Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Nov. 30, 2018 | Jan. 14, 2019 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | ARTELO BIOSCIENCES, INC. | |
Entity Central Index Key | 1,621,221 | |
Trading Symbol | artl | |
Current Fiscal Year End Date | --08-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 15,282,687 | |
Document Type | 10-Q | |
Document Period End Date | Nov. 30, 2018 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,019 | |
Document Fiscal Period Focus | Q1 | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Nov. 30, 2018 | Aug. 31, 2018 |
Current Assets | ||
Cash and cash equivalents | $ 115,074 | $ 337,424 |
Prepaid expenses and deposits | 46,346 | 36,884 |
Other receivable | 3,462 | 22,127 |
Total Current Assets | 164,882 | 396,435 |
Equipment, net of accumulated depreciation of $344 and $282, respectively | 481 | 563 |
TOTAL ASSETS | 165,363 | 396,998 |
Current Liabilities | ||
Accounts payable and accrued liabilities | 634,699 | 529,272 |
Due to related party | 5,828 | 2,700 |
Total Current Liabilities | 640,527 | 531,972 |
STOCKHOLDERS' DEFICIT | ||
Preferred Stock, par value $0.001, 50,000,000 shares authorized, 0 and 0 shares issued and outstanding as of November 30, 2018 and August 31, 2018, respectively | ||
Common Stock, par value $0.001, 150,000,000 shares authorized, 14,230,020 and 14,002,293 shares issued and outstanding as of November 30, 2018 and August 31, 2018, respectively | 14,230 | 14,002 |
Additional paid-in capital | 2,713,481 | 2,501,884 |
Accumulated deficit | (3,195,483) | (2,638,580) |
Accumulated other comprehensive loss | (7,392) | (12,280) |
Total Stockholders' Deficit | (475,164) | (134,974) |
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT | $ 165,363 | $ 396,998 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - USD ($) | Nov. 30, 2018 | Aug. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Accumulated depreciation on equipment (in dollars) | $ 344 | $ 282 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 50,000,000 | 50,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 14,230,020 | 14,002,293 |
Common stock, shares outstanding | 14,230,020 | 14,002,293 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Nov. 30, 2018 | Nov. 30, 2017 | |
OPERATING EXPENSES | ||
General and administrative | $ 205,501 | $ 136,564 |
Professional fees | 167,293 | 107,345 |
Research and development | 184,039 | 33,076 |
Depreciation | 70 | 72 |
Total Operating Expenses | 556,903 | 277,057 |
Loss from Operations | (556,903) | (277,057) |
Provision for income taxes | 0 | 0 |
NET LOSS | (556,903) | (277,057) |
OTHER COMPREHENSIVE LOSS | ||
Foreign currency translation adjustments | 4,888 | (1,025) |
Total Other Comprehensive Income Loss | 4,888 | (1,025) |
TOTAL COMPREHENSIVE LOSS | $ (552,015) | $ (278,082) |
Basic and Diluted Loss per Common Share (in dollars per share) | $ (0.04) | $ (0.02) |
Basic and Diluted Weighted Average Common Shares Outstanding (in shares) | 14,035,953 | 11,345,635 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Nov. 30, 2018 | Nov. 30, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net loss | $ (556,903) | $ (277,057) |
Stock based compensation | 41,051 | 17,251 |
Depreciation | 70 | 72 |
Changes in operating assets and liabilities: | ||
Prepaid expenses | (9,462) | (14,785) |
Other receivable | 18,665 | (767) |
Accounts payable and accrued liabilities | 105,427 | 105,397 |
Net cash used in operating activities | (401,152) | (169,889) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchase of equipment | (867) | |
Net cash used in investing activities | (867) | |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Issuance of common shares | 170,774 | |
Collection from stock subscription | 10,000 | |
Advance from related party | 3,686 | 9,951 |
Repayment to related party | (558) | (8,505) |
Net cash provided by financing activities | 173,902 | 11,446 |
Effects on changes in foreign exchange rate | 4,900 | (1,025) |
Net decrease in cash and cash equivalents | (222,350) | (160,335) |
Cash and cash equivalents - beginning of period | 337,424 | 572,775 |
Cash and cash equivalents - end of period | 115,074 | 412,440 |
Supplemental Cash Flow | ||
Cash paid for interest | 0 | 0 |
Cash paid for income taxes | $ 0 | $ 0 |
ORGANIZATION AND DESCRIPTION OF
ORGANIZATION AND DESCRIPTION OF BUSINESS | 3 Months Ended |
Nov. 30, 2018 | |
Organization And Description Of Business [Abstract] | |
