MJ (MJNE) 10-Q 30 Aug 18 2018 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2018	Aug. 24, 2018
Document And Entity Information
Entity Registrant Name	MJ Holdings, Inc.
Entity Central Index Key	1,456,857
Trading Symbol	MJNE
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Document Type	10-Q
Document Period End Date	Jun. 30, 2018
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2,018
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		63,477,188

Consolidated Balance Sheets (Un

Consolidated Balance Sheets (Unaudited) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Current Assets
Cash	$ 934,296	$ 2,513,863
Prepaid expenses	635,163	5,500
Total Current Assets	1,569,459	2,519,363
Fixed assets
Leasehold improvements	378,237	17,535
Other Assets
Deposits	38,633	42,383
Intangible asset (net)	300,000	300,000
Noncurrent assets held for disposition	584	584
Total Assets	2,286,913	2,879,865
Current Liabilities:
Accounts payable and accrued liabilities	4,250	70,382
Customer deposits	386,416
Convertible notes payable due to related party		900,000
Total Current Liabilities	390,666	970,382
Noncurrent liabilities:
Deferred rent	209,881	104,565
Total noncurrent liabilities	209,881	104,565
Total Liabilities	600,547	1,074,947
Stockholders' Equity
Preferred stock, par value $0.001, 5,000,000 shares authorized; 0 shares issued and outstanding
Common stock, par value $0.001, 95,000,000 shares authorized; 63,477,188 and 62,675,407 shares issued and outstanding as of June 30, 2018 and December 31, 2017, respectively	63,477	62,675
Additional paid in capital	2,305,299	1,704,764
Common stock to be issued	600,000	400,000
Stock subscription receivable	(125,000)
Accumulated deficit	(1,157,410)	(362,521)
Total Stockholders' Equity	1,686,366	1,804,918
Total Liabilities and Stockholders' Equity	$ 2,286,913	$ 2,879,865

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) (Unaudited) - $ / shares	Jun. 30, 2018	Dec. 31, 2017
Statement of Financial Position [Abstract]
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	95,000,000	95,000,000
Common stock, shares issued	63,477,188	62,675,407
Common stock, shares outstanding	63,477,188	62,675,407

Consolidated Statements of Oper

Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Income Statement [Abstract]
Net Revenues
Operating Expenses
General and administrative	419,233	35,479	610,998	35,479
Sales and marketing	174,741		184,256
Total operating expenses	593,974	35,479	795,254	35,479
Operating loss	(593,974)	(35,479)	(795,254)	(35,479)
Other Expenses (Income)
Interest expense (income)	(161)	11,103	(365)	13,743
Total other expenses (income)	(161)	11,103	(365)	13,743
Loss before provision for income taxes	(593,813)	(46,582)	(794,889)	(49,222)
Provision for income taxes
Net Loss	$ (593,813)	$ (46,582)	$ (794,889)	$ (49,222)
Basic and diluted net loss per common share:	$ (0.01)	$ 0	$ (0.01)	$ 0
Weighted average shares outstanding	63,159,497	52,732,969	63,071,079	52,732,969

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (Unaudited) - USD ($)	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Cash Flows from Operating Activities
Net loss	$ (794,889)	$ (49,222)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization of debt issuance cost		6,600
Amortization of deferred rent expense	105,315
Common stock issued for services	4,836
Changes in operating assets and liabilities:
Prepaid expenses	(629,663)
Deposits	3,750
Accounts payable and accrued liabilities	(66,132)	7,143
Customer deposits	386,416
Net cash used in operating activities	(990,367)	(35,479)
Cash Flows from Investing Activities:
Purchase of growth license		(300,000)
Payments for leasehold improvements	(360,701)
Net cash used in investing activities	(360,701)	(300,000)
Cash Flows from Financing Activities
Proceeds from issuance of common stock	471,501
Proceeds from common stock to be issued	200,000
Proceeds from notes payable		335,479
Repayment of convertible note due to related party	(900,000)
Net cash provided by (used in) financing activities	(228,499)	335,479
Net decrease in cash	(1,579,567)
Cash, beginning of period	2,513,863
Cash, end of period	$ 934,296

