Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2021 | Dec. 13, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q/A | |
Amendment Flag | true | |
Amendment Description | Amendment No. 2 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2021 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2021 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 001-38190 | |
Entity Registrant Name | Panacea Life Sciences Holdings, Inc. | |
Entity Central Index Key | 0001552189 | |
Entity Tax Identification Number | 27-1085858 | |
Entity Incorporation, State or Country Code | NV | |
Entity Address, Address Line One | 5910 S University Blvd | |
Entity Address, Address Line Two | C18-193 | |
Entity Address, City or Town | Greenwood Village | |
Entity Address, State or Province | CO | |
Entity Address, Postal Zip Code | 80121 | |
City Area Code | 800 | |
Local Phone Number | 985-0515 | |
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 Common Stock, Shares Outstanding | 14,073,708 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Sep. 30, 2021 | Jun. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Dec. 31, 2019 |
CURRENT ASSETS: | ||||||
Cash and cash equivalents | $ 14,500 | $ 84,379 | ||||
Accounts receivable, net | 515,095 | 147,302 | ||||
Other receivables, related party | 500,000 | |||||
Inventory, net | 4,344,378 | 8,409,734 | ||||
Marketable securities related party | 3,631,970 | 2,853,437 | ||||
Prepaid expenses and other current assets | 193,596 | 27,375 | ||||
TOTAL CURRENT ASSETS | 9,199,539 | 11,522,227 | ||||
Operating lease right-of-use asset, net, related party | 3,681,682 | 3,937,706 | ||||
Property and equipment, net | 9,024,505 | 13,590,286 | ||||
Intangible assets, net | 76,751 | 122,801 | ||||
Goodwill | 2,188,810 | 2,188,810 | ||||
TOTAL ASSETS | 24,171,287 | 31,361,830 | ||||
CURRENT LIABILITIES: | ||||||
Accounts payable and accrued expenses | 1,474,681 | 1,765,267 | ||||
Operating lease liability, current portion, related party | 1,508,743 | 1,162,869 | ||||
Note payable-current, related party | 6,216,155 | 15,061,044 | ||||
Paycheck protection loan, SBA Loan | 99,100 | 273,300 | ||||
TOTAL CURRENT LIABILITIES: | 9,298,679 | 18,262,480 | ||||
Operating lease liability, long-term portion, related party | 3,434,571 | 3,692,392 | ||||
Other long-term liabilities, related party | 3,042,638 | 2,698,659 | ||||
TOTAL LIABILITIES | 15,775,888 | 24,653,531 | ||||
Commitments and contingencies | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Common Stock: $0.0001 Par Value, 650,000,000 shares authorized; 21,393,041 and 16,915,706 shares issued and outstanding on September 30, 2021 and December 31, 2020 respectively. | 2,139 | 1,692 | ||||
Additional paid in capital | 23,066,914 | 18,689,119 | ||||
Accumulated deficit | (14,674,506) | (11,982,614) | ||||
TOTAL STOCKHOLDERS’ EQUITY | 8,395,399 | $ 11,485,155 | 6,708,299 | $ 6,795,797 | $ 10,575,512 | $ 11,940,129 |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | 24,171,287 | 31,361,830 | ||||
Series A Preferred Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Series D Preferred: $0.0001 Par Value, 10,000 shares designated and 10,000 and 10,000 shares issued and outstanding on September 30, 2021 and December 31, 2020 respectively. | ||||||
Series B-1 Preferred Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Series D Preferred: $0.0001 Par Value, 10,000 shares designated and 10,000 and 10,000 shares issued and outstanding on September 30, 2021 and December 31, 2020 respectively. | 150 | |||||
Series B-2 Preferred Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Series D Preferred: $0.0001 Par Value, 10,000 shares designated and 10,000 and 10,000 shares issued and outstanding on September 30, 2021 and December 31, 2020 respectively. | 600 | |||||
Series C Preferred Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Series D Preferred: $0.0001 Par Value, 10,000 shares designated and 10,000 and 10,000 shares issued and outstanding on September 30, 2021 and December 31, 2020 respectively. | 100 | 100 | ||||
Preferred Stock Series C 1 [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Series D Preferred: $0.0001 Par Value, 10,000 shares designated and 10,000 and 10,000 shares issued and outstanding on September 30, 2021 and December 31, 2020 respectively. | 1 | 1 | ||||
Series D Preferred Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Series D Preferred: $0.0001 Par Value, 10,000 shares designated and 10,000 and 10,000 shares issued and outstanding on September 30, 2021 and December 31, 2020 respectively. | $ 1 | $ 1 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2021 | Dec. 31, 2020 |
Preferred stock, par value | $ 0.0001 | |
Preferred stock, shares authorized | 50,000,000 | |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 650,000,000 | 650,000,000 |
Common stock, shares, issued | 21,393,041 | 16,915,706 |
Common stock, shares, outstanding | 21,393,041 | 16,915,706 |
Series A Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 1,000 | 1,000 |
Preferred stock, shares outstanding | 450 | 0 |
Preferred stock, shares issued | 450 | 0 |
Series B-1 Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 32,000,000 | 32,000,000 |
Preferred stock, shares outstanding | 1,500,000 | 0 |
Preferred stock, shares issued | 1,500,000 | 0 |
Series B-2 Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 6,000,000 | 6,000,000 |
Preferred stock, shares outstanding | 6,000,000 | 0 |
Preferred stock, shares issued | 6,000,000 | 0 |
Series C Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares outstanding | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 1,000,000 | 1,000,000 |
Series C-1 Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 10,000 | 10,000 |
Preferred stock, shares outstanding | 10,000 | 10,000 |
Preferred stock, shares issued | 10,000 | 10,000 |
Series D Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 10,000 | 10,000 |
Preferred stock, shares outstanding | 10,000 | 10,000 |
Preferred stock, shares issued | 10,000 | 10,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Income Statement [Abstract] | |||||
REVENUE | $ 588,040 | $ 1,343,641 | $ 1,413,674 | $ 8,305,630 | |
COST OF SALES | 305,025 | 2,905,780 | 883,508 | 6,285,879 | |
GROSS PROFIT (LOSS) | 283,015 | (1,562,139) | 530,166 | 2,019,751 | |
OPERATING EXPENSES | |||||
Production related operating expenses | 1,250,434 | 1,307,169 | 3,407,407 | 3,012,485 | |
General and administrative expenses | 290,638 | 478,992 | 911,906 | 2,547,438 | |
TOTAL OPERATING EXPENSES | 1,541,072 | 1,786,161 | 4,319,313 | 5,559,923 | |
LOSS FROM OPERATIONS | (1,258,057) | (3,348,300) | (3,789,147) | (3,540,172) | |
OTHER INCOME (EXPENSES) | |||||
Interest expense | (174,727) | (432,922) | (781,671) | (1,181,165) | |
Unrealized gain (loss) on marketable securities, net | (2,303,218) | (160,310) | 848,533 | (595,590) | |
Realized gain on sale of securities | 160,296 | 160,296 | |||
Other income (loss) | 56,619 | (21,090) | |||
Employer retention credit | 190,338 | 190,338 | |||
Rental Income | 58,410 | 56,577 | 221,328 | 212,778 | |
Loss on sale of assets | 48,621 | (297,351) | (19,093) | $ (140,714) | |
Gain on extinguishment of debt | 237,202 | 755,782 | |||
TOTAL OTHER INCOME (EXPENSE) | (1,831,699) | (431,415) | 1,097,255 | (1,604,160) | |
LOSS BEFORE INCOME TAXES | (3,089,756) | (3,779,715) | (2,691,892) | (5,144,332) | |
TAXES | |||||
NET LOSS | $ (3,089,756) | $ (3,779,715) | $ (2,691,892) | $ (5,144,332) | |
BASIC NET LOSS PER SHARE | $ (0.14) | $ (0.22) | $ (0.15) | $ (0.30) | |
DILUTED NET LOSS PER SHARE | $ (0.14) | $ (0.22) | $ (0.15) | $ (0.30) | |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING | |||||
Basic | 21,389,041 | 16,915,706 | 18,422,459 | 16,915,706 | |
Diluted | 21,389,041 | 16,915,706 | 18,422,459 | 16,915,706 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholder's (Deficit) Equity (Unaudited) - USD ($) | Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Total |
Beginning balance, value at Dec. 31, 2019 | $ 102 | $ 1,692 | $ 18,689,119 | $ (6,750,784) | $ 11,940,129 |
Beginning balance, shares at Dec. 31, 2019 | 1,020,000 | 16,915,706 | |||
Shares issued for acquisition | |||||
Net Income (Loss) | (5,144,332) | (5,144,332) | |||
Ending balance, value at Sep. 30, 2020 | $ 102 | $ 1,692 | 18,689,119 | (11,895,116) | 6,795,797 |
Ending balance, shares at Sep. 30, 2020 | 1,020,000 | 16,915,706 | |||
Beginning balance, value at Jun. 30, 2020 | $ 102 | $ 1,692 | 18,689,119 | (8,115,401) | 10,575,512 |
Beginning balance, shares at Jun. 30, 2020 | 1,020,000 | 16,915,706 | |||
Shares issued for acquisition | |||||
Net Income (Loss) | (3,779,715) | (3,779,715) | |||
Ending balance, value at Sep. 30, 2020 | $ 102 | $ 1,692 | 18,689,119 | (11,895,116) | 6,795,797 |
Ending balance, shares at Sep. 30, 2020 | 1,020,000 | 16,915,706 | |||
Beginning balance, value at Dec. 31, 2020 | $ 102 | $ 1,692 | 18,689,119 | (11,982,614) | 6,708,299 |
Beginning balance, shares at Dec. 31, 2020 | 1,020,000 | 16,915,706 | |||
Ending balance, value at Jun. 30, 2021 | $ 852 | $ 2,132 | 23,066,921 | (11,584,750) | 11,485,155 |
Ending balance, shares at Jun. 30, 2021 | 8,520,450 | 21,321,613 | |||
Beginning balance, value at Dec. 31, 2020 | $ 102 | $ 1,692 | 18,689,119 | (11,982,614) | 6,708,299 |
Beginning balance, shares at Dec. 31, 2020 | 1,020,000 | 16,915,706 | |||
Shares issued for acquisition | $ 750 | $ 440 | 4,377,802 | 4,378,992 | |
Series A Preferred stock conversion to common stock | $ 7 | (7) | |||
Series A Preferred stock conversion to common stock, shares | (100) | 71,429 | 71,429 | ||
Net Income (Loss) | (2,691,892) | $ (2,691,892) | |||
Ending balance, value at Sep. 30, 2021 | $ 852 | $ 2,139 | 23,066,914 | (14,674,506) | 8,395,399 |
Ending balance, shares at Sep. 30, 2021 | 8,520,350 | 21,393,042 | |||
Shares issued for acquisition, shares | 7,500,450 | 4,405,907 | |||
Beginning balance, value at Jun. 30, 2021 | $ 852 | $ 2,132 | 23,066,921 | (11,584,750) | 11,485,155 |
Beginning balance, shares at Jun. 30, 2021 | 8,520,450 | 21,321,613 | |||
Series A Preferred stock conversion to common stock | $ 7 | (7) | |||
Series A Preferred stock conversion to common stock, shares | (100) | 71,429 | |||
Net Income (Loss) | (3,089,756) | (3,089,756) | |||
Ending balance, value at Sep. 30, 2021 | $ 852 | $ 2,139 | $ 23,066,914 | $ (14,674,506) | $ 8,395,399 |
Ending balance, shares at Sep. 30, 2021 | 8,520,350 | 21,393,042 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Cash flows from operating activities | ||
Net loss | $ (2,691,892) | $ (5,144,332) |
Adjustments to reconcile net income (loss) to net cash used in operating activities | ||
Depreciation | 1,280,324 | 1,018,567 |
Realized gain on sale of securities | (160,296) | |
Fixed asset disposal loss | 297,351 | 19,093 |
Amortization of intangible assets | 46,050 | 46,050 |
Non-cash settlement of convertible note and accrued interest | (752,751) | |
Unrealized gain/loss on marketable securities | (848,533) | 595,590 |
Changes in operating assets and liabilities | ||
Accounts receivable | (367,793) | 91,952 |
Inventory | (628,011) | (5,463,820) |
Prepaid expense and other assets | (166,221) | 647,257 |
Accounts payable and accrued expenses | 955,493 | 1,226,146 |
Operating lease liability, net | 344,076 | 344,085 |
Net cash used in operating activities | (2,692,203) | (6,619,412) |
Cash flows from investing activities | ||
Net cash received in from acquisitions | 9,157 | |
Proceeds from sale of marketable securities | 230,296 | |
Proceeds from sale of fixed assets | 446,026 | 34,920 |
Net fixed asset acquisition | (172,397) | (3,301,527) |
Net Cash provided by (used in) investing activities | 513,082 | (3,266,607) |
Cash flows from financing activities | ||
Proceeds from payroll protection loan, SBA loan | 273,300 | |
Proceeds from payroll protection loan - related party | 243,041 | |
Payments of principal on notes payable - related party | (135,000) | (3,503,545) |
Proceeds from notes payable - related party | 2,001,201 | 5,134,225 |
Net cash provided by financing activities | 2,109,242 | 1,903,980 |
Net decrease in Cash and Cash Equivalents | (69,879) | (7,982,039) |
Cash and Cash Equivalents, Beginning of Period | 84,379 | 8,515,509 |
Cash and Cash Equivalents, End of Period | 14,500 | 533,470 |
Supplemental Disclosure of Cash Flow Information | ||
Cash paid for income taxes during the year | ||
Interest payments during the year | 525,000 | |
Noncash investing and financing activity | ||
Non-cash receivable - related party | (500,000) | |
Related party loan repayment with inventory | 4,693,367 | |
Non-cash fixed asset disposal as part of the reverse acquisition | 3,058,457 | |
Capitalized assets purchased on account - related party | 343,979 | 396,270 |
Liabilities from acquisition | 1,096,782 | |
Debt retired in merger, related party | (12,718,441) | |
Preferred Series B-1 Issuance in Acquisition | 150 | |
Preferred Series B-2 Issuance in Acquisition | 600 | |
Common stock issued for the reverse merger with Exactus | $ 4,369,085 |
NATURE OF ORGANIZATION
NATURE OF ORGANIZATION | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF ORGANIZATION | NOTE 1 - NATURE OF ORGANIZATION Organization and Business Description PANACEA LIFE SCIENCES HOLDINGS, Inc. (the “Company”, “Exactus”, “we”, “us”, “our”) was incorporated on January 18, 2008 in the State of Nevada. In January 2019, the Company added to the scope of its business activities, efforts to produce, market and sell products made from industrial hemp containing cannabidiol (“CBD”). On June 30, 2021 the Company entered into a Securities Exchange Agreement (the “Exchange Agreement”) with Panacea Life Sciences, Inc. (“Panacea”) a CBD company, and the stockholders of Panacea. Pursuant to the Exchange Agreement, the former Panacea stockholders assumed majority control of the Exactus and all operations are now operated by Panacea, which as a result of the share exchange became a wholly-owned subsidiary of the Exactus. (See Note 10 – Exchange Agreement). |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of presentation and principles of consolidation The Company’s unaudited condensed consolidated financial statements include the financial statements of Panacea Life Sciences, Inc., a wholly owned subsidiary acquired on June 30, 2021. The accompanying interim unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America and the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) for interim financial information, which includes consolidated unaudited interim financial statements and present the consolidated unaudited interim financial statements of the Company and its wholly-owned subsidiary as of September 30, 2021. Accordingly, they do not include all of the information and notes required by accounting principles generally accepted in the United States of America. All intercompany transactions and balances have been eliminated. In the opinion of management, all adjustments necessary to present fairly our financial position, results of operations, stockholders’ equity and cash flows as of September 30, 2021, and 2020, and for the periods then ended, have been made. Those adjustments consist of normal and recurring adjustments. Operating results for the three and nine months ended September 30, 2021 and 2020 are not necessarily indicative of the results that may be expected for any subsequent quarters or for the year ending December 31, 2021. Certain information and note disclosures normally included in our annual financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. Going concern These unaudited condensed consolidated financial statements are presented on the basis that the Company will continue as a going concern. Panacea has combined with Panacea Life Sciences Holdings, Inc. (formerly Exactus), so the below items reflect the consolidated company. The going concern concept contemplates the realization of assets and satisfaction of liabilities in the normal course of business. Since our inception in later 2017, we have generated losses from operations. As of September 30, 2021, our accumulated deficit was $ 14.675 3.646 nd 1,227,017 3.631 4.063 1.624 1.1 COVID-19 The COVID-19 pandemic has resulted in a global slowdown of economic activity which is likely to continue to reduce the future demand for a broad variety of goods and services, while also disrupting sales channels, marketing activities and supply chains for an unknown period of time until the virus is fully contained. The Company’s business operations have been negatively impacted by the COVID-19 pandemic and related events and the Company expects this impact on its revenue and results of operations, the size and duration of which is currently difficult to predict. However, adverse consequences from COVID-19 and recent supply chain disruptions and delays may hinder our ability to continue our operations and generate revenue. The impact to date has included a decline in CBD product and sales demand. Further, in 2020, the Company (Panacea) invested in personal protective equipment (PPE) materials to sell hand sanitizers, testing kits and masks, and sales of PPE products, which constituted a significant portion of our revenue during the fiscal quarter ended June 30, 2021 and prior periods during the pandemic, have declined as vaccines continue to be administered and mask mandates and similar requirements have been lifted or reduced in many places. Although the Company is unable to predict the full impact and duration of COVID-19 on its business, the Company is actively managing its financial expenditures in response to the current uncertainty. The impact of the COVID-19 pandemic and related events, including actions taken by various government authorities in response, have increased market volatility and make the estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes more difficult. As of the date of issuance of the financial statements, the Company is not aware of any specific event or circumstance that would require it to update its estimates, judgments or revise the carrying value of its assets or liabilities. These estimates may change, as new events occur and additional information is obtained, and are recognized in the condensed consolidated financial statements as soon as they become known. Marketable securities The Company’s marketable securities consists of 1,227,017 Going Concern Use of Estimates The Unaudited Condensed Consolidated Financial Statements have been prepared in conformity with US GAAP and required management of the Company to make estimates and assumptions in preparation of these statements. Actual results may differ significantly from those estimates. Significant estimates made by management include but are not limited to the useful life of property and equipment, incremental borrowing rate used in the calculation of right of use asset and lease liability, reserves for inventory, allowance for doubtful accounts, revenue allocations, valuation allowance on deferred tax assets, assumptions used in assessing impairment of long-term assets, assumptions used in the calculation of net realizable value of inventory and fair value of non-cash equity transactions. Fair Value Measurements The Company adopted the provisions of Accounting Standard Codification (“ASC”) Topic 820, “Fair Value Measurements and Disclosures”, which defines fair value as used in numerous accounting pronouncements, establishes a framework for measuring fair value, and expands disclosure of fair value measurements. The guidance prioritizes the inputs used in measuring fair value and establishes a three-tier value hierarchy that distinguishes among the following: ● Level 1—Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. ● Level 2—Valuations based on quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active and models for which all significant inputs are observable, either directly or indirectly. ● Level 3—Valuations based on inputs that are unobservable and significant to the overall fair value measurement. The following table shows, by level within the fair value hierarchy, the Company’s assets and liabilities at fair value on a recurring basis as of September 30, 2021 and December 31, 2020: FAIR VALUE, ASSETS MEASURED ON RECURRING BASIS September 30, 2021 December 31, 2020 Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Marketable securities $ 3,631,970 $ 3,631,970 $ - - $ 2,853,437 $ 2,853,437 $ - $ - Total $ 3,631,970 $ 3,631,970 $ - $ - $ 2,853,437 $ 2,853,437 $ - $ - In August, 2021 there was one sale of marketable securities out of Level 1. There were no transfers in 2020. On August 5, 2021 70,000 3.29 230,296 160,296 SCHEDULE OF MARKETABLE SECURITIES September 30, 2021 Balance at beginning of year $ 2,853,437 Sale of securities (230,296 ) Realized gain on sale of securities 160,296 Unrealized gain on marketable securities, net 848,533 Balance at end of period $ 3,631,970 As of September 30, 2021, the Company has no liabilities that are re-measured at fair value. Income Taxes Income taxes are accounted for under the asset and liability method prescribed by FASB ASC Topic 740. These standards require a company to determine whether it is more likely than not that a tax position will be sustained upon examination based upon the technical merits of the position. If the more likely than not threshold is met, a company must measure the tax position to determine the amount to recognize in the financial statements. Deferred income taxes are recorded for temporary differences between financial statement carrying amounts and the tax basis of assets and liabilities. Deferred tax assets and liabilities reflect the tax rates expected to be in effect for the years in which the differences are expected to reverse. A valuation allowance is provided if it is more likely than not that some or all of the deferred tax asset will not be realized. Revenue Recognition The Company accounts for revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers The Company accounts for a contract when it has been approved and committed to, each party’s rights regarding the goods or services to be transferred have been identified, the payment terms have been identified, the contract has commercial substance, and collectability is probable. Revenue is generally recognized net of allowances for returns and any taxes collected from customers and subsequently remitted to governmental authorities. However, the Company’s sales are primarily through retail stores, purchase orders or ecommerce; thus, currently contract liabilities are negligible. The Company does not have any multiple-element arrangements. Some of the Company’s contract liabilities consist of advance customer payments. Contract liability results from transactions in which the Company has been paid for products by customers, but for which all revenue recognition criteria have not yet been met. Once all revenue recognition criteria have been met, the contract liabilities are recognized. The company recorded $ 31,725 463,454 SCHEDULE OF REVENUE FROM CONTRACT WITH CUSTOMER September 30, 2021 December 31, 2020 Balance, beginning of period $ 121,300 $ 254,786 Payments received for unearned revenue 31,725 463,454 Revenue earned 132,955 596,940 Balance, end of period $ 20,070 $ 121,300 Revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration that an entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for those goods. The Company applies the following five-step model in order to determine this amount: (i) identification of the promised goods in the