Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Mar. 31, 2017 | May 10, 2017 | |
Document And Entity Information | ||
Entity Registrant Name | DigiPath,Inc. | |
Entity Central Index Key | 1,502,966 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --09-30 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 31,707,116 | |
Trading Symbol | DIGP | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2,017 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Mar. 31, 2017 | Sep. 30, 2016 |
Current assets: | ||
Cash | $ 277,560 | $ 135,390 |
Accounts receivable, net | 166,964 | 98,441 |
Prepaid expenses | 44,184 | 24,246 |
Deposits | 25,647 | 39,850 |
Total current assets | 514,355 | 297,927 |
Fixed assets, net | 1,019,445 | 1,139,748 |
Available-for-sale securities | 15,720 | 9,200 |
Total Assets | 1,549,520 | 1,446,875 |
Current liabilities: | ||
Accounts payable | 53,222 | 157,666 |
Accrued expenses | 31,708 | 54,247 |
Total current liabilities | 84,930 | 211,913 |
Total Liabilities | 84,930 | 211,913 |
Stockholders’ Equity: | ||
Series A convertible preferred stock, $0.001 par value, 10,000,000 shares authorized; 2,290,442 and 3,520,442 shares issued and outstanding at March 31, 2017 and September 30, 2016, respectively | 2,290 | 3,520 |
Common stock, $0.001 par value, 90,000,000 shares authorized; 30,754,616 and 22,491,041 shares issued and outstanding at March 31, 2017 and September 30, 2016, respectively | 30,755 | 22,491 |
Additional paid-in capital | 12,247,116 | 11,681,282 |
Accumulated other comprehensive loss | (34,280) | (40,800) |
Accumulated (deficit) | (10,781,291) | (10,431,531) |
Total Digipath, Inc. Stockholders' Equity | 1,464,590 | 1,234,962 |
Noncontrolling interest | ||
Total Stockholders’ Equity | 1,464,590 | 1,234,962 |
Total Liabilities and Stockholders’ Equity | $ 1,549,520 | $ 1,446,875 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2017 | Sep. 30, 2016 |
Statement of Financial Position [Abstract] | ||
Series A Convertible Preferred stock, par value | $ 0.001 | $ 0.001 |
Series A Convertible Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Series A Convertible Preferred stock, shares issued | 2,290,442 | 3,520,442 |
Series A Convertible Preferred stock, shares outstanding | 2,290,442 | 3,520,442 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 90,000,000 | 90,000,000 |
Common stock, shares issued | 30,754,616 | 22,491,041 |
Common stock, shares outstanding | 30,754,616 | 22,491,041 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
Income Statement [Abstract] | ||||
Revenues | $ 497,049 | $ 141,116 | $ 906,800 | $ 243,252 |
Cost of sales | 221,010 | 85,367 | 425,142 | 155,359 |
Gross profit | 276,039 | 55,749 | 481,658 | 87,893 |
Operating expenses: | ||||
General and administrative | 327,384 | 280,961 | 607,070 | 607,693 |
Professional fees | 273,951 | 167,804 | 465,594 | 410,688 |
Bad debts expense | 6,804 | 13,250 | 23,754 | 303,021 |
Total operating expenses | 608,139 | 462,015 | 1,096,418 | 1,321,402 |
Operating loss | (332,100) | (406,266) | (614,760) | (1,233,509) |
Other income (expense): | ||||
Other income | 106,000 | 12,000 | 260,000 | 30,000 |
Interest income | 2,500 | 2,500 | 5,000 | 5,000 |
Gain on early extinguishment of debt | 12,133 | |||
Equity in losses of unconsolidated entity | (54,431) | (992,682) | ||
Total other income (expense) | 108,500 | (39,931) | 265,000 | (945,549) |
Net loss from continuing operations | (223,600) | (446,197) | (349,760) | (2,179,058) |
Less: Net loss attributable to the noncontrolling interest | ||||
Net loss | $ (223,600) | $ (446,197) | $ (349,760) | $ (2,179,058) |
Weighted average number of common shares outstanding - basic and fully diluted | 28,063,050 | 16,650,142 | 25,982,694 | 15,675,948 |
Net loss per share - basic and fully diluted | $ (0.01) | $ (0.03) | $ (0.01) | $ (0.14) |
Net loss attributable to Digipath, Inc. | $ (223,600) | $ (446,197) | $ (349,760) | $ (2,179,058) |
Available-for-sale investments: | ||||
Change in net unrealized income (loss) (net of tax effect) | (280) | (2,720) | 6,520 | (6,120) |
Comprehensive loss | $ (223,880) | $ (448,917) | $ (343,240) | $ (2,185,178) |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Cash flows from operating activities | ||
Net loss | $ (349,760) | $ (2,179,058) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Bad debts expense | 23,754 | 303,021 |
Depreciation and amortization expense | 123,073 | 122,230 |
Stock issued for services, related parties | 58,123 | 17,500 |
Stock issued for services | 64,905 | 38,480 |
Options and warrants granted for services, related parties | 179,952 | 16,372 |
Options and warrants granted for services | 19,888 | 111,569 |
Gain on early extinguishment of debt | (12,133) | |
Equity in losses of unconsolidated entity | 992,682 | |
Decrease (increase) in assets: | ||
Accounts receivable | (92,277) | (50,384) |
Prepaid expenses | (19,938) | (8,883) |
Deposits | 14,203 | |
Increase (decrease) in liabilities: | ||
Accounts payable | (104,444) | 63,998 |
Accrued expenses | (22,539) | 1,450 |
Deferred revenues | (4,167) | |
Net cash used in operating activities | (105,060) | (587,323) |
Cash flows from investing activities | ||
Cash disposed in divestiture of unconsolidated entity | (57,876) | |
Purchase of fixed assets | (2,770) | (10,579) |
Net cash used in investing activities | (2,770) | (68,455) |
Cash flows from financing activities | ||
Proceeds from sale of common stock | 250,000 | 357,500 |
Net cash provided by financing activities | 250,000 | 357,500 |
Net increase (decrease) in cash | 142,170 | (298,278) |
Cash - beginning | 135,390 | 481,095 |
Cash - ending | 277,560 | 182,817 |
Supplemental disclosures: | ||
Interest paid | ||
Income taxes paid | ||
Non-cash investing and financing activities: | ||
Net change in unrealized gain (loss) on available-for-sale securities | 6,520 | (6,120) |
Value of preferred stock converted to common stock | $ 1,230,000 | $ 380,000 |
Organization, Basis of Presenta
Organization, Basis of Presentation and Significant Accounting Policies | 6 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Organization, Basis of Presentation and Significant Accounting Policies | Note 1 – Organization, Basis of Presentation and Significant Accounting Policies Organization Digipath, Inc. was incorporated in Nevada on October 5, 2010. Digipath, Inc. and its subsidiaries (“Digipath,” the “Company,” “we,” “our” or “us”) supports the cannabis industry’s best practices for reliable testing, cannabis education and training, and brings unbiased cannabis news coverage to the cannabis industry. Our business units are described below. ● Digipath Labs, Inc ● The National Marijuana News Corp Basis of Presentation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). Intercompany accounts and transactions have been eliminated. The unaudited condensed consolidated financial statements of the Company and the accompanying notes included in this Quarterly Report on Form 10-Q are unaudited. In the opinion of management, all adjustments necessary for a fair presentation of the Condensed Consolidated Financial Statements have