ORGANIZATION AND DESCRIPTION OF BUSINESS | NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS ARTELO BIOSCIENCES, INC. (the “Company”) is a Nevada corporation incorporated on May 2, 2011. It is based in San Diego County, California. The accounting and reporting policies of the Company conform to accounting principles generally accepted (“GAAP”) in the United States of America, and the Company’s fiscal year end is August 31. Effective on February 10, 2017, the Company changed its name from “KNIGHT KNOX DEVELOPMENT CORP.,” to “REACTIVE MEDICAL INC.” On April 14, 2017, the Company changed its name from “REACTIVE MEDICAL INC.” to “ARTELO BIOSCIENCES, INC”. In May 2017, the Company registered fully owned subsidiaries in England and Wales, Trinity Reliant Ventures Limited, and Trinity Research & Development Limited. Operations in the subsidiaries have been consolidated in the financial statements. The Company intends to license, develop and commercialize novel therapeutic treatments targeting the endocannabinoid system. To date, the Company’s activities have primarily been limited to its formation, business development activities, sponsored research, and the raising of equity capital. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Nov. 30, 2018 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The Company prepares its financial statements in accordance with rules and regulations of the Securities and Exchange Commission (“SEC”) and GAAP in the United States of America. The accompanying interim financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information in accordance with Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the Company’s opinion, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended November 30, 2018 are not necessarily indicative of the results for the full year. While management of the Company believes that the disclosures presented herein are adequate and not misleading, these interim financial statements should be read in conjunction with the audited financial statements and the footnotes thereto for the year ended August 31, 2018 contained in the Company’s Form 10-K filed on November 29, 2018. Basis of Consolidation The financial statements have been prepared on a consolidated basis, with the Company’s fully owned subsidiary Trinity Reliant Ventures Limited. No intercompany balances or transactions exist during the period ended November 30, 2018. |
GOING CONCERN
GOING CONCERN | 3 Months Ended |
Nov. 30, 2018 | |
Going Concern [Abstract] | |
GOING CONCERN | NOTE 3 - GOING CONCERN The Company’s financial statements are prepared using GAAP in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not established an ongoing source of revenues sufficient to cover its operating cost and requires additional capital to commence its operating plan. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations. These factors raise substantial doubt about its ability to continue as a going concern. In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management’s plan to obtain such resources for the Company include: sales of equity instruments; traditional financing, such as loans; and obtaining capital from management and significant stockholders sufficient to meet its minimal operating expenses. However, management cannot provide any assurance that the Company will be successful in accomplishing any of its plans. There is no assurance that the Company will be able to obtain sufficient additional funds when needed or that such funds, if available, will be obtainable on terms satisfactory to the Company. In addition, profitability will ultimately depend upon the level of revenues received from business operations. However, there is no assurance that the Company will attain profitability. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. During the three months ended November 30, 2018, the Company had a net loss of $556,903. As at November 30, 2018, the Company had an accumulated deficit of $3,195,483 and has earned no revenues. The Company intends to fund operations through equity financing arrangements, which may be insufficient to fund its capital expenditures, working capital and other cash requirements for future periods. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Nov. 30, 2018 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 4 - RELATED PARTY TRANSACTIONS During the three months ended November 30, 2018, the president of the Company incurred $300 of expenses on behalf of the Company. The amount owed to the related party as of November 30, 2018 and August 31, 2018 is $2,502 and $2,202, respectively. The amounts are non-interest bearing and have no terms of repayment. During the three months ended November 30, 2018, the former President, and current Senior Vice President, European Operations, who is a major shareholder, paid for expenses on behalf of the Company for a total of $3,386. The amount of $558 was repaid during the three months ended November 30, 2018. The amount owed to the related party as of November 30, 2018 and August 31, 2018 is $3,326 and $498, respectively. The amounts are non-interest bearing, and have no terms of repayment. During the three months ended November 30, 2018, a company owned by the Senior Vice President, European Operations, who is a major shareholder, provided consulting services for $7,500. As of November 30, 2018, there is $2,500 outstanding. |
EQUITY
EQUITY | 3 Months Ended |
Nov. 30, 2018 | |
Equity [Abstract] | |