contract; (ii) determination of whether the promised goods are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation. Revenue related to the sale of products is recognized once goods have been sold to the customer and the performance obligation has been completed. In both contracted purchase and retail sales, we offer consumer products through our online stores. Revenue is recognized when control of the goods is transferred to the customer. This generally occurs upon our delivery to a third-party carrier or, to the customer directly. Revenue from tolling services is recognized when the performance obligation, such as processing of the material, has been completed and output material has been transferred to the customer. Revenue is generally recognized net of allowances for returns and any taxes collected from customers and subsequently remitted to governmental authorities. Some of the Company’s contract liabilities consist of advance customer payments. A contract liability results from transactions in which the Company has been paid for products by customers, but for which all revenue recognition criteria have not yet been met. Once all revenue recognition criteria have been met, the contract liabilities are recognized. However, the Company’s sales are primarily through retail stores, purchase orders or ecommerce; thus, currently contract liabilities are negligible. The Company does not have any multiple-element arrangements. Some of the Company’s contract liabilities consist of advance customer payments. Contract liability results from transactions in which the Company has been paid for products by customers, but for which all revenue recognition criteria have not yet been met. Once all revenue recognition criteria have been met, the contract liabilities are recognized. The Company also has recorded other income related to rental income it receives from leasing out space in the laboratory it occupies. Accounts Receivable Accounts receivable are generally unsecured. The Company establishes an allowance for doubtful accounts receivable based on the age of outstanding invoices and management’s evaluation of collectability. Accounts are written off after all reasonable collection efforts have been exhausted and management concludes that likelihood of collection is remote. Any future recoveries are applied against the allowance for doubtful accounts. As of September 30, 2021 and December 31, 2020, we did not believe we needed to reserve for any doubtful accounts, respectively. The Company’s accounts receivable policy changed in 2020 to only provide larger, well-established companies with Net 30 payment terms. For all other sales they are paid by credit card or wires received before the product is shipped to the customer. Shipping and Handling Costs The Company accounts for shipping and handling fees in accordance with ASC 606. The amounts charged to customers for shipping products are recognized as revenues and the related freight costs of shipping products are classified in general and administrative costs as incurred. Shipping costs are included as a component of general and administrative and were $ 12,603 54,429 Segment Information The Company follows the provisions of ASC 280-10 Segment Reporting. Cash and Cash Equivalents For purposes of balance sheet presentation and reporting of cash flows, the Company considers all unrestricted demand deposits, money market funds and highly liquid debt instruments with an original maturity of less than 90 days to be cash and cash equivalents. There were no cash equivalents. The Company places its cash and cash equivalents with high-quality financial institutions. At times, balances in the Company’s cash accounts may exceed the Federal Deposit Insurance Corporation (“FDIC”) limit. On September 30, 2021, the Company’s cash balances did not exceed the FDIC limit. Advertising & Marketing Advertising costs are expensed when incurred and are included in advertising and promotional expense in the accompanying statements of operations. Included in this category are expenses related to public relations, investor relations, new package design, website design, design of promotional materials, cost of trade shows, cost of products given away as promotional samples, and paid advertising. The Company recorded advertising costs included in general and administrative costs of $ 292,157 1,375,962 Earnings per Share The Company computes basic and diluted earnings per share amounts in accordance with ASC Topic 260, “Earnings per Share”. Basic earnings per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding during the reporting period. Diluted earnings per share reflects the potential dilution that could occur if preferred stock converted to common stock and warrants are exercised. Preferred stock and warrants are excluded from the diluted earnings per share calculation if their effect is anti-dilutive. The Business Combination on June 30, 2021 was accounted for as a recapitalization of equity structure. In October, 2021 the Company completed 1-for-28 reverse stock split. The following financial instruments were not included in the diluted loss per share calculation for the three months ending September 30, 2021 and 2020 because their effect was anti-dilutive: SCHEDULE OF ANTI-DILUTIVE DILUTED LOSS PER SHARE 2021 2020 For the three months ended September 30, 2021 2020 Options to purchase common stock 61,446 - Warrants to purchase common stock 56,377 - Series A Convertible Preferred 256,211 - Series B-1 Convertible Preferred 6,679 - Series B-2 Convertible Preferred 26,786 - Series C Convertible Preferred 2,289,220 - Series C-1 Convertible Preferred 1,064,908 - Series D Convertible Preferred 1,628,126 - Total 5,389,753 - The following financial instruments were not included in the diluted loss per share calculation for the nine months ending September 30, 2021 and 2020 because their effect was anti-dilutive: 2021 2020 For the nine months ended September 30, 2021 2020 Options to purchase common stock 61,446 - Warrants to purchase common stock 56,377 - Series A Convertible Preferred 250,000 - Series B-1 Convertible Preferred 6,679 - Series B-2 Convertible Preferred 26,786 - Series C Convertible Preferred 2,289,220 - Series C-1 Convertible Preferred 1,064,908 - Series D Convertible Preferred 1,628,126 - Total 5,383,541 - Recently Issued Accounting Standards In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40), Accounting for Convertible Instruments and Contract’s in an Entity’s Own Equity. The ASU simplifies accounting for convertible instruments by removing major separation models required under current GAAP. Consequently, more convertible debt instruments will be reported as a single liability instrument with no separate accounting for embedded conversion features. The ASU removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception, which will permit more equity contracts to qualify for it. The ASU simplifies the diluted net income per share calculation in certain areas. The ASU is effective for annual and interim periods beginning after December 31, 2021, and early adoption is permitted for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. The Company does not expect the adoption of ASU 2020-6 to have any material impact on its consolidated financial statements. In May 2021, the Financial Accounting Standards Board (“FASB”) issued ASU 2021-04 “Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation— Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815- 40) Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options” which clarifies and reduces diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options (for example, warrants) that remain equity classified after modification or exchange. An entity should measure the effect of a modification or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange as follows: i) for a modification or an exchange that is a part of or directly related to a modification or an exchange of an existing debt instrument or line-of-credit or revolving-debt arrangements (hereinafter, referred to as a “debt” or “debt instrument”), as the difference between the fair value of the modified or exchanged written call option and the fair value of that written call option immediately before it is modified or exchanged; ii) for all other modifications or exchanges, as the excess, if any, of the fair value of the modified or exchanged written call option over the fair value of that written call option immediately before it is modified or exchanged. The amendments in this Update are effective for all entities for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. An entity should apply the amendments prospectively to modifications or exchanges occurring on or after the effective date of the amendments. The Company is currently evaluating the impact of this standard on its consolidated financial statements. The Company does not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to its financial condition, results of operations, cash flows or disclosures. Intangible Assets and Goodwill The Company has intangible assets. Goodwill is comprised of the purchase price of business combinations in excess of the fair market value assigned at acquisition to the tangible and intangible assets acquired. Goodwill is not amortized. The Company tests goodwill for impairment on an annual basis. The Company performed its most recent goodwill impairment using a discounted cash flow analysis and found that the fair value exceeded the carrying value. It has $ 2.189 0.077 0.123 SCHEDULE OF INTANGIBLE ASSETS AND GOODWILL Estimated Life Goodwill from Phoenix Acquisition Tested Yearly for Impairment Intangibles – Formulations 5 September 30, 2021 December 31, 2020 Goodwill $ 2,188,810 $ 2,188,810 Intangibles – Formulations 307,001 307,001 Less accumulated amortization (230,250 ) (184,200 ) Net intangible assets $ 76,751 $ 122,801 |
PROPERTY, EQUIPMENT, NET OF ACC
PROPERTY, EQUIPMENT, NET OF ACCUMULATED DEPRECIATION | 9 Months Ended |
Sep. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY, EQUIPMENT, NET OF ACCUMULATED DEPRECIATION | NOTE 3 – PROPERTY, EQUIPMENT, NET OF ACCUMULATED DEPRECIATION Property and equipment, net including any major improvements, are recorded at historical cost. The cost of repairs and maintenance is charged against operations as incurred. Depreciation is calculated using the straight-line method over the estimated useful lives of the related assets, generally as follows: SCHEDULE OF PROPERTY PLANT AND EQUIPMENT USEFUL LIVES Estimated Life Computers and technological assets 3 5 Furniture and fixtures 3 5 Machinery and equipment 5 10 Leasehold improvement 10 Property and equipment, net consists of the following: SCHEDULE OF PROPERTY AND EQUIPMENT September 30, 2021 December 31, 2020 Computers and technological assets $ 3,310,025 $ 2,993,626 Furniture and fixtures 55,951 55,951 Machinery and equipment 7,524,242 8,494,296 Land 92,222 2,293,472 Assets under construction - 743,377 Leasehold improvements 1,508,915 1,508,915 Total 12,491,355 16,089,637 Less accumulated depreciation (3,466,850 ) (2,499,351 ) Total property and equipment, net $ 9,024,505 $ 13,590,286 The land and equipment decreased from December 31, 2020 to September 30, 2021 due to the partial sale of the farmland and equipment. See Note 10. Depreciation expenses for the three- and nine-month periods ending September 30, 2021 and 2020 were $ 392,485 , $ 1,280,324 , $ 371,314 and $ 1,018,567 respectively. During the nine months ended September 30, 2021, the Company sold fixed assets of $ 743,377 297,351 260,337 140,714 |
INVENTORY
INVENTORY | 9 Months Ended |
Sep. 30, 2021 | |
Inventory Disclosure [Abstract] | |
INVENTORY | NOTE 4 - INVENTORY Inventory consists of the following components: SCHEDULE OF INVENTORY September 30, 2021 December 31, 2020 Raw Materials $ 1,006,096 $ 991,523 Semi-Finished 1,317,948 1,372,950 Finished Goods 1,998,260 6,018,530 Packaging 16,281 20,938 Trading 5,793 5,793 Total $ 4,344,378 $ 8,409,734 Inventories are stated at lower of cost or net realizable value using the standard costing method for its work in process and finished goods. For its raw materials, trading goods, and packaging supplies, the Company utilizes the moving average method for costing purposes and FIFO. At this time there are no inventory reserves required. |
OPERATING LEASE RIGHT-OF-USE AS
OPERATING LEASE RIGHT-OF-USE ASSETS AND OPERATING LEASE LIABILITIES – RELATED PARTY | 9 Months Ended |
Sep. 30, 2021 | |
Operating Lease Right-of-use Assets And Operating Lease Liabilities Related Party | |
OPERATING LEASE RIGHT-OF-USE ASSETS AND OPERATING LEASE LIABILITIES – RELATED PARTY | NOTE 5 – OPERATING LEASE RIGHT-OF-USE ASSETS AND OPERATING LEASE LIABILITIES – RELATED PARTY Right of Use The Company adopted Accounting Standards Update (“ASU”) No. 2016-02, “Leases” (“ASC 842”) on January 1, 2019, the start of our 2019 fiscal year. The Company has one lease arrangement with a related party entered into on December 22, 2018 for 3-year term starting with January 1, 2019 for certain laboratory facilities, with a nine-year 4,595,509 . The Company, as of January 1, 2019, leases a portion of the property (formerly the Environmental Protection Agency building) in Golden, CO from J&N Real Estate, owned by the CEO, a related party with a term expiring on December 31, 2030. The lease consists of all laboratory space including testing facilities, water treatment, extraction and production. The lease of the property is based on the fair market rent and triple net lease (NNN) values competitive in the marketplace for a cGMP facility. The Company also subleases some of its laboratory space to other CBD companies. This income is presented under the Other Income line items of the statements of operations. The leases vary from short-term monthly leases to 3 -year leases but are all cancellable. Below is a summary of our right of use assets and liabilities as of September 30, 2021. SCHEDULE OF RIGHT OF USE ASSET AND LIABILITY September 30, 2021 December 31, 2020 Right-of-use assets $ 3,681,682 $ 3,937,706 Present value of operating lease liabilities $ 3,775,942 $ 4,022,870 Less: Long-term portion of operating lease liability (3,434,571 ) (3,692,392 ) Short-term portion of operating lease liability 341,371 330,478 Unpaid balances 1,167,372 832,391 Total short-term lease liability obligations $ 1,508,743 $ 1,162,869 Weighted-average remaining lease term (Ends December 31, 2030) 9.25 10 Weighted-average discount rate 3.0 % Right-of-use assets $ 3,681,682 Total lease liability obligations $ 4,943,314 Weighted-average remaining lease term (Ends December 31, 2030) 9.25 During the three and nine months ended September 30, 2021, we recognized approximately $ 114,693 344,079 458,772 Approximate future minimum lease payments for our right of use assets over the remaining lease periods as of September 30, 2021, are as follows: SCHEDULE OF MATURITY OF OPERATING LEASE LIABILITIES 2021 $ 111,661 2022 451,110 2023 455,622 2024 460,178 2025 464,780 Thereafter 2,394,550 Total undiscounted operating lease payments 4,337,901 Less: Imputed interest (561,959 ) Present value of operating lease liabilities $ 3,775,942 |
NOTES PAYABLE
NOTES PAYABLE | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
NOTES PAYABLE | NOTE 6 – NOTES PAYABLE The Company’s debt obligations are summarized as follows. The December 31, 2020, numbers reflect the pre-merger Panacea indebtedness, while the September 30, 2021, now include the Panacea indebtedness, as well as Exactus’ indebtedness. U.S. Small Business Administration Loan On May 28, 2020, the Company received a secured, 30 99,100 3.75 483 monthly 99,100 2,047 Paycheck Protection Program Funding The Exactus Company was approved for “second draw” loan of $ 236,410 Regarding Panacea Life Sciences, Inc.’s (PLS) on January 26, 2021, PLS received approval for the PPP second draw loan in the amount of $ 243,041 PLS’s accounting treatment of the PPP loans and forgiveness follows best practice from the AICPA and accounted for the loan as a financial liability in accordance with FASB ASC 470 and accrue interest in accordance with the interest method under FASB ASC 835-30. The full amount of the PPP loan and accrued interest was forgiven on September 28, 2021; whereby, the debt was extinguished including any accrued but unpaid interest. It was recorded as a forgiveness of loan in the Company’s statements of operations as other income. Employer Retention Credit Panacea received an employer retention credit from the federal government of $ 190,388 Notes payable – related party and other liability On June 30, 2021 Panacea received a loan from Quintel-MC Incorporated, an affiliate of the Company’s CEO, in exchange for a 12% demand promissory note for $ 4,062,714 Going concern 10 1,685,685 Going concern 1,000,000 During October 2019, the Company issued a short-term promissory note to an officer of the previous company Exactus, for an aggregate principal amount of $ 55,556 October 18, 2019 December 16, 2019 12 18 18 10 5,556 55,556 During February 2021, the Company entered into a short-term promissory note for principal amount of $ 20,000 8 20,000 533 The SBA is a 30-year loan, but we plan to pay off this loan in 2022. The rest of the loans do not have a maturity date assigned to them and are payable upon demand. The Company has recorded another liability which includes building leasehold improvements and SAP software and support fees. Refer to Note 9. SCHEDULE OF NOTES PAYABLE September 30, 2021 December 31, 2020 Notes payable - related party (1) $ 4,062,713 $ 7,911,044 Notes payable – related party (2) 2,077,886 150,000 Notes payable -related party (3) - 7,000,000 Notes payable - related party (4) 75,556 - Total related party notes $ 6,216,155 $ 15,061,044 Paycheck protection loan (5) $ - $ 273,300 SBA loan (4) 99,100 - Total Paycheck protection and SBA loan $ 99,100 $ 273,300 September 30, 2021 December 31, 2020 Other liability—related party SAP software, support and building modifications (6) $ 2,529,248 $ 2,185,269 J&N Building Loan (7) 513,390 513,390 Total $ 3,042,638 $ 2,698,659 (1) Payable to Quintel. As part of the agreement in the reverse merger transaction the Quintel loans and historical interest owed of $ 1,932,358 4.062 4.7 (2) Payable to CEO, secured by XXII common stock. (3) Convertible debt owed to XXII. On June 30, 2021 the $ 7 2.2 500,000 4.3 (4) Liability carried over from Exactus (5) Paycheck protection loans include Exactus’ and Panacea’s loans. (6) Accrued expenses related to SAP software and implementation services. Software enhancements for production related functionality and user interface were added in 2020 and 2021. In 2019 the initial implementation of the system was completed. (7) The J&N Real Estate Company loan for Panacea Building capital was made in 2020 |
STOCKHOLDERS_ EQUITY
STOCKHOLDERS’ EQUITY | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
STOCKHOLDERS’ EQUITY | NOTE 7 - STOCKHOLDERS’ EQUITY Common stock The Company’s authorized common stock consists of 650,000,000 0.0001 During the quarter ended September 30, 2021, 100 71,429 Common stock options Stock Option Plan On June 30, 2021 the Company’s stockholders approved the 2021 Equity Incentive Plan (the “2021 Plan”). The 2021 Plan provides for the issuance of 339,522 144,621 10 As part of the merger of Exactus, Panacea assumed the Exactus 2018 Equity Incentive Plan (the “2018 Plan”). The 2018 Plan provides for the issuance of incentive awards in the form of non-qualified and incentive stock options, stock appreciation rights, restricted stock awards, and restricted stock unit awards. The awards may be granted by the Company’s Board of Directors to its employees, directors and officers and to consultants, agents, advisors and independent contractors who provide services to the Company or to a subsidiary of the Company. The exercise price for stock options must not be less than the fair market value of the underlying shares on the date of grant. The incentive awards shall either be fully vested and exercisable from the date of grant or shall vest and become exercisable in such installments as the Board or Compensation Committee may specify. Stock options expire no later than ten years from the date of grant. The aggregate number of shares of common stock which may be issued pursuant to the Plan is 339,285 10 196,491 Stock Options A summary of the stock option activity is presented below: SCHEDULE OF STOCK OPTIONS Options Outstanding as of September 30, 2021 Number of Shares Subject to Options Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Life (in years) Aggregate Balance on December 31, 2020 - - - - Options assumed in merger 196,491 $ 3.64 3.70 192,500 Options granted - - - - Options exercised - - - - Options canceled / expired - - - - Balance at September 30, 2021 196,491 $ 3.64 3.45 $ 192,500 Vested and exercisable at September 30, 2021 196,491 $ 3.64 3.45 $ 192,500 Stock Warrants As a result of the Merger closing (see Note 10), as of September 30, 2021, the Company had outstanding warrants to purchase an aggregate of 56,377 (post-split) shares of common stock ( 1,578,549 shares pre-split). The warrants were previously issued by Exactus, Inc. and assumed in the Merger. The Company’s outstanding warrants as of September 30, 2021 are summarized as follows, and all were exercisable at that date. SUMMARY OF STOCK WARRANTS Name Expire Number of Shares Average Exercise Balance on December 31, 2020 - - - Assumed in Merger 56,337 $ 13.64 Total as of September 30, 2020 56,337 $ 13.64 As of September 30, 2021, the outstanding warrants have no Restricted Stock A summary of the restricted stock activity is presented below: SUMMARY OF RESTRICTED STOCK Restricted Stock Common Stock Balance at December 31, 2020 - Assumed in merger 107,993 Balance at September 30, 2021 107,993 As of September 30, 2021, there were no unamortized or unvested stock-based compensation costs related to restricted share arrangements. Preferred Stock The Company’s authorized preferred stock consists of 50,000,000 0.0001 In connection with our acquisition of Panacea on June 30, 2021, we issued convertible preferred stock to our new principal shareholder and Chief Executive Officer (and her affiliates) as follows: 1,000,000 10,000 10,000 17.8 6.046 2.289 281.25 106.49 430 162.813 Effective October 25, 2021, we filed a Certificate of Designation for 100 2,050,000 100 The Series C-2’s only rights are to convert into 2,050,000 shares of common stock on or after November 1, 2022 and to vote on an as-converted basis. The effect of this exchange was to increase the percentage of public float compared to outstanding common stock. In addition, the Company entered into an exchange agreement on June 30, 2021 with an investor and filed with the Secretary of State of the State of Nevada a Certificate of Designation of Preferences, Rights and Limitations for Series A Preferred stock under which the Note in the original principal amount of $ 750,000 500 0 Series A Preferred 1,000 The Company authorized the issuance of a total of 1,000 0.05 100 2,000,000 The Company is prohibited from effecting the conversion of the Series A Preferred to the extent that, as a result of such conversion, the holder beneficially owns more than 4.99% (which may be increased to 9.99% upon 61 days’ written notice to the Company), in the aggregate, of the issued and outstanding shares of the common stock calculated immediately after giving effect to the issuance of shares of common stock upon the conversion of