Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2018 | Aug. 14, 2018 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | MyDx, Inc. | |
Entity Central Index Key | 1,582,341 | |
Trading Symbol | MYDX | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q2 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 3,877,641,423 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) | Jun. 30, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash | $ 41,889 | $ 119,028 |
Inventory | 163,734 | 180,503 |
Prepaid expenses and other current assets | 4,526 | 821 |
Total current assets | 210,149 | 300,352 |
Tooling in process | 173,854 | |
Property and equipment, net | 32,838 | 66,832 |
Other assets | 23,983 | 32,580 |
Total assets | 440,824 | 399,764 |
Current liabilities: | ||
Accounts payable | 1,650,327 | 1,293,443 |
Customer deposits | 18,431 | 20,107 |
Accrued liabilities | 565,036 | 454,413 |
Current portion of leases payable | 2,756 | 2,756 |
Due to related party | 151,075 | 46,075 |
Convertible notes payable, current, net of debt discount | 265,750 | 295,750 |
Derivative liability | 1,626,216 | 2,596,005 |
Total current liabilities | 4,279,591 | 4,708,549 |
Customer deposits | 8,087 | 8,954 |
Total liabilities | 4,287,678 | 4,717,503 |
Redeemable Series B Preferred stock, $0.001 par value; 300,000 shares authorized 107,000 and 296,700 shares issued and outstanding as of June 30, 2018 and December 31, 2017, respectively | 2,033,000 | 5,637,300 |
Commitments and contingencies | ||
Stockholders' deficit: | ||
Series A Preferred stock, $0.001 par value; 51 shares authorized 51 and 51 shares issued and outstanding as of June 30, 2018 and December 31, 2017, respectively | ||
Common stock, $0.001 par value, 10,000,000,000 shares authorized; 3,849,270,211 and 1,859,397,541 shares issued and outstanding as of June 30, 2018 and December 31, 2017, respectively | 3,849,270 | 1,859,397 |
Additional paid-in capital | 21,834,253 | 19,818,536 |
Accumulated deficit | (31,563,377) | (31,632,972) |
Total stockholders' deficit | (5,879,854) | (9,955,039) |
Total liabilities and stockholders' deficit | $ 440,824 | $ 399,764 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) (Unaudited) - $ / shares | Jun. 30, 2018 | Dec. 31, 2017 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 10,000,000,000 | 10,000,000,000 |
Common stock, shares issued | 3,849,270,211 | 1,859,397,541 |
Common stock, shares outstanding | 3,849,270,211 | 1,859,397,541 |
Redeemable Series B Preferred stock | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 300,000 | 300,000 |
Preferred stock, shares issued | 107,000 | 296,700 |
Preferred stock, shares outstanding | 107,000 | 296,700 |
Series A Preferred stock | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 51 | 51 |
Preferred stock, shares issued | 51 | 51 |
Preferred stock, shares outstanding | 51 | 51 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Sales | ||||
Product revenue | $ 84,061 | $ 119,661 | $ 150,905 | $ 197,680 |
Product service revenue | 6,122 | 6,149 | 11,577 | 13,521 |
Licensing revenue | 3,641 | 7,771 | ||
Total sales | 93,824 | 125,810 | 170,253 | 211,201 |
Cost of goods sold | ||||
Product costs | 35,762 | 27,187 | 62,100 | 61,035 |
Total cost of sales | 35,762 | 27,187 | 62,100 | 61,035 |
Gross profit | 58,062 | 98,623 | 108,153 | 150,166 |
Operating Expenses | ||||
Research and development | 39,218 | 27,724 | 272,308 | 48,007 |
Sales and marketing | 58,872 | 476,347 | 111,125 | 673,393 |
General and administrative | 312,282 | 303,587 | 557,929 | 864,614 |
Total operating expenses | 410,372 | 807,658 | 941,362 | 1,586,014 |
Loss from operations | (352,310) | (709,035) | (833,209) | (1,435,848) |
Other income (expense) | ||||
Interest expense, net | (7,951) | (13,282) | (16,702) | (283,288) |
Change in fair value of derivative liability | (327,117) | 3,711,673 | 1,191,940 | 119,842 |
Derivative expense | (127,513) | (228,249) | (281,515) | (866,431) |
Gain (loss) on settlement of debt | 71,701 | 4,500 | 198,261 | |
Gain on forfeiture of technology transfer deposit | 135,000 | 135,000 | ||
Gain on extinguishment of debt | 4,581 | 4,581 | ||
Total Other income (expense) | (458,000) | 3,676,843 | 902,804 | (696,616) |
Income (loss) before provision for income taxes | (810,310) | 2,967,808 | 69,595 | (2,132,464) |
Provision for income taxes | ||||
Net income (loss) | $ (810,310) | $ 2,967,808 | $ 69,595 | $ (2,132,464) |
Income (loss) per share | ||||
Basic | $ 0 | $ 0 | $ 0 | $ 0 |
Diluted | $ 0 | $ 0 | $ 0 | $ 0 |
Weighted average common shares outstanding - basic | 3,007,985,341 | 1,574,702,974 | 2,452,630,014 | 1,348,619,233 |
Weighted average common shares outstanding - diluted | 3,007,985,341 | 5,038,598,230 | 3,999,109,821 | 1,348,619,233 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 69,595 | $ (2,132,464) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 33,994 | 40,114 |
Common stock issued in exchange for services | 245,750 | 473,800 |
Change in fair value of derivative liability | (1,191,940) | (119,842) |
Derivative expense | 281,515 | 866,431 |
Gain on settlement of accrued payroll | (44,005) | |
Gain on settlement of vendor liabilities | (4,500) | (154,255) |
Stock based compensation | 1,971 | 247,420 |
Loss on extinguishment of debt | (4,581) | |
Bad debt expense | ||
Interest expense related to amortization of debt issuance costs and debt discount | 260,420 | |
Changes in assets and liabilities: | ||
Inventory | 16,769 | (7,917) |
Prepaid expenses and other assets | 18,178 | 33,227 |
Accounts payable and accrued liabilities | 492,284 | 357,103 |
Customer deposits | 2,680 | |
Long term obligations | (10,312) | |
Current portion leases payable | (742) | |
Net cash provided by (used in) operating activities | (38,285) | (191,022) |
Cash flows from investing activity: | ||
Tooling in process | (173,854) | |
Net cash used in investing activity | (173,854) | |
Cash flows from financing activities | ||
Proceeds from the issuance of common stock | 245,500 | |
Proceeds from due to related party | 105,000 | 135,000 |
Repayment of related party loans | (20,000) | |
Proceeds from the issuance of convertible notes payable, net of issuance costs | 30,000 | |
Repayments on asset based loans | (99,429) | |
Net cash provided by financing activities | 135,000 | 261,071 |
Net change in cash | (77,139) | 70,049 |
Cash, beginning of period | 119,028 | 38,203 |
Cash, end of period | 41,889 | 108,252 |
Supplemental cash flow information: | ||
Interest paid | 12,023 | |
Taxes paid | ||
Supplemental disclosure of non-cash investing and financing activities: | ||
Settlement of debt with convertible note | 60,000 | 535,288 |
Common stock issued for settlement of vendor liabilities | 25,500 | |
Conversion of convertible debt to common stock | 114,783 | 472,223 |
Conversion of convertible preferred stock to common stock | 3,604,300 | |
Derivative cease to exist upon conversion of notes | $ 1,656,420 |
Organization
Organization | 6 Months Ended |
Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | 1. Organization MyDx, Inc. (the “Company”, “we”, “us”, “MyDx”, or “our”) (formerly known as Brista Corp.) was incorporated under the laws of the State of Nevada on December 20, 2012. The Company’s wholly owned subsidiary, CDx, Inc., was incorporated under the laws of the State of Delaware on September 16, 2013. |
Nature of Business
Nature of Business | 6 Months Ended |
Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Business | 2. Nature of Business MyDx is a science and technology company that develops and deploys products and services in the following focus areas: 1) Consumer Products 2) Data Analytics 3) Biopharmaceuticals TM TM 4) Software as a Service (SaaS) We are committed to addressing areas of critical national need to promote public safety, transparency and regulation in the various markets we serve. The Company’s first product, MyDx ® ® |
Going Concern
Going Concern | 6 Months Ended |
Jun. 30, 2018 | |
Going Concern [Abstract] | |
Going Concern | 3. Going Concern The Company has adopted ASU No. 2014-15, “Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (“ASU 2014-15”) The Company’s condensed consolidated financial statements have been prepared assuming it will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business. As reflected in the condensed consolidated Financial Statements, the Company had an accumulated deficit at June 30, 2018 and a net cash used in operating activities for the six months ended June 30, 2018. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The Company is attempting to further implement its business plan and generate sufficient revenues; however, its cash position may not be sufficient to support its daily operations. The Company has a limited operating history and its prospects are subject to risks, expenses and uncertainties frequently encountered by early-stage companies. These risks include, but are not limited to, the uncertainty of availability of financing and the uncertainty of achieving future profitability. Management anticipates that the Company will be dependent, for the near future, on investment capital to fund operating expenses. The Company intends to position itself so that it may be able to raise funds through the capital markets. There can be no assurance that such financing will be available at terms acceptable to the Company, if at all. Failure to generate sufficient cash flows from operations, raise capital or reduce certain discretionary spending could have a material adverse effect on the Company’s ability to achieve its intended business objectives. We reported negative cash flow from operations for the six months ended June 30, 2018. It is anticipated that we will continue to report negative operating cash flow in future periods, likely until one or more of our products generates sufficient revenue to cover our operating expenses. If any of the warrants are exercised, all net proceeds of the warrant exercise will be used for working capital to fund negative operating cash flow. Our cash balance of $41,889 at June 30, 2018 will not be sufficient to fund our operations for the next 12 months. Additionally, if we are unable to generate sufficient revenues to pay our expenses, we will need to raise additional funds to continue our operations. We have historically financed our operations through private equity and debt financings. We do not have any commitments for financing at this time, and financing may not be available to us on favorable terms, if at all. If we are unable to obtain debt or equity financing in amounts sufficient to fund our operations, if necessary, we will be forced to suspend or curtail our operations. In that event, current stockholders would likely experience a loss of most or all of their investment. Additional funding that we do obtain may be dilutive to the interests of existing stockholders. The condensed consolidated financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 4. Summary of Significant Accounting Policies Basis of Presentation - Unaudited Interim Financial Information The accompanying unaudited interim condensed consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information, and in accordance with the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) with respect to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited interim condensed consolidated financial statements furnished reflect all adjustments (consisting of normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of the results for the interim periods presented. Interim results are not necessarily indicative of the results for the full year. These unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto contained in the Company’s annual report on Form 10-K for the year ended December 31, 2017. Use of Estimates The preparation of the consolidated finance statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the condensed consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. Such management estimates include allowance for doubtful accounts, estimates of product returns, warranty expense, inventory valuation, valuation allowances of deferred taxes, stock-based compensation expenses and fair value of warrants and derivatives. The Company bases its estimates on historical experience and on assumptions that it believes are reasonable. The Company assesses these estimates on a regular basis; however, actual results could materially differ from those estimates. Concentration of Risk Related to Third-party Suppliers We depend on a limited number of third-party suppliers for the materials and components required to manufacture our products. A delay or interruption by our suppliers may harm our business, results of operations, and financial condition, and could also adversely affect our future profit margins. In addition, the lead time needed to establish a relationship with a new supplier can be lengthy, and we may experience delays in meeting demand in the event we must change or add new suppliers. Our dependence on our suppliers exposes us to numerous risks, including but not limited to the following: our suppliers may cease or reduce production or deliveries, raise prices, or renegotiate terms; we may be unable to locate a suitable replacement supplier on acceptable terms or on a timely basis, or at all; and delays caused by supply issues may harm our reputation, frustrate our customers, and cause them to turn to our competitors for future needs. Fair Value of Financial Instruments The Company recognizes and discloses the fair value of its assets and liabilities using a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). Each level of input has different levels of subjectivity and difficulty involved in determining fair value. Level 1 Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets at the measurable date. Level 2 Inputs, other than quoted prices included in Level 1, that are observable for the asset or liability through corroboration with market data at the measurement date. Level 3 Unobservable inputs that reflect management’s best estimate of what participants would use in pricing the asset or liability at the measurement date. The carrying amounts of the Company’s financial assets and liabilities, including cash, accounts receivable, accounts payable, and accrued liabilities approximate fair value because of the short maturity of these instruments. The carrying value of the Company’s loan payable and convertible notes payable approximates fair value based upon borrowing rates currently available to the Company for loans with similar terms. Business Segments ASC 280 defines operating segments as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performances. Currently, ASC 280 has no effect on the Company’s condensed consolidated financial statements as substantially all of the Company’s operations are conducted in one industry segment. Cash The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents. As of June 30, 2018 and December 31, 2017, the Company held no cash equivalents. The Company’s policy is to place its cash with high credit quality financial instruments and institutions and limit the amounts invested with any one financial institution or in any type of instrument. Deposits held with banks may exceed the amount of insurance provided on such deposits. The Company has not experienced any losses on its deposits of cash. Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are recorded at the invoiced amount and are not interest bearing. The Company maintains an allowance for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments. The Company makes ongoing assumptions relating to the collectability of its accounts receivable in its calculation of the allowance for doubtful accounts. In determining the amount of the allowance, the Company makes judgments about the creditworthiness of customers based on ongoing credit evaluations and assesses current economic trends affecting its customers that might impact the level of credit losses in the future and result in different rates of bad debts than previously seen. The Company also considers its historical level of credit losses. As of June 30, 2018 and December 31, 2017, there was an allowance for doubtful accounts of $27,851 and $27,851 respectively. During the six months ended June 30, 2018 the Company recorded a bad debt expense of $0. Inventory Inventory is stated at the lower of cost or market value. Inventory is determined to be salable based on demand forecast within a specific time horizon, generally eighteen months or less. Inventory in excess of salable amounts and inventory which is considered obsolete based upon changes in existing technology is written off. At the point of recognition, a new lower cost basis for that inventory is established and subsequent changes in facts and circumstances do not result in the restoration or increase in that new cost basis. Property and Equipment Property and equipment are recorded at cost, less accumulated depreciation and amortization. Depreciation and amortization are provided using the straight-line method over the useful life as follows: Internal-use software 3 years Equipment 3 to 5 years Computer equipment 3 to 7 years Furniture and fixtures 5 to 7 years Leasehold improvements Shorter of life of asset or lease Accounting for Website Development Costs The Company capitalizes certain external and internal costs, including internal payroll costs, incurred in connection with the development of its website. These costs are capitalized beginning when the Company has entered the application development stage and cease when the project is substantially complete and is ready for its intended use. The website development costs are amortized using the straight-line method over the estimated useful life of three years. Impairment of Long-Lived Assets Long-lived assets, such as property and equipment, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future undiscounted net cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized in the amount by which the carrying amount of the asset exceeds the fair value of the asset. Assets to be disposed of would be separately presented in the balance sheets and reported at the lower of the carrying amount or fair value less costs to sell, and no longer depreciated. The assets and liabilities of a disposed group classified as held for sale would be presented separately in the appropriate asset and liability sections of the balance sheets. Debt Discount and Debt Issuance Costs Debt discounts and debt issuance costs incurred in connection with the issuance of debt are capitalized and amortized to interest expense based on the related debt agreements using the straight-line method. Unamortized discounts are netted against long-term debt. Derivative Liability In accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Paragraph 815-15-25-1 the conversion feature and certain other features are considered embedded derivative instruments, such as a conversion reset provision, a penalty provision and redemption option, which are to be recorded at their fair value as its fair value can be separated from the convertible note and its conversion is independent of the underlying note value. The Company records the resulting discount on debt related to the conversion features at initial transaction and amortizes the discount using the effective interest rate method over the life of the debt instruments. The conversion liability is then marked to market each reporting period with the resulting gains or losses shown in the statements of operations. In circumstances where the embedded conversion option in a convertible instrument is required to be bifurcated and there are also other embedded derivative instruments in the convertible instrument that are required to be bifurcated, the bifurcated derivative instruments are accounted for as a single, compound derivative instrument. The Company follows ASC Section 815-40-15 (“Section 815-40-15”) to determine whether an instrument (or an embedded feature) is indexed to the Company’s own stock. Section 815-40-15 provides that an entity should use a two-step approach to evaluate whether an equity-linked financial instrument (or embedded feature) is indexed to its own stock, including evaluating the instrument’s contingent exercise and settlement provisions. The adoption of Section 815-40-15 has affected the accounting for (i) certain freestanding warrants that contain exercise price adjustment features and (ii) convertible bonds issued by foreign subsidiaries with a strike price denominated in a foreign currency. The Company evaluates its convertible debt, options, warrants or other contracts, if any, to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with paragraph 810-10-05-4 and Section 815-40-25 of the FASB Accounting Standards Codification. The result of this accounting treatment is that the fair value of the embedded derivative is marked-to-market each balance sheet date and recorded as either an asset or a liability. In the event that the fair value is recorded as a liability, the change in fair value is recorded in the consolidated statement of operations as other income or expense. Upon conversion, exercise or cancellation of a derivative instrument, the instrument is marked to fair value at the date of conversion, exercise or cancellation and then that the related fair value is reclassified to equity. The Company utilizes the binomial option pricing model to compute the fair value of the derivative and to mark to market the fair value of the derivative at each balance sheet date. The binomial option pricing model includes subjective input assumptions that can materially affect the fair value estimates. The expected volatility is estimated based on the most recent historical period of time equal to the remaining contractual term of the instrument granted. Revenue Recognition The Company adopted ASC 606 effective January 1, 2018 using the modified retrospective method which would require a cumulative effect adjustment for initially applying the new revenue standard as an adjustment to the opening balance of retained earnings and the comparative information would not require to be restated and continue to be reported under the accounting standards in effect for those periods. Based on the Company’s analysis the Company did not identify a cumulative effect adjustment for initially applying the new revenue standards. The Company principally generates revenue through providing product, services and licensing revenue. The adoption of ASC 606 represents a change in accounting principle that will more closely align revenue recognition with the delivery of the Company’s services and will provide financial statement readers with enhanced disclosures. In accordance with ASC 606, revenue is recognized when a customer obtains control of promised services. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for these services. To achieve this core principle, the Company applies the following five steps: 1) Identify the contract with a customer A contract with a customer exists when (i) the Company enters into an enforceable contract with a customer that defines each party’s rights regarding the services to be transferred and identifies the payment terms related to these services, (ii) the contract has commercial substance and, (iii) the Company determines that collection of substantially all consideration for services that are transferred is probable based on the customer’s intent and ability to pay the promised consideration. The Company applies judgment in determining the customer’s ability and intention to pay, which is based on a variety of factors including the customer’s historical payment experience or, in the case of a new customer, published credit and financial information pertaining to the customer. 2) Identify the performance obligations in the contract Performance obligations promised in a contract are identified based on the services that will be transferred to the customer that are both capable of being distinct, whereby the customer can benefit from the service either on its own or together with other resources that are readily available from third parties or from the Company, and are distinct in the context of the contract, whereby the transfer of the services is separately identifiable from other promises in the contract. To the extent a contract includes multiple promised services, the Company must apply judgment to determine whether promised services are capable of being distinct and distinct in the context of the contract. If these criteria are not met the promised services are accounted for as a combined performance obligation. 3) Determine the transaction price The transaction price is determined based on the consideration to which the Company will be entitled in exchange for transferring services to the customer. To the extent the transaction price includes variable consideration, the Company estimates the amount of variable consideration that should be included in the transaction price utilizing either the expected value method or the most likely amount method depending on the nature of the variable consideration. Variable consideration is included in the transaction price if, in the Company’s judgment, it is probable that a significant future reversal of cumulative revenue under the contract will not occur. None of the Company’s contracts as of June 30, 2018 contained a significant financing component. Determining the transaction price requires significant judgment, which is discussed by revenue category in further detail below. 4) Allocate the transaction price to performance obligations in the contract If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. However, if a series of distinct services that are substantially the same qualifies as a single performance obligation in a contract with variable consideration, the Company must determine if the variable consideration is attributable to the entire contract or to a specific part of the contract. For example, a bonus or penalty may be associated with one or more, but not all, distinct services promised in a series of distinct services that forms part of a single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price to each performance obligation based on a relative standalone selling price basis unless the transaction price is variable and meets the criteria to be allocated entirely to a performance obligation or to a distinct service that forms part of a single performance obligation. The Company determines standalone selling price based on the price at which the performance obligation is sold separately. If the standalone selling price is not observable through past transactions, the Company estimates the standalone selling price taking into account available information such as market conditions and internally approved pricing guidelines related to the performance obligations. 