provisions of FASB ASC 505-50. The measurement date for the fair value of the equity instruments issued is determined at the earlier of (i) the date at which a commitment for performance by the consultant or vendor is reached or (ii) the date at which the consultant or vendor’s performance is complete. In the case of equity instruments issued to consultants, the fair value of the equity instrument is recognized over the term of the consulting agreement. Stock-based compensation related to non-employees is accounted for based on the fair value of the related stock or options or the fair value of the services, whichever is more readily determinable in accordance with ASC 718. Advertising Expense: Advertising costs are expensed as incurred and are included in general and administrative expense in the accompanying consolidated statements of operations. Advertising costs were approximately $54,170 and $172,000 for the nine months ended September 30, 2018 and 2017, respectively. Business Combinations: We account for business combinations by recognizing the assets acquired, liabilities assumed, contractual contingencies, and contingent consideration at their fair values on the acquisition date. The final purchase price may be adjusted up to one year from the date of the acquisition. Identifying the fair value of the tangible and intangible assets and liabilities acquired requires the use of estimates by management and was based upon currently available data. Examples of critical estimates in valuing certain of the intangible assets we have acquired or may acquire in the future include but are not limited to future expected cash flows from product sales, support agreements, consulting contracts, other customer contracts, and acquired developed technologies and patents and discount rates utilized in valuation estimates. reduction to revenues in 2018. For changes in credit issues not assessed at the date of service, the Company will prospectively recognize those amounts in operating expenses on the consolidated statements of income. CANNABIS SATIVA, INC. NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS For the Three and Nine Months Ended September 30, 2018 and 2017 The Company operates as one reportable segment. The Company receives payments from individual clients. As the period between the time of service and time of payment is typically one day or less if it is an internet sale otherwise payment can be up to 30 days, the Company elected the practical expedient under ASC 606-10-32-18 and did not adjust for the effects of a significant financing component. Under the new revenue standard, the Company has elected to apply the following practical expedients and optional exemptions: In February 2016, the FASB issued ASU 2016-02, Leases. The standard requires lessees to recognize lease assets and lease liabilities on the consolidated balance sheet and requires expanded disclosures about leasing arrangements. We plan to adopt the standard on January 1, 2019. We are currently assessing the impact that the new standard will have on our consolidated financial statements, which will consist primarily of a balance sheet gross up of our operating leases to show equal and offsetting lease assets and lease liabilities. In June 2018, the FASB issued ASU 2018-07, Compensation - Stock Compensation (Topic 718) Compensation - Stock Compensation (Topic 718) FASB ASU 2017-11 “ Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480) and Derivatives and Hedging (Topic 815) |
2. Eden Holdings Llc
2. Eden Holdings Llc | 9 Months Ended |
Sep. 30, 2018 | |
Notes | |
2. Eden Holdings Llc | 2. Eden Holdings LLC During the quarter ended September 30, 2014, the Company created Eden Holdings LLC, (the “LLC”). The purpose of the LLC is to hold the intellectual property of Cannabis Sativa, Inc. As of September 30, 2018 and December 31, 2017 there has been no activity in the LLC. |
3. Fair Value Measurements
3. Fair Value Measurements | 9 Months Ended |
Sep. 30, 2018 | |
Notes | |
3. Fair Value Measurements | 3. Fair Value Measurements We adopted ASC Topic 820 for financial instruments measured at fair value on a recurring basis. ASC Topic 820 defines fair value, establishes a framework for measuring fair value in accordance with accounting principles generally accepted in the United States and expands disclosures about fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC Topic 820 establishes a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include: · Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets; · Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and · Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. The estimated fair values for financial instruments are determined at discrete points in time based on relevant market information. These estimates involve uncertainties and cannot be determined with precision. The carrying amounts of accounts receivable, inventory, notes payable, accounts payable, accrued liabilities approximate fair value given their short-term nature or effective interest rates. We measure certain financial instruments at fair value on a recurring basis. |
4. Fixed Assets
4. Fixed Assets | 9 Months Ended |
Sep. 30, 2018 | |
Notes | |
4. Fixed Assets | 4. Fixed Assets Property and equipment consisted Unaudited September 30, December 31, 2018 2017 Furniture and Equipment $ 18,322 $ 17,425 Leasehold Improvements 2,500 2,500 20,822 19,925 Less: Accumulated Depreciation (11,948) (9,325) Net Property and Equipment $ 8,874 $ 10,600 Depreciation expense for the nine months ended September 30, 2018 and 2017 was approximately $2,600 and $1,000, respectively. |
5. Intangibles
5. Intangibles | 9 Months Ended |
Sep. 30, 2018 | |
Notes | |
