Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | May 15, 2019 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Healthier Choices Management Corp. | |
Entity Central Index Key | 0000844856 | |
Trading Symbol | HCMC | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Ex Transition Period | false | |
Entity Common Stock, Shares Outstanding | 66,645,257,694 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 5,994,672 | $ 7,061,253 |
Accounts receivable, net | 39,964 | 51,951 |
Inventories | 1,926,027 | 1,864,619 |
Prepaid expenses and vendor deposits | 443,658 | 402,578 |
Investment | 65,143 | 90,857 |
Contract assets | 18,000 | 32,400 |
TOTAL CURRENT ASSETS | 8,487,464 | 9,503,658 |
Property and equipment, net of accumulated depreciation | 425,210 | 497,039 |
Intangible assets, net of accumulated amortization | 2,216,872 | 3,062,204 |
Goodwill | 1,437,314 | 1,437,314 |
Note receivable | 486,534 | 528,007 |
Right of use asset - operating lease, net | 4,825,446 | |
Other assets | 143,602 | 144,441 |
TOTAL ASSETS | 18,022,442 | 15,172,663 |
CURRENT LIABILITIES | ||
Accounts payable and accrued expenses | 1,296,407 | 1,301,418 |
Contract liabilities | 240,702 | 442,630 |
Operating lease liability, current | 525,120 | |
Loan payable, current | 282,254 | 282,224 |
Credit line | 1,868,460 | 1,868,460 |
Derivative liabilities - warrants | 1,722,478 | 1,722,928 |
TOTAL CURRENT LIABILITIES | 5,935,421 | 5,617,660 |
Loan payable, net of current portion | 1,080,993 | 1,128,234 |
Operating lease liability, net of current | 3,681,274 | |
TOTAL LIABILITIES | 10,697,688 | 6,745,894 |
COMMITMENTS AND CONTINGENCIES (SEE NOTE 10) | ||
STOCKHOLDERS' EQUITY | ||
Series B convertible preferred stock, $1,000 par value per share, 30,000 shares authorized; 20,150 shares issued and outstanding as of March 31, 2019 and December 31, 2018; aggregate liquidation preference of $20.2 million | 20,150,116 | 20,150,116 |
Common Stock, $0.0001 par value per share, 750,000,000,000 shares authorized; 66,634,387,066 and 66,623,514,522 shares issued and outstanding as of March 31, 2019 and December 31, 2018, respectively | 6,663,438 | 6,662,351 |
Additional paid-in capital | 7,460,832 | 7,348,390 |
Accumulated deficit | (26,949,632) | (25,734,088) |
TOTAL STOCKHOLDERS' EQUITY | 7,324,754 | 8,426,769 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 18,022,442 | $ 15,172,663 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 750,000,000,000 | 750,000,000,000 |
Common stock, shares issued | 66,634,387,066 | 66,623,514,522 |
Common stock, shares outstanding | 66,634,387,066 | 66,623,514,522 |
Series B convertible preferred stock, par value | $ 1,000 | $ 1,000 |
Series B convertible preferred stock, shares authorized | 30,000 | 30,000 |
Series B convertible preferred stock, shares issued | 20,150 | 20,150 |
Series B convertible preferred stock, shares outstanding | 20,150 | 20,150 |
Series B convertible preferred stock aggregate liquidation preference | $ 20,200,000 | $ 20,200,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
SALES | ||
Vapor sales, net | $ 1,224,042 | $ 1,308,895 |
Grocery sales, net | 3,156,064 | 2,298,511 |
TOTAL SALES, NET | 4,380,106 | 3,607,406 |
Cost of sales vapor | 509,416 | 576,661 |
Cost of sales grocery | 1,967,796 | 1,386,278 |
GROSS PROFIT | 1,902,894 | 1,644,467 |
OPERATING EXPENSES | ||
Advertising | 44,374 | 37,763 |
Selling, general and administrative | 2,946,081 | 3,097,728 |
Total operating expenses | 2,990,455 | 3,135,491 |
LOSS FROM OPERATIONS | (1,087,561) | (1,491,024) |
OTHER INCOME (EXPENSE) | ||
Loss on investment | (25,713) | |
Other income (expense), net | (693) | 210,000 |
Interest income (expense), net | 1,438 | 11,388 |
Total other income (expense), net | (24,968) | 221,388 |
NET LOSS | $ (1,112,529) | $ (1,269,636) |
NET LOSS PER SHARE -BASIC AND DILUTED | $ 0 | $ 0 |
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING-BASIC AND DILUTED | 66,624,914,548 | 29,348,867,108 |
Condensed Consolidated Statem_2
Condensed Consolidated Statement of Changes in Stockholders' Equity (Unaudited) - USD ($) | Convertible Preferred Stock | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Total |
Beginning balance at Dec. 31, 2017 | $ 2,934,887 | $ 10,080,238 | $ (12,570,827) | $ 444,298 | |
Beginning balance, Shares at Dec. 31, 2017 | 29,348,867,108 | ||||
Stock-based compensation expense | 1,071,890 | 1,071,890 | |||
Net loss | (1,269,636) | (1,269,636) | |||
Ending balance at Mar. 31, 2018 | $ 2,934,887 | 11,152,128 | (13,840,463) | 246,552 | |
Ending balance, Shares at Mar. 31, 2018 | 29,348,867,108 | ||||
Beginning balance at Dec. 31, 2018 | $ 20,150,116 | $ 6,662,351 | 7,348,390 | (25,734,088) | 8,426,769 |
Beginning balance, Shares at Dec. 31, 2018 | 20,150 | 66,623,514,522 | |||
Issuance of common stock in connection with cashless exercise of Series A warrants | $ 1,087 | (637) | 450 | ||
Issuance of common stock in connection with cashless exercise of Series A warrants, Shares | 10,872,544 | ||||
Stock-based compensation expense | 113,079 | 113,079 | |||
Cumulative Effect on adoption of ASC 842 | (103,015) | (103,015) | |||
Net loss | (1,112,529) | (1,112,529) | |||
Ending balance at Mar. 31, 2019 | $ 20,150,116 | $ 6,663,438 | $ 7,460,832 | $ (26,949,632) | $ 7,324,754 |
Ending balance, Shares at Mar. 31, 2019 | 20,150 | 66,634,387,066 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
OPERATING ACTIVITIES | ||
Net loss | $ (1,112,529) | $ (1,269,636) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Change in allowances for bad debt | (3,002) | 12,695 |
Depreciation and amortization | 152,314 | 87,546 |
Loss on disposal of assets | 25,427 | |
Loss on investment | 25,713 | |
Amortization of right-of-use asset | 162,782 | |
Stock-based compensation expense | 113,079 | 1,071,890 |
Changes in operating assets and liabilities: | ||
Due from merchant credit card processors | 15,615 | |
Accounts receivable | 14,989 | 16,364 |
Inventories | (61,407) | (123,861) |
Prepaid expenses and vendor deposits | (43,276) | (7,746) |
Contract assets | 14,400 | |
Other assets | 839 | 2,763 |
Accounts payable | 247,299 | (50,062) |
Accrued expenses | (252,310) | 25,823 |
Contract liabilities | (201,928) | (2,446) |
Lease liability | (143,233) | |
NET CASH USED IN OPERATING ACTIVITIES | (1,060,843) | (221,055) |