5) Recognize revenue when or as the Company satisfies a performance obligation The Company satisfies performance obligations either over time or at a point in time. Revenue is recognized at the time the related performance obligation is satisfied by transferring a promised service to a customer. Product revenue Revenue from multiple-element arrangements is allocated among separate elements based on their estimated sales prices, provided the elements have value on a stand-alone basis. Licensing revenue Some of the Company’s revenues are generated from software-as-a-service (“SaaS”) subscription offerings and related product support and maintenance. SaaS revenues stem mainly from annual subscriptions and are recorded evenly over the term of the subscription. Any customer payments received in advance are deferred until they are earned. Consulting and training revenues are recognized as work is performed. Product Returns For any product in its original, undamaged and unmarked condition, with its included accessories and packaging along with the original receipt (or gift receipt) within 30 days of the date the customer receives the product, the Company will exchange it or offer a refund based upon the original payment method. Customer Deposits The Company accounts for funds received from crowdfunding campaigns and pre-sales as a liability on the consolidated balance sheets as the investments made entitle the investor to apply these funds towards future shipments once the product has been developed and available for commercial use. Research and Development Costs Research and development costs are charged to expense as incurred. These costs consist primarily of salaries and direct payroll-related costs. It also includes purchased materials and services provided by independent contractors, software developed by other companies and incorporated into or used in the development of our final products. Research and development expenses for the six months ended June 30, 2018 and 2017 were $272,308 and $48,007, respectively. Advertising Costs Advertising costs are charged to sales and marketing expenses and general and administrative expenses as incurred. Advertising expenses, which are recorded in sales and marketing and general and administrative expenses, totaled $111,125 and $673,393 for the six months ended June 30, 2018 and 2017, respectively. Stock-Based Compensation The Company accounts for stock-based compensation in accordance with ASC Topic 718, “ Compensation – Stock Compensation” The Company accounts for share-based payments to non-employees in accordance with ASC 505-50 “ Equity Based Payments to Non-Employees Warranty The Company provides a limited warranty for its analyzers and sensors for a period of 1 year from the date of shipment that such goods will be free from material defects in material and workmanship. The Company has assessed the historical claims and, to date, warranty claims have not been significant. The Company will continue to assess the need to record a warranty accrual at the time of sale going forward. Collaborative Arrangements The Company and its collaborative partners are active participants in the collaborative arrangements and both parties are exposed to significant risks and rewards depending on the commercial success of the activity. The Company records all expenses related to collaborative arrangements as research and development expense in the consolidated statements of operations as incurred. Earnings per Share Earnings Per Share (“EPS”) is the amount of earnings attributable to each share of common stock. For convenience, the term is used to refer to either earnings or loss per share. EPS is computed pursuant to section 260-10-45 of the FASB Accounting Standards Codification. Pursuant to ASC Paragraphs 260-10-45-10 through 260-10-45-16 Basic EPS shall be computed by dividing income available to common stockholders (the numerator) by the weighted-average number of common shares outstanding (the denominator) during the period. The computation of diluted EPS is similar to the computation of basic EPS except that the denominator is increased to include the number of additional common shares that would have been outstanding if the dilutive potential common shares had been issued during the period to reflect the potential dilution that could occur from common shares issuable through contingent shares issuance arrangement, stock options or warrants. Pursuant to ASC Paragraphs 260-10-45-45-21 through 260-10-45-45-23 Diluted EPS shall be based on the most advantageous conversion rate or exercise price from the standpoint of the security holder. The dilutive effect of outstanding convertible preferred stock, convertible payables, call options and warrants (and their equivalents) issued by the reporting entity shall be reflected in diluted EPS by application of the treasury stock method. Under the treasury stock method: a. Exercise of options and warrants shall be assumed at the beginning of the period (or at time of issuance, if later) and common shares shall be assumed to be issued. b. The proceeds from exercise shall be assumed to be used to purchase common stock at the average market price during the period. c. The incremental shares (the difference between the number of shares assumed issued and the number of shares assumed purchased) shall be included in the denominator of the diluted EPS computation. Pursuant to ASC Paragraphs 260-10-45-40 through 45-42 convertible securities shall be reflected in diluted EPS by application of the if-converted method. The convertible preferred stock or convertible debt shall be assumed to have been converted at the beginning of the period (or at time of issuance, if later). In applying the if-converted method, conversion shall not be assumed for purposes of computing diluted EPS if the effect would be anti-dilutive. The following table provides a reconciliation of the numerator and denominator used in computing basic and diluted net income (loss) attributable to common stockholders per common share. For the Three Months Ended For the Six Months Ended June 30, June 30, June 30, June 30, 2018 2017 2018 2017 Numerator: Net income/(loss) attributable to common stockholders $ (810,310 ) $ 2,967,808 $ 69,595 $ (2,132,464 ) Effect of dilutive securities: Convertible note - Interest expense - 18,379 - - Net change in derivative liabilities - convertible payables - 4,306,970 - - Diluted net income (loss) $ (810,310 ) $ 7,293,157 $ 69,595 $ (2,132,464 ) Denominator: Weighted average common shares outstanding - basic 3,007,985,341 1,574,702,974 2,452,630,014 1,348,619,233 Dilutive securities (a): Series A Preferred stock - 51 51 - Series B Preferred stock - 3,000,000,000 1,070,000,000 - Convertible notes payable - 16,337,778 - - Convertible accounts payable - 194,785,455 379,889,803 - Options - - - - Warrants - 252,771,972 96,589,953 - Weighted average common shares outstanding and assumed conversion - diluted 3,007,985,341 5,038,598,230 3,999,109,821 1,348,619,233 Basic net income (loss) per common share $ (0.00 ) $ 0.00 $ 0.00 $ (0.00 ) Diluted net income (loss) per common share $ (0.00 ) $ 0.00 $ 0.00 $ (0.00 ) (a) - Anti-dilutive options excluded: 1,700,463,104 261,835,175 153,983,297 3,472,958,459 The Company had the following common stock equivalents at June 30, 2018 and 2017: June 30, June 30, Series A Preferred stock 51 51 Series B Preferred stock 1,070,000,000 3,000,000,000 Convertible notes payable 144,915,652 16,337,778 Convertible accounts payable 379,889,803 194,785,455 Options 1,496,250 1,490,026 Warrants 104,161,788 260,345,149 Totals 1,700,463,053 3,472,958,459 There were approximately 1,855,927,821 potentially outstanding dilutive common shares for the period ended June 30, 2018. Since the Company incurred a net loss for the period ended June 30, 2017, the inclusion of any common stock equivalents would have been anti-dilutive. Recent Accounting Guidance Adopted In April 2016, the FASB issued ASU No. 2016-10, “ Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross verses Net)” In May 2016, the FASB issued ASU No. 2016-12, “Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients”, which narrowly amended the revenue recognition guidance regarding collectability, noncash consideration, presentation of sales tax and transition and is effective during the same period as ASU 2014-09. The adoption of ASU 2016-12 had no material effect on its financial position or results of operations or cash flows. Management does not believe that any recently issued, but not yet effective accounting pronouncements, when adopted, will have a material effect on the accompanying condensed consolidated financial statements. |
Inventory
Inventory | 6 Months Ended |
Jun. 30, 2018 | |
Inventory Disclosure [Abstract] | |
Inventory | 5. Inventory Inventory as of June 30, 2018 and December 31, 2017 is as follows: June 30, December 31, 2018 2017 Finished goods $ 14,992 $ 49,889 Raw materials 148,742 130,614 $ 163,734 $ 180,503 |
Debt
Debt | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Debt | 6. Debt Convertible Notes The following table shows the outstanding balance as of June 30, 2018 and December 31, 2017 respectively. June 30, December 31, 2018 2017 Convertible Note - February 6, 2017 265,750 295,750 Total $ 265,750 $ 295,750 During the six months ended June 30, 2018 Hasfer, Inc and Carte Blanche, LLC entered into a note purchase agreement. Hasfer assigned $60,000 to Carte Blanche, LLC. The Company received additional proceeds of $30,000. During the six months ended June 30, 2018 the lenders converted $60,000 of the outstanding principal into 26,086,956 shares of the Company’s common stock. This resulted in a gain on extinguishment of debt of $4,581. Due to related party On May 16, 2018, the Company’s officer made non-interest bearing loans of $75,000 to the Company in the form of cash. The loan is due on demand and unsecured. On May 22, 2018, the Company’s officer made non-interest bearing loans of $30,000 to the Company in the form of cash. The loan is due on demand and unsecured. As of June 30, 2018 and December 31, 2017, the Company is reflecting a liability of $151,075, and $46,075, respectively. |
Derivative Liabilities
Derivative Liabilities | 6 Months Ended |
Jun. 30, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Liabilities | 7. Derivative Liabilities The Company has identified derivative instruments arising from embedded conversion features in the Company’s convertible notes payable and accounts payable at June 30, 2018. The following summarizes the Binomial-lattice model assumptions used to estimate the fair value of the derivative liability and warrant liability at the date of issuance and for the convertible notes converted during the six months ended June 30, 2018. Low High Annual dividend rate 0 % 0 % Expected life in years 0.25 1.00 Risk-free interest rate 1.78 % 2.35 % Expected volatility 116 % 182 % Risk-free interest rate: The Company uses the risk-free interest rate of a U.S. Treasury Note with a similar term on the date of the grant. Dividend yield: The Company uses a 0% expected dividend yield as the Company has not paid dividends to date and does not anticipate declaring dividends in the near future. Volatility: The volatility was estimated using the historical volatilities of the Company’s common stock. Remaining term: The Company’s remaining term is based on the remaining contractual maturity of the convertible notes payable and accounts payable. The following are the changes in the derivative liabilities during the six months ended June 30, 2018. Six Months Ended June 30, 2018 Level 1 Level 2 Level 3 Derivative liabilities as January 1, 2018 $ - $ - $ 2,596,005 Addition - - 281,515 Conversions (59,364 ) Gain on changes in fair value - - (1,191,940 ) Derivative liabilities as June 30, 2018 $ - $ - $ 1,626,216 |
Stockholders' Deficit
Stockholders' Deficit | 6 Months Ended |
Jun. 30, 2018 | |
Equity [Abstract] | |
