Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Nov. 05, 2018 | |
Document and Entity Information | ||
Entity Registrant Name | China Grand Resorts, Inc. | |
Entity Central Index Key | 860,543 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2018 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 48,272,311 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2,018 | |
Entity Emerging Growth Company | true | |
Entity Small Business | true | |
Entity Ex Transition Period | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Current Assets: | ||
Cash | $ 988,379 | $ 1,146,374 |
Accounts receivable, net | 53,700 | |
Inventory, net | 739,095 | 124,121 |
Marketable securities | 200,004 | |
Total Current Assets | 1,781,174 | 1,470,499 |
Property and Equipment, net | 14,879 | 15,413 |
Other Assets | 36,672 | 2,461 |
Total Assets | 1,832,725 | 1,488,373 |
Current Liabilities: | ||
Accounts Payable and Accrued Expenses | 81,006 | 133,160 |
Deferred Revenue | 376,483 | 200,852 |
Convertible notes payable, current portion | 1,500,000 | |
Notes Payable | 89,529 | 165,000 |
Accrued liabilities - other | 1,642,118 | |
Total Current Liabilities | 3,689,136 | 499,012 |
Long-Term Liabilities: | ||
Convertible Notes Payables | 1,718,500 | 1,643,500 |
Total Long-Term Liabilities | 1,718,500 | 1,643,500 |
Total Liabilities | 5,407,636 | 2,142,512 |
Stockholders' Deficit: | ||
Common Stock - 100,000,000 authorized, $0.001 par value, 48,272,311 and 41,828,952 shares issued and outstanding, respectively | 48,272 | 41,829 |
Additional Paid-In Capital | (21,793) | 1,883,656 |
Accumulated Deficit | (3,601,390) | (2,579,624) |
Total Stockholders' Deficit | (3,574,911) | (654,139) |
Total Liabilities, and Stockholders' Deficit | $ 1,832,725 | $ 1,488,373 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2018 | Dec. 31, 2017 |
STOCKHOLDERS' EQUITY | ||
Common Stock, shares par value | $ 0.001 | $ 0.001 |
Common Stock, shares authorized | 100,000,000 | 100,000,000 |
Common Stock, shares issued | 48,272,311 | 41,828,952 |
Common Stock, shares outstanding | 48,272,311 | 41,828,952 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Condensed Consolidated Statements Of Operations | ||||
Sales | $ 1,613,419 | $ 467,089 | $ 4,965,646 | $ 1,317,946 |
Cost of Sales | 1,232,217 | 516,270 | 3,344,655 | 904,739 |
Gross Profit (Loss) | 381,202 | (49,181) | 1,620,991 | 413,207 |
Operating Expenses | ||||
Salaries and wages (including Contractors) | 477,212 | 82,408 | 1,169,856 | 257,326 |
Other Selling, general and administrative expenses | 468,841 | 159,969 | 1,364,896 | 507,170 |
Total operating expenses | 946,053 | 242,377 | 2,534,752 | 764,496 |
Loss from operations | (564,851) | (291,558) | (913,761) | (351,289) |
Other Expense | ||||
Other Expense | (6,503) | (6,503) | ||
Interest expense | (35,174) | (10,408) | (101,502) | (59,115) |
Total Other Expense | (41,677) | (10,408) | (108,005) | (59,115) |
Net Loss | $ (606,528) | $ (301,966) | $ (1,021,766) | $ (410,404) |
Net Loss Per Share Basic and Diluted | $ (0.01) | $ (0.01) | $ (0.02) | $ (0.01) |
Weighted average shares outstanding Basic and Diluted | 45,575,351 | 50,236,238 | 43,575,351 | 40,169,806 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Cash Flows from Operating Activities | ||
Net loss | $ (1,021,766) | $ (410,404) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation expense | 534 | 800 |
Loss on sale of marketable securities | 6,504 | |
Imputed interest | 83,112 | |
Inventory impairment | 128,640 | |
Net change in: | ||
Accounts receivable | (53,700) | |
Inventory | (743,614) | (78,840) |
Other assets | (34,211) | (2,461) |
Accounts payable and accrued expenses | (52,154) | 59,698 |
Deferred revenue | 175,631 | 253,856 |
Net Cash used in Operating Activities | (1,511,024) | (177,351) |
Cash Flows from Investing Activities | ||
Proceeds from sale of marketable securities | 193,500 | |
Purchase of Property and Equipment | (5,341) | |
Net Cash used in Investing Activities | 193,500 | (5,341) |
Cash Flows from Financing Activities | ||
Proceeds from convertible notes payable | 1,575,000 | 100,000 |
Payments on notes payable | (75,471) | (102,184) |
Payments related to reverse acquisition and re-purchase of shares | (340,000) | |
Proceeds from the sale of common stock | 200,000 | |
Net cash provided by financing activities | 1,159,529 | 197,816 |
Net Change in Cash and Cash Equivalents | (157,995) | 15,124 |
Cash and Cash Equivalents, Beginning of Period | 1,146,374 | |
Cash and Cash Equivalents, End of Period | 988,379 | 15,124 |
Cash Paid For: Interest | ||
Cash Paid For: Taxes | ||
Non-cash transactions: | ||
Recapitalization related to reverse merger | 1,642,118 | |
Common stock issued to settle convertible notes payable | $ 100,000 |
Organization and Nature of Oper
Organization and Nature of Operations | 9 Months Ended |
Sep. 30, 2018 | |
Notes to Financial Statements | |
Note 1: Organization and Nature of Operations | China Grand Resorts, Inc. (the “Company”) was organized under the laws of the State of Nevada on September 21, 1989 under the name Fulton Ventures, Inc. Effective on November 16, 2009, the name was changed to China Grand Resorts Inc. After the September 30, 2014 10Q filing, the management of the Company abandoned the Company and the subsidiaries were taken back by the PRC national companies in China who owned them. The remaining parent company, China Grand Resorts, Inc. became a dormant company until 2016 when a new shareholder acquired stock to become the majority shareholder and owner of the Company. On September 14, 2018, the Company’s wholly-owned subsidiary, Jacksam Acquisition Corp., a corporation formed in the State of Nevada on September 11, 2018, or the Acquisition Sub, merged with and into Jacksam Corporation, a corporation incorporated in August 2013 in the State of Delaware, referred