INVESTING ACTIVITIES | ||
Collection of note receivable | 41,473 | |
Purchases of property and equipment | (2,600) | |
NET CASH PROVIDED BY INVESTING ACTIVITIES | 41,473 | (2,600) |
FINANCING ACTIVITIES | ||
Principal payments on loan payable | (47,211) | (517) |
NET CASH USED IN FINANCING ACTIVITIES | (47,211) | (517) |
DECREASE IN CASH | (1,066,581) | (224,172) |
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD | 7,061,253 | 7,883,191 |
CASH AND CASH EQUIVALENTS - END OF PERIOD | 5,994,672 | 7,659,019 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||
Cash paid for interest | 30,052 | 204 |
NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
Issuance of common stock in connection with cashless exercise of Series A warrants | $ 450 |
Organization, Going Concern, an
Organization, Going Concern, and Basis of Presentation | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION, GOING CONCERN, AND BASIS OF PRESENTATION | Note 1. ORGANIZATION, GOING CONCERN, AND BASIS OF PRESENTATION Organization Healthier Choices Management Corp. (the "Company") is a holding company focused on providing consumers with healthier daily choices with respect to nutrition and other lifestyle alternatives. The Company currently operates ten retail vape stores in the Southeast region of the United States, through which it offers e-liquids, vaporizers and related products. The Company also operates Ada's Natural Market, a natural and organic grocery store, through its wholly owned subsidiary Healthy Choice Markets, Inc. and Paradise Health and Nutrition, stores that offer fresh produce, bulk foods, vitamins and supplements, packaged groceries, meat and seafood, deli, baked goods, dairy products, frozen foods, health & beauty products and natural household items through its wholly owned subsidiary Healthy Choice Markets 2, LLC. The Company also sells vitamins and supplements on the Amazon.com marketplace through its wholly owned subsidiary Healthy U Wholesale, Inc. The Company markets the Q-Cup™ technology under the vape segment; this patented technology is based on a small, quartz cup called the Q-Cup™, which a customer partially fills with either cannabis or CBD concentrate (approximately 50mg) purchased from a third party. The Q-Cup™ is then inserted into the Q-Cup™ Tank or Globe, that heats the cup from the outside without coming in direct contact with the solid concentrate. This Q-Cup™ technology provides significantly more efficiency and an "on the go" solution for consumers who prefer to vape concentrates either medicinally or recreationally. Liquidity The accompanying condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP"), which contemplate continuation of the Company as a going concern and realization of assets and satisfaction of liabilities in the normal course of business and do not include any adjustments that might result from the outcome of any uncertainties related to our going concern assessment. The carrying amounts of assets and liabilities presented in the financial statements do not necessarily purport to represent realizable or settlement values. The Company incurred a loss from operations of approximately $0.9 million for the three months ended March 31, 2019. As of March 31, 2019, cash and cash equivalents totaled approximately $6.0 million. While we anticipate that our current cash, cash equivalents, and cash to be generated from operations will be sufficient to meet our projected operating plans for the foreseeable future through a year and a day from the issuance of these unaudited condensed consolidated financial statements, should we require additional funds (either through equity or debt financings, collaborative agreements or from other sources) we have no commitments to obtain such additional financing, and we may not be able to obtain any such additional financing on terms favorable to us, or at all. Sourcing and Vendors We source from multiple suppliers. These suppliers range from small independent businesses to multinational conglomerates. For the three months ended March 31, 2019, we purchased approximately 66% of the goods we sell from our top 20 suppliers and approximately 19% of our total purchases were from one vendor. Basis of Presentation and Principles of Consolidation The Company's unaudited condensed consolidated financial statements are prepared in accordance with GAAP. The unaudited condensed consolidated financial statements include the accounts of all subsidiaries in which the Company holds a controlling financial interest as of the financial statement date. The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Healthy Choice Markets, Inc., Healthy Choice Markets 2, LLC ("Paradise Health and Nutrition"), The Vitamin Store, LLC, Healthy U Wholesale, Inc., The Vape Store, Inc. ("Vape Store"), Vaporin, Inc. ("Vaporin"), Smoke Anywhere U.S.A., Inc. ("Smoke"), Emagine the Vape Store, LLC ("Emagine"), IVGI Acquisition, Inc., Vapormax Franchising LLC, Vaporin LLC, and Vaporin Florida, Inc. All intercompany accounts and transactions have been eliminated in consolidation. Unaudited Interim Financial Information The unaudited condensed consolidated financial statements have been prepared by the Company and reflect all normal, recurring adjustments that, in the opinion of management, are necessary for a fair presentation of the interim financial information. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for any subsequent quarter or for the year ending December 31, 2019. Certain information and footnotes normally included in financial statements prepared in accordance with GAAP have been omitted under the instructions to Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange Commission ("SEC"). These unaudited condensed consolidated financial statements and notes included herein should be read in conjunction with the audited consolidated financial statements and related notes thereto as of and for the year ended December 31, 2018 included in the Company's Annual Report on Form 10-K for such year as filed with the SEC on March 27, 2019. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use of Estimates in the Preparation of the Financial Statements The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, and the reported amounts of net revenue and expenses during the reporting periods. Actual results could differ from those estimates. These estimates and assumptions include allowances, reserves and write-downs of receivables and inventory, valuing equity securities and hybrid instruments, share-based payment arrangements, deferred taxes and related valuation allowances, and the valuation of the assets and liabilities acquired in business combinations. Certain of management's estimates could be affected by external conditions, including those unique to our industry, and general economic conditions. It is possible that these external factors could have an effect on our estimates that could cause actual results to differ from our estimates. The Company re-evaluates all of its accounting estimates at least quarterly based on these conditions and records adjustments when necessary. Adopted Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, "Leases (Topic 842)" ("ASU 2016-02"). ASU 2016-02 establishes a right-of-use ("ROU") model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. ASU 2016-02 is effective for annual periods beginning after December 15, 2018, and annual and interim periods thereafter, with early adoption permitted. The Company adopted ASU No. 2016-02 on January 1, 2019 using the cumulative-effect adjustment transition method, which applies the provisions of the standard at the effective date without adjusting the comparative periods presented. Adoption of this standard resulted in the recognition of operating lease right-of-use assets of $4,988,000 and corresponding lease liabilities of $4,350,000 on the consolidated balance sheet as of January 1, 2019. An adjustment to Ada's favorable lease of $739,000 and prepaid rent of $2,000, resulted in a cumulative effect adjustment of $103,000. The standard did not materially impact operating results or liquidity. Disclosures related to the amount, timing and uncertainty of cash flows arising from leases are included in Note 11, Leases. |
Concentration of Risk
Concentration of Risk | 3 Months Ended |
Mar. 31, 2019 | |
Risks and Uncertainties [Abstract] | |
CONCENTRATION OF RISK | Note 3. CONCENTRATION OF RISK Cash Our cash balances are kept liquid to support our growing acquisition and infrastructure needs for operational expansion. The majority of the Company's cash and cash equivalents are concentrated in one large financial institution, which is in excess of Federal Deposit Insurance Corporation (FDIC) coverage. A summary of the financial institutions that had a cash and cash equivalents in excess of FDIC limits of $250,000 at March 31, 2019 and December 31, 2018 is presented below: March 31, December 31, Total Cash in excess of FDIC limits of $250,000 $ 4,776,000 $ 6,039,000 The Company continually monitors its positions with, and the credit quality of, the financial institutions with which it invests, as deposits are held in excess of federally insured limits. The Company has not experienced any losses in such accounts. Accounts Receivable Concentration of accounts receivable consist of the following, all of which are greater than 10% of the total net accounts receivable balance: March 31, December 31, Customers balances in excess of 10% of total accounts receivable Customer A 13 % 55 % Customer B 12 % - % |
Disaggregation of Revenues
Disaggregation of Revenues | 3 Months Ended |
Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
DISAGGREGATION OF REVENUES | Note 4. DISAGGREGATION OF REVENUES The Company reports the following segments in accordance with management guidance: Vapor and Grocery. When the Company prepares its internal management reporting to evaluate business performance, we disaggregate revenue into the following categories that depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. Three Months Ended March 31, March 31, Vapor $ 1,224,042 $ 1,308,895 Grocery 3,156,064 2,298,511 Total revenue $ 4,380,106 $ 3,607,406 Retail Vapor $ 1,223,722 $ 1,302,855 Retail Grocery 2,753,199 1,646,635 Food service/restaurant 347,651 397,564 Online/eCommerce 46,569 250,960 Wholesale Grocery 8,645 3,352 Wholesale Vapor 320 6,040 Total revenue $ 4,380,106 $ 3,607,406 |
Intangible Assets
Intangible Assets | 3 Months Ended |
Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS | Note 5. INTANGIBLE ASSETS Intangible assets, net are as follows: March 31, 2019 Useful Lives Gross Accumulated Net Trade names 8-10 years 993,000 (277,796 ) 715,204 Customer relationships 4-10 years 1,228,000 (104,073 ) 1,123,927 Patents 10 years 245,250 (29,071 ) 216,179 Non-compete 4 years 174,000 (12,688 ) 161,312 Website 3 years 4,500 (4,250 ) 250 Intangible assets, net $ 2,644,750 $ (427,878 ) $ 2,216,872 December 31, 2018 Useful Life Gross Carrying Amount Accumulated Amortization Net Carrying Amount Favorable lease 15 years $ 890,000 $ (150,580 ) $ 739,420 Trade names 8-10 years 993,000 (252,329 ) 740,671 Customer relationships 4-10 years 1,228,000 (41,010 ) 1,186,990 Patents 10 years 245,250 (22,940 ) 222,310 Non-compete 4 years 174,000 (1,812 ) 172,188 Website 3 years 4,500 (3,875 ) 625 Intangible assets, net $ 3,534,750 $ (472,546 ) $ 3,062,204 Intangible assets are amortized on a straight-line basis over their estimated useful lives. Amortization expense amounted to approximately $106,000 and $40,000 for the three months ended March 31, 2019 and 2018, respectively. Due to adoption of ASU No. 2016-02 on January 1, 2019, the Company's favorable lease intangible asset associated with its Ada's Natural Market location, with a net balance of $739,000 as of December 31, 2018, was reclassified to right-of-use asset in the Ada's lease amortization schedule to correct the January 1, 2019 opening balance sheet. Future annual estimated amortization expense is as follows: Years ending December 31, 2019 (remaining nine months) $ 316,862 2020 422,150 2021 415,150 2022 399,765 2023 159,465 Thereafter 503,480 Total $ 2,216,872 |
Investment
Investment | 3 Months Ended |
Mar. 31, 2019 | |
Payables and Accruals [Abstract] | |