Stockholders' Deficit | 8. Stockholders’ Deficit Reverse Capitalization Pursuant to the Merger Agreement, upon consummation of the Merger, each share of CDx’s capital stock issued and outstanding immediately prior to the Merger was converted into the right to receive one (1) share of Company common stock, par value $0.001 per share. Additionally, pursuant to the Merger Agreement, upon consummation of the Merger, the Company assumed all of CDx’s options and warrants issued and outstanding immediately prior to the Merger, 6,069,960 and 7,571,395 shares of common stock, respectively. Prior to and as a condition to the closing of the Merger, each then-current Company stockholder agreed to sell certain shares of common stock held by such holder to the Company and the then-current Company stockholders retained an aggregate of 1,990,637 shares of common stock. Preferred Stock On September 30, 2016, the Company filed a Certificate of Amendment to Articles of Incorporation with the Secretary of State of the State of Nevada to authorize for issuance ten million (10,000,000) shares of blank check preferred stock, par value $0.001 (“Blank Check Preferred Stock”) as included on Form 8-K filed with the SEC on October 4, 2016. Series A Preferred Stock As of June 30, 2018, and December 31, 2017, the Company has designated 51 shares of Series A Preferred Stock par value $0.001 and 51 shares are issued and outstanding. The Series A Preferred Stock can convert into common stock at a 1:1 ratio. Each one (1) share of the Series A Preferred shall have voting rights equal to (x) 0.019607 multiplied by the total issued and outstanding shares of Common Stock eligible to vote at the time of the respective vote (the “Numerator”), divided by (y) 0.49, minus (z) the Numerator. For purposes of illustration only, if the total issued and outstanding shares of Common Stock eligible to vote at the time of the respective vote is 5,000,000, the voting rights of one share of the Series A Preferred Stock shall be equal to 102,036 (0.019607 x 5,000,000) / 0.49) – (0.019607 x 5,000,000) = 102,036). On December 23, the 51 shares were issued to Mr. Yazbeck, the Company’s sole officer and the sole member of the Board. Mr. Yazbeck, via his ownership of the 51 shares of the Series A Preferred, has control of the majority of the Company’s voting stock. Series B Preferred Stock As of June 30, 2018, and December 31, 2017, the Company has designated 300,000 shares of Series B Preferred Stock par value $0.001 and 107,000 and 296,700 shares, respectively, were issued and outstanding. The Series B Preferred is convertible into shares of Common Stock at a conversion price of $0.0001. Holders of the Series B Preferred are entitled to receive dividends annually equal to $0.10 for each share of Series B Preferred held. In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company, the holders of Series B Preferred then outstanding shall be entitled to be paid out of the assets of the Company available for distribution to its stockholders, before any payment shall be made to the holders of Common Stock. Until such time as there are fewer than 20,000 shares of Series B Preferred outstanding, the Company needs to obtain the majority votes of the holders of Series B Preferred with regard to certain actions. Holders of Series B Preferred shares are entitled to one vote for each share held, are entitled to elect up to two members to the Board, and, absent such election, are provided certain voting and veto rights with regard to any vote by the Board. During the year ended December 31, 2017 an investor converted 3,300 Series B Preferred stock in to 33,000,000 shares of common stock. During the six months ended June 30, 2018 investors converted 189,700 Series B Preferred stock in to 1,897,000,000 shares of common stock. Common Stock On September 30, 2016, the Company amended articles of incorporation to increase the number of authorized common shares to 10,000,000,000 as included on Form 8-K filed with the SEC on October 4, 2016. On January 24, 2018, the Company issued 5,000,000 shares common stock to settle outstanding vendor liabilities of $30,000. In connection with this transaction the Company also recorded a gain on settlement of vendor liabilities of $4,500. During the six months ended June 30, 2018, the Company issued 57,500,000 shares of common stock in exchange for services at a fair value of $245,750. During the six months ended June 30, 2018, the Company issued 4,285,714 shares of its restricted common stock to consultants in exchange for services at a fair value of $13,286. These shares were recorded as common stock issued for prepaid services and will be expensed over the life of the consulting contract to share based payments. During the six months ended June 30, 2018 the Company recorded $8,760 to share based payments. Total stock-based compensation expense, for both employee and non-employee options, recognized by the Company for the six months ended June 30, 2018 was $1,971. No tax benefits were recognized in the six months ended June 30, 2018. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 9. Commitments and Contingencies Distribution and License Agreement and Joint Development Agreements The Company entered into a Distribution and License Agreement with a third-party for the purpose of developing a sensor array to be used in the Company’s product. The Distribution and License Agreement has an initial term of ten years, but can be terminated earlier if the project does not meet the specifications of the Company. The Company will obtain exclusive rights to sell and distribute once a successful sensor prototype is developed. In exchange for a functional prototype, the Company will pay the third-party a 7% royalty on net sales. During the six months ended June 30, 2018, the Company did not incur any development costs related to the Distribution and License Agreement. On November 1, 2013, the Company entered into a two-year Joint Development Agreement (the “Agreement”) with an unrelated third-party to develop chemical sensors and peripheral sensing equipment and software for the detection and characterization of cannabis and compounds associated with cannabis. The Agreement provides for, among other things, any arising intellectual property rights (as defined) outside of the field (as defined), and any arising intellectual property rights relating to improvements to detection materials shall belong to the Joint Venture Developer. The Agreement also provides that any arising intellectual property rights other than those covered above shall belong to the Company. To the extent that it is necessary to do so to enable the Company to use and exploit its respective arising intellectual property rights, the Joint Developer grants the Company a perpetual, irrevocable, exclusive, and royalty free license (including the right to assign the license and to grant sub-licenses) to use and exploit the Joint Developer’s arising intellectual property rights in the field. Under the terms of the Agreement, either party may cancel the Agreement as the specific tasks provided for in the Agreement have been completed or for causes specifically provided for in the Agreement. On May 19, 2015, the Company entered into an Exclusive Patent Sublicense Agreement (the “License Agreement”) with Next Dimension Technologies, Inc. (“NDT”). The License Agreement grants the Company a worldwide right to the patents licensed by NDT from the California Institute of Technology. The License Agreement grants both exclusive and non-exclusive patent rights. The license granted in the License Agreement permits the Company to make, have made, use, sell and offer for sale sublicensed products in the field of use. The License Agreement continues until the expiration, revocation, invalidation or enforceability of the rights licensed. The License Agreement provides for the payment of a license fee and royalty payments by CDx to NDT. The License Agreement also contains minimum royalty payments and milestone payments by CDx to NDT. NDT has a right to terminate the License Agreement in the event of an uncured breach by CDx; the insolvency or bankruptcy of CDx; or if CDx does not meet certain productivity milestones. The License Agreement also contains representations, warranties and indemnity obligations for each of CDx and NDT. In connection with the License Agreement, on May 19, 2015, CDx and NDT also executed an Amended Amendment No. 4 (the “Amended Amendment No. 4”) to the Joint Development Agreement, dated as of November 1, 2013, between CDx and NDT, which extended the date of negotiation for the License Agreement through May 19, 2015. On February 8, 2017, MyDx, Inc. entered into an option agreement (the “Option Agreement’) with the Torque Research & Development, Inc. (“TRD”). The Option Agreement provides MyDx with the exclusive right to license two patent pending inventions (the “TRD Inventions”), and requires MyDx to make annual payments to TRD as well as royalty payments on any products that are commercialized which are based on the TRD Inventions. MyDx’s rights under the Option Agreement require customary measures of performance on the part of MyDx in terms of patent cost maintenance and other payments of costs associated with the TRD Inventions. With respect to the Option Agreement, MyDx rights are broad in terms of the potential access MyDx has to use the TRD Inventions in products, and services and many of the key economic terms of a future license, should MyDx exercise its rights under the Option Agreement, are agreed to in the Option Agreement. In addition to the Option Agreement with the TRD, on February 8, 2017, MyDx has entered into a research and development agreement (the “RD Agreement”) with TRD for the Project titled “Manufacturable, Medical Grade Smart Vape Devices and Related Medical Software Applications for Prescribers, Administrators and Patient Applications.” The RD Agreement allows MyDx to fund research based on the TRD Inventions with a three year budget of $280,371 and a deferred payment of $75,000 within ninety days of the Effective Date. The RD Agreement provides MyDx with an exclusive right to license all technology that is discovered from the monies funded to TRD through the RD Agreement (the “Derivative IP”). To the extent that MyDx exercises its rights under the RD Agreement, MyDx will be required to make customary annual payments to TRD, who shall be the owners of any Derivative IP, as well as royalty payments as any commercialization of such Derivative IP occurs. TRD may elect to accept payment in whole or in part in cash or the companies restricted common stock priced at the Effective Date. MyDx is currently in default on its payment obligations to Torque. On January 26, 2018 the Company entered into a joint venture with Ganja Gold to form “NewCo”. With the formation of NewCo, the intent is for the Parties to manufacture and distribute a new premium line of physiological based Vape formulations under Ganja Gold Vape Brand (“GGV Brand”). The GGV Brand will be powered by MYDX data and formulations utilizing the Eco Smart Pen Device under an exclusive license of MYDX Power Formulations. MyDx will have the option to acquire 50% of NewCo. License and Distribution Agreement On June 12, 2017, MyDx, Inc. (the “Company” or “Licensor”) entered into a license and services agreement (the “License Agreement”) with Black Swan, LLC (the “Licensee”). The Licensor agreed to grant to the Licensee the Access License which shall consist of: (a) access to the database to enable Licensee to engage in formulation queries regarding the effects of having different amounts of terpene or other chemicals in cannabis strains; (b) access to the database’s chemical profile library and related definitions; (c) access to a list with the contact information and fee schedule of cannabis extractors with state licenses so that Licensee can submit the formulation query results to such licensed cannabis extractors. Such licensed extractor list may change and Licensor shall have no obligation to provide Licensee with an updated list; and (d) access to the CannaDxTM mobile application to track feedback and reviews by up to 20,000 users of Licensee’s products. The Licensor will provide the Product Services which shall consist of: (1) Licensor providing annual MyDx360 SAAS Premium Subscription at a cost of $15,000 per annum (2) Licensor providing 6,000 Cartridges every six months to the Licensee at a cost of $2.49 per Cartridge ($14,940 in total every six months). It shall be a requirement of this Agreement that Licensee order 6,000 Cartridges from Licensor every six months; (3) Licensor providing 1,000 Eco Smart Pens to the Licensee, when available, over the three-year term of this Agreement at a cost of $25 per Eco Smart Pen ($25,000 in total); and (4) Licensor providing 6,000 batteries to the Licensee over the three-year term of this Agreement at a cost of $3.99 per battery ($23,940 in total). The term of this Agreement shall be three (3) years. Licensor shall have the right, in its sole discretion, to terminate this Agreement if Licensee does not order and pay for at least 6,000 Cartridges every six months at a cost of $2.49 per Cartridge ($14,940 in total every six months). As of August 10, 2018, the Company and Black Swan temporarily have no obligations to each other pursuant to the June 12, 2017 License Agreement pending the Company’s release of the Eco Smart Pen. On April 26, 2018, MyDx, Inc. (the “Company” or “Licensor”) entered into a license and services agreement (the “License Agreement”) with Humanity Holdings (the “Licensee”). The Licensor agreed to grant to the Licensee access to the MyDx360 platform. The Licensor agreed to issue the Licensee $25,000 of shares on the 45 th Marketing and Advertising Advisory Services Agreement On April 5, 2016, the Company entered into a Marketing and Advertising Advisory Services Agreement (the “Agreement”) with Growth Point Advisors, Ltd. (“Growth Point”) for Growth Point to provide a comprehensive marketing, advertising and branding campaign for the Greater China Region on behalf of the Company’s MyDx AquaDx sensor. The campaign shall include, but not be limited to, the development of both the front and back-end of an e-commerce web site targeting the Chinese audience as well as introductions to potential key personnel to launch and manage the campaign. In consideration for the services described above, the Company shall pay Growth Point a monthly service fee of $30,000. Should the Company fail to pay the monthly service fee, Growth Point shall have the right to convert the monthly service fee into the Company’s common stock at a 50% discount of the lowest closing price of the Company’s common stock for the 15 trading days upon send notice of non-payment to the Company. On May 16, 2017, the Company terminated its Marketing and Advertising Advisory Services Agreement with Growth Point Advisors, Ltd. (“Growth Point”) entered into in April 2016. Growth Point had been expected to provide a comprehensive marketing, advertising and branding campaign for the Greater China Region on behalf of the Company’s MyDx AquaDx sensor. Growth Point failed