to herein as Jacksam. Pursuant to this transaction, or the Merger, Acquisition Sub was the surviving corporation, and changed its name to “Jacksam Corporation”. In accordance with the terms of the Exchange Agreement, and in connection with the completion of the acquisition, on the Closing Date the Company issued 45,000,000 shares of common stock, par value $0.001 per share to the Jacksam shareholders in exchange for all of the issued and outstanding Jacksam. In addition, the previous owners of China Grand Resorts, Inc. returned 30,000,000 shares of common stock to the treasury of the Company. Following the acquisition there was a total of 48,272,311 shares of common stock issued and outstanding of which 3,272,311 are held by shareholders of the Company prior to the merger. In connection with the above transaction $340,000 was paid to the former controlling shareholder related to the return of 30,000,000 shares of common stock. As a result of the Merger, we acquired the business of Jacksam and will continue the existing business operations of Jacksam as our wholly-owned operating subsidiary under the name Jacksam Corporation. In accordance with “reverse merger” or “reverse acquisition” accounting treatment, the China Grand Resorts, Inc. historical financial statements as of period ends, and for periods ended, prior to the Merger will be replaced with the historical financial statements of Jacksam, prior to the Merger, in all future filings with the SEC. Jacksam Corp. (“Jacksam”) is a technology company focused on developing and commercializing products utilizing a proprietary technology platform. The Company services the medical cannabis, hemp and CBD segments of the larger e-cigarette and vaporizer markets with oil vaporizer focused products. As of December 31, 2017, the Company had two principal product lines consisting of vape cartridges and batteries and a filling machine. Customers are primarily businesses operating in jurisdictions that have some form of cannabis legalization. These businesses include medical and recreational dispensaries, large and small scale processors and growers, and distributors. The Company expects continued growth as they take measures to invest in their own molds and intellectual property. The Company operates and sells products from the website www.Convectium.com. |
Significant Accounting Policies
Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2018 | |
Notes to Financial Statements | |
Note 2: Significant Accounting Policies | Basis of Preparation The interim unaudited condensed consolidated financial statements as of September 30, 2018, and for the three and nine months ended September 30, 2018 and 2017, have been prepared in accordance with accounting principles generally accepted in the United States (GAAP) for interim financial information on the same basis as the annual financial statements and in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the Company’s financial position, results of operations and cash flows for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected for a full year or for any future period. They do not include all of the information and footnotes required by GAAP for complete financial statements. Therefore, these financial statements should be read in conjunction with the Jacksam Corporation’s audited financial statements and notes filed with the SEC on September 17, 2018 on Form 8-K for the year ended December 31, 2017. Inventory Inventories are stated at the lower of cost, determined on the first-in, first-out (FIFO) method or net realizable value. Cost principally consists of the purchase price (adjusted for lower of cost or market), customs, duties, and freight. The Company periodically reviews historical sales activity to determine potentially obsolete items and evaluates the impact of any anticipated changes in future demand. At September 30, 2018 and December 31, 2017, the Company had $739,095 and $124,121 in inventory, respectively. The September 30, 2018 and December 31, 2017 inventory consisted entirely of finished goods. The Company will maintain an allowance based on specific inventory items that have shown no activity over a 24-month period. The Company tracks inventory as it is disposed, scrapped or sold at below cost to determine whether additional items on hand should be reduced in value through an allowance method. As of September 30, 2018, and December 31, 2017, the Company has determined that an allowance of $0 and $0 is required. Revenue Recognition The Company derives revenues from the sale of machines and product income. Revenues are recognized when control of the promised goods or services is transferred to the customer in an amount that reflects the consideration the Company expects to be entitled to in exchange for transferring those goods or services. Revenue is recognized based on the following five step model: o Identification of the contract with a customer o Identification of the performance obligations in the contract o Determination of the transaction price o Allocation of the transaction price to the performance obligations in the contract o Recognition of revenue when, or as, the Company satisfies a performance obligation On January 1, 2017, the Company adopted the new accounting standard ASC 606, “Revenue from Contracts with Customers” and all the related amendments (“new revenue standard”) to all contracts using the modified retrospective method, while prior period amounts are not adjusted and continue to be reported in accordance with historic accounting standards under Topic 605. The adoption has had an immaterial impact to the Company’s comparative net income and as such comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. We expect the impact of the adoption of the new standard to be immaterial to the Company’s net income on an ongoing basis. Going Concern The Company's financial statements are prepared using accounting principles generally accepted 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. However, the Company has negative working capital, recurring losses, and does not have a source of revenues sufficient to cover its operating costs. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent upon its ability to successfully execute the business plan and attain profitable operations. The accompanying financial statements do not include any adjustments that may be necessary if the Company is unable to continue as a going concern. In the coming year, the Company’s foreseeable cash requirements will relate to continual development of the operations of its business, maintaining its good standing and making the requisite filings with the Securities and Exchange Commission, and the payment of expenses associated with operations and business developments. The Company may experience a cash shortfall and be required to raise additional capital. Historically, it has mostly relied upon convertible notes payable and cash flows from operations to finance its operations and growth. Management may raise additional capital by retaining net earnings or through future private offerings of the Company’s stock or through loans from private investors, although there can be no assurance that it will be able to obtain such financing. The Company’s failure to do so could have a material and adverse effect upon it and its shareholders. Net Loss Per Common Share Basic net loss per common share is computed by dividing net loss by the weighted-average number of common shares outstanding during the period. Potential common stock equivalents are determined using the treasury stock method. For diluted net loss per share purposes, the Company excludes stock options and other stock-based awards, including shares issued as a result of option exercises but which are subject to repurchase by the Company, whose effect would be anti-dilutive from the calculation. During the three and nine months ended September 30, 2018 and 2017, common stock equivalents were excluded from the calculation of diluted net loss per common share, as their effect was anti-dilutive due to the net loss incurred. Therefore, basic and diluted net loss per share was the same in all periods presented. The Company had 5,000,000 and 3,171,048 potentially dilutive securities that have been excluded from the computation of diluted weighted-average shares outstanding as of September 30, 2018 and 2017, as they would be anti-dilutive. Stock-Based Compensation The Company accounts for stock-based compensation in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 718, Stock Compensation For awards that vest based on service conditions, the Company uses the straight-line method to allocate compensation expense to reporting periods. The grant date fair value of options granted is calculated using the Black-Scholes option pricing model, which requires the use of subjective assumptions including volatility, expected term and the fair value of the underlying common stock, among others. The Company periodically issues performance-based awards. For these awards, vesting will occur upon the achievement of certain milestones. When achievement of the milestone is deemed probable, the Company expenses the compensation of the respective awards over the implicit service period. Stock awards to non-employees are accounted for in accordance with ASC 505-50, Equity-Based Payments to Non-Employees Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting The stock-based compensation plans provide that grantees may have the right to exercise an option prior to vesting. Shares purchased upon the exercise of unvested options will be subject to the same vesting schedule as the underlying options and are subject to repurchase at the original exercise price by the Company should the grantee discontinue providing services to the Company for any reason, prior to becoming fully vested in such shares. Issuance Costs Related to Equity and Debt The Company allocates issuance costs between the individual freestanding instruments identified on the same basis as proceeds were allocated. Issuance costs associated with the issuance of stock or equity contracts (i.e., equity-classified warrants and convertible preferred stock) are recorded as a charge against the gross proceeds of the offering. Any issuance costs associated with the issuance of liability-classified warrants are expensed as incurred. Issuance costs associated with the issuance of debt (i.e., convertible debt) is recorded as a direct reduction of the carrying amount of the debt liability but limited to the notional value of the debt. The Company accounts for debt as liabilities measured at amortized cost and amortizes the resulting debt discount to interest expense using the effective interest method over the expected term of the notes pursuant to ASC 835, Interest Embedded Conversion Features The Company evaluates embedded conversion features within convertible debt under ASC 815 “Derivatives and Hedging” to determine whether the embedded conversion feature(s) should be bifurcated from the host instrument and accounted for as a derivative at fair value with changes in fair value recorded in earnings. If the conversion feature does not require derivative treatment under ASC 815, the instrument is evaluated under ASC 470-20 “Debt with Conversion and Other Options.” Under the ASC 470-20, an entity must separately account for the liability and equity components of the convertible debt instruments that may be settled entirely or partially in cash upon conversion in a manner that reflects the issuer’s economic interest cost. The effect of ASC 470-20 on the accounting for our convertible debt instruments is that the equity component is required to be