Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Apr. 13, 2021 | Jun. 30, 2020 | |
Details | |||
Registrant CIK | 0001514946 | ||
Fiscal Year End | --12-31 | ||
Document Type | 10-K/A | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2020 | ||
Document Transition Report | false | ||
Entity File Number | 000-54296 | ||
Entity Registrant Name | AXIM Biotechnologies, Inc. | ||
Entity Incorporation, State or Country Code | NV | ||
Entity Tax Identification Number | 27-4029386 | ||
Entity Address, Address Line One | 6191 Cornerstone Court | ||
Entity Address, Address Line Two | E, Suite 114 | ||
Entity Address, City or Town | San Diego | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 92121 | ||
Entity Address, Address Description | Address of principal executive offices | ||
Phone Fax Number Description | Registrant’s telephone number, including area code | ||
City Area Code | 858 | ||
Local Phone Number | 923-4422 | ||
Entity Listing, Par Value Per Share | $ 0.0001 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 5,861,569 | ||
Entity Common Stock, Shares Outstanding | 128,860,100 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 | |
Current assets: | |||
Cash | $ 457,181 | $ 511,630 | |
Prepaid expenses | 255,923 | 77,606 | |
Marketable securities | 0 | 213,745 | |
Investment in Joint Venture | 0 | 0 | |
Current assets of discontinued operations | 0 | 836,147 | |
Total current assets | 713,104 | 1,639,128 | |
Property, Plant and Equipment, Net | 104,094 | 2,237 | |
Other Assets: | |||
Notes receivable- related party | 103,242 | 0 | |
Goodwill | 2,458,233 | 0 | |
Research in progress | 7,800,000 | 0 | |
Security deposit | 5,000 | 0 | |
Operating lease right-of-use asset | 130,722 | 0 | |
Other assets of discontinued operations | 0 | 50,534 | |
Total other assets | 10,497,197 | 50,534 | |
TOTAL ASSETS | 11,314,395 | 1,691,899 | |
Current liabilities: | |||
Accounts payable and accrued liabilities | 1,073,142 | 750,310 | |
Lease liability obligations | [1] | 53,851 | |
Due to shareholder | 180 | 5,000 | |
Due to first insurance funding | 25,369 | 42,121 | |
Promissory note (including accrued interest of $19,507 and $0, respectively)(see note 9) | [2] | 343,725 | 0 |
Due to/from Axim/Sapphire | 0 | 0 | |
Due to/from Sapphire Bio/Sapphire Diagnostic | 0 | 0 | |
Current liabilities of discontinued operations | 0 | 2,598,000 | |
Total current liabilities | 1,496,267 | 3,395,431 | |
Long-term liabilities: | |||
Deferred tax liability | 2,340,000 | 0 | |
Convertible note payable - related party (including accrued interest of $158,648 and $93,333, respectively) | 4,158,648 | 4,093,333 | |
Convertible note payable - shareholder (including accrued interest of $0 and $5,578, respectively) | 0 | 50,578 | |
Lease liability obligation | [1] | 76,871 | 0 |
Other liabilities of discontinued operations | 0 | 0 | |
Total long-term liabilities | 8,252,307 | 5,056,865 | |
TOTAL LIABILITIES | 9,748,574 | 8,452,296 | |
STOCKHOLDERS' DEFICIT | |||
Common Stock, Value, Issued | 12,533 | 6,485 | |
Additional paid in capital | 43,201,186 | 28,623,060 | |
Common stock, to be issued | 201,974 | 50,000 | |
Accumulated deficit | (41,849,922) | (35,440,042) | |
TOTAL STOCKHOLDERS' DEFICIT | 1,565,821 | (6,760,397) | |
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT | 11,314,395 | 1,691,899 | |
Series B Convertible Preferred Stock | |||
STOCKHOLDERS' DEFICIT | |||
Preferred Stock, Value, Issued | 0 | 50 | |
Series C Convertible Preferred Stock | |||
STOCKHOLDERS' DEFICIT | |||
Preferred Stock, Value, Issued | 50 | 50 | |
Convertible note payable | |||
Long-term liabilities: | |||
Convertible note payable (including accrued interest of $236,148 and $168,208, respectively) net of unamortized debt discount of $843,673 and $739,732, respectively(see note 12) | [3] | $ 1,676,788 | $ 912,954 |
[1] | See note 17. | ||
[2] | See Note 9. | ||
[3] | See Note 12. |
Consolidated Balance Sheets - P
Consolidated Balance Sheets - Parenthetical - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 | |
Preferred Stock, Shares Issued | 300,000,000 | ||
Preferred Stock, Shares Outstanding | 300,000,000 | ||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | |
Common Stock, Shares, Issued | 125,327,579 | 64,854,539 | |
Common Stock, Shares, Outstanding | 125,327,579 | 64,854,539 | |
Preferred Stock | |||
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | |
Preferred Stock, Shares Authorized | 5,000,000 | 5,000,000 | |
Series B Convertible Preferred Stock | |||
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | |
Preferred Stock, Shares Authorized | 500,000 | 500,000 | |
Preferred Stock, Shares Issued | 500,000 | 500,000 | |
Preferred Stock, Shares Outstanding | 0 | 500,000 | |
Series C Convertible Preferred Stock | |||
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | |
Preferred Stock, Shares Authorized | 500,000 | 500,000 | |
Preferred Stock, Shares Issued | 500,000 | 500,000 | |
Preferred Stock, Shares Outstanding | 500,000 | 500,000 | |
Promissory note - related party | |||
Interest Payable, Current | $ 19,507 | $ 0 | |
Convertible note payable | |||
Interest Payable, Current | [1] | 236,148 | 168,208 |
~ | [1] | $ 843,673 | $ 739,732 |
[1] | See note 12. |
Consolidated Statement of Opera
Consolidated Statement of Operations - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Details | ||
Revenues | $ 0 | |
Cost of goods sold | 0 | $ 0 |
Gross profit | 0 | 0 |
Research and development expenses | 426,708 | 0 |
Selling, general and administrative | 4,506,289 | 3,105,482 |
Depreciation | 16,001 | 3,356 |
Total operating expenses from continuing operations | 4,948,998 | 3,108,838 |
Gain (Loss) from continuing operations | (4,948,998) | (3,108,838) |
Other (income) expenses: | ||
Income from Impression Healthcare Ltd | 0 | (57,400) |
Interest income | (675) | 0 |
Income form Grants from Government | (115,899) | 0 |
Unrealized gain (loss) on marketable securities | 104,705 | (113,748) |
Realized gain (loss) on marketable securities | 109,040 | (268,274) |
Loss on extinguishment/conversion of debt | 923,605 | 0 |
Amortization of note discount | 86,059 | 75,272 |
Interest expense | 234,754 | 222,236 |
Total other (income) expenses | 1,341,589 | (141,914) |
Loss before provision of income tax | (6,290,587) | (2,966,924) |
Provision for income tax | 0 | 0 |
Income(loss) from continuing operations | (6,290,587) | (2,966,924) |
Income(loss) from discontinued operations | (119,293) | (3,480,633) |
Net Income (Loss) Attributable to Parent | (6,409,880) | (6,447,557) |
NET LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS | $ (6,409,880) | $ (6,447,557) |
Income (Loss) from Continuing Operations, Per Basic Share | $ (0.06) | $ (0.05) |
Income (Loss) from Continuing Operations, Per Diluted Share | (0.06) | (0.05) |
Income (Loss) from Discontinued Operations and Disposal of Discontinued Operations, Net of Tax, Per Basic Share | 0 | (0.06) |
Income (Loss) from Discontinued Operations and Disposal of Discontinued Operations, Net of Tax, Per Diluted Share | 0 | (0.06) |
Earnings Per Share, Basic | (0.06) | (0.10) |
Earnings Per Share, Diluted | $ (0.06) | $ (0.10) |
Weighted average common shares outstanding - basic and diluted | 110,386,386 | 61,947,333 |
Consolidated Statement of Stock
Consolidated Statement of Stockholders' Deficit - USD ($) | Common Stock | Preferred Stock | Series A Convertible Preferred stock | Series B Convertible Preferred Stock | Series C Convertible Preferred Stock | Common stock to be issued | Additional Paid-in Capital | Retained Earnings | Total |
Equity Balance, Starting at Dec. 31, 2018 | $ 5,958 | $ 0 | $ 0 | $ 50 | $ 50 | $ 41,000 | $ 22,863,608 | $ (28,992,485) | $ (6,081,819) |
Shares Outstanding, Starting at Dec. 31, 2018 | 59,582,890 | 0 | 0 | 500,000 | 500,000 | ||||
Common stock to be issued for consultancy services, Value | $ 3 | $ 0 | $ 0 | $ 0 | $ 0 | (41,000) | 55,997 | 0 | 15,000 |
Common stock to be issued for consultancy services, Shares | 25,723 | 0 | 0 | 0 | 0 | ||||
Stock Issued During Period, Value, New Issues | $ 501 | $ 0 | $ 0 | $ 0 | $ 0 | 0 | 3,413,875 | 0 | 3,414,376 |
Stock Issued During Period, Shares, New Issues | 5,006,405 | 0 | 0 | 0 | 0 | ||||
Common stock issued against CS subcription received in PY, Value | $ 24 | $ 0 | $ 0 | $ 0 | $ 0 | 0 | 399,976 | 0 | 400,000 |
Common stock issued against CS subcription received in PY, Shares | 239,521 | 0 | 0 | 0 | 0 | ||||
Common stock to be issued per stock purchase agreement, Value | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | 50,000 | 0 | 0 | 50,000 |
Common stock to be issued per stock purchase agreement, Shares | 0 | 0 | 0 | 0 | 0 | ||||
Fair value of stock options, Value | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | 0 | 1,820,000 | 0 | 1,820,000 |
Fair value of stock options, Shares | 0 | 0 | 0 | 0 | 0 | ||||
Imputed interest on interest free loan from related party advances, Value | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | 0 | 69,604 | 0 | 69,604 |
Imputed interest on interest free loan from related party advances, Shares | 0 | 0 | 0 | 0 | 0 | ||||
Net Income (Loss) | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | 0 | 0 | (6,447,557) | (6,447,557) |
Shares Outstanding, Ending at Dec. 31, 2019 | 64,854,539 | 0 | 0 | 500,000 | 500,000 | ||||
Equity Balance, Ending at Dec. 31, 2019 | $ 6,486 | $ 0 | $ 0 | $ 50 | $ 50 | 50,000 | 28,623,060 | (35,440,042) | (6,760,397) |
Stock Issued During Period, Value, New Issues | $ 1,729 | $ 0 | $ 0 | $ 0 | $ 0 | 0 | 3,307,401 | 0 | 3,309,130 |
Stock Issued During Period, Shares, New Issues | 17,292,751 | 0 | 0 | 0 | 0 | ||||
Common stock to be issued for Note receivable and True-up adjustment, Value | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | 201,974 | 0 | 0 | 201,974 |
Common stock to be issued for Note receivable and True-up adjustment, Shares | 0 | 0 | 0 | 0 | 0 | ||||
Common stock issued against common stock to be issued received in PY, Value | $ 25 | $ 0 | $ 0 | $ 0 | $ 0 | (50,000) | 49,975 | 0 | 0 |
Common stock issued against common stock to be issued received in PY, Shares | 250,000 | 0 | 0 | 0 | 0 | ||||
Stock Issued During Period, Value, Issued for Services | $ 143 | $ 0 | $ 0 | $ 0 | $ 0 | 0 | 666,047 | 0 | 666,190 |
Stock Issued During Period, Shares, Issued for Services | 1,436,782 | 0 | 0 | 0 | 0 | ||||
Common stock issued for severance, Value | $ 93 | $ 0 | $ 0 | $ 0 | $ 0 | 0 | 479,907 | 0 | 480,000 |
Common stock issued for severance, Shares | 922,486 | 0 | |||||||
Subscription price adjustment, Value | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | 0 | (609,835) | 0 | (609,835) |
Subscription price adjustment, Shares | 0 | 0 | 0 | 0 | 0 | ||||
Beneficial conversion feature on the convertible note, Value | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | 0 | 190,000 | 0 | 190,000 |
Beneficial conversion feature on the convertible note, Shares | 0 | 0 | 0 | 0 | 0 | ||||
Common stock issued for acquisition, Value | $ 5,400 | $ 0 | $ 0 | $ 0 | $ 0 | 0 | 7,500,600 | 0 | 7,506,000 |
Common stock issued for acquisition, Shares | 54,000,000 | 0 | 0 | 0 | 0 | ||||
Retired common stock, Value | $ (1,857) | $ 0 | $ 0 | $ 0 | $ 0 | 0 | 0 | 0 | (1,857) |
Retired common stock, Shares | (18,570,356) | 0 | 0 | 0 | 0 | ||||
Series B preferred stock retirement, Value | $ 0 | $ 0 | $ 0 | $ (50) | $ 0 | 0 | 0 | 0 | (50) |
Series B preferred stock retirement, Shares | 0 | 0 | 0 | (500,000) | 0 | ||||
Convertible note and accrued interest converted to common stock, Value | $ 514 | $ 0 | $ 0 | $ 0 | $ 0 | 0 | 50,900 | 0 | 51,414 |
Convertible note and accrued interest converted to common stock, Shares | 5,141,377 | 0 | 0 | 0 | 0 | ||||
Stock based compensation - stock options, Value | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | 0 | 1,947,745 | 0 | 1,947,745 |
Stock based compensation - stock options, Shares | 0 | 0 | 0 | 0 | 0 | ||||
Loss on conversion of convertible note, Value | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | 0 | 823,497 | 0 | 823,497 |
Loss on conversion of convertible note, Shares | 0 | 0 | 0 | 0 | 0 | ||||
Loss on extinguishment of debt, Value | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | 0 | 171,889 | 0 | 171,889 |
Loss on extinguishment of debt, Shares | 0 | 0 | 0 | 0 | 0 | ||||
Net Income (Loss) | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | 0 | 0 | (6,409,880) | (6,409,880) |
Shares Outstanding, Ending at Dec. 31, 2020 | 125,327,579 | 0 | 0 | 0 | 500,000 | ||||
Equity Balance, Ending at Dec. 31, 2020 | $ 12,533 | $ 0 | $ 0 | $ 0 | $ 50 | $ 201,974 | $ 43,201,186 | $ (41,849,922) | $ 1,565,821 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (6,409,880) | $ (6,447,557) |
Less: Gain (Loss) from discontinued operations | (119,293) | (3,480,633) |
Loss from continuing operations | (6,290,587) | (2,966,924) |
Adjustments to reconcile net loss to cash used in operating activities: | ||
Depreciation | 16,001 | 3,356 |
Stock based compensation | 2,311,935 | 1,835,000 |
Amortization of prepaid expenses | 253,376 | 111,929 |
Amortization of debt discount | 86,059 | 75,272 |
Unrealized gain (loss) on marketable securities | 104,705 | (113,748) |
Realized gain (loss) on marketable securities | 109,040 | (268,274) |
Gain (Loss) on Extinguishment of Debt | 923,604 | (57,400) |
Changes in operating assets & liabilities: | ||
Increase (decrease) in interest receivable | (675) | 0 |
Increase (decrease) in prepaid expenses | (53,585) | (137,430) |
Increase (decrease) in accounts payable and accrued expenses | 532,245 | 153,740 |
Decrease in security deposits | 7,785 | 7,440 |
Net cash provided by (used in) operating activities from continuing operations | (2,000,097) | (1,357,039) |
Net cash provided by (used in) operating activities from discontinued operations | (1,215,602) | (3,681,944) |
Net cash provided by (used in) operating activities | (3,215,699) | (5,038,983) |
CASH FLOW FROM INVESTING ACTIVITIES: | ||
Investment in Joint Venture | 0 | |
Proceeds from Sales of Marketable Securities | 0 | 375,677 |
Cash acquired in acquisition | 79,814 | 0 |
Increase in property and equipment | (97,324) | 0 |
Net cash provided by (used in) investing activities from continuing operations | (17,510) | 375,677 |
Net cash provided by (used in) investing activities from discontinued operations | 27,490 | (27,490) |
Net cash provided by (used in) investing activities | 9,980 | 348,187 |
CASH FLOW FROM FINANCING ACTIVITIES: | ||
Repayment of convertible notes | 0 | (7,500) |
Common stock issued under registration statement on Form S-3 | 1,510,500 | 2,514,375 |
Common stock issued under SPA | 1,798,630 | 950,000 |
Repayment of First Insurance Funding | (92,860) | 18,841 |
Net cash provided by (used in) continuing financing activities | 3,216,270 | 3,475,716 |
Net cash provided by (used in) discontinued financing activities | (65,000) | (78,917) |
Net cash provided by (used in) financing activities | 3,151,270 | 3,396,799 |
Net increase (decrease) in cash and cash equivalents | (54,449) | (1,293,997) |
Comprehensive income (loss) | 0 | 0 |
Cash and cash equivalents at beginning of period | 511,630 | 1,805,627 |
Cash and cash equivalents at end of period | 457,181 | 511,630 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | ||
Interest | 0 | 60,278 |
Income taxes - net of tax refund | 0 | 0 |
NON-CASH INVESTING AND FINANCING ACTIVITIES | ||
Common stock issued against common stock to be issued | 50,000 | 56,000 |
Common stock issued against CS subscription | 0 | 400,000 |
Common stock issued for services recorded as prepaid expense | 302,000 | 0 |
Common stock issued for severance | 480,000 | 0 |
Shares issued for acquisition of Sapphire Biotechnology | 7,506,000 | 0 |
Deferred tax liability accounted for as a result of Sapphire Biotech Acquisition | 2,340,000 | 0 |
Assets acquired and liability assumed as a result of Sapphire Biotech Acquisition | 525,365 | 0 |
BCF related to discount on conversion | 190,000 | 0 |
Common stock issued for note receivable | 135,000 | 0 |
Adoption of lease obligation and ROU asset | 164,910 | 0 |
Common stock retired | 1,907 | 0 |
Convertible note issued against subscription price adjustment | 609,835 | 0 |
Convertible note converted to common stock | 51,414 | 0 |
Assets acquired as a result of Sapphire Biotech Acquisition | 33,319 | 0 |
Prepaid insurance paid through first insurance funding | 76,108 | 0 |
Others | $ 71,782 | $ 0 |
NOTE 1_ ORGANIZATION
NOTE 1: ORGANIZATION | 12 Months Ended |
Dec. 31, 2020 | |
Notes | |
NOTE 1: ORGANIZATION | NOTE 1: ORGANIZATION The Company was originally incorporated in Nevada on November 18, 2010, as Axim International Inc. On July 24, 2014, the Company changed its name to AXIM Biotechnologies, Inc. to better reflect its business operations. The Companys principal executive office is located at 45 Rockefeller Plaza 20th Floor, Suite 83, New York, NY 10111. On August 7, 2014, the Company formed a wholly owned Nevada subsidiary named Axim Holdings, Inc. This subsidiary will be used to help facilitate the anticipated activities planned by the Company. On May 11, 2015 the Company acquired a 100% interest in CanChew License Company a Nevada incorporated licensing Company, through the exchange of 5,826,706 shares of its common stock. In October 2017 the company formed a wholly owned subsidiary in the Netherlands for purposes of holding pharmaceutical licenses as required by the Netherlands regulations and laws. On October 16, 2018, the Company formed a wholly owned disregarded entity Marina Street, LLC as part of improvement of internal control over cash management and bank activities. On March 17, 2020, the Company acquired Sapphire Biotech, Inc., (Sapphire) which is r esearch and Development Company that has a mission to improve global cancer care through the development of proprietary therapeutics for inhibiting cancer growth and metastasis. Sapphire is also developing a line of novel diagnostics for early cancer detection, response to treatment, and recurrence monitoring. Sapphires operations are located in the Greater San Diego Area. Company Developments Divesture of Cannabis Related Assets On May 6, 2020 (the Effective Date), AXIM Biotechnologies, Inc., a Nevada corporation (the Company), entered into an Agreement (the Separation Agreement) by and among the Company, CanChew License Company (CanCo), CanChew Biotechnologies, LLC (CanChew), Medical Marijuana, Inc., Dr. George A. Anastassov (Dr. Anastassov), Dr. Philip A. Van Damme (Dr. Van Damme), Lekhram Changoer (Mr. Changoer), Sanammad Foundation, Netherlands and Sanammad Foundation, US (collectively, the Sanammad Parties), pursuant to which, among other matters as described herein, Drs. Anastassov and Van Damme and Mr. Changoer resigned as members of the Companys Board of Directors. Pursuant to the Separation Agreement, the Company transferred and assigned to an entity designated by Dr. Anastassov all of the Companys cannabis-related intellectual property other than the inventions and discoveries described in that certain cannabis-related patent application filed by the Companys wholly-owned subsidiary, Sapphire Biotech, Inc. (water-soluble cannabinoid molecules). The Company also transferred 100% of its interest in CanCo and CanChew to an entity designated by Dr. Anastassov. In consideration for the transfers set forth above, any and all indebtedness owed by the Company to CanChew, totaling approximately $2.61 million, was satisfied and paid in its entirety. In addition, in consideration for the payment by the Company of $65,000, the Company purchased 100% of the issued and outstanding shares of Series B Preferred Stock held by the Sanammad Parties. Such shares shall be retired to treasury of the Company. The Sanammad Parties also agreed to forfeit and assign back to treasury, for no consideration, a total of 18,570,356 shares of the Companys common stock. |
NOTE 2_ ACQUISITION OF SAPPHIRE
NOTE 2: ACQUISITION OF SAPPHIRE BIOTECH, INC | 12 Months Ended |