the Series A Preferred. The Series A Preferred can be redeemed at the Company’s option upon payment of a redemption premium between 120% to 135% of the Stated Value of the outstanding Series A Preferred redeemed. On February 16, 2021 the Company offered to our prior Series A Preferred stock holder enhanced conversion inducements to voluntarily convert the preferred shares into our common stock and filed a Certificate of Cancellation and Withdrawal with the Secretary of State of the State of Nevada cancelling our prior Certificate of Designation of Preferences, Rights and Limitations for Series A Preferred stock, all of which has been converted to common stock, in order to issue the new 0% Series A Preferred stock described herein. On April 7, 2021 the Company filed a Certificate of Cancellation and Withdrawal with the Secretary of State of the State of Nevada cancelling our prior Certificate of Designation of Preferences, Rights and Limitations for the previous Series C Preferred Stock, all of which has been cancelled or converted into common stock. On February 16, 2021, the Company offered to holders of our prior Series D Preferred Stockholder(s) enhanced inducements to voluntarily convert preferred shares into our common stock. On April 7, 2021 the Company filed a Certificate of Cancellation and Withdrawal with the Secretary of State of the State of Nevada cancelling our prior Certificate of Designation of Preferences, Rights and Limitations for the previous Series D Preferred Stock, all of which has been cancelled or converted into common stock. During the quarter ended June 30, 2021 the Company withdrew its prior Series C Preferred Stock, Series D Preferred Stock and Series E Preferred Stock and issued shares of newly designated Series C, Series C-1 and Series D to former Panacea stockholders pursuant to the Exchange Agreement. PANACEA LIFE SCIENCES HOLDINGS, INC. AND SUBSIDIARY CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ (DEFICIT) EQUITY (unaudited) SCHEDULE OF PREFERRED STOCK Three Months Ended September 30, 2021 Preferred Stock Convertible - Series A Shares Preferred Stock Series B-1 Shares Preferred Stock Series B-2 Shares Preferred Stock Series C Shares Preferred Stock Series C-1 Shares Preferred Stock Series D Shares Total Preferred Stock Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Balance as of June 30, 2021 450 $ - 1,500,000 $ 150 6,000,000 $ 600 1,000,000 $ 100 10,000 $ 1 10,000 $ 1 8,520,450 $ 852 Shares issued for acquisition Shares issued for acquisition, shares Series A Preferred stock converted to common shares (100 ) - - - - - - - - - - - (100 ) - Balance as of September 30, 2021 350 $ - 1,500,000 $ 150 6,000,000 $ 600 1,000,000 $ 100 10,000 $ 1 10,000 $ 1 8,520,350 $ 852 Nine Months Ended September 30, 2021 Preferred Stock Convertible - Series A Shares Preferred Stock Series B-1 Shares Preferred Stock Series B-2 Shares Preferred Stock Series C Shares Preferred Stock Series C-1 Shares Preferred Stock Series D Shares Total Preferred Stock Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Balance as of December 31, 2020 - $ - - $ - - - 1,000,000 $ 100 10,000 $ 1 10,000 $ 1 1,020,000 $ 102 Shares issued for acquisition 450 - 1,500,000 150 6,000,000 600 - - - - - - 7,500,000 750 Series A Preferred stock converted to common shares (100 ) - - - - - - - - - - (100 ) - Balance as of September 30, 2021 350 $ - 1,500,000 $ 150 6,000,000 600 1,000,000 $ 100 10,000 $ 1 10,000 $ 1 8,520,350 $ 852 Three Months Ended September 30, 2020 Preferred Stock Convertible - Series A Shares Preferred Stock Series B-1 Shares Preferred Stock Series B-2 Shares Preferred Stock Series C Shares Preferred Stock Series C-1 Shares Preferred Stock Series D Shares Total Preferred Stock Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Balance as of June 30, 2020 - $ - - $ - - $ - 1,000,000 $ 100 10,000 $ 1 10,000 $ 1 1,020,000 $ 102 Shares issued for acquisition - - - - - - - - - - - - - - Balance as of September 30, 2020 - $ - $ - - $ - 1,000,000 $ 100 10,000 $ 1 10,000 $ 1 1,020,000 $ 102 Nine Months Ended September 30, 2020 Preferred Stock Convertible - Series A Shares Preferred Stock Series B-1 Shares Preferred Stock Series B-2 Shares Preferred Stock Series C Shares Preferred Stock Series C-1 Shares Preferred Stock Series D Shares Total Preferred Stock Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Balance as of December 31, 2020 - $ - - $ - - $ - 1,000,000 $ 100 10,000 $ 1 10,000 $ 1 1,020,000 $ 102 Shares issued for acquisition - - - - - - - - - - - - - - Balance as of September 30, 2020 - $ - $ - - $ - 1,000,000 $ 100 10,000 $ 1 10,000 $ 1 1,020,000 $ 102 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 8 - COMMITMENTS AND CONTINGENCIES Legal Matters In the ordinary course of business, the Company enters into agreements with third parties that include indemnification provisions which, in its judgment, are normal and customary for companies in the Company’s industry sector. These agreements are typically with business partners, and suppliers. Pursuant to these agreements, the Company generally agrees to indemnify, hold harmless, and reimburse indemnified parties for losses suffered or incurred by the indemnified parties with respect to the Company’s products, use of such products, or other actions taken or omitted by us. The maximum potential number of future payments the Company could be required to make under these indemnification provisions is unlimited. The Company has not incurred material costs to defend lawsuits or settle claims related to these indemnification provisions. As a result, the estimated fair value of liabilities relating to these provisions is minimal. Accordingly, the Company has no liabilities recorded for these provisions as of September 30, 2021. As a result of our acquisition of Panacea, the Company is now involved in the following pending litigation: On February 16, 2021, Henley Group, Inc. filed with the Superior Court of the State of California, San Bernardino County, a complaint (Case #: SIV SB 2105771) against Panacea for breach of contract and fraud related to Panacea’s non-delivery of product. While Panacea refunded the purchase price, the plaintiff seeks damages including lost profits and costs which plaintiff alleged to have incurred in the amount of approximately $ 45,000 On October 7, 2019, CMI Mechanical (“CMI”) agreed to procure, deliver, and install a dehumidification system (the “System”) at the Company’s facility located at 16194 W. 45th Drive, Golden, Colorado 80403 (the “Property”). The Company believes the System has failed to meet the requirements of the subject contract, and CMI has not remedied that failure for the Company. The Company withheld certain payments as permitted under the contract. On December 10, 2020, CMI recorded a lien against the Property in the amount of $108,001.48. On January 27, 2021, the Panacea’s attorney notified CMI that its lien was invalid, overstated, and violated the terms of the contract. The letter also demanded that CMI remove the system at CMI’s own cost. The lien was since dropped. CMI and Panacea plan to pursue complaints regarding this issue and possible mediation in 2022. Concentrations The Company has no concentration of vendors that would impact production costs in the longer term. On the revenue side, in the 3 rd 29 rd The Company has no contingencies, material commitments, or purchase obligations or sales obligations. The other concentration is in the accounts receivable category, where three customer accounts for 61 36 61 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Sep. 30, 2021 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 9 - RELATED PARTY TRANSACTIONS Notes Payable and Accrued Interest – Related Parties On June 30, 2021 Panacea received a loan of from Quintel-MC Incorporated, an affiliate of the Company’s CEO in exchange for the Quintel Note. (see Note 5 – Notes Payable - Quintel Note). The principal of this loan is $ 4,062,713 On June 30, 2021, Panacea issued the Company’s CEO, Ms. Buttorff, a 10 1,624,000 On July 1, 2021, the Company issued Ms. Buttorff a $ 1 392,201 During October 2019, the Company issued a short-term promissory notes to an officer of Exactus, for an aggregate principal amount of $ 55,556 J&N Real Estate related party owned by Ms. Buttorff—See Note 5 Operating lease. The Services Agreement dated January 1, 2019, by and between the Company and Quintel, with respect to IT, HR, accounting/periodic reporting, production planning, and employee reporting services. The Master Agreement dated January 1, 2019, by and between the Company and Quintel/Canna Software, LLC for the provision of the ERPCannabis solution. As of September 30, 2021 the outstanding obligation under these two service contracts is $ 2,529,248 229,497 91,482 The accrued interest and interest expenses recorded for related party loans are shown below. SCHEDULE OF RELATED PARTY TRANSACTIONS LOANS September 30, 2021 December 31, 2020 Accrued Interest Related party loan-Quintel $ 123,104 $ 1,347,356 Related party loan-CEO loan 42,494 1,500 Related party loan-XXII - - Related party loan – Line of credit 9,129 - Accrued Interest Related party loan Three months ended Nine months ended Three months ended Nine months ended Interest Expense Related party loan-Quintel $ 123,104 $ 645,628 $ 257,234 $ 643,171 Related party loan-CEO loan 42,494 102,679 - - Related party loan-XXII - - 175,000 525,000 Related party loan – Line of Credit 9,129 9,129 - - Interest Expense Related party loan Other The Company continues to hold 1,227,017 70,000 230,296 |
RESTATED FINANCIAL STATEMENTS A
RESTATED FINANCIAL STATEMENTS AND EXPLANATIONS | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
RESTATED FINANCIAL STATEMENTS AND EXPLANATIONS | NOTE 10 – RESTATED FINANCIAL STATEMENTS AND EXPLANATIONS This Amendment No.1 on Form 10-Q/A (the “Amendment”) amends the Quarterly Report on Form 10-Q (the “Q3 2021 Form 10-Q”) of Panacea Life Sciences Holdings, Inc. (F/K/A Exactus, Inc.) (the “Company”) for the quarter ended September 30, 2021, as filed with the Securities and Exchange Commission (the “SEC”) on November 15, 2021. We are filing this Amendment to change certain disclosures in Part I. Item 1 – Financial Statements, and Part II. Item 7 – Management’s Discussion and Analysis of Financial Condition and Results of Operations – of the Q3 2021 Form 10-Q following the completion of review by the Company’s independent registered public accounting firm. The Q3 202Away1 Form 10-Q was previously filed before the review was completed. The following tables’ present reconciliation from our prior periods as previously reported to the restated values for the consolidated balance sheets and the consolidated statement of operations. A description of restatements is listed below: Impacts of restatement The effects of the restatement on the line items within the Company’s condensed consolidated balance sheets as of September 30, 2021 are as follows: SCHEDULE OF EFFECTS OF RESTATEMENT (a) Amortization of right of use asset was recorded twice in initial filing. (b) Reflects reversal of depreciation that was previously posted on asset that was retired. (c) To separately report short and long-term amounts associated with right of use asset. Panacea Life Sciences Holdings, Inc. and Subsidiary Unaudited Condensed Consolidated Balance Sheets September 30, 2021 December 31, 2020 September 30, 2021 December 31, 2020 September 30, 2021 December 31, 2020 As Restated Adjustment As Reported September 30, 2021 December 31, 2020 September 30, 2021 December 31, 2020 September 30, 2021 December 31, 2020 (Unaudited) (Unaudited) (Unaudited) ASSETS CURRENT ASSETS: Cash and cash equivalents $ 14,500 $ 84,379 $ - $ - $ 14,500 $ 84,379 Accounts receivable, net 515,095 147,302 - - 515,095 147,302 Other receivables, related party 500,000 - - - 500,000 - Inventory, net 4,344,378 8,409,734 - - 4,344,378 8,409,734 Marketable securities related party 3,631,970 2,853,437 - - 3,631,970 2,853,437 Prepaid expenses and other current assets 193,596 27,375 - - 193,596 27,375 TOTAL CURRENT ASSETS 9,199,539 11,522,227 - - 9,199,539 11,522,227 Operating lease right-of-use asset, net, related party 3,681,682 3,937,706 (a) 57,237 - 3,624,445 3,937,706 Property and equipment, net 9,024,505 13,590,286 (b) - 14,600 9,024,505 13,575,687 Intangible assets, net 76,751 122,801 - - 76,751 122,800 Goodwill 2,188,810 2,188,810 - - 2,188,810 2,188,810 TOTAL ASSETS $ 24,171,287 $ 31,361,830 $ 57,237 $ 14,600 $ 24,114,050 $ 31,347,230 LIABILITIES AND STOCKHOLDERS’ EQUITY CURRENT LIABILITIES: Accounts payable and accrued expenses $ 1,474,681 $ 1,765,267 $ - $ - $ 1,474,681 $ 1,765,267 Operating lease liability, current portion, related party 1,508,743 1,162,869 (c) (3,453,787 ) (3,692,381 ) 4,962,530 4,855,250 Note payable-current, related party 6,216,155 15,061,044 - - 6,216,155 15,061,044 Paycheck protection loan, SBA Loan 99,100 273,300 - - 99,100 273,300 TOTAL CURRENT LIABILITIES: 9,298,679 18,262,480 (3,453,787 ) (3,692,381 ) 12,752,466 21,954,861 Operating lease liability, long-term portion, related party 3,434,571 3,692,392 (c) 3,434,571 3,692,392 - - Other long-term liabilities, related party 3,042,638 2,698,659 (c) - - 3,042,638 2,698,659 TOTAL LIABILITIES 15,775,888 24,653,531 (19,216 ) 11 15,795,104 24,653,520 Commitments and contingencies - - - - - - STOCKHOLDERS’ EQUITY - Series A Preferred Stock: $ 0.0001 1,000 450 0 - - - - - - Series B-1 Preferred: $ 0.0001 32,000,000 1,500,000 0 150 - - - 150 - Series B-2 Preferred: $ 0.0001 6,000,000 6,000,000 0 600 - - - 600 - Series C Preferred: $ 0.0001 1,000,000 1,000,000 1,000,000 100 100 - - 100 100 Series C-1 Preferred: $ 0.0001 10,000 10,000 10,000 1 1 - - 1 1 Series D Preferred: $ 0.0001 10,000 10,000 10,000 1 1 - - 1 1 Preferred stock value Common Stock: $ 0.0001 650,000,000 21,393,041 16,915,706 2,139 1,692 - - 2,139 1,692 Additional paid in capital 23,066,914 18,689,119 (b) (14,588 ) (0 ) 23,081,502 18,689,119 Accumulated deficit (14,674,506 ) (11,982,614 ) (b) 91,041 14,589 (14,765,547 ) (11,997,203 ) TOTAL STOCKHOLDERS’ EQUITY 8,395,399 6,708,299 76,453 14,589 8,318,946 6,693,710 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 24,171,287 $ 31,361,830 $ 57,237 $ 14,600 $ 24,114,050 $ 31,347,230 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. The effects of the restatement on the line items within the Company’s condensed consolidated statements of operations and comprehensive income for the six months ended September 30, 2021 are as follows: (a) Amortization of right of use asset was recorded twice in initial filing. Panacea Life Sciences Holdings, Inc. and Subsidiary Unaudited Condensed Consolidated Statements of Operations 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 As Restated Adjustment As Reported Three Months Ended September 30, Nine Months Ended September 30, Three Months Ended September 30, Nine Months Ended September 30, Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 REVENUE $ 588,040 $ 1,343,641 $ 1,413,674 $ 8,305,630 $ $ $ - $ - $ 588,040 $ 1,343,641 $ 1,413,674 $ 8,305,630 COST OF SALES 305,025 2,905,780 883,508 6,285,879 - - - - 305,025 2,905,780 883,508 6,285,879 GROSS PROFIT (LOSS) 283,015 (1,562,139 ) 530,166 2,019,751 - - - - 283,015 (1,562,139 ) 530,166 2,019,751 OPERATING EXPENSES Production related operating expenses 1,250,434 1,307,169 3,407,407 3,012,485 (a) (76,462 ) 5 (76,452 ) 10 1,326,896 1,307,164 3,483,859 3,012,475 General and administrative expenses 290,638 478,992 911,906 2,547,438 - (4,205 ) - (4,205 ) 290,638 483,197 911,906 2,551,643 TOTAL OPERATING EXPENSES 1,541,072 1,786,161 4,319,313 5,559,923 (76,462 ) (4,200 ) (76,452 ) (4,195 ) 1,617,534 1,790,361 4,395,765 5,564,118 INCOME (LOSS) FROM OPERATIONS (1,258,057 ) (3,348,300 ) (3,789,147 ) (3,540,172 ) (a) 76,462 4,200 76,452 4,195 (1,334,519 ) (3,352,500 ) (3,865,599 ) (3,544,367 ) OTHER INCOME (EXPENSES) Interest expense (174,727 ) (432,922 ) (781,671 ) (1,181,165 ) - - - - (174,727 ) (432,922 ) (781,671 ) (1,181,165 ) Unrealized gain (loss) on marketable securities, net (2,303,218 ) (160,310 ) 848,533 (595,590 ) - (60,818 ) - 16,891 (2,303,218 ) (99,492 ) 848,533 (612,481 ) Realized gain on sale of securities 160,296 - 160,296 - - - - - 160,296 - 160,296 - Other income (loss) - 56,619 - (21,090 ) - 56,619 - (21,090 ) Employer retention credit 190,338 - 190,338 - - - - - 190,338 - 190,338 - Rental Income 58,410 56,577 221,328 212,778 - - - - 58,410 56,577 221,328 212,778 Gain (loss) on sale of assets - 48,621 (297,351 ) (19,093 ) - - - - - 48,621 (297,351 ) (19,093 ) Gain on extinguishment of debt 237,202 - 755,782 - - - - - 237,202 - 755,782 - TOTAL OTHER INCOME (EXPENSE) (1,831,699 ) (431,415 ) 1,097,255 (1,604,160 ) - (4,199 ) - (4,199 ) (1,831,699 ) (427,216 ) 1,097,255 (1,599,961 ) INCOME (LOSS) BEFORE INCOME TAXES (3,089,756 ) (3,779,715 ) (2,691,892 ) (5,144,332 ) (a) 76,462 1 76,452 (4 ) (3,166,218 ) (3,779,716 ) (2,768,344 ) (5,144,328 ) TAXES - - - - - - - - - - - - NET INCOME (LOSS) $ (3,089,756 ) $ (3,779,715 ) $ (2,691,892 ) $ (5,144,332 ) (a) $ 76,462 $ 1 $ 76,452 $ (4 ) $ (3,166,218 ) $ (3,779,716 ) $ (2,768,344 ) $ (5,144,328 ) BASIC NET INCOME (LOSS) PER SHARE $ (0.14 ) $ (0.22 ) $ (0.15 ) $ (0.30 ) $ 0.00 $ 0.00 $ (0.02 ) $ (0.00 ) $ (0.15 ) $ (0.22 ) $ (0.13 ) $ (0.30 ) DILUTED NET INCOME (LOSS) PER SHARE $ (0.14 ) $ (0.22 ) $ (0.15 ) $ (0.30 ) $ 0.00 $ 0.00 $ (0.02 ) $ (0.00 ) $ (0.15 ) $ (0.22 ) $ (0.13 ) $ (0.30 ) WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING Basic 21,389,041 16,915,706 18,422,459 16,915,706 - - (2,966,582 ) - 21,389,041 16,915,706 21,389,041 16,915,706 Diluted 21,389,041 16,915,706 18,422,459 16,915,706 - - (2,966,582 ) - 21,389,041 16,915,706 21,389,041 16,915,706 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. The effects of the restatement on the line items within the Company’s condensed statement of stockholders’ equity as of September 30, 2021 are as follows: (a) The changes in the “Accumulated Deficit” reflects the accumulated difference of the changes reported in the Statement of Operations. (b) The change in “Additional Paid-in Capital” reflects reclass and adjustments associated with the Company 1 to 28 reverse split of its Common Stock. (c) The changes in “Net Income” reflects the accumulated difference of the changes reported in the Statement of Operations for the period. Panacea Life Sciences Holdings, Inc. and Subsidiary UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY Preferred Stock Common Stock Additional Paid-in Accumulated Total Stockholder’s Additional Paid-in Accumulated Total Stockholder’s Preferred Stock Common Stock Additional Paid-in Accumulated Total Stockholder’s As restated Adjustment Three Months Ended September 30, 2021 Three Months Ended September 30, 2021 Preferred Stock Common Stock Additional Paid-in Accumulated Total Stockholder’s Additional Paid-in Accumulated Total Stockholder’s Preferred Stock Common Stock Additional Paid-in Accumulated Total Stockholder’s Shares Amount Shares Amount Capital Deficit Equity Capital Deficit Equity Shares Amount Shares Amount Capital Deficit Equity Balance as of June 30, 2021 8,520,450 $ 852 21,321,613 $ 2,132 $ 23,066,921 $ (11,584,750 ) $ 11,485,155 (a) (b) $ (4,455 ) $ 4,446 $ (9 ) 8,520,450 $ 852 21,321,613 $ 2,132 $ 23,071,376 $ (11,589,196 ) $ 11,485,164 Shares issued for acquisition Shares issued for acquisition, shares Series A Preferred stock conversion to common stock (100 ) - 71,429 7 (7 ) - (b) - - - (100 ) - 71,429 7 (7 ) - Net Loss - - - - - (3,089,756 ) (3,089,756 ) (c) - 76,462 76,462 - - - - - (3,166,218 ) (3,166,218 ) Balance as of September 30, 2021 8,520,350 $ 852 21,393,042 $ 2,139 $ 23,066,914 $ (14,674,506 ) $ 8,395,399 $ (4,455 ) $ 80,908 $ 76,453 8,520,350 $ 852 21,393,042 $ 2,139 $ 23,071,369 $ (14,755,414 ) $ 8,318,946 Nine Months Ended September 30, 2021 Nine Months Ended September 30, 2021 Preferred Stock Common Stock Additional Paid-in Accumulated Total Stockholder’s Preferred Stock Common Stock Additional Paid-in Accumulated Total Stockholder’s Shares Amount Shares Amount Capital Deficit Equity Shares Amount Shares Amount Capital Deficit Equity Balance as of December 31, 2020 1,020,000 $ 102 16,915,706 $ 1,692 $ 18,689,119 $ (11,982,614 ) $ 6,708,299 (a) (b) $ 10,133 $ 4,456 $ 14,589 1,020,000 $ 102 16,915,706 $ 1,692 $ 18,678,986 $ (11,987,070 ) $ 6,693,710 Shares issued for acquisition 7,500,450 750 4,405,907 440 4,377,802 4,378,992 (b) (14,588 ) - (14,588 ) 7,500,450 750 4,405,907 440 4,392,390 4,393,580 Series A Preferred stock conversion to common stock (100 ) - 71,429 7 (7 ) - - - - (100 ) - 71,429 7 (7 ) - Net Loss - - - - - (2,691,892 ) (2,691,892 ) (c) - 76,452 76,452 - - - - - (2,768,344 ) (2,768,344 ) Balance as of September 30, 2021 8,520,350 $ 852 21,393,042 $ 2,139 $ 23,066,914 $ (14,674,506 ) $ 8,395,399 $ (4,455 ) $ 80,908 $ 76,453 8,520,350 $ 852 21,393,042 $ 2,139 $ 23,071,369 $ (14,755,414 ) $ 8,318,946 Three Months Ended September 30, 2020 Three Months Ended September 30, 2020 Preferred Stock Common Stock Additional Paid-in Accumulated Total Stockholder’s Preferred Stock Common Stock Additional Paid-in Accumulated Total Stockholder’s Shares Amount Shares Amount Capital Deficit Equity Shares Amount Shares Amount Capital Deficit Equity Balance as of June 30, 2020 1,020,000 $ 102 16,915,706 $ 1,692 $ 18,689,119 $ (8,115,401 ) $ 10,575,512 (a) (b) $ 236,847 $ (10,142 ) $ 226,705 1,020,000 $ 102 16,915,706 $ 1,692 $ 18,452,272 $ (8,105,259 ) $ 10,348,807 Net Loss - - - - - (3,779,715 ) (3,779,715 ) - - - - - - - - (3,779,715 ) (3,779,715 ) Balance as of September 30, 2020 1,020,000 $ 102 16,915,706 $ 1,692 $ 18,689,119 $ (11,895,116 ) $ 6,795,797 $ 236,847 $ (10,142 ) $ 226,705 1,020,000 $ 102 16,915,706 $ 1,692 $ 18,452,272 $ (11,884,974 ) $ 6,569,092 Nine Months Ended September 30, 2020 Nine Months Ended September 30, 2020 Preferred Stock Common Stock Additional Paid-in Accumulated Total Stockholder’s Preferred Stock Common Stock Additional Paid-in Accumulated Total Stockholder’s Shares Amount Shares Amount Capital Deficit Equity Shares Amount Shares Amount Capital Deficit Equity Balance as of December 31, 2019 1,020,000 $ 102 16,915,706 $ 1,692 $ 18,689,119 $ (6,750,784 ) $ 11,940,129 (a) (b) $ 236,847 $ (10,137 ) $ 226,710 1,020,000 $ 102 16,915,706 $ 1,692 $ 18,452,272 $ (6,740,647 ) $ 11,713,419 Net Loss - - - - - (5,144,332 ) (5,144,332 ) (c) - (5 ) (5 ) - - - - - (5,144,327 ) (5,144,327 ) Balance as of September 30, 2020 1,020,000 $ 102 16,915,706 $ 1,692 $ 18,689,119 $ (11,895,116 ) $ 6,795,797 $ 236,847 $ (10,142 ) $ 226,705 1,020,000 $ 102 16,915,706 $ 1,692 $ 18,452,272 $ (11,884,974 ) $ 6,569,092 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements The effects of the restatement on the line items within the Company’s condensed consolidated statement of cash flow as of September 30, 2021 are as follows: (a) Reflects previously unrecorded expenses. (b) Amortization of right of use asset being reported as a net amount with liability reduction. (c) Reflects liabilities acquired in merger being reported as non-cash items. (d) Reflects PPE sale to related party being reclassified as non-cash item. (e) Reflects retirement of accrued interest as being reclassified to non-cash item. (f) To separately report asset proceeds and disposals that were originally presented as a net amount. (g) Reflects amount related to note payable that was previously reported as account payable. (h) To separately report non-cash receivable due. (i) To separately report asset