Nature of the Business

Nature of the Business	6 Months Ended
	Jun. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Nature of the Business	Note 1 — Nature of the Business MJ Holdings, Inc. (“the Company”) is a holding company whose subsidiaries provide infrastructure, consulting and construction services, in addition to holding, and managing third party state issued cultivation and production licenses. Our wholly owned subsidiary, Red Earth, LLC (“Red Earth”) is the holder of provisional Medical Marijuana Establishment Registration Certificate (the “Certificate”). In April 2018, the State of Nevada finalized and approved the transfer of the provisional Medical Marijuana Establishment Registration Certificate (the “Certificate”) from our wholly owned subsidiary, Red Earth, LLC (“Red Earth”) to the Company. The Certificate, when perfected, will allow the Company to commence legal marijuana cultivation activities in the State of Nevada. HDGLV, LLC, a wholly owned subsidiary of Red Earth, holds a triple-net leasehold, with an option to buy, on a 17,298 square-foot building, which will be home to our cultivation facility. We expect Phase 1 of this facility to be completed in the third quarter of 2018. We expect final approval by the State of Nevada, Department of Taxation of our Certificate and issuance of a Business License from the City of Las Vegas in the third quarter of 2018. In April 2018, the Company entered into a management agreement with a Nevada company (the “Licensed Operator”) that holds a license, for the legal cultivation of marijuana for sale under the laws of the State of Nevada. The Licensed Operator has engaged us to develop, manage, and operate a licensed cultivation facility on property owned by the Licensed Operator. At our sole cost and expense, we have agreed to complete the construction of a 120,000 square-foot outdoor grow facility, including the construction of an 8,000 square-foot building and installation of security fencing, meeting the State of Nevada building codes and regulations. We expect to receive all necessary state and local approvals and complete construction of the facility to commence operations in the latter part of the third quarter of 2018. It is the Company’s intention to grow its business through the acquisition of existing companies and/or through the development of new opportunities that can provide a 360-degree spectrum of infrastructure (dispensaries), cultivation/production management, and consulting services in the regulated cannabis industry.

Summary of Significant Accounti

Summary of Significant Accounting Policies	6 Months Ended
	Jun. 30, 2018
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	Note 2 — Summary of Significant Accounting Policies The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Accordingly, these consolidated financial statements do not include all of the information and footnotes required for audited annual financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary to make the consolidated financial statements not misleading have been included. The balance sheet at December 31, 2017, has been derived from the Company’s audited consolidated financial statements as of that date. The unaudited consolidated financial statements included herein should be read in conjunction with the audited consolidated financial statements and the notes thereto that are included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017, that was filed with the SEC on July 27, 2018. The results of operations for the three months ended March 31, 2018, are not necessarily indicative of the results to be expected for the full year or any further periods. The unaudited consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. Intercompany balances and transactions have been eliminated in consolidation. The significant accounting policies followed by the Company for interim reporting are consistent with those included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017. There were no material changes to our significant accounting policies during the interim period ended March 31, 2018.

Going Concern

Going Concern	6 Months Ended
	Jun. 30, 2018
Going Concern [Abstract]
Going Concern	Note 3 — Going Concern The Company’s financial statements have been prepared on a going concern basis, which contemplates the realization of assets and settlement of liabilities and commitments in the normal course of business. The Company’s primary asset is a provisional Medical Marijuana Establishment Registration Certificate issued by the State of Nevada for the cultivation of medical marijuana. There is no assurance on the receipt and/or timing of final approvals from the appropriate authorities. The Company has not generated any revenues from inception (October 17, 2016) to June 30, 2018 and has an accumulated deficit of $1,157,410. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. In the event the Company experiences liquidity and capital resource constraints because of unanticipated operating losses, we may need to raise additional capital in the form of equity and/or debt financing. If such additional capital is not available on terms acceptable to us or at all, then we may need to curtail our operations and/or take additional measures to conserve and manage our liquidity and capital resources, any of which would have a material adverse effect on our financial position, results of operations, and our ability to continue in existence. These financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Prepaid Expenses