been included. Such adjustments are of a normal, recurring nature. The Condensed Consolidated Financial Statements, and the accompanying notes, are prepared in accordance with GAAP and do not contain certain information included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2016. The interim Condensed Consolidated Financial Statements should be read in conjunction with that Annual Report on Form 10-K. Results for the interim periods presented are not necessarily indicative of the results that might be expected for the entire fiscal year. Principles of Consolidation The accompanying consolidated financial statements include the accounts of the following entities, all of which were under common control and ownership at September 30, 2016: State of Name of Entity (1) Incorporation Relationship Digipath, Inc. (2) Nevada Parent Digipath Labs, Inc. Nevada Subsidiary TNM News, Inc. Nevada Subsidiary GroSciences, Inc. (3) Colorado Subsidiary (1) All entities are in the form of a corporation. (2) Holding company, which owns each of the wholly-owned subsidiaries. All subsidiaries shown above are wholly-owned by Digipath, Inc., the parent company. (3) Entity formed for prospective purposes, but has not incurred any income or expenses to date. The consolidated financial statements herein contain the operations of the wholly-owned subsidiaries listed above. All significant inter-company transactions have been eliminated in the preparation of these financial statements. The parent company and subsidiaries will be collectively referred to herein as the “Company”, “Digipath” or “DIGP”. The Company’s headquarters are located in Las Vegas, Nevada and substantially all of its customers are within the United States. These statements reflect all adjustments, consisting of normal recurring adjustments, which in the opinion of management are necessary for fair presentation of the information contained therein. Equity Method Investee companies that are not consolidated, but over which the Company exercises significant influence, are accounted for under the equity method of accounting. Whether or not the Company exercises significant influence with respect to an Investee depends on an evaluation of several factors including, among others, representation on the Investee company’s board of directors and ownership level, which is generally a 20% to 50% interest in the voting securities of the Investee company. Under the equity method of accounting, an Investee company’s accounts are not reflected within the Company’s Consolidated Balance Sheets and Statements of Operations; however, the Company’s share of the earnings or losses of the Investee company is reflected in the caption “Equity in losses of unconsolidated entity” in the Consolidated Statements of Operations. The Company’s carrying value in an equity method Investee company is reflected in the caption “Investment in Digipath Corp.” in the Company’s Consolidated Balance Sheets. As of March 31, 2017, our share of losses from the investee company exceeded our basis, therefore the investment is not currently presented on the balance sheet. U.S. GAAP considers a change in reporting entity to include “changing specific subsidiaries that make up the group of entities for which consolidated financial statements are presented.” Circumstances may arise where a parent’s controlling financial interest (e.g., generally an ownership interest in excess of 50 percent of the outstanding voting stock) is reduced to a noncontrolling investment that still enables it to exercise significant influence over the operating and financial policies of the investee. A change that results from changed facts and circumstances (such as a partial sale of a subsidiary), where there was only one acceptable method of accounting prior to the change in circumstances (consolidation) and only one acceptable method of accounting after the change (equity method accounting), is not a change in reporting entity and is not be accounted for retrospectively. Accordingly, a change from a controlling interest to a noncontrolling investment accounted for under the equity method is accounted for prospectively from the date of change in control. When the Company’s carrying value in an equity method Investee company is reduced to zero, no further losses are recorded in the Company’s consolidated financial statements unless the Company guaranteed obligations of the Investee company or has committed additional funding. When the Investee company subsequently reports income, the Company will not record its share of such income until it equals the amount of its share of losses not previously recognized. Segment Reporting ASC Topic 280, “Segment Reporting,” requires use of the “management approach” model for segment reporting. The management approach model is based on the way a company’s management organizes segments within the company for making operating decisions and assessing performance. The Company operates as a single segment and will evaluate additional segment disclosure requirements as it expands its operations. Fair Value of Financial Instruments Under FASB ASC 820-10-05, the Financial Accounting Standards Board establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosures about fair value measurements. This Statement reaffirms that fair value is the relevant measurement attribute. The adoption of this standard did not have a material effect on the Company’s financial statements as reflected herein. The carrying amounts of cash, accounts receivable, accounts payable and accrued expenses reported on the balance sheets are estimated by management to approximate fair value primarily due to the short term nature of the instruments. In addition, the Company had debt instruments that required fair value measurement on a recurring basis. Revenue Recognition The Company recognizes revenue in accordance with ASC 605, Revenue Recognition. ASC 605 requires that four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery of product has met the criteria established in the arrangement or services rendered; (3) the fee is fixed and determinable; and (4) collectability is reasonably assured. This occurs when the products or services are completed in accordance with the contracts we have with clients. In connection with our products and services arrangements, when we are paid in advance, these amounts are classified as deferred revenue and amortized over the term of the agreement. With respect to our cannabis lab testing revenues, we sell our services on a determinable fixed fee per test, or panel of tests basis, and offer a discounted price for customers that agree to enter into exclusive, long term contracts. We typically require payment within thirty days of the delivery of results. Revenues are recognized upon the substantial completion of the tests when collectability is reasonably assured, which is usually upon delivery of results to the customer. Stock-Based Compensation The Company accounts for equity instruments issued to employees in accordance with the provisions of ASC 718 Stock Compensation (ASC 718) and Equity-Based Payments