to satisfy the agreed upon deliverables as stated in the agreement. As of the date of this filing the Company has not received communication from Growth Point. On February 17, 2017 MyDx and Libre Design, LLC (“LDL”) entered into a twelve (12) month Research, Branding, Advertising and Marketing Services Agreement (“Agency Agreement”). The Company agreed to pay deferred cash compensation as follows of three thousand dollars ($3,000) upon execution and one thousand five hundred dollars ($1,500) per month for a subsequent eleven (11) payments thereafter on or before the first (1st) of each month. In addition, Agency is entitled to receive sixty seven million shares of restricted common stock at a closing market price equal to $0.0011. On March 1st and 15th, 2017, MyDx, Inc. received a payment demand for the initial and subsequent payment of $50,000 and $25,000 per month respectively, exclusive of costs and other fees, due and owing under the BCI Advisors, LLC (“BCI”) advisory services agreement (the “Advisory Services Agreement”). The Company elected in lieu of cash to pay in unrestricted common stock, registered in form S-8. The Company made an initial payment of seventy five million shares in partial satisfaction of the amount due and owing that does not exceed the Company’s obligations under the Advisory Services Agreement to restrict BCI’s beneficial ownership to 4.99%. Subsequent to June 30, 2018 this agreement was canceled. On November 3, 2017 the Company and Phylos Bioscience, Inc. (“Phylos”) entered into a License, Co-Marketing, and Data Sharing Agreement (the “Phylos Agreement”). Pursuant to the Phylos Agreement, the Company and Phylos each granted a non-exclusive license to the other party to access their data and use their trademarks and logo on marketing materials. Neither party paid cash or issued shares in connection with the Phylos Agreement. The license was the consideration given by each party. The term of the Phylos Agreement is five (5) years. On February 1, 2018 MyDx and Erai Beckman entered into a twelve (12) month Scientific Research and Business Development Agreement. The Company agreed to pay $15,000 in restricted common stock on the first day of each quarter. In addition, Erai Beckman was issued 2,500,000 shares of the Company’s common stock on April 2, 2018. On June 1, 2018 MyDx and Erai Beckman entered into a twelve (12) month Research, Manufacturing, Advertising and Marketing Services Agreement. The Company issued 25,000,000 of the Company’s common as a signing bonus. Litigation In the normal course of business, the Company may be subject to legal proceedings, lawsuits and other claims. Although the ultimate aggregate amount of probable monetary liability or financial impact with respect to these matters is subject to many uncertainties and is therefore not predictable with assurance, the Company’s management believes that any monetary liability or financial impact to the Company from these other matters, individually and in the aggregate, would not be material to the Company’s financial condition, results of operations or cash flows. However, there can be no assurance with respect to such result, and monetary liability or financial impact to the Company from these other matters could differ materially from those projected. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | 10. Subsequent Events The Company has evaluated events that occurred subsequent to June 30, 2018 and through the date the financial statements were issued. Subsequent to June 30, 2018, the Company issued 38,272 shares of the Company’s Series B Preferred at a value of $1.00 per Series B Preferred share to settle outstanding vendor liability. The Company also agreed to the assignment or issuance of three warrants giving the holder the right to purchase seven and one half percent (7.5%) of the Company’s shares of common stock issued and outstanding at the time of exercise and having an exercise price of $0.001 per share. This form of warrant is referred to herein as the “7.5% Warrant.” The Company agreed to the assignment of one previously issued 7.5% Warrant to an entity related to BCI Advisors. This 7.5% Warrant expires on January 15, 2019. In addition, the Company also agreed to the assignment of another previously issued 7.5% Warrant to an entity related to BCI Advisors and agreed to extend the expiration date from March 1, 2019 to March 1, 2022. Finally, the Company agreed to issue a new 7.5% Warrant which will expire on January 15, 2022.Subsequent to June 30, 2018, the Company issued 45,355 shares of the Company’s Series B Preferred at a value of $1.00 per Series B Preferred share to settle outstanding vendor liability. The Company also agreed to issue a 7.5% Warrant with an expiration date of August 1, 2022. Subsequent to June 30, 2018, the Company issued 16,250,000 shares of its restricted common stock to consultants in exchange for services. Subsequent to June 30, 2018, the Company issued 12,121,212 shares of its restricted common stock to consultants in exchange for services. Subsequent to June 30, 2018, the Company entered into a convertible note purchase agreement. The Company received additional proceeds of $25,000. MyDx, Inc. 2018 Stock Incentive Plan On July 5, 2018, the Board approved the MyDx, Inc. 2018 Stock Incentive Plan (the “Plan”). Plan and declared it advisable and in the Company’s best interests and directed that there be submitted to the holder of a majority of the Company’s voting shares for action by written consent, the ratification of the Plan. On July 5, 2018, the majority stockholder approved and ratified the Plan via a written consent. No further vote of our stockholders is required. The Plan will become effective on or after August 13, 2018 (twenty (20) calendar days after the mailing of an information statement). The purpose of the Plan is to be able to continue to offer a competitive equity incentive program if to successfully attract, motivate and retain the most qualified candidates for all aspects of our business. Under the Plan, the Board is authorized to sell or award up to 250,000,000 shares and/or options of Common Stock; provided, however, if the outstanding Common Stock shall be hereafter increased or decreased, or changed into or exchanged for a different number or kind of shares or other securities of the Company or of another corporation, by reason of a recapitalization, reclassification, reorganization, merger, consolidation, share exchange, or other business combination in which the Company is the surviving parent corporation, stock split-up, combination of shares, or dividend or other distribution payable in capital stock or rights to acquire capital stock, appropriate adjustment shall be made by the Board in the number and kind of shares which may be granted under the Plan. For example, in the event the Company effectuates a 1-for-10 forward split, the number of Shares that are authorized by and may be sold under the Plan shall be 25,000,000. |
Summary of Significant Accoun16
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation - Unaudited Interim Financial Information | Basis of Presentation - Unaudited Interim Financial Information The accompanying unaudited interim condensed consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information, and in accordance with the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) with respect to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited interim condensed consolidated financial statements furnished reflect all adjustments (consisting of normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of the results for the interim periods presented. Interim results are not necessarily indicative of the results for the full year. These unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto contained in the Company’s annual report on Form 10-K for the year ended December 31, 2017. |
Use of Estimates | Use of Estimates The preparation of the consolidated finance statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the condensed consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. Such management estimates include allowance for doubtful accounts, estimates of product returns, warranty expense, inventory valuation, valuation allowances of deferred taxes, stock-based compensation expenses and fair value of warrants and derivatives. The Company bases its estimates on historical experience and on assumptions that it believes are reasonable. The Company assesses these estimates on a regular basis; however, actual results could materially differ from those estimates. |
Concentration of Risk Related to Third-party Suppliers | Concentration of Risk Related to Third-party Suppliers We depend on a limited number of third-party suppliers for the materials and components required to manufacture our products. A delay or interruption by our suppliers may harm our business, results of operations, and financial condition, and could also adversely affect our future profit margins. In addition, the lead time needed to establish a relationship with a new supplier can be lengthy, and we may experience delays in meeting demand in the event we must change or add new suppliers. Our dependence on our suppliers exposes us to numerous risks, including but not limited to the following: our suppliers may cease or reduce production or deliveries, raise prices, or renegotiate terms; we may be unable to locate a suitable replacement supplier on acceptable terms or on a timely basis, or at all; and delays caused by supply issues may harm our reputation, frustrate our customers, and cause them to turn to our competitors for future needs. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company recognizes and discloses the fair value of its assets and liabilities using a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). Each level of input has different levels of subjectivity and difficulty involved in determining fair value. Level 1 Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets at the measurable date. Level 2 Inputs, other than quoted prices included in Level 1, that are observable for the asset or liability through corroboration with market data at the measurement date. Level 3 Unobservable inputs that reflect management’s best estimate of what participants would use in pricing the asset or liability at the measurement date. The carrying amounts of the Company’s financial assets and liabilities, including cash, accounts receivable, accounts payable, and accrued liabilities approximate fair value because of the short maturity of these instruments. The carrying value of the Company’s loan payable and convertible notes payable approximates fair value based upon borrowing rates currently available to the Company for loans with similar terms. |
Business Segments | Business Segments ASC 280 defines operating segments as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performances. Currently, ASC 280 has no effect on the Company’s condensed consolidated financial statements as substantially all of the Company’s operations are conducted in one industry segment. |
Cash | Cash The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents. As of June 30, 2018 and December 31, 2017, the Company held no cash equivalents. The Company’s policy is to place its cash with high credit quality financial instruments and institutions and limit the amounts invested with any one financial institution or in any type of instrument. Deposits held with banks may exceed the amount of insurance provided on such deposits. The Company has not experienced any losses on its deposits of cash. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are recorded at the invoiced amount and are not interest bearing. The Company maintains an allowance for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments. The Company makes ongoing assumptions relating to the collectability of its accounts receivable in its calculation of the allowance for doubtful accounts. In determining the amount of the allowance, the Company makes judgments about the creditworthiness of customers based on ongoing credit evaluations and assesses current economic trends affecting its customers that might impact the level of credit losses in the future and result in different rates of bad debts than previously seen. The Company also considers its historical level of credit losses. As of June 30, 2018 and December 31, 2017, there was an allowance for doubtful accounts of $27,851 and $27,851 respectively. During the six months ended June 30, 2018 the Company recorded a bad debt expense of $0. |
Inventory | Inventory Inventory is stated at the lower of cost or market value. Inventory is determined to be salable based on demand forecast within a specific time horizon, generally eighteen months or less. Inventory in excess of salable amounts and inventory which is considered obsolete based upon changes in existing technology is written off. At the point of recognition, a new lower cost basis for that inventory is established and subsequent changes in facts and circumstances do not result in the restoration or increase in that new cost basis. |
Property and Equipment | Property and Equipment Property and equipment are recorded at cost, less accumulated depreciation and amortization. Depreciation and amortization are provided using the straight-line method over the useful life as follows: Internal-use software 3 years Equipment 3 to 5 years Computer equipment 3 to 7 years Furniture and fixtures 5 to 7 years Leasehold improvements Shorter of life of asset or lease |