retirement and notes payable retirement due to merger (j) To reclassify non-cash items from merger to non-cash investing and financing activities (k) To separately report proceeds and payments on notes payable that were originally presented as a net amount. (l) To report changes in depreciation as a result of asset retirement. (m) To report interest payments made that were previously not separately disclosed. (n) To reclassify non-cash stock issuances to non-cash transactions section. (o) To correct a footing error. Panacea Life Sciences Holdings, Inc. and Subsidiary Unaudited Condensed Consolidated Statements of Cash Flows 2021 2020 2021 2020 2021 2020 As Restated Adjustment As Reported Nine Months Ended September 30, Nine Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 2021 2020 Cash flows from operating activities Net income (loss) $ (2,691,892 ) $ (5,144,332 ) (a) $ 76,452 $ (5 ) $ (2,768,344 ) $ (5,144,327 ) Adjustments to reconcile net income (loss) to net cash used in operating activities Depreciation 1,280,324 1,018,567 (l) - (626,635 ) 1,280,324 1,645,202 Realized gain on sale of securities (160,296 ) - (160,296 ) - Fixed asset disposal loss 297,351 19,093 - - 297,351 19,093 Amortization of right of use asset - - (b) (313,261 ) (249,037 ) 313,261 249,037 Amortization of intangible assets 46,050 46,050 (o) 1 - 46,049 46,050 Non cash settlement of convertible note and accrued interest (752,751 ) - (c) (99,100 ) - (653,651 ) - Unrealized gain/loss on marketable securities (848,533 ) 595,590 - - (848,533 ) 595,590 Changes in operating assets and liabilities Accounts receivable (367,793 ) 91,952 - - (367,793 ) 91,952 Inventory (628,011 ) (5,463,820 ) (d) (2,132,450 ) - 1,504,439 (5,463,820 ) Prepaid expense and other assets (166,221 ) 647,257 - - (166,221 ) 647,257 Accounts payable and accrued expenses 955,493 1,226,146 (e)(g) 1,931,562 - (976,069 ) 1,226,146 Operating lease liability, net 344,076 344,085 (b) 236,796 249,043 107,280 95,042 Net cash used in operating activities (2,692,203 ) (6,619,412 ) (300,000 ) (626,634 ) (2,392,203 ) (5,992,778 ) Cash flows from investing activities Net cash received in from acquisitions 9,157 - - - 9,157 - Proceeds from sale of marketable securities 230,296 - - - 230,296 - Proceeds from sale of fixed assets 446,026 34,920 (f) 446,026 34,920 Net fixed asset acquisition (172,397 ) (3,301,527 ) (f) (446,026 ) 474,594 273,629 (3,776,121 ) Net Cash provided by (used in) investing activities 513,082 (3,266,607 ) 1 509,514 513,082 (3,776,121 ) Cash flows from financing activities - - Proceeds from payroll protection loan, SBA loan - 273,300 - - - 273,300 Proceeds from payroll protection loan - related party 243,041 - - - 243,041 - Payments of principal on notes payable - related party (135,000 ) (3,503,545 ) (k) - (3,503,545 ) (135,000 ) - Proceeds from notes payable - related party 2,001,201 5,134,225 (g) 300,000 3,620,665 1,701,201 1,513,560 Net cash provided by financing activities 2,109,242 1,903,980 300,000 117,120 1,809,242 1,786,860 Net increase (decrease) in Cash and Cash Equivalents (69,879 ) (7,982,039 ) (o) 0 1 (69,879 ) (7,982,040 ) Cash and Cash Equivalents, Beginning of Period 84,379 8,515,509 - - 84,379 8,515,509 Cash and Cash Equivalents, End of Period $ 14,500 $ 533,470 $ 0 $ 1 $ 14,500 $ 533,469 Supplemental Disclosure of Cash Flow Information Cash paid for income taxes during the year $ - $ - $ - $ - $ - $ - Interest payments during the year $ - $ 525,000 (m) $ - $ 525,000 $ - $ - - Noncash investing and financing activity Non-Cash Receivable - related party $ (500,000 ) $ - (h) $ (3,543,858 ) $ - $ 3,043,858 $ - Related party loan repayment with inventory $ 4,693,367 $ - (i) $ 12,543,540 $ - $ (7,850,173 ) $ - Noncash fixed asset disposal as part of the reverse acquisition $ 3,058,457 $ - (i) $ 1,709,357 $ - $ 1,349,100 $ - Capitalized assets purchased on account - related party $ 343,979 $ 396,270 (d) $ (341,504 ) $ 396,270 $ 685,483 $ - Liabilities from acquisition $ 1,096,782 $ - (c) $ 860,372 $ - $ 236,410 $ - Debt retired in merger, related party $ (12,718,441 ) $ - (j) $ (17,089,778 ) $ - $ 4,371,337 $ - Preferred Series B-1 Issuance in Acquisition $ 150 $ - $ - $ - $ 150 $ - Preferred Series B-2 Issuance in Acquisition $ 600 $ - $ - $ - $ 600 $ - Common stock issued for the reverse merger with Exactus $ 4,369,085 $ - (n) $ 4,356,748 $ - $ 12,337 $ - The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2021 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 11– SUBSEQUENT EVENTS Effective October 25, 2021 the Company completed the 1-for-28 reverse stock split On October 25, 2021, of the 10,649,078 7,321,429 100 7,321,429 Other than the conversion and voting rights, there are no other preferences for the Parent C-2 Stock. On November 18, 2021, the Company and an institutional investor signed an agreement for a $ 1.1 1 1.40 785,715 1.40 10 900,000 |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Basis of presentation and principles of consolidation | Basis of presentation and principles of consolidation The Company’s unaudited condensed consolidated financial statements include the financial statements of Panacea Life Sciences, Inc., a wholly owned subsidiary acquired on June 30, 2021. The accompanying interim unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America and the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) for interim financial information, which includes consolidated unaudited interim financial statements and present the consolidated unaudited interim financial statements of the Company and its wholly-owned subsidiary as of September 30, 2021. Accordingly, they do not include all of the information and notes required by accounting principles generally accepted in the United States of America. All intercompany transactions and balances have been eliminated. In the opinion of management, all adjustments necessary to present fairly our financial position, results of operations, stockholders’ equity and cash flows as of September 30, 2021, and 2020, and for the periods then ended, have been made. Those adjustments consist of normal and recurring adjustments. Operating results for the three and nine months ended September 30, 2021 and 2020 are not necessarily indicative of the results that may be expected for any subsequent quarters or for the year ending December 31, 2021. Certain information and note disclosures normally included in our annual financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. |
Going concern | Going concern These unaudited condensed consolidated financial statements are presented on the basis that the Company will continue as a going concern. Panacea has combined with Panacea Life Sciences Holdings, Inc. (formerly Exactus), so the below items reflect the consolidated company. The going concern concept contemplates the realization of assets and satisfaction of liabilities in the normal course of business. Since our inception in later 2017, we have generated losses from operations. As of September 30, 2021, our accumulated deficit was $ 14.675 3.646 nd 1,227,017 3.631 4.063 1.624 1.1 |
COVID-19 | COVID-19 The COVID-19 pandemic has resulted in a global slowdown of economic activity which is likely to continue to reduce the future demand for a broad variety of goods and services, while also disrupting sales channels, marketing activities and supply chains for an unknown period of time until the virus is fully contained. The Company’s business operations have been negatively impacted by the COVID-19 pandemic and related events and the Company expects this impact on its revenue and results of operations, the size and duration of which is currently difficult to predict. However, adverse consequences from COVID-19 and recent supply chain disruptions and delays may hinder our ability to continue our operations and generate revenue. The impact to date has included a decline in CBD product and sales demand. Further, in 2020, the Company (Panacea) invested in personal protective equipment (PPE) materials to sell hand sanitizers, testing kits and masks, and sales of PPE products, which constituted a significant portion of our revenue during the fiscal quarter ended June 30, 2021 and prior periods during the pandemic, have declined as vaccines continue to be administered and mask mandates and similar requirements have been lifted or reduced in many places. Although the Company is unable to predict the full impact and duration of COVID-19 on its business, the Company is actively managing its financial expenditures in response to the current uncertainty. The impact of the COVID-19 pandemic and related events, including actions taken by various government authorities in response, have increased market volatility and make the estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes more difficult. As of the date of issuance of the financial statements, the Company is not aware of any specific event or circumstance that would require it to update its estimates, judgments or revise the carrying value of its assets or liabilities. These estimates may change, as new events occur and additional information is obtained, and are recognized in the condensed consolidated financial statements as soon as they become known. |
Marketable securities | Marketable securities The Company’s marketable securities consists of 1,227,017 Going Concern |
Use of Estimates | Use of Estimates The Unaudited Condensed Consolidated Financial Statements have been prepared in conformity with US GAAP and required management of the Company to make estimates and assumptions in preparation of these statements. Actual results may differ significantly from those estimates. Significant estimates made by management include but are not limited to the useful life of property and equipment, incremental borrowing rate used in the calculation of right of use asset and lease liability, reserves for inventory, allowance for doubtful accounts, revenue allocations, valuation allowance on deferred tax assets, assumptions used in assessing impairment of long-term assets, assumptions used in the calculation of net realizable value of inventory and fair value of non-cash equity transactions. |
Fair Value Measurements | Fair Value Measurements The Company adopted the provisions of Accounting Standard Codification (“ASC”) Topic 820, “Fair Value Measurements and Disclosures”, which defines fair value as used in numerous accounting pronouncements, establishes a framework for measuring fair value, and expands disclosure of fair value measurements. The guidance prioritizes the inputs used in measuring fair value and establishes a three-tier value hierarchy that distinguishes among the following: ● Level 1—Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. ● Level 2—Valuations based on quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active and models for which all significant inputs are observable, either directly or indirectly. ● Level 3—Valuations based on inputs that are unobservable and significant to the overall fair value measurement. The following table shows, by level within the fair value hierarchy, the Company’s assets and liabilities at fair value on a recurring basis as of September 30, 2021 and December 31, 2020: FAIR VALUE, ASSETS MEASURED ON RECURRING BASIS September 30, 2021 December 31, 2020 Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Marketable securities $ 3,631,970 $ 3,631,970 $ - - $ 2,853,437 $ 2,853,437 $ - $ - Total $ 3,631,970 $ 3,631,970 $ - $ - $ 2,853,437 $ 2,853,437 $ - $ - In August, 2021 there was one sale of marketable securities out of Level 1. There were no transfers in 2020. On August 5, 2021 70,000 3.29 230,296 160,296 SCHEDULE OF MARKETABLE SECURITIES September 30, 2021 Balance at beginning of year $ 2,853,437 Sale of securities (230,296 ) Realized gain on sale of securities 160,296 Unrealized gain on marketable securities, net 848,533 Balance at end of period $ 3,631,970 As of September 30, 2021, the Company has no liabilities that are re-measured at fair value. |
Income Taxes | Income Taxes Income taxes are accounted for under the asset and liability method prescribed by FASB ASC Topic 740. These standards require a company to determine whether it is more likely than not that a tax position will be sustained upon examination based upon the technical merits of the position. If the more likely than not threshold is met, a company must measure the tax position to determine the amount to recognize in the financial statements. Deferred income taxes are recorded for temporary differences between financial statement carrying amounts and the tax basis of assets and liabilities. Deferred tax assets and liabilities reflect the tax rates expected to be in effect for the years in which the differences are expected to reverse. A valuation allowance is provided if it is more likely than not that some or all of the deferred tax asset will not be realized. |
Revenue Recognition | Revenue Recognition The Company accounts for revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers The Company accounts for a contract when it has been approved and committed to, each party’s rights regarding the goods or services to be transferred have been identified, the payment terms have been identified, the contract has commercial substance, and collectability is probable. Revenue is generally recognized net of allowances for returns and any taxes collected from customers and subsequently remitted to governmental authorities. However, the Company’s sales are primarily through retail stores, purchase orders or ecommerce; thus, currently contract liabilities are negligible. The Company does not have any multiple-element arrangements. Some of the Company’s contract liabilities consist of advance customer payments. Contract liability results from transactions in which the Company has been paid for products by customers, but for which all revenue recognition criteria have not yet been met. Once all revenue recognition criteria have been met, the contract liabilities are recognized. The company recorded $ 31,725 463,454 SCHEDULE OF REVENUE FROM CONTRACT WITH CUSTOMER September 30, 2021 December 31, 2020 Balance, beginning of period $ 121,300 $ 254,786 Payments received for unearned revenue 31,725 463,454 Revenue earned 132,955 596,940 Balance, end of period $ 20,070 $ 121,300 Revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration that an entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for those goods. The Company applies the following five-step model in order to determine this amount: (i) identification of the promised goods in the contract; (ii) determination of whether the promised goods are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation. Revenue related to the sale of products is recognized once goods have been sold to the customer and the performance obligation has been completed. In both contracted purchase and retail sales, we offer consumer products through our online stores. Revenue is recognized when control of the goods is transferred to the customer. This generally occurs upon our delivery to a third-party carrier or, to the customer directly. Revenue from tolling services is recognized when the performance obligation, such as processing of the material, has been completed and output material has been transferred to the customer. Revenue is generally recognized net of allowances for returns and any taxes collected from customers and subsequently remitted to governmental authorities. Some of the Company’s contract liabilities consist of advance customer payments. A contract liability results from transactions in which the Company has been paid for products by customers, but for which all revenue recognition criteria have not yet been met. Once all revenue recognition criteria have been met, the contract liabilities are recognized. However, the Company’s sales are primarily through retail stores, purchase orders or ecommerce; thus, currently contract liabilities are negligible. The Company does not have any multiple-element arrangements. Some of the Company’s contract liabilities consist of advance customer payments. Contract liability results from transactions in which the Company has been paid for products by customers, but for which all revenue recognition criteria have not yet been met. Once all revenue recognition criteria have been met, the contract liabilities are recognized. The Company also has recorded other income related to rental income it receives from leasing out space in the laboratory it occupies. |
Accounts Receivable | Accounts Receivable Accounts receivable are generally unsecured. The Company establishes an allowance for doubtful accounts receivable based on the age of outstanding invoices and management’s evaluation of collectability. Accounts are written off after all reasonable collection efforts have been exhausted and management concludes that likelihood of collection is remote. Any future recoveries are applied against the allowance for doubtful accounts. As of September 30, 2021 and December 31, 2020, we did not believe we needed to reserve for any doubtful accounts, respectively. The Company’s accounts receivable policy changed in 2020 to only provide larger, well-established companies with Net 30 payment terms. For all other sales they are paid by credit card or wires received before the product is shipped to the customer. |
Shipping and Handling Costs | Shipping and Handling Costs The Company accounts for shipping and handling fees in accordance with ASC 606. The amounts charged to customers for shipping products are recognized as revenues and the related freight costs of shipping products are classified in general and administrative costs as incurred. Shipping costs are included as a component of general and administrative and were $ 12,603 54,429 |
Segment Information | Segment Information The Company follows the provisions of ASC 280-10 Segment Reporting. |
Cash and Cash Equivalents | Cash and Cash Equivalents For purposes of balance sheet presentation and reporting of cash flows, the Company considers all unrestricted demand deposits, money market funds and highly liquid debt instruments with an original maturity of less than 90 days to be cash and cash equivalents. There were no cash equivalents. The Company places its cash and cash equivalents with high-quality financial institutions. At times, balances in the Company’s cash accounts may exceed the Federal Deposit Insurance Corporation (“FDIC”) limit. On September 30, 2021, the Company’s cash balances did not exceed the FDIC limit. |
Advertising & Marketing | Advertising & Marketing Advertising costs are expensed when incurred and are included in advertising and promotional expense in the accompanying statements of operations. Included in this category are expenses related to public relations, investor relations, new package design, website design, design of promotional materials, cost of trade shows, cost of products given away as promotional samples, and paid advertising. The Company recorded advertising costs included in general and administrative costs of $ 292,157 1,375,962 |
Earnings per Share | Earnings per Share The Company computes basic and diluted earnings per share amounts in accordance with ASC Topic 260, “Earnings per Share”. Basic earnings per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding during the reporting period. Diluted earnings per share reflects the potential dilution that could occur if preferred stock converted to common stock and warrants are exercised. Preferred stock and warrants are excluded from the diluted earnings per share calculation if their effect is anti-dilutive. The Business Combination on June 30, 2021 was accounted for as a recapitalization of equity structure. In October, 2021 the Company completed 1-for-28 reverse stock split. The following financial instruments were not included in the diluted loss per share calculation for the three months ending September 30, 2021 and 2020 because their effect was anti-dilutive: SCHEDULE OF ANTI-DILUTIVE DILUTED LOSS PER SHARE 2021 2020 For the three months ended September 30, 2021 2020 Options to purchase common stock 61,446 - Warrants to purchase common stock 56,377 - Series A Convertible Preferred 256,211 - Series B-1 Convertible Preferred 6,679 - Series B-2 Convertible Preferred 26,786 - Series C Convertible Preferred 2,289,220 - Series C-1 Convertible Preferred 1,064,908 - Series D Convertible Preferred 1,628,126 - Total 5,389,753 - The following financial instruments were not included in the diluted loss per share calculation for the nine months ending September 30, 2021 and 2020 because their effect was anti-dilutive: 2021 2020 For the nine months ended September 30, 2021 2020 Options to purchase common stock 61,446 - Warrants to purchase common stock 56,377 - Series A Convertible Preferred 250,000 - Series B-1 Convertible Preferred 6,679 - Series B-2 Convertible Preferred 26,786 - Series C Convertible Preferred 2,289,220 - Series C-1 Convertible Preferred 1,064,908 - Series D Convertible Preferred 1,628,126 - Total 5,383,541 - |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40), Accounting for Convertible Instruments and Contract’s in an Entity’s Own Equity. The ASU simplifies accounting for convertible instruments by removing major separation models required under current GAAP. Consequently, more convertible debt instruments will be reported as a single liability instrument with no separate accounting for embedded conversion features. The ASU removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception, which will permit more equity contracts to qualify for it. The ASU simplifies the diluted net income per share calculation in certain areas. The ASU is effective for annual and interim periods beginning after December 31, 2021, and early adoption is permitted for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. The Company does not expect the adoption of ASU 2020-6 to have any material impact on its consolidated financial statements. In May 2021, the Financial Accounting Standards Board (“FASB”) issued ASU 2021-04 “Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation— Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815- 40) Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options” which clarifies and reduces diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options (for example, warrants) that remain equity classified after modification or exchange. An entity should measure the effect of a modification or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange as follows: i) for a modification or an exchange that is a part of or directly related to a modification or an exchange of an existing debt instrument or line-of-credit or revolving-debt arrangements (hereinafter, referred to as a “debt” or “debt instrument”), as the difference between the fair value of the modified or exchanged written call option and the fair value of that written call option immediately before it is modified or exchanged; ii) for all other modifications or exchanges, as the excess, if any, of the fair value of the modified or exchanged written call option over the fair value of that written call option immediately before it is modified or exchanged. The amendments in this Update are effective for all entities for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. An entity should apply the amendments prospectively to modifications or exchanges occurring on or after the effective date of the amendments. The Company is currently evaluating the impact of this standard on its consolidated financial statements. The Company does not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to its financial condition, results of operations, cash flows or disclosures. |