included in the additional paid-in capital section of stockholders’ equity on the consolidated balance sheets and the value of the equity component is treated as original issue discount for purposes of accounting for the debt component of the notes. As a result, we are required to record non-cash interest expense as a result of the amortization of the discounted carrying value of the convertible debt to their face amount over the term of the convertible debt. We report higher interest expense in our financial results because ASC 470-20 requires interest to include both the current period’s amortization of the debt discount and the instrument’s coupon interest. For conventional convertible debt where the rate of conversion is below market value, the Company records a "beneficial conversion feature" ("BCF") and related debt discount. When the Company records a BCF, the relative fair value of the BCF is recorded as a debt discount against the face amount of the respective debt instrument (offset to additional paid in capital) and amortized to interest expense over the life of the debt. Derivatives and Hedging On July 1, 2017, the Company early adopted ASU 2017-11, “ Earnings Per Share (Topic 260) Distinguishing Liabilities from Equity (Topic 480) Derivatives and Hedging (Topic 815), ASU 2017-11 changes the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. ASU 2017-11 also clarifies existing disclosure requirements for equity- classified instruments. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (EPS) in accordance with Topic 260 to recognize the effect of the down round feature when it is triggered. That effect is treated as a dividend and as a reduction of income available to common shareholders in basic EPS. Convertible instruments with embedded conversion options that have down round features are now subject to the specialized guidance for contingent beneficial conversion features (in Subtopic 470-20, “Debt—Debt with Conversion and Other Options”), including related EPS guidance (ASC 260). Part II of ASU 2017-11 recharacterize the indefinite deferral of certain provisions of ASC 480 that now are presented as pending content in the ASC, to a scope exception. Those amendments do not have an accounting effect. Prior to the early adoption of ASU 2017-11, an equity-linked financial instrument with a down round feature that otherwise is not required to be classified as a liability under the guidance in ASC 480 is evaluated under the guidance in ASC 815, “Derivatives and Hedging,” to determine whether it meets the definition of a derivative. If it meets that definition, the instrument (or embedded feature) is evaluated to determine whether it is indexed to an entity’s own stock as part of the analysis of whether it qualifies for a scope exception from derivative accounting. Generally, for warrants and conversion options embedded in financial instruments that are deemed to have a debt host (assuming the underlying shares are readily convertible to cash or the contract provides for net settlement such that the embedded conversion option meets the definition of a derivative), the existence of a down round feature results in an instrument not being considered indexed to an entity’s own stock. This results in a reporting entity being required to classify the freestanding financial instrument or the bifurcated conversion option as a liability, which the entity must measure at fair value initially and at each subsequent reporting date. ASU 2017-11 revises the guidance for instruments with down round features in ASC 815-40, “Derivatives and Hedging—Contracts in Entity’s Own Equity,” which is considered in determining whether an equity-linked financial instrument qualifies for a scope exception from derivative accounting. An entity still is required to determine whether instruments would be classified in equity under the guidance in ASC 815-40 in determining whether they qualify for that scope exception. If they do qualify, freestanding instruments with down round features are no longer classified as liabilities and embedded conversion options with down round features are no longer bifurcated. For entities that present EPS in accordance with ASC 260, and when the down round feature is included in an equity-classified freestanding financial instrument, the value of the effect of the down round feature is treated as a dividend when it is triggered and as a numerator adjustment in the basic EPS calculation. This reflects the occurrence of an economic transfer of value to the holder of the instrument, while alleviating the complexity and income statement volatility associated with fair value measurement on an ongoing basis. Convertible instruments are unaffected by ASU 2017-11. Part I of ASU 2017-11 are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted for all entities, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. ASU 2017-11 Part 1 should be applied retrospectively to outstanding financial instruments with a down round feature for each prior reporting period presented in accordance with the guidance on accounting changes in paragraphs ASC 250-10-45-5 through 45-10. The Company has determined that there were no previously outstanding financial instruments that fall under the scope of ASU 2017-11. Therefore, the Company has not determined and has not recorded a cumulative-effect adjustment to the balance sheet. ASU 2017-11 Part II does not require any transition guidance because those amendments do not have an accounting effect. The Company considered the impact of Part 1 of ASU 2017-11 and determined the Company had no financial instruments previously carried as derivative liabilities that were deemed to be such on the basis of embedded features containing down round provisions, resulting in the strike price being reduced on the basis of the pricing of future