Dec. 31, 2020 | |
Notes | |
NOTE 2: ACQUISITION OF SAPPHIRE BIOTECH, INC | NOTE 2: ACQUISITION OF SAPPHIRE BIOTECH, INC. On March 17, 2020, the Company entered into a Share Exchange Agreement (Agreement) with Sapphire Biotech, Inc., a Delaware corporation (Sapphire) and all of the Sapphire stockholders (collectively, the Sapphire Stockholders). Following the closing of the transaction, Sapphire will become a wholly owned subsidiary of AXIM. Under the terms of the Agreement, the Company: (i) acquired 100% of Sapphires outstanding capital (consisting of 100,000,000 shares of common stock and zero (0) shares of Preferred Stock); and (ii) assume all of the outstanding debt of Sapphire. The outstanding debt includes two (2) convertible notes in the principal amounts of $310,000 and $190,000. Pursuant to the terms of the Share Exchange Agreement, the Company acquired 100% of the issued and outstanding shares of Sapphire by means of a share exchange with the Sapphire Stockholders in exchange for 54,000,000 newly issued shares of the common stock of AXIM (the Share Exchange). As a result of the Share Exchange, Sapphire became a 100% owned subsidiary of AXIM, which on a going forward basis will result in consolidated financial reporting by AXIM to include the results of Sapphire. The closing of the Share Exchange occurred concurrently with entry into the Share Exchange Agreement (the Closing). In March 2020, the Company acquired Sapphire Biotech, Inc., a biotechnology company focusing on improving cancer care through the development of proprietary therapeutics for inhibiting cancer growth and metastasis. The Company issued 54,000,000 shares of common stock with a total fair value of $7,506,000 and assumed net liabilities of $412,233 (resulting in a total acquisition cost of $7,918,233), in exchange for all outstanding shares of Sapphire Biotech, Inc. The Company accounted for the acquisition using the acquisition method of accounting for business combinations. On the acquisition date, the Company performed a preliminary allocation of the purchase price to include the tangible assets acquired and the liabilities assumed with the remainder of the purchase price allocated to patents pending approval, in-process research and development (IPR&D) and goodwill. The Company incurred $6,000 of acquisition-related costs, which will be recorded as expense after the evaluation work been completed. In addition, the Company recorded an estimated deferred tax liability on the assets acquired, except for goodwill for which deferred taxes are not applicable. The Company completed the valuation of the intangible assets acquired in the Sapphire Biotech, Inc. transaction by September 2020. Pursuant to the valuation, the Company determined that the patents continue to be expanded and chose to subsume the patents within the IPR&D balance. In managements judgment, the amount assigned to IPR&D represents the amount the Company would reasonably expect to pay an unrelated party for each project included in the technology. Based on the final valuation, the remaining excess purchase price has been allocated to goodwill. The aggregate purchase price of $7,918,233 consisted of common stock valued at $7,506,000 and the net liabilities assumed of $412,233. The value of the $7,506,000 of common shares issued was determined based on the closing price of the Companys common shares at the acquisition date. The following table summarizes the consideration paid for Sapphire and the estimated amounts of the assets acquired and liabilities assumed recognized at the acquisition date. Consideration: Cash and cash equivalents $ 79,814 Property and equipment, net 20,533 In process R&D 7,800,000 Goodwill 2,458,233 Security deposit 12,785 Total asset acquired $ 10,371,365 Accrued expenses and other current liabilities $ 5,767 Deferred taxes liability 2,340,000 Notes Payable including convertible and discount on conversion 519,598 Total liabilities assumed $ 2,865,365 Net assets acquired $ 7,506,000 The IPR&D and goodwill assets are not subject to amortization, and $2,340,000 was calculated as the deferred tax liability on the assets acquired, which amount was included in goodwill at the date of acquisition in accordance with accounting requirements. The $2,458,233 of goodwill is not expected to be deductible for tax purposes. The effective settlement of receivable/payable between the Company and Sapphire deemed to be not material, which was recorded as gain on intercompany transaction in P&L. Disclosure of Pro Forma Information The following (unaudited) pro forma consolidated results of operations have been prepared as if the acquisition of Sapphire Biotech, Inc. had occurred at January 1, 2019: For twelve months ended December 31, 2020 December 31, 2019 Revenues $ - $ - Net loss from continuing operations $ (6,716,906) $ (3,508,529) Net income (loss) from discontinued operations $ (119,293) $ (3,480,633) Net loss per shareBasic and Diluted $ (0.06) $ (0.10) The pro forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that actually would have been achieved had the acquisition been consummated as of that time, nor is it intended to be a projection of future results. During the twelve months ended December 31, 2020 Sapphire had no revenue transactions. |
NOTE 3_ BASIS OF PRESENTATION
NOTE 3: BASIS OF PRESENTATION | 12 Months Ended |
Dec. 31, 2020 | |
Notes | |
NOTE 3: BASIS OF PRESENTATION | NOTE 3: BASIS OF PRESENTATION: The consolidated financial statements of AXIM Biotechnologies, Inc. (formerly Axim International, Inc.) Principles of Consolidation The consolidated financial statements include the accounts of Axim Biotechnologies, Inc. and its wholly owned subsidiaries Axim Holdings, Inc., Marina Street LLC, Axim Biotechnologies (the Netherland Company) and Sapphire Biotech, Inc. The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant inter-company balances and transactions have been eliminated upon consolidation. |
NOTE 4_ GOING CONCERN
NOTE 4: GOING CONCERN | 12 Months Ended |
Dec. 31, 2020 | |
Notes | |
NOTE 4: GOING CONCERN | NOTE 4: GOING CONCERN The Companys consolidated financial statements have been presented assuming that the Company will continue as a going concern. As shown in the consolidated financial statements, the Company has negative working capital of $783,163 and has an accumulated deficit of $41,849,922 has cash used in operating activities of continuing operations $2,000,097. The Company extinguished its old debt and entered in debt exchange agreement. On April 16, 2018, the Company entered into a Stock Purchase Agreement and sold 1,945,000 shares of our common stock registered under the Registration Statement on Form S-3 declared effective by the Securities and Exchange Commission on September 14, 2017. On March 11, 2019 the company issued shares in accordance with an SPA dated August 1, 2018 which the amount reduced due to shareholder by $400,000. During the year ended December 31, 2020, the Company raised additional capital of $3,309,130 through Stock Purchase Agreements. This capital provides funds for research, development, and ongoing operations. The Company intends to raise substantial additional capital through private placements of debt and equity securities, but there can be no assurance that these funds will be available on terms acceptable to the Company or will be sufficient to enable the Company to fully complete its development activities or sustain operations. If the Company is unable to raise sufficient additional funds, it will have to develop and implement a plan to further extend payables, reduce overhead, or scale back its current business plan until sufficient additional capital is raised to support further operations. There can be no assurance that such a plan will be successful. That will raise a doubt about the ability of the Company to continue as a going concern. The consolidated |
NOTE 5_ SIGNIFICANT ACCOUNTING
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2020 | |
Notes | |
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES | NOTE 5: SIGNIFICANT ACCOUNTING POLICIES Use of estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements as well as the reported amounts of revenue and expenses during reporting periods. Actual results could differ from these estimates. Significant estimates are assumptions about collection of accounts receivable, useful life of intangible assets and assumptions used in Black-Scholes-Merton, or BSM, valuation methods, such as expected volatility, risk-free interest rate and expected dividend rate. Operating lease We lease property under various operating leases which are disclosed on our Balance sheet in accordance with ASC 842 Risks and uncertainties The Company operates in a dynamic and highly competitive industry and is subject to risks and uncertainties common to early-stage companies in the biotechnology industry, including, but not limited to, development by competitors of new technological innovations, protection of proprietary technology, dependence on key personnel, contract manufacturer and contract research organizations, compliance with government regulations and the need to obtain additional financing to fund operations. Product candidates currently under development will require significant additional research and development efforts, including extensive preclinical studies and clinical trials and regulatory approval, prior to commercialization. These efforts require significant amounts of additional capital, adequate personnel infrastructure and extensive compliance and reporting. The Company believes that changes in any of the following areas could have a material adverse effect on the Companys future financial position, results of operations, or cash flows; ability to obtain future financing; advances and trends in new technologies and industry standards; results of clinical trials; regulatory approval and market acceptance of the Companys products; development of sales channels; certain strategic relationships; litigation or claims against the Company based on intellectual property, patent, product, regulatory, or other factors; and the Companys ability to attract and retain employees necessary to support its growth. Products developed by the Company require approvals from the U.S. Food and Drug Administration (FDA) or other international regulatory agencies prior to commercial sales. There can be no assurance that the Companys research and development will be successfully completed, that adequate protection for the Companys intellectual property will be obtained or maintained, that the products will receive the necessary approvals, or that any approved products will be commercially viable. If the Company was denied approval, approval was delayed or the Company was unable to maintain approval, it could have a materially adverse impact on the Company. Even if the Companys product development efforts are successful, it is uncertain when, if ever, the Company will generate revenue from product sales. The Company operates in an environment of rapid change in technology and substantial competition from other pharmaceutical and biotechnology companies. In addition, the Company is dependent upon the services of its employees, consultants and other third parties. Beginning in late 2019, the outbreak of a novel strain of virus named SARS-CoV-2 (severe acute respiratory syndrome coronavirus 2), or coronavirus, which causes coronavirus disease 2019, or COVID-19, has evolved into a global pandemic. The extent of the impact of the coronavirus outbreak on the Companys business will depend on certain developments, including the duration and spread of the outbreak and the extent and severity of the impact on the Companys clinical trial activities, research activities and suppliers, all of which are uncertain and cannot be predicted. At this point, the extent to which the coronavirus outbreak may materially impact the Companys financial condition, liquidity or results of operations is uncertain. The Company has expended and will continue to expend substantial funds to complete the research, development and clinical testing of product candidates. The Company also will be required to expend additional funds to establish commercial-scale manufacturing arrangements and to provide for the marketing and distribution of products that receive regulatory approval. The Company may require additional funds to commercialize its products. The Company is unable to entirely fund these efforts with its current financial resources. If adequate funds are unavailable on a timely basis from operations or additional sources of financing, the Company may have to delay, reduce the scope of or eliminate one or more of its research or development programs which would materially and adversely affect its business, financial condition and operations. There have been no material changes in the accounting policies from those disclosed in the financial statements and the related notes included in the Form 10-K. Cash equivalents The Company considers all highly liquid investments with original maturities of three months or less at the time of purchase to be cash equivalents. As of December 31, 2020, the Company had no cash equivalents. Cash and cash equivalents are maintained at financial institutions and, at times, balances may exceed federally insured limits. The Company had no uninsured balances at December 31, 2020. The Company has never experienced any losses related to these balances. Accounts Receivable It is the Company's policy to review accounts receivable at least on a monthly basis for conductibility and follow up with customers accordingly. Covid19 has slowed collection as our customers are in a mandated pause. We do not have geographic concentration of customers. Concentrations At December 31, 2020, there was no accounts receivable. For the year ended December 31, 2020, one customer accounted for 21% of total revenue. For the year ended December 31, 2019, two customers accounted for 95% of total revenue. Revenue was all generated from discontinued operations for the twelve months ending December 31, 2020 and 2019. Inventory Inventory consists of finished goods available for sale and raw materials owned by the Company and are stated at the lower of cost or market. As of December 31, 2020 and 2019, the Company had $-0- and $175,304 of finished goods and $-0- and $312,511 of raw material, respectively. The Companys inventory relating to discontinued operations consisted of the following at December 31, 2020 and 2019, respectively. December 31, 2020 December 31, 2019 Finished goods $ - $ 175,304 Raw material $ - $ 312,511 $ - $ 487,815 Property and equipment Property and equipment are carried at cost less accumulated depreciation. Depreciation is computed using straight-line method over the estimated useful life. New assets and expenditures that extend the useful life of property or equipment are capitalized and depreciated. Expenditures for ordinary repairs and maintenance are charged to operations as incurred. The Companys property and equipment relating to continuing operations consisted of the following at December 31, 2020 and 2019, respectively, and none related to discontinued operations. December 31, 2020 December 31, 2019 Equipment of continuing operations $ 134,788 $ 16,780 Less: accumulated depreciation $ 30,694 $ 14,543 $ 104,094 $ 2,237 Intangible Assets As required by generally accepted accounting principles, trademarks and patents are amortized if they have a definite life, and not amortized if they have an indefinite life and then they are tested annually for impairment. The Companys intangible assets relating to continuing operations and discontinued operations consisted of the following at December 31, 2020 and 2019, respectively. December 31, 2020 December 31, 2019 Goodwill $ 2,458,233 $ - Research in progress 7,800,000 - $ 10,258,233 $ - Intangible assets of discontinued operations $ - $ 715,432 Less: accumulated amortization and impairment - 664,898 $ - $ 50,534 Revenue Recognition The Company follows the guidance contained in Topic 606 (FASB ASC 606). The core principle of Topic 606 (FASB ASC 606) is that an entity should recognize revenue to depict the transfer of goods of services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The revenue recognition guidance contained in Topic 606, to follow the five-step revenue recognition model along with other guidance impacted by this standard: (1) identify the contract with the customer; (2) identify the performance obligations in the contract; (3) determine the transportation price; (4) allocate the transportation price; (5) recognize revenue when or as the entity satisfies a performance obligation. All revenue was from operations that were divested. Revenues are recognized when title for goods is transferred; non-refundable fees and proceeds from irrevocable agreements recognized when inflows or other enhancements of assets of the Company are received. Revenues from continuing operations recognized for twelve months ended December 31, 2020 and 2019 amounted to $-0- and $-0-, respectively. Revenues from discontinued operations recognized for twelve months ended December 31, 2020 and 2019 amounted to $7,990 and $742,083, respectively. Derivative Liabilities The Company assessed the classification of its derivative financial instruments as of December 31, 2020, which consist of convertible instruments and rights to shares of the Companys common stock and determined that such derivatives meet the criteria for liability classification under ASC 815. ASC 815 generally provides three criteria that, if met, require companies to bifurcate conversion options from their host instruments and account for them as free standing derivative financial instruments. These three criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument subject to the requirement of ASC 815. ASC 815 also provides an exception to this rule when the host instrument is deemed to be conventional, as described. Fair Value Measurements The Company applies the guidance that is codified under ASC 820-10 related to assets and liabilities recognized or disclosed in the financial statements at fair value on a recurring basis. ASC 820-10 defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. The provisions of ASC 820-10 only apply to the Companys investment securities, which are carried at fair value. ASC 820-10 clarifies that fair value is an exit price, representing the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants based on the highest and best use of the asset or liability. As such, fair value is a market-based measurement that is determined based on assumptions that market participants would use in pricing an asset or liability. ASC 820-10 requires valuation techniques to measure fair value that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized as follows: Fair Value Hierarchy Inputs to Fair Value Methodology Level 1 Quoted prices in active markets for identical assets or liabilities Level 2 Quoted prices for similar assets or liabilities; quoted markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the financial instrument; inputs other than quoted prices that are observable for the asset or liability; or inputs that are derived principally from, or corroborated by, observable market information Level 3 Pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption is unobservable or when the estimation of fair value requires significant management judgment The Company categorizes a financial instrument in the fair value hierarchy based on the lowest level of input that is significant to its fair value measurement. As of December 31, 2020 Quoted Market Prices in Active Markets (Level 1) Internal Models with Significant Observable Market Parameters (Level 2) Internal Models with Significant Unobservable Market Parameters (Level 3) Total Fair Value Reported in Financial Statements