5. Intangibles | 5. Intangibles Intangibles consisted Unaudited September 30, December 31, 2018 2017 CBDS.com website (Cannabis Sativa) $ 13,999 $ 13,999 Intellectual Property Rights (Cannabis Sativa) 1,484,250 1,484,250 Intellectual Property Rights Vaporpenz (Cannabis Sativa) 210,100 210,100 Intellectual Property Rights (iBudtender) 330,000 330,000 Intellectual Property Rights (PrestoCorp) 240,000 240,000 Patents and Trademarks (Cannabis Sativa) 8,410 8,410 Patents and Trademarks (Wild Earth) 4,425 4,425 Patents and Trademarks (KPAL) 1,410,000 1,410,000 3,701,184 3,701,184 Less: Accumulated Amortization (1,267,345) (848,125) Net Intangible Assets $ 2,433,839 $ 2,853,059 Amortization expense for the nine months ended September 30, 2018 and 2017 was approximately $419,000 and $323,000, respectively. Amortization for each of the next 5 years approximates: 2019 $558,000 2020 $558,000 2021 $526,000 2022 $422,000 2023 $384,000 Goodwill consisted of the following at September 30, 2018 and December 31, 2017: Unaudited September 30, 2018 December 31, 2017 Beginning Balance $ 3,346,869 $ 247,051 Acquisition PrestoCorp (1) - 3,010,202 Adjustment to Valuation of iBudtender Acquisition - 89,616 Ending Balance $ 3,346,869 $ 3,346,869 |
6. Related Parties
6. Related Parties | 9 Months Ended |
Sep. 30, 2018 | |
Notes | |
6. Related Parties | 6. Related Parties The Company has received advances from related parties and officers of the Company to cover operating expenses. As of September 30, 2018 and December 31, 2017, net amounts due to the related parties were $876,623 and $623,093, respectively. During the nine months ended September 30, 2018 and 2017, the Company has imputed interest on these advances at the rates between 5% and 8% per annum and has recorded interest expense related to these balances in the amount of $-0- and $11,880 respectively. Because the related parties do not expect the imputed interest to be repaid, the interest has been recorded as a contribution of capital. At September 30, 2018 and December 31, 2017, the Company had a note payable to the founder of iBudtender of $8,744 and $55,667, respectively. This note is included in due to related parties on the condensed consolidated balance sheets. The note earns interest at 0% and is due on demand. During the nine months ended September 30, 2018 and 2017, the Company incurred approximately $33,000 and $15,000, respectively, for consulting services from a relative of the Company’s president. |
7. Stockholders' Equity
7. Stockholders' Equity | 9 Months Ended |
Sep. 30, 2018 | |
Notes | |
7. Stockholders' Equity | As of December 31, 2017, the Company had outstanding warrants to purchase 230,775 shares of the Company’s common stock. The exercise price of the warrants was $2.00 per share. All warrants are exercisable and expire on January 31, 2020. CANNABIS SATIVA, INC. NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS For the Three and Nine Months Ended September 30, 2018 and 2017 During the nine months ended September 30, 2018, the board of directors approved the issuance of 429,475 shares of common stock for services in the amount of approximately $1,723,784 of which approximately $1,535,000 was recorded through stock payable and approximately $189,000 were shares for services expensed upon issuance. The fair value of the shares issued was based on the market price of the Company’s common stock on the respective measurement dates. During the nine months ended September 30, 2018, 100,875 shares common stock were issued in connection with the exercise of warrants for approximately $202,000 in cash. At September 30, 2018 a total of 129,900 warrants remain outstanding. During the nine months ended September 30, 2018, 332,447 shares common stock were returned in connection with a previous issuance of stock for services due to the non-performance of the vendor. The total value of the transaction in the amount of $990,692 was reversed with $103,197 reported as income in the statement of operations reducing general and administrative income since the vendor never performed and this amount represented the amount that was expensed in the prior period. During the nine months ended September 30, 2018, 95,000 shares of common stock, both issued and to be issued, were returned in connection with an amended investment agreement with iBudtender. The total value of the transaction in the amount of $50 was removed from common stock. |
8. Purchase of PrestoCorp
8. Purchase of PrestoCorp | 9 Months Ended |
Sep. 30, 2018 | |
Notes | |
8. Purchase of PrestoCorp | 8. Purchase of PrestoCorp Effective August 1, 2017, the Company purchased 51% voting interest in PrestoCorp. The Company can issue PrestoCorp up to 1,027,169 shares of common stock valued at approximately $3,500,000 on the closing date of the transaction. In exchange, PrestoCorp issued 2,550 shares of its common stock to the Company. The purchase price includes an earn-out based on future performance of PrestoCorp if certain revenue and income milestones are achieved, which under ASC 805 are considered compensatory in nature and have been excluded from the purchase price allocation below. The following summarizes the transaction with PrestoCorp at closing on August 1, 2017: Cash $ 8,713 Prepaid Assets 8,565 Property & Equipment, Net 8,702 Intellectual Property 810,000 Goodwill 3,519,202 Total Assets $ 4,355,182 Accounts Payable & Accrued Expenses (20,507) Fair value of NCI (1,996,000) Due to – Related Parties (5,473) Net Purchase (fair value of common stock issued) $ 2,333,202 September 30, 2017 Revenues $ 680,000 Expenses (5,040,000) Net Loss for the Period $ (4,360,000) The following table sets forth the components of identified intangible assets associated with the acquisition. Fair Value at Acquisition Technology: Website & App $ 520,000 Marketing related 260,000 Customer base 30,000 $ 810,000 Subsequent to acquisition, the Company realized an impairment expense related to the PrestoCorp intangible assets of approximately $472,000 due to the greater-than-expected impact from recreational cannabis legalization in CA and NV, as well as longer cycle times to open new markets. |
9. Going Concern Considerations