equity offerings. As a result, upon the early adoption provisions of ASU 2017-11, the Company did not record any adjustment to its books to account for any transition accounting issues. Subsequent Events The Company evaluates events occurring after the date of its consolidated balance sheet for potential recognition or disclosure in its consolidated financial statements. There have been no subsequent events that occurred through the date the Company issued its consolidated financial statements that require disclosure in or adjustment to its consolidated financial statements. Principles of Consolidation The accompanying consolidated financial statements include the accounts of China Grand Resorts, Inc. and its wholly owned subsidiary. All intercompany transactions and balances are eliminated in consolidation. New Accounting Pronouncements From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies that are adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the effect of recently issued standards that are not yet effective will not have a material effect on its consolidated financial position or results of operations upon adoption. In May 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-09 (“ASU 2014-09”), Revenue from Contracts with Customers Revenue Recognition In July 2015, the FASB issued ASU No. 2015-11, Simplifying the Measurement of Inventory In January 2016, the FASB issued ASU No. 2016-01, " Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) In March 2016, the FASB issued ASU No. 2016-09, Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting In August 2016, the FASB issued ASU No. 2016-15, Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force) Statement of Cash Flows In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash (a consensus of the FASB Emerging Issue Task Force) In July 2017, the FASB issued ASU 2017-11, “Earnings Per Share (ASC 260) Distinguishing Liabilities from Equity (ASC 480) Derivatives and Hedging (ASC 815),” |
Property and equipment
Property and equipment | 9 Months Ended |
Sep. 30, 2018 | |
Notes to Financial Statements | |
Note 3: Property and equipment | Property and equipment consisted of the following: September 30, 2018 December 31, 2017 Furniture and Fixtures $ 10,425 $ 10,425 Equipment 7,579 7,579 Trade Show Display 2,640 2,640 Total 20,644 20,644 Less: Accumulated Depreciation (5,765 ) (5,231 ) Property and Equipment net $ 14,879 $ 15,413 Depreciation expense amounted to $534 and $800 for the nine months ended September 30, 2018 and 2017, respectively. |
Accounts payable and accrued ex
Accounts payable and accrued expenses | 9 Months Ended |
Sep. 30, 2018 | |
Notes to Financial Statements | |
Note 4: Accounts payable and accrued expenses | Accounts payable and accrued expenses consist of the following: September 30, 2018 December 31, 2017 Accounts payable $ 36,187 $ 102,249 Credit cards payable 12,999 5,398 Accrued interest 473 16,766 Sales tax payable 30,071 7,147 Other 1,276 1,600 Total Accounts payable and Accrued expenses $ 81,006 $ 133,160 |
Notes Payable
Notes Payable | 9 Months Ended |
Sep. 30, 2018 | |
Notes to Financial Statements | |
Note 5: Notes Payable | A summary of Notes Payable are as follows: September 30, 2018 December 31, 2017 Note payable dated August 22, 2016, bearing interest at 12% per annum, due November 22, 2016, past due at year end, paid in full July 2018 $ - $ 75,000 Note payable dated November 21, 2016, bearing interest at 12% per annum, due February 21, 2017, currently past due 89,529 90,000 Total notes payable 89,529 165,000 Less: current portion 89,529 165,000 Long term portion of notes payable $ - $ - As of September 30, 2018 and December 31, 2017, accrued interest on these loans outstanding balances for $473 and $16,766, respectively. |
Convertible Notes Payable
Convertible Notes Payable | 9 Months Ended |
Sep. 30, 2018 | |
Notes to Financial Statements | |
Note 6: Convertible Notes Payable | In December 2017, the Company issued non-interest bearing convertible debentures to 36 investors in exchange for $1,643,500 (the “2017 Notes”). The 2017 Notes have a three-year term and are convertible into the Company’s common stock at a per share price of $0.20 at any time subsequent to the issuance date. On the maturity date, if not previously converted, the 2017 Notes are subject to a mandatory conversion to the Company’s common stock. In January 2018, the Company issued non-interest bearing convertible notes with the same terms as the 2017 Notes in exchange for an additional $75,000. The Company determined that the 2017 Notes qualified as conventional convertible instruments. The Company evaluated the conversion feature and determined that no beneficial conversion feature existed on the issuance dates. Imputed interest of $51,222 was calculated and accrued at 4% and recorded to additional paid in capital. In March 2018, the Company issued non-interest bearing convertible notes to two investors in exchange for $1,500,000 (the “2018 Notes”). The 2018 Notes have a one-year term and are convertible into the Company’s common stock at a per share price of $0.90 at any time subsequent to the issuance date. Upon either the maturity date or a successful financing involving the Company’s common stock or a financial instrument convertible into common stock at a valuation of $45,000,000 or more, the 2018 Notes are subject to mandatory conversion to the Company’s common stock, if not previously converted. The Company determined that the 2018 Notes qualified as conventional convertible instruments. Further the Company evaluated the conversion feature and determined that there was no beneficial conversion feature or derivative liabilities. Imputed interest of $31,890 was calculated and accrued at 4% and recorded to additional paid in capital. |
Accrued Liabilities _ Other
Accrued Liabilities – Other | 9 Months Ended |