Marketable Securities $- $- $- $- As of December 31, 2019 Quoted Market Prices in Active Markets (Level 1) Internal Models with Significant Observable Market Parameters (Level 2) Internal Models with Significant Unobservable Market Parameters (Level 3) Total Fair Value Reported in Financial Statements Marketable Securities $213,745 $- $- $213,745 For the twelve months ended December 31, 2020 and 2019 The Company recorded unrealized gain (loss) on marketable securities of $(104,705) and $113,748, respectively, and realized gain (loss) on marketable securities of $(109,040) and $268,274, respectively. These securities are classified as trading. The Company did not have any Level 2 or Level 3 assets or liabilities as of December 31, 2020, except for its convertible notes payable , in process Research and Development. The carrying amounts of these assets and liabilities at December 31, 2020 approximate their respective fair value based on the Companys incremental borrowing rate. Cash is as of December 31, 2020 and 2019 is classified as Level 1 within our fair value hierarchy. Convertible Instruments The Company evaluates and accounts for conversion options embedded in its convertible instruments in accordance with professional standards for Accounting for Derivative Instruments and Hedging Activities. Professional standards generally provide three criteria that, if met, require companies to bifurcate conversion options from their host instruments and account for them as free standing derivative financial instruments. These three criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instruments are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument. Professional standards also provide an exception to this rule when the host instrument is deemed to be conventional as defined under professional standards as The Meaning of Conventional Convertible Debt Instrument. The Company accounts for convertible instruments (when it has determined that the embedded conversion options should not be bifurcated from their host instruments) in accordance with professional standards when Accounting for Convertible Securities with Beneficial Conversion Features, as those professional standards pertain to Certain Convertible Instruments. Accordingly, the Company records, when necessary, discounts to convertible notes for the intrinsic value of conversion options embedded in debt instruments based upon the differences between the fair value of the underlying common stock at the commitment date of the note transaction and the effective conversion price embedded in the note. Debt discounts under these arrangements are amortized over the term of the related debt to their earliest date of redemption. The Company also records when necessary deemed dividends for the intrinsic value of conversion options embedded in preferred shares based upon the differences between the fair value of the underlying common stock at the commitment date of the note transaction and the effective conversion price embedded in the note. ASC 815-40 provides that, among other things, generally, if an event is not within the entitys control could or require net cash settlement, then the contract shall be classified as an asset or a liability. Income Taxes The Company follows Section 740-10, Income tax (ASC 740-10) Fair Value Measurements and Disclosures of the FASB Accounting Standards Codification, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the Statements of Operations in the period that includes the enactment date. The Company recognizes deferred tax assets to the extent that the Company believes that these assets are more likely than not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including reversals of any existing taxable temporary differences, projected future taxable income, tax planning strategies, and the results of recent operations. If the Company determines that it would be able to realize a deferred tax asset in the future in excess of any recorded amount, the Company would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes. The Company adopted section 740-10-25 of the FASB Accounting Standards Codification (Section 740-10-25). Section 740-10-25 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under Section 740-10-25, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate settlement. Section 740-10-25 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures. The Company had no liabilities for unrecognized income tax benefits according to the provisions of Section 740-10-25. Concentrations of Credit Risk Financial instruments and related items, which potentially subject the Company to concentrations of credit risk, consist primarily of cash and cash equivalents. The Company places its cash and temporary cash investments with credit quality institutions. At times, such amounts may be in excess of the FDIC insurance limit. The Company had $0 and $240,769 allowance for doubtful accounts at December 31, 2020 and 2019, respectively and had $0 accounts receivable at December 31, 2020 and $240,769 at December 31, 2019, all was related to discontinued operations. Net Loss per Common Share Net loss per common share is computed pursuant to section 260-10-45 Earnings Per Share (ASC 260-10) of the FASB Accounting Standards Codification. Basic net loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding and the member potentially outstanding during each period. In periods when a net loss is experienced, only basic net loss per share is calculated because to do otherwise would be anti-dilutive. There were common share equivalents 32,556,727 at December 31, 2020 and 16,295,498 at December 31, 2019. For the year ended December 31, 2020 and 2019 these potential shares were excluded from the shares used to calculate diluted earnings per share as their inclusion would reduce net loss per share. Stock Based Compensation All stock-based payments to employees and to nonemployee directors for their services as directors, including any grants of restricted stock and stock options, are measured at fair value on the grant date and recognized in the statements of operations as compensation or other expense over the relevant service period. Stock-based payments to nonemployees are recognized as an expense over the period of performance. Such payments are measured at fair value at the earlier of the date a performance commitment is reached, or the date performance is completed. In addition, for awards that vest immediately and are non-forfeitable the measurement date is the date the award is issued. The Company accounts for stock options issued to non-employees based on the estimated fair value of the awards using the Black-Scholes option pricing model in accordance with ASC 505-50, Equity-Based Payment to Non-employees Cost of Sales Cost of sales includes the purchase cost of products sold and all costs associated with getting the products to the customers including buying and transportation costs. Research and Development The Company accounts for research and development costs in accordance with the Accounting Standards Codification subtopic 730-10, Research and Development (ASC 730-10). Under ASC 730-10, all research and development costs must be charged to expense as incurred. Accordingly, internal research and development costs are expensed as incurred. Third-party research and development costs are expensed when the contracted work has been performed or as milestone results have been achieved. Company-sponsored research and development costs related to both present and future products are expensed in the period incurred. For the twelve months ended December 31, 2020 and 2019 The Company incurred research and development expenses of $426,708 and $-0- from continuing operations, respectively. For the twelve months ended December 31, 2020 and 2019 the Company incurred research and development expenses of $377,416 and $2,452,506 from discontinued operations, respectively. The Company has entered into various agreements with CROs. The Companys research and development accruals are estimated based on the level of services performed, progress of the studies, including the phase or completion of events, and contracted costs. The estimated costs of research and development provided, but not yet invoiced, are included in accrued liabilities on the balance sheet. If the actual timing of the performance of services or the level of effort varies from the original estimates, the Company will adjust the accrual accordingly. Payments made to CROs under these arrangements in advance of the performance of the related services are recorded as prepaid expenses and other current assets until the services are rendered. Shipping Costs Shipping and handling costs billed to customers are recorded in sales. Shipping costs incurred by the company are recorded in general and administrative expenses. Recently Issued Accounting Standards In March 2019, the FASB issued ASU 2019-01, Leases (Topic 842) Codification Improvements The Company has a long-term operating lease, and the long-term operating lease took effect in April 2020 (see note 17). In November 2018, the FASB issued ASU 2018-18 , Collaborative Arrangements (Topic 818): Clarifying the Interaction Between Topic 808 and Topic 606 In October 2018, the FASB issued ASU 2018-17, Targeted Improvements to Related Party Guidance for Variable Interest Entities In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customers Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract. In August 2018, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement Other recent accounting pronouncements issued by the FASB and the SEC did not or are not believed by management to have a material impact on the Companys present or future consolidated financial statements. |
NOTE 6_ PREPAID EXPENSES
NOTE 6: PREPAID EXPENSES | 12 Months Ended |
Dec. 31, 2020 | |
Notes | |
NOTE 6: PREPAID EXPENSES | NOTE 6: PREPAID EXPENSES Prepaid expenses consist of the following as of December 31, 2020 and 2019: December 31, 2020 December 31, 2019 Prepaid insurance $ 45,983 $ 67,734 Prepaid services/inventory 209,940 9,872 $ 255,923 $ 77,606 For the year ended December 31, 2020 and 2019 the Company recognized amortization of prepaid expense of $120,559 and $111,929, respectively. |
NOTE 7_ MARKETABLE SECURITIES
NOTE 7: MARKETABLE SECURITIES | 12 Months Ended |
Dec. 31, 2020 | |
Notes | |
NOTE 7: MARKETABLE SECURITIES | NOTE 7: MARKETABLE SECURITIES The Company received marketable securities, 10,300,000 fully paid ordinary unrestricted shares in Impression Healthcare Limited (Australian Company), traded on Australian Security Exchange by the code IHL as part of the agreement and letter of intent (LOI). As of December 31, 2019 the Company still had 4,925,000 shares. The Company categorize these securities as trading securities and report them at fair value, with unrealized gains and losses included in earnings. On December 31, 2019 the stock price was A$ 0.062 per share as quoted on asx.com.au and exchange rate of $0.7 AUD/USD as quoted on oanda.com and had FMV $213,745. On April 14, 2020 the Company entered into deed of settlement and release with Impression Healthcare Limited and transferred 4,925,000 held shares back to Impression Healthcare Limited by way of sale and purchase, with the total amount payable by Impression Healthcare Limited to Axim for completion of the sale and purchase and transfer being the aggregate amount of $1. During the twelve months ended December 31, 2020 and 2019 The Company recorded unrealized gain (loss) on marketable securities of $(104,705) and $113,748, respectively, and realized gain (loss) on marketable securities of $(109,040) and $268,274, respectively. |
NOTE 8_ INVESTMENT IN JOINT VEN
NOTE 8: INVESTMENT IN JOINT VENTURE-RELATED PARTY | 12 Months Ended |
Dec. 31, 2020 | |
Notes | |
NOTE 8: INVESTMENT IN JOINT VENTURE-RELATED PARTY | NOTE 8: INVESTMENT IN JOINT VENTURE-RELATED PARTY On June 11, 2019 the Company entered into operating agreement as 1/3 member of KAM Industries, LLC, a Wyoming Limited Company. On June 18, 2019 KAM Industries LLC, entered into Joint Venture Agreement to receive a percentage of the industrial hemp harvest yield on a parcel of land in Wayne County, North Carolina owned by FarmShare, LLC with whom KAM contracted to purchase a percentage of the hemp harvest for the 2019 growing season. Once the hemp is harvested from the 2019 growing season The Company will get its 1/3 share at no additional cost. The agreement then expires unless renewed for 2020 with an additional payment. The Company paid $27,490 for 33.3% of KAM Industries, LLC and recorded $0 as current asset as of December 31, 2020. This investment is counted by using cost method of accounting. An officer in KAM Industries, LLC is the Companys CEO. As of December 31, 2020, Farm Share, LLC is in the middle of the processing of the entire 2019 crop. During the virus shut down the extraction laboratories were not considered essential, but they were back in business as of June 11, 2020. We have concluded the asset is impaired due to COVID-19 restrictions. The Companys investment in joint venture-related party relating to discontinued operations consisted of the following at December 31, 2020 and 2019, respectively. December 31, 2020 December 31, 2019 Investment in Joint Venture - Related Party $ - $ 27,490 |
NOTE 9_ PROMISSORY NOTE
NOTE 9: PROMISSORY NOTE | 12 Months Ended |
Dec. 31, 2020 | |
Notes | |
NOTE 9: PROMISSORY NOTE | NOTE 9: PROMISSORY NOTE Non-Related Party On August 8, 2014 the Company entered into a Promissory Note Agreement with CanChew Biotechnologies, LLC (CCB), a related party (the owners of CCB also own a majority of the outstanding shares of the Company), under which it borrowed $1,000,000 to fund working capital. The original loan was a demand note bearing interest at the rate of 7% per annum, which amount, along with principal, was payable upon demand. The demand note was amended effective January 1, 2015 to reduce the annual interest rate to 3%. All other terms and conditions shall remain in full force and effect. The Company is in discussions to have the demand note modified or exchanged for a longer term, fixed maturity note. On May 6, 2020 (the Effective Date), AXIM Biotechnologies, Inc., a Nevada corporation (the Company), entered into an Agreement (the Separation Agreement). Pursuant to the Separation Agreement, the Company transferred 100% of its interest in CanCo and CanChew to an entity designated by Dr. Anastassov. In consideration for the transfers set forth above, any and all indebtedness owed by the Company to CanChew, totaling approximately $2.61 million, was satisfied and paid in its entirety. For the year ended December 31, 2020 and 2019 the Company recognized interest expense of $9,076 and $26,400, respectively on this note all was related to discontinued operations. On December 31, 2019, Sapphire Biotech, Inc. had entered into a Debt Exchange Agreement whereas the Company assumed three (3) loans totaling $128,375 of Debt owned by Sapphire Diagnostics, LLC which had an interest rate of 6% per annum. In the same Debt Exchange Agreement, the Company assumed four (4) additional loans made to Sapphire in 2019, which had an interest rate of 6% per annum. All seven (7) loans totaling $310,000, plus the aggregate interest accrued thereon of $14,218 making the face value of the new note $324,218. As of December 31, 2020, the principal and accrued interest balances were $324,218 and $19,507, respectively. The Company has received working capital advances from CanChew totaling $0 and $1,526,603 as of December 31, 2020 and 2019 respectively. The advances are payable on demand, all was related to discontinued operations. The Company owes $5,000 to the chairman of the board of the Company for a working capital advance of $5,000 made in May of 2014, all was related to discontinued operations. Under an agreement Mr. Changoer received on March 20, 2018 the Company issued 50,000 restrictive shares of its common stock and recorded $235,000 of compensation expenses in the accompanying consolidated financial statements to account for the issuance of the incentive shares. As of December 31, 2020 and 2019, the total outstanding balance was $60,000 and $23,696 respectively for consulting fees to Mr. Changoer, all was related to discontinued operations. On September 25, 2018, the Company amended Independent Director Compensation agreement. Under the agreement in lieu of the share compensation due to independent director of the Company for his annual service ending May 23, Dr. Philip A. Van Damme shall receive cash compensation of $20,000. Started from August 1, 2019 the company has been paying monthly clinical trial fee of $5,000. As of December 31, 2020 and 2019, the total outstanding balance was $25,000 and $9,377 respectively. Effective January 1, 2019 the company entered into a thirty-months consulting agreement with the chairman of the board which pays a monthly consulting fee of $20,000. The company has also been paying a monthly bonus fee of 15,000; this additional fee is on a month to month basis at the discretion of management. As of December 31, 2020 and 2019, the total outstanding balance was $210,000 and $35,000 respectively for consulting fees. On May 6, 2020 (the Effective Date), AXIM Biotechnologies, Inc., a Nevada corporation (the Company), entered into an Agreement (the Separation Agreement) by and among the Company, CanChew License Company (CanCo), CanChew Biotechnologies, LLC (CanChew), Medical Marijuana, Inc., Dr. George A. Anastassov (Dr. Anastassov), Dr. Philip A. Van Damme (Dr. Van Damme), Lekhram Changoer (Mr. Changoer), Sanammad Foundation, Netherlands and Sanammad Foundation, US (collectively, the Sanammad Parties), pursuant to which, among other matters as described herein, Drs. Anastassov and Van Damme and Mr. Changoer resigned as members of the Companys Board of Directors. Pursuant to the Separation Agreement, the Company transferred and assigned to an entity designated by Dr. Anastassov all of the Companys cannabis-related intellectual property other than the inventions and discoveries described in that certain cannabis-related patent application filed by the Companys wholly-owned subsidiary, Sapphire Biotech, Inc. (water-soluble cannabinoid molecules). The Company also transferred 100% of its interest in CanCo and CanChew to an entity designated by Dr. Anastassov. In consideration for the transfers set forth above, any and all indebtedness owed by the Company to CanChew, totaling approximately $2.61 million, was satisfied and paid in its entirety. In addition, in consideration for the payment by the Company of $65,000, the Company purchased 100% of the issued and outstanding 500,000 shares of Series B Preferred Stock held by the Sanammad Parties. Such shares shall be retired to treasury of the Company. The Sanammad Parties also agreed to forfeit and assign back to treasury, for no consideration, a total of 18,570,356 shares of the Companys common stock. In addition, each of Drs. Anastassov and Van Damme and Mr. Changoer have agreed to subject the shares of the Companys common stock held by each of them to lock-up and leak-out restrictions, as follows: they shall not sell shares for a period of 12 months following the Effective Date and, thereafter, subject to a daily volume limitation of 5%, on an aggregate basis among them. Further, the Company terminated the Consulting Agreement of Dr. Anastassov and the Employment Agreements for each of Dr. Van Damme and Mr. Changoer. In connection with the termination of Dr. Anastassovs Consulting Agreement, the Company agreed to pay severance in the amount of $35,000 for March 2020 and $20,000 per month thereafter through July 2021 (the termination date contemplated by the Consulting Agreement). Commencing for the April 2020, the Company may, in its sole discretion, pay the $20,000 severance obligation by the issuance of shares of the Companys common stock registered pursuant to the Registration Statement on Form S-8 filed with the Commission on May 29, 2015 (S-8 Shares). If the gross cash proceeds from the sale of any S-8 Shares issued in lieu of cash severance is less than $20,000, as determined 20 days after issuance of such S-8 Shares, then the Company has agreed to issue additional shares that would serve to true-up the value of the shares to the $20,000 monthly severance obligation; provided, however, that if 30 days after the date the severance payment is due the gross proceeds from the sale of S-8 Shares is less than $20,000, the Company must pay the shortfall in cash. In addition, for each month that Dr. Anastassov is entitled to receive severance, he shall receive S-8 Shares in an amount equal to the lesser of (a) 150,000 S-8 Shares, or (b) S-8 Shares valued at $15,000 based upon the closing price of the Companys common stock as of the due date of the severance payment obligation. In connection with the termination of the Employment Agreements of Dr. Van Damme and Mr. Changoer, Mr. Changoers severance payments shall be $20,000 per month for 12 months, commencing April 2020 (paid in arrears) and Dr. Van Dammes severance payments shall be $5,000 per month for 12 months, similarly commencing April 2020 and paid in arrears. The Company has the right to pay each of Dr. Van Dammes and Mr. Changoers monthly severance payments in S-8 shares in lieu of cash subject to the same terms and restrictions (including true-up terms) as set forth above for Dr. Anastassov. As of December 31, 2020, the accrued severance payment was $225,000 to Dr. Anastassov, $60,000 to Mr. Changoer and $25,000 to Dr. Van Damme As of December 31, 2020, the total accrued severance payment was $73,142, including $73,142 true-up adjustment, resulting in a loss of $73,142 accounted as loss on debt extinguishment related to discontinued operations. The Company retains the right to prepay the severance obligations to Drs. Anastassov and Van Damme and Mr. Changoer, without penalty. No claims were alleged by the Company against any party, and no claims were alleged against the Company. However, in connection with the transactions described above, the parties entered into a general mutual release of all claims. |