Accounting for Website Development Costs | Accounting for Website Development Costs The Company capitalizes certain external and internal costs, including internal payroll costs, incurred in connection with the development of its website. These costs are capitalized beginning when the Company has entered the application development stage and cease when the project is substantially complete and is ready for its intended use. The website development costs are amortized using the straight-line method over the estimated useful life of three years. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets Long-lived assets, such as property and equipment, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future undiscounted net cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized in the amount by which the carrying amount of the asset exceeds the fair value of the asset. Assets to be disposed of would be separately presented in the balance sheets and reported at the lower of the carrying amount or fair value less costs to sell, and no longer depreciated. The assets and liabilities of a disposed group classified as held for sale would be presented separately in the appropriate asset and liability sections of the balance sheets. |
Debt Discount and Debt Issuance Costs | Debt Discount and Debt Issuance Costs Debt discounts and debt issuance costs incurred in connection with the issuance of debt are capitalized and amortized to interest expense based on the related debt agreements using the straight-line method. Unamortized discounts are netted against long-term debt. |
Derivative Liability | Derivative Liability In accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Paragraph 815-15-25-1 the conversion feature and certain other features are considered embedded derivative instruments, such as a conversion reset provision, a penalty provision and redemption option, which are to be recorded at their fair value as its fair value can be separated from the convertible note and its conversion is independent of the underlying note value. The Company records the resulting discount on debt related to the conversion features at initial transaction and amortizes the discount using the effective interest rate method over the life of the debt instruments. The conversion liability is then marked to market each reporting period with the resulting gains or losses shown in the statements of operations. In circumstances where the embedded conversion option in a convertible instrument is required to be bifurcated and there are also other embedded derivative instruments in the convertible instrument that are required to be bifurcated, the bifurcated derivative instruments are accounted for as a single, compound derivative instrument. The Company follows ASC Section 815-40-15 (“Section 815-40-15”) to determine whether an instrument (or an embedded feature) is indexed to the Company’s own stock. Section 815-40-15 provides that an entity should use a two-step approach to evaluate whether an equity-linked financial instrument (or embedded feature) is indexed to its own stock, including evaluating the instrument’s contingent exercise and settlement provisions. The adoption of Section 815-40-15 has affected the accounting for (i) certain freestanding warrants that contain exercise price adjustment features and (ii) convertible bonds issued by foreign subsidiaries with a strike price denominated in a foreign currency. The Company evaluates its convertible debt, options, warrants or other contracts, if any, to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with paragraph 810-10-05-4 and Section 815-40-25 of the FASB Accounting Standards Codification. The result of this accounting treatment is that the fair value of the embedded derivative is marked-to-market each balance sheet date and recorded as either an asset or a liability. In the event that the fair value is recorded as a liability, the change in fair value is recorded in the consolidated statement of operations as other income or expense. Upon conversion, exercise or cancellation of a derivative instrument, the instrument is marked to fair value at the date of conversion, exercise or cancellation and then that the related fair value is reclassified to equity. The Company utilizes the binomial option pricing model to compute the fair value of the derivative and to mark to market the fair value of the derivative at each balance sheet date. The binomial option pricing model includes subjective input assumptions that can materially affect the fair value estimates. The expected volatility is estimated based on the most recent historical period of time equal to the remaining contractual term of the instrument granted. |
Revenue Recognition | Revenue Recognition The Company adopted ASC 606 effective January 1, 2018 using the modified retrospective method which would require a cumulative effect adjustment for initially applying the new revenue standard as an adjustment to the opening balance of retained earnings and the comparative information would not require to be restated and continue to be reported under the accounting standards in effect for those periods. Based on the Company’s analysis the Company did not identify a cumulative effect adjustment for initially applying the new revenue standards. The Company principally generates revenue through providing product, services and licensing revenue. The adoption of ASC 606 represents a change in accounting principle that will more closely align revenue recognition with the delivery of the Company’s services and will provide financial statement readers with enhanced disclosures. In accordance with ASC 606, revenue is recognized when a customer obtains control of promised services. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for these services. To achieve this core principle, the Company applies the following five steps: 1) Identify the contract with a customer A contract with a customer exists when (i) the Company enters into an enforceable contract with a customer that defines each party’s rights regarding the services to be transferred and identifies the payment terms related to these services, (ii) the contract has commercial substance and, (iii) the Company determines that collection of substantially all consideration for services that are transferred is probable based on the customer’s intent and ability to pay the promised consideration. The Company applies judgment in determining the customer’s ability and intention to pay, which is based on a variety of factors including the customer’s historical payment experience or, in the case of a new customer, published credit and financial information pertaining to the customer. 2) Identify the performance obligations in the contract Performance obligations promised in a contract are identified based on the services that will be transferred to the customer that are both capable of being distinct, whereby the customer can benefit from the service either on its own or together with other resources that are readily available from third parties or from the Company, and are distinct in the context of the contract, whereby the transfer of the services is separately identifiable from other promises in the contract. To the extent a contract includes multiple promised services, the Company must apply judgment to determine whether promised services are capable of being distinct and distinct in the context of the contract. If these criteria are not met the promised services are accounted for as a combined performance obligation. 3) Determine the transaction price The transaction price is determined based on the consideration to which the Company will be entitled in exchange for transferring services to the customer. To the extent the transaction price includes variable consideration, the Company estimates the amount of variable consideration that should be included in the transaction price utilizing either the expected value method or the most likely amount method depending on the nature of the variable consideration. Variable consideration is included in the transaction price if, in the Company’s judgment, it is probable that a significant future reversal of cumulative revenue under the contract will not occur. None of the Company’s contracts as of June 30, 2018 contained a significant financing component. Determining the transaction price requires significant judgment, which is discussed by revenue category in further detail below. 4) Allocate the transaction price to performance obligations in the contract If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. However, if a series of distinct services that are substantially the same qualifies as a single performance obligation in a contract with variable consideration, the Company must determine if the variable consideration is attributable to the entire contract or to a specific part of the contract. For example, a bonus or penalty may be associated with one or more, but not all, distinct services promised in a series of distinct services that forms part of a single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price to each performance obligation based on a relative standalone selling price basis unless the transaction price is variable and meets the criteria to be allocated entirely to a performance obligation or to a distinct service that forms part of a single performance obligation. The Company determines standalone selling price based on the price at which the performance obligation is sold separately. If the standalone selling price is not observable through past transactions, the Company estimates the standalone selling price taking into account available information such as market conditions and internally approved pricing guidelines related to the performance obligations. 5) Recognize revenue when or as the Company satisfies a performance obligation The Company satisfies performance obligations either over time or at a point in time. Revenue is recognized at the time the related performance obligation is satisfied by transferring a promised service to a customer. Product revenue Revenue from multiple-element arrangements is allocated among separate elements based on their estimated sales prices, provided the elements have value on a stand-alone basis. Licensing revenue Some of the Company’s revenues are generated from software-as-a-service (“SaaS”) subscription offerings and related product support and maintenance. SaaS revenues stem mainly from annual subscriptions and are recorded evenly over the term of the subscription. Any customer payments received in advance are deferred until they are earned. Consulting and training revenues are recognized as work is performed. |
Product revenue | Product Returns For any product in its original, undamaged and unmarked condition, with its included accessories and packaging along with the original receipt (or gift receipt) within 30 days of the date the customer receives the product, the Company will exchange it or offer a refund based upon the original payment method. |
Product Returns | Product Returns For any product in its original, undamaged and unmarked condition, with its included accessories and packaging along with the original receipt (or gift receipt) within 30 days of the date the customer receives the product, the Company will exchange it or offer a refund based upon the original payment method. |
Customer Deposits | Customer Deposits The Company accounts for funds received from crowdfunding campaigns and pre-sales as a liability on the consolidated balance sheets as the investments made entitle the investor to apply these funds towards future shipments once the product has been developed and available for commercial use. |
Research and Development Costs | Research and Development Costs Research and development costs are charged to expense as incurred. These costs consist primarily of salaries and direct payroll-related costs. It also includes purchased materials and services provided by independent contractors, software developed by other companies and incorporated into or used in the development of our final products. Research and development expenses for the six months ended June 30, 2018 and 2017 were $272,308 and $48,007, respectively. |
Advertising Costs | Advertising Costs Advertising costs are charged to sales and marketing expenses and general and administrative expenses as incurred. Advertising expenses, which are recorded in sales and marketing and general and administrative expenses, totaled $111,125 and $673,393 for the six months ended June 30, 2018 and 2017, respectively. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for stock-based compensation in accordance with ASC Topic 718, “ Compensation – Stock Compensation” The Company accounts for share-based payments to non-employees in accordance with ASC 505-50 “ Equity Based Payments to Non-Employees |
Warranty | Warranty The Company provides a limited warranty for its analyzers and sensors for a period of 1 year from the date of shipment that such goods will be free from material defects in material and workmanship. The Company has assessed the historical claims and, to date, warranty claims have not been significant. The Company will continue to assess the need to record a warranty accrual at the time of sale going forward. |