9. Going Concern Considerations | 9 Months Ended |
Sep. 30, 2018 | |
Notes | |
9. Going Concern Considerations | 9. Going Concern Considerations The accompanying condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As shown in the accompanying condensed consolidated financial statements, the Company has negative working capital, has incurred operating losses since inception, and has not yet produced significant continuing revenues from operations. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might be necessary in the event that the Company cannot continue as a going concern. Management anticipates that it will be able to raise additional working capital through the issuance of stock and through additional loans from investors. CANNABIS SATIVA, INC. NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS For the Three and Nine Months Ended September 30, 2018 and 2017 The ability of the Company to continue as a going concern is dependent on its ability to raise adequate capital to fund operating losses until it is able to engage in profitable business operations. To the extent financing is not available, the Company may not be able to, or may be delayed in, developing its services and meeting its obligations. The Company will continue to evaluate its projected expenditures relative to its available cash and to evaluate additional means of financing in order to satisfy its working capital and other cash requirements. The accompanying condensed consolidated financial statements do not reflect any adjustments that might result from the outcome of these uncertainties. |
10. Commitments and Contingenci
10. Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2018 | |
Notes | |
10. Commitments and Contingencies | As of September 30, 2018 and December 31, 2017 the Company recorded approximately $1,301,000 and $768,000, respectively, of stock payable related to common stock to be issued. The following summary approximates the activity of stock payable during the nine months ended September 30, 2018: Beginning Balance – January 1, 2018 $ 767,603 Additions 2,067,981 Issuances (1,534,855) Ending Balance – September 30, 2018 $ 1,300,729 In connection with the one year anniversary of PrestoCorp acquisition, included in stock payable is approximately $541,000 due to PrestoCorp as per their original purchase agreement which stated that “"In the event that the 30-day average price per share of the CBDS common stock is less than the Closing Price Per Share on the first anniversary of Closing, CBDS shall promptly issue to the Sellers contingent value right shares equal to the difference between Closing Price Per Share and the 30-day average price per share of CBDS common stock immediately prior to such date, multiplied by the number of Initial Shares.” The Company has accrued approximately $541,000 as of September 30, 2018 for this liability to the sellers. The value of these shares has been expensed as compensation during the nine months ended September 30, 2018. CANNABIS SATIVA, INC. NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS For the Three and Nine Months Ended September 30, 2018 and 2017 Indemnities The Company’s Articles of Incorporation and bylaws require us, among other things, to indemnify the director or officer against specified expenses and liabilities, such as attorneys’ fees, judgments, fines and settlements, paid by the individual in connection with any action, suit or proceeding arising out of the individual’s status or service as our director or officer, other than liabilities arising from willful misconduct or conduct that is knowingly fraudulent or deliberately dishonest, and to advance expenses incurred by the individual in connection with any proceeding against the individual with respect to which the individual may be entitled to indemnification by us. We also indemnify our lessor in connection with our facility lease for certain claims arising from the use of the facilities. These indemnities do not provide for any limitation of the maximum potential future payments we could be obligated to make. Historically, we have not incurred any payments for these obligations and, therefore, no liabilities have been recorded for these indemnities in the accompanying condensed consolidated balance sheets. The Company carries “side A” insurance coverage $2 million for this exposure. |
11. Subsequent Events
11. Subsequent Events | 9 Months Ended |
Sep. 30, 2018 | |
Notes | |
11. Subsequent Events | 11. Subsequent Events In October 2018, the Company issued 80,986 shares of common stock to consultants and officers for services rendered during the three months ended September 30, 2018. In October 2018, the Company issued 80,000 shares of common stock in connection with the exercise of warrants for approximately $160,000 in cash. In October 2018 the Company issued 204,097 shares of common stock in connection with compensation agreements for PrestoCorp personnel. We have evaluated subsequent events through the filing of this Form 10-Q and determined that no subsequent events have occurred that would require recognition in the condensed consolidated financial statements or disclosures in the notes thereto, other than as disclosed above. |
1. Organization and Summary o_2
1. Organization and Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Policies | |