Intangible Assets and Goodwill | Intangible Assets and Goodwill The Company has intangible assets. Goodwill is comprised of the purchase price of business combinations in excess of the fair market value assigned at acquisition to the tangible and intangible assets acquired. Goodwill is not amortized. The Company tests goodwill for impairment on an annual basis. The Company performed its most recent goodwill impairment using a discounted cash flow analysis and found that the fair value exceeded the carrying value. It has $ 2.189 0.077 0.123 SCHEDULE OF INTANGIBLE ASSETS AND GOODWILL Estimated Life Goodwill from Phoenix Acquisition Tested Yearly for Impairment Intangibles – Formulations 5 September 30, 2021 December 31, 2020 Goodwill $ 2,188,810 $ 2,188,810 Intangibles – Formulations 307,001 307,001 Less accumulated amortization (230,250 ) (184,200 ) Net intangible assets $ 76,751 $ 122,801 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
FAIR VALUE, ASSETS MEASURED ON RECURRING BASIS | The following table shows, by level within the fair value hierarchy, the Company’s assets and liabilities at fair value on a recurring basis as of September 30, 2021 and December 31, 2020: FAIR VALUE, ASSETS MEASURED ON RECURRING BASIS September 30, 2021 December 31, 2020 Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Marketable securities $ 3,631,970 $ 3,631,970 $ - - $ 2,853,437 $ 2,853,437 $ - $ - Total $ 3,631,970 $ 3,631,970 $ - $ - $ 2,853,437 $ 2,853,437 $ - $ - |
SCHEDULE OF MARKETABLE SECURITIES | SCHEDULE OF MARKETABLE SECURITIES September 30, 2021 Balance at beginning of year $ 2,853,437 Sale of securities (230,296 ) Realized gain on sale of securities 160,296 Unrealized gain on marketable securities, net 848,533 Balance at end of period $ 3,631,970 |
SCHEDULE OF REVENUE FROM CONTRACT WITH CUSTOMER | SCHEDULE OF REVENUE FROM CONTRACT WITH CUSTOMER September 30, 2021 December 31, 2020 Balance, beginning of period $ 121,300 $ 254,786 Payments received for unearned revenue 31,725 463,454 Revenue earned 132,955 596,940 Balance, end of period $ 20,070 $ 121,300 |
SCHEDULE OF ANTI-DILUTIVE DILUTED LOSS PER SHARE | The following financial instruments were not included in the diluted loss per share calculation for the three months ending September 30, 2021 and 2020 because their effect was anti-dilutive: SCHEDULE OF ANTI-DILUTIVE DILUTED LOSS PER SHARE 2021 2020 For the three months ended September 30, 2021 2020 Options to purchase common stock 61,446 - Warrants to purchase common stock 56,377 - Series A Convertible Preferred 256,211 - Series B-1 Convertible Preferred 6,679 - Series B-2 Convertible Preferred 26,786 - Series C Convertible Preferred 2,289,220 - Series C-1 Convertible Preferred 1,064,908 - Series D Convertible Preferred 1,628,126 - Total 5,389,753 - The following financial instruments were not included in the diluted loss per share calculation for the nine months ending September 30, 2021 and 2020 because their effect was anti-dilutive: 2021 2020 For the nine months ended September 30, 2021 2020 Options to purchase common stock 61,446 - Warrants to purchase common stock 56,377 - Series A Convertible Preferred 250,000 - Series B-1 Convertible Preferred 6,679 - Series B-2 Convertible Preferred 26,786 - Series C Convertible Preferred 2,289,220 - Series C-1 Convertible Preferred 1,064,908 - Series D Convertible Preferred 1,628,126 - Total 5,383,541 - |
SCHEDULE OF INTANGIBLE ASSETS AND GOODWILL | SCHEDULE OF INTANGIBLE ASSETS AND GOODWILL Estimated Life Goodwill from Phoenix Acquisition Tested Yearly for Impairment Intangibles – Formulations 5 September 30, 2021 December 31, 2020 Goodwill $ 2,188,810 $ 2,188,810 Intangibles – Formulations 307,001 307,001 Less accumulated amortization (230,250 ) (184,200 ) Net intangible assets $ 76,751 $ 122,801 |
PROPERTY, EQUIPMENT, NET OF A_2
PROPERTY, EQUIPMENT, NET OF ACCUMULATED DEPRECIATION (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
SCHEDULE OF PROPERTY PLANT AND EQUIPMENT USEFUL LIVES | SCHEDULE OF PROPERTY PLANT AND EQUIPMENT USEFUL LIVES Estimated Life Computers and technological assets 3 5 Furniture and fixtures 3 5 Machinery and equipment 5 10 Leasehold improvement 10 |
SCHEDULE OF PROPERTY AND EQUIPMENT | Property and equipment, net consists of the following: SCHEDULE OF PROPERTY AND EQUIPMENT September 30, 2021 December 31, 2020 Computers and technological assets $ 3,310,025 $ 2,993,626 Furniture and fixtures 55,951 55,951 Machinery and equipment 7,524,242 8,494,296 Land 92,222 2,293,472 Assets under construction - 743,377 Leasehold improvements 1,508,915 1,508,915 Total 12,491,355 16,089,637 Less accumulated depreciation (3,466,850 ) (2,499,351 ) Total property and equipment, net $ 9,024,505 $ 13,590,286 |
INVENTORY (Tables)
INVENTORY (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Inventory Disclosure [Abstract] | |
SCHEDULE OF INVENTORY | Inventory consists of the following components: SCHEDULE OF INVENTORY September 30, 2021 December 31, 2020 Raw Materials $ 1,006,096 $ 991,523 Semi-Finished 1,317,948 1,372,950 Finished Goods 1,998,260 6,018,530 Packaging 16,281 20,938 Trading 5,793 5,793 Total $ 4,344,378 $ 8,409,734 |
OPERATING LEASE RIGHT-OF-USE _2
OPERATING LEASE RIGHT-OF-USE ASSETS AND OPERATING LEASE LIABILITIES – RELATED PARTY (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Operating Lease Right-of-use Assets And Operating Lease Liabilities Related Party | |
SCHEDULE OF RIGHT OF USE ASSET AND LIABILITY | Below is a summary of our right of use assets and liabilities as of September 30, 2021. SCHEDULE OF RIGHT OF USE ASSET AND LIABILITY September 30, 2021 December 31, 2020 Right-of-use assets $ 3,681,682 $ 3,937,706 Present value of operating lease liabilities $ 3,775,942 $ 4,022,870 Less: Long-term portion of operating lease liability (3,434,571 ) (3,692,392 ) Short-term portion of operating lease liability 341,371 330,478 Unpaid balances 1,167,372 832,391 Total short-term lease liability obligations $ 1,508,743 $ 1,162,869 Weighted-average remaining lease term (Ends December 31, 2030) 9.25 10 Weighted-average discount rate 3.0 % Right-of-use assets $ 3,681,682 Total lease liability obligations $ 4,943,314 Weighted-average remaining lease term (Ends December 31, 2030) 9.25 |
SCHEDULE OF MATURITY OF OPERATING LEASE LIABILITIES | Approximate future minimum lease payments for our right of use assets over the remaining lease periods as of September 30, 2021, are as follows: SCHEDULE OF MATURITY OF OPERATING LEASE LIABILITIES 2021 $ 111,661 2022 451,110 2023 455,622 2024 460,178 2025 464,780 Thereafter 2,394,550 Total undiscounted operating lease payments 4,337,901 Less: Imputed interest (561,959 ) Present value of operating lease liabilities $ 3,775,942 |
NOTES PAYABLE (Tables)
NOTES PAYABLE (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
SCHEDULE OF NOTES PAYABLE | SCHEDULE OF NOTES PAYABLE September 30, 2021 December 31, 2020 Notes payable - related party (1) $ 4,062,713 $ 7,911,044 Notes payable – related party (2) 2,077,886 150,000 Notes payable -related party (3) - 7,000,000 Notes payable - related party (4) 75,556 - Total related party notes $ 6,216,155 $ 15,061,044 Paycheck protection loan (5) $ - $ 273,300 SBA loan (4) 99,100 - Total Paycheck protection and SBA loan $ 99,100 $ 273,300 September 30, 2021 December 31, 2020 Other liability—related party SAP software, support and building modifications (6) $ 2,529,248 $ 2,185,269 J&N Building Loan (7) 513,390 513,390 Total $ 3,042,638 $ 2,698,659 (1) Payable to Quintel. As part of the agreement in the reverse merger transaction the Quintel loans and historical interest owed of $ 1,932,358 4.062 4.7 (2) Payable to CEO, secured by XXII common stock. (3) Convertible debt owed to XXII. On June 30, 2021 the $ 7 2.2 500,000 4.3 (4) Liability carried over from Exactus (5) Paycheck protection loans include Exactus’ and Panacea’s loans. (6) Accrued expenses related to SAP software and implementation services. Software enhancements for production related functionality and user interface were added in 2020 and 2021. In 2019 the initial implementation of the system was completed. (7) The J&N Real Estate Company loan for Panacea Building capital was made in 2020 |
STOCKHOLDERS_ EQUITY (Tables)
STOCKHOLDERS’ EQUITY (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
SCHEDULE OF STOCK OPTIONS | A summary of the stock option activity is presented below: SCHEDULE OF STOCK OPTIONS Options Outstanding as of September 30, 2021 Number of Shares Subject to Options Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Life (in years) Aggregate Balance on December 31, 2020 - - - - Options assumed in merger 196,491 $ 3.64 3.70 192,500 Options granted - - - - Options exercised - - - - Options canceled / expired - - - - Balance at September 30, 2021 196,491 $ 3.64 3.45 $ 192,500 Vested and exercisable at September 30, 2021 196,491 $ 3.64 3.45 $ 192,500 |
SUMMARY OF STOCK WARRANTS | SUMMARY OF STOCK WARRANTS Name Expire Number of Shares Average Exercise Balance on December 31, 2020 - - - Assumed in Merger 56,337 $ 13.64 Total as of September 30, 2020 56,337 $ 13.64 |
SUMMARY OF RESTRICTED STOCK | A summary of the restricted stock activity is presented below: SUMMARY OF RESTRICTED STOCK Restricted Stock Common Stock Balance at December 31, 2020 - Assumed in merger 107,993 Balance at September 30, 2021 107,993 |
SCHEDULE OF PREFERRED STOCK | PANACEA LIFE SCIENCES HOLDINGS, INC. AND SUBSIDIARY CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ (DEFICIT) EQUITY (unaudited) SCHEDULE OF PREFERRED STOCK Three Months Ended September 30, 2021 Preferred Stock Convertible - Series A Shares Preferred Stock Series B-1 Shares Preferred Stock Series B-2 Shares Preferred Stock Series C Shares Preferred Stock Series C-1 Shares Preferred Stock Series D Shares Total Preferred Stock Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Balance as of June 30, 2021 450 $ - 1,500,000 $ 150 6,000,000 $ 600 1,000,000 $ 100 10,000 $ 1 10,000 $ 1 8,520,450 $ 852 Shares issued for acquisition Shares issued for acquisition, shares Series A Preferred stock converted to common shares (100 ) - - - - - - - - - - - (100 ) - Balance as of September 30, 2021 350 $ - 1,500,000 $ 150 6,000,000 $ 600 1,000,000 $ 100 10,000 $ 1 10,000 $ 1 8,520,350 $ 852 Nine Months Ended September 30, 2021 Preferred Stock Convertible - Series A Shares Preferred Stock Series B-1 Shares Preferred Stock Series B-2 Shares Preferred Stock Series C Shares Preferred Stock Series C-1 Shares Preferred Stock Series D Shares Total Preferred Stock Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Balance as of December 31, 2020 - $ - - $ - - - 1,000,000 $ 100 10,000 $ 1 10,000 $ 1 1,020,000 $ 102 Shares issued for acquisition 450 - 1,500,000 150 6,000,000 600 - - - - - - 7,500,000 750 Series A Preferred stock converted to common shares (100 ) - - - - - - - - - - (100 ) - Balance as of September 30, 2021 350 $ - 1,500,000 $ 150 6,000,000 600 1,000,000 $ 100 10,000 $ 1 10,000 $ 1 8,520,350 $ 852 Three Months Ended September 30, 2020 Preferred Stock Convertible - Series A Shares Preferred Stock Series B-1 Shares Preferred Stock Series B-2 Shares Preferred Stock Series C Shares Preferred Stock Series C-1 Shares Preferred Stock Series D Shares Total Preferred Stock Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Balance as of June 30, 2020 - $ - - $ - - $ - 1,000,000 $ 100 10,000 $ 1 10,000 $ 1 1,020,000 $ 102 Shares issued for acquisition - - - - - - - - - - - - - - Balance as of September 30, 2020 - $ - $ - - $ - 1,000,000 $ 100 10,000 $ 1 10,000 $ 1 1,020,000 $ 102 Nine Months Ended September 30, 2020 Preferred Stock Convertible - Series A Shares Preferred Stock Series B-1 Shares Preferred Stock Series B-2 Shares Preferred Stock Series C Shares Preferred Stock Series C-1 Shares Preferred Stock Series D Shares Total Preferred Stock Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Balance as of December 31, 2020 - $ - - $ - - $ - 1,000,000 $ 100 10,000 $ 1 10,000 $ 1 1,020,000 $ 102 Shares issued for acquisition - - - - - - - - - - - - - - Balance as of September 30, 2020 - $ - $ - - $ - 1,000,000 $ 100 10,000 $ 1 10,000 $ 1 1,020,000 $ 102 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Related Party Transactions [Abstract] | |
SCHEDULE OF RELATED PARTY TRANSACTIONS LOANS | The accrued interest and interest expenses recorded for related party loans are shown below. SCHEDULE OF RELATED PARTY TRANSACTIONS LOANS September 30, 2021 December 31, 2020 Accrued Interest Related party loan-Quintel $ 123,104 $ 1,347,356 Related party loan-CEO loan 42,494 1,500 Related party loan-XXII - - Related party loan – Line of credit 9,129 - Accrued Interest Related party loan Three months ended Nine months ended Three months ended Nine months ended Interest Expense Related party loan-Quintel $ 123,104 $ 645,628 $ 257,234 $ 643,171 Related party loan-CEO loan 42,494 102,679 - - Related party loan-XXII - - 175,000 525,000 Related party loan – Line of Credit 9,129 9,129 - - Interest Expense Related party loan |
RESTATED FINANCIAL STATEMENTS_2
RESTATED FINANCIAL STATEMENTS AND EXPLANATIONS (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
SCHEDULE OF EFFECTS OF RESTATEMENT | The effects of the restatement on the line items within the Company’s condensed consolidated balance sheets as of September 30, 2021 are as follows: SCHEDULE OF EFFECTS OF RESTATEMENT (a) Amortization of right of use asset was recorded twice in initial filing. (b) Reflects reversal of depreciation that was previously posted on asset that was retired. (c) To separately report short and long-term amounts associated with right of use asset. Panacea Life Sciences Holdings, Inc. and Subsidiary Unaudited Condensed Consolidated Balance Sheets September 30, 2021 December 31, 2020 September 30, 2021 December 31, 2020 September 30, 2021 December 31, 2020 As Restated Adjustment As Reported September 30, 2021 December 31, 2020 September 30, 2021 December 31, 2020 September 30, 2021 December 31, 2020 (Unaudited) (Unaudited) (Unaudited) ASSETS CURRENT ASSETS: Cash and cash equivalents $ 14,500 $ 84,379 $ - $ - $ 14,500 $ 84,379 Accounts receivable, net 515,095 147,302 - - 515,095 147,302 Other receivables, related party 500,000 - - - 500,000 - Inventory, net 4,344,378 8,409,734 - - 4,344,378 8,409,734 Marketable securities related party 3,631,970 2,853,437 - - 3,631,970 2,853,437 Prepaid expenses and other current assets 193,596 27,375 - - 193,596 27,375 TOTAL CURRENT ASSETS 9,199,539 11,522,227 - - 9,199,539 11,522,227 Operating lease right-of-use asset, net, related party 3,681,682 3,937,706 (a) 57,237 - 3,624,445 3,937,706 Property and equipment, net 9,024,505 13,590,286 (b) - 14,600 9,024,505 13,575,687 Intangible assets, net 76,751 122,801 - - 76,751 122,800 Goodwill 2,188,810 2,188,810 - - 2,188,810 2,188,810 TOTAL ASSETS $ 24,171,287 $ 31,361,830 $ 57,237 $ 14,600 $ 24,114,050 $ 31,347,230 LIABILITIES AND STOCKHOLDERS’ EQUITY CURRENT LIABILITIES: Accounts payable and accrued expenses $ 1,474,681 $ 1,765,267 $ - $ - $ 1,474,681 $ 1,765,267 Operating lease liability, current portion, related party 1,508,743 1,162,869 (c) (3,453,787 ) (3,692,381 ) 4,962,530 4,855,250 Note payable-current, related party 6,216,155 15,061,044 - - 6,216,155 15,061,044 Paycheck protection loan, SBA Loan 99,100 273,300 - - 99,100 273,300 TOTAL CURRENT LIABILITIES: 9,298,679 18,262,480 (3,453,787 ) (3,692,381 ) 12,752,466 21,954,861 Operating lease liability, long-term portion, related party 3,434,571 3,692,392 (c) 3,434,571 3,692,392 - - Other long-term liabilities, related party 3,042,638 2,698,659 (c) - - 3,042,638 2,698,659 TOTAL LIABILITIES 15,775,888 24,653,531 (19,216 ) 11 15,795,104 24,653,520 Commitments and contingencies - - - - - - STOCKHOLDERS’ EQUITY - Series A Preferred Stock: $ 0.0001 1,000 450 0 - - - - - - Series B-1 Preferred: $ 0.0001 32,000,000 1,500,000 0 150 - - - 150 - Series B-2 Preferred: $ 0.0001 6,000,000 6,000,000 0 600 - - - 600 - Series C Preferred: $ 0.0001 1,000,000 1,000,000 1,000,000 100 100 - - 100 100 Series C-1 Preferred: $ 0.0001 10,000 10,000 10,000 1 1 - - 1 1 Series D Preferred: $ 0.0001 10,000 10,000 10,000 1 1 - - 1 1 Preferred stock value Common Stock: $ 0.0001 650,000,000 21,393,041 16,915,706 2,139 1,692 - - 2,139 1,692 Additional paid in capital 23,066,914 18,689,119 (b) (14,588 ) (0 ) 23,081,502 18,689,119 Accumulated deficit (14,674,506 ) (11,982,614 ) (b) 91,041 14,589 (14,765,547 ) (11,997,203 ) TOTAL STOCKHOLDERS’ EQUITY 8,395,399 6,708,299 76,453 14,589 8,318,946 6,693,710 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 24,171,287 $ 31,361,830 $ 57,237 $ 14,600 $ 24,114,050 $ 31,347,230 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. The effects of the restatement on the line items within the Company’s condensed consolidated statements of operations and comprehensive income for the six months ended September 30, 2021 are as follows: (a) Amortization of right of use asset was recorded twice in initial filing. Panacea Life Sciences Holdings, Inc. and Subsidiary Unaudited Condensed Consolidated Statements of Operations 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 As Restated Adjustment As Reported Three Months Ended September 30, Nine Months Ended September 30, Three Months Ended September 30, Nine Months Ended September 30, Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 REVENUE $ 588,040 $ 1,343,641 $ 1,413,674 $ 8,305,630 $ $ $ - $ - $ 588,040 $ 1,343,641 $ 1,413,674 $ 8,305,630 COST OF SALES 305,025 2,905,780 883,508 6,285,879 - - - - 305,025 2,905,780 883,508 6,285,879 GROSS PROFIT (LOSS) 283,015 (1,562,139 ) 530,166 2,019,751 - - - - 283,015 (1,562,139 ) 530,166 2,019,751 OPERATING EXPENSES Production related operating expenses 1,250,434 1,307,169 3,407,407 3,012,485 (a) (76,462 ) 5 (76,452 ) 10 1,326,896 1,307,164 3,483,859 3,012,475 General and administrative expenses 290,638 478,992 911,906 2,547,438 - (4,205 ) - (4,205 ) 290,638 483,197 911,906 2,551,643 TOTAL OPERATING EXPENSES 1,541,072 1,786,161 4,319,313 5,559,923 (76,462 ) (4,200 ) (76,452 ) (4,195 ) 1,617,534 1,790,361 4,395,765 5,564,118 INCOME (LOSS) FROM OPERATIONS (1,258,057 ) (3,348,300 ) (3,789,147 ) (3,540,172 ) (a) 76,462 4,200 76,452 4,195 (1,334,519 ) (3,352,500 ) (3,865,599 ) (3,544,367 ) OTHER INCOME (EXPENSES) Interest expense (174,727 ) (432,922 ) (781,671 ) (1,181,165 ) - - - - (174,727 ) (432,922 ) (781,671 ) (1,181,165 ) Unrealized gain (loss) on marketable securities, net (2,303,218 ) (160,310 ) 848,533 (595,590 ) - (60,818 ) - 16,891 (2,303,218 ) (99,492 ) 848,533 (612,481 ) Realized gain on sale of securities 160,296 - 160,296 - - - - - 160,296 - 160,296 - Other income (loss) - 56,619 - (21,090 ) - 56,619 - (21,090 ) Employer retention credit 190,338 - 190,338 - - - - - 190,338 - 190,338 - Rental Income 58,410 56,577 221,328 212,778 - - - - 58,410 56,577 221,328 212,778 Gain (loss) on sale of assets - 48,621 (297,351 ) (19,093 ) - - - - - 48,621 (297,351 ) (19,093 ) Gain on extinguishment of debt 237,202 - 755,782 - - - - - 237,202 - 755,782 - TOTAL OTHER INCOME (EXPENSE) (1,831,699 ) (431,415 ) 1,097,255 (1,604,160 ) - (4,199 ) - (4,199 ) (1,831,699 ) (427,216 ) 1,097,255 (1,599,961 ) INCOME (LOSS) BEFORE INCOME TAXES (3,089,756 ) (3,779,715 ) (2,691,892 ) (5,144,332 ) (a) 76,462 1 76,452 (4 ) (3,166,218 ) (3,779,716 ) (2,768,344 ) (5,144,328 ) TAXES - - - - - - - - - - - - NET INCOME (LOSS) $ (3,089,756 ) $ (3,779,715 ) $ (2,691,892 ) $ (5,144,332 ) (a) $ 76,462 $ 1 $ 76,452 $ (4 ) $ (3,166,218 ) $ (3,779,716 ) $ (2,768,344 ) $ (5,144,328 ) BASIC NET INCOME (LOSS) PER SHARE $ (0.14 ) $ (0.22 ) $ (0.15 ) $ (0.30 ) $ 0.00 $ 0.00 $ (0.02 ) $ (0.00 ) $ (0.15 ) $ (0.22 ) $ (0.13 ) $ (0.30 ) DILUTED NET INCOME (LOSS) PER SHARE $ (0.14 ) $ (0.22 ) $ (0.15 ) $ (0.30 ) $ 0.00 $ 0.00 $ (0.02 ) $ (0.00 ) $ (0.15 ) $ (0.22 ) $ (0.13 ) $ (0.30 ) WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING Basic 21,389,041 16,915,706 18,422,459 16,915,706 - - (2,966,582 ) - 21,389,041 16,915,706 21,389,041 16,915,706 Diluted 21,389,041 16,915,706 18,422,459 16,915,706 - - (2,966,582 ) - 21,389,041 16,915,706 21,389,041 16,915,706 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. The effects of the restatement on the line items within the Company’s condensed statement of stockholders’ equity as of September 30, 2021 are as follows: (a) The changes in the “Accumulated Deficit” reflects the accumulated difference of the changes reported in the Statement of Operations. (b) The change in “Additional Paid-in Capital” reflects reclass and adjustments associated with the Company 1 to 28 reverse split of its Common Stock. (c) The changes in “Net Income” reflects the accumulated difference of the changes reported in the Statement of Operations for the period. Panacea Life Sciences Holdings, Inc. and Subsidiary UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY Preferred Stock Common Stock Additional Paid-in Accumulated Total Stockholder’s Additional Paid-in Accumulated Total Stockholder’s Preferred Stock Common Stock Additional Paid-in Accumulated Total Stockholder’s As restated Adjustment Three Months Ended September 30, 2021 Three Months Ended September 30, 2021 Preferred Stock Common Stock Additional Paid-in Accumulated Total Stockholder’s Additional Paid-in Accumulated Total Stockholder’s Preferred Stock Common Stock Additional Paid-in Accumulated Total Stockholder’s Shares Amount Shares Amount Capital Deficit Equity Capital Deficit Equity Shares Amount Shares Amount Capital Deficit Equity Balance as of June 30, 2021 8,520,450 $ 852 21,321,613 $ 2,132 $ 23,066,921 $ (11,584,750 ) $ 11,485,155 (a) (b) $ (4,455 ) $ 4,446 $ (9 ) 8,520,450 $ 852 21,321,613 $ 2,132 $ 23,071,376 $ (11,589,196 ) $ 11,485,164 Shares issued for acquisition Shares issued for acquisition, shares Series A Preferred stock conversion to common stock (100 ) - 71,429 7 (7 ) - (b) - - - (100 ) - 71,429 7 (7 ) - Net Loss - - - - - (3,089,756 ) (3,089,756 ) (c) - 76,462 76,462 - - - - - (3,166,218 ) (3,166,218 ) Balance as of September 30, 2021 8,520,350 $ 852 21,393,042 $ 2,139 $ 23,066,914 $ (14,674,506 ) $ 8,395,399 $ (4,455 ) $ 80,908 $ 76,453 8,520,350 $ 852 21,393,042 $ 2,139 $ 23,071,369 $ (14,755,414 ) $ 8,318,946 Nine Months Ended September 30, 2021 Nine Months Ended September 30, 2021 Preferred Stock Common Stock Additional Paid-in Accumulated Total Stockholder’s Preferred Stock Common Stock Additional Paid-in Accumulated Total Stockholder’s Shares Amount Shares Amount Capital Deficit Equity Shares Amount Shares Amount Capital Deficit Equity Balance as of December 31, 2020 1,020,000 $ 102 16,915,706 $ 1,692 $ 18,689,119 $ (11,982,614 ) $ 6,708,299 (a) (b) $ 10,133 $ 4,456 $ 14,589 1,020,000 $ 102 16,915,706 $ 1,692 $ 18,678,986 $ (11,987,070 ) $ 6,693,710 Shares issued for acquisition 7,500,450 750 4,405,907 440 4,377,802 4,378,992 (b) (14,588 ) - (14,588 ) 7,500,450 750 4,405,907 440 4,392,390 4,393,580 Series A Preferred stock conversion to common stock (100 ) - 71,429 7 (7 ) - - - - (100 ) - 71,429 7 (7 ) - Net Loss - - - - - (2,691,892 ) (2,691,892 ) (c) - 76,452 76,452 - - - - - (2,768,344 ) (2,768,344 ) Balance as of September 30, 2021 8,520,350 $ 852 21,393,042 $ 2,139 $ 23,066,914 $ (14,674,506 ) $ 8,395,399 $ (4,455 ) $ 80,908 $ 76,453 8,520,350 $ 852 21,393,042 $ 2,139 $ 