to Non-employees pursuant to ASC 505-50 (ASC 505-50). All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. The measurement date of the fair value of the equity instrument issued is the earlier of the date on which the counterparty’s performance is complete or the date at which a commitment for performance by the counterparty to earn the equity instruments is reached because of sufficiently large disincentives for nonperformance. Recent Accounting Pronouncements In January 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2017-04, Intangibles – Goodwill and Other (Topic 350) In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business In December 2016, the FASB issued ASU 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers Revenue from Contracts with Customers In October 2016, the FASB issued ASU No. 2016-17, Consolidation (Topic 810): Interests Held through Related Parties that are under Common Control In October 2016, the FASB issued ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory There are no other recently issued accounting pronouncements that the Company has yet to adopt that are expected to have a material effect on its financial position, results of operations, or cash flows. |
Going Concern
Going Concern | 6 Months Ended |
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern | Note 2 – Going Concern As shown in the accompanying condensed consolidated financial statements, the Company has incurred recurring losses from operations resulting in an accumulated deficit of ($10,781,291), and as of March 31, 2017, the Company’s cash on hand may not be sufficient to sustain operations. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management is actively pursuing new customers to increase revenues. In addition, the Company is currently seeking additional sources of capital to fund short term operations. Management believes these factors will contribute toward achieving profitability. The accompanying consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of any uncertainty as to the Company’s ability to continue as a going concern. These financial statements also do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern. |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Mar. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 3 – Related Party Transactions Stock Based Compensation for Services On March 1, 2017, we issued 25,000 shares of common stock to our CFO as a bonus for services rendered. The aggregate fair value of the common stock was $6,623 based on the closing price of the Company’s common stock on the date of grant, and was expensed in full. On February 22, 2017, we issued 100,000 shares of common stock to Dr. Alfredo Axtmayer in connection with his appointment to our Board of Directors. The aggregate fair value of the common stock was $34,000 based on the closing price of the Company’s common stock on the date of grant, and was expensed in full. On January 1, 2016, we issued 500,000 shares of common stock to an entity owned by our CEO as compensation for board services rendered during the 2016 calendar year. The aggregate fair value of the common stock was $70,000 based on the closing price of the Company’s common stock on the date of grant, and was expensed in ratably over the requisite service period, resulting in $17,500 of stock based compensation expense during the six months ended March 31, 2017. On June 21, 2016, we granted options to purchase 4,750,000 shares of common stock as compensation for services to our CEO. The options are exercisable over a ten year period at an exercise price of $0.20 per share, and 50% vest immediately, with 25% vesting each year thereafter. The estimated value using the Black-Scholes Pricing Model, based on a volatility rate of 230% and a call option value of $0.1986, was $943,193. The options are being expensed over the vesting period, resulting in $117,900 of stock based compensation expense during the six months ended March 31, 2017. On June 21, 2016, we granted options to purchase 2,500,000 shares of common stock as compensation for services to our President and COO. The options are exercisable over a ten year period at an exercise price of $0.20 per share, and 50% vest immediately, with 25% vesting each year thereafter. The estimated value using the Black-Scholes Pricing Model, based on a volatility rate of 230% and a call option value of $0.1986, was $496,417. The options are being expensed over the vesting period, resulting in $62,052 of stock based compensation expense during the six months ended March 31, 2017. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 6 Months Ended |
Mar. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Note 4 – Fair Value of Financial Instruments Under FASB ASC 820-10-5, 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 (an exit price). The standard outlines a valuation framework and creates a fair value hierarchy in order to increase the consistency and comparability of fair value measurements and the related disclosures. Under GAAP, certain assets and liabilities must be measured at fair value, and FASB ASC 820-10-50 details the disclosures that are required for items measured at fair value. The Company has certain financial instruments that must be measured under the new fair value standard. The Company’s financial assets and liabilities are measured using inputs from the three levels of the fair value hierarchy. The three levels are as follows: Level 1 - Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. Level 2 - Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs). Level 3 - Unobservable inputs that reflect our assumptions about the assumptions that market participants would use in pricing the asset or liability. The following schedule summarizes the valuation of financial instruments at fair value on a recurring basis in the balance sheets as of March 31, 2017 and September 30, 2016, respectively: Fair Value Measurements at March 31, 2017 Level 1 Level 2 Level 3 Assets Cash $ 277,560 $ - $ - Available-for-sale securities 15,720 - - Total assets 293,280 - - Liabilities Total liabilities - - - $ 293,280 $ - $ - Fair Value Measurements at September 30, 2016 Level 1 Level 2 Level 3 Assets Cash $ 135,390 $ - $ - Available-for-sale securities 9,200 - - Total assets 144,590 - - Liabilities Total liabilities - - - $ 144,590 $ - $ - The fair value of our intellectual properties are deemed to approximate book value, and are considered Level 3 inputs as defined by ASC Topic 820-10-35. There were no transfers of financial assets or liabilities between Level 1, Level 2 and Level 3 inputs for the six months ended March 31, 2017 or the year ended September 30, 2016. |
Accounts Receivable
Accounts Receivable | 6 Months Ended |
Mar. 31, 2017 | |
Receivables [Abstract] | |
Accounts Receivable | Note 5 – Accounts Receivable Accounts receivable was $166,964 and $98,441 at March 31, 2017 and September 30, 2016, respectively, net of allowance for doubtful accounts of $18,754 and $-0- at March 31, 2017 and September 30, 2016, respectively. |
Fixed Assets
Fixed Assets | 6 Months Ended |