INVESTMENT | Note 6. INVESTMENT As of March 31, 2019, the Company held 85,714 common stock shares at MJ Holdings Inc. ("MJNE"), and remeasured the fair value of the MJNE stock and recognized a loss on investment of $26,000. The investment in MJNE stock is categorized as Level 1 asset and its fair value is based on quoted prices in active markets. A summary of the investment as of March 31, 2019 and December 31, 2018 are presented below: Fair Value Measurements Using Quoted Prices in Active Market Mark to March 31, 2019 (Level 1) Market Final MJ Holdings, Inc $ 150,000 $ (84,857 ) $ 65,143 Fair Value Measurements Using Quoted Prices in Active Market Mark to December 31, 2018 (Level 1) Market Final MJ Holdings, Inc $ 150,000 $ (59,143 ) $ 90,857 |
Contract Assets and Contract Li
Contract Assets and Contract Liabilities | 3 Months Ended |
Mar. 31, 2019 | |
Contract Assets and Liabilities [Abstract] | |
CONTRACT ASSETS AND CONTRACT LIABILITIES | Note 7. CONTRACT ASSETS AND CONTRACT LIABILITIES The Company's contract assets consist of sales commissions to third parties that support and facilitate the completion of complex transactions, for which the Company has a performance obligation to pay due to the fact that the sales agreement was fully executed. The contract assets balance as of March 31, 2019 is approximately $18,000. The Company's deferred revenue consists of gift cards and loyalty rewards, for which the Company has a performance obligation to deliver products when customers redeem balances or terms expire through breakage. Our breakage policy is twenty-four months for gift cards, twelve months for Grocery loyalty rewards, and six months for Vapor loyalty rewards. As such, all contract liabilities are expected to be recognized within a twenty-four month period. A summary of the contract liabilities activity for the three months ended March 31, 2019 and 2018 is presented below: March 31, March 31, Beginning balance as January1, $ 442,630 $ 61,312 Issued 74,894 83,834 Redeemed (74,387 ) (85,357 ) Breakage recognized (648 ) (923 ) Customer deposits (201,787 ) - Ending balance as of March 31, $ 240,702 $ 58,866 |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
STOCKHOLDERS' EQUITY | Note 8. STOCKHOLDERS' EQUITY Series A Warrants A summary of warrant activity for the three months ended March 31, 2019 is presented below: Exercise Price Warrant Common Stock Equivalent Remaining Contractual Term Outstanding at January 1, 2019 $ 0.0001 41,642,670,772 1.50 Warrants settlement $ - - Cashless exercises for common stock $ (0.0001 ) (10,872,544 ) Black Scholes Value adjustment $ (0.0001 ) (52,882,261 ) Outstanding at March 31, 2019 $ 0.0001 41,578,915,967 1.25 Pursuant to the Series A Warrant agreement, the Black Scholes value is calculated by a third-party and utilized in calculating the warrant common stock equivalents at the point of cashless exercise. As such, the value is computed at the end of each reporting period to determine the amount of warrant common stock equivalents outstanding using the formula below: (Series A Warrants exercised * Black Scholes Value) / closing common stock bid price as of two trading days prior. A summary of the outstanding warrant common stock equivalents at December 31, 2018 and March 31, 2019 is presented below: March 31, December 31, Warrants outstanding (A) 2.7341 2.7348 Black Scholes value (B) $ 1,520,758 $ 1,522,692 Subtotal (C)=(A) x (B) 4,157,904 4,164,258 Closing bid stock price (D) $ 0.0001 $ 0.0001 Warrant common stock equivalent (C)/(D) 41,579,000,000 41,643,000,000 Stock Options During the three months ended March 31, 2019 and 2018, the Company recognized stock-based compensation of approximately $0.1 million and $1.1 million, respectively, in connection with the amortization of stock options, net of recovery of stock-based charges for forfeited unvested stock options. Stock-based compensation expense is included as part of selling, general and administrative expense in the accompanying consolidated statements of operations. At March 31, 2019, the amount of unamortized stock-based compensation expense associated with unvested stock options granted to employees, directors and consultants was approximately $0.1 million, which will be amortized over a weighted average period of 1.3 years. Loss per Share Basic loss per share is computed by dividing the net loss by the weighted average number of shares of common stock outstanding during the period. Diluted loss per share is computed using the weighted average number of shares of common stock outstanding and, if dilutive, potential shares of common stock outstanding during the period. Potential common shares consist of incremental shares of common stock issuable upon (a) the exercise of stock options (using the treasury stock method); (b) the conversion of Series A convertible preferred stock; (c) the exercise of warrants (using the if-converted method); (d) the vesting of restricted stock units; and (e) the conversion of convertible notes payable. Diluted income (loss) per share excludes the potential common shares, as their effect is antidilutive. The following table summarizes the Company's securities, in common share equivalents, that have been excluded from the calculation of dilutive loss per share as their effect would be anti-dilutive: March 31, 2019 2018 Preferred stock 201,501,142,000 - Stock options 90,012,230,680 89,268,899,200 Warrants 41,578,915,967 505,888,354,828 Total 333,092,288,647 595,157,254,028 |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | Note 9. FAIR VALUE MEASUREMENTS The fair value framework under FASB's guidance requires the categorization of assets and liabilities into three levels based upon the assumptions used to measure the assets or liabilities. Level 1 provides the most reliable measure of fair value, whereas Level 3, if applicable, would generally require significant management judgment. The three levels for categorizing assets and liabilities under the fair value measurement requirements are as follows: ● Level 1: Fair value measurement of the asset or liability using observable inputs such as quoted prices in active markets for identical assets or liabilities; ● Level 2: Fair value measurement of the asset or liability using inputs other than quoted prices that are observable for the applicable asset or liability, either directly or indirectly, such as quoted prices for similar (as opposed to identical) assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active; and ● Level 3: Fair value measurement of the asset or liability using unobservable