NOTE 10_ RELATED PARTY TRANSACT
NOTE 10: RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2020 | |
Notes | |
NOTE 10: RELATED PARTY TRANSACTIONS | NOTE 10: RELATED PARTY TRANSACTIONS Related Party The company has an employment agreement with Catlina Valencia at a rate of 15,000 per month commencing March 17, 2020 .The agreement can be terminated with 30 days notice by either party The company has a consulting agreement with Glycodots LLC whereby it will provide the services of Dr. Sergei A. Svarovsky at a rate of 15,000 per month commencing March 17, 2020. The agreement can be terminated with 30 days notice by either party Purchase of Promissory Note and Forbearance Agreement Effective May 4, 2020, the Company acquired from TL-66, a California limited liability company (Seller), a promissory note issued to Seller by Dr. Anastassov (Maker) dated December 1, 2017, with a face value of $350,000 and a remaining balance due of approximately $100,000 (the Note). The purchase price for the Note was $100,000 payable by the Company issuing Seller One Million (1,000,000) restricted shares of the Companys Common Stock. Effective May 6, 2020, the Company and Maker entered into a Forbearance Agreement whereby the Company agreed to forbear from making any collection efforts on the Note for a period of 24 months so long as Maker has not breached the Separation Agreement. Following 24 months, if there has been no breach of the Separation Agreement by Maker, repayment of the Note, including all principal and unpaid interest, will be waived in full. As of May, 4, 2020 the carrying value of the note receivable was $102,567, the value of the common stock to be issued was $135,000, resulting in a loss of $32,433 accounted as loss on debt extinguishment related to discontinued operations. The balance of the Note Receivable as of December 31, 2020 and 2019 is $102,567 and $0, including interest accrued thereon of $675 and $0, respectively. |
NOTE 11_ DUE TO FIRST INSURANCE
NOTE 11: DUE TO FIRST INSURANCE FUNDING | 12 Months Ended |
Dec. 31, 2020 | |
Notes | |
NOTE 11: DUE TO FIRST INSURANCE FUNDING | NOTE 11: DUE TO FIRST INSURANCE FUNDING On June 25, 2019, the Company renewed its D&O and EPLI insurance policy with total premiums, taxes and fees for $97,000 and $6,849 respectively. A cash down payment of $20,850 was paid on July 16, 2019. Under the terms of the insurance financing, payments of $9,501, which include interest at the rate of 7.2% per annum, are due each month for nine months commencing on July 25, 2019. On October 22, 2019, the Company renewed its CL Products Liability insurance policy with total premiums, taxes and fees for $18,864. A cash down payment of $1,886 was paid on October 24, 2019. Under the terms of the insurance financing, payment of $1,945, which include interest at the rate of 7.451% per annum, are due each month for nine months commencing on November 22, 2019. On June 25, 2020, the Company renewed its D&O insurance policy with total premiums, taxes and fees for $93,357. A cash down payment of $18,671 was paid on July 6, 2020. Under the terms of the insurance financing, payments of $8,456, which include interest at the rate of 4.6% per annum, are due each month for nine months commencing on July 25, 2020. The total outstanding due to First Insurance Funding as of December 31, 2020 and 2019 is $25,369 and $42,121; respectively. |
NOTE 12_ CONVERTIBLE NOTES PAYA
NOTE 12: CONVERTIBLE NOTES PAYABLE | 12 Months Ended |
Dec. 31, 2020 | |
Notes | |
NOTE 12: CONVERTIBLE NOTES PAYABLE | NOTE 12: CONVERTIBLE NOTES PAYABLE The following table summarizes convertible note payable- shareholder as of December 31, 2020 and 2019: December 31, 2020 December 31, 2019 Convertible note payable, due on July 1, 2028, interest at 3.5% p.a. $ - $ 45,000 Accrued interest - 5,578 $ - $ 50,578 The Convertible Note (Note) bears interest at the rate of 3.5% per annum, payable annually beginning on July 1, 2017, and matures on July 1, 2028. The Note is convertible, in whole or in part at any time at the option of the holder, into the Companys common stock at a conversion price of $0.01, provided however, the holder of the Note is not permitted to convert an amount of the Note that would result in the holder and its affiliates owning more than 4.9% of the Companys outstanding common stock. On July 10, 2020 the holder converted $51,414 of convertible note, which included $6,414 interest, into 5,141,377 shares of the Companys common stock, resulting in a loss of $171,889 accounted as loss on debt extinguishment. The balance of the Note as of December 31, 2020 and 2019 is $-0- and $50,578, including interest accrued thereon of $-0- and $5,578, respectively. The following table summarizes convertible note payable of related party as of December 31, 2020 and 2019: December 31, 2020 December 31, 2019 Convertible note payable, due on November 1, 2026, interest at 3.5% p.a. $ 4,000,000 $ 4,000,000 Accrued interest 158,648 93,333 Convertible note payable, net $ 4,158,648 $ 4,093,333 In 2018 the Company extinguished debt with Investor. Investor had proposed a financing transaction pursuant to which the Company will satisfy and retire the Original Note and Original Note current balance in simultaneous exchange for and upon delivery by the Company of a (1) new Convertible Promissory Note in the principal amount of $4,000,000 (the Exchange Note), and (2) 400,000 shares of the Companys restricted common stock (the Origination Shares). Simultaneously, a third-party Investor and the Company entered in Debt Exchange Agreement with Medical Marijuana Inc. As part of this agreement Investor will exchange and deliver the AXIM note to Medical Marijuana in exchange for a Convertible Promissory note. Axim consented to the transfer and assignment of the Axim Note in exchange for the issuance by the Medical Marijuana of the Exchange Note. The interest on this note is payable bi-annually every May 1 and November 1. On May 1, 2019 the Company paid accrued interest of $60,278. In 2020 the Company was authorized to apply the accounts receivable of $75,074 due from Kannaway towards its accrued interest. On May 1, 2020, the Company agreed to modify its existing convertible note with a principal balance of $4 million, 3.5% interest rate convertible note with the current holder of that note. There were two changes to the existing agreement (a) the conversion price was reduced from the $1.50 conversion price in the original Note to $0.25 cents in the modified Note and (b) the term of the note was extended from the original maturity date of November 1, 2021, to November 1, 2026. The Companys stock closed trading on the day of the modification at $0.13 per share. The amendment of this convertible Note was also evaluated under ASC Topic 470-50-40, Debt Modifications and Extinguishments. Based on the guidance, the instruments were determined to be substantially different due to the change in the conversion price being substantial, and debt extinguishment accounting was applied. The fair value of the modified convertible note was not different than the carrying value of the original note as such no extinguishment loss was recorded, The Note prior to the amendment of approximately $4 million, and the fair value of the Note and embedded derivatives after the amendment of approximately $4 million. There were no unamortized debt issuance costs and the debt discount associated with the original 2018 Note. As of December 31, 2020 and 2019, the balance of secured convertible note was $4,158,648 and $4,093,333 which included $158,648 and $93,333 accrued interest respectively. The following table summarizes convertible note payable as of December 31, 2020 and 2019: December 31, 2020 December 31, 2019 Convertible note payable, due on October 1, 2029, interest at 3.5% p.a. $ 484,478 $ 484,478 Convertible note payable, due on October 1, 2029, interest at 3.5% p.a. 1,000,000 1,000,000 Convertible note payable, due on December 31, 2034, interest at 3% p.a. 190,000 - Convertible note payable, due on July 21, 2032, interest at 3.5% p.a. 609,835 - Accrued interest (The accrued interest and principal are both included in the captionstitled convertible note payable in the balance sheet) 236,148 168,208 Total 2,520,461 1,652,686 Less: unamortized debt discount/finance premium costs (843,673) (739,732) Convertible note payable, net $ 1,676,788 $ 912,954 On September 16, 2016, we entered into a convertible note purchase agreement (the Convertible Note Purchase Agreement or Agreement) with a third-party investor. Under the terms of the Convertible Note Purchase Agreement the investor may acquire up to $5,000,000 of convertible notes from the Company. With various closings, under terms acceptable to the Company and the investor as of the time of each closing. Pursuant to the Agreement, on September 16, 2016 the investor provided the Company with $850,000 secured convertible note financing pursuant to four (4) Secured Convertible Promissory Notes (the Notes). Each of the Notes matures on October 1, 2029, and pay 3.5% compounded interest paid bi-annually. The Note are secured by the assets of the Company, may not be pre-paid without the consent of the holder, and are convertible at the option of the holder into shares of the Company common stock at a conversion price equal to $0.2201 per share. As of December 31, 2020 and 2019, the balance of secured convertible notes was $556,420 and $539,227, which included $71,942 and $54,749 accrued interest, respectively. On October 20, 2016 a third-party investor provided the Company with $1,000,000 secured convertible note financing pursuant to three (3) Secured Convertible Promissory Notes (the Notes). Each of the Notes mature on October 1, 2029 and pay 3.5% compounded interest paid bi-annually. The Notes are secured by the assets of the Company, may not be pre-paid without the consent of the holder, and are convertible at the option of the holder into shares of the Companys common stock at a fixed conversion price equal of $0.2201 per share. The investor paid cash of $500,000 for one of the Notes and issued to the Company two (2) secured promissory notes of $250,000 each for two (2) Convertible Notes of $250,000 each. The two secured promissory notes issued by the investor (totaling $500,000) as payment for two (2) secured Notes totaling $500,000 mature on February 1, 2017 ($250,000) and March 1, 2017 ($250,000), bear interest at the rate of 1% per annum, are full recourse and additionally secured by 10,486,303 shares of Medical Marijuana, Inc. (Pink Sheets symbol: MJNA) and were valued at $858,828 based upon the closing price of MJNA on October 20, 2016. A debt discount was recorded related to beneficial conversion feature inn connection with this convertible note of $499,318, related to the beneficial conversion feature of the note to be amortized over the life of the note or until the note is converted or repaid. As of December 31, 2020 and 2019, this note has not been converted and the balance of secured convertible notes was $1,148,944 and $1,113,458, which included $148,944 and $113,458 accrued interest, respectively. On December 31, 2019, Sapphire Biotech, Inc. entered into a Convertible Note Purchase Agreement whereas the Company issued a convertible note with a face value of $190,000 with a compounding interest rate of 3% per annum, the interest shall be payable annually beginning on December 31, 2020 until the maturity date of December 31, 2034, at which time all principal and interest accrued thereon shall be due and payable. The Convertible Note is secured by substantially all the Companys tangible and intangible assets. In addition, the Convertible Note includes various non-financial covenants including the Company may not enter into any agreement, arrangement or understanding of any kind that would result in a transaction, or series of transactions, that would result in the sale of 50% or more of the Companys capital stock without the prior approval of the holder. Upon issuance, the Convertible Note was convertible into shares of the Companys common stock at $1.90 per share. At December 31, 2019, the Company determined that the Convertible Note contained a beneficial conversion feature for which a full discount was recorded on the Convertible Note. The fair market value of the Companys common stock was based upon the estimated per share acquisition price per the pending acquisition of the Company. The discount of $190,000 will be amortized using the effective interest method and will be fully amortized by December 31, 2034. On March 17, 2020 the Company entered into a Share Exchange Agreement (Agreement) with Sapphire Biotech, Inc., a Delaware corporation (Sapphire) and all of the Sapphire stockholders (collectively, the Sapphire Stockholders). Following the closing of the transaction, Sapphire will become a wholly owned subsidiary of AXIM. Under the terms of the Agreement, the Company intends to assume the convertible notes in the principal amounts of $190,000. After the acquisition, the Convertible Note was able to convert 6,000,000 shares of Axims common stock. Upon assumption of the note, the Company recorded a beneficial conversion feature of $190,000. As of December 31, 2020 and 2019, the balance of secured convertible note was $195,716 and $-0-, which included $5,716 and $-0- accrued interest respectively. On July 21, 2020 the Company entered into convertible note purchase agreement with Cross & Company, the Company owed to Cross & Company $609,835 of aggregated payments and desired to satisfy the amount due in full by issuing to Cross & Company a convertible promissory note. The convertible note matures on July 21, 2032 and incurred 3.5% compounded interest paid annually. The Note are secured by the assets of the Company, may not be pre-paid without the consent of the holder, and are convertible at the option of the holder into shares of the Company common stock at a conversion price equal to $0.37. Notwithstanding the foregoing, holder shall not be permitted to convert the note, or portion thereof, if such conversion would result in beneficial ownership by holder and its affiliates of more than 4.9% of the debtors outstanding common stock as of the date of conversion. The Company determined that that the conversion of the amounts due into a long-term convertible note resulted in a debt extinguishment due to the change in the fair values exceeding 10%. Accordingly the loss of $823,497 was included in the statement of operations as loss on debt extinguishment. As of December 31, 2020 and 2019, the balance of secured convertible note was $619,381 and $-0-, which included $9,546 and $-0- accrued interest respectively. During the twelve months ended December 31, 2020 and 2019, the Company amortized the debt discount on all the notes of $86,059 and $75,272, respectively, to other expenses. As of December 31, 2020 and 2019, unamortized debt discount was $843,673 and $739,732, respectively. |
NOTE 13_ STOCK INCENTIVE PLAN
NOTE 13: STOCK INCENTIVE PLAN | 12 Months Ended |
Dec. 31, 2020 | |
Notes | |
NOTE 13: STOCK INCENTIVE PLAN | NOTE 13: STOCK INCENTIVE PLAN On May 29, 2015 the Company adopted its 2015 Stock Incentive Plan. Under the Plan the Company may issue up to 10,000,000 S-8 shares to officers, employees, directors or consultants for services rendered to the Company or its affiliates or to incentivize such parties to continue to render services. S-8 shares are registered immediately upon the filing of the Plan and are unrestricted shares that are free-trading upon issuance. There were 9,806,000 shares available for issuance under the Plan as of December 31, 2020. On January 2, 2019, John Huemoeller the CEO was granted the option to purchase 2 million shares of Axim Common stock under the plan at a purchase price of $0.75 per share. 1 million options vested immediately and 1 million options vest at the end of 2019. The Company recorded compensation expense of $-0- and $1,820,000 in 2020 and 2019. On May 13, 2020, Alim Seit-Nebi the Chief Technology Officer and Co-Founder of Sapphire Biotechnology was granted the options to purchase 1 million shares of Axim common stock under the plan at the exercise price of $0.126 per share. One third of the options will vest six months from the date of grant, one third of the options will vest one year from the date of grant, and the remaining one third of the options will vest two years from the date of grant. On May 13, 2020, Dr. Douglas Lake the Chief Clinical Officer and Co-Founder of Sapphire Biotechnology was granted the options to purchase 2 million shares of Axim common stock under the plan at the exercise price of $0.126 per share. One third of the options will vest six months from the date of grant, one third of the options will vest one year from the date of grant, and the remaining one third of the options will vest two years from the date of grant. On May 13, 2020, Timothy R, Scott the Director of Axim Biotechnology was granted the options to purchase 0.5 million shares of Axim common stock under the plan at the exercise price of $0.126 per share. One third of the options vested immediately, one third of the options will vest six months from the date of grant, and the remaining one third of the options will vest twelve months from the date of grant. On May 13, 2020, Robert Cunningham the Director of Axim Biotechnology was granted the options to purchase 0.5 million shares of Axim common stock under the plan at the exercise price of $0.126 per share. One third of the options vested immediately, one third of the options will vest six months from the date of grant, and the remaining one third of the options will vest twelve months from the date of grant. On May 13, 2020, Maurico Bellora the Director of Axim Biotechnology was granted the options to purchase 0.5 million shares of Axim common stock under the plan at the purchase price of $0.126 per share. One third of the options vested immediately, one third of the options will vest six months from the date of grant, and the remaining one third of the options will vest twelve months from the date of grant. On September 10, 2020, Noel C. Gillespie the Senior Patent Attorney of Axim Biotechnology was granted the options to purchase 0.5 million shares of Axim common stock under the plan at the purchase price of $0.61 per share. One third of the options vested immediately, one third of the options will vest one year from the date of grant, and the remaining one third of the options will vest two years from the date of grant. For the twelve months ended December 31, 2020 and 2019 the Company recorded compensation expense of $1,947,745 and $1,820,000, respectively. |