23,071,369 $ (14,755,414 ) $ 8,318,946 Three Months Ended September 30, 2020 Three Months Ended September 30, 2020 Preferred Stock Common Stock Additional Paid-in Accumulated Total Stockholder’s Preferred Stock Common Stock Additional Paid-in Accumulated Total Stockholder’s Shares Amount Shares Amount Capital Deficit Equity Shares Amount Shares Amount Capital Deficit Equity Balance as of June 30, 2020 1,020,000 $ 102 16,915,706 $ 1,692 $ 18,689,119 $ (8,115,401 ) $ 10,575,512 (a) (b) $ 236,847 $ (10,142 ) $ 226,705 1,020,000 $ 102 16,915,706 $ 1,692 $ 18,452,272 $ (8,105,259 ) $ 10,348,807 Net Loss - - - - - (3,779,715 ) (3,779,715 ) - - - - - - - - (3,779,715 ) (3,779,715 ) Balance as of September 30, 2020 1,020,000 $ 102 16,915,706 $ 1,692 $ 18,689,119 $ (11,895,116 ) $ 6,795,797 $ 236,847 $ (10,142 ) $ 226,705 1,020,000 $ 102 16,915,706 $ 1,692 $ 18,452,272 $ (11,884,974 ) $ 6,569,092 Nine Months Ended September 30, 2020 Nine Months Ended September 30, 2020 Preferred Stock Common Stock Additional Paid-in Accumulated Total Stockholder’s Preferred Stock Common Stock Additional Paid-in Accumulated Total Stockholder’s Shares Amount Shares Amount Capital Deficit Equity Shares Amount Shares Amount Capital Deficit Equity Balance as of December 31, 2019 1,020,000 $ 102 16,915,706 $ 1,692 $ 18,689,119 $ (6,750,784 ) $ 11,940,129 (a) (b) $ 236,847 $ (10,137 ) $ 226,710 1,020,000 $ 102 16,915,706 $ 1,692 $ 18,452,272 $ (6,740,647 ) $ 11,713,419 Net Loss - - - - - (5,144,332 ) (5,144,332 ) (c) - (5 ) (5 ) - - - - - (5,144,327 ) (5,144,327 ) Balance as of September 30, 2020 1,020,000 $ 102 16,915,706 $ 1,692 $ 18,689,119 $ (11,895,116 ) $ 6,795,797 $ 236,847 $ (10,142 ) $ 226,705 1,020,000 $ 102 16,915,706 $ 1,692 $ 18,452,272 $ (11,884,974 ) $ 6,569,092 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements The effects of the restatement on the line items within the Company’s condensed consolidated statement of cash flow as of September 30, 2021 are as follows: (a) Reflects previously unrecorded expenses. (b) Amortization of right of use asset being reported as a net amount with liability reduction. (c) Reflects liabilities acquired in merger being reported as non-cash items. (d) Reflects PPE sale to related party being reclassified as non-cash item. (e) Reflects retirement of accrued interest as being reclassified to non-cash item. (f) To separately report asset proceeds and disposals that were originally presented as a net amount. (g) Reflects amount related to note payable that was previously reported as account payable. (h) To separately report non-cash receivable due. (i) To separately report asset retirement and notes payable retirement due to merger (j) To reclassify non-cash items from merger to non-cash investing and financing activities (k) To separately report proceeds and payments on notes payable that were originally presented as a net amount. (l) To report changes in depreciation as a result of asset retirement. (m) To report interest payments made that were previously not separately disclosed. (n) To reclassify non-cash stock issuances to non-cash transactions section. (o) To correct a footing error. Panacea Life Sciences Holdings, Inc. and Subsidiary Unaudited Condensed Consolidated Statements of Cash Flows 2021 2020 2021 2020 2021 2020 As Restated Adjustment As Reported Nine Months Ended September 30, Nine Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 2021 2020 Cash flows from operating activities Net income (loss) $ (2,691,892 ) $ (5,144,332 ) (a) $ 76,452 $ (5 ) $ (2,768,344 ) $ (5,144,327 ) Adjustments to reconcile net income (loss) to net cash used in operating activities Depreciation 1,280,324 1,018,567 (l) - (626,635 ) 1,280,324 1,645,202 Realized gain on sale of securities (160,296 ) - (160,296 ) - Fixed asset disposal loss 297,351 19,093 - - 297,351 19,093 Amortization of right of use asset - - (b) (313,261 ) (249,037 ) 313,261 249,037 Amortization of intangible assets 46,050 46,050 (o) 1 - 46,049 46,050 Non cash settlement of convertible note and accrued interest (752,751 ) - (c) (99,100 ) - (653,651 ) - Unrealized gain/loss on marketable securities (848,533 ) 595,590 - - (848,533 ) 595,590 Changes in operating assets and liabilities Accounts receivable (367,793 ) 91,952 - - (367,793 ) 91,952 Inventory (628,011 ) (5,463,820 ) (d) (2,132,450 ) - 1,504,439 (5,463,820 ) Prepaid expense and other assets (166,221 ) 647,257 - - (166,221 ) 647,257 Accounts payable and accrued expenses 955,493 1,226,146 (e)(g) 1,931,562 - (976,069 ) 1,226,146 Operating lease liability, net 344,076 344,085 (b) 236,796 249,043 107,280 95,042 Net cash used in operating activities (2,692,203 ) (6,619,412 ) (300,000 ) (626,634 ) (2,392,203 ) (5,992,778 ) Cash flows from investing activities Net cash received in from acquisitions 9,157 - - - 9,157 - Proceeds from sale of marketable securities 230,296 - - - 230,296 - Proceeds from sale of fixed assets 446,026 34,920 (f) 446,026 34,920 Net fixed asset acquisition (172,397 ) (3,301,527 ) (f) (446,026 ) 474,594 273,629 (3,776,121 ) Net Cash provided by (used in) investing activities 513,082 (3,266,607 ) 1 509,514 513,082 (3,776,121 ) Cash flows from financing activities - - Proceeds from payroll protection loan, SBA loan - 273,300 - - - 273,300 Proceeds from payroll protection loan - related party 243,041 - - - 243,041 - Payments of principal on notes payable - related party (135,000 ) (3,503,545 ) (k) - (3,503,545 ) (135,000 ) - Proceeds from notes payable - related party 2,001,201 5,134,225 (g) 300,000 3,620,665 1,701,201 1,513,560 Net cash provided by financing activities 2,109,242 1,903,980 300,000 117,120 1,809,242 1,786,860 Net increase (decrease) in Cash and Cash Equivalents (69,879 ) (7,982,039 ) (o) 0 1 (69,879 ) (7,982,040 ) Cash and Cash Equivalents, Beginning of Period 84,379 8,515,509 - - 84,379 8,515,509 Cash and Cash Equivalents, End of Period $ 14,500 $ 533,470 $ 0 $ 1 $ 14,500 $ 533,469 Supplemental Disclosure of Cash Flow Information Cash paid for income taxes during the year $ - $ - $ - $ - $ - $ - Interest payments during the year $ - $ 525,000 (m) $ - $ 525,000 $ - $ - - Noncash investing and financing activity Non-Cash Receivable - related party $ (500,000 ) $ - (h) $ (3,543,858 ) $ - $ 3,043,858 $ - Related party loan repayment with inventory $ 4,693,367 $ - (i) $ 12,543,540 $ - $ (7,850,173 ) $ - Noncash fixed asset disposal as part of the reverse acquisition $ 3,058,457 $ - (i) $ 1,709,357 $ - $ 1,349,100 $ - Capitalized assets purchased on account - related party $ 343,979 $ 396,270 (d) $ (341,504 ) $ 396,270 $ 685,483 $ - Liabilities from acquisition $ 1,096,782 $ - (c) $ 860,372 $ - $ 236,410 $ - Debt retired in merger, related party $ (12,718,441 ) $ - (j) $ (17,089,778 ) $ - $ 4,371,337 $ - Preferred Series B-1 Issuance in Acquisition $ 150 $ - $ - $ - $ 150 $ - Preferred Series B-2 Issuance in Acquisition $ 600 $ - $ - $ - $ 600 $ - Common stock issued for the reverse merger with Exactus $ 4,369,085 $ - (n) $ 4,356,748 $ - $ 12,337 $ - |
FAIR VALUE, ASSETS MEASURED ON
FAIR VALUE, ASSETS MEASURED ON RECURRING BASIS (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Fair Value Assets | $ 3,631,970 | $ 2,853,437 |
Fair Value, Inputs, Level 1 [Member] | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Fair Value Assets | 3,631,970 | 2,853,437 |
Fair Value, Inputs, Level 2 [Member] | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Fair Value Assets | ||
Fair Value, Inputs, Level 3 [Member] | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Fair Value Assets | ||
Marketable Securities [Member] | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Fair Value Assets | 3,631,970 | 2,853,437 |
Marketable Securities [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Fair Value Assets | 3,631,970 | 2,853,437 |
Marketable Securities [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Fair Value Assets | ||
Marketable Securities [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Debt Securities, Held-to-maturity, Allowance for Credit Loss [Line Items] | ||
Fair Value Assets |
SCHEDULE OF MARKETABLE SECURITI
SCHEDULE OF MARKETABLE SECURITIES (Details) | 9 Months Ended |
Sep. 30, 2021USD ($) | |
Accounting Policies [Abstract] | |
Balance at beginning of year | $ 2,853,437 |
Sale of securities | (230,296) |
Realized gain on sale of securities | 160,296 |
Unrealized gain on marketable securities, net | 848,533 |
Balance at end of period | $ 3,631,970 |
SCHEDULE OF REVENUE FROM CONTRA
SCHEDULE OF REVENUE FROM CONTRACT WITH CUSTOMER (Details) - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Accounting Policies [Abstract] | ||
Balance, beginning of period | $ 121,300 | $ 254,786 |
Payments received for unearned revenue | 31,725 | 463,454 |
Revenue earned | 132,955 | 596,940 |
Balance, end of period | $ 20,070 | $ 121,300 |
SCHEDULE OF ANTI-DILUTIVE DILUT
SCHEDULE OF ANTI-DILUTIVE DILUTED LOSS PER SHARE (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 5,389,753 | 5,383,541 | ||
Options [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 61,446 | 61,446 | ||
Warrant [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 56,377 | 56,377 | ||
Series A Convertible Preferred Stock [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 256,211 | 250,000 | ||
Series B-1 Convertible Preferred Stock [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 6,679 | 6,679 | ||
Series B Two Convertible Preferred Stock [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 26,786 | 26,786 | ||
Series C Convertible Preferred Stock [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 2,289,220 | 2,289,220 | ||
Series C-1 Convertible Preferred Stock [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 1,064,908 | 1,064,908 | ||
Series D Convertible Preferred Stock [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 1,628,126 | 1,628,126 |
SCHEDULE OF INTANGIBLE ASSETS A
SCHEDULE OF INTANGIBLE ASSETS AND GOODWILL (Details) - USD ($) | 9 Months Ended | ||
Sep. 30, 2021 | Dec. 31, 2020 | Oct. 31, 2017 | |
Restructuring Cost and Reserve [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 5 years | ||
Goodwill | $ 2,188,810 | $ 2,188,810 | |
Intangibles – Formulations | 307,001 | 307,001 | |
Less accumulated amortization | (230,250) | (184,200) | |
Net intangible assets | $ 76,751 | $ 122,801 | |
Phoenix Life Sciences, Inc. [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Goodwill from Phoenix Acquisition , Estimated Life | Tested Yearly for Impairment | ||
Goodwill | $ 2,189,000 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | Aug. 25, 2021 | Aug. 05, 2021 | Oct. 31, 2021 | Oct. 25, 2021 | Aug. 31, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Nov. 22, 2021 | Oct. 31, 2017 |
Accumulated deficit | $ 14,675,000 | $ 14,675,000 | ||||||||||
Cash | 3,646,000 | 3,646,000 | ||||||||||
Common stock value | 2,139 | 2,139 | $ 1,692 | |||||||||
Gain on sale of marketable securities | 160,296 | 160,296 | ||||||||||
Advanced customer payments | 31,725 | 463,454 | ||||||||||
Business acquisition, goodwill | 2,188,810 | 2,188,810 | 2,188,810 | |||||||||
Phoenix Life Sciences, Inc. [Member] | ||||||||||||
Business acquisition, goodwill | $ 2,189,000 | |||||||||||
Business acquisition, Intangible assets | $ 77,000 | 77,000 | $ 123,000 | |||||||||
General and Administrative Expense [Member] | ||||||||||||
Shipping and handling costs | 12,603 | 54,429 | ||||||||||
Advertising costs | $ 292,157 | $ 1,375,962 | ||||||||||
XXII Common Stock [Member] | ||||||||||||
Sale of Stock, Number of Shares Issued in Transaction | 70,000 | 70,000 | ||||||||||
Sale of stock price per share | $ 3.29 | |||||||||||
Sale of Stock, Consideration Received on Transaction | $ 230,296 | $ 230,296 | ||||||||||
Gain on sale of marketable securities | $ 160,296 | |||||||||||
Marketable Securities [Member] | ||||||||||||
Investment owned, shares | 1,227,017 | 1,227,017 | ||||||||||
Subsequent Event [Member] | ||||||||||||
Convertible note and warrants financing | $ 1,100,000 | |||||||||||
Reverse Stock Split | 1-for-28 reverse stock split. | 1-for-28 reverse stock split | ||||||||||
Leslie Buttorff [Member] | ||||||||||||
Notes Payable, Current | $ 1,624,000 | $ 1,624,000 | ||||||||||
22nd Century Group, Inc [Member] | ||||||||||||
Common stock shares hold | 1,227,017 | 1,227,017 | ||||||||||
Common stock value | $ 3,631,000 | $ 3,631,000 | ||||||||||
Quintel MC, Inc [Member] | ||||||||||||
Notes Payable, Current | $ 4,063,000 | $ 4,063,000 |
SCHEDULE OF PROPERTY PLANT AND
SCHEDULE OF PROPERTY PLANT AND EQUIPMENT USEFUL LIVES (Details) | 9 Months Ended |
Sep. 30, 2021 | |
Computer Equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 3 years |
Computer Equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 5 years |
Furniture and Fixtures [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 3 years |
Furniture and Fixtures [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 5 years |
Machinery and Equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 5 years |
Machinery and Equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 10 years |
Leasehold Improvements [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 10 years |
SCHEDULE OF PROPERTY AND EQUIPM
SCHEDULE OF PROPERTY AND EQUIPMENT (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Total | $ 12,491,355 | $ 16,089,637 |
Less accumulated depreciation | (3,466,850) | (2,499,351) |
Total property and equipment, net | 9,024,505 | 13,590,286 |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total | 3,310,025 | 2,993,626 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total | 55,951 | 55,951 |
Machinery and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total | 7,524,242 | 8,494,296 |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total | 92,222 | 2,293,472 |
Asset under Construction [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total | 743,377 | |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total | $ 1,508,915 | $ 1,508,915 |
PROPERTY, EQUIPMENT, NET OF A_3
PROPERTY, EQUIPMENT, NET OF ACCUMULATED DEPRECIATION (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |||||
Depreciation | $ 392,485 | $ 371,314 | $ 1,280,324 | $ 1,018,567 | |
Sale on fixed assets | 743,377 | $ 260,337 | |||
Gain and loss on sale of asset | $ (48,621) | $ 297,351 | $ 19,093 | $ 140,714 |
SCHEDULE OF INVENTORY (Details)
SCHEDULE OF INVENTORY (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Inventory Disclosure [Abstract] | ||
Raw Materials | $ 1,006,096 | $ 991,523 |
Semi-Finished | 1,317,948 | 1,372,950 |
Finished Goods | 1,998,260 | 6,018,530 |
Packaging | 16,281 | 20,938 |
Trading | 5,793 | 5,793 |
Total | $ 4,344,378 | $ 8,409,734 |
SCHEDULE OF RIGHT OF USE ASSET
SCHEDULE OF RIGHT OF USE ASSET AND LIABILITY (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Lessee, Lease, Description [Line Items] | ||
Right-of-use assets | $ 3,681,682 | $ 3,937,706 |
Present value of operating lease liabilities | 3,775,942 | |
Less: Long-term portion of operating lease liability | (3,434,571) | (3,692,392) |
Short-term portion of operating lease liability | 1,508,743 | 1,162,869 |
Total short-term lease liability obligations | 1,508,743 | $ 1,162,869 |
Weighted-average discount rate | 3.00% | |
Total lease liability obligations | 4,943,314 | |
Operating Lease Liabilities [Member] | ||
Lessee, Lease, Description [Line Items] | ||
Right-of-use assets | 3,681,682 | $ 3,937,706 |
Present value of operating lease liabilities | 3,775,942 | 4,022,870 |
Less: Long-term portion of operating lease liability | (3,434,571) | (3,692,392) |
Short-term portion of operating lease liability | 341,371 | 330,478 |
Unpaid balances | $ 1,167,372 | $ 832,391 |
Weighted-average remaining lease term | 9 years 3 months | 10 years |
SCHEDULE OF MATURITY OF OPERATI
SCHEDULE OF MATURITY OF OPERATING LEASE LIABILITIES (Details) | Sep. 30, 2021USD ($) |
Operating Lease Right-of-use Assets And Operating Lease Liabilities Related Party | |
2021 | $ 111,661 |
2022 | 451,110 |
2023 | 455,622 |
2024 | 460,178 |
2025 | 464,780 |
Thereafter | 2,394,550 |
Total undiscounted operating lease payments | 4,337,901 |
Less: Imputed interest | (561,959) |
Present value of operating lease liabilities | $ 3,775,942 |
OPERATING LEASE RIGHT-OF-USE _3
OPERATING LEASE RIGHT-OF-USE ASSETS AND OPERATING LEASE LIABILITIES – RELATED PARTY (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Sep. 30, 2021 | Dec. 31, 2020 | |
Right of use asset | $ 3,681,682 | $ 3,681,682 | $ 3,937,706 |
Corresponding lease liability | $ 3,775,942 | $ 3,775,942 | |
Lease term | 3 years | 3 years | |
Operating lease costs | $ 114,693 | $ 344,079 | $ 458,772 |
Accounting Standards Update 2016-02 [Member] | |||
Right of use asset | 4,595,509 | 4,595,509 | |
Corresponding lease liability | $ 4,595,509 | $ 4,595,509 |
SCHEDULE OF NOTES PAYABLE (Deta
SCHEDULE OF NOTES PAYABLE (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 | |
Short-term Debt [Line Items] | |||
Total related party notes | $ 6,216,155 | $ 15,061,044 | |
Total notes payable | 99,100 | 273,300 | |
Notes Payable One [Member] | Related Party [Member] | |||
Short-term Debt [Line Items] | |||
Total related party notes | [1] | 4,062,713 | 7,911,044 |
Notes Payable Two [Member] | Related Party [Member] | |||
Short-term Debt [Line Items] | |||
Total related party notes | [2] | 2,077,886 | 150,000 |
Notes Payable Three [Member] | Related Party [Member] | |||
Short-term Debt [Line Items] | |||
Total related party notes | [3] | 7,000,000 | |
Notes Payable Four [Member] | Related Party [Member] | |||
Short-term Debt [Line Items] | |||
Total related party notes | [4] | 75,556 | |
Notes Payable Five [Member] | PPP Loans [Member] | |||
Short-term Debt [Line Items] | |||
Total notes payable | [5] | 273,300 | |
Notes Payable Six [Member] | SBA Loan [Member] | |||
Short-term Debt [Line Items] | |||
Total notes payable | [4] | 99,100 | |
Notes Payable [Member] | Related Party [Member] | |||
Short-term Debt [Line Items] | |||
Total notes payable | 3,042,638 | 2,698,659 | |
Notes Payable [Member] | Related Party [Member] | |||
Short-term Debt [Line Items] | |||
Total notes payable | [6] | 2,529,248 | 2,185,269 |
Notes Payable [Member] | Related Party [Member] | J N Building Loan [Member] | |||
Short-term Debt [Line Items] | |||
Total notes payable | [7] | $ 513,390 | $ 513,390 |
[1] | Payable to Quintel. As part of the agreement in the reverse merger transaction the Quintel loans and historical interest owed of $ 1,932,358 4.062 4.7 | ||
[2] | Payable to CEO, secured by XXII common stock. | ||
[3] | Convertible debt owed to XXII. On June 30, 2021 the $ 7 2.2 500,000 4.3 | ||
[4] | Liability carried over from Exactus | ||
[5] | Paycheck protection loans include Exactus’ and Panacea’s loans. | ||
[6] | Accrued expenses related to SAP software and implementation services. Software enhancements for production related functionality and user interface were added in 2020 and 2021. In 2019 the initial implementation of the system was completed. | ||
[7] | The J&N Real Estate Company loan for Panacea Building capital was made in 2020 |
SCHEDULE OF NOTES PAYABLE (De_2
SCHEDULE OF NOTES PAYABLE (Details) (Parenthetical) - USD ($) | Jun. 30, 2021 | Sep. 30, 2021 |
Historical interest | $ 1,932,358 | |
New loan principal total | 4,062,000 | |
Quintel [Member] | ||
Sale of inventory | $ 4,700,000 | |
XXII [Member] | ||
Convertible debt | $ 7,000,000 | |
XXII [Member] | Common Stock [Member] | ||
Debt conversion of convertibel debt | 500,000 | |
Needle Rock Farm [Member] | ||
Convertible debt | 2,200,000 | |
J&N Real Estate Company [Member] | ||
Company assumed loan amount | $ 4,300,000 |
NOTES PAYABLE (Details Narrativ
NOTES PAYABLE (Details Narrative) - USD ($) | Jul. 02, 2021 | Apr. 12, 2020 | Jun. 30, 2021 | Feb. 28, 2021 | Jan. 26, 2021 | May 28, 2020 | Oct. 31, 2019 | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 16, 2019 | Oct. 18, 2019 |
Short-term Debt [Line Items] | |||||||||||
Notes payable | $ 99,100 | $ 273,300 | |||||||||
Debt principal amount | 4,062,000 | ||||||||||
Employer Retention Credit [Member] | |||||||||||
Short-term Debt [Line Items] | |||||||||||
Notes payable | 190,388 | ||||||||||
Economic Injury Disaster Loan [Member] | |||||||||||
Short-term Debt [Line Items] | |||||||||||
Debt instrument, term | 30 years | ||||||||||
Proceeds from loan | $ 99,100 | ||||||||||
Debt interest rate | 3.75% | ||||||||||
Debt instrument, periodic payment | $ 483 | ||||||||||
Debt instrument, frequency of periodic payment | monthly | ||||||||||
Notes payable | 99,100 | ||||||||||
Accrued interest | 2,047 | ||||||||||
Paycheck Protection Program Funding [Member] | |||||||||||
Short-term Debt [Line Items] | |||||||||||
Proceeds from loan | $ 236,410 | ||||||||||
Paycheck Protection Program Funding [Member] | Second Draw [Member] | |||||||||||
Short-term Debt [Line Items] | |||||||||||
Proceeds from loan | $ 243,041 | ||||||||||
Quintel Note [Member] | Panacea [Member] | Quintel [Member] | |||||||||||
Short-term Debt [Line Items] | |||||||||||
Proceeds from notes payable | $ 4,062,714 | ||||||||||
Buttorff Note [Member] | Panacea [Member] | Ms. Buttorff [Member] | |||||||||||
Short-term Debt [Line Items] | |||||||||||
Debt interest rate | 10.00% | ||||||||||
Proceeds from notes payable | $ 1,685,685 | ||||||||||
Proceeds from line of credit | $ 1,000,000 | ||||||||||
Short Term Promissory Note [Member] | Officer [Member] | |||||||||||
Short-term Debt [Line Items] | |||||||||||
Debt principal amount | $ 55,556 | 55,556 | |||||||||
Debt instrument, interest rate | 18.00% | 18.00% | 12.00% | ||||||||
Original issue discount percentage | 10.00% | ||||||||||
Original issue discount amount | $ 5,556 | ||||||||||
Short Term Promissory Note [Member] | Officer [Member] | Minimum [Member] | |||||||||||
Short-term Debt [Line Items] | |||||||||||
Debt maturity date | Oct. 18, 2019 | ||||||||||
Short Term Promissory Note [Member] | Officer [Member] | Maximum [Member] | |||||||||||
Short-term Debt [Line Items] | |||||||||||
Debt maturity date | Dec. 16, 2019 | ||||||||||
Short Term Promissory Note [Member] | Stockholder [Member] | |||||||||||
Short-term Debt [Line Items] | |||||||||||
Debt interest rate | 8.00% | ||||||||||
Notes payable | 20,000 | ||||||||||
Accrued interest | $ 533 | ||||||||||
Debt principal amount | $ 20,000 |
SCHEDULE OF STOCK OPTIONS (Deta
SCHEDULE OF STOCK OPTIONS (Details) | 9 Months Ended |
Sep. 30, 2021USD ($)$ / sharesshares | |
Equity [Abstract] | |
Options Outstanding, Beginning | shares | |
Weighted Average Exercise Price Per Share Outstanding, beginning | |
Weighted Average Remaining Contractual Life Outstanding, Beginning | 0 years |
Aggregate Intrinsic Value Outstanding, Beginning | $ | |
Options assumed in merger | shares | 196,491 |
Weighted Average Exercise Price Per Share, Options assumed in merger | $ 3.64 |
Weighted Average Remaining Contractual Life Outstanding, Options assumed in merger | 3 years 8 months 12 days |
Aggregate Intrinsic Value Outstanding, Options assumed in merger | $ | $ 192,500 |
Options Granted | shares | |
Weighted Average Exercise Price Per Share, Options Granted | |
Options Exercised | shares | |
Weighted Average Exercise Price Per Share, Options Exercised | |
Options Canceled/Expired | shares | |
Weighted Average Exercise Price Per Share, Options Canceled/Expired | |
Options Outstanding, Ending | shares | 196,491 |
Weighted Average Exercise Price Per Share Outstanding, Ending | $ 3.64 |
Weighted Average Remaining Contractual Life Outstanding, Ending | 3 years 5 months 12 days |