inputs that reflect the Company's own assumptions regarding the applicable asset or liability. Nonfinancial assets such as goodwill, other intangible assets, and long-lived assets held and used are measured at fair value and tested for impairment annually, or when there is an indicator of impairment between annual tests. The following table summarizes the liabilities measured at fair value on a recurring basis as of March 31, 2019: Level 1 Level 2 Level 3 Total LIABILITIES Derivative liabilities - warrants $ - $ 1,722,478 $ - $ 1,722,478 Total derivative liabilities - warrants $ - $ 1,722,478 $ - $ 1,722,478 The following table summarizes the liabilities measured at fair value on a recurring basis as of December 31, 2018: Level 1 Level 2 Level 3 Total LIABILITIES Derivative liabilities – warrants $ - $ 1,722,928 $ - $ 1,722,928 Total derivative liabilities – warrants $ - $ 1,722,928 $ - $ 1,722,928 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | Note 10. COMMITMENTS AND CONTINGENCIES Legal Proceedings From time to time the Company may be involved in various claims and legal actions arising in the ordinary course of our business. With respect to legal costs, we record such costs as incurred. A subsidiary of the Company is a defendant in a lawsuit that stems from a purported defect and negligence concerning electronic cigarette products it sold. The action was filed on January 31, 2019 in Florida state court in Broward County, Florida. Plaintiff is seeking damages for his physical injuries as well as his pain and suffering. Plaintiff claims that he was injured by a vape battery explosion that occurred in his pocket on or about September 2017 and that he purchased the battery from a store operated by the Company's subsidiary. While discovery is at its infancy, the Company intends to vigorously dispute these claims that have been asserted against it. |
Lease
Lease | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
LEASE | Note 11. LEASE The Company has various lease agreements with terms up to 20 years, including leases of retail stores, headquarter and equipment. All the leases are classified as operating leases. The Company adopted Accounting Standards Codification ("ASC") 842, "Leases" ("ASC 842") effective January 1, 2019 using the cumulative-effect adjustment transition method, which applies the provisions of the standard at the effective date without adjusting the comparative periods presented. We elected not to reassess whether any expired or existing contracts are or contain leases, reassess the lease classification for any expired or existing leases, nor reassess initial direct costs for any existing leases. The standard had an impact on the Company's condensed consolidated balance sheets, but did not have a material impact on the Company's condensed consolidated statements of operations or condensed consolidated statements of cash flows upon adoption. The most significant impact was the recognition of right-of-use asset of $5.0 million and lease liability of $4.3 million for operating leases as of January 1, 2019. The following table presents information about the amount, timing and uncertainty of cash flows arising from the Company's operating leases as of March 31, 2019. Maturity of Lease Liabilities By Fiscal Year 2019 (remaining) $ 552,492 2020 621,435 2021 495,154 2022 455,916 2023 441,262 Thereafter 2,888,699 Total undiscounted operating lease payments $ 5,454,958 Less: Imputed interest (1,248,564 ) Present value of operating lease liabilities $ 4,206,394 Balance Sheet Classification Operating lease liability, current $ 525,120 Operating lease liability, net of current 3,681,274 Total operating lease liabilities $ 4,206,394 Other Information Weighted-average remaining lease term for operating leases 11 years Weighted-average discount rate for operating leases 4.8 % Components of lease cost are as follows: 3/31/2019 Operating lease cost $ 127,144 Variable lease cost 75,405 Short-term lease cost 35,638 Total Rent Expense $ 238,187 Cash Flows Cash paid for amounts included in the present value of operating lease liabilities was $143,000 during first quarter 2019 and was included in operating cash flows. The amortization of the right-of-use asset of $163,000 was included in operating cash flows. Supplemental balance sheet information related to our operating leases is as follows: Balance Sheet Classification 1/1/2019 3/31/2019 Right of use asset Other assets $ 4,988,227 $ 4,825,446 Lease liability, current Current liabilities $ 553,316 $ 525,120 Lease liability, net of current Other liabilities $ 3,796,312 $ 3,681,274 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2019 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | Note 12. SUBSEQUENT EVENTS On April 13, 2018, the Company agreed to a new revolving credit line of $2 million and a money market account of $2 million ("blocked account") with Professional Bank in Coral Gables, Florida. On April 22, 2019, the Company reached agreement with Professional Bank to renew the credit line for one more year, and the next annual review will occur on or before May 13, 2020. All terms, conditions and provisions of the Note and each of the other loan documents, are ratified, confirmed and continue unchanged in full force and effect. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Use of Estimates in the Preparation of the Financial Statements | Use of Estimates in the Preparation of the Financial Statements The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, and the reported amounts of net revenue and expenses during the reporting periods. Actual results could differ from those estimates. These estimates and assumptions include allowances, reserves and write-downs of receivables and inventory, valuing equity securities and hybrid instruments, share-based payment arrangements, deferred taxes and related valuation allowances, and the valuation of the assets and liabilities acquired in business combinations. Certain of management's estimates could be affected by external conditions, including those unique to our industry, and general economic conditions. It is possible that these external factors could have an effect on our estimates that could cause actual results to differ from our estimates. The Company re-evaluates all of its accounting estimates at least quarterly based on these conditions and records adjustments when necessary. |