EQUITY | NOTE 5 - EQUITY Preferred shares The Company has authorized 50,000,000 shares of preferred stock with a par value of $0.001. During the three months ended November 30, 2018, there were no issuances of preferred stock. Common Shares The Company has authorized 150,000,000 common shares with a par value of $0.001 per share. Each common share entitles the holder to one vote, in person or proxy, on any matter on which action of the stockholders of the company is sought. During the three months ended November 30, 2018, the Company received cash of $170,774 that has been recorded for the issuance of 227,727 shares of common stock at a price of $0.75 per Unit pursuant to a private placement offering conducted by the Company in relation to subscription agreements accepted in October, 2018. Each Unit consists of: (i) one (1) share of common stock; and (ii) one (1) Series D Stock Purchase Warrant to purchase one (1) share of common stock at a price of $1.75 per share for a period of 5 years from the issue date. Warrants In relation to the common stock related to subscription agreements in fiscal year 2019, 2018 and 2017, each individual investor received warrants with the purchase of the stock. For each share purchased, the investor will receive one Series A, Series B, Series C or Series D Common Stock Purchase Warrant to purchase one share of the Company’s common stock for a period of five years from the date of the share subscription with ranges of prices from $1.00 per share to $1.75 per share. As of November 30, 2018, there are 4,190,020 Common Stock Purchase Warrants outstanding and exercisable, with a weighted average life remaining of 4.03 years, and weighted average exercise price of $1.32. The intrinsic value of the warrants as of November 30, 2018 is $156,184. Stock Options On August 17, 2018, the Company granted options to consultants to purchase an aggregate of 400,000 shares of our common stock at a price of $1.35 per share with various vesting schedules. The options expire on August 17, 2028, unless such consultant ceases his or her service as a consultant prior the exercise or expiration of the option. One consultant also serves as a director. During the three months ended November 30, 2018, $28,051 was expensed, and as of November 30, 2018, $401,468 remains unamortized. The intrinsic value of the 400,000 options as of November 30, 2018 is $0, and the weighted average value of the remaining life of the options is $9.72. During the three months ended November 30, 2018, the Company recorded $13,000 of stock compensation expense for five members of the Company’s Board of Directors. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Nov. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 6 – COMMITMENTS AND CONTENGENCIES The Company has certain financial commitments in relation to Research and Development contracts. As of November 30, 2018: · The Company is obligated to make two payments of $77,760 each on December 1, 2018, and March 1, 2019 for research and development. The December 1, 2018 payment has not yet been paid by the Company. · The Company is obligated to make a two semi-annual payments totaling 115,000 GBP over the next year. Payments of $57,500 GBP are obligated to be made on October 5, 2018, and April 5, 2019. The October 5, 2018 payment has not yet been paid by the Company. · The Company is invoiced monthly and quarterly in relation to several Research and Development contracts. · The Company may be obligated to make additional payments related to Research and Development contracts entered into, dependent on the progress and milestones achieved through the programs. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Nov. 30, 2018 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 7– SUBSEQUENT EVENTS Subsequent to November 30, 2018, the Company received cash of $789,500 that has been recorded for the issuance of 1,052,667 shares of common stock at a price of $0.75 per Unit pursuant to a private placement offering conducted by the Company in relation to subscription agreements accepted in October 2018. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Nov. 30, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The Company prepares its financial statements in accordance with rules and regulations of the Securities and Exchange Commission (“SEC”) and GAAP in the United States of America. The accompanying interim financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information in accordance with Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the Company’s opinion, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended November 30, 2018 are not necessarily indicative of the results for the full year. While management of the Company believes that the disclosures presented herein are adequate and not misleading, these interim financial statements should be read in conjunction with the audited financial statements and the footnotes thereto for the year ended August 31, 2018 contained in the Company’s Form 10-K filed on November 29, 2018. |