Prepaid Expenses	6 Months Ended
	Jun. 30, 2018
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Prepaid Expenses	Note 4 — Prepaid Expenses Green Houses On February 8, 2018 the Company entered into an agreement with an unrelated third party for the purpose of designing, purchasing and reselling green houses for sale. Under the agreement the Company was to contribute its expertise in construction, and the other party their expertise in designing, procuring and operating green houses. In April of 2018 the third party informed the Company that it was unable to satisfy their duties under the agreement due to unrelated hardships. Upon their departure the Company agreed with the purchasers to complete the agreement, which includes the design, purchase and installation of six (6) green houses to four (4) separate purchasers. As of June 30, 2018 the Company had received $386,416 in deposits from the purchasers which were recorded as customer deposits on the balance sheet, and had prepaid for the manufacture and sale of the green houses $335,163 as prepaid expenses related to the design, purchase and resale of green houses. Management Agreement On April 18, 2018 the Company entered into a management agreement with a Nevada company (the “Licensed Operator”) that holds a cultivation license, such that it can lawfully engage in the cultivation of marijuana for sale under the laws of the State of Nevada. The term of the agreement is for 8 years. The Licensed Operator has engaged the Company to develop, manage, and operate a licensed cultivation facility on 3 acres of property owned by the Licensed Operator. The Company, at its sole cost and expense, has agreed to complete the construction of an outdoor grow facility meeting the local and state building codes and regulations to cultivate marijuana. Upon completion of the build-out of the outdoor grow facility and obtaining the appropriate approvals from the local and state authorities, the Company has agreed to generate sales of at least $5 million per year from product cultivated from the outdoor grow facility. The Licensed Operator may terminate the agreement if annual sales fall below the $5 million minimum requirement as defined in the agreement. Prior to the termination of the agreement by the Licensed Operator, the Company may cure any applicable deficiency by paying 10% of the deficiency to the Licensed Operator. Pursuant to the management agreement, the Licensed Operator will retain 15% of the net revenues generated from product cultivated from the outdoor grow facility and pay 85% of the net revenues to the Company. Upon execution of the agreement, the Company paid $300,000 to the Licensed Operator as consideration for the opportunity to construct and manage the outdoor grow facility on the Licensed Operator’s property. In exchange for the initial consideration, the Licensed Operator has agreed not to retain 15% of the first $2 million of net revenues generated from the outdoor grow facility. In addition, once the outdoor grow facility begins production, the Company has agreed to pay the Licensed Operator $7,000 per month for compliance, security, and other administration costs incurred by the Licensed Operator during the term of the agreement. As of June 30, 2018 the Company recorded the $300,000 paid to the Licensed Operator as prepaid expenses.

Leasehold Improvements

Leasehold Improvements	6 Months Ended
	Jun. 30, 2018
Leases [Abstract]
Leasehold Improvements	Note 5 — Leasehold Improvements On April 18, 2018 the Company entered into a management agreement as described in Note 4, Management Agreement. Pursuant to that agreement the Company commenced construction of the outdoor grow facility. As of June 30, 2018 the Company had incurred and capitalized $296,735 in costs associated with the construction of this facility. During the quarter ended June 30, 2018 the Company incurred costs associated with the development of an indoor grow facility located at 2310 Western Avenue in Las Vegas, which holds a triple net leasehold interest in a 17,298 square-foot building where a provisional cultivation license to grow marijuana within the City of Las Vegas in the State of Nevada has been obtained. Once completed the Company intends to operate as an indoor marijuana cultivation and an agritourism destination. Completion of this facility is expected in the third quarter of 2018. This facility is intended to serve as a draw for tourists who desire to visit, see, and learn about the inner-workings of a cannabis cultivation facility. As of June 30, 2018 the Company had incurred and capitalized $81,502 in costs associated with the construction of this facility.