Mar. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Fixed Assets | Note 6 – Fixed Assets Fixed assets consist of the following at March 31, 2017 and September 30, 2016: March 31, 2017 September 30, 2016 Software $ 121,617 $ 121,617 Office equipment 36,080 36,080 Furniture and fixtures 2,357 2,357 Lab equipment 814,393 811,623 Leasehold improvements 487,066 487,066 1,461,513 1,458,743 Less: accumulated depreciation (442,068 ) (318,995 ) Total $ 1,019,445 $ 1,139,748 On October 1, 2015, we disposed of fixed assets with a net book value of $3,122 pursuant to the deconsolidation of Digipath Corp. The fixed assets consisted of furniture and fixtures with a historical cost basis of $48,779 and software with a historical cost basis of $10,019, and accumulated depreciation of $48,779 and $6,897, respectively. No gain or loss was recognized on the disposals. Depreciation and amortization expense totaled $123,073 and $122,230 for the six months ended March 31, 2017 and 2016, respectively. |
Available-for-Sale Securities
Available-for-Sale Securities | 6 Months Ended |
Mar. 31, 2017 | |
Schedule of Investments [Abstract] | |
Available-for-Sale Securities | Note 7 – Available-for-Sale Securities Available-for-sale securities consist of the following at March 31, 2017 and September 30, 2016: For the Six Months Ended March 31, 2017 Gains in Losses in Accumulated Accumulated Other Other Estimated Amortized Comprehensive Comprehensive Fair Cost Loss Loss Value Common stock $ 50,000 - $ (34,280 ) $ 15,720 Total available-for-sale securities $ 50,000 - $ (34,280 ) $ 15,720 For the Year Ended September 30, 2016 Gains in Losses in Accumulated Accumulated Other Other Estimated Amortized Comprehensive Comprehensive Fair Cost Loss Loss Value Common stock $ 50,000 - $ (40,800 ) $ 9,200 Total available-for-sale securities $ 50,000 - $ (40,800 ) $ 9,200 Common stock consisted of 400,000 shares of common stock of Blue Line Protection Group, Inc., a Nevada corporation, acquired in March of 2015 for $50,000. |
Changes in Stockholders' Equity
Changes in Stockholders' Equity | 6 Months Ended |
Mar. 31, 2017 | |
Equity [Abstract] | |
Changes in Stockholders' Equity | Note 8 - Changes in Stockholders’ Equity Convertible Preferred Stock The Company is authorized to issue 10,000,000 shares of preferred stock with a par value of $0.001 per share, of which 6,000,000 have been designated as Series A Convertible Preferred Stock (“Series A Preferred”). The Board of Directors is authorized to determine any number of series into which shares of preferred stock may be divided and to determine the rights, preferences, privileges and restrictions granted to any series of the preferred stock. As of March 31, 2017, there were 2,290,442 shares of Series A Preferred issued and outstanding. Shares of Series A Preferred are convertible into common stock at a fixed conversion rate of $0.20 per share. The conversion price is adjustable in the event of stock splits and other adjustments in the Company’s capitalization, and in the event of certain negative actions undertaken by the Company. At the current conversion price, the 2,290,442 shares of Series A Preferred outstanding at March 31, 2017 are convertible into 11,452,210 shares of the common stock of the Company. No holder is permitted to convert its shares of Series A Preferred if such conversion would cause the holder to beneficially own more than 4.99% of the issued and outstanding common stock of the Company immediately after such conversion, unless waived by such holder by providing at least sixty-five days’ notice. Preferred Stock Conversions During the six months ended March 31, 2017, a total of 1,230,000 Series A Preferred shares were converted into 6,150,000 shares of common stock. The stock was converted in accordance with the conversion terms; therefore no gain or loss has been recognized. Common Stock Common stock consists of $0.001 par value, 90,000,000 shares authorized, of which 30,754,616 shares were issued and outstanding as of March 31, 2017. Common Stock Sales On February 21, 2017, the Company sold 1,428,575 units, consisting of 1,428,575 shares of its common stock and 714,285 warrants, exercisable at $0.26 per share over a thirty six month period, in exchange for total proceeds of $250,000. The proceeds received were allocated between the common stock and warrants on a relative fair value basis. The warrants were assigned to two individuals by the purchaser at the time of the sale. Common Stock Issued for Services On March 1, 2017, the Company issued 25,000 shares of common stock to its CFO as a bonus for services rendered. The aggregate fair value of the common stock was $6,623 based on the closing price of the Company’s common stock on the date of grant, and was expensed in full. On March 1, 2017, the Company issued 50,000 shares of common stock to its Chief Scientist as a bonus for services rendered. The aggregate fair value of the common stock was $13,245 based on the closing price of the Company’s common stock on the date of grant, and was expensed in full. On February 23, 2017, the Company issued 100,000 shares of common stock to a consultant for services to be rendered over a six month period. The aggregate fair value of the common stock was $29,000 based on the closing price of the Company’s common stock on the date of grant, and is being expensed over the requisite service period. On February 22, 2017, the Company issued 100,000 shares of common stock to Dr. Alfredo Axtmayer in connection with his appointment to our Board of Directors. The aggregate fair value of the common stock was $34,000 based on the closing price of the Company’s common stock on the date of grant, and was expensed in full. On February 22, 2017, the Company issued 40,000 shares of common stock to a consultant for services rendered. The aggregate fair value of the common stock was $13,600 based on the closing price of the Company’s common stock on the date of grant, and was expensed in full. On February 7, 2017, a total of 370,000 shares of common stock were issued to six consultants that were engaged to assist the Company with acquisition activities over a six month period. The aggregate fair value of the common stock was $82,251 based on the closing price of the Company’s common stock on the date of grant, and is being expensed over the six month requisite service period. On January 1, 2016, an affiliate of Mr. Bianco, a director of the Company, became entitled to receive 500,000 shares of common stock for consulting services to be performed during 2016, subject to a ratable “claw back” provision the event of an early termination of the consulting agreement. The total fair value of the common stock was $70,000 based on the closing price of the Company’s common stock on the date of grant, and is being expensed over the twelve month requisite service period, resulting in $17,500 of stock based compensation during the period. A total of $123,028 of stock-based compensation expense was recognized from the amortization of common stock issued for services over the requisite service period during the six months ended March 31, 2017. Amortization of Stock Options A total of $199,820 of stock-based compensation expense was recognized from the amortization of options over their vesting period during the six months ended March 31, 2017. |