Sep. 30, 2018 | |
Notes to Financial Statements | |
Note 7: Accrued Liabilities - Other | Prior to the Merger, China Grand Resorts, Inc., recorded various liabilities that were incurred by former related parties. Management believes the relevant statute of limitations has passed and that no enforceable legal claim exists in relation to these liabilities. However, management does not intend to remove these liabilities, $1,642,118, from the Company’s financial statements until such time that the liability is formally settled or judicially released in accordance with ASC 405-20-40. |
Related Party
Related Party | 9 Months Ended |
Sep. 30, 2018 | |
Notes to Financial Statements | |
Note 8: Related Party | During the nine months ended September 30, 2018 prior to our reverse merger we advanced major shareholder and Chairman, Mr. Davis $25,000. The advance was repaid in full by Mr. Davis on April 2, 2018. |
Commitments
Commitments | 9 Months Ended |
Sep. 30, 2018 | |
Notes to Financial Statements | |
Note 9: Commitments | Operating Lease In March 2017, the Company entered into an office lease located in Racho Santa Margarita, California with an initial term of 37 months. Base monthly rent is approximately $3,200 per month plus net operating expenses. A deposit equal to one-month rent was paid and the commencement of the lease. The lease can be extended for a two-year period at the then fair market value. Minimum lease payment under this arrangement for 2018 (October – December), 2019 and 2020 is $14,554, $48,968 and $20,600, respectively. Operating lease expenses for the nine months ended September 30, 2018 and 2017 were $47,785 and $43,109, respectively. |
Equity
Equity | 9 Months Ended |
Sep. 30, 2018 | |
Notes to Financial Statements | |
Note 10: Equity | Common Stock As of September 30, 2018, the authorized capital stock of the Company consists of 100,000,000 shares, of which 100,000,000 shares are designated as common stock. In accordance with the terms of the Exchange Agreement, and in connection with the completion of the acquisition, on the Closing Date the Company issued 45,000,000 shares of common stock, par value $0.001 per share to the Jacksam shareholders in exchange for all of the issued and outstanding Jacksam common stock. In addition, the previous majority shareholder of China Grand Resorts, Inc. returned 30,000,000 shares of common stock to the treasury of the Company. Following the acquisition there was a total of 48,272,311 shares of common stock issued and outstanding of which 3,272,311 are held by shareholders of the Company prior to the merger. Stock Options and Warrants A summary of stock option and stock warrant information is as follows: Aggregate Number Aggregate Exercise Price Exercise Price Range Weighted Average Exercise Price Outstanding at December 31, 2017 8,171,048 $ 5,743 $ 0.0007 $ 0.0007 Granted - - - - Exercised (3,171,048 ) 743 0.0002 0.0002 Forfeited and cancelled - - - - Outstanding at September 30, 2018 5,000,000 $ 5,000 $ 0.001 $ 0.001 The weighted average remaining contractual life is approximately 2.2 years for stock options and warrants outstanding on September 30, 2018. All of the above options and warrants were fully vested at the time of issuance. Stock based compensation is related to the above issuances. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Significant Accounting Policies | |
Basis of Preparation | The interim unaudited condensed consolidated financial statements as of September 30, 2018, and for the three and nine months ended September 30, 2018 and 2017, have been prepared in accordance with accounting principles generally accepted in the United States (GAAP) for interim financial information on the same basis as the annual financial statements and in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the Company’s financial position, results of operations and cash flows for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected for a full year or for any future period. They do not include all of the information and footnotes required by GAAP for complete financial statements. Therefore, these financial statements should be read in conjunction with the Jacksam Corporation’s audited financial statements and notes filed with the SEC on September 17, 2018 on Form 8-K for the year ended December 31, 2017. |
Inventory | Inventories are stated at the lower of cost, determined on the first-in, first-out (FIFO) method or net realizable value. Cost principally consists of the purchase price (adjusted for lower of cost or market), customs, duties, and freight. The Company periodically reviews historical sales activity to determine potentially obsolete items and evaluates the impact of any anticipated changes in future demand. At September 30, 2018 and December 31, 2017, the Company had $739,095 and $124,121 in inventory, respectively. The September 30, 2018 and December 31, 2017 inventory consisted entirely of finished goods. The Company will maintain an allowance based on specific inventory items that have shown no activity over a 24-month period. The Company tracks inventory as it is disposed, scrapped or sold at below cost to determine whether additional items on hand should be reduced in value through an allowance method. As of September 30, 2018, and December 31, 2017, the Company has determined that an allowance of $0 and $0 is required. |