NOTE 14_ STOCKHOLDERS' DEFICIT
NOTE 14: STOCKHOLDERS' DEFICIT | 12 Months Ended |
Dec. 31, 2020 | |
Notes | |
NOTE 14: STOCKHOLDERS' DEFICIT | NOTE 14: STOCKHOLDERS DEFICIT Preferred Stock The Company has authorized 5,000,000 shares of preferred stock, with a par value of $0.0001 per share. Of the 5,000,000 authorized preferred shares, 4,000,000 are undesignated blank check preferred stock. The Company may issue such preferred shares and designate the rights, privileges and preferences of such shares at the time of designation and issuance. As of December 31, 2020, and 2019 there are -0- and -0- shares of undesignated preferred shares issued and outstanding, respectively. There are zero shares issued and outstanding of Series A and Series B Preferred stock as of December 31, 2020. Series C Convertible Preferred Stock On August 17, 2016 the Company designated up to 500,000 shares of a new Series C Convertible Preferred Stock (Series C Preferred Stock). The holders of the Series C Preferred are entitled to elect four members to the Companys board of directors and are entitled to cast 100 votes per share on all other matters presented to the shareholders for a vote. Each share of Series C Convertible Preferred is convertible into one share of the Companys common stock. The Series C Convertible Preferred designation contains a number of protective and restrictive covenants that restrict the Company from taking a number of actions without the prior approval of the holders of the Series C Preferred or the unanimous vote of all four Series C Directors. If at any time there are four Series C Directors, one such director must be independent as that term is defined in the Series C designation. Any challenge to the independence of a Series C Director is a right conferred only upon the holders of the Series B Convertible Preferred Stock and may only be made by the holders of the Series B Convertible Preferred Stock. On August 18, 2016 the Company issued all 500,000 shares of its newly designated Series C Preferred Stock to MJNA Investment Holdings, LLC in exchange for cash of $65,000. As the holders of the Series C Preferred Stock, MJNA Investment Holdings, LLC has designated Dr. Timothy R. Scott, John W. Huemoeller II, Robert Cunningham and Blake Schroeder as their four Series C Directors. On February 20, 2019, MJNA Investment Holdings LLC (Seller) sold its 500,000 shares of AXIM Biotechnologies, Inc.s, a Nevada corporation (the Company) Series C Preferred Stock to Juniper & Ivy Corporation, a Nevada corporation (Purchaser) for a purchase price of $500,000 (the Purchase Price) pursuant to a Preferred Stock Purchase Agreement (the Purchase Agreement). Payment of the Purchase Price was made as follows (i) a $65,000 payment made by check payable to Seller, which Purchaser borrowed from an unrelated third-party and which has no recourse against the Series C Preferred Stock or assets of Purchaser (the Loan), and (ii) the issuance by Purchaser to Seller of a promissory note, face value, $435,000, which has no recourse against the Series C Preferred Stock or assets of Purchaser (the Note). The Companys Chief Executive Officer John W. Huemoeller II is the President of Purchaser. Mr. Huemoeller provided a personal guaranty for the Loan and the Note. The holders of the Series C Preferred Stock are entitled to elect four members to the Companys Board of Directors and are entitled to cast 100 votes per share on all other matters presented to the shareholders for a vote. As a result of this transaction, a change in control has occurred. Effective April 2, 2019, Blake N. Schroeder resigned as a member of the Companys Board of Directors. Mr. Schroeders resignation was not because of any disagreements with the Company on matters relating to its operations, policies and practices. On April 3, 2019 pursuant to the Companys Amended and Restated Bylaws, the holder of the Companys Series C Preferred Stock appointed Mauricio Javier Gatto-Bellora to fill the director seat vacated by the resignation of Mr. Schroeder. On July 21, 2020 pursuant to the Companys Amended and Restated Bylaws, the holder of the Companys Series C Preferred Stock appointed Peter ORourke to fill one of the vacant positions on board created by the resignations of Dr. George Anastassov, Lekhram Changoer, and Dr. Philip Van Damme. Common Stock The Company has authorized 300,000,000 shares of common stock, with a par value of $0.0001 per share. As of December 31, 2020, and 2019, the Company had 125,327,579 and 64,854,539 shares of common stock issued and outstanding, respectively. 2020 Transactions: During the period between January 1, 2020 and December 31, 2020 the Company issued total 17,292,751 shares valued $3,309,130 pursuant to the Companys Registration Statement on Form S-3. The Company received $3,309,130 in cash. On January 13, 2020 the Company issued 250,000 restricted shares of its common stock to third party valued at $50,000, which were carried on the books as stock to be issued. On January 23, 2020 and February 26, 2020 the Company issued 600,000, and 62,839 restricted shares of its common stock to third party valued at $262,500, and $25,000 pursuant to the stock purchase agreement for certain services, recorded as advertising and promotion expense and License, permits & Patents, respectively. On March 17, 2020 the company acquired 100% of the issued and outstanding shares of Sapphire by means of a share exchange with the Sapphire Stockholders in exchange for 54,000,000 restricted shares of its common stock at valued $7,506,000. On April 21, 2020 the Company issued 1,176,470 restricted shares of its common stock to third party valued at $100,000 pursuant to the stock purchase agreement. The cash was received in 2020. On May 6, 2020, the Company entered into an agreement with Sanammad Foundation, the Sanammad Parties agreed to forfeit and assign back to treasury, for no consideration, a total of 18,570,356 shares of the Companys common stock, for which the fair value was $2,562,709, however for accounting purpose this transaction recording at par value adjustment to additional paid in capital. This transaction is related to the divesture of the previous operations to Sanammad. On May 22, 2020 the Company issued 190,810 and 286,215 S-8 shares valued at $60,000 and $90,000 pursuant to the Companys Registration Statement on Form S-8 for severance fees. On June 10, 2020 and June 24, 2020 the Company issued 2,173,913 and 625,000 restricted shares of its common stock to third party valued at $500,000 and $100,000 pursuant to the stock purchase agreement. The cash was received in 2020, respectively. On July 1, 2020 the Company issued 185,185 and 370,370 restricted shares of its common stock to third party valued at $25,000 and $50,000 pursuant to the stock purchase agreement. The cash was received in 2020, respectively. On July 2, 2020 and July 9, 2020 the Company issued 714,285 and 1,785,714 restricted shares of its common stock to third party valued at $100,000 and $250,000 pursuant to the stock purchase agreement. The cash was received in 2020, respectively. On July 10, 2020 the Company issued 5,141,377 restricted shares of its common stock in exchange for the conversion of $51,414 of a convertible note payable, which included $6,414 in interest. On July 10, 2020 the Company issued 142,857 and 357,153 restricted shares of its common stock to third party valued at $20,000 and $50,000 pursuant to the stock purchase agreement. The cash was received in 2020, respectively. On July 10, 2020 the Company issued 250,000 and 107,143 restricted shares of its common stock to third party valued at $35,000 and $15,000 pursuant to the stock purchase agreement. The cash was received in 2020, respectively. On July 14, 2020 the Company issued 200,000 restricted shares of its common stock to third party valued at $23,630 pursuant to the stock purchase agreement. The cash was received in 2020, respectively. On July 21, 2020 the Company entered into convertible note purchase agreement with Cross & Company, the Company owed to Cross & Company $609,835 of aggregated True-Up payments due to subscription price adjustment and desired to satisfy the amount due in full by issuing to Cross & Company a convertible promissory note (see note 12). On July 22, 2020 the Company issued 65,359 and 130,719 restricted shares of its common stock to third party valued at $20,000 and $40,000 pursuant to the stock purchase agreement. The cash was received in 2020, respectively. On July 22, 2020 the Company issued 163,398 and 326,797 restricted shares of its common stock to third party valued at $50,000 and $100,000 pursuant to the stock purchase agreement. The cash was received in 2020, respectively. On July 22, 2020 the Company issued 816,993 and 65,359 restricted shares of its common stock to third party valued at $250,000 and $20,000 pursuant to the stock purchase agreement. The cash was received in 2020, respectively. On July 24, 2020 359,524 shares for the purchase of prepaid marketing expenses valued at $302,000 On August 4, 2020 the Company issued 141,243 restricted shares of its common stock to third party valued at $50,000 pursuant to the stock purchase agreement. The cash was received in 2020. On August 6, 2020 the Company issued 148,166 and 166,686 S-8 shares valued at $120,000 and $135,000 pursuant to the Companys Registration Statement on Form S-8 for severance fees. On August 12, 2020 the Company issued 414,419 restricted shares of its common stock to third party valued at $76,690 pursuant to the stock purchase agreement for certain services, recorded as commission fees. On December 7, 2020 the Company issued 130,609 S-8 shares of its common stock to third party value at $75,000 pursuant to the Companys Registration Statement on Form S-8 for severance fees. 2019 Transactions: During the period between January 1, 2019 and December 31, 2020 the Company issued total 2,500,000 shares valued $2,514,375 pursuant to the Companys Registration Statement on Form S-3. The Company received $2,514,375 in cash On March 12, 2019 and July 11, 2019 the Company issued 239,521, and 687,285 restricted shares of its common stock to third party valued at $400,000, and $500,000 pursuant to the stock purchase agreement. The cash was received in 2018 and 2019 respectively. On May 23, 2019 and August 1, 2019 the Company issued 19,668, and 6,055 shares of its common stock to its Advisory board valued at $48,500, and $7,500 respectively, which were carried on the books as stock to be issued. These amounts were recorded as consulting expense. On December 2, 2019 and December 17, 2019 the Company issued 888,888, and 930,232 restricted shares of its common stock to third party valued at $200,000, and $200,000 pursuant to the stock purchase agreement. The cash was received in 2019. |
NOTE 15_ STOCK OPTIONS
NOTE 15: STOCK OPTIONS | 12 Months Ended |
Dec. 31, 2020 | |
Notes | |
NOTE 15: STOCK OPTIONS | NOTE 15: STOCK OPTIONS Options to purchase common stock are granted at the discretion of the Board of Directors, a committee thereof or, subject to defined limitations, an executive officer of the Company to whom such authority has been delegated. Options granted to date generally have a contractual life of ten years. The stock option activity for the year ended December 31, 2020 and 2019 is as follows: Options Outstanding Weighted Average Exercise Price Outstanding at December 31, 2018 - - Granted 2,000,000 $0.75 Exercised - - Expired or canceled - - Outstanding at December 31, 2019 2,000,000 0.75 Granted 8,300,000 0.27 Exercised - - Expired or canceled - - Outstanding at December 31, 2020 10,300,000 $ 0.36 The following table summarizes the changes in options outstanding, option exercisability and the related prices for the shares of the Companys common stock issued to employees and consultants under a stock option plan at December 31,: As of December 31, 2020 Options Outstanding Options Exercisable Weighted Average Exercise Price ($) Number Outstanding Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price ($) Number Exercisable Weighted Average Exercise Price ($) $0.36 10,300,000 10 $0.36 7,466,662 $0.36 As of December 31, 2019 Options Outstanding Options Exercisable Weighted Average Exercise Price ($) Number Outstanding Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price ($) Number Exercisable Weighted Average Exercise Price ($) $0.75 2,000,000 10 $0.75 2,000,000 $0.75 The Company determined the value of share-based compensation for options vested using the Black-Scholes fair value option-pricing model with the following weighted average assumptions: December 31, 2020 December 31, 2019 Expected life (years) 10 10 Risk-free interest rate (%) 0.61 2.66 Expected volatility (%) 230 318 Dividend yield (%) - - Weighted average fair value of shares at grant date $ 0.61 $ 0.91 For the twelve months ended December 31, 2020 and 2019 stock-based compensation expense related to vested options was $1,947,745 and $1,820,000, respectively. |
NOTE 16_ DISCONTINUED OPERATION
NOTE 16: DISCONTINUED OPERATIONS | 12 Months Ended |
Dec. 31, 2020 | |
Notes | |
NOTE 16: DISCONTINUED OPERATIONS | NOTE 16: DISCONTINUED OPERATIONS During May 2020 the Company decided to discontinue most of its operating activities pursuant to the Separation Agreement entered into by and among the Company, CanChew License Company (CanCo), CanChew Biotechnologies, LLC (CanChew), Medical Marijuana, Inc., Dr. George A. Anastassov (Dr. Anastassov), Dr. Philip A. Van Damme (Dr. Van Damme), Lekhram Changoer (Mr. Changoer), Sanammad Foundation, Netherlands and Sanammad Foundation, US (collectively, the Sanammad Parties). (see Note 1) Pursuant to the terms of the Purchase Agreement dated as of May 6, 2020, Sanammad Parties agreed to acquire from the Company substantially all of its assets and its wholly-owned subsidiaries and to assume certain liabilities and its wholly-owned subsidiaries. Sanammad Parties agreed to pay a purchase price of $2,609,100 reflected in amount due Canchew were deemed paid in full. The sale, which was completed on May 6, 2020, did not include the Companys cash and certain other excluded assets and liabilities. The assets sold and liabilities transferred in the transaction were the sole revenue generating assets of the Company. The results of operations associated with the assets sold have been reclassified into discontinued operations for periods prior to the completion of the transaction. The following is a summary of assets and liabilities sold, stock retired and gain recognized, in connection with the sale of assets to Sanammad parties: Other current assets $ 5,000 Total current assets $ 510,017 Intangible assets, net of amortization $ 47,375 Total asset $ 562,392 Notes payable $ 880,000 Accounts payable and accrued expenses $ 210,640 Due to Canchew $ 1,526,603 Stock retired $ 1,857 Total liabilities and equity 2,619,100 The gain on sale of assets was reported during the period was determined as follows: Loss on sale of assets $ 562,392 Gain on sale of liabilities $ 2,619,100 Net gain from sale of assets and liabilities $ 2,056,708 The resulting gain from the sale will be fully offset by existing net operating loss carryforwards available to the Company. For the twelve months ended December 31, 2020 and 2019 the Company recognized interest expense of $13,957 and $26,400, respectively. Additionally, the operating results and cash flows related to assets sold on May 06, 2020 are included in discontinued operations in the consolidated statements of operations and consolidated statements of cash flows for the twelve months ended December 31, 2020 and 2019. As of December 31, 2020 and 2019, the Company has separately reported the asset and liabilities of the discontinued operations in the unaudited condensed consolidated balance sheet in accordance with the provision of ASC 205-20. The asset and liabilities have been reflected as discontinued operations, and consist of the following: December 31, 2020 December 31, 2019 Current asset of discontinued operations Accounts receivable $ - $ 315,843 Inventory - 487,814 Loan receivable - 5,000 Total current assets of discontinued operations $ - $ 808,657 Noncurrent assets of discontinued operations Other assets $ - $ 50,534 Total noncurrent assets of discontinued operations $ - $ 50,534 Current liabilities of discontinued operations Accounts payable and accrued liabilities $ - $ 552,577 Due to related party - 1,526,603 Promissory note related party note payable - 1,046,926 Total current liabilities of discontinued operations $ - $ 3,126,106 Loss from Discontinued Operations The sale of the majority of the assets and liabilities related to the Sanammad parties represents a strategic shift in the Companys business. For this reason, the results of operations related to the assets and liabilities held for sale for all periods are classified as discontinued operations. The following is a summary of the results of operations related to the assets and liabilities held for sale for the twelve months ended December 31, 2020 and 2019: December 31, 2020 December 31, 2019 Net sales $ 5,097 $ 166.390 Total expenses $ 2,016,742 $ 3.647,023 Gain from sale of asset and liability $ (2,056,708) $ - Other loss $ 164,356 $ - Loss from discontinued operations $ (119,293) $ (3.480,633) The following is a summary of net cash provided by or use in operating activities, investing activities and financing activities for the assets and liabilities held for sale for the twelve months ended December 31, 2020 and 2019: December 31, 2020 December 31, 2019 Income (loss) from discontinued operations $ (119,293) $ (3,480,633) Adjustment of non-cash activities 726,748 72,762 Decrease (increase) in accounts receivable - (315,843) Increase in inventory - (478,017) Increase (decrease) in accounts payable and accrued expenses (1,823,057) 519,787 Net cash provided by (used in) operating activities $ (1,215,602) $ (3,681,944) Net cash provided by (used in) investing activities $ 27,490 $ (27,490) Net cash provided by (used in) financing activities $ (65,000) $ (78,917) |
NOTE 17_ COMMITMENT AND CONTING
NOTE 17: COMMITMENT AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2020 | |
Notes | |