Basis of Presentation | Basis of Presentation: The accompanying condensed consolidated balance sheet at December 31, 2017, has been derived from audited consolidated financial statements and the unaudited condensed consolidated financial statements as of September 30, 2018 and 2017, have been prepared in accordance with generally accepted accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements, and should be read in conjunction with the audited consolidated financial statements and related footnotes included in our Annual report on Form 10-K for the year ended December 31, 2017 (the “2017 Annual Report”), filed with the Securities and Exchange Commission (the “SEC”). It is management’s opinion, however, that all material adjustments (consisting of normal recurring adjustments), have been made which are necessary for a fair financial statements presentation. The condensed consolidated financial statements include all material adjustments (consisting of normal recurring accruals) necessary to make the condensed consolidated financial statements not misleading as required by Regulation S-X, Rule 10-01. Operating results for the three and nine months ended September 30, 2018, are not necessarily indicative of the results of operations expected for the year ending December 31, 2018. |
Principles of Consolidation | Principles of Consolidation: The condensed consolidated financial statements include the accounts of Cannabis Sativa, Inc., and its wholly-owned subsidiaries; Wild Earth Naturals, Inc., Hi-Brands International, Inc., Eden Holdings LLC, our 50.1% ownership of iBudtender Inc. and our 51% ownership of PrestoCorp, (collectively referred to as the “Company”). All significant inter-company balances have been eliminated in consolidation. |
Method of Accounting | Method of Accounting: The Company maintains its books and prepares its consolidated financial statements on the accrual basis of accounting. During the period ended September 30, 2018 the Company changed its method of accounting for its digital currency from Available for Sale to Held for Investment. At this change it was determined that the digital currency was worthless so the total cost was impaired. The Unrealized gain on the digital currency that was included in Accumulated Other Comprehensive Income of $11,022 was then expensed to General and Administrative Expenses. |
Use of Estimates | Use of Estimates: The preparation of these condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Such management estimates include the valuation of digital currency, valuation of intangible assets in connection with business combinations, recoverability of long-lived assets and goodwill, and the valuation of equity-based instruments. Actual results could differ from those estimates. |
Liquidity | Liquidity Our operations have been financed primarily through proceeds from notes payable, convertible notes payable, sale of common stock, warrants exercised for common stock and revenue generated from sales of our products. These funds have provided us with the resources to operate our business, sell and support our products, attract and retain key personnel and add new products to our portfolio. We have experienced net losses and negative cash flows from operations each year since our inception. As of September 30, 2018, we had an accumulated deficit of approximately $70,000,000 and negative working capital. We have raised funds through the issuance of debt and the sale of common stock. We have also issued equity instruments in certain circumstances to pay for services from vendors and consultants. During the nine months ended September 30, 2018, approximately $362,000 was raised in gross proceeds from the issuance of common stock from the exercise of warrants. |
Segment Information | Segment Information: We operate our business on the basis of a single reportable segment, which is the business of delivering products and services ancillary to the medical cannabis market. Our chief operating decision-maker is the Chief Executive Officer, who evaluates us as a single operating segment. |
Accounts Receivable | Accounts Receivable: We estimate credit loss reserves for accounts receivable on an individual receivable basis. A specific impairment allowance reserve is established based on expected future cash flows and the financial condition of the debtor. We charge off customer balances in part or in full when it is more likely than not that we will not collect that amount of the balance due. We consider any balance unpaid after the contract payment period to be past due. At September 30, 2018 and December 31, 2017 the Company has established an allowance for doubtful accounts of $-0- and $1,246, respectively. |
Inventory | Inventory: Inventory cost includes those costs directly attributable to the product before sale. Inventory consists of salves, ointments, lotions, creams and balms and is carried at the lower of cost or (net realizable value), using first-in, first-out method of determining cost. As of September 30, 2018, the Company had $7,992 in raw materials and $247 in finished goods inventory. At December 31, 2017 there was $8,346 in raw materials and $165 in finished goods inventory. |
Fair Value of Financial Instruments: | Fair Value of Financial Instruments: The estimated fair values for financial instruments are determined at discrete points in time based on relevant market information. These estimates involve uncertainties and cannot be determined with precision. The carrying amounts of accounts receivable, accounts payable, accrued liabilities, and notes payable approximate fair value given their short term nature or effective interest rates. |
Net Loss per Share: | Net Loss per Share: Net loss per share is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding for the period and contains no dilutive securities. Diluted earnings per share reflect the potential dilution of securities that could share in the earnings of an entity. Potentially dilutive shares are excluded from the calculation of diluted net loss per share because the effect is anti-dilutive. |
Revenue Recognition: | Revenue Recognition: The Company recognizes revenue from product sales or services rendered when the following five revenue recognition criteria are met: identify the contract with the client, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to performance obligations in the contract and recognize revenues when or as the Company satisfies a performance obligation. For the three and nine months ended September 30, 2018, approximately 95% of the revenue is from PrestoCorp operations. |