Intangible Assets

Intangible Assets	6 Months Ended
	Jun. 30, 2018
Goodwill and Intangible Assets Disclosure [Abstract]
Intangible Assets	Note 6 — Intangible Assets In October 2016, Red Earth entered into an Asset Purchase and Sale Agreement with the owner of a provisional Medical Marijuana Establishment Registration Certificate (the “Provisional Grow License”) issued by the State of Nevada for the cultivation of medical marijuana for $300,000. To initiate the purchase and transfer the Provisional Grow License, the Company paid a $25,000 deposit to the seller in October 2016. In February 2017, an investor advanced the Company $350,000 to fund the purchase of the Provisional Grow License. The Provisional Grow License remains in a provisional status until the Company has completed the build out of a cultivation facility and obtained approval from the State of Nevada to begin cultivation in the approved facility. Once approval from the State of Nevada is received and the Company begins the cultivation process, the intangible asset will be amortized over its useful life.

Convertible Note Payable Due to

Convertible Note Payable Due to Related Party	6 Months Ended
	Jun. 30, 2018
Related Party Transactions [Abstract]
Convertible Note Payable Due to Related Party	Note 7 — Convertible Note Payable Due to Related Party On December 15, 2017, the Company issued a convertible note payable in the amount of $900,000 to the members of Red Earth. The managing partner and 50% owner of Red Earth at the time of the transaction was Paris Balaouras, the Company’s Chief Executive Officer. The convertible note payable is due October 15, 2018. The note is convertible into shares of the Company’s common stock at the holder’s discretion at a conversion price of $0.75 per share. The note accrues interest, commencing six months from the issuance date, at a rate equal to one half of one percent (0.50%) per annum. Interest shall be payable on the maturity date or the conversion date, if applicable. The Company assessed the embedded conversion feature of the note payable and determined that the fair value of the underlying common stock at inception did not exceed the conversion price of the convertible note. Since, at the time the convertible note was issued, the Company’s common stock had limited publicly traded volume, the Company based the fair value of the Company’s common stock on the sales of the Company’s common stock, which were sold at $0.75 per share. In January 2018, the $900,000 convertible note payable due to a related party was repaid in full.

Capital Stock

Capital Stock	6 Months Ended
	Jun. 30, 2018
Equity [Abstract]
Capital Stock	Note 8 — Capital Stock During the six months ended June 30, 2018, the Company sold and issued an aggregate of 795,333 shares of the Company’s common stock at $0.75 per share for gross proceeds of $596,500, $125,000 of which were received in July 2018. In addition, the Company received $200,000 pursuant to stock subscription agreements to purchase 266,667 shares of common stock at $0.75 per share, but the shares had not been issued as of August 24, 2018. During the six months ended June 30, 2018, the Company issued an aggregate of 6,448 shares of the Company’s common stock in exchange for professional services valued at $4,836.

Warrants

Warrants	6 Months Ended
	Jun. 30, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Warrants	Note 9 — Warrants Prior to the Reverse Merger, the Company had issued warrants as compensation for consulting services. The warrants expire between June 2019 and October 2019. The following table summarizes all stock warrant activity of the Company for the six months ended June 30, 2018: Weighted Avg. Exercise Warrants: Shares Price Balance at December 31, 2017 166,665 $ 5.88 Issued — — Exercised — — Expired — — Balance at June 30, 2018 166,665 $ 5.88

Commitments and Contingencies

Commitments and Contingencies	6 Months Ended
	Jun. 30, 2018
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Note 10 — Commitments and Contingencies Operating Leases The Company leases an office facility and a production / warehouse facility under two non-cancelable operating leases that expire in May 2019 and June 2027, respectively. Future minimum rental and lease commitments under non-cancelable operating leases with terms in excess of one year as of June 30, 2018, are as follows: Amount Fiscal year ending December 31: 2018 $ 139,920 2019 249,090 2020 230,640 2021 230,640 2022 230,755 Thereafter 1,043,315 Total minimum lease payments $ 2,124,360 Rent expense, including deferred rent expense of $209,881, incurred pursuant to operating leases for the six months ended June 30, 2018 and 2017, was $105,316 and $0, respectively. Litigation There are no legal proceedings which are pending or have been threatened against us or any of our officers, directors or control persons of which management is aware.