NOTE 17: COMMITMENT AND CONTINGENCIES | NOTE 17: COMMITMENT AND CONTINGENCIES On January 2, 2019 the Company entered into the term of Executives employment agreement, at a base salary of $10,000 per month with John W. Huemoeller II to serve as its Chief Executive Officer. The Company and Executive acknowledge and agree that Executives employment hereunder shall at all times be at will, which means that either Executive may resign at any time for any reason or for no reason, and that the Company may terminate Executives employment at any time for any reason or for no reason, in either case, subject to the applicable provisions of this Agreement. In further consideration for Executives services and subject to the approval of the Board, Executive will be granted an option to purchase 2,000,000 shares of the Companys common stock (the Option Shares). The option will be subject to the terms and conditions applicable to stock options granted under the Companys 2015 Stock Incentive Plan, as amended from time to time (the Plan), and as described in the Plan and the stock option agreement, which Executive will be required to sign. 50% of the Option Shares shall vest on the date of grant and the remaining 50% of the Option Shares shall vest on the 12- month anniversary of the grant date, subject to Executives continued employment by the Company. The exercise price per share will be equal to the fair market value per share on the date of grant, as determined by the last closing price of the Companys common stock the day prior to grant. As of December 31, 2020 the Company recorded $1,947,745 of compensation expenses for vested stock options. Beginning in October 2019, the board decided to increase CEO base salary to $35,000 per month. On April 24, 2017 the company entered into an employment agreement with Robert Malasek, its Chief Financial Officer and Secretary. The agreement does not have a set term and may be terminated at any time by the Company or Mr. Malasek with proper notice. The shares were issued in the 1 st On August 21, 2018, AXIM Biotechnologies, Inc. (the Company) entered into an agreement with Revive Therapeutics Ltd. (Revive) to begin selling the Companys flagship nutraceutical product throughout the rapidly expanding Canadian cannabis market. The agreement defines a relationship where Revive will seek regulatory approval for AXIMs proprietary, controlled-release functional chewing gum which contains hemp oil and cannabidiol (CBD). Under the terms of the agreement, Revive will have a minimum purchase amount annually, which increases each year for the term of the agreement. On September 10, 2018, AXIM Biotechnologies, Inc. (the Company) entered into a Letter of Intent (LOI) with Impression Healthcare Limited (Impression), Australias largest home dental impression company, for exclusive distribution of all AXIM® Biotech products throughout Australia and New Zealand. Pursuant to the LOI, both parties will endeavor to enter into a definitive agreement whereby the parties will co-develop new products, initially for pre-clinical and phase 1 trials (among other clinical trials), including an oral rinse liquid targeted for the treatment of oral mucositis, strep throat, oral infections and gum disease. Pending initial discussions and an internal review of AXIM® Biotech and its product offerings, Impression will collaborate with AXIM® Biotech for the licensing and distribution of its current and future medicinal cannabis products for distribution in Australia and New Zealand. On December 20, 2018 the Company signed Exclusivity Agreement on terms that include Exclusivity period of 90 days after the date on which this agreement is executed with Impression in exchange for 10,300,000 ordinary fully paid shares in Impression at the price of A$0.02 per share and exchange rate of $0.74 AUD/USD valued $150,000 which the Company recognized as a revenue in 4 th On May 31, 2019, AXIM Biotechnologies, Inc. (AXIM) entered into a cannabinoid product supply agreement with Impression Healthcare Limited (Impression), Australias largest home dental impression company, for the supply of the AXIMs toothpaste and mouthwash containing cannabidiol (CBD) for its clinical trial for the treatment of periodontitis. The supply agreement is in preparation for a clinical trial to test the effectiveness of CBD in treating periodontitis. The clinical trial will be performed at Swinburne University of Technology in Melbourne, Australia. In accordance with the agreement, AXIM will supply the first batch of its patented toothpaste and mouthwash products containing CBD, along with associated placebo units for Impression to perform a randomized control clinical trial. On April 14, 2020 the Company terminated its supply agreement with Impression Healthcare Limited by mutual consent of both parties. On July 2, 2019, AXIM Biotechnologies, Inc. (AXIM) entered into a multi-term, non-exclusive license and distribution agreement (Agreement) with Colorado based gum developer, KISS Industries, LLC (KISS Industries). Under the terms of the Agreement, AXIM grants KISS Industries a non-exclusive license to formulate and sell products that fall within AXIMs cannabinoid chewing gum patent in exchange for royalties to be paid to AXIM based upon KISS Industries sales in the United States and Mexico. The Agreement also grants AXIM the right to: (i) acquire 10 percent of KISS Industries under certain conditions; and (ii) match any outside future offer to acquire KISS Industries as a whole. Further, AXIMs CEO John W. Huemoeller II will also join the Board of Directors of KISS Industries. In exchange for this license Kiss Industries will pay Axim 6% of gross sales as a royalty on all licensed products sold by Kiss. In the territory covered by this license which is the USA and Mexico. (Minimum annual royalty $50,000). Kiss will manufacture for Axim various licensed products at a price equal to 140% of Kisss cost. As of December 31, 2020 and 2019 Kiss Industries did not sell any Axims products. Industry Sponsored Research Agreement Sapphire entered into the Industry Sponsored Research Agreement (SRA) effective February 7, 2020 to test and confirm the inhibitory activity of SBI-183 (exclusively licensed on January 13, 2020) and SBI-183 analogs, including those synthesized by the Company. The testing will include cell-based in vitro assays, NMR binding studies and testing to determine if SBI-183 enhances the activity of cytotoxic drugs in vitro. Animal studies will also be conducted under the SRA. Specifically, SBI-183 analogs will be evaluated in a mouse model of triple negative breast cancer using human tumor xenografts. The work will be performed over a period of one year with the total cost of the SRA totaling $150,468 paid prior to acquisition. In consideration of the License executed between Skysong Innovations and the Company, the SRA provides for a reduced overhead of 5% instead of the usual 67.7%. This overhead fee differential of $89,851 will be deferred for five (5) years with interest of 5% compounded annually. For the twelve months ended December 31, 2020, the Company recorded research and development expenses of $78,620. On August 5, 2020 Sapphire was awarded a $395,880 phase I Small Business Innovation Research (SBIR) grant by the National Cancer Institute (NCI). The grant will support continued development of novel small molecules that inhibit the enzymatic activity of Quiescin Sulfhydryl Oxidase I (QSOX1) based on a lead compound. QSOX1 is a tumor-derived enzyme that is important for cancer growth, invasion and metastasis. Sapphire is conducting this research with technology it has exclusively licensed from Skysong Innovations, LLC, the intellectual property management company for Arizona State University. Sapphire will subcontract tumor biology work for evaluating analog inhibitors for QSOX1 to Dr. Doug Lakes laboratory at Arizona State University and Mayo Clinic Arizona. Grant income received for the year ending December 31, 2020 was $115,899 On August 25, 2020 we signed an exclusive licensing, manufacturing and distribution agreement with Empowered Diagnostics LLC to execute the high-volume production of our rapid point-of-care diagnostic test. AXIM and Empowered have completed the technology transfer and Empowered Diagnostics has built out their production facility to be able to manufacture millions of our neutralizing antibody tests for Covid-19 per month. In exchange for this license Empowered will pay Axim a royalty on net sales on all licensed products sold by Empowered covered by this license which global with the exception of Mexico. Operating Lease Lease AgreementOn March 3, 2020, Sapphire entered into a 3-year lease agreement (Lease) to relocate to a larger space within the same business park. The new space totals 1,908 square feet with monthly base rent in the 1st year $4,713, 2nd year $4,854 and 3rd year $5,000 at implicit interest rate of 6%. Upon commencement of the Lease on April 25, 2020, the previous lease will expire. Operating Leases - Right of Use Assets and Purchase Commitments Right of Use Assets We have operating leases for office space that expire through 2020. Below is a summary of our right of use assets and liabilities as of December 31, 2020. Right-of-use assets $ 130,722 Lease liability obligations, current $ 53,851 Lease liability obligations, noncurrent 76,871 Total lease liability obligations $ 130,722 Weighted-average remaining lease term 2.33 years Weighted-average discount rate 6% The following table summarizes the lease expense for the twelve months ended December 31, 2020 and 2019: December 31, 2020 December 31, 2019 Operating lease expense $ 32,991* $ - Short-term lease expense 20,831 35,696 Total lease expense $ 53,822 $ 35,696 *The first lease payment was made and adjusted in preacquisition cost. Approximate future minimum lease payments for our right of use assets over the remaining lease periods as of December 31, 2020, are as follows: Remainder of 2020 $ -0- 2021 57,684 2022 59,416 2023 20,000 Total minimum payments 137,100 Less: amount representing interest (6,378) Total $ 130,722 Litigation As of December 31, 2020, and this report issuing date, the Company is not a party to any pending material legal proceeding. To the knowledge of management, no federal, state or local governmental agency is presently contemplating any proceeding against the Company. To the knowledge of management, no director, executive officer or affiliate of the Company, any owner of record or beneficially of more than five percent of the Companys Common Stock is a party adverse to the Company or has a material interest adverse to the Company in any proceeding. |
NOTE 18_ INCOME TAXES
NOTE 18: INCOME TAXES | 12 Months Ended |
Dec. 31, 2020 | |
Notes | |
NOTE 18: INCOME TAXES | NOTE 18: INCOME TAXES The Company utilizes ASC 740 Income Taxes, which requires the recognition of deferred tax liabilities and assets for the expected future tax consequences of events that have been included in the financial statement or tax returns. Under this method, deferred tax liabilities and assets are determined based on the difference between financial statements and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The U.S. tax reform bill that Congress voted to approve December 20, 2017, also known as the Tax Cuts and Jobs Act, made sweeping modification to the Internal Revenue Code, including a much lower corporate tax rate, changes to credits and deductions, and a move to a territorial system for corporations that have overseas earnings. The Act replaced the prior law graduated corporate tax rate, which taxed income over $10 million at 35%, with a flat rate of 21%. The Coronavirus Aid, Relief and Economy Security (CARES) Act (the CARES Act, H.R. 748) was signed into law on 27 March 2020. The CARES Act temporarily eliminates the 80% taxable income limitation (as enacted under the Tax Cuts and Jobs Act of 2017) for NOL deductions for 2018-2020 tax years and reinstated NOL carrybacks for the 2018-2020 tax years. Moreover, the CARES Act also temporarily increases the business interest deduction limitations from 30% to 50% of adjusted taxable income for the 2019 and 2020 taxable year. Lastly, the Tax Act technical correction classifies qualified improvement property as 15-year recovery period, allowing the bonus depreciation deduction to be claimed for such property retroactively as if it was included in the Tax Act at the time of enactment. The Company does not anticipate a material impact on its financial statements as of December 31, 2020 due to the recent enactment. For the period ended December 31, 2020, The Company had available, for Federal income tax purposes, net operating losses of $9,024,000 which expire at various dates through December 31, 2030 and $13,490,076 which have no expiration date. The net operating loss carryovers may be subject to limitations under Internal Revenue Code section 382, due to significant changes in the Company's ownership. If a change of ownership has occurred the net operating loss carryovers would be limited or might be eliminated. The provision for income taxes differ from the amount of income tax determined by applying the applicable U.S. statutory rate to losses before income tax expense for the period ended December 31, 2020 and 2019 as follows: Rate Reconciliation 2020 2019 Expected tax at statutory rates 21.00% 21% State Income Tax, Net of Federal benefit 6.98% 11.9% Current Year Change in Valuation Allowance -11.74% -32.9% Prior Year NOL True-Ups -16.24% Deferred income taxes result from temporary differences in the recognition of income and expenses for financial reporting purposes and for tax purposes. The tax effect of these temporary differences representing deferred tax asset result principally from the following: Deferred Tax Assets/(Liab.) Detail 2020 2019 Stock Compensation 646,963 - Amortization 24,082 - Interest 66,376 - Net Operating Loss Carry Forward 6,038,109 6,022,948 Valuation Allowance (6,775,530) (6,022,948) Total gross deferred tax assets - - *The company moved its base operations to California in 2019 California Net operating Losses Total 8,355,508 NYS Net Operating Loss Total 14,157,020 The valuation allowance for deferred tax assets as of December 31, 2020 and 2019 was $6,775,530 and $6,022,948, respectively. In assessing the recovery of the deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income in the periods in which those temporary differences become deductible. Management considers the scheduled reversals of future deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. The Company will continue to monitor the potential utilization of this asset. Should factors and evidence change to aid in this assessment, a potential adjustment to the valuation allowance in future periods may occur. Management believes it is more likely than not that the deferred tax asset will not be realized, so a 100% Valuation Reserve has been established at December 31, 2020. Company is aware that as of there may be section 382 limitations on loss carryforward due to , to the acquisition of Sapphire biotechnology but has not analyzed them at this time. |
NOTE 19_ SUBSEQUENT EVENTS
NOTE 19: SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2020 | |
Notes | |
NOTE 19: SUBSEQUENT EVENTS | NOTE 19: SUBSEQUENT EVENTS On , March 3, 2021, March 18, 2021 and April 5, 2021 the Company issued 2,232,328 shares for cash of $622,500 pursuant to various Stock purchase agreements.. The cash was received in 2021. On March 18, 2021 and April 5, 2021 the company issued 1,300,193 restricted shares of its common stock valued at $843,974 to third parties for certain services, recorded as advertising and promotion expense and License, permits & Patents, respectively |
NOTE 5_ SIGNIFICANT ACCOUNTIN_2
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Use of estimates (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Policies | |
Use of estimates | Use of estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements as well as the reported amounts of revenue and expenses during reporting periods. Actual results could differ from these estimates. Significant estimates are assumptions about collection of accounts receivable, useful life of intangible assets and assumptions used in Black-Scholes-Merton, or BSM, valuation methods, such as expected volatility, risk-free interest rate and expected dividend rate. |
NOTE 5_ SIGNIFICANT ACCOUNTIN_3
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Operating lease (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Policies | |
Operating lease | Operating lease We lease property under various operating leases which are disclosed on our Balance sheet in accordance with ASC 842 |
NOTE 5_ SIGNIFICANT ACCOUNTIN_4
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Risks and uncertainties (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Policies | |
Risks and uncertainties | Risks and uncertainties The Company operates in a dynamic and highly competitive industry and is subject to risks and uncertainties common to early-stage companies in the biotechnology industry, including, but not limited to, development by competitors of new technological innovations, protection of proprietary technology, dependence on key personnel, contract manufacturer and contract research organizations, compliance with government regulations and the need to obtain additional financing to fund operations. Product candidates currently under development will require significant additional research and development efforts, including extensive preclinical studies and clinical trials and regulatory approval, prior to commercialization. These efforts require significant amounts of additional capital, adequate personnel infrastructure and extensive compliance and reporting. The Company believes that changes in any of the following areas could have a material adverse effect on the Companys future financial position, results of operations, or cash flows; ability to obtain future financing; advances and trends in new technologies and industry standards; results of clinical trials; regulatory approval and market acceptance of the Companys products; development of sales channels; certain strategic relationships; litigation or claims against the Company based on intellectual property, patent, product, regulatory, or other factors; and the Companys ability to attract and retain employees necessary to support its growth. Products developed by the Company require approvals from the U.S. Food and Drug Administration (FDA) or other international regulatory agencies prior to commercial sales. There can be no assurance that the Companys research and development will be successfully completed, that adequate protection for the Companys intellectual property will be obtained or maintained, that the products will receive the necessary approvals, or that any approved products will be commercially viable. If the Company was denied approval, approval was delayed or the Company was unable to maintain approval, it could have a materially adverse impact on the Company. Even if the Companys product development efforts are successful, it is uncertain when, if ever, the Company will generate revenue from product sales. The Company operates in an environment of rapid change in technology and substantial competition from other pharmaceutical and biotechnology companies. In addition, the Company is dependent upon the services of its employees, consultants and other third parties. Beginning in late 2019, the outbreak of a novel strain of virus named SARS-CoV-2 (severe acute respiratory syndrome coronavirus 2), or coronavirus, which causes coronavirus disease 2019, or COVID-19, has evolved into a global pandemic. The extent of the impact of the coronavirus outbreak on the Companys business will depend on certain developments, including the duration and spread of the outbreak and the extent and severity of the impact on the Companys clinical trial activities, research activities and suppliers, all of which are uncertain and cannot be predicted. At this point, the extent to which the coronavirus outbreak may materially impact the Companys financial condition, liquidity or results of operations is uncertain. The Company has expended and will continue to expend substantial funds to complete the research, development and clinical testing of product candidates. The Company also will be required to expend additional funds to establish commercial-scale manufacturing arrangements and to provide for the marketing and distribution of products that receive regulatory approval. The Company may require additional funds to commercialize its products. The Company is unable to entirely fund these efforts with its current financial resources. If adequate funds are unavailable on a timely basis from operations or additional sources of financing, the Company may have to delay, reduce the scope of or eliminate one or more of its research or development programs which would materially and adversely affect its business, financial condition and operations. There have been no material changes in the accounting policies from those disclosed in the financial statements and the related notes included in the Form 10-K. |