Adopted Accounting Pronouncements | Adopted Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, "Leases (Topic 842)" ("ASU 2016-02"). ASU 2016-02 establishes a right-of-use ("ROU") model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. ASU 2016-02 is effective for annual periods beginning after December 15, 2018, and annual and interim periods thereafter, with early adoption permitted. The Company adopted ASU No. 2016-02 on January 1, 2019 using the cumulative-effect adjustment transition method, which applies the provisions of the standard at the effective date without adjusting the comparative periods presented. Adoption of this standard resulted in the recognition of operating lease right-of-use assets of $4,988,000 and corresponding lease liabilities of $4,350,000 on the consolidated balance sheet as of January 1, 2019. An adjustment to Ada's favorable lease of $739,000 and prepaid rent of $2,000, resulted in a cumulative effect adjustment of $103,000. The standard did not materially impact operating results or liquidity. Disclosures related to the amount, timing and uncertainty of cash flows arising from leases are included in Note 11, Leases. |
Concentration of Risk (Tables)
Concentration of Risk (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Risks and Uncertainties [Abstract] | |
Schedules of concentration of risk by cash and cash equivalents | March 31, December 31, Total Cash in excess of FDIC limits of $250,000 $ 4,776,000 $ 6,039,000 |
Schedule of concentration of accounts receivable | March 31, December 31, Customers balances in excess of 10% of total accounts receivable Customer A 13 % 55 % Customer B 12 % - % |
Disaggregation of Revenues (Tab
Disaggregation of Revenues (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of disaggregate revenue | Three Months Ended March 31, March 31, Vapor $ 1,224,042 $ 1,308,895 Grocery 3,156,064 2,298,511 Total revenue $ 4,380,106 $ 3,607,406 Retail Vapor $ 1,223,722 $ 1,302,855 Retail Grocery 2,753,199 1,646,635 Food service/restaurant 347,651 397,564 Online/eCommerce 46,569 250,960 Wholesale Grocery 8,645 3,352 Wholesale Vapor 320 6,040 Total revenue $ 4,380,106 $ 3,607,406 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets | March 31, 2019 Useful Lives Gross Accumulated Net Trade names 8-10 years 993,000 (277,796 ) 715,204 Customer relationships 4-10 years 1,228,000 (104,073 ) 1,123,927 Patents 10 years 245,250 (29,071 ) 216,179 Non-compete 4 years 174,000 (12,688 ) 161,312 Website 3 years 4,500 (4,250 ) 250 Intangible assets, net $ 2,644,750 $ (427,878 ) $ 2,216,872 December 31, 2018 Useful Life Gross Carrying Amount Accumulated Amortization Net Carrying Amount Favorable lease 15 years $ 890,000 $ (150,580 ) $ 739,420 Trade names 8-10 years 993,000 (252,329 ) 740,671 Customer relationships 4-10 years 1,228,000 (41,010 ) 1,186,990 Patents 10 years 245,250 (22,940 ) 222,310 Non-compete 4 years 174,000 (1,812 ) 172,188 Website 3 years 4,500 (3,875 ) 625 Intangible assets, net $ 3,534,750 $ (472,546 ) $ 3,062,204 |
Schedule of estimated future amortization of the intangible assets | Years ending December 31, 2019 (remaining nine months) $ 316,862 2020 422,150 2021 415,150 2022 399,765 2023 159,465 Thereafter 503,480 Total $ 2,216,872 |
Investment (Tables)
Investment (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Payables and Accruals [Abstract] | |
Schedule of investments | Fair Value Measurements Using Quoted Prices in Active Market Mark to March 31, 2019 (Level 1) Market Final MJ Holdings, Inc $ 150,000 $ (84,857 ) $ 65,143 Fair Value Measurements Using Quoted Prices in Active Market Mark to December 31, 2018 (Level 1) Market Final MJ Holdings, Inc $ 150,000 $ (59,143 ) $ 90,857 |
Contract Assets and Contract _2
Contract Assets and Contract Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Contract Assets and Liabilities [Abstract] | |
Schedule of contract liabilities | March 31, March 31, Beginning balance as January1, $ 442,630 $ 61,312 Issued 74,894 83,834 Redeemed (74,387 ) (85,357 ) Breakage recognized (648 ) (923 ) Customer deposits (201,787 ) - Ending balance as of March 31, $ 240,702 $ 58,866 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Schedule of warrant activity | Exercise Price Warrant Common Stock Equivalent Remaining Contractual Term Outstanding at January 1, 2019 $ 0.0001 41,642,670,772 1.50 Warrants settlement $ - - Cashless exercises for common stock $ (0.0001 ) (10,872,544 ) Black Scholes Value adjustment $ (0.0001 ) (52,882,261 ) Outstanding at March 31, 2019 $ 0.0001 41,578,915,967 1.25 |
Schedule of the outstanding warrant common stock equivalents | March 31, December 31, Warrants outstanding (A) 2.7341 2.7348 Black Scholes value (B) $ 1,520,758 $ 1,522,692 Subtotal (C)=(A) x (B) 4,157,904 4,164,258 Closing bid stock price (D) $ 0.0001 $ 0.0001 Warrant common stock equivalent (C)/(D) 41,579,000,000 41,643,000,000 |
Schedule of anti-dilutive activities excluded from basic and dilutive loss per share | March 31, 2019 2018 Preferred stock 201,501,142,000 - Stock options 90,012,230,680 89,268,899,200 Warrants 41,578,915,967 505,888,354,828 Total 333,092,288,647 595,157,254,028 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of liabilities measured at fair value on a recurring basis | Level 1 Level 2 Level 3 Total LIABILITIES Derivative liabilities - warrants $ - $ 1,722,478 $ - $ 1,722,478 Total derivative liabilities - warrants $ - $ 1,722,478 $ - $ 1,722,478 Level 1 Level 2 Level 3 Total LIABILITIES Derivative liabilities – warrants $ - $ 1,722,928 $ - $ 1,722,928 Total derivative liabilities – warrants $ - $ 1,722,928 $ - $ 1,722,928 |
Lease (Tables)
Lease (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Schedule of maturities lease liabilities | Maturity of Lease Liabilities By Fiscal Year 2019 (remaining) $ 552,492 2020 621,435 2021 495,154 2022 455,916 2023 441,262 Thereafter 2,888,699 Total undiscounted operating lease payments $ 5,454,958 Less: Imputed interest (1,248,564 ) Present value of operating lease liabilities $ 4,206,394 |