Collaborative Arrangements | Collaborative Arrangements The Company and its collaborative partners are active participants in the collaborative arrangements and both parties are exposed to significant risks and rewards depending on the commercial success of the activity. The Company records all expenses related to collaborative arrangements as research and development expense in the consolidated statements of operations as incurred. |
Earnings per Share | Earnings per Share Earnings Per Share (“EPS”) is the amount of earnings attributable to each share of common stock. For convenience, the term is used to refer to either earnings or loss per share. EPS is computed pursuant to section 260-10-45 of the FASB Accounting Standards Codification. Pursuant to ASC Paragraphs 260-10-45-10 through 260-10-45-16 Basic EPS shall be computed by dividing income available to common stockholders (the numerator) by the weighted-average number of common shares outstanding (the denominator) during the period. The computation of diluted EPS is similar to the computation of basic EPS except that the denominator is increased to include the number of additional common shares that would have been outstanding if the dilutive potential common shares had been issued during the period to reflect the potential dilution that could occur from common shares issuable through contingent shares issuance arrangement, stock options or warrants. Pursuant to ASC Paragraphs 260-10-45-45-21 through 260-10-45-45-23 Diluted EPS shall be based on the most advantageous conversion rate or exercise price from the standpoint of the security holder. The dilutive effect of outstanding convertible preferred stock, convertible payables, call options and warrants (and their equivalents) issued by the reporting entity shall be reflected in diluted EPS by application of the treasury stock method. Under the treasury stock method: a. Exercise of options and warrants shall be assumed at the beginning of the period (or at time of issuance, if later) and common shares shall be assumed to be issued. b. The proceeds from exercise shall be assumed to be used to purchase common stock at the average market price during the period. c. The incremental shares (the difference between the number of shares assumed issued and the number of shares assumed purchased) shall be included in the denominator of the diluted EPS computation. Pursuant to ASC Paragraphs 260-10-45-40 through 45-42 convertible securities shall be reflected in diluted EPS by application of the if-converted method. The convertible preferred stock or convertible debt shall be assumed to have been converted at the beginning of the period (or at time of issuance, if later). In applying the if-converted method, conversion shall not be assumed for purposes of computing diluted EPS if the effect would be anti-dilutive. The following table provides a reconciliation of the numerator and denominator used in computing basic and diluted net income (loss) attributable to common stockholders per common share. For the Three Months Ended For the Six Months Ended June 30, June 30, June 30, June 30, 2018 2017 2018 2017 Numerator: Net income/(loss) attributable to common stockholders $ (810,310 ) $ 2,967,808 $ 69,595 $ (2,132,464 ) Effect of dilutive securities: Convertible note - Interest expense - 18,379 - - Net change in derivative liabilities - convertible payables - 4,306,970 - - Diluted net income (loss) $ (810,310 ) $ 7,293,157 $ 69,595 $ (2,132,464 ) Denominator: Weighted average common shares outstanding - basic 3,007,985,341 1,574,702,974 2,452,630,014 1,348,619,233 Dilutive securities (a): Series A Preferred stock - 51 51 - Series B Preferred stock - 3,000,000,000 1,070,000,000 - Convertible notes payable - 16,337,778 - - Convertible accounts payable - 194,785,455 379,889,803 - Options - - - - Warrants - 252,771,972 96,589,953 - Weighted average common shares outstanding and assumed conversion - diluted 3,007,985,341 5,038,598,230 3,999,109,821 1,348,619,233 Basic net income (loss) per common share $ (0.00 ) $ 0.00 $ 0.00 $ (0.00 ) Diluted net income (loss) per common share $ (0.00 ) $ 0.00 $ 0.00 $ (0.00 ) (a) - Anti-dilutive options excluded: 1,700,463,104 261,835,175 153,983,297 3,472,958,459 The Company had the following common stock equivalents at June 30, 2018 and 2017: June 30, June 30, Series A Preferred stock 51 51 Series B Preferred stock 1,070,000,000 3,000,000,000 Convertible notes payable 144,915,652 16,337,778 Convertible accounts payable 379,889,803 194,785,455 Options 1,496,250 1,490,026 Warrants 104,161,788 260,345,149 Totals 1,700,463,053 3,472,958,459 There were approximately 1,855,927,821 potentially outstanding dilutive common shares for the period ended June 30, 2018. Since the Company incurred a net loss for the period ended June 30, 2017, the inclusion of any common stock equivalents would have been anti-dilutive. |
Recent Accounting Guidance Adopted | Recent Accounting Guidance Adopted In April 2016, the FASB issued ASU No. 2016-10, “ Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross verses Net)” In May 2016, the FASB issued ASU No. 2016-12, “Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients”, which narrowly amended the revenue recognition guidance regarding collectability, noncash consideration, presentation of sales tax and transition and is effective during the same period as ASU 2014-09. The adoption of ASU 2016-12 had no material effect on its financial position or results of operations or cash flows. Management does not believe that any recently issued, but not yet effective accounting pronouncements, when adopted, will have a material effect on the accompanying condensed consolidated financial statements. |
Summary of Significant Accoun17
Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Schedule of depreciation and amortization are provided using the straight-line method over the useful life | Internal-use software 3 years Equipment 3 to 5 years Computer equipment 3 to 7 years Furniture and fixtures 5 to 7 years Leasehold improvements Shorter of life of asset or lease |
Schedule of basic and diluted net income (loss) attributable to common stockholders per common share | For the Three Months Ended For the Six Months Ended June 30, June 30, June 30, June 30, 2018 2017 2018 2017 Numerator: Net income/(loss) attributable to common stockholders $ (810,310 ) $ 2,967,808 $ 69,595 $ (2,132,464 ) Effect of dilutive securities: Convertible note - Interest expense - 18,379 - - Net change in derivative liabilities - convertible payables - 4,306,970 - - Diluted net income (loss) $ (810,310 ) $ 7,293,157 $ 69,595 $ (2,132,464 ) Denominator: Weighted average common shares outstanding - basic 3,007,985,341 1,574,702,974 2,452,630,014 1,348,619,233 Dilutive securities (a): Series A Preferred stock - 51 51 - Series B Preferred stock - 3,000,000,000 1,070,000,000 - Convertible notes payable - 16,337,778 - - Convertible accounts payable - 194,785,455 379,889,803 - Options - - - - Warrants - 252,771,972 96,589,953 - Weighted average common shares outstanding and assumed conversion - diluted 3,007,985,341 5,038,598,230 3,999,109,821 1,348,619,233 Basic net income (loss) per common share $ (0.00 ) $ 0.00 $ 0.00 $ (0.00 ) Diluted net income (loss) per common share $ (0.00 ) $ 0.00 $ 0.00 $ (0.00 ) (a) - Anti-dilutive options excluded: 1,700,463,104 261,835,175 153,983,297 3,472,958,459 |
Schedule of common stock equivalents | June 30, June 30, Series A Preferred stock 51 51 Series B Preferred stock 1,070,000,000 3,000,000,000 Convertible notes payable 144,915,652 16,337,778 Convertible accounts payable 379,889,803 194,785,455 Options 1,496,250 1,490,026 Warrants 104,161,788 260,345,149 Totals 1,700,463,053 3,472,958,459 |
Inventory (Tables)
Inventory (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Inventory Disclosure [Abstract] | |
Schedule of inventory | June 30, December 31, 2018 2017 Finished goods $ 14,992 $ 49,889 Raw materials 148,742 130,614 $ 163,734 $ 180,503 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of convertible notes | June 30, December 31, 2018 2017 Convertible Note - February 6, 2017 265,750 295,750 Total $ 265,750 $ 295,750 |
Derivative Liabilities (Tables)
Derivative Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Binomial-lattice model assumptions used to estimate the fair value of the derivative liability and warrant liability | Low High Annual dividend rate 0 % 0 % Expected life in years 0.25 1.00 Risk-free interest rate 1.78 % 2.35 % Expected volatility 116 % 182 % |
Schedule of changes in the derivative liabilities | Six Months Ended June 30, 2018 Level 1 Level 2 Level 3 Derivative liabilities as January 1, 2018 $ - $ - $ 2,596,005 Addition - - 281,515 Conversions (59,364 ) Gain on changes in fair value - - (1,191,940 ) Derivative liabilities as June 30, 2018 $ - $ - $ 1,626,216 |
Going Concern (Details)
Going Concern (Details) - USD ($) | Jun. 30, 2018 | Dec. 31, 2017 | Jun. 30, 2017 | Dec. 31, 2016 |
Going Concern (Textual) | ||||
Cash | $ 41,889 | $ 119,028 | $ 108,252 | $ 38,203 |
Summary of Significant Accoun22
Summary of Significant Accounting Policies (Details) | 6 Months Ended |
Jun. 30, 2018 | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, useful life | 3 years |
Internal-use software [Member] | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, useful life | 3 years |
Equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, useful life | 3 years |
Equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, useful life | 5 years |
Computer equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, useful life | 3 years |
Computer equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, useful life | 7 years |
Furniture and fixtures [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, useful life | 5 years |
Furniture and fixtures [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, useful life | 7 years |
Leasehold improvements [Member] | |
Property, Plant and Equipment [Line Items] | |
Property and equipment useful life method, description | Shorter of life of asset or lease |
Summary of Significant Accoun23
Summary of Significant Accounting Policies (Details 1) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Numerator: | ||||
Net income/(loss) attributable to common stockholders | $ (810,310) | $ 2,967,808 | $ 69,595 | $ (2,132,464) |
Effect of dilutive securities: | ||||
Convertible note - Interest expense | 18,379 | |||
Net change in derivative liabilities - convertible payables | 4,306,970 | |||
Diluted net income (loss) | $ (810,310) | $ 7,293,157 | $ 69,595 | $ (2,132,464) |
Denominator: | ||||
Weighted average common shares outstanding - basic | 3,007,985,341 | 1,574,702,974 | 2,452,630,014 | 1,348,619,233 |
Weighted average common shares outstanding and assumed conversion - diluted | 3,007,985,341 | 5,038,598,230 | 3,999,109,821 | 1,348,619,233 |
Basic net income (loss) per common share | $ 0 | $ 0 | $ 0 | $ 0 |
Diluted net income (loss) per common share | $ 0 | $ 0 | $ 0 | $ 0 |
(a) - Anti-dilutive options excluded: | 1,700,463,104 | 261,835,175 | 153,983,297 | 3,472,958,459 |
Options [Member] | ||||
Denominator: | ||||
Weighted average common shares outstanding - basic | ||||
Warrants [Member] | ||||
Denominator: | ||||
Weighted average common shares outstanding - basic | 96,589,953 | 252,771,972 | ||
Series A Preferred stock [Member] | ||||
Denominator: | ||||
Weighted average common shares outstanding - basic | 51 | 51 | ||
Series B Preferred stock [Member] | ||||
Denominator: | ||||
Weighted average common shares outstanding - basic | 3,000,000,000 | 1,070,000,000 | ||
Convertible notes payable [Member] | ||||
Denominator: | ||||
Weighted average common shares outstanding - basic | 16,337,778 | |||
Convertible accounts payable [Member] | ||||
Denominator: | ||||
Weighted average common shares outstanding - basic | 194,785,455 | 379,889,803 |
Summary of Significant Accoun24
Summary of Significant Accounting Policies (Details 2) - shares | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Summary of Significant Accounting Policies [Line Items] | ||
Common stock equivalents | 1,700,463,053 | 3,472,958,459 |
Options [Member] | ||
Summary of Significant Accounting Policies [Line Items] | ||
Common stock equivalents | 1,496,250 | 1,490,026 |
Warrants [Member] | ||
Summary of Significant Accounting Policies [Line Items] | ||
Common stock equivalents | 104,161,788 | 260,345,149 |
Series A Preferred stock [Member] | ||
Summary of Significant Accounting Policies [Line Items] | ||
Common stock equivalents | 51 | 51 |
Series B Preferred stock [Member] | ||
Summary of Significant Accounting Policies [Line Items] | ||
Common stock equivalents | 1,070,000,000 | 3,000,000,000 |
Convertible notes payable [Member] | ||
Summary of Significant Accounting Policies [Line Items] | ||
Common stock equivalents | 144,915,652 | 16,337,778 |
Convertible accounts payable [Member] | ||
Summary of Significant Accounting Policies [Line Items] | ||
Common stock equivalents | 379,889,803 | 194,785,455 |
Summary of Significant Accoun25
Summary of Significant Accounting Policies (Details Textual) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Summary of Significant Accounting Policies (Textual) | |||||
Warrants period | 1 year | ||||
Allowance for doubtful accounts | $ 27,851 | $ 27,851 | $ 27,851 | ||
Research and development expenses | $ 39,218 | $ 27,724 | 272,308 | $ 48,007 | |
Bad debt expense | |||||
Outstanding dilutive common shares | 1,855,927,821 | ||||
Property, plant and equipment, useful life | 3 years | ||||
General and Administrative Expenses [Member] | |||||
Summary of Significant Accounting Policies (Textual) | |||||