Common Stock Options
Common Stock Options | 6 Months Ended |
Mar. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Common Stock Options | Note 9 – Common Stock Options Stock Incentive Plan On June 21, 2016, we amended and restated our 2012 Stock Incentive Plan (the “2012 Plan”), which was originally adopted on March 5, 2012 and previously amended on May 20, 2014. As amended, the 2012 Plan provides for the issuance of up to 11,500,000 shares of common stock pursuant to the grant of options or other awards, including stock grants, to employees, officers or directors of, and consultants to, the Company and its subsidiaries. Options granted under the 2012 Plan may either be intended to qualify as incentive stock options under the Internal Revenue Code of 1986, or may be non-qualified options, and are exercisable over periods not exceeding ten years from date of grant. A total of 9,290,000 options were outstanding as of March 31, 2017. No options were granted or exercised during the six months ended March 31, 2017. On January 1, 2017, options to purchase 1,530 shares of common stock at $3.30 per share expired. |
Common Stock Warrants
Common Stock Warrants | 6 Months Ended |
Mar. 31, 2017 | |
Equity [Abstract] | |
Common Stock Warrants | Note 10 – Common Stock Warrants A total of 4,907,421 warrants were outstanding as of March 31, 2017. No warrants were exercised or expired during the six months ended March 31, 2017. Warrants to purchase a total of 714,285 shares of common stock at $0.26 per share over a 36 month period were issued on February 21, 2017 pursuant to a unit offering for the sale of 1,428,575 shares in exchange for proceeds of $250,000. The warrants were assigned to two individuals by the purchaser at the time of the sale. |
Other Income
Other Income | 6 Months Ended |
Mar. 31, 2017 | |
Other Income and Expenses [Abstract] | |
Other Income | Note 11 – Other Income Other income consists of rental income of $1,500 and $30,000 for the six months ended March 31, 2017 and 2016, respectively, for office and storage space subleased, along with $250,000 received from GB Sciences, Inc. during the six months ended March 31, 2017 pursuant to the settlement of a $300,000 license agreement with GB Sciences, Inc. In addition, we recognized $8,500 and $-0- of other income for the six months ended March 31, 2017 and 2016, respectively, related to restitution payments received from a former employee. |
Income Tax
Income Tax | 6 Months Ended |
Mar. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Tax | Note 12 - Income Tax The Company accounts for income taxes under FASB ASC 740-10, which requires use of the liability method. FASB ASC 740-10-25 provides that deferred tax assets and liabilities are recorded based on the differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes, referred to as temporary differences. For the six months ended March 31, 2017 and the year ended September 30, 2016, the Company incurred a net operating loss and, accordingly, no provision for income taxes has been recorded. In addition, no benefit for income taxes has been recorded due to the uncertainty of the realization of any tax assets. At March 31, 2017, the Company had approximately $6,839,000 of federal net operating losses. The net operating loss carry forwards, if not utilized, will begin to expire in 2031. Based on the available objective evidence, including the Company’s history of its loss, management believes it is more likely than not that the net deferred tax assets will not be fully realizable. Accordingly, the Company provided for a full valuation allowance against its net deferred tax assets at March 31, 2017 and September 30, 2016, respectively. In accordance with FASB ASC 740, the Company has evaluated its tax positions and determined there are no uncertain tax positions. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Mar. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 13 – Subsequent Events Preferred Stock Conversions On April 17, 2017, a shareholder converted 142,500 shares of Series A Preferred into 712,500 shares of common stock. The stock was converted in accordance with the conversion terms; therefore no gain or loss has been recognized. Common Stock Issued for Services On May 2, 2017, the Company issued 100,000 shares of common stock to Dr. John Abroon in connection with his appointment to our newly created Advisory Board. On May 2, 2017, the Company issued 140,000 shares of common stock to its new Director of Business Development in consideration of services rendered from April 1, 2017 through May 31, 2017. |
Organization, Basis of Presen19
Organization, Basis of Presentation and Significant Accounting Policies (Policies) | 6 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Organization | Organization Digipath, Inc. was incorporated in Nevada on October 5, 2010. Digipath, Inc. and its subsidiaries (“Digipath,” the “Company,” “we,” “our” or “us”) supports the cannabis industry’s best practices for reliable testing, cannabis education and training, and brings unbiased cannabis news coverage to the cannabis industry. Our business units are described below. ● Digipath Labs, Inc ● The National Marijuana News Corp |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). Intercompany accounts and transactions have been eliminated. The unaudited condensed consolidated financial statements of the Company and the accompanying notes included in this Quarterly Report on Form 10-Q are unaudited. In the opinion of management, all adjustments necessary for a fair presentation of the Condensed Consolidated Financial Statements have been included. Such adjustments are of a normal, recurring nature. The Condensed Consolidated Financial Statements, and the accompanying notes, are prepared in accordance with GAAP and do not contain certain information included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2016. The interim Condensed Consolidated Financial Statements should be read in conjunction with that Annual Report on Form 10-K. Results for the interim periods presented are not necessarily indicative of the results that might be expected for the entire fiscal year. |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts of the following entities, all of which were under common control and ownership at September 30, 2016: State of Name of Entity (1) Incorporation Relationship Digipath, Inc. (2) Nevada Parent Digipath Labs, Inc. Nevada Subsidiary TNM News, Inc. Nevada Subsidiary GroSciences, Inc. (3) Colorado Subsidiary (1) All entities are in the form of a corporation. (2) Holding company, which owns each of the wholly-owned subsidiaries. All subsidiaries shown above are wholly-owned by Digipath, Inc., the parent company. (3) Entity formed for prospective purposes, but has not incurred any income or expenses to date. The consolidated financial statements herein contain the operations of the wholly-owned subsidiaries listed above. All significant inter-company transactions have been eliminated in the preparation of these financial statements. The parent company and subsidiaries will be collectively referred to herein as the “Company”, “Digipath” or “DIGP”. The Company’s headquarters are located in Las Vegas, Nevada and substantially all of its customers are within the United States. These statements reflect all adjustments, consisting of normal recurring adjustments, which in the opinion of management are necessary for fair presentation of the information contained therein. |