Digital Currencies Translations and Re-measurements | Digital Currencies Translations and Re-measurements Digital currencies are included in current assets in the consolidated balance sheets. As the digital currencies are not financial assets and they lack physical substance, such assets meet the definition of an intangible asset. Accordingly, the Company records the assets at cost less impairment. Realized gain (loss) on sale of digital currencies is included in other income (expense) in the consolidated statements of operations. During the nine months ended September 30, 2018, the Company purchased 10,000,000 shares of common stock of Medical Cannabis Payment Solutions (ticker: REFG) in exchange for 1,000,000 units of Weed coins (valued at $200,000). |
Investments | Investments Investments are stated at cost, and consist of minority ownership in cannabis related companies. |
Intangible Assets: | Intangible Assets: Intangible assets are comprised of patents, trademarks, the Company’s “CBDS.com” website domain and intellectual property rights. The patents are being amortized using the straight-line method over its economic life, which is estimated to be ten (10) years. The trademarks are being amortized between 5 and 10 years. The CBDS.com website is being amortized using the straight-line method over its economic life, which is estimated to be five (5) years. The intellectual property rights are being amortized using the straight-line month over its economic life, which are estimated to be between three (3) and five (5) years. |
Long-Lived Assets | Long-Lived Assets: We review our long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. We evaluate assets for potential impairment by comparing estimated future undiscounted net cash flows to the carrying amount of the assets. If the carrying amount of the assets exceeds the estimated future undiscounted cash flows, impairment is measured based on the difference between the carrying amount of the assets and fair value. Assets to be disposed of would be separately presented in the consolidated balance sheet and reported at the lower of the carrying amount or fair value less costs to sell and are no longer depreciated. The assets and liabilities of a disposal group classified as held-for-sale would be presented separately in the appropriate asset and liability sections of the consolidated balance sheet, if material. During the three and nine months ended September 30, 2018 we did not recognize any impairment of our long-lived assets. |
Stock-Based Compensation | Stock-Based Compensation: Stock-based compensation is computed in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 718. FASB ASC 718 requires all share-based payment to employees, including grants of employee stock options, to be recognized as compensation expense in the consolidated financial statements based on their fair values. That expense will be recognized over the period during which an employee is required to provide services in exchange for the award, known as the requisite service period (usually the vesting period). The Company has selected the Black-Scholes option pricing model as the most appropriate fair value method for our awards and have recognized compensation costs immediately as our awards are 100% vested. The Company’s accounting policy for equity instruments issued to consultants and vendors in exchange for goods and services follows the provisions of FASB ASC 505-50. The measurement date for the fair value of the equity instruments issued is determined at the earlier of (i) the date at which a commitment for performance by the consultant or vendor is reached or (ii) the date at which the consultant or vendor’s performance is complete. In the case of equity instruments issued to consultants, the fair value of the equity instrument is recognized over the term of the consulting agreement. Stock-based compensation related to non-employees is accounted for based on the fair value of the related stock or options or the fair value of the services, whichever is more readily determinable in accordance with ASC 718. |
Advertising Expense | Advertising Expense: Advertising costs are expensed as incurred and are included in general and administrative expense in the accompanying consolidated statements of operations. Advertising costs were approximately $54,170 and $172,000 for the nine months ended September 30, 2018 and 2017, respectively. |
Business Combinations | Business Combinations: We account for business combinations by recognizing the assets acquired, liabilities assumed, contractual contingencies, and contingent consideration at their fair values on the acquisition date. The final purchase price may be adjusted up to one year from the date of the acquisition. Identifying the fair value of the tangible and intangible assets and liabilities acquired requires the use of estimates by management and was based upon currently available data. Examples of critical estimates in valuing certain of the intangible assets we have acquired or may acquire in the future include but are not limited to future expected cash flows from product sales, support agreements, consulting contracts, other customer contracts, and acquired developed technologies and patents and discount rates utilized in valuation estimates. CANNABIS SATIVA, INC. NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS For the Three and Nine Months Ended September 30, 2018 and 2017 Unanticipated events and circumstances may occur that may affect the accuracy or validity of such assumptions, estimates or actual results. Additionally, any change in the fair value of the acquisition-related contingent consideration subsequent to the acquisition date, including changes from events after the acquisition date, such as changes in our estimate of relevant revenue or other targets, will be recognized in earnings in the period of the estimated fair value change. A change in fair value of the acquisition-related contingent consideration or the occurrence of events that cause results to differ from our estimates or assumptions could have a material effect on the consolidated statements of operations, financial position and cash flows in the period of the change in the estimate. |