Advertising expense | $ 111,125 | 673,393 | |||
Sales and Marketing [Member] | |||||
Summary of Significant Accounting Policies (Textual) | |||||
Advertising expense | $ 111,125 | $ 673,393 |
Inventory (Details)
Inventory (Details) - USD ($) | Jun. 30, 2018 | Dec. 31, 2017 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 14,992 | $ 49,889 |
Raw materials | 148,742 | 130,614 |
Inventory | $ 163,734 | $ 180,503 |
Debt (Details)
Debt (Details) - USD ($) | Jun. 30, 2018 | Dec. 31, 2017 |
Debt Disclosure [Abstract] | ||
Convertible Note - February 6, 2017 | $ 265,750 | $ 295,750 |
Total | $ 265,750 | $ 295,750 |
Debt (Details Textual)
Debt (Details Textual) - USD ($) | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | May 22, 2018 | May 16, 2018 | Dec. 31, 2017 | |
Debt (Textual) | |||||||
Due to related party liability | $ 151,075 | $ 151,075 | $ 46,075 | ||||
Gain on extinguishment of debt | 4,581 | 4,581 | |||||
Note purchase agreement [Member] | |||||||
Debt (Textual) | |||||||
Hasfer assigned amount | 60,000 | 60,000 | |||||
Received additional proceeds | 30,000 | ||||||
Lenders [Member] | |||||||
Debt (Textual) | |||||||
Convertible note principal amount | $ 60,000 | $ 60,000 | |||||
Converted into common stock shares | 26,086,956 | ||||||
Officer [Member] | |||||||
Debt (Textual) | |||||||
Non-interest bearing loans | $ 30,000 | $ 75,000 |
Derivative Liabilities (Details
Derivative Liabilities (Details) | 6 Months Ended |
Jun. 30, 2018 | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |
Annual dividend rate | 0.00% |
Fair value of derivative liability and warrant liability [Member] | Low Level [Member] | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |
Expected life in years | 2 months 30 days |
Risk-free interest rate | 1.78% |
Expected volatility | 116.00% |
Fair value of derivative liability and warrant liability [Member] | High Level [Member] | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |
Expected life in years | 1 year |
Risk-free interest rate | 2.35% |
Expected volatility | 182.00% |
Derivative Liabilities (Detai30
Derivative Liabilities (Details 1) | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Level 1 [Member] | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |
Derivative liabilities as January 1, 2018 | |
Addition | |
Conversions | |
Gain on changes in fair value | |
Derivative liabilities as June 30, 2018 | |
Level 2 [Member] | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |
Derivative liabilities as January 1, 2018 | |
Addition | |
Conversions | |
Gain on changes in fair value | |
Derivative liabilities as June 30, 2018 | |
Level 3 [Member] | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |
Derivative liabilities as January 1, 2018 | 2,596,005 |
Addition | 281,515 |
Conversions | (59,364) |
Gain on changes in fair value | (1,191,940) |
Derivative liabilities as June 30, 2018 | $ 1,626,216 |
Derivative Liabilities (Detai31
Derivative Liabilities (Details Textual) | 6 Months Ended |
Jun. 30, 2018 | |
Derivative Liabilities (Textual) | |
Dividend yield | 0.00% |
Stockholders' Deficit (Details)
Stockholders' Deficit (Details) - USD ($) | 1 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jan. 24, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | Sep. 30, 2016 | |
Stockholders' Deficit (Textual) | |||||
Common stock, par value | $ 0.001 | $ 0.001 | |||
Common stock, shares authorized | 10,000,000,000 | 10,000,000,000 | |||
Employee and non-employee stock-based compensation expense | $ 1,971 | ||||
Share based payments | $ 1,971 | $ 247,420 | |||
Restricted common stock to consultants [Member] | |||||
Stockholders' Deficit (Textual) | |||||
Shares of common stock in exchange for services | 4,285,714 | ||||
Shares of common stock in exchange for services fair value | $ 13,286 | ||||
Share based payments | $ 8,760 | ||||
Series B Preferred Stock [Member] | |||||
Stockholders' Deficit (Textual) | |||||
Preferred stock, par value | $ 0.001 | $ 0.001 | |||
Authorize for issuance of shares of blank check preferred stock | 300,000 | 300,000 | |||
Preferred stock, description | The Series B Preferred is convertible into shares of Common Stock at a conversion price of $0.0001. Holders of the Series B Preferred are entitled to receive dividends annually equal to $0.10 for each share of Series B Preferred held. In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company, the holders of Series B Preferred then outstanding shall be entitled to be paid out of the assets of the Company available for distribution to its stockholders, before any payment shall be made to the holders of Common Stock. Until such time as there are fewer than 20,000 shares of Series B Preferred outstanding. | ||||
Purchase price | $ 1 | ||||
Preferred stock, shares issued | 107,000 | 296,700 | |||
Preferred stock, shares outstanding | 107,000 | 296,700 | |||
Series B Preferred Stock [Member] | Investor [Member] | |||||
Stockholders' Deficit (Textual) | |||||
Converted common stock, shares | 189,700 | 3,300 | |||
Series A Preferred Stock [Member] | |||||
Stockholders' Deficit (Textual) | |||||
Preferred stock, par value | $ 0.001 | $ 0.001 | |||
Authorize for issuance of shares of blank check preferred stock | 51 | 51 | |||
Preferred stock, description | The Series A Preferred Stock can convert into common stock at a 1:1 ratio. Each one (1) share of the Series A Preferred shall have voting rights equal to (x) 0.019607 multiplied by the total issued and outstanding shares of Common Stock eligible to vote at the time of the respective vote (the “Numerator”), divided by (y) 0.49, minus (z) the Numerator. For purposes of illustration only, if the total issued and outstanding shares of Common Stock eligible to vote at the time of the respective vote is 5,000,000, the voting rights of one share of the Series A Preferred Stock shall be equal to 102,036 (0.019607 x 5,000,000) / 0.49) – (0.019607 x 5,000,000) = 102,036). On December 23, the 51 shares were issued to Mr. Yazbeck, the Company’s sole officer and the sole member of the Board. Mr. Yazbeck, via his ownership of the 51 shares of the Series A Preferred, has control of the majority of the Company’s voting stock. | ||||
Preferred stock, shares issued | 51 | 51 | |||
Preferred stock, shares outstanding | 51 | 51 | |||
Preferred stock designated | 51 | 51 | |||
CDx's [Member] | |||||
Stockholders' Deficit (Textual) | |||||
Warrants converted into the right to receive share of company common stock | 1 | ||||
Common stock, par value | $ 0.001 | ||||
Warrants issued shares of common stock | 6,069,960 | ||||
Warrants outstanding shares of common stock | 7,571,395 | ||||
Retained Aggregate shares of common stock | 1,990,637 | ||||
Common Stock [Member] | |||||
Stockholders' Deficit (Textual) | |||||
Common stock, shares authorized | 10,000,000,000 | ||||
Shares of common stock in exchange for services | 5,000,000 | 57,500,000 | |||
Shares of common stock in exchange for services fair value | $ 245,750 | ||||
Outstanding vendor liabilities | $ 30,000 | ||||
Gain on settlement of vendor liabilities | $ 4,500 | ||||
Common Stock [Member] | Investor [Member] | |||||
Stockholders' Deficit (Textual) | |||||
Converted common stock, shares | 1,897,000,000 | 33,000,000 | |||
Blank Check Preferred Stock [Member] | |||||
Stockholders' Deficit (Textual) | |||||
Preferred stock, par value | $ 0.001 | ||||
Authorize for issuance of shares of blank check preferred stock | 10,000,000 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) | Jun. 01, 2018 | Feb. 01, 2018 | Mar. 15, 2017 | Mar. 01, 2017 | Feb. 08, 2017 | Apr. 05, 2016 | Apr. 26, 2018 | Jan. 26, 2018 | Feb. 17, 2017 | Jun. 30, 2018 |
Commitments and Contingencies (Textual) | ||||||||||
Distribution and license agreement term | 10 years | |||||||||
Royalty percentage | 7.00% | |||||||||
Option to acquire, percentage | 50.00% | |||||||||
License products | $ 20,000 | |||||||||
License Agreement [Member] | ||||||||||
Commitments and Contingencies (Textual) | ||||||||||
Distribution and license agreement term | 3 years | |||||||||
Product services, description | The Licensor will provide the Product Services which shall consist of: (1) Licensor providing annual MyDx360 SAAS Premium Subscription at a cost of $15,000 per annum (2) Licensor providing 6,000 Cartridges every six months to the Licensee at a cost of $2.49 per Cartridge ($14,940 in total every six months). It shall be a requirement of this Agreement that Licensee order 6,000 Cartridges from Licensor every six months; (3) Licensor providing 1,000 Eco Smart Pens to the Licensee, when available, over the three-year term of this Agreement at a cost of $25 per Eco Smart Pen ($25,000 in total); and (4) Licensor providing 6,000 batteries to the Licensee over the three-year term of this Agreement at a cost of $3.99 per battery ($23,940 in total). The term of this Agreement shall be three (3) years. Licensor shall have the right, in its sole discretion, to terminate this Agreement if Licensee does not order and pay for at least 6,000 Cartridges every six months at a cost of $2.49 per Cartridge ($14,940 in total every six months). | |||||||||
Mydx, Inc. [Member] | ||||||||||
Commitments and Contingencies (Textual) | ||||||||||
Debt instrument periodic payment | $ 25,000 | $ 50,000 | ||||||||
Percentage of beneficial ownership | 4.99% | 4.99% | ||||||||
Mydx, Inc. [Member] | Libre Design, LLC [Member] | ||||||||||
Commitments and Contingencies (Textual) | ||||||||||
Deferred compensation arrangements overall description | The Company agreed to pay deferred cash compensation as follows of three thousand dollars ($3,000) upon execution and one thousand five hundred dollars ($1,500) per month for a subsequent eleven (11) payments thereafter on or before the first (1st) of each month. In addition, Agency is entitled to receive sixty seven million shares of restricted common stock at a closing market price equal to $0.0011. | |||||||||
TRD [Member] | ||||||||||
Commitments and Contingencies (Textual) | ||||||||||
Three year budget amount | $ 280,371 | |||||||||
TRD invention term | 3 years | |||||||||
Debt instrument, description | The RD Agreement allows MyDx to fund research based on the TRD Inventions with a three year budget of $280,371 and a deferred payment of $75,000 within ninety days of the Effective Date. | |||||||||
Debt instrument periodic payment | $ 75,000 | |||||||||
Marketing and Advertising Advisory Services Agreement [Member] | ||||||||||
Commitments and Contingencies (Textual) | ||||||||||
Monthly service fee | $ 30,000 | |||||||||
Percentage of conversion units of discount | 50.00% | |||||||||
Common stock trading days | 15 days | |||||||||
Research, Manufacturing, Advertising and Marketing Services Agreement [Member] | ||||||||||
Commitments and Contingencies (Textual) | ||||||||||
Initial payment of shares issued | 25,000,000 | |||||||||
License and Service Agreement [Member] | ||||||||||
Commitments and Contingencies (Textual) | ||||||||||
Issue of licensee shares | 25,000 | |||||||||
Lease agreement term | 2 years | |||||||||
Lease net sales, description | The Licensee will pay a support and service fee equal to 20% of net sales and a royalty of 30% of net sales. | |||||||||
Research and Business Development Agreement [Member] | ||||||||||
Commitments and Contingencies (Textual) | ||||||||||
Restricted common stock, shares | 2,500,000 | |||||||||
Restricted common stock value | $ 15,000 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2018 | Dec. 31, 2017 | |
Subsequent Events (Textual) | ||
Common stock, shares authorized | 10,000,000,000 | 10,000,000,000 |
2018 Stock Incentive Plan [Member] | ||
Subsequent Events (Textual) | ||
Common stock, shares authorized | 250,000,000 | |
Convertible note purchase agreement [Member] | ||
Subsequent Events (Textual) | ||
Received additional proceeds | $ 25,000 | |
Stockholders forward split, description | The Company effectuates a 1-for-10 forward split, the number of Shares that are authorized by and may be sold under the Plan shall be 25,000,000. | |
Restricted common stock to consultants [Member] | ||
Subsequent Events (Textual) | ||
Restricted common stock to consultants issued | 12,121,212 | |
Restricted common stock, shares | 16,250,000 | |
Series B Preferred stock [Member] | ||
Subsequent Events (Textual) | ||
Issuance of common stock shares | 38,272 | |
Issuance of warrants, description | The Company also agreed to the assignment or issuance of three warrants giving the holder the right to purchase seven and one half percent (7.5%) of the Company’s shares of common stock issued and outstanding at the time of exercise and having an exercise price of $0.001 per share. This form of warrant is referred to herein as the “7.5% Warrant.” The Company agreed to the assignment of one previously issued 7.5% Warrant to an entity related to BCI Advisors. This 7.5% Warrant expires on January 15, 2019. In addition, the Company also agreed to the assignment of another previously issued 7.5% Warrant to an entity related to BCI Advisors and agreed to extend the expiration date from March 1, 2019 to March 1, 2022. Finally, the Company agreed to issue a new 7.5% Warrant which will expire on January 15, 2022.Subsequent to June 30, 2018, the Company issued 45,355 shares of the Company’s Series B Preferred at a value of $1.00 per Series B Preferred share to settle outstanding vendor liability. The Company also agreed to issue a 7.5% Warrant with an expiration date of August 1, 2022. | |
Common stock price | $ 1 |