Subsequent Events

Subsequent Events	6 Months Ended
	Jun. 30, 2018
Subsequent Events [Abstract]
Subsequent Events	Note 11 — Subsequent Events On July 1, 2018 the Company entered into a Corporate Advisory Agreement On August 9, 2018 (the “Transaction Date”), the Company entered into a Securities Purchase Agreement, pursuant to which the Company sold and issued 2,500 shares of its Series A Convertible Preferred Stock (the “Preferred Stock”) to a single institutional, accredited investor for $1,000 per share or an aggregate subscription of $2,500,000. Subject to a standard “4.99% Beneficial Ownership Limitation blocker,” the Preferred Stock is convertible into 3,333,334 shares of the Company’s Common Stock at a conversion price of $0.75 per share, subject to adjustment as described in the Certificate of Designation. The Company also entered into a Registration Rights Agreement with the purchaser, pursuant to which the Company is obligated to file a registration statement with the Securities and Exchange Commission (the “Commission”), within 30 calendar days of the Transaction Date, to register for resale the shares of common stock underlying the Preferred Stock. If the Commission has not declared the registration statement effective by the 60th calendar day following the Transaction Date (or, in the event of a “full review” by the Commission, the 90th calendar day following the Transaction Date), or upon the occurrence of other events, then the Company shall pay to the purchaser an amount in cash, as partial liquidated damages and not as a penalty, equal to the product of 4.0% multiplied by the aggregate subscription amount paid by the purchaser pursuant to the Purchase Agreement on a monthly basis until the event has been cured. On August 13, 2018, the Company filed a Certificate of Designation of its Series A Convertible Preferred Stock with the Secretary of State of the State of Nevada to designate a series of its convertible preferred stock, consisting of 2,500 shares. The stated value of each share of Preferred Stock is $1,000. Subject to a standard “4.99% Beneficial Ownership Limitation blocker,” each share of Preferred Stock is convertible into shares of the Company’s common stock at any time or from time to time at a conversion price equivalent of $0.75 per share, subject to adjustment as described in Certificate of Designation. On August 13, 2018 (the “Effective Transaction Date”), the Company closed the transactions contemplated by an Exclusive Distribution Agreement (the “Agreement”). The Agreement is between the Company and a designer and seller (the “Seller”) of a series of related products, all of which are designed to be utilized to consume cannabis products by vaporizing oil and other products related thereto (the “Goods”). The Company has the exclusive right to distribute the Goods in the territory of Nevada (the “Territory”). The Agreement further requires the Company to advertise and market the Goods in the Territory. Pursuant to the terms of the Agreement, the Company purchased certain Goods from the Seller and tendered the sum of two million dollars ($2,000,000). The funds were transferred to the Seller on the Effective Transaction Date. The Seller has applied for patent protection in respect of one of the products. As of the date of this Current Report, the patent application is still pending. The initial term of the Agreement is for one year with additional successive one-year renewals, subject to certain standard termination provisions. The Agreement is subject to standard termination provisions; however, the Seller has the option to terminate the Agreement, on 30 days’ written notice, if the Company fails to purchase a sufficient minimum quantity of Goods from the Seller. The Company has met its obligations for the first year of the Agreement ($2,000,000). Thereafter, for each renewal term, the Company’s minimum purchase obligation for the Goods is currently $500,000, subject to good faith negotiation at the end of each year. Notwithstanding the exclusivity provided by the Agreement, the Seller reserves the right to sell Goods, directly or indirectly, to a specific retail group (the “Excluded Account”). In such event, the Seller shall pay to the Company a fee equivalent to 5% of the gross sales of the Goods that the Seller sold to an Excluded Account in Nevada. The Company, however, does not have the right to appoint sub-distributors or sell Goods through any third party. In connection with the transactions contemplated by the Agreement, the Seller granted to the Company a non-exclusive, non-transferrable, and non-sub licensable fully paid license agreement. The Agreement provides standard cross-indemnity provisions.