Correction of Error | Correction of Error Company management has determined, after discussion with our independent registered public accounting firm, the Company’s digital currency were not properly accounted for and the amounts previously reported were misstated. Based on our analysis, the Company has concluded that it erroneously recorded its digital currencies at fair value in the prior year and previous quarters rather than at cost, less impairment. Accordingly, the digital currency asset has been stated at zero value, which resents the cost basis, and the related decrease in valuation of approximately $30,000 was recorded as an impairment in the current period. The prior year balance of approximately $230,000 and the prior periods unrealized gain/loss have not been restated, as such amounts are determined not to be significant to the Company’s overall financial statements as such amounts represent less than 3% of assets and less than 1% of net loss. |
Pending Accounting Pronouncements: | At the adoption of Topic 606, the majority of what was previously classified as the provision for bad debts in the consolidated statements of income is now reflected as implicit price concessions and, therefore, included as a reduction to revenues in 2018. For changes in credit issues not assessed at the date of service, the Company will prospectively recognize those amounts in operating expenses on the consolidated statements of income. CANNABIS SATIVA, INC. NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS For the Three and Nine Months Ended September 30, 2018 and 2017 The Company operates as one reportable segment. The Company receives payments from individual clients. As the period between the time of service and time of payment is typically one day or less if it is an internet sale otherwise payment can be up to 30 days, the Company elected the practical expedient under ASC 606-10-32-18 and did not adjust for the effects of a significant financing component. Under the new revenue standard, the Company has elected to apply the following practical expedients and optional exemptions: In February 2016, the FASB issued ASU 2016-02, Leases. The standard requires lessees to recognize lease assets and lease liabilities on the consolidated balance sheet and requires expanded disclosures about leasing arrangements. We plan to adopt the standard on January 1, 2019. We are currently assessing the impact that the new standard will have on our consolidated financial statements, which will consist primarily of a balance sheet gross up of our operating leases to show equal and offsetting lease assets and lease liabilities. In June 2018, the FASB issued ASU 2018-07, Compensation - Stock Compensation (Topic 718) Compensation - Stock Compensation (Topic 718) FASB ASU 2017-11 “ Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480) and Derivatives and Hedging (Topic 815) |
4. Fixed Assets (Tables)
4. Fixed Assets (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Tables/Schedules | |
Schedule of Property and Equipment | Property and equipment consisted Unaudited September 30, December 31, 2018 2017 Furniture and Equipment $ 18,322 $ 17,425 Leasehold Improvements 2,500 2,500 20,822 19,925 Less: Accumulated Depreciation (11,948) (9,325) Net Property and Equipment $ 8,874 $ 10,600 |
5. Intangibles (Tables)
5. Intangibles (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Tables/Schedules | |
Schedule of Intangible Assets | Intangibles consisted Unaudited September 30, December 31, 2018 2017 CBDS.com website (Cannabis Sativa) $ 13,999 $ 13,999 Intellectual Property Rights (Cannabis Sativa) 1,484,250 1,484,250 Intellectual Property Rights Vaporpenz (Cannabis Sativa) 210,100 210,100 Intellectual Property Rights (iBudtender) 330,000 330,000 Intellectual Property Rights (PrestoCorp) 240,000 240,000 Patents and Trademarks (Cannabis Sativa) 8,410 8,410 Patents and Trademarks (Wild Earth) 4,425 4,425 Patents and Trademarks (KPAL) 1,410,000 1,410,000 3,701,184 3,701,184 Less: Accumulated Amortization (1,267,345) (848,125) Net Intangible Assets $ 2,433,839 $ 2,853,059 |
Goodwill | Goodwill consisted of the following at September 30, 2018 and December 31, 2017: Unaudited September 30, 2018 December 31, 2017 Beginning Balance $ 3,346,869 $ 247,051 Acquisition PrestoCorp (1) - 3,010,202 Adjustment to Valuation of iBudtender Acquisition - 89,616 Ending Balance $ 3,346,869 $ 3,346,869 |
8. Purchase of PrestoCorp (Tabl
8. Purchase of PrestoCorp (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Schedule of Business Acquisitions, PrestoCorp | The following summarizes the transaction with PrestoCorp at closing on August 1, 2017: Cash $ 8,713 Prepaid Assets 8,565 Property & Equipment, Net 8,702 Intellectual Property 810,000 Goodwill 3,519,202 Total Assets $ 4,355,182 Accounts Payable & Accrued Expenses (20,507) Fair value of NCI (1,996,000) Due to – Related Parties (5,473) Net Purchase (fair value of common stock issued) $ 2,333,202 |
Schedule of Finite-Lived Intangible Assets Acquired, PrestoCorp | The following table sets forth the components of identified intangible assets associated with the acquisition. Fair Value at Acquisition Technology: Website & App $ 520,000 Marketing related 260,000 Customer base 30,000 $ 810,000 |
Prestocorp | |
Pro Forma Information, Acquisition | September 30, 2017 Revenues $ 680,000 Expenses (5,040,000) Net Loss for the Period $ (4,360,000) |
10. Commitments and Contingen_2
10. Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Tables/Schedules | |