Equity Method | Equity Method Investee companies that are not consolidated, but over which the Company exercises significant influence, are accounted for under the equity method of accounting. Whether or not the Company exercises significant influence with respect to an Investee depends on an evaluation of several factors including, among others, representation on the Investee company’s board of directors and ownership level, which is generally a 20% to 50% interest in the voting securities of the Investee company. Under the equity method of accounting, an Investee company’s accounts are not reflected within the Company’s Consolidated Balance Sheets and Statements of Operations; however, the Company’s share of the earnings or losses of the Investee company is reflected in the caption “Equity in losses of unconsolidated entity” in the Consolidated Statements of Operations. The Company’s carrying value in an equity method Investee company is reflected in the caption “Investment in Digipath Corp.” in the Company’s Consolidated Balance Sheets. As of March 31, 2017, our share of losses from the investee company exceeded our basis, therefore the investment is not currently presented on the balance sheet. U.S. GAAP considers a change in reporting entity to include “changing specific subsidiaries that make up the group of entities for which consolidated financial statements are presented.” Circumstances may arise where a parent’s controlling financial interest (e.g., generally an ownership interest in excess of 50 percent of the outstanding voting stock) is reduced to a noncontrolling investment that still enables it to exercise significant influence over the operating and financial policies of the investee. A change that results from changed facts and circumstances (such as a partial sale of a subsidiary), where there was only one acceptable method of accounting prior to the change in circumstances (consolidation) and only one acceptable method of accounting after the change (equity method accounting), is not a change in reporting entity and is not be accounted for retrospectively. Accordingly, a change from a controlling interest to a noncontrolling investment accounted for under the equity method is accounted for prospectively from the date of change in control. When the Company’s carrying value in an equity method Investee company is reduced to zero, no further losses are recorded in the Company’s consolidated financial statements unless the Company guaranteed obligations of the Investee company or has committed additional funding. When the Investee company subsequently reports income, the Company will not record its share of such income until it equals the amount of its share of losses not previously recognized. |
Segment Reporting | Segment Reporting ASC Topic 280, “Segment Reporting,” requires use of the “management approach” model for segment reporting. The management approach model is based on the way a company’s management organizes segments within the company for making operating decisions and assessing performance. The Company operates as a single segment and will evaluate additional segment disclosure requirements as it expands its operations. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Under FASB ASC 820-10-05, the Financial Accounting Standards Board establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosures about fair value measurements. This Statement reaffirms that fair value is the relevant measurement attribute. The adoption of this standard did not have a material effect on the Company’s financial statements as reflected herein. The carrying amounts of cash, accounts receivable, accounts payable and accrued expenses reported on the balance sheets are estimated by management to approximate fair value primarily due to the short term nature of the instruments. In addition, the Company had debt instruments that required fair value measurement on a recurring basis. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue in accordance with ASC 605, Revenue Recognition. ASC 605 requires that four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery of product has met the criteria established in the arrangement or services rendered; (3) the fee is fixed and determinable; and (4) collectability is reasonably assured. This occurs when the products or services are completed in accordance with the contracts we have with clients. In connection with our products and services arrangements, when we are paid in advance, these amounts are classified as deferred revenue and amortized over the term of the agreement. With respect to our cannabis lab testing revenues, we sell our services on a determinable fixed fee per test, or panel of tests basis, and offer a discounted price for customers that agree to enter into exclusive, long term contracts. We typically require payment within thirty days of the delivery of results. Revenues are recognized upon the substantial completion of the tests when collectability is reasonably assured, which is usually upon delivery of results to the customer. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for equity instruments issued to employees in accordance with the provisions of ASC 718 Stock Compensation (ASC 718) and Equity-Based Payments to Non-employees pursuant to ASC 505-50 (ASC 505-50). All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. The measurement date of the fair value of the equity instrument issued is the earlier of the date on which the counterparty’s performance is complete or the date at which a commitment for performance by the counterparty to earn the equity instruments is reached because of sufficiently large disincentives for nonperformance. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In January 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2017-04, Intangibles – Goodwill and Other (Topic 350) In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business In December 2016, the FASB issued ASU 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers Revenue from Contracts with Customers In October 2016, the FASB issued ASU No. 2016-17, Consolidation (Topic 810): Interests Held through Related Parties that are under Common Control In October 2016, the FASB issued ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory There are no other recently issued accounting pronouncements that the Company has yet to adopt that are expected to have a material effect on its financial position, results of operations, or cash flows. |
Organization, Basis of Presen20