NOTE 5_ SIGNIFICANT ACCOUNTIN_5
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Cash equivalents (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Policies | |
Cash equivalents | Cash equivalents The Company considers all highly liquid investments with original maturities of three months or less at the time of purchase to be cash equivalents. As of December 31, 2020, the Company had no cash equivalents. Cash and cash equivalents are maintained at financial institutions and, at times, balances may exceed federally insured limits. The Company had no uninsured balances at December 31, 2020. The Company has never experienced any losses related to these balances. |
NOTE 5_ SIGNIFICANT ACCOUNTIN_6
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Accounts Receivable (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Policies | |
Accounts Receivable | Accounts Receivable It is the Company's policy to review accounts receivable at least on a monthly basis for conductibility and follow up with customers accordingly. Covid19 has slowed collection as our customers are in a mandated pause. We do not have geographic concentration of customers. |
NOTE 5_ SIGNIFICANT ACCOUNTIN_7
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Concentrations (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Policies | |
Concentrations | Concentrations At December 31, 2020, there was no accounts receivable. For the year ended December 31, 2020, one customer accounted for 21% of total revenue. For the year ended December 31, 2019, two customers accounted for 95% of total revenue. Revenue was all generated from discontinued operations for the twelve months ending December 31, 2020 and 2019. |
NOTE 5_ SIGNIFICANT ACCOUNTIN_8
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Inventory (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Policies | |
Inventory | Inventory Inventory consists of finished goods available for sale and raw materials owned by the Company and are stated at the lower of cost or market. As of December 31, 2020 and 2019, the Company had $-0- and $175,304 of finished goods and $-0- and $312,511 of raw material, respectively. The Companys inventory relating to discontinued operations consisted of the following at December 31, 2020 and 2019, respectively. December 31, 2020 December 31, 2019 Finished goods $ - $ 175,304 Raw material $ - $ 312,511 $ - $ 487,815 |
NOTE 5_ SIGNIFICANT ACCOUNTIN_9
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Property and equipment (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Policies | |
Property and equipment | Property and equipment Property and equipment are carried at cost less accumulated depreciation. Depreciation is computed using straight-line method over the estimated useful life. New assets and expenditures that extend the useful life of property or equipment are capitalized and depreciated. Expenditures for ordinary repairs and maintenance are charged to operations as incurred. The Companys property and equipment relating to continuing operations consisted of the following at December 31, 2020 and 2019, respectively, and none related to discontinued operations. December 31, 2020 December 31, 2019 Equipment of continuing operations $ 134,788 $ 16,780 Less: accumulated depreciation $ 30,694 $ 14,543 $ 104,094 $ 2,237 |
NOTE 5_ SIGNIFICANT ACCOUNTI_10
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Intangible Assets (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Policies | |
Intangible Assets | Intangible Assets As required by generally accepted accounting principles, trademarks and patents are amortized if they have a definite life, and not amortized if they have an indefinite life and then they are tested annually for impairment. The Companys intangible assets relating to continuing operations and discontinued operations consisted of the following at December 31, 2020 and 2019, respectively. December 31, 2020 December 31, 2019 Goodwill $ 2,458,233 $ - Research in progress 7,800,000 - $ 10,258,233 $ - Intangible assets of discontinued operations $ - $ 715,432 Less: accumulated amortization and impairment - 664,898 $ - $ 50,534 |
NOTE 5_ SIGNIFICANT ACCOUNTI_11
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Revenue Recognition (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Policies | |
Revenue Recognition | Revenue Recognition The Company follows the guidance contained in Topic 606 (FASB ASC 606). The core principle of Topic 606 (FASB ASC 606) is that an entity should recognize revenue to depict the transfer of goods of services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The revenue recognition guidance contained in Topic 606, to follow the five-step revenue recognition model along with other guidance impacted by this standard: (1) identify the contract with the customer; (2) identify the performance obligations in the contract; (3) determine the transportation price; (4) allocate the transportation price; (5) recognize revenue when or as the entity satisfies a performance obligation. All revenue was from operations that were divested. Revenues are recognized when title for goods is transferred; non-refundable fees and proceeds from irrevocable agreements recognized when inflows or other enhancements of assets of the Company are received. Revenues from continuing operations recognized for twelve months ended December 31, 2020 and 2019 amounted to $-0- and $-0-, respectively. Revenues from discontinued operations recognized for twelve months ended December 31, 2020 and 2019 amounted to $7,990 and $742,083, respectively. |
NOTE 5_ SIGNIFICANT ACCOUNTI_12
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Derivative Liabilities (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Policies | |
Derivative Liabilities | Derivative Liabilities The Company assessed the classification of its derivative financial instruments as of December 31, 2020, which consist of convertible instruments and rights to shares of the Companys common stock and determined that such derivatives meet the criteria for liability classification under ASC 815. ASC 815 generally provides three criteria that, if met, require companies to bifurcate conversion options from their host instruments and account for them as free standing derivative financial instruments. These three criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument subject to the requirement of ASC 815. ASC 815 also provides an exception to this rule when the host instrument is deemed to be conventional, as described. |
NOTE 5_ SIGNIFICANT ACCOUNTI_13
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Fair Value Measurement, Policy (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Policies | |
Fair Value Measurement, Policy | Fair Value Measurements The Company applies the guidance that is codified under ASC 820-10 related to assets and liabilities recognized or disclosed in the financial statements at fair value on a recurring basis. ASC 820-10 defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. The provisions of ASC 820-10 only apply to the Companys investment securities, which are carried at fair value. ASC 820-10 clarifies that fair value is an exit price, representing the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants based on the highest and best use of the asset or liability. As such, fair value is a market-based measurement that is determined based on assumptions that market participants would use in pricing an asset or liability. ASC 820-10 requires valuation techniques to measure fair value that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized as follows: Fair Value Hierarchy Inputs to Fair Value Methodology Level 1 Quoted prices in active markets for identical assets or liabilities Level 2 Quoted prices for similar assets or liabilities; quoted markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the financial instrument; inputs other than quoted prices that are observable for the asset or liability; or inputs that are derived principally from, or corroborated by, observable market information Level 3 Pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption is unobservable or when the estimation of fair value requires significant management judgment The Company categorizes a financial instrument in the fair value hierarchy based on the lowest level of input that is significant to its fair value measurement. As of December 31, 2020 Quoted Market Prices in Active Markets (Level 1) Internal Models with Significant Observable Market Parameters (Level 2) Internal Models with Significant Unobservable Market Parameters (Level 3) Total Fair Value Reported in Financial Statements Marketable Securities $- $- $- $- As of December 31, 2019 Quoted Market Prices in Active Markets (Level 1) Internal Models with Significant Observable Market Parameters (Level 2) Internal Models with Significant Unobservable Market Parameters (Level 3) Total Fair Value Reported in Financial Statements Marketable Securities $213,745 $- $- $213,745 For the twelve months ended December 31, 2020 and 2019 The Company recorded unrealized gain (loss) on marketable securities of $(104,705) and $113,748, respectively, and realized gain (loss) on marketable securities of $(109,040) and $268,274, respectively. These securities are classified as trading. The Company did not have any Level 2 or Level 3 assets or liabilities as of December 31, 2020, except for its convertible notes payable , in process Research and Development. The carrying amounts of these assets and liabilities at December 31, 2020 approximate their respective fair value based on the Companys incremental borrowing rate. Cash is as of December 31, 2020 and 2019 is classified as Level 1 within our fair value hierarchy. |
NOTE 5_ SIGNIFICANT ACCOUNTI_14
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Convertible Instruments (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Policies | |
Convertible Instruments | Convertible Instruments The Company evaluates and accounts for conversion options embedded in its convertible instruments in accordance with professional standards for Accounting for Derivative Instruments and Hedging Activities. Professional standards generally provide three criteria that, if met, require companies to bifurcate conversion options from their host instruments and account for them as free standing derivative financial instruments. These three criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instruments are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument. Professional standards also provide an exception to this rule when the host instrument is deemed to be conventional as defined under professional standards as The Meaning of Conventional Convertible Debt Instrument. The Company accounts for convertible instruments (when it has determined that the embedded conversion options should not be bifurcated from their host instruments) in accordance with professional standards when Accounting for Convertible Securities with Beneficial Conversion Features, as those professional standards pertain to Certain Convertible Instruments. Accordingly, the Company records, when necessary, discounts to convertible notes for the intrinsic value of conversion options embedded in debt instruments based upon the differences between the fair value of the underlying common stock at the commitment date of the note transaction and the effective conversion price embedded in the note. Debt discounts under these arrangements are amortized over the term of the related debt to their earliest date of redemption. The Company also records when necessary deemed dividends for the intrinsic value of conversion options embedded in preferred shares based upon the differences between the fair value of the underlying common stock at the commitment date of the note transaction and the effective conversion price embedded in the note. ASC 815-40 provides that, among other things, generally, if an event is not within the entitys control could or require net cash settlement, then the contract shall be classified as an asset or a liability. |
NOTE 5_ SIGNIFICANT ACCOUNTI_15
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Income Taxes (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Policies | |
Income Taxes | Income Taxes The Company follows Section 740-10, Income tax (ASC 740-10) Fair Value Measurements and Disclosures of the FASB Accounting Standards Codification, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the Statements of Operations in the period that includes the enactment date. The Company recognizes deferred tax assets to the extent that the Company believes that these assets are more likely than not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including reversals of any existing taxable temporary differences, projected future taxable income, tax planning strategies, and the results of recent operations. If the Company determines that it would be able to realize a deferred tax asset in the future in excess of any recorded amount, the Company would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes. The Company adopted section 740-10-25 of the FASB Accounting Standards Codification (Section 740-10-25). Section 740-10-25 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under Section 740-10-25, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate settlement. Section 740-10-25 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures. The Company had no liabilities for unrecognized income tax benefits according to the provisions of Section 740-10-25. |
NOTE 5_ SIGNIFICANT ACCOUNTI_16
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Concentrations of Credit Risk (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Policies | |
Concentrations of Credit Risk | Concentrations of Credit Risk Financial instruments and related items, which potentially subject the Company to concentrations of credit risk, consist primarily of cash and cash equivalents. The Company places its cash and temporary cash investments with credit quality institutions. At times, such amounts may be in excess of the FDIC insurance limit. The Company had $0 and $240,769 allowance for doubtful accounts at December 31, 2020 and 2019, respectively and had $0 accounts receivable at December 31, 2020 and $240,769 at December 31, 2019, all was related to discontinued operations. |
NOTE 5_ SIGNIFICANT ACCOUNTI_17
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Net Loss per Common Share (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Policies | |
Net Loss per Common Share | Net Loss per Common Share Net loss per common share is computed pursuant to section 260-10-45 Earnings Per Share (ASC 260-10) of the FASB Accounting Standards Codification. Basic net loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding and the member potentially outstanding during each period. In periods when a net loss is experienced, only basic net loss per share is calculated because to do otherwise would be anti-dilutive. There were common share equivalents 32,556,727 at December 31, 2020 and 16,295,498 at December 31, 2019. For the year ended December 31, 2020 and 2019 these potential shares were excluded from the shares used to calculate diluted earnings per share as their inclusion would reduce net loss per share. |
NOTE 5_ SIGNIFICANT ACCOUNTI_18
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Stock Based Compensation (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Policies | |
Stock Based Compensation | Stock Based Compensation All stock-based payments to employees and to nonemployee directors for their services as directors, including any grants of restricted stock and stock options, are measured at fair value on the grant date and recognized in the statements of operations as compensation or other expense over the relevant service period. Stock-based payments to nonemployees are recognized as an expense over the period of performance. Such payments are measured at fair value at the earlier of the date a performance commitment is reached, or the date performance is completed. In addition, for awards that vest immediately and are non-forfeitable the measurement date is the date the award is issued. The Company accounts for stock options issued to non-employees based on the estimated fair value of the awards using the Black-Scholes option pricing model in accordance with ASC 505-50, Equity-Based Payment to Non-employees |
NOTE 5_ SIGNIFICANT ACCOUNTI_19
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Cost of Sales (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Policies | |
Cost of Sales | Cost of Sales Cost of sales includes the purchase cost of products sold and all costs associated with getting the products to the customers including buying and transportation costs. |
NOTE 5_ SIGNIFICANT ACCOUNTI_20
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Research and Development (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Policies | |
Research and Development | Research and Development The Company accounts for research and development costs in accordance with the Accounting Standards Codification subtopic 730-10, Research and Development (ASC 730-10). Under ASC 730-10, all research and development costs must be charged to expense as incurred. Accordingly, internal research and development costs are expensed as incurred. Third-party research and development costs are expensed when the contracted work has been performed or as milestone results have been achieved. Company-sponsored research and development costs related to both present and future products are expensed in the period incurred. For the twelve months ended December 31, 2020 and 2019 The Company incurred research and development expenses of $426,708 and $-0- from continuing operations, respectively. For the twelve months ended December 31, 2020 and 2019 the Company incurred research and development expenses of $377,416 and $2,452,506 from discontinued operations, respectively. The Company has entered into various agreements with CROs. The Companys research and development accruals are estimated based on the level of services performed, progress of the studies, including the phase or completion of events, and contracted costs. The estimated costs of research and development provided, but not yet invoiced, are included in accrued liabilities on the balance sheet. If the actual timing of the performance of services or the level of effort varies from the original estimates, the Company will adjust the accrual accordingly. Payments made to CROs under these arrangements in advance of the performance of the related services are recorded as prepaid expenses and other current assets until the services are rendered. |
NOTE 5_ SIGNIFICANT ACCOUNTI_21
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Shipping Costs (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Policies | |
Shipping Costs | Shipping Costs Shipping and handling costs billed to customers are recorded in sales. Shipping costs incurred by the company are recorded in general and administrative expenses. |
NOTE 5_ SIGNIFICANT ACCOUNTI_22