Warrants (Tables)

Warrants (Tables)	6 Months Ended
	Jun. 30, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Summary of warrants issued, exercised and expired	Weighted Avg. Exercise Warrants: Shares Price Balance at December 31, 2017 166,665 $ 5.88 Issued — — Exercised — — Expired — — Balance at June 30, 2018 166,665 $ 5.88

Commitments and Contingencies (

Commitments and Contingencies (Tables)	6 Months Ended
	Jun. 30, 2018
Commitments and Contingencies Disclosure [Abstract]
Schedule of future minimal rental and lease commitments	Amount Fiscal year ending December 31: 2018 $ 139,920 2019 249,090 2020 230,640 2021 230,640 2022 230,755 Thereafter 1,043,315 Total minimum lease payments $ 2,124,360

Nature of the Business (Details

Nature of the Business (Details)	1 Months Ended
	Apr. 30, 2018ft²	Apr. 18, 2018a
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Option to buy building for cultivation facility	17,298	3
Construction of area, description	we have agreed to complete the construction of a 120,000 square-foot outdoor grow facility, including the construction of an 8,000 square-foot building and installation of security fencing, meeting the State of Nevada building codes and regulations. We expect to receive all necessary state and local approvals and complete construction of the facility to commence operations in the latter part of the third quarter of 2018.

Going Concern (Details)

Going Concern (Details) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Going Concern (Textual)
Accumulated deficit	$ (1,157,410)	$ (362,521)

Prepaid Expenses (Details)

Prepaid Expenses (Details)	1 Months Ended
	Apr. 18, 2018a	Jun. 30, 2018USD ($)	Apr. 30, 2018ft²	Dec. 31, 2017USD ($)
Prepaid Expenses (Textual)
Deposits		$ 386,416
Prepaid expenses		335,163
Condition of operator terminate sales agreement, description	The Company has agreed to generate sales of at least $5 million per year from product cultivated from the outdoor grow facility. The Licensed Operator may terminate the agreement if annual sales fall below the $5 million minimum requirement as defined in the agreement. Prior to the termination of the agreement by the Licensed Operator, the Company may cure any applicable deficiency by paying 10% of the deficiency.
Amount to paid from revenue, description	The Licensed Operator will retain 15% of the net revenues generated from product cultivated from the outdoor grow facility and pay 85% of the net revenues to the Company. Upon execution of the agreement, the Company paid $300,000 to the Licensed Operator as consideration for the opportunity to construct and manage the outdoor grow facility on the Licensed Operator’s property. In exchange for the initial consideration, the Licensed Operator has agreed not to retain 15% of the first $2 million of net revenues generated from the outdoor grow facility. In addition, once the outdoor grow facility begins production, the Company has agreed to pay the Licensed Operator $7,000 per month for compliance, security, and other administration costs incurred by the Licensed Operator during the term of the agreement.
Licensed operator as prepaid expenses		$ 300,000
Term of agreement	8 years
Acres of property	3		17,298

Leasehold Improvements (Details

Leasehold Improvements (Details)	Jun. 30, 2018USD ($)ft²
Leasehold Improvements (Textual)
Capitalized costs	$ 81,502
Area Leasehold | ft²	17,298
Leasehold Improvements [Member]
Leasehold Improvements (Textual)
Capitalized costs	$ 296,735

Intangible Assets (Details)

Intangible Assets (Details) - USD ($)	1 Months Ended		6 Months Ended
	Feb. 28, 2017	Oct. 31, 2016	Jun. 30, 2018	Jun. 30, 2017
Intangible Assets (Textual)
Provisional of cultivation of medical marijuana				$ 300,000
Provisional Grow License [Member]
Intangible Assets (Textual)
Provisional of cultivation of medical marijuana		$ 300,000
License amount paid deposit to seller		$ 25,000
Advanced amount of fund the purchase of license	$ 350,000