Organization, Basis of Presentation and Significant Accounting Policies (Tables) | 6 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Schedule of Entities Under Common Control and Ownership | The accompanying consolidated financial statements include the accounts of the following entities, all of which were under common control and ownership at September 30, 2016: State of Name of Entity (1) Incorporation Relationship Digipath, Inc. (2) Nevada Parent Digipath Labs, Inc. Nevada Subsidiary TNM News, Inc. Nevada Subsidiary GroSciences, Inc. (3) Colorado Subsidiary (1) All entities are in the form of a corporation. (2) Holding company, which owns each of the wholly-owned subsidiaries. All subsidiaries shown above are wholly-owned by Digipath, Inc., the parent company. (3) Entity formed for prospective purposes, but has not incurred any income or expenses to date. |
Fair Value of Financial Instr21
Fair Value of Financial Instruments (Tables) | 6 Months Ended |
Mar. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Summary of Financial Instruments at Fair Value on Recurring Basis | The following schedule summarizes the valuation of financial instruments at fair value on a recurring basis in the balance sheets as of March 31, 2017 and September 30, 2016, respectively: Fair Value Measurements at March 31, 2017 Level 1 Level 2 Level 3 Assets Cash $ 277,560 $ - $ - Available-for-sale securities 15,720 - - Total assets 293,280 - - Liabilities Total liabilities - - - $ 293,280 $ - $ - Fair Value Measurements at September 30, 2016 Level 1 Level 2 Level 3 Assets Cash $ 135,390 $ - $ - Available-for-sale securities 9,200 - - Total assets 144,590 - - Liabilities Total liabilities - - - $ 144,590 $ - $ - |
Fixed Assets (Tables)
Fixed Assets (Tables) | 6 Months Ended |
Mar. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Fixed Assets | Fixed assets consist of the following at March 31, 2017 and September 30, 2016: March 31, 2017 September 30, 2016 Software $ 121,617 $ 121,617 Office equipment 36,080 36,080 Furniture and fixtures 2,357 2,357 Lab equipment 814,393 811,623 Leasehold improvements 487,066 487,066 1,461,513 1,458,743 Less: accumulated depreciation (442,068 ) (318,995 ) Total $ 1,019,445 $ 1,139,748 |
Available-for-Sale Securities (
Available-for-Sale Securities (Tables) | 6 Months Ended |
Mar. 31, 2017 | |
Schedule of Investments [Abstract] | |
Schedule of Available-for-Sale Securities | Available-for-sale securities consist of the following at March 31, 2017 and September 30, 2016: For the Six Months Ended March 31, 2017 Gains in Losses in Accumulated Accumulated Other Other Estimated Amortized Comprehensive Comprehensive Fair Cost Loss Loss Value Common stock $ 50,000 - $ (34,280 ) $ 15,720 Total available-for-sale securities $ 50,000 - $ (34,280 ) $ 15,720 For the Year Ended September 30, 2016 Gains in Losses in Accumulated Accumulated Other Other Estimated Amortized Comprehensive Comprehensive Fair Cost Loss Loss Value Common stock $ 50,000 - $ (40,800 ) $ 9,200 Total available-for-sale securities $ 50,000 - $ (40,800 ) $ 9,200 |
Organization, Basis of Presen24
Organization, Basis of Presentation and Significant Accounting Policies (Details Narrative) | 6 Months Ended |
Mar. 31, 2017Segments | |
Number of reportable segment | 1 |
Minimum [Member] | |
Percentage of equity method interest | 20.00% |
Maximum [Member] | |
Percentage of equity method interest | 50.00% |
Organization, Basis of Presen25
Organization, Basis of Presentation and Significant Accounting Policies - Schedule of Entities Under Common Control and Ownership (Details) - Entities Under Common Control and Ownership [Member] | 12 Months Ended | |
Sep. 30, 2016 | ||
Name of Entity | Digipath, Inc. | [1] |
State of Incorporation | Nevada | [2] |
Relationship | Parent | [2] |
Name of Entity | Digipath Labs, Inc. | [1] |
State of Incorporation | Nevada | |
Relationship | Subsidiary | |
Name of Entity | TNM News, Inc. | [1] |
State of Incorporation | Nevada | |
Relationship | Subsidiary | |
Name of Entity | GroSciences, Inc. | [1] |
State of Incorporation | Colorado | [3] |
Relationship | Subsidiary | [3] |
[1] | All entities are in the form of a corporation. | |
[2] | Holding company, which owns each of the wholly-owned subsidiaries. All subsidiaries shown above are wholly-owned by Digipath, Inc., the parent company. | |
[3] | Entity formed for prospective purposes, but has not incurred any income or expenses to date. |
Going Concern (Details Narrativ
Going Concern (Details Narrative) - USD ($) | Mar. 31, 2017 | Sep. 30, 2016 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accumulated deficit | $ (10,781,291) | $ (10,431,531) |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | Mar. 02, 2017 | Feb. 22, 2017 | Jan. 02, 2017 | Jun. 21, 2016 | Jan. 02, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | Feb. 21, 2017 |
Stock based compensation expense | $ 64,905 | $ 38,480 | ||||||
Number of warrants to purchase of common stock shares | 1,530 | |||||||
Common stock exercise price | $ 0.26 | |||||||
Chief Executive Officer [Member] | ||||||||
Common stock exercise price | $ 0.20 | |||||||
Call option value | $ 0.1986 | |||||||
CFO [Member] | ||||||||
Number of common stock shares issued for compensation | 25,000 | |||||||
Stock option value | $ 6,623 | |||||||
Fair value of common stock on the date of grant | $ 6,623 | |||||||
Dr. Alfredo Axtmayer [Member] | ||||||||
Number of common stock shares issued for compensation | 100,000 | |||||||
Stock option value | $ 34,000 | |||||||
Fair value of common stock on the date of grant | $ 34,000 | |||||||
Chief Executive Officer [Member] | ||||||||
Number of common stock shares issued for compensation | 500,000 | |||||||
Stock option value | $ 943,193 | $ 70,000 | ||||||
Stock based compensation expense | $ 17,500 | |||||||
Number of warrants to purchase of common stock shares | 4,750,000 | |||||||
Options exercisable description | The options are exercisable over a ten year period | |||||||
Percentage of options vested immediately | 50.00% | |||||||
Percentage of options vested thereafter | 25.00% | |||||||
Fair value measurements, volatility rate | 230.00% | |||||||
Chief Executive Officer [Member] | Joseph J. Bianco [Member] | ||||||||
Stock based compensation expense | 117,900 | |||||||
President and COO [Member] | ||||||||
Stock option value | $ 496,417 | |||||||
Stock based compensation expense | $ 62,052 | |||||||
Number of warrants to purchase of common stock shares | 2,500,000 | |||||||
Options exercisable description | The options are exercisable over a ten year period | |||||||
Common stock exercise price | $ 0.20 | |||||||
Percentage of options vested immediately | 50.00% | |||||||
Percentage of options vested thereafter | 25.00% | |||||||
Fair value measurements, volatility rate | 230.00% | |||||||
Call option value | $ 0.1986 |
Fair Value of Financial Instr28
Fair Value of Financial Instruments - Summary of Financial Instruments at Fair Value on Recurring Basis (Details) - USD ($) | Mar. 31, 2017 | Sep. 30, 2016 |
Level 1 [Member] | ||
Cash | $ 277,560 | $ 135,390 |
Available-for-sale securities | 15,720 | 9,200 |