Revenue Recognition | The Company derives revenues from the sale of machines and product income. Revenues are recognized when control of the promised goods or services is transferred to the customer in an amount that reflects the consideration the Company expects to be entitled to in exchange for transferring those goods or services. Revenue is recognized based on the following five step model: o Identification of the contract with a customer o Identification of the performance obligations in the contract o Determination of the transaction price o Allocation of the transaction price to the performance obligations in the contract o Recognition of revenue when, or as, the Company satisfies a performance obligation On January 1, 2017, the Company adopted the new accounting standard ASC 606, “Revenue from Contracts with Customers” and all the related amendments (“new revenue standard”) to all contracts using the modified retrospective method, while prior period amounts are not adjusted and continue to be reported in accordance with historic accounting standards under Topic 605. The adoption has had an immaterial impact to the Company’s comparative net income and as such comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. We expect the impact of the adoption of the new standard to be immaterial to the Company’s net income on an ongoing basis. |
Going Concern | The Company's financial statements are prepared using accounting principles generally accepted 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. However, the Company has negative working capital, recurring losses, and does not have a source of revenues sufficient to cover its operating costs. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent upon its ability to successfully execute the business plan and attain profitable operations. The accompanying financial statements do not include any adjustments that may be necessary if the Company is unable to continue as a going concern. In the coming year, the Company’s foreseeable cash requirements will relate to continual development of the operations of its business, maintaining its good standing and making the requisite filings with the Securities and Exchange Commission, and the payment of expenses associated with operations and business developments. The Company may experience a cash shortfall and be required to raise additional capital. Historically, it has mostly relied upon convertible notes payable and cash flows from operations to finance its operations and growth. Management may raise additional capital by retaining net earnings or through future private offerings of the Company’s stock or through loans from private investors, although there can be no assurance that it will be able to obtain such financing. The Company’s failure to do so could have a material and adverse effect upon it and its shareholders. |
Net Loss Per Common Share | Basic net loss per common share is computed by dividing net loss by the weighted-average number of common shares outstanding during the period. Potential common stock equivalents are determined using the treasury stock method. For diluted net loss per share purposes, the Company excludes stock options and other stock-based awards, including shares issued as a result of option exercises but which are subject to repurchase by the Company, whose effect would be anti-dilutive from the calculation. During the three and nine months ended September 30, 2018 and 2017, common stock equivalents were excluded from the calculation of diluted net loss per common share, as their effect was anti-dilutive due to the net loss incurred. Therefore, basic and diluted net loss per share was the same in all periods presented. The Company had 5,000,000 and 3,171,048 potentially dilutive securities that have been excluded from the computation of diluted weighted-average shares outstanding as of September 30, 2018 and 2017, as they would be anti-dilutive. |
Stock-Based Compensation | The Company accounts for stock-based compensation in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 718, Stock Compensation For awards that vest based on service conditions, the Company uses the straight-line method to allocate compensation expense to reporting periods. The grant date fair value of options granted is calculated using the Black-Scholes option pricing model, which requires the use of subjective assumptions including volatility, expected term and the fair value of the underlying common stock, among others. The Company periodically issues performance-based awards. For these awards, vesting will occur upon the achievement of certain milestones. When achievement of the milestone is deemed probable, the Company expenses the compensation of the respective awards over the implicit service period. Stock awards to non-employees are accounted for in accordance with ASC 505-50, Equity-Based Payments to Non-Employees Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting The stock-based compensation plans provide that grantees may have the right to exercise an option prior to vesting. Shares purchased upon the exercise of unvested options will be subject to the same vesting schedule as the underlying options and are subject to repurchase at the original exercise price by the Company should the grantee discontinue providing services to the Company for any reason, prior to becoming fully vested in such shares. |
Issuance Costs Related to Equity and Debt | The Company allocates issuance costs between the individual freestanding instruments identified on the same basis as proceeds were allocated. Issuance costs associated with the issuance of stock or equity contracts (i.e., equity-classified warrants and convertible preferred stock) are recorded as a charge against the gross proceeds of the offering. Any issuance costs associated with the issuance of liability-classified warrants are expensed as incurred. Issuance costs associated with the issuance of debt (i.e., convertible debt) is recorded as a direct reduction of the carrying amount of the debt liability but limited to the notional value of the debt. The Company accounts for debt as liabilities measured at amortized cost and amortizes the resulting debt discount to interest expense using the effective interest method over the expected term of the notes pursuant to ASC 835, Interest |