Schedule of stock payable | The following summary approximates the activity of stock payable during the nine months ended September 30, 2018: Beginning Balance – January 1, 2018 $ 767,603 Additions 2,067,981 Issuances (1,534,855) Ending Balance – September 30, 2018 $ 1,300,729 |
1. Organization and Summary o_3
1. Organization and Summary of Significant Accounting Policies: Principles of Consolidation (Details) | Sep. 30, 2018 | Aug. 01, 2017 |
Ibudtender Inc | ||
Equity Method Investment, Ownership Percentage | 50.10% | |
Prestocorp | ||
Equity Method Investment, Ownership Percentage | 51.00% | 51.00% |
1. Organization and Summary o_4
1. Organization and Summary of Significant Accounting Policies: Liquidity (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Proceeds Received from Sales of Common Stock and Warrant Exercises | $ 361,750 | $ 356,100 |
Approximate | ||
Proceeds Received from Sales of Common Stock and Warrant Exercises | $ 362,000 |
1. Organization and Summary o_5
1. Organization and Summary of Significant Accounting Policies: Accounts Receivable (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Details | ||
Allowance for Doubtful Accounts Receivable | $ 0 | $ 1,246 |
1. Organization and Summary o_6
1. Organization and Summary of Significant Accounting Policies: Inventory (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Details | ||
Inventory, Raw Materials | $ 7,992 | $ 8,346 |
Inventory, Finished Goods | $ 247 | $ 165 |
1. Organization and Summary o_7
1. Organization and Summary of Significant Accounting Policies: Revenue Recognition (Details) | 9 Months Ended |
Sep. 30, 2018 | |
Details | |
Concentration Risk, Percentage | 95.00% |
1. Organization and Summary o_8
1. Organization and Summary of Significant Accounting Policies: Digital Currencies Translations and Re-measurements (Details) | 9 Months Ended |
Sep. 30, 2018USD ($)shares | |
REFG | |
Shares purchased | 10,000,000 |
Weed Coin | |
Units sold | 1,000,000 |
Units valued | $ | $ 200,000 |
1. Organization and Summary o_9
1. Organization and Summary of Significant Accounting Policies: Intangible Assets (Details) | 9 Months Ended |
Sep. 30, 2018 | |
Patent | |
Finite-Lived Intangible Asset, Useful Life | 10 years |
Internet Domain Names | |
Finite-Lived Intangible Asset, Useful Life | 5 years |
Intellectual Property | Minimum | |
Finite-Lived Intangible Asset, Useful Life | 3 years |
Intellectual Property | Maximum | |
Finite-Lived Intangible Asset, Useful Life | 5 years |
1. Organization and Summary _10
1. Organization and Summary of Significant Accounting Policies: Advertising Expense (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Details | ||
Advertising Expense | $ 54,170 | $ 172,000 |
4. Fixed Assets_ Schedule of Pr
4. Fixed Assets: Schedule of Property and Equipment (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Less: accumulated depreciation | $ (11,948) | $ (9,325) |
Property and Equipment, Net | 8,874 | 10,600 |
Furniture and Fixtures | ||
Property, Plant and Equipment, Gross | 18,322 | 17,425 |
Leasehold Improvements | ||
Property, Plant and Equipment, Gross | $ 2,500 | $ 2,500 |
4. Fixed Assets (Details)
4. Fixed Assets (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Details | ||
Depreciation | $ 2,600 | $ 1,000 |
5. Intangibles_ Schedule of Int
5. Intangibles: Schedule of Intangible Assets (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Finite-Lived Intangible Assets, Gross | $ 3,701,184 | $ 3,701,184 |
Less: Accumulated Amortization | (1,267,345) | (848,125) |
Finite-Lived Intangible Assets, Net | 2,433,839 | 2,853,059 |
Internet Domain Names | ||
Finite-Lived Intangible Assets, Gross | 13,999 | 13,999 |
Intellectual Property | Cannabis Sativa | ||
Finite-Lived Intangible Assets, Gross | 1,484,250 | 1,484,250 |
Intellectual Property | Vaporpenz | ||
Finite-Lived Intangible Assets, Gross | 210,100 | 210,100 |
Intellectual Property | Ibudtender Inc | ||
Finite-Lived Intangible Assets, Gross | 330,000 | 330,000 |
Intellectual Property | Prestocorp | ||
Finite-Lived Intangible Assets, Gross | 240,000 | 240,000 |
Patents And Trademarks | Cannabis Sativa | ||
Finite-Lived Intangible Assets, Gross | 8,410 | 8,410 |
Patents And Trademarks | Wild Earth | ||
Finite-Lived Intangible Assets, Gross | 4,425 | 4,425 |
Patents And Trademarks | KPAL | ||
Finite-Lived Intangible Assets, Gross | $ 1,410,000 | $ 1,410,000 |
5. Intangibles (Details)
5. Intangibles (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Details | ||
Amortization of Intangible Assets | $ 419,000 | $ 323,000 |
2,019 | 558,000 | |
2,020 | 558,000 | |
2,021 | 526,000 | |
2,022 | 422,000 | |
2,023 | $ 384,000 |
5. Intangibles_ Goodwill (Detai
5. Intangibles: Goodwill (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Goodwill, Beginning Balance | $ 3,346,869 | $ 247,051 |
Goodwill | 3,346,869 | 3,346,869 |
Goodwill, Ending Balance | 3,346,869 | 3,346,869 |
Prestocorp | ||
Goodwill, Beginning Balance | 3,010,202 | |
Goodwill | 0 | 3,010,202 |
Goodwill, Ending Balance | 0 | 3,010,202 |
Ibudtender Inc | ||
Goodwill, Beginning Balance | 89,616 | |
Goodwill | 0 | 89,616 |
Goodwill, Ending Balance | $ 0 | $ 89,616 |
6. Related Parties (Details)
6. Related Parties (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Net advances | $ 876,623 | $ 876,623 | $ 623,093 | ||
Interest Expense | $ 0 | $ 0 | $ 0 | $ 11,880 | |
Ibudtender Inc | |||||
Debt Instrument, Interest Rate, Stated Percentage | 0.00% | 0.00% | |||
Debt Instrument, Face Amount | $ 8,744 | $ 8,744 | $ 55,667 | ||
Investor | |||||
Interest Expense | 0 | 11,880 | |||
Consultant | |||||
Other General and Administrative Expense | $ 33,000 | $ 15,000 | |||
Minimum | |||||
Debt Instrument, Interest Rate, Stated Percentage | 5.00% | 5.00% | |||
Maximum | |||||
Debt Instrument, Interest Rate, Stated Percentage | 8.00% | 8.00% |
7. Stockholders' Equity (Detail
7. Stockholders' Equity (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Preferred Stock, Shares Authorized | 5,000,000 | 5,000,000 | 5,000,000 | ||