Aggregate Intrinsic Value Outstanding, Ending | $ | $ 192,500 |
Options Vested and exercisable | shares | 196,491 |
Weighted Average Exercise Price Per Share Outstanding, Vested and exercisable | $ 3.64 |
Weighted Average Remaining Contractual Life Outstanding, Vested and Exercisable | 3 years 5 months 12 days |
Aggregate Intrinsic Value Outstanding, Vested and Exercisable | $ 192,500 |
SUMMARY OF STOCK WARRANTS (Deta
SUMMARY OF STOCK WARRANTS (Details) | 9 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Equity [Abstract] | |
Expire of warrants | |
Warrants, beginning balance | |
Warrants, Average Exercise Price. beginning balance | $ / shares | |
Warrants, assumed in merger | 56,337 |
Warrants, Average Exercise Price, assumed in merger | $ / shares | $ 13.64 |
Warrants, ending balance | 56,337 |
Warrants, Average Exercise Price, ending balance | $ / shares | $ 13.64 |
SUMMARY OF RESTRICTED STOCK (De
SUMMARY OF RESTRICTED STOCK (Details) | 9 Months Ended |
Sep. 30, 2021shares | |
Equity [Abstract] | |
Restricted Stock, Beginning balance | |
Restricted Stock, Assumed in merger | 107,993 |
Restricted Stock, Ending balance | 107,993 |
SCHEDULE OF PREFERRED STOCK (De
SCHEDULE OF PREFERRED STOCK (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Jun. 30, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Beginning balance, value | $ 11,485,155 | $ 10,575,512 | $ 6,708,299 | $ 6,708,299 | $ 11,940,129 |
Shares issued for acquisition | 4,378,992 | ||||
Ending balance, value | 8,395,399 | 6,795,797 | 11,485,155 | $ 8,395,399 | 6,795,797 |
Convertible Preferred Stock Series A Shares [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Shares issued for acquisition, shares | 450 | ||||
Preferred stock converted to common shares, shares | (100) | ||||
Preferred Stock Series B-1 Shares [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Shares issued for acquisition, shares | 1,500,000 | ||||
Preferred Stock Series B-2 Shares [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Shares issued for acquisition, shares | 6,000,000 | ||||
Preferred Stock Series C Shares [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Shares issued for acquisition, shares | |||||
Preferred Stock Series C-1 Shares [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Shares issued for acquisition, shares | |||||
Preferred Stock Series D Shares [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Shares issued for acquisition, shares | |||||
Convertible Preferred Stock Series A Shares [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Beginning balance, value | |||||
Beginning balance, shares | 450 | ||||
Shares issued for acquisition | |||||
Series A Preferred stock converted to common shares | |||||
Preferred stock converted to common shares, shares | (100) | ||||
Ending balance, value | |||||
Ending balance, shares | 350 | 450 | 350 | ||
Preferred Stock Series B-1 Shares [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Beginning balance, value | $ 150 | ||||
Beginning balance, shares | 1,500,000 | ||||
Shares issued for acquisition | $ 150 | ||||
Series A Preferred stock converted to common shares | |||||
Ending balance, value | $ 150 | $ 150 | $ 150 | ||
Ending balance, shares | 1,500,000 | 1,500,000 | 1,500,000 | ||
Preferred Stock Series B-2 Shares [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Beginning balance, value | $ 600 | ||||
Beginning balance, shares | 6,000,000 | ||||
Shares issued for acquisition | $ 600 | ||||
Series A Preferred stock converted to common shares | |||||
Ending balance, value | $ 600 | $ 600 | $ 600 | ||
Ending balance, shares | 6,000,000 | 6,000,000 | 6,000,000 | ||
Preferred Stock Series C Shares [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Beginning balance, value | $ 100 | $ 100 | $ 100 | $ 100 | $ 100 |
Beginning balance, shares | 1,000,000 | 1,000,000 | 1,000,000 | 1,000,000 | 1,000,000 |
Shares issued for acquisition | |||||
Series A Preferred stock converted to common shares | |||||
Ending balance, value | $ 100 | $ 100 | $ 100 | $ 100 | $ 100 |
Ending balance, shares | 1,000,000 | 1,000,000 | 1,000,000 | 1,000,000 | 1,000,000 |
Preferred Stock Series C-1 Shares [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Beginning balance, value | $ 1 | $ 1 | $ 1 | $ 1 | $ 1 |
Beginning balance, shares | 10,000 | 10,000 | 10,000 | 10,000 | 10,000 |
Shares issued for acquisition | |||||
Series A Preferred stock converted to common shares | |||||
Ending balance, value | $ 1 | $ 1 | $ 1 | $ 1 | $ 1 |
Ending balance, shares | 10,000 | 10,000 | 10,000 | 10,000 | 10,000 |
Preferred Stock Series D Shares [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Beginning balance, value | $ 1 | $ 1 | $ 1 | $ 1 | $ 1 |
Beginning balance, shares | 10,000 | 10,000 | 10,000 | 10,000 | 10,000 |
Shares issued for acquisition | |||||
Series A Preferred stock converted to common shares | |||||
Ending balance, value | $ 1 | $ 1 | $ 1 | $ 1 | $ 1 |
Ending balance, shares | 10,000 | 10,000 | 10,000 | 10,000 | 10,000 |
Preferred Stock [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Beginning balance, value | $ 852 | $ 102 | $ 102 | $ 102 | $ 102 |
Beginning balance, shares | 8,520,450 | 1,020,000 | 1,020,000 | 1,020,000 | 1,020,000 |
Shares issued for acquisition | $ 750 | ||||
Shares issued for acquisition, shares | 7,500,450 | ||||
Series A Preferred stock converted to common shares | |||||
Ending balance, value | $ 852 | $ 102 | $ 852 | $ 852 | $ 102 |
Ending balance, shares | 8,520,350 | 1,020,000 | 8,520,450 | 8,520,350 | 1,020,000 |
Preferred Stock [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Beginning balance, shares | 8,520,450 | 1,020,000 | 1,020,000 | 1,020,000 | 1,020,000 |
Shares issued for acquisition, shares | 7,500,000 | ||||
Preferred stock converted to common shares, shares | (100) | (100) | |||
Ending balance, shares | 8,520,350 | 1,020,000 | 8,520,450 | 8,520,350 | 1,020,000 |
STOCKHOLDERS_ EQUITY (Details N
STOCKHOLDERS’ EQUITY (Details Narrative) - USD ($) | Oct. 25, 2021 | Jun. 30, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Sep. 30, 2021 | Dec. 31, 2020 |
Class of Stock [Line Items] | ||||||
Common stock, authorized | 650,000,000 | 650,000,000 | 650,000,000 | |||
Common stock, par value per share | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||
Conversion of stocks | 100 | 100 | ||||
Shares convented into common stock | 71,429 | |||||
Preferred stock, shares authorized | 50,000,000 | 50,000,000 | ||||
Preferred stock, par value per share | $ 0.0001 | $ 0.0001 | ||||
Debt Instrument, Face Amount | $ 4,062,000 | $ 4,062,000 | ||||
Exchange Agreement [Member] | Investor [Member] | ||||||
Class of Stock [Line Items] | ||||||
Debt Instrument, Face Amount | $ 750,000 | $ 750,000 | ||||
Debt Conversion, Converted Instrument, Shares Issued | 500 | |||||
Common Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Shares convented into common stock | 71,429 | 71,429 | ||||
Stock Issued During Period, Shares, Acquisitions | 4,405,907 | |||||
0% Series A Convertible Preferred Stock [Member] | Exchange Agreement [Member] | Investor [Member] | ||||||
Class of Stock [Line Items] | ||||||
Preferred Stock, Dividend Rate, Percentage | 0.00% | |||||
Shares Issued, Price Per Share | $ 1,000 | $ 1,000 | ||||
Series A Preferred Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Preferred stock, shares authorized | 1,000 | 1,000 | 1,000 | |||
Preferred stock, par value per share | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||
Preferred stock rate | $ 0.05 | $ 0.05 | ||||
Prefered stock issued | 1,000 | 1,000 | ||||
Preferred stock, redemption terms | The Series A Preferred can be redeemed at the Company’s option upon payment of a redemption premium between 120% to 135% of the Stated Value of the outstanding Series A Preferred redeemed. | |||||
Series A Preferred Stock [Member] | Investor [Member] | ||||||
Class of Stock [Line Items] | ||||||
Shares converted | 100 | |||||
Common Stock [Member] | Investor [Member] | ||||||
Class of Stock [Line Items] | ||||||
Shares issued | 2,000,000 | |||||
Preferred Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Preferred stock, description | The Company is prohibited from effecting the conversion of the Series A Preferred to the extent that, as a result of such conversion, the holder beneficially owns more than 4.99% (which may be increased to 9.99% upon 61 days’ written notice to the Company), in the aggregate, of the issued and outstanding shares of the common stock calculated immediately after giving effect to the issuance of shares of common stock upon the conversion of the Series A Preferred. | |||||
Principal Shareholder And Chief Executive Officer [Member] | Series C Convertible Preferred Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Stock Issued During Period, Shares, Acquisitions | 1,000,000 | |||||
Preferred Stock, Liquidation Preference Per Share | $ 6.046 | $ 6.046 | ||||
Preferred stock rate | 2.289 | $ 2.289 | ||||
Principal Shareholder And Chief Executive Officer [Member] | Series C-1 Convertible Preferred Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Stock Issued During Period, Shares, Acquisitions | 10,000 | |||||
Preferred Stock, Liquidation Preference Per Share | 281.25 | $ 281.25 | ||||
Preferred stock rate | 106.49 | $ 106.49 | ||||
Principal Shareholder And Chief Executive Officer [Member] | Series D Convertible Preferred Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Stock Issued During Period, Shares, Acquisitions | 10,000 | |||||
Preferred stock conversion, percentage | 17.80% | |||||
Principal Shareholder And Chief Executive Officer [Member] | Series D Convertible Preferred Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Preferred Stock, Liquidation Preference Per Share | 430 | $ 430 | ||||
Preferred stock rate | $ 162.813 | $ 162.813 | ||||
Principal Shareholder And Chief Executive Officer [Member] | Series C Two Convertible Preferred Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Conversion of stocks | 100 | |||||
Conversion of stock, description | The Series C-2’s only rights are to convert into 2,050,000 shares of common stock on or after November 1, 2022 and to vote on an as-converted basis. The effect of this exchange was to increase the percentage of public float compared to outstanding common stock. | |||||
Principal Shareholder And Chief Executive Officer [Member] | Series C Two Convertible Preferred Stock [Member] | Common Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Conversion of stocks | 2,050,000 | |||||
Stock Warrants [Member] | ||||||
Class of Stock [Line Items] | ||||||
Number of warrant to purchase of shares of common stock | 56,377 | 56,377 | ||||
Number of shares pre-split | 1,578,549 | 1,578,549 | ||||
Warrant intrinsic value | $ 0 | $ 0 | ||||
2021 Plan [Member] | ||||||
Class of Stock [Line Items] | ||||||
New issuance of shares | 339,522 | |||||
Number of shares authorized under plan | 144,621 | 144,621 | ||||
Number of years shares available for grant | 10 years | 10 years | ||||
2018 Plan [Member] | ||||||
Class of Stock [Line Items] | ||||||
Number of shares authorized under plan | 339,285 | 339,285 | ||||
Number of years shares available for grant | 10 years | 10 years | ||||
Options vested | 196,491 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended |
Feb. 16, 2021 | Sep. 30, 2021 | |
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | CBD Products [Member] | ||
Product Liability Contingency [Line Items] | ||
Concentration risk, percentage | 29.00% | |
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Three Customers [Member] | ||
Product Liability Contingency [Line Items] | ||
Concentration risk, percentage | 61.00% | |
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Largest Customer [Member] | ||
Product Liability Contingency [Line Items] | ||
Concentration risk, percentage | 36.00% | |
Panacea [Member] | Henley Group Inc [Member] | ||
Product Liability Contingency [Line Items] | ||
Damages sought value | $ 45,000 |
SCHEDULE OF RELATED PARTY TRANS
SCHEDULE OF RELATED PARTY TRANSACTIONS LOANS (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Related Party Loan Quintel [Member] | |||||
Related Party Transaction [Line Items] | |||||
Accrued Interest Related party loan | $ 123,104 | $ 123,104 | $ 1,347,356 | ||
Interest Expense Related party loan | 123,104 | $ 257,234 | 645,628 | $ 643,171 | |
Related Party Loan C E O Loan [Member] | |||||
Related Party Transaction [Line Items] | |||||
Accrued Interest Related party loan | 42,494 | 42,494 | 1,500 | ||
Interest Expense Related party loan | 42,494 | 102,679 | |||
Related Party Loan X X I I [Member] | |||||
Related Party Transaction [Line Items] | |||||
Accrued Interest Related party loan | |||||
Interest Expense Related party loan | 175,000 | 525,000 | |||
Related Party Loan Line Of Credit [Member] | |||||
Related Party Transaction [Line Items] | |||||
Accrued Interest Related party loan | 9,129 | 9,129 | |||
Interest Expense Related party loan | $ 9,129 | $ 9,129 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | Aug. 25, 2021 | Aug. 05, 2021 | Aug. 31, 2021 | Jun. 30, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Jul. 02, 2021 | Dec. 31, 2020 | Oct. 31, 2019 |
Related Party Transaction [Line Items] | |||||||||
Notes payable related parties | $ 6,216,155 | $ 15,061,044 | |||||||
Proceeds from Related Party Debt | 2,001,201 | $ 5,134,225 | |||||||
Related Party Deposit Liabilities | 2,529,248 | ||||||||
Capitalized | 229,497 | ||||||||
Related party expenses | $ 91,482 | ||||||||
XXII Common Stock [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Shares, Outstanding | 1,227,017 | ||||||||
Sale of Stock, Number of Shares Issued in Transaction | 70,000 | 70,000 | |||||||
Sale of Stock, Consideration Received on Transaction | $ 230,296 | $ 230,296 | |||||||
Ms. Buttorff [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Debt instrument, interest rate, stated percentage | 1000.00% | ||||||||
Proceeds from Related Party Debt | $ 1,624,000 | ||||||||
Line of credit, maximum borrowing capacity | $ 1,000,000 | ||||||||
Line of credit | $ 392,201 | ||||||||
Officer [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Short term loans notes payable | $ 55,556 | ||||||||
Quintel Note [Member] | Quintel-MC Incorporated [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Notes payable related parties | $ 4,062,713 |
SCHEDULE OF EFFECTS OF RESTATEM
SCHEDULE OF EFFECTS OF RESTATEMENT (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Jun. 30, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
CURRENT ASSETS: | ||||||
Cash and cash equivalents | $ 14,500 | $ 14,500 | $ 84,379 | |||
Accounts receivable, net | 515,095 | 515,095 | 147,302 | |||
Other receivables, related party | 500,000 | 500,000 | ||||
Inventory, net | 4,344,378 | 4,344,378 | 8,409,734 | |||
Marketable securities related party | 3,631,970 | 3,631,970 | 2,853,437 | |||
Prepaid expenses and other current assets | 193,596 | 193,596 | 27,375 | |||
TOTAL CURRENT ASSETS | 9,199,539 | 9,199,539 | 11,522,227 | |||
Operating lease right-of-use asset, net, related party | 3,681,682 | 3,681,682 | 3,937,706 | |||
Property and equipment, net | 9,024,505 | 9,024,505 | 13,590,286 | |||
Intangible assets, net | 76,751 | 76,751 | 122,801 | |||
Goodwill | 2,188,810 | 2,188,810 | 2,188,810 | |||
TOTAL ASSETS | 24,171,287 | 24,171,287 | 31,361,830 | |||
CURRENT LIABILITIES: | ||||||
Accounts payable and accrued expenses | 1,474,681 | 1,474,681 | 1,765,267 | |||
Operating lease liability, current portion, related party | 1,508,743 | 1,508,743 | 1,162,869 | |||
Note payable-current, related party | 6,216,155 | 6,216,155 | 15,061,044 | |||
Paycheck protection loan, SBA Loan | 99,100 | 99,100 | 273,300 | |||
TOTAL CURRENT LIABILITIES: | 9,298,679 | 9,298,679 | 18,262,480 | |||
Operating lease liability, long-term portion, related party | 3,434,571 | 3,434,571 | 3,692,392 | |||
Other long-term liabilities, related party | 3,042,638 | 3,042,638 | 2,698,659 | |||
TOTAL LIABILITIES | 15,775,888 | 15,775,888 | 24,653,531 | |||
Commitments and contingencies | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | ||||
Preferred Stock, Shares Authorized | 50,000,000 | 50,000,000 | ||||
Common Stock: $0.0001 Par Value, 650,000,000 shares authorized; 21,393,041 and 16,915,706 shares issued and outstanding on September 30, 2021 and December 31, 2020 respectively. | $ 2,139 | $ 2,139 | $ 1,692 | |||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||
Common Stock, Shares Authorized | 650,000,000 | 650,000,000 | 650,000,000 | |||
Common Stock, Shares, Issued | 21,393,041 | 21,393,041 | 16,915,706 | |||
Common Stock, Shares, Outstanding | 21,393,041 | 21,393,041 | 16,915,706 | |||
Additional paid in capital | $ 23,066,914 | $ 23,066,914 | $ 18,689,119 | |||
Accumulated deficit | (14,674,506) | (14,674,506) | (11,982,614) | |||
TOTAL STOCKHOLDERS’ EQUITY | 8,395,399 | $ 6,795,797 | $ 11,485,155 | 8,395,399 | $ 6,795,797 | 6,708,299 |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | 24,171,287 | 24,171,287 | 31,361,830 | |||
REVENUE | 588,040 | 1,343,641 | 1,413,674 | 8,305,630 | ||
COST OF SALES | 305,025 | 2,905,780 | 883,508 | 6,285,879 | ||
GROSS PROFIT (LOSS) | 283,015 | (1,562,139) | 530,166 | 2,019,751 | ||
OPERATING EXPENSES | ||||||
Production related operating expenses | 1,250,434 | 1,307,169 | 3,407,407 | 3,012,485 | ||
General and administrative expenses | 290,638 | 478,992 | 911,906 | 2,547,438 | ||
TOTAL OPERATING EXPENSES | 1,541,072 | 1,786,161 | 4,319,313 | 5,559,923 | ||
LOSS FROM OPERATIONS | (1,258,057) | (3,348,300) | (3,789,147) | (3,540,172) | ||
OTHER INCOME (EXPENSES) | ||||||
Interest expense | (174,727) | (432,922) | (781,671) | (1,181,165) | ||
Unrealized gain (loss) on marketable securities, net | (2,303,218) | (160,310) | 848,533 | (595,590) | ||
Realized gain on sale of securities | 160,296 | 160,296 | ||||
Other income (loss) | 56,619 | (21,090) | ||||
Employer retention credit | 190,338 | 190,338 | ||||
Rental Income | 58,410 | 56,577 | 221,328 | 212,778 | ||
Gain (loss) on sale of assets | 48,621 | (297,351) | (19,093) | (140,714) | ||
Gain on extinguishment of debt | 237,202 | 755,782 | ||||
TOTAL OTHER INCOME (EXPENSE) | (1,831,699) | (431,415) | 1,097,255 | (1,604,160) | ||
LOSS BEFORE INCOME TAXES | (3,089,756) | (3,779,715) | (2,691,892) | (5,144,332) | ||
TAXES | ||||||
NET LOSS | $ (3,089,756) | $ (3,779,715) | $ (2,691,892) | $ (5,144,332) | ||
BASIC NET INCOME (LOSS) PER SHARE | $ (0.14) | $ (0.22) | $ (0.15) | $ (0.30) | ||
DILUTED NET INCOME (LOSS) PER SHARE | $ (0.14) | $ (0.22) | $ (0.15) | $ (0.30) | ||
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING | ||||||
Basic | 21,389,041 | 16,915,706 | 18,422,459 | 16,915,706 | ||
Diluted | 21,389,041 | 16,915,706 | 18,422,459 | 16,915,706 | ||
Beginning balance, value | $ 11,485,155 | $ 10,575,512 | 6,708,299 | $ 6,708,299 | $ 11,940,129 | 11,940,129 |
Shares issued for acquisition | 4,378,992 | |||||
Series A Preferred stock conversion to common stock | ||||||
Series A Preferred stock conversion to common stock, shares | 71,429 | |||||
Net income (loss) | (3,089,756) | (3,779,715) | $ (2,691,892) | (5,144,332) | ||
Ending balance, value | 8,395,399 | 6,795,797 | 11,485,155 | 8,395,399 | 6,795,797 | 6,708,299 |
Adjustments to reconcile net income (loss) to net cash used in operating activities | ||||||
Depreciation | 392,485 | 371,314 | 1,280,324 | 1,018,567 | ||
Realized gain on sale of securities | (160,296) | (160,296) | ||||
Fixed asset disposal loss | 297,351 | 19,093 | ||||
Amortization of right of use asset | ||||||
Amortization of intangible assets | 46,050 | 46,050 | ||||
Non cash settlement of convertible note and accrued interest | (752,751) | |||||
Unrealized gain/loss on marketable securities | (848,533) | 595,590 | ||||
Changes in operating assets and liabilities | ||||||
Accounts receivable | (367,793) | 91,952 | ||||
Inventory | (628,011) | (5,463,820) | ||||
Prepaid expense and other assets | (166,221) | 647,257 | ||||
Accounts payable and accrued expenses | 955,493 | 1,226,146 | ||||
Operating lease liability, net | 344,076 | 344,085 | ||||
Net cash used in operating activities | (2,692,203) | (6,619,412) | ||||
Cash flows from investing activities | ||||||
Net cash received in from acquisitions | 9,157 | |||||
Proceeds from sale of marketable securities | 230,296 | |||||
Proceeds from sale of fixed assets | 446,026 | 34,920 | ||||
Net fixed asset acquisition | (172,397) | (3,301,527) | ||||
Net Cash provided by (used in) investing activities | 513,082 | (3,266,607) | ||||
Cash flows from financing activities | ||||||
Proceeds from payroll protection loan, SBA loan | 273,300 | |||||
Proceeds from payroll protection loan - related party | 243,041 | |||||
Payments of principal on notes payable - related party | (135,000) | (3,503,545) | ||||
Proceeds from notes payable - related party | 2,001,201 | 5,134,225 | ||||
Net cash provided by financing activities | 2,109,242 | 1,903,980 | ||||
Net decrease in Cash and Cash Equivalents | (69,879) | (7,982,039) | ||||
Cash and Cash Equivalents, Beginning of Period | 84,379 | 84,379 | 8,515,509 | 8,515,509 | ||
Cash and Cash Equivalents, End of Period | 14,500 | 533,470 | 14,500 | 533,470 | 84,379 | |
Supplemental Disclosure of Cash Flow Information | ||||||
Cash paid for income taxes during the year | ||||||
Interest payments during the year | 525,000 | |||||
Noncash investing and financing activity | ||||||
Non-Cash Receivable - related party | (500,000) | |||||
Related party loan repayment with inventory | 4,693,367 | |||||
Noncash fixed asset disposal as part of the reverse acquisition | 3,058,457 | |||||
Capitalized assets purchased on account - related party | 343,979 | 396,270 | ||||
Liabilities from acquisition | 1,096,782 | |||||
Debt retired in merger, related party | (12,718,441) | |||||
Preferred Series B-1 Issuance in Acquisition | 150 | |||||
Preferred Series B-2 Issuance in Acquisition | 600 | |||||
Common stock issued for the reverse merger with Exactus | 4,369,085 | |||||
Preferred Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
TOTAL STOCKHOLDERS’ EQUITY | 852 | 102 | 852 | 852 | 102 | 102 |
OTHER INCOME (EXPENSES) | ||||||
NET LOSS | ||||||
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING | ||||||
Beginning balance, value | $ 852 | $ 102 | $ 102 | $ 102 | $ 102 | $ 102 |
Beginning balance, shares | 8,520,450 | 1,020,000 | 1,020,000 | 1,020,000 | 1,020,000 | 1,020,000 |
Shares issued for acquisition | $ 750 | |||||
Shares issued for acquisition, shares | 7,500,450 | |||||
Series A Preferred stock conversion to common stock | ||||||
Series A Preferred stock conversion to common stock, shares | (100) | (100) | ||||
Net income (loss) | ||||||
Ending balance, value | $ 852 | $ 102 | $ 852 | $ 852 | $ 102 | $ 102 |
Ending balance, shares | 8,520,350 | 1,020,000 | 8,520,450 | 8,520,350 | 1,020,000 | 1,020,000 |
Common Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
TOTAL STOCKHOLDERS’ EQUITY | $ 2,139 | $ 1,692 | $ 2,132 | $ 2,139 | $ 1,692 | $ 1,692 |
OTHER INCOME (EXPENSES) | ||||||
NET LOSS | ||||||
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING | ||||||
Beginning balance, value | $ 2,132 | $ 1,692 | $ 1,692 | $ 1,692 | $ 1,692 | $ 1,692 |
Beginning balance, shares | 21,321,613 | 16,915,706 | 16,915,706 | 16,915,706 | 16,915,706 | 16,915,706 |
Shares issued for acquisition | $ 440 | |||||
Shares issued for acquisition, shares | 4,405,907 | |||||
Series A Preferred stock conversion to common stock | $ 7 | $ 7 | ||||