Convertible Note Payable Due 24

Convertible Note Payable Due to Related Party (Details) - Red Earth LLC [Member] - USD ($)	Dec. 15, 2017	Jan. 31, 2018
Convertible Note Payable Due to Related Party (Textual)
Convertible note payable amount	$ 900,000
Conversion price	$ 0.75
Percentage of accrues interest	0.50%
Sold of common stock per shares	$ 0.75
Related party transaction, percentage	50.00%
Convertible note payable due to a related party		$ 900,000

Capital Stock (Details)

Capital Stock (Details) - USD ($)	1 Months Ended	6 Months Ended
	Jul. 31, 2018	Jun. 30, 2018
Subsequent Event [Member]
Capital Stock (Textual)
Received from stock amount	$ 125,000
Capital Stock [Member]
Capital Stock (Textual)
Common stock sold and issued an aggregate		795,333
Sale of common stock, price per share		$ 0.75
Gross proceeds from stock		$ 596,500
Received from stock amount		$ 200,000
Stock subscription agreement to purchase common stock		266,667
Common stock, price per share		$ 0.75
Common stock exchange for professional services		6,448
Common stock in exchange for professional services, value		$ 4,836

Warrants (Details)

Warrants (Details) - Warrant [Member]	6 Months Ended
	Jun. 30, 2018$ / sharesshares
Warrants:
Shares, Beginning Balance | shares	166,665
Shares, Issued | shares
Shares, Exercised | shares
Shares, Expired | shares
Shares Ending, Balance | shares	166,665
Weighted Avg. Exercise Price, Beginning Balance | $ / shares	$ 5.88
Weighted Avg. Exercise Price, Issued | $ / shares
Weighted Avg. Exercise Price, Exercised | $ / shares
Weighted Avg. Exercise Price, Expired | $ / shares
Weighted Avg Exercise Price, Ending Balance | $ / shares	$ 5.88

Commitments and Contingencies27

Commitments and Contingencies (Details)	Jun. 30, 2018USD ($)
Summary of future minimum lease obligation
2,018	$ 139,920
2,019	249,090
2,020	230,640
2,021	230,640
2,022	230,755
Thereafter	1,043,315
Total minimum lease payments	$ 2,124,360

Commitments and Contingencies28

Commitments and Contingencies (Details Textual) - USD ($)	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Commitments and Contingencies (Textual)
Deferred rent expense	$ 209,881		$ 104,565
Operating leases rent expense	$ 105,316	$ 0
Description of operating lease expiration	The Company leases an office facility and a production / warehouse facility under two non-cancelable operating leases that expire in May 2019 and June 2027, respectively.

Subsequent Events (Details)

Subsequent Events (Details) - Subsequent Event [Member] - USD ($)	Aug. 13, 2018	Aug. 09, 2018	Jul. 01, 2018
Subsequent Events (Textual)
Issuance of series A convertible preferred stock	2,500
Series A convertible preferred stock per share	$ 1,000
Beneficial Ownership Limitation blocker	4.99%
Conversion price	$ 0.75
Purchased of goods under purchase obligation	$ 2,000,000
Minimum purchase obligation for each year	$ 500,000
Percentage of sale of goods	5.00%
Advisory Agreement [Member]
Subsequent Events (Textual)
Issuance of stock during the period			14,444
Stock issued acquired additional shares			10,000
Advisory agreement term			12 months
Securities Purchase Agreement [Member]
Subsequent Events (Textual)
Issuance of series A convertible preferred stock		2,500
Aggregate value		$ 2,500,000
Series A convertible preferred stock per share		$ 1,000
Beneficial Ownership Limitation blocker		4.99%
Preferred stock is convertible into common stock		3,333,334
Conversion price		$ 0.75