Preferred Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 | $ 0.001 | ||
Stock Issued During Period, Value, Other | $ 415,000 | ||||
Gain (Loss) Related to Litigation Settlement | $ 150,000 | ||||
Stock Issued During Period, Shares, Acquisitions | 10,000 | ||||
Shares Issued for Services | $ 1,723,784 | ||||
Amortization of consultung fees | $ 555,000 | ||||
Warrants, Outstanding | 129,900 | 129,900 | 230,775 | ||
Exercise Price of Warrants or Rights | $ 2 | ||||
Stock payable | $ 1,535,000 | $ 1,535,000 | |||
Allocated Share-based Compensation Expense | 189,000 | ||||
Stock Issued During Period, Value, New Issues | 202,000 | ||||
Stock Repurchased and Retired During Period, Value | 990,692 | ||||
General and Administrative Expenses | $ 288,098 | $ 120,143 | 1,641,838 | $ 1,239,163 | |
A Vendor | |||||
General and Administrative Expenses | $ (103,197) | ||||
Prestocorp | |||||
Stock Issued During Period, Value, Acquisitions | $ 2,332,649 | ||||
Ibudtender Inc | |||||
Stock Repurchased and Retired During Period, Shares | 95,000 | ||||
Stock Repurchased and Retired During Period, Value | $ 50 | ||||
Intellectual Property | |||||
Investment Owned, at Cost | 210,100 | ||||
Stock Issued During Period, Value, Acquisitions | 60,100 | ||||
Related Party Note Payable | Principal | |||||
Debt Conversion, Original Debt, Amount | 100,000 | ||||
Related Party Note Payable | Interest | |||||
Debt Conversion, Original Debt, Amount | $ 5,000 | ||||
Preferred Stock | Common Class A | |||||
Preferred Stock, Shares Authorized | 5,000,000 | 5,000,000 | |||
Preferred Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 | |||
Preferred Stock, Voting Rights | 1 vote per share | ||||
Common Stock | |||||
Stock Issued During Period, Shares, Other | 80,000 | ||||
Shares Issued for Services | 429,475 | 1,229,308 | |||
Shares Issued for Services | $ 5,500,000 | ||||
Stock Issued During Period, Shares, New Issues | 100,875 | ||||
Stock Repurchased and Retired During Period, Shares | 332,447 | ||||
Common Stock | Prestocorp | |||||
Stock Issued During Period, Shares, Acquisitions | 564,943 | ||||
Common Stock | Related Party Note Payable | |||||
Debt Conversion, Converted Instrument, Shares Issued | 43,169 |
8. Purchase of PrestoCorp (Deta
8. Purchase of PrestoCorp (Details) - Prestocorp - USD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | Aug. 01, 2017 | |
Equity Method Investment, Ownership Percentage | 51.00% | 51.00% | |
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 1,027,169 | ||
Business Acquisition, Equity Interest Issued or Issuable, Value Assigned | $ 3,500,000 | ||
Shares purchased | 2,550 | ||
Goodwill, Acquired During Period | $ 3,010,000 | ||
Goodwill, Impairment Loss | 509,000 | ||
Impairment of Intangible Assets (Excluding Goodwill) | $ 472,000 |
8. Purchase of PrestoCorp_ Sche
8. Purchase of PrestoCorp: Schedule of Business Acquisitions, PrestoCorp (Details) - Prestocorp | Aug. 01, 2017USD ($) |
Cash | $ 8,713 |
Prepaid Assets | 8,565 |
Property & Equipment, Net | 8,702 |
Intellectual Property | 810,000 |
Goodwill | 3,519,202 |
Total Assets | 4,355,182 |
Accounts Payable & Accrued Expenses | (20,507) |
Fair value of NCI | 1,996,000 |
Due to - Related Parties | (5,473) |
Net Purchase (fair value of common stock issued) | $ 2,333,202 |
8. Purchase of PrestoCorp_ Pro
8. Purchase of PrestoCorp: Pro Forma Information, Acquisition (Details) - Prestocorp | 9 Months Ended |
Sep. 30, 2017USD ($) | |
Revenues | $ 680,000 |
Expenses | (5,040,000) |
Net Loss for the Period | $ (4,360,000) |
8. Purchase of PrestoCorp_ Sc_2
8. Purchase of PrestoCorp: Schedule of Finite-Lived Intangible Assets Acquired, PrestoCorp (Details) - Prestocorp | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Finite-lived Intangible Assets Acquired | $ 810,000 |
Technology-Based Intangible Assets | |
Finite-lived Intangible Assets Acquired | 520,000 |
Marketing-Related Intangible Assets | |
Finite-lived Intangible Assets Acquired | 260,000 |
Customer Lists | |
Finite-lived Intangible Assets Acquired | $ 30,000 |
10. Commitments and Contingen_3
10. Commitments and Contingencies (Details) - USD ($) | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Monthly rent expense | $ 1,392 | ||
Operating Leases, Rent Expense | 11,700 | $ 11,300 | |
Stock Payable | 1,300,729 | $ 767,603 | |
Approximate | |||
Stock Payable | 1,301,000 | $ 768,000 | |
Prestocorp | |||
Stock Payable | 541,000 | ||
Business Combination, Contingent Consideration, Liability | 541,000 | ||
Prestocorp | San Francisco Office Facilities | |||
Monthly rent expense | 2,800 | ||
Prestocorp | New York office Facilities | |||
Monthly rent expense | 800 | ||
Prestocorp | Las Vegas Office Facilities | |||
Monthly rent expense | $ 1,500 |
10. Commitments and Contingen_4
10. Commitments and Contingencies: Schedule of stock payable (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | |
Details | ||
Stock Payable | $ 1,300,729 | $ 767,603 |
Increase to Stock Payable | 2,067,981 | |
Decrease to Stock Payable | $ (1,534,855) |
11. Subsequent Events (Details)
11. Subsequent Events (Details) - USD ($) | 1 Months Ended | 9 Months Ended | 12 Months Ended |
Oct. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2017 | |
Stock Issued During Period, Value, New Issues | $ 202,000 | ||
Stock Issued During Period, Shares, Acquisitions | 10,000 | ||
Common Stock | |||
Shares Issued for Services | 429,475 | 1,229,308 | |
Stock Issued During Period, Shares, New Issues | 100,875 | ||
Common Stock | Prestocorp | |||
Stock Issued During Period, Shares, Acquisitions | 564,943 | ||
Common Stock | Subsequent Event | |||
Stock Issued During Period, Shares, New Issues | 80,000 | ||
Stock Issued During Period, Value, New Issues | $ 160,000 | ||
Common Stock | Subsequent Event | Prestocorp | |||
Stock Issued During Period, Shares, Acquisitions | 204,097 | ||
Common Stock | Consultant | Subsequent Event | |||
Shares Issued for Services | 80,986 |