Series A Preferred stock conversion to common stock, shares | 71,429 | 71,429 | ||||
Net income (loss) | ||||||
Ending balance, value | $ 2,139 | $ 1,692 | $ 2,132 | $ 2,139 | $ 1,692 | $ 1,692 |
Ending balance, shares | 21,393,042 | 16,915,706 | 21,321,613 | 21,393,042 | 16,915,706 | 16,915,706 |
Additional Paid-in Capital [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
TOTAL STOCKHOLDERS’ EQUITY | $ 23,066,914 | $ 18,689,119 | $ 23,066,921 | $ 23,066,914 | $ 18,689,119 | $ 18,689,119 |
OTHER INCOME (EXPENSES) | ||||||
NET LOSS | ||||||
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING | ||||||
Beginning balance, value | 23,066,921 | 18,689,119 | 18,689,119 | 18,689,119 | 18,689,119 | 18,689,119 |
Shares issued for acquisition | 4,377,802 | |||||
Series A Preferred stock conversion to common stock | (7) | (7) | ||||
Net income (loss) | ||||||
Ending balance, value | 23,066,914 | 18,689,119 | 23,066,921 | 23,066,914 | 18,689,119 | 18,689,119 |
Retained Earnings [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
TOTAL STOCKHOLDERS’ EQUITY | (14,674,506) | (11,895,116) | (11,584,750) | (14,674,506) | (11,895,116) | (11,982,614) |
OTHER INCOME (EXPENSES) | ||||||
NET LOSS | (3,089,756) | (3,779,715) | (2,691,892) | (5,144,332) | ||
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING | ||||||
Beginning balance, value | (11,584,750) | (8,115,401) | (11,982,614) | (11,982,614) | (6,750,784) | (6,750,784) |
Net income (loss) | (3,089,756) | (3,779,715) | (2,691,892) | (5,144,332) | ||
Ending balance, value | (14,674,506) | (11,895,116) | (11,584,750) | (14,674,506) | (11,895,116) | (11,982,614) |
Series A Preferred Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Preferred stock value | ||||||
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||
Preferred Stock, Shares Authorized | 1,000 | 1,000 | 1,000 | |||
Preferred Stock, Shares Outstanding | 450 | 450 | 0 | |||
Preferred Stock, Shares Issued | 450 | 450 | 0 | |||
Series B-1 Preferred Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Preferred stock value | $ 150 | $ 150 | ||||
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||
Preferred Stock, Shares Authorized | 32,000,000 | 32,000,000 | 32,000,000 | |||
Preferred Stock, Shares Outstanding | 1,500,000 | 1,500,000 | 0 | |||
Preferred Stock, Shares Issued | 1,500,000 | 1,500,000 | 0 | |||
Series B-2 Preferred Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Preferred stock value | $ 600 | $ 600 | ||||
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||
Preferred Stock, Shares Authorized | 6,000,000 | 6,000,000 | 6,000,000 | |||
Preferred Stock, Shares Outstanding | 6,000,000 | 6,000,000 | 0 | |||
Preferred Stock, Shares Issued | 6,000,000 | 6,000,000 | 0 | |||
Series C Preferred Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Preferred stock value | $ 100 | $ 100 | $ 100 | |||
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||
Preferred Stock, Shares Authorized | 1,000,000 | 1,000,000 | 1,000,000 | |||
Preferred Stock, Shares Outstanding | 1,000,000 | 1,000,000 | 1,000,000 | |||
Preferred Stock, Shares Issued | 1,000,000 | 1,000,000 | 1,000,000 | |||
Preferred Stock Series C 1 [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Preferred stock value | $ 1 | $ 1 | $ 1 | |||
Series C-1 Preferred Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||
Preferred Stock, Shares Authorized | 10,000 | 10,000 | 10,000 | |||
Preferred Stock, Shares Outstanding | 10,000 | 10,000 | 10,000 | |||
Preferred Stock, Shares Issued | 10,000 | 10,000 | 10,000 | |||
Series D Preferred Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Preferred stock value | $ 1 | $ 1 | $ 1 | |||
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||
Preferred Stock, Shares Authorized | 10,000 | 10,000 | 10,000 | |||
Preferred Stock, Shares Outstanding | 10,000 | 10,000 | 10,000 | |||
Preferred Stock, Shares Issued | 10,000 | 10,000 | 10,000 | |||
Revision of Prior Period, Adjustment [Member] | ||||||
CURRENT ASSETS: | ||||||
Cash and cash equivalents | ||||||
Accounts receivable, net | ||||||
Other receivables, related party | ||||||
Inventory, net | ||||||
Marketable securities related party | ||||||
Prepaid expenses and other current assets | ||||||
TOTAL CURRENT ASSETS | ||||||
Operating lease right-of-use asset, net, related party | 57,237 | 57,237 | ||||
Property and equipment, net | 14,600 | |||||
Intangible assets, net | ||||||
Goodwill | ||||||
TOTAL ASSETS | 57,237 | 57,237 | 14,600 | |||
CURRENT LIABILITIES: | ||||||
Accounts payable and accrued expenses | ||||||
Operating lease liability, current portion, related party | (3,453,787) | (3,453,787) | (3,692,381) | |||
Note payable-current, related party | ||||||
Paycheck protection loan, SBA Loan | ||||||
TOTAL CURRENT LIABILITIES: | (3,453,787) | (3,453,787) | (3,692,381) | |||
Operating lease liability, long-term portion, related party | 3,434,571 | 3,434,571 | 3,692,392 | |||
Other long-term liabilities, related party | ||||||
TOTAL LIABILITIES | (19,216) | (19,216) | 11 | |||
Commitments and contingencies | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Common Stock: $0.0001 Par Value, 650,000,000 shares authorized; 21,393,041 and 16,915,706 shares issued and outstanding on September 30, 2021 and December 31, 2020 respectively. | ||||||
Additional paid in capital | (14,588) | (14,588) | 0 | |||
Accumulated deficit | 91,041 | 91,041 | 14,589 | |||
TOTAL STOCKHOLDERS’ EQUITY | 76,453 | 226,705 | (9) | 76,453 | 226,705 | 14,589 |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | 57,237 | 57,237 | 14,600 | |||
REVENUE | ||||||
COST OF SALES | ||||||
GROSS PROFIT (LOSS) | ||||||
OPERATING EXPENSES | ||||||
Production related operating expenses | (76,462) | 5 | (76,452) | 10 | ||
General and administrative expenses | (4,205) | (4,205) | ||||
TOTAL OPERATING EXPENSES | (76,462) | (4,200) | (76,452) | (4,195) | ||
LOSS FROM OPERATIONS | 76,462 | 4,200 | 76,452 | 4,195 | ||
OTHER INCOME (EXPENSES) | ||||||
Interest expense | ||||||
Unrealized gain (loss) on marketable securities, net | (60,818) | 16,891 | ||||
Realized gain on sale of securities | ||||||
Other income (loss) | 56,619 | (21,090) | ||||
Employer retention credit | ||||||
Rental Income | ||||||
Gain (loss) on sale of assets | ||||||
Gain on extinguishment of debt | ||||||
TOTAL OTHER INCOME (EXPENSE) | (4,199) | (4,199) | ||||
LOSS BEFORE INCOME TAXES | 76,462 | 1 | 76,452 | (4) | ||
TAXES | ||||||
NET LOSS | $ 76,462 | $ 1 | $ 76,452 | $ (4) | ||
BASIC NET INCOME (LOSS) PER SHARE | $ 0 | $ 0 | $ (0.02) | $ 0 | ||
DILUTED NET INCOME (LOSS) PER SHARE | $ 0 | $ 0 | $ (0.02) | $ 0 | ||
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING | ||||||
Basic | (2,966,582) | |||||
Diluted | (2,966,582) | |||||
Beginning balance, value | $ (9) | $ 226,705 | 14,589 | $ 14,589 | $ 226,710 | 226,710 |
Shares issued for acquisition | (14,588) | |||||
Series A Preferred stock conversion to common stock | ||||||
Net income (loss) | 76,462 | 76,452 | (5) | |||
Ending balance, value | 76,453 | 226,705 | (9) | 76,453 | 226,705 | 14,589 |
Adjustments to reconcile net income (loss) to net cash used in operating activities | ||||||
Depreciation | (626,635) | |||||
Realized gain on sale of securities | ||||||
Fixed asset disposal loss | ||||||
Amortization of right of use asset | (313,261) | (249,037) | ||||
Amortization of intangible assets | 1 | |||||
Non cash settlement of convertible note and accrued interest | (99,100) | |||||
Unrealized gain/loss on marketable securities | ||||||
Changes in operating assets and liabilities | ||||||
Accounts receivable | ||||||
Inventory | (2,132,450) | |||||
Prepaid expense and other assets | ||||||
Accounts payable and accrued expenses | 1,931,562 | |||||
Operating lease liability, net | 236,796 | 249,043 | ||||
Net cash used in operating activities | (300,000) | (626,634) | ||||
Cash flows from investing activities | ||||||
Net cash received in from acquisitions | ||||||
Proceeds from sale of marketable securities | ||||||
Proceeds from sale of fixed assets | 446,026 | 34,920 | ||||
Net fixed asset acquisition | (446,026) | 474,594 | ||||
Net Cash provided by (used in) investing activities | 1 | 509,514 | ||||
Cash flows from financing activities | ||||||
Proceeds from payroll protection loan, SBA loan | ||||||
Proceeds from payroll protection loan - related party | ||||||
Payments of principal on notes payable - related party | (3,503,545) | |||||
Proceeds from notes payable - related party | 300,000 | 3,620,665 | ||||
Net cash provided by financing activities | 300,000 | 117,120 | ||||
Net decrease in Cash and Cash Equivalents | 0 | 1 | ||||
Cash and Cash Equivalents, Beginning of Period | ||||||
Cash and Cash Equivalents, End of Period | 0 | 1 | 0 | 1 | ||
Supplemental Disclosure of Cash Flow Information | ||||||
Cash paid for income taxes during the year | ||||||
Interest payments during the year | 525,000 | |||||
Noncash investing and financing activity | ||||||
Non-Cash Receivable - related party | (3,543,858) | |||||
Related party loan repayment with inventory | 12,543,540 | |||||
Noncash fixed asset disposal as part of the reverse acquisition | 1,709,357 | |||||
Capitalized assets purchased on account - related party | (341,504) | 396,270 | ||||
Liabilities from acquisition | 860,372 | |||||
Debt retired in merger, related party | (17,089,778) | |||||
Preferred Series B-1 Issuance in Acquisition | ||||||
Preferred Series B-2 Issuance in Acquisition | ||||||
Common stock issued for the reverse merger with Exactus | 4,356,748 | |||||
Revision of Prior Period, Adjustment [Member] | Additional Paid-in Capital [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
TOTAL STOCKHOLDERS’ EQUITY | (4,455) | 236,847 | (4,455) | (4,455) | 236,847 | 10,133 |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING | ||||||
Beginning balance, value | (4,455) | 236,847 | 10,133 | 10,133 | 236,847 | 236,847 |
Shares issued for acquisition | (14,588) | |||||
Series A Preferred stock conversion to common stock | ||||||
Net income (loss) | ||||||
Ending balance, value | (4,455) | 236,847 | (4,455) | (4,455) | 236,847 | 10,133 |
Revision of Prior Period, Adjustment [Member] | Retained Earnings [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
TOTAL STOCKHOLDERS’ EQUITY | 80,908 | (10,142) | 4,446 | 80,908 | (10,142) | 4,456 |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING | ||||||
Beginning balance, value | 4,446 | (10,142) | 4,456 | 4,456 | (10,137) | (10,137) |
Shares issued for acquisition | ||||||
Series A Preferred stock conversion to common stock | ||||||
Net income (loss) | 76,462 | 76,452 | (5) | |||
Ending balance, value | 80,908 | (10,142) | 4,446 | 80,908 | (10,142) | 4,456 |
Revision of Prior Period, Adjustment [Member] | Series A Preferred Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Preferred stock value | ||||||
Revision of Prior Period, Adjustment [Member] | Series B-1 Preferred Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Preferred stock value | ||||||
Revision of Prior Period, Adjustment [Member] | Series B-2 Preferred Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Preferred stock value | ||||||
Revision of Prior Period, Adjustment [Member] | Series C Preferred Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Preferred stock value | ||||||
Revision of Prior Period, Adjustment [Member] | Preferred Stock Series C 1 [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Preferred stock value | ||||||
Revision of Prior Period, Adjustment [Member] | Series D Preferred Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Preferred stock value | ||||||
Previously Reported [Member] | ||||||
CURRENT ASSETS: | ||||||
Cash and cash equivalents | 14,500 | 14,500 | 84,379 | |||
Accounts receivable, net | 515,095 | 515,095 | 147,302 | |||
Other receivables, related party | 500,000 | 500,000 | ||||
Inventory, net | 4,344,378 | 4,344,378 | 8,409,734 | |||
Marketable securities related party | 3,631,970 | 3,631,970 | 2,853,437 | |||
Prepaid expenses and other current assets | 193,596 | 193,596 | 27,375 | |||
TOTAL CURRENT ASSETS | 9,199,539 | 9,199,539 | 11,522,227 | |||
Operating lease right-of-use asset, net, related party | 3,624,445 | 3,624,445 | 3,937,706 | |||
Property and equipment, net | 9,024,505 | 9,024,505 | 13,575,687 | |||
Intangible assets, net | 76,751 | 76,751 | 122,800 | |||
Goodwill | 2,188,810 | 2,188,810 | 2,188,810 | |||
TOTAL ASSETS | 24,114,050 | 24,114,050 | 31,347,230 | |||
CURRENT LIABILITIES: | ||||||
Accounts payable and accrued expenses | 1,474,681 | 1,474,681 | 1,765,267 | |||
Operating lease liability, current portion, related party | 4,962,530 | 4,962,530 | 4,855,250 | |||
Note payable-current, related party | 6,216,155 | 6,216,155 | 15,061,044 | |||
Paycheck protection loan, SBA Loan | 99,100 | 99,100 | 273,300 | |||
TOTAL CURRENT LIABILITIES: | 12,752,466 | 12,752,466 | 21,954,861 | |||
Operating lease liability, long-term portion, related party | ||||||
Other long-term liabilities, related party | 3,042,638 | 3,042,638 | 2,698,659 | |||
TOTAL LIABILITIES | 15,795,104 | 15,795,104 | 24,653,520 | |||
Commitments and contingencies | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Common Stock: $0.0001 Par Value, 650,000,000 shares authorized; 21,393,041 and 16,915,706 shares issued and outstanding on September 30, 2021 and December 31, 2020 respectively. | 2,139 | 2,139 | 1,692 | |||
Additional paid in capital | 23,081,502 | 23,081,502 | 18,689,119 | |||
Accumulated deficit | (14,765,547) | (14,765,547) | (11,997,203) | |||
TOTAL STOCKHOLDERS’ EQUITY | 8,318,946 | 6,569,092 | 11,485,164 | 8,318,946 | 6,569,092 | 6,693,710 |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | 24,114,050 | 24,114,050 | 31,347,230 | |||
REVENUE | 588,040 | 1,343,641 | 1,413,674 | 8,305,630 | ||
COST OF SALES | 305,025 | 2,905,780 | 883,508 | 6,285,879 | ||
GROSS PROFIT (LOSS) | 283,015 | (1,562,139) | 530,166 | 2,019,751 | ||
OPERATING EXPENSES | ||||||
Production related operating expenses | 1,326,896 | 1,307,164 | 3,483,859 | 3,012,475 | ||
General and administrative expenses | 290,638 | 483,197 | 911,906 | 2,551,643 | ||
TOTAL OPERATING EXPENSES | 1,617,534 | 1,790,361 | 4,395,765 | 5,564,118 | ||
LOSS FROM OPERATIONS | (1,334,519) | (3,352,500) | (3,865,599) | (3,544,367) | ||
OTHER INCOME (EXPENSES) | ||||||
Interest expense | (174,727) | (432,922) | (781,671) | (1,181,165) | ||
Unrealized gain (loss) on marketable securities, net | (2,303,218) | (99,492) | 848,533 | (612,481) | ||
Realized gain on sale of securities | 160,296 | 160,296 | ||||
Employer retention credit | 190,338 | 190,338 | ||||
Rental Income | 58,410 | 56,577 | 221,328 | 212,778 | ||
Gain (loss) on sale of assets | 48,621 | (297,351) | (19,093) | |||
Gain on extinguishment of debt | 237,202 | 755,782 | ||||
TOTAL OTHER INCOME (EXPENSE) | (1,831,699) | (427,216) | 1,097,255 | (1,599,961) | ||
LOSS BEFORE INCOME TAXES | (3,166,218) | (3,779,716) | (2,768,344) | (5,144,328) | ||
TAXES | ||||||
NET LOSS | $ (3,166,218) | $ (3,779,716) | $ (2,768,344) | $ (5,144,328) | ||
BASIC NET INCOME (LOSS) PER SHARE | $ (0.15) | $ (0.22) | $ (0.13) | $ (0.30) | ||
DILUTED NET INCOME (LOSS) PER SHARE | $ (0.15) | $ (0.22) | $ (0.13) | $ (0.30) | ||
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING | ||||||
Basic | 21,389,041 | 16,915,706 | 21,389,041 | 16,915,706 | ||
Diluted | 21,389,041 | 16,915,706 | 21,389,041 | 16,915,706 | ||
Beginning balance, value | $ 11,485,164 | $ 10,348,807 | 6,693,710 | $ 6,693,710 | $ 11,713,419 | 11,713,419 |
Shares issued for acquisition | 4,393,580 | |||||
Series A Preferred stock conversion to common stock | ||||||
Net income (loss) | (3,166,218) | (3,779,715) | (2,768,344) | (5,144,327) | ||
Ending balance, value | 8,318,946 | 6,569,092 | 11,485,164 | 8,318,946 | 6,569,092 | 6,693,710 |
Adjustments to reconcile net income (loss) to net cash used in operating activities | ||||||
Depreciation | 1,280,324 | 1,645,202 | ||||
Realized gain on sale of securities | (160,296) | (160,296) | ||||
Fixed asset disposal loss | 297,351 | 19,093 | ||||
Amortization of right of use asset | 313,261 | 249,037 | ||||
Amortization of intangible assets | 46,049 | 46,050 | ||||
Non cash settlement of convertible note and accrued interest | (653,651) | |||||
Unrealized gain/loss on marketable securities | (848,533) | 595,590 | ||||
Changes in operating assets and liabilities | ||||||
Accounts receivable | (367,793) | 91,952 | ||||
Inventory | 1,504,439 | (5,463,820) | ||||
Prepaid expense and other assets | (166,221) | 647,257 | ||||
Accounts payable and accrued expenses | (976,069) | 1,226,146 | ||||
Operating lease liability, net | 107,280 | 95,042 | ||||
Net cash used in operating activities | (2,392,203) | (5,992,778) | ||||
Cash flows from investing activities | ||||||
Net cash received in from acquisitions | 9,157 | |||||
Proceeds from sale of marketable securities | 230,296 | |||||
Net fixed asset acquisition | 273,629 | (3,776,121) | ||||
Net Cash provided by (used in) investing activities | 513,082 | (3,776,121) | ||||
Cash flows from financing activities | ||||||
Proceeds from payroll protection loan, SBA loan | 273,300 | |||||
Proceeds from payroll protection loan - related party | 243,041 | |||||
Payments of principal on notes payable - related party | (135,000) | |||||
Proceeds from notes payable - related party | 1,701,201 | 1,513,560 | ||||
Net cash provided by financing activities | 1,809,242 | 1,786,860 | ||||
Net decrease in Cash and Cash Equivalents | (69,879) | (7,982,040) | ||||
Cash and Cash Equivalents, Beginning of Period | 84,379 | 84,379 | 8,515,509 | 8,515,509 | ||
Cash and Cash Equivalents, End of Period | 14,500 | 533,469 | 14,500 | 533,469 | 84,379 | |
Supplemental Disclosure of Cash Flow Information | ||||||
Cash paid for income taxes during the year | ||||||
Interest payments during the year | ||||||
Noncash investing and financing activity | ||||||
Non-Cash Receivable - related party | 3,043,858 | |||||
Related party loan repayment with inventory | (7,850,173) | |||||
Noncash fixed asset disposal as part of the reverse acquisition | 1,349,100 | |||||
Capitalized assets purchased on account - related party | 685,483 | |||||
Liabilities from acquisition | 236,410 | |||||
Debt retired in merger, related party | 4,371,337 | |||||
Preferred Series B-1 Issuance in Acquisition | 150 | |||||
Preferred Series B-2 Issuance in Acquisition | 600 | |||||
Common stock issued for the reverse merger with Exactus | 12,337 | |||||
Previously Reported [Member] | Preferred Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
TOTAL STOCKHOLDERS’ EQUITY | 852 | 102 | 852 | 852 | 102 | 102 |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING | ||||||
Beginning balance, value | $ 852 | $ 102 | $ 102 | $ 102 | $ 102 | $ 102 |
Beginning balance, shares | 8,520,450 | 1,020,000 | 1,020,000 | 1,020,000 | 1,020,000 | 1,020,000 |
Shares issued for acquisition | $ 750 | |||||
Shares issued for acquisition, shares | 7,500,450 | |||||
Series A Preferred stock conversion to common stock | ||||||
Series A Preferred stock conversion to common stock, shares | (100) | (100) | ||||
Net income (loss) | ||||||
Ending balance, value | $ 852 | $ 102 | $ 852 | $ 852 | $ 102 | $ 102 |
Ending balance, shares | 8,520,350 | 1,020,000 | 8,520,450 | 8,520,350 | 1,020,000 | 1,020,000 |
Previously Reported [Member] | Common Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
TOTAL STOCKHOLDERS’ EQUITY | $ 2,139 | $ 1,692 | $ 2,132 | $ 2,139 | $ 1,692 | $ 1,692 |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING | ||||||
Beginning balance, value | $ 2,132 | $ 1,692 | $ 1,692 | $ 1,692 | $ 1,692 | $ 1,692 |
Beginning balance, shares | 21,321,613 | 16,915,706 | 16,915,706 | 16,915,706 | 16,915,706 | 16,915,706 |
Shares issued for acquisition | $ 440 | |||||
Shares issued for acquisition, shares | 4,405,907 | |||||
Series A Preferred stock conversion to common stock | $ 7 | $ 7 | ||||
Series A Preferred stock conversion to common stock, shares | 71,429 | 71,429 | ||||
Net income (loss) | ||||||
Ending balance, value | $ 2,139 | $ 1,692 | $ 2,132 | $ 2,139 | $ 1,692 | $ 1,692 |
Ending balance, shares | 21,393,042 | 16,915,706 | 21,321,613 | 21,393,042 | 16,915,706 | 16,915,706 |
Previously Reported [Member] | Additional Paid-in Capital [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
TOTAL STOCKHOLDERS’ EQUITY | $ 23,071,369 | $ 18,452,272 | $ 23,071,376 | $ 23,071,369 | $ 18,452,272 | $ 18,678,986 |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING | ||||||
Beginning balance, value | 23,071,376 | 18,452,272 | 18,678,986 | 18,678,986 | 18,452,272 | 18,452,272 |
Shares issued for acquisition | 4,392,390 | |||||
Series A Preferred stock conversion to common stock | (7) | (7) | ||||
Net income (loss) | ||||||
Ending balance, value | 23,071,369 | 18,452,272 | 23,071,376 | 23,071,369 | 18,452,272 | 18,678,986 |
Previously Reported [Member] | Retained Earnings [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
TOTAL STOCKHOLDERS’ EQUITY | (14,755,414) | (11,884,974) | (11,589,196) | (14,755,414) | (11,884,974) | (11,987,070) |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING | ||||||
Beginning balance, value | (11,589,196) | (8,105,259) | (11,987,070) | (11,987,070) | (6,740,647) | (6,740,647) |
Net income (loss) | (3,166,218) | (3,779,715) | (2,768,344) | (5,144,327) | ||
Ending balance, value | (14,755,414) | $ (11,884,974) | $ (11,589,196) | (14,755,414) | $ (11,884,974) | (11,987,070) |
Previously Reported [Member] | Series A Preferred Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Preferred stock value | ||||||
Previously Reported [Member] | Series B-1 Preferred Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Preferred stock value | 150 | 150 | ||||
Previously Reported [Member] | Series B-2 Preferred Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Preferred stock value | 600 | 600 | ||||
Previously Reported [Member] | Series C Preferred Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Preferred stock value | 100 | 100 | 100 | |||
Previously Reported [Member] | Preferred Stock Series C 1 [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Preferred stock value | 1 | 1 | 1 | |||
Previously Reported [Member] | Series D Preferred Stock [Member] | ||||||
STOCKHOLDERS’ EQUITY | ||||||
Preferred stock value | $ 1 | $ 1 | $ 1 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - USD ($) | Nov. 18, 2021 | Oct. 25, 2021 | Oct. 31, 2021 | Oct. 25, 2021 | Sep. 30, 2021 | Dec. 31, 2020 |
Subsequent Event [Line Items] | ||||||
Exercise price | $ 13.64 | |||||
Subsequent Event [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Reverse stock split | 1-for-28 reverse stock split. | 1-for-28 reverse stock split | ||||
Brokerage commissions percentage | 10.00% | |||||
Legal Fees | $ 900,000 | |||||
Subsequent Event [Member] | Institutional Investor [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Debt instrument unamortized discount | 1,100,000 | |||||
Payment of gross proceeds | $ 1,000,000 | |||||
Subsequent Event [Member] | Common Stock [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Debt conversion converted instrument shares | 10,649,078 | |||||
Stock issued during period shares acquisitions | 7,321,429 | |||||
Convertible common stock | $ 1.40 | |||||
Purchase warrant shares | 785,715 | |||||
Exercise price | $ 1.40 | |||||
Subsequent Event [Member] | Series C Two Convertible Preferred Stock [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Debt conversion converted instrument shares | 7,321,429 | |||||
Stock issued during period shares acquisitions | 100 |