Basis of Consolidation | Basis of Consolidation The financial statements have been prepared on a consolidated basis, with the Company’s fully owned subsidiary Trinity Reliant Ventures Limited. No intercompany balances or transactions exist during the period ended November 30, 2018. |
GOING CONCERN (Detail Textuals)
GOING CONCERN (Detail Textuals) - USD ($) | 3 Months Ended | ||
Nov. 30, 2018 | Nov. 30, 2017 | Aug. 31, 2018 | |
Going Concern [Abstract] | |||
Net loss | $ (556,903) | $ (277,057) | |
Accumulated deficit | $ (3,195,483) | $ (2,638,580) |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Detail Textuals) - USD ($) | 3 Months Ended | ||
Nov. 30, 2018 | Nov. 30, 2017 | Aug. 31, 2018 | |
Related Party Transaction [Line Items] | |||
Advance from related party | $ 3,686 | $ 9,951 | |
Due to related party | 5,828 | $ 2,700 | |
Former President, and current Senior Vice President, European Operations | |||
Related Party Transaction [Line Items] | |||
Due to related party | 3,326 | 498 | |
Rent Expense paid on behalf of company | 3,386 | ||
Repayments to related party | 558 | ||
President | |||
Related Party Transaction [Line Items] | |||
Advance from related party | 300 | ||
Due to related party | 2,502 | $ 2,202 | |
Senior Vice President, European Operations | |||
Related Party Transaction [Line Items] | |||
Consulting services | 7,500 | ||
Outstanding consulting services | $ 2,500 |
EQUITY (Detail Textuals)
EQUITY (Detail Textuals) | 3 Months Ended | |
Nov. 30, 2018USD ($)Warrant$ / sharesshares | Aug. 31, 2018$ / sharesshares | |
Related Party Transaction [Line Items] | ||
Preferred stock, shares authorized | shares | 50,000,000 | 50,000,000 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares issued | shares | 0 | 0 |
Common stock, shares authorized | shares | 150,000,000 | 150,000,000 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock holder voting rights | Each common share entitles the holder to one vote, in person or proxy | |
Series A, B, C and D common stock purchase warrant | ||
Related Party Transaction [Line Items] | ||
Purchase warrants outstanding | $ | $ 4,190,020 | |
Warrant or right outstanding weighted average remaining life term | 4 years 11 days | |
Warrant intrinsic value | $ | $ 156,184 | |
Exercise price of warrants | $ 1.32 | |
Number of warrant purchase | Warrant | 1 | |
Number of purchase common stock shares | Warrant | 1 | |
Terms of common stock warrant | 5 years | |
Series A, B, C and D common stock purchase warrant | Minimum | ||
Related Party Transaction [Line Items] | ||
Exercise price of warrants | $ 1 | |
Series A, B, C and D common stock purchase warrant | Maximum | ||
Related Party Transaction [Line Items] | ||
Exercise price of warrants | $ 1.75 | |
Subscription Agreement | Private placement | ||
Related Party Transaction [Line Items] | ||
Number of issuance of common shares | shares | 227,727 | |
Value for issuance of common shares | $ | $ 170,774 | |
Share price | $ 0.75 | |
Subscription Agreement | Series D Common Stock Purchase Warrant | ||
Related Party Transaction [Line Items] | ||
Exercise price of warrants | $ 1.75 | |
Number of warrant purchase | Warrant | 1 | |
Number of purchase common stock shares | Warrant | 1 | |
Terms of common stock warrant | 5 years |
EQUITY (Detail Textuals 1)
EQUITY (Detail Textuals 1) - USD ($) | 1 Months Ended | 3 Months Ended |
Aug. 17, 2018 | Nov. 30, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock based compensation | $ 13,000 | |
Equity Incentive Plan 2018 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Remains unamortized stock base expenses | 401,468 | |
Stock based compensation | $ 28,051 | |
Number of shares granted during period | 400,000 | |
Intrinsic value | $ 0 | |
Value of the remaining life of the options | $ 9.72 | |
Equity Incentive Plan 2018 | Director and consultants | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Exercise price | $ 1.35 | |
Number of shares granted during period | 400,000 | |
Expiration date under plan | Aug. 17, 2028 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Detail Textuals) - 3 months ended Nov. 30, 2018 - Research and Development Contracts | USD ($) | GBP (£) |
Long-term Purchase Commitment [Line Items] | ||
Total semi annual payments | £ 115,000 | |
December 1, 2018 | ||
Long-term Purchase Commitment [Line Items] | ||
Payment for research and development | $ | $ 77,760 | |
March 1, 2019 | ||
Long-term Purchase Commitment [Line Items] | ||
Payment for research and development | $ | $ 77,760 | |
October 5, 2018 | ||
Long-term Purchase Commitment [Line Items] | ||
Total semi annual payments | 57,500 | |
April 5, 2019 | ||
Long-term Purchase Commitment [Line Items] | ||
Total semi annual payments | £ 57,500 |
SUBSEQUENT EVENTS (Detail Textu
SUBSEQUENT EVENTS (Detail Textuals) - Subsequent event - Subscription Agreement | Jan. 14, 2019USD ($)$ / sharesshares |
Subsequent Event [Line Items] | |
Common shares issued for cash | $ | $ 789,500 |
Number of issuance of common shares | shares | 1,052,667 |
Share price | $ / shares | $ 0.75 |