Schedule of balance sheet classification and other information | Balance Sheet Classification Operating lease liability, current $ 525,120 Operating lease liability, net of current 3,681,274 Total operating lease liabilities $ 4,206,394 Other Information Weighted-average remaining lease term for operating leases 11 years Weighted-average discount rate for operating leases 4.8 % |
Schedule of lease expense | 3/31/2019 Operating lease cost $ 127,144 Variable lease cost 75,405 Short-term lease cost 35,638 Total Rent Expense $ 238,187 |
Schedule of supplemental information related to operating leases | Balance Sheet Classification 1/1/2019 3/31/2019 Right of use asset Other assets $ 4,988,227 $ 4,825,446 Lease liability, current Current liabilities $ 553,316 $ 525,120 Lease liability, net of current Other liabilities $ 3,796,312 $ 3,681,274 |
Organization, Going Concern, _2
Organization, Going Concern, and Basis of Presentation (Details) | 3 Months Ended | |||
Mar. 31, 2019USD ($)integerSupplier | Dec. 31, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Cash and cash equivalents | $ 5,994,672 | $ 7,061,253 | $ 7,659,019 | $ 7,883,191 |
Concentration risk percentage | 66.00% | |||
Number of vendor | integer | 1 | |||
Loss from operations | $ 900,000 | |||
Number of suppliers | Supplier | 20 | |||
Total purchase percentage | 19.00% |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Summary of Significant Accounting Policies (Textual) | ||
Operating lease right-of-use assets | $ 4,825,446 | |
Favorable lease | $ 739,000 | |
Adopted Accounting Pronouncements [Member] | ||
Summary of Significant Accounting Policies (Textual) | ||
Operating lease right-of-use assets | 4,988,000 | |
Lease liabilities | 4,350,000 | |
Prepaid rent | 2,000 | |
Cumulative effect adjustment | 103,000 | |
Favorable lease | $ 739,000 |
Concentration of Risk (Details)
Concentration of Risk (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Risks and Uncertainties [Abstract] | ||
Total Cash in excess of FDIC limits of $250,000 | $ 4,776,000 | $ 6,039,000 |
Concentration of Risk (Details
Concentration of Risk (Details 1) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2019 | Dec. 31, 2018 | |
Percentage of accounts receivable | 66.00% | |
Customer A [Member] | ||
Percentage of accounts receivable | 13.00% | 12.00% |
Customer B [Member] | ||
Percentage of accounts receivable | 0.00% | 55.00% |
Concentration of Risk (Detail_2
Concentration of Risk (Details Textual) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Risks and Uncertainties [Abstract] | ||
Cash and cash equivalents in excess of FDIC limits | $ 250,000 | $ 250,000 |
Disaggregation of Revenues (Det
Disaggregation of Revenues (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Disaggregation of Revenue [Line Items] | ||
Total revenue | $ 4,380,106 | $ 3,607,406 |
Vapor [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 1,224,042 | 1,308,895 |
Grocery [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 3,156,064 | 2,298,511 |
Retail Vapor [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 1,223,722 | 1,302,855 |
Retail Grocery [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 2,753,199 | 1,646,635 |
Food service/restaurant [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 347,651 | 397,564 |
Online/eCommerce [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 46,569 | 250,960 |
Wholesale Grocery [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 8,645 | 3,352 |
Wholesale Vapor [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | $ 320 | $ 6,040 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2019 | Dec. 31, 2018 | |
Gross Carrying Amount | $ 2,644,750 | $ 3,534,750 |
Accumulated Amortization | (427,878) | (472,546) |
Net Carrying Amount | 2,216,872 | $ 3,062,204 |
Favorable lease [Member] | ||
Useful Lives (Years) | 15 years | |
Gross Carrying Amount | $ 890,000 | |
Accumulated Amortization | (150,580) | |
Net Carrying Amount | 739,420 | |
Trade names [Member] | ||
Gross Carrying Amount | 993,000 | 993,000 |
Accumulated Amortization | (277,796) | (252,329) |
Net Carrying Amount | $ 715,204 | $ 740,671 |
Trade names [Member] | Minimum [Member] | ||
Useful Lives (Years) | 8 years | 8 years |
Trade names [Member] | Maximum [Member] | ||
Useful Lives (Years) | 10 years | 10 years |
Customer relationships [Member] | ||
Gross Carrying Amount | $ 1,228,000 | $ 1,228,000 |
Accumulated Amortization | (104,073) | (41,010) |
Net Carrying Amount | $ 1,123,927 | $ 1,186,990 |
Customer relationships [Member] | Minimum [Member] | ||
Useful Lives (Years) | 4 years | 4 years |
Customer relationships [Member] | Maximum [Member] | ||
Useful Lives (Years) | 10 years | 10 years |
Patents [Member] | ||
Useful Lives (Years) | 10 years | 10 years |
Gross Carrying Amount | $ 245,250 | $ 245,250 |
Accumulated Amortization | (29,071) | (22,940) |
Net Carrying Amount | $ 216,179 | $ 222,310 |
Non-compete [Member] | ||
Useful Lives (Years) | 4 years | 4 years |
Gross Carrying Amount | $ 174,000 | $ 174,000 |
Accumulated Amortization | (12,688) | (1,812) |
Net Carrying Amount | $ 161,312 | $ 172,188 |
Website [Member] | ||
Useful Lives (Years) | 3 years | 3 years |
Gross Carrying Amount | $ 4,500 | $ 4,500 |
Accumulated Amortization | (4,250) | (3,875) |
Net Carrying Amount | $ 250 | $ 625 |
Intangible Assets (Details 1)
Intangible Assets (Details 1) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
For the years ending December 31, | ||
2019 (remaining nine months) | $ 316,862 | |
2020 | 422,150 | |
2021 | 415,150 | |
2022 | 399,765 | |
2023 | 159,465 | |
Thereafter | 503,480 | |
Total | $ 2,216,872 | $ 3,062,204 |
Intangible Assets (Details Text
Intangible Assets (Details Textual) - USD ($) | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Amortization expense | $ 106,000 | $ 40,000 | |
Favorable lease | $ 739,000 |
Investment (Details)
Investment (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
MJ Holdings, Inc | $ 65,143 | $ 90,857 |
Mark to Market [Member] | ||
MJ Holdings, Inc | (84,857) | (59,143) |
Fair Value Measurements Using Quoted Prices in Active Market (Level 1) [Member] | ||
MJ Holdings, Inc | $ 150,000 | $ 150,000 |
Investment (Details Textual)
Investment (Details Textual) | 3 Months Ended |
Mar. 31, 2019USD ($)shares | |
Investment (Textual) | |
Investments on common stock shares | shares | 85,714 |
Loss on investment | $ | $ 26,000 |
Contract Assets and Contract _3