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Recently Issued Accounting Standards (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Policies | |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In March 2019, the FASB issued ASU 2019-01, Leases (Topic 842) Codification Improvements The Company has a long-term operating lease, and the long-term operating lease took effect in April 2020 (see note 17). In November 2018, the FASB issued ASU 2018-18 , Collaborative Arrangements (Topic 818): Clarifying the Interaction Between Topic 808 and Topic 606 In October 2018, the FASB issued ASU 2018-17, Targeted Improvements to Related Party Guidance for Variable Interest Entities In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customers Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract. In August 2018, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement Other recent accounting pronouncements issued by the FASB and the SEC did not or are not believed by management to have a material impact on the Companys present or future consolidated financial statements. |
NOTE 16_ DISCONTINUED OPERATI_2
NOTE 16: DISCONTINUED OPERATIONS: Results of operations related to the assets and liabilities held for sale (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Policies | |
Results of operations related to the assets and liabilities held for sale | December 31, 2020 December 31, 2019 Net sales $ 5,097 $ 166.390 Total expenses $ 2,016,742 $ 3.647,023 Gain from sale of asset and liability $ (2,056,708) $ - Other loss $ 164,356 $ - Loss from discontinued operations $ (119,293) $ (3.480,633) |
NOTE 2_ ACQUISITION OF SAPPHI_2
NOTE 2: ACQUISITION OF SAPPHIRE BIOTECH, INC: Schedule of Consideration paid for Sapphire (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Tables/Schedules | |
Schedule of Consideration paid for Sapphire | Consideration: Cash and cash equivalents $ 79,814 Property and equipment, net 20,533 In process R&D 7,800,000 Goodwill 2,458,233 Security deposit 12,785 Total asset acquired $ 10,371,365 Accrued expenses and other current liabilities $ 5,767 Deferred taxes liability 2,340,000 Notes Payable including convertible and discount on conversion 519,598 Total liabilities assumed $ 2,865,365 Net assets acquired $ 7,506,000 |
NOTE 2_ ACQUISITION OF SAPPHI_3
NOTE 2: ACQUISITION OF SAPPHIRE BIOTECH, INC: Schedule of Pro forma consolidated results of operations (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Tables/Schedules | |
Schedule of Pro forma consolidated results of operations | For twelve months ended December 31, 2020 December 31, 2019 Revenues $ - $ - Net loss from continuing operations $ (6,716,906) $ (3,508,529) Net income (loss) from discontinued operations $ (119,293) $ (3,480,633) Net loss per shareBasic and Diluted $ (0.06) $ (0.10) |
NOTE 5_ SIGNIFICANT ACCOUNTI_23
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Inventory: Schedule of Inventory relating to discontinued operations (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Tables/Schedules | |
Schedule of Inventory relating to discontinued operations | December 31, 2020 December 31, 2019 Finished goods $ - $ 175,304 Raw material $ - $ 312,511 $ - $ 487,815 |
NOTE 5_ SIGNIFICANT ACCOUNTI_24
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Property and equipment: Schedule of Property and equipment relating to continuing operations (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Tables/Schedules | |
Schedule of Property and equipment relating to continuing operations | December 31, 2020 December 31, 2019 Equipment of continuing operations $ 134,788 $ 16,780 Less: accumulated depreciation $ 30,694 $ 14,543 $ 104,094 $ 2,237 |
NOTE 5_ SIGNIFICANT ACCOUNTI_25
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Intangible Assets: Schedule of Intangible assets relating to continuing operations (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Tables/Schedules | |
Schedule of Intangible assets relating to continuing operations | December 31, 2020 December 31, 2019 Goodwill $ 2,458,233 $ - Research in progress 7,800,000 - $ 10,258,233 $ - Intangible assets of discontinued operations $ - $ 715,432 Less: accumulated amortization and impairment - 664,898 $ - $ 50,534 |
NOTE 6_ PREPAID EXPENSES_ Sched
NOTE 6: PREPAID EXPENSES: Schedule of Prepaid Expenses (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Tables/Schedules | |
Schedule of Prepaid Expenses | December 31, 2020 December 31, 2019 Prepaid insurance $ 45,983 $ 67,734 Prepaid services/inventory 209,940 9,872 $ 255,923 $ 77,606 |
NOTE 8_ INVESTMENT IN JOINT V_2
NOTE 8: INVESTMENT IN JOINT VENTURE-RELATED PARTY: Schedule of Investment in Joint Venture (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Tables/Schedules | |
Schedule of Investment in Joint Venture | December 31, 2020 December 31, 2019 Investment in Joint Venture - Related Party $ - $ 27,490 |
NOTE 12_ CONVERTIBLE NOTES PA_2
NOTE 12: CONVERTIBLE NOTES PAYABLE: Schedule of Convertible Notes Payable, Shareholder (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Tables/Schedules | |
Schedule of Convertible Notes Payable, Shareholder | December 31, 2020 December 31, 2019 Convertible note payable, due on July 1, 2028, interest at 3.5% p.a. $ - $ 45,000 Accrued interest - 5,578 $ - $ 50,578 |
NOTE 12_ CONVERTIBLE NOTES PA_3
NOTE 12: CONVERTIBLE NOTES PAYABLE: Schedule of Convertible Notes Payable (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Tables/Schedules | |
Schedule of Convertible Notes Payable | December 31, 2020 December 31, 2019 Convertible note payable, due on November 1, 2026, interest at 3.5% p.a. $ 4,000,000 $ 4,000,000 Accrued interest 158,648 93,333 Convertible note payable, net $ 4,158,648 $ 4,093,333 |
NOTE 12_ CONVERTIBLE NOTES PA_4
NOTE 12: CONVERTIBLE NOTES PAYABLE: Schedule of Convertible note payable (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Tables/Schedules | |
Schedule of Convertible note payable | December 31, 2020 December 31, 2019 Convertible note payable, due on October 1, 2029, interest at 3.5% p.a. $ 484,478 $ 484,478 Convertible note payable, due on October 1, 2029, interest at 3.5% p.a. 1,000,000 1,000,000 Convertible note payable, due on December 31, 2034, interest at 3% p.a. 190,000 - Convertible note payable, due on July 21, 2032, interest at 3.5% p.a. 609,835 - Accrued interest (The accrued interest and principal are both included in the captionstitled convertible note payable in the balance sheet) 236,148 168,208 Total 2,520,461 1,652,686 Less: unamortized debt discount/finance premium costs (843,673) (739,732) Convertible note payable, net $ 1,676,788 $ 912,954 |
NOTE 15_ STOCK OPTIONS_ Schedul
NOTE 15: STOCK OPTIONS: Schedule of Stock option activity (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Tables/Schedules | |
Schedule of Stock option activity | Options Outstanding Weighted Average Exercise Price Outstanding at December 31, 2018 - - Granted 2,000,000 $0.75 Exercised - - Expired or canceled - - Outstanding at December 31, 2019 2,000,000 0.75 Granted 8,300,000 0.27 Exercised - - Expired or canceled - - Outstanding at December 31, 2020 10,300,000 $ 0.36 |
NOTE 15_ STOCK OPTIONS_ Sched_2
NOTE 15: STOCK OPTIONS: Schedule of Changes in options outstanding, option exercisability and the related prices for the shares of the Company's common stock (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Tables/Schedules | |
Schedule of Changes in options outstanding, option exercisability and the related prices for the shares of the Company's common stock | As of December 31, 2020 Options Outstanding Options Exercisable Weighted Average Exercise Price ($) Number Outstanding Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price ($) Number Exercisable Weighted Average Exercise Price ($) $0.36 10,300,000 10 $0.36 7,466,662 $0.36 As of December 31, 2019 Options Outstanding Options Exercisable Weighted Average Exercise Price ($) Number Outstanding Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price ($) Number Exercisable Weighted Average Exercise Price ($) $0.75 2,000,000 10 $0.75 2,000,000 $0.75 |
NOTE 15_ STOCK OPTIONS_ Sched_3
NOTE 15: STOCK OPTIONS: Schedule of Weighted average assumptions (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Tables/Schedules | |
Schedule of Weighted average assumptions | December 31, 2020 December 31, 2019 Expected life (years) 10 10 Risk-free interest rate (%) 0.61 2.66 Expected volatility (%) 230 318 Dividend yield (%) - - Weighted average fair value of shares at grant date $ 0.61 $ 0.91 |
NOTE 16_ DISCONTINUED OPERATI_3
NOTE 16: DISCONTINUED OPERATIONS: Summary of assets and liabilities sold, stock retired and gain recognized, in connection with the sale of assets to Sanammad parties (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Tables/Schedules | |
Summary of assets and liabilities sold, stock retired and gain recognized, in connection with the sale of assets to Sanammad parties | Other current assets $ 5,000 Total current assets $ 510,017 Intangible assets, net of amortization $ 47,375 Total asset $ 562,392 Notes payable $ 880,000 Accounts payable and accrued expenses $ 210,640 Due to Canchew $ 1,526,603 Stock retired $ 1,857 Total liabilities and equity 2,619,100 The gain on sale of assets was reported during the period was determined as follows: Loss on sale of assets $ 562,392 Gain on sale of liabilities $ 2,619,100 Net gain from sale of assets and liabilities $ 2,056,708 |
NOTE 16_ DISCONTINUED OPERATI_4
NOTE 16: DISCONTINUED OPERATIONS: Asset and liabilities reflected as discontinued operations (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Tables/Schedules | |
Asset and liabilities reflected as discontinued operations | December 31, 2020 December 31, 2019 Current asset of discontinued operations Accounts receivable $ - $ 315,843 Inventory - 487,814 Loan receivable - 5,000 Total current assets of discontinued operations $ - $ 808,657 Noncurrent assets of discontinued operations Other assets $ - $ 50,534 Total noncurrent assets of discontinued operations $ - $ 50,534 Current liabilities of discontinued operations Accounts payable and accrued liabilities $ - $ 552,577 Due to related party - 1,526,603 Promissory note related party note payable - 1,046,926 Total current liabilities of discontinued operations $ - $ 3,126,106 |
NOTE 16_ DISCONTINUED OPERATI_5
NOTE 16: DISCONTINUED OPERATIONS: Net cash provided by or use in operating activities, investing activities and financing activities for the assets and liabilities held for sale (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Tables/Schedules | |
Net cash provided by or use in operating activities, investing activities and financing activities for the assets and liabilities held for sale | December 31, 2020 December 31, 2019 Income (loss) from discontinued operations $ (119,293) $ (3,480,633) Adjustment of non-cash activities 726,748 72,762 Decrease (increase) in accounts receivable - (315,843) Increase in inventory - (478,017) Increase (decrease) in accounts payable and accrued expenses (1,823,057) 519,787 Net cash provided by (used in) operating activities $ (1,215,602) $ (3,681,944) Net cash provided by (used in) investing activities $ 27,490 $ (27,490) Net cash provided by (used in) financing activities $ (65,000) $ (78,917) |
NOTE 17_ COMMITMENT AND CONTI_2
NOTE 17: COMMITMENT AND CONTINGENCIES: Summary of right of use assets and liabilities (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Tables/Schedules | |
Summary of right of use assets and liabilities | Right-of-use assets $ 130,722 Lease liability obligations, current $ 53,851 Lease liability obligations, noncurrent 76,871 Total lease liability obligations $ 130,722 Weighted-average remaining lease term 2.33 years Weighted-average discount rate 6% |
NOTE 17_ COMMITMENT AND CONTI_3
NOTE 17: COMMITMENT AND CONTINGENCIES: Schedule of Lease expense (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Tables/Schedules | |
Schedule of Lease expense | December 31, 2020 December 31, 2019 Operating lease expense $ 32,991* $ - Short-term lease expense 20,831 35,696 Total lease expense $ 53,822 $ 35,696 |
NOTE 17_ COMMITMENT AND CONTI_4
NOTE 17: COMMITMENT AND CONTINGENCIES: Future minimum lease payments for right of use assets (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Tables/Schedules | |
Future minimum lease payments for right of use assets | Remainder of 2020 $ -0- 2021 57,684 2022 59,416 2023 20,000 Total minimum payments 137,100 Less: amount representing interest (6,378) Total $ 130,722 |
NOTE 18_ INCOME TAXES_ Schedule
NOTE 18: INCOME TAXES: Schedule of Effective Income Tax Rate Reconciliation (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Tables/Schedules | |
Schedule of Effective Income Tax Rate Reconciliation | Rate Reconciliation 2020 2019 Expected tax at statutory rates 21.00% 21% State Income Tax, Net of Federal benefit 6.98% 11.9% Current Year Change in Valuation Allowance -11.74% -32.9% Prior Year NOL True-Ups -16.24% |
NOTE 18_ INCOME TAXES_ Schedu_2
NOTE 18: INCOME TAXES: Schedule of Deferred Tax Assets and Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Tables/Schedules | |
Schedule of Deferred Tax Assets and Liabilities | Deferred Tax Assets/(Liab.) Detail 2020 2019 Stock Compensation 646,963 - Amortization 24,082 - Interest 66,376 - Net Operating Loss Carry Forward 6,038,109 6,022,948 Valuation Allowance (6,775,530) (6,022,948) Total gross deferred tax assets - - *The company moved its base operations to California in 2019 California Net operating Losses Total 8,355,508 NYS Net Operating Loss Total 14,157,020 |
NOTE 1_ ORGANIZATION (Details)
NOTE 1: ORGANIZATION (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Details | |
Entity Incorporation, State or Country Code | NV |
Entity Incorporation, Date of Incorporation | Nov. 18, 2010 |
Entity Information, Date to Change Former Legal or Registered Name | Jul. 24, 2014 |
NOTE 4_ GOING CONCERN (Details)
NOTE 4: GOING CONCERN (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Details | ||
Working Capital | $ (783,163) | |
Accumulated deficit | (41,849,922) | $ (35,440,042) |
Net cash provided by (used in) operating activities from continuing operations | $ (2,000,097) | $ (1,357,039) |
NOTE 5_ SIGNIFICANT ACCOUNTI_26
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Inventory (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Details | ||
Finished goods inventory | $ 0 | $ 175,304 |
Raw materials inventory | $ 0 | $ 312,511 |
NOTE 5_ SIGNIFICANT ACCOUNTI_27
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Revenue Recognition (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Details | ||
Revenue, Continuing Operations | $ 0 | $ 0 |
Disposal Group, Including Discontinued Operation, Revenue | $ 7,990 | $ 742,083 |
NOTE 5_ SIGNIFICANT ACCOUNTI_28
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Net Loss per Common Share (Details) - shares | Dec. 31, 2020 | Dec. 31, 2019 |
Details | ||
Common Share Equivalents | 32,556,727 | 16,295,498 |
NOTE 5_ SIGNIFICANT ACCOUNTI_29
NOTE 5: SIGNIFICANT ACCOUNTING POLICIES: Research and Development (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Details | ||
Research and development expenses | $ 426,708 | $ 0 |
NOTE 6_ PREPAID EXPENSES_ Sch_2
NOTE 6: PREPAID EXPENSES: Schedule of Prepaid Expenses (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Details | ||
Prepaid insurance | $ 45,983 | $ 67,734 |
Prepaid raw material/inventory | 209,940 | 9,872 |
Prepaid expenses | $ 255,923 | $ 77,606 |
NOTE 6_ PREPAID EXPENSES (Detai
NOTE 6: PREPAID EXPENSES (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Details | ||
Amortization of Prepaid Expenses | $ 120,559 | $ 111,929 |
NOTE 9_ PROMISSORY NOTE (Detail
NOTE 9: PROMISSORY NOTE (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Promissory note - related party | ||
Interest Expense, Promissory Note | $ 9,076 | $ 26,400 |
NOTE 11_ DUE TO FIRST INSURAN_2
NOTE 11: DUE TO FIRST INSURANCE FUNDING (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Details | ||
Insurance payments outstanding | $ 25,369 | $ 42,121 |
NOTE 12_ CONVERTIBLE NOTES PA_5
NOTE 12: CONVERTIBLE NOTES PAYABLE: Schedule of Convertible Notes Payable, Shareholder (Details) - Convertible notes payable due to shareholder - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Debt Instrument, Description | Convertible note payable, due on July 1, 2028, interest at 3.5% p.a. | |
Debt Instrument, Maturity Date | Jul. 1, 2028 | |
Debt Instrument, Interest Rate, Stated Percentage | 3.50% | |
Debt Instrument, Face Amount | $ 0 | $ 45,000 |
Interest Payable, Current | 0 | 5,578 |
Long-term Debt | $ 0 | $ 50,578 |
NOTE 12_ CONVERTIBLE NOTES PA_6
NOTE 12: CONVERTIBLE NOTES PAYABLE: Schedule of Convertible Notes Payable (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Convertible note payable, net | $ 4,158,648 | $ 4,093,333 |
Convertible Note 1 | ||
Debt Instrument, Description | Convertible note payable, due on November 1, 2026, interest at 3.5% p.a. | |
Debt Instrument, Maturity Date | Nov. 1, 2026 | |
Debt Instrument, Interest Rate, Stated Percentage | 3.50% | |
Debt Instrument, Face Amount | $ 4,000,000 | 4,000,000 |
Convertible Notes | ||
Accrued interest | $ 158,648 | $ 93,333 |
NOTE 12_ CONVERTIBLE NOTES PA_7
NOTE 12: CONVERTIBLE NOTES PAYABLE (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Details | ||
Investment Income, Net, Amortization of Discount and Premium | $ (86,059) | $ (75,272) |
NOTE 13_ STOCK INCENTIVE PLAN (
NOTE 13: STOCK INCENTIVE PLAN (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Details | ||
Stock Incentive Plan, Shares Available for Issuance | 9,806,000 | |
Share-based Payment Arrangement, Expense | $ 1,947,745 | $ 1,820,000 |
NOTE 14_ STOCKHOLDERS' DEFICIT_
NOTE 14: STOCKHOLDERS' DEFICIT: Preferred Stock (Details) - Preferred Stock - $ / shares | Dec. 31, 2020 | Dec. 31, 2019 |
Preferred Stock, Shares Authorized | 5,000,000 | 5,000,000 |
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 |
NOTE 14_ STOCKHOLDERS' DEFICI_2
NOTE 14: STOCKHOLDERS' DEFICIT: On August 17, 2016 the Company designated up to 500,000 shares of a new Series C Convertible Preferred Stock (Series C Preferred Stock) (Details) | Aug. 18, 2016shares |
Details | |
Shares issued, Series C Preferred Stock | 500,000 |
NOTE 14_ STOCKHOLDERS' DEFICI_3
NOTE 14: STOCKHOLDERS' DEFICIT: Common Stock (Details) - $ / shares | Dec. 31, 2020 | Dec. 31, 2019 |
Details | ||
Common Stock, Shares Authorized | 300,000,000 | |
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 |
Common Stock, Shares, Issued | 125,327,579 | 64,854,539 |
NOTE 15_ STOCK OPTIONS_ Sched_4
NOTE 15: STOCK OPTIONS: Schedule of Stock option activity (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Details | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Beginning Balance | 2,000,000 | 0 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price, Beginning Balance | $ 0.75 | $ 0 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 8,300,000 | 2,000,000 |
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ 0.27 | $ 0.75 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 0 | 0 |
Share-based Compensation Arrangements by Share-based Payment Award, Options, Exercises in Period, Weighted Average Exercise Price | $ 0 | $ 0 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Expirations in Period | 0 | 0 |
Share-based Compensation Arrangements by Share-based Payment Award, Options, Expirations in Period, Weighted Average Exercise Price | $ 0 | $ 0 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Ending Balance | 10,300,000 | 2,000,000 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price, Ending Balance | $ 0.36 | $ 0.75 |
NOTE 19_ SUBSEQUENT EVENTS (Det
NOTE 19: SUBSEQUENT EVENTS (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Event 1 | |
Subsequent Event, Description | Company issued 2,232,328 shares for cash of $622,500 pursuant to various Stock purchase agreements |
Event 2 | |
Subsequent Event, Description | company issued 1,300,193 restricted shares of its common stock valued at $843,974 to third parties for certain services |