Assets | 293,280 | 144,590 |
Total liabilities | ||
Total | 293,280 | 144,590 |
Level 2 [Member] | ||
Cash | ||
Available-for-sale securities | ||
Assets | ||
Total liabilities | ||
Total | ||
Level 3 [Member] | ||
Cash | ||
Available-for-sale securities | ||
Assets | ||
Total liabilities | ||
Total |
Accounts Receivable (Details Na
Accounts Receivable (Details Narrative) - USD ($) | Mar. 31, 2017 | Sep. 30, 2016 |
Receivables [Abstract] | ||
Accounts receivable | $ 166,964 | $ 98,441 |
Allowance for doubtful accounts | $ 18,754 | $ 0 |
Fixed Assets (Details Narrative
Fixed Assets (Details Narrative) - USD ($) | 6 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Oct. 02, 2016 | |
Fixed assets book value | $ 3,122 | ||
Gain or loss recognized on disposals | |||
Depreciation and amortization expense | $ 123,073 | $ 122,230 | |
Furniture and Fixtures [Member] | |||
Fixed assets historical cost basis | 48,779 | ||
Fixed assets accumulated depreciation and amortization | 48,779 | ||
Software [Member] | |||
Fixed assets historical cost basis | 10,019 | ||
Fixed assets accumulated depreciation and amortization | $ 6,897 |
Fixed Assets - Schedule of Fixe
Fixed Assets - Schedule of Fixed Assets (Details) - USD ($) | Mar. 31, 2017 | Sep. 30, 2016 |
Property, Plant and Equipment [Abstract] | ||
Software | $ 121,617 | $ 121,617 |
Office equipment | 36,080 | 36,080 |
Furniture and fixtures | 2,357 | 2,357 |
Lab equipment | 814,393 | 811,623 |
Leasehold improvements | 487,066 | 487,066 |
Fixed Assets, Gross | 1,461,513 | 1,458,743 |
Less: accumulated depreciation | (442,068) | (318,995) |
Total | $ 1,019,445 | $ 1,139,748 |
Available-for-Sale Securities32
Available-for-Sale Securities (Details Narrative) - Blue Line Protection Group, Inc [Member] | 1 Months Ended |
Mar. 31, 2015USD ($)shares | |
Number of common stock shares acquire during the period | shares | 400,000 |
Number of common stock share value acquired during the period | $ | $ 50,000 |
Available-for-Sale Securities -
Available-for-Sale Securities - Schedule of Available-for-Sale Securities (Details) - USD ($) | Mar. 31, 2017 | Sep. 30, 2016 |
Common stock | $ 15,720 | $ 9,200 |
Total available-for-sale securities | 15,720 | 9,200 |
Amortized Cost [Member] | ||
Common stock | 50,000 | 50,000 |
Total available-for-sale securities | 50,000 | 50,000 |
Gains In Accumulated Other Comprehensive Loss [Member] | ||
Common stock | ||
Total available-for-sale securities | ||
Losses In Accumulated Other Comprehensive Loss [Member] | ||
Common stock | (34,280) | (40,800) |
Total available-for-sale securities | $ (34,280) | $ (40,800) |
Changes in Stockholders' Equi34
Changes in Stockholders' Equity (Details Narrative) - USD ($) | Mar. 02, 2017 | Feb. 23, 2017 | Feb. 22, 2017 | Feb. 21, 2017 | Feb. 07, 2017 | Jan. 02, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | Sep. 30, 2016 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | |||||||
Preferred stock, par value | $ 0.001 | $ 0.001 | |||||||
Preferred stock, shares issued | 2,290,442 | 3,520,442 | |||||||
Preferred stock, shares outstanding | 2,290,442 | 3,520,442 | |||||||
Common stock par value | $ 0.001 | $ 0.001 | |||||||
Common stock authorized | 90,000,000 | 90,000,000 | |||||||
Common stock, shares issued | 30,754,616 | 22,491,041 | |||||||
Common Stock, shares outstanding | 30,754,616 | 22,491,041 | |||||||
Number of common stock sold | 1,428,575 | ||||||||
Number of warrant shares | 714,285 | ||||||||
Sale of stock price per share | $ 0.26 | ||||||||
Proceeds from issuance of common stock | $ 250,000 | $ 250,000 | $ 357,500 | ||||||
Stock-based compensation expense | 199,820 | ||||||||
Consultants [Member] | |||||||||
Stock issued for services | 100,000 | 40,000 | 500,000 | ||||||
Common stock issued for services | $ 29,000 | $ 13,600 | $ 70,000 | ||||||
Stock-based compensation expense | $ 17,500 | ||||||||
Six Consultants [Member] | |||||||||
Stock issued for services | 370,000 | ||||||||
Common stock issued for services | $ 82,251 | ||||||||
CFO [Member] | |||||||||
Stock issued for services | 25,000 | ||||||||
Common stock issued for services | $ 6,623 | ||||||||
Chief Scientist [Member] | |||||||||
Stock issued for services | 50,000 | ||||||||
Common stock issued for services | $ 13,245 | ||||||||
Dr. Alfredo Axtmayer [Member] | |||||||||
Stock issued for services | 100,000 | ||||||||
Common stock issued for services | $ 34,000 | ||||||||
Common Stock [Member] | |||||||||
Number of common stock sold | 1,428,575 | ||||||||
Stock-based compensation expense | $ 123,028 | ||||||||
Series A Convertible Preferred Stock [Member] | |||||||||
Preferred stock, shares designated | 6,000,000 | ||||||||
Series A Preferred Stock [Member] | |||||||||
Preferred stock, shares issued | 2,290,442 | ||||||||
Preferred stock, shares outstanding | 2,290,442 | ||||||||
Preferred stock convertible into common stock at fixed conversion price per share | $ 0.20 | ||||||||
Preferred stock convertible into common stock shares | 11,452,210 | ||||||||
Percentage of equity beneficial ownership | 4.99% | ||||||||
Stock conversion, shares converted | 1,230,000 | ||||||||
Stock conversion, shares issued | 6,150,000 |
Common Stock Options (Details N
Common Stock Options (Details Narrative) - $ / shares | Jan. 02, 2017 | Jun. 21, 2012 | Mar. 31, 2017 |
Number of options outstanding | 9,290,000 | ||
Number of options granted | 1,530 | ||
Number of options exercised | |||
Stock option exercise price per share | $ 3.30 | ||
2012 Stock Incentive Plan [Member] | |||
Number of shares issued under stock plan | 11,500,000 |
Common Stock Warrants (Details
Common Stock Warrants (Details Narrative) - USD ($) | Feb. 21, 2017 | Mar. 31, 2017 |
Number of warrant for sale | 714,285 | |
Warrant [Member] | ||
Number of warrants outstanding | 714,285 | 4,907,421 |
Number of warrants | ||
Number of warrants exercised | ||
Number of warrants expired | ||
Warrant price per share | $ 0.26 | |
Warrant term | 36 months | |
Number of warrant for sale | 1,428,575 | |
Proceeds from issuance of warrant | $ 250,000 |
Other Income (Details Narrative
Other Income (Details Narrative) - USD ($) | 6 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Monthly fee | $ 250,000 | |
Former Employee [Member] | ||
Other income | 8,500 | $ 0 |
GB Sciences [Member] | ||
Rental income | 1,500 | $ 30,000 |
GB Sciences [Member] | License Agreement [Member] | ||
Payment for settlement | $ 300,000 |
Income Tax (Details Narrative)
Income Tax (Details Narrative) | 6 Months Ended |
Mar. 31, 2017USD ($) | |
Income Tax Disclosure [Abstract] | |
Net operating loss carry forwards | $ 6,839,000 |
Operating loss expiration year | 2,031 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - Subsequent Event [Member] - shares | May 02, 2017 | Apr. 17, 2017 |
New Director of Business Development [Member] | ||
Number of common stock issued for services | 140,000 | |
Dr. John Abroon [Member] | ||
Number of common stock issued for services | 100,000 | |
Series A Preferred Stock [Member] | ||
Stock conversion, shares converted | 142,500 | |
Stock conversion, shares issued | 712,500 |