Contract Assets and Contract Liabilities (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Contract Assets and Liabilities [Abstract] | ||
Beginning balance as January 1, | $ 442,630 | $ 61,312 |
Issued | 74,894 | 83,834 |
Redeemed | (74,387) | (85,357) |
Breakage recognized | (648) | (923) |
Customer deposits | (201,787) | |
Ending balance as of March 31, | $ 240,702 | $ 58,866 |
Contract Assets and Contract _4
Contract Assets and Contract Liabilities (Details Textual) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Contract Assets and Liabilities (Textual) | ||
Contract assets | $ 18,000 | $ 32,400 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) | 3 Months Ended |
Mar. 31, 2019$ / sharesshares | |
Exercise Price | |
Outstanding at January 1, 2019 | $ / shares | $ 0.0001 |
Warrants settlement | $ / shares | |
Cashless exercises for common stock | $ / shares | (0.0001) |
Black Scholes Value adjustment | $ / shares | (0.0001) |
Outstanding at March 31, 2019 | $ / shares | $ 0.0001 |
Warrant Common Stock Equivalent | |
Warrant Common Stock Equivalent, Outstanding at January 1, 2019 | shares | 41,642,670,772 |
Warrants settlement | shares | |
Cashless exercises for common stock | shares | (10,872,544) |
Black Scholes Value adjustment | shares | (52,882,261) |
Warrant Common Stock Equivalent, Outstanding at March 31, 2019 | shares | 41,578,915,967 |
Remaining Contractual Term | |
Outstanding | 1 year 6 months |
Outstanding | 1 year 2 months 30 days |
Stockholders' Equity (Details 1
Stockholders' Equity (Details 1) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Equity [Abstract] | ||
Warrants outstanding (A) | 2.7341 | 2.7348 |
Black Scholes value (B) | 1,520,758 | 1,522,692 |
Subtotal (C)=(A) x (B) | $ 4,157,904 | $ 4,164,258 |
Closing bid stock price (D) | $ 0.0001 | $ 0.0001 |
Warrant common stock equivalent (C)/(D) | 41,579,000,000 | 41,643,000,000 |
Stockholders' Equity (Details 2
Stockholders' Equity (Details 2) - shares | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Securities excluded from calculation of basic and dilutive income (loss) per share | 333,092,288,647 | 595,157,254,028 |
Stock options [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Securities excluded from calculation of basic and dilutive income (loss) per share | 90,012,230,680 | 89,268,899,200 |
Warrants [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Securities excluded from calculation of basic and dilutive income (loss) per share | 41,578,915,967 | 505,888,354,828 |
Preferred stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Securities excluded from calculation of basic and dilutive income (loss) per share | 201,501,142,000 |
Stockholders' Equity (Details T
Stockholders' Equity (Details Textual) - Stock Options [Member] - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Stockholders' Equity (Textual) | ||
Stock-based compensation expense | $ 100,000 | $ 1,100,000 |
Unamortized stock based compensation expense on unvested stock options | $ 100,000 | |
Amortization period of unamortized stock based compensation expense on unvested stock options | 1 year 3 months 19 days |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
LIABILITIES | ||
Derivative liabilities - warrants | $ 1,722,478 | $ 1,722,928 |
Total derivative liabilities - warrants | 1,722,478 | 1,722,928 |
Fair Value, Measurements, Recurring [Member] | Level 1 [Member] | ||
LIABILITIES | ||
Derivative liabilities - warrants | ||
Total derivative liabilities - warrants | ||
Fair Value, Measurements, Recurring [Member] | Level 2 [Member] | ||
LIABILITIES | ||
Derivative liabilities - warrants | 1,722,478 | 1,722,928 |
Total derivative liabilities - warrants | 1,722,478 | 1,722,928 |
Fair Value, Measurements, Recurring [Member] | Level 3 [Member] | ||
LIABILITIES | ||
Derivative liabilities - warrants | ||
Total derivative liabilities - warrants |
Lease (Details)
Lease (Details) | Mar. 31, 2019USD ($) |
Maturity of Lease Liabilities By Fiscal Year | |
2019 (remaining) | $ 552,492 |
2020 | 621,435 |
2021 | 495,154 |
2022 | 455,916 |
2023 | 441,262 |
Thereafter | 2,888,699 |
Total undiscounted operating lease payments | 5,454,958 |
Less: Imputed interest | (1,248,564) |
Present value of operating lease liabilities | $ 4,206,394 |
Lease (Details 1)
Lease (Details 1) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Balance Sheet Classification | ||
Operating lease liability, current | $ 525,120 | |
Operating lease liability, net of current | 3,681,274 | |
Total operating lease liabilities | $ 4,206,394 | |
Other Information | ||
Weighted-average remaining lease term for operating leases | 11 years | |
Weighted-average discount rate for operating leases | 4.80% |
Lease (Details 2)
Lease (Details 2) | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Leases [Abstract] | |
Operating lease cost | $ 127,144 |
Variable lease cost | 75,405 |
Short-term lease cost | 35,638 |
Total Rent Expense | $ 238,187 |
Lease (Details 3)
Lease (Details 3) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Right of use asset | $ 4,825,446 | |
Lease liability, current | 525,120 | |
Lease liability, net of current | 3,681,274 | |
1/1/2019 [Member] | ||
Right of use asset | 4,988,227 | |
Lease liability, current | 553,316 | |
Lease liability, net of current | $ 3,796,312 |
Lease (Details Textual)
Lease (Details Textual) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Lease (Textual) | ||
Amortization of right-of-use asset | $ 162,782 | |
Lease liability | $ 143,233 | |
Operating lease, description | The most significant impact was the recognition of right-of-use asset of $5.0 million and lease liability of $4.3 million for operating leases as of January 1, 2019. |
Subsequent Events (Details)
Subsequent Events (Details) | Apr. 13, 2018 | Apr. 22, 2019 |
Subsequent Events (Textual) | ||
Subsequent event, description | The Company agreed to a new revolving credit line of $2 million and a money market account of $2 million ("blocked account") with Professional Bank in Coral Gables, Florida. | |
Subsequent Event [Member] | ||
Subsequent Events (Textual) | ||
Subsequent event, description | The Company reached agreement with Professional Bank to renew the credit line for one more year, and the next annual review will occur on or before May 13, 2020. |