Embedded Conversion Features | The Company evaluates embedded conversion features within convertible debt under ASC 815 “Derivatives and Hedging” to determine whether the embedded conversion feature(s) should be bifurcated from the host instrument and accounted for as a derivative at fair value with changes in fair value recorded in earnings. If the conversion feature does not require derivative treatment under ASC 815, the instrument is evaluated under ASC 470-20 “Debt with Conversion and Other Options.” Under the ASC 470-20, an entity must separately account for the liability and equity components of the convertible debt instruments that may be settled entirely or partially in cash upon conversion in a manner that reflects the issuer’s economic interest cost. The effect of ASC 470-20 on the accounting for our convertible debt instruments is that the equity component is required to be included in the additional paid-in capital section of stockholders’ equity on the consolidated balance sheets and the value of the equity component is treated as original issue discount for purposes of accounting for the debt component of the notes. As a result, we are required to record non-cash interest expense as a result of the amortization of the discounted carrying value of the convertible debt to their face amount over the term of the convertible debt. We report higher interest expense in our financial results because ASC 470-20 requires interest to include both the current period’s amortization of the debt discount and the instrument’s coupon interest. For conventional convertible debt where the rate of conversion is below market value, the Company records a "beneficial conversion feature" ("BCF") and related debt discount. When the Company records a BCF, the relative fair value of the BCF is recorded as a debt discount against the face amount of the respective debt instrument (offset to additional paid in capital) and amortized to interest expense over the life of the debt. |
Derivatives and Hedging | On July 1, 2017, the Company early adopted ASU 2017-11, “ Earnings Per Share (Topic 260) Distinguishing Liabilities from Equity (Topic 480) Derivatives and Hedging (Topic 815), ASU 2017-11 changes the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. ASU 2017-11 also clarifies existing disclosure requirements for equity- classified instruments. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (EPS) in accordance with Topic 260 to recognize the effect of the down round feature when it is triggered. That effect is treated as a dividend and as a reduction of income available to common shareholders in basic EPS. Convertible instruments with embedded conversion options that have down round features are now subject to the specialized guidance for contingent beneficial conversion features (in Subtopic 470-20, “Debt—Debt with Conversion and Other Options”), including related EPS guidance (ASC 260). Part II of ASU 2017-11 recharacterize the indefinite deferral of certain provisions of ASC 480 that now are presented as pending content in the ASC, to a scope exception. Those amendments do not have an accounting effect. Prior to the early adoption of ASU 2017-11, an equity-linked financial instrument with a down round feature that otherwise is not required to be classified as a liability under the guidance in ASC 480 is evaluated under the guidance in ASC 815, “Derivatives and Hedging,” to determine whether it meets the definition of a derivative. If it meets that definition, the instrument (or embedded feature) is evaluated to determine whether it is indexed to an entity’s own stock as part of the analysis of whether it qualifies for a scope exception from derivative accounting. Generally, for warrants and conversion options embedded in financial instruments that are deemed to have a debt host (assuming the underlying shares are readily convertible to cash or the contract provides for net settlement such that the embedded conversion option meets the definition of a derivative), the existence of a down round feature results in an instrument not being considered indexed to an entity’s own stock. This results in a reporting entity being required to classify the freestanding financial instrument or the bifurcated conversion option as a liability, which the entity must measure at fair value initially and at each subsequent reporting date. ASU 2017-11 revises the guidance for instruments with down round features in ASC 815-40, “Derivatives and Hedging—Contracts in Entity’s Own Equity,” which is considered in determining whether an equity-linked financial instrument qualifies for a scope exception from derivative accounting. An entity still is required to determine whether instruments would be classified in equity under the guidance in ASC 815-40 in determining whether they qualify for that scope exception. If they do qualify, freestanding instruments with down round features are no longer classified as liabilities and embedded conversion options with down round features are no longer bifurcated. For entities that present EPS in accordance with ASC 260, and when the down round feature is included in an equity-classified freestanding financial instrument, the value of the effect of the down round feature is treated as a dividend when it is triggered and as a numerator adjustment in the basic EPS calculation. This reflects the occurrence of an economic transfer of value to the holder of the instrument, while alleviating the complexity and income statement volatility associated with fair value measurement on an ongoing basis. Convertible instruments are unaffected by ASU 2017-11. Part I of ASU 2017-11 are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted for all entities, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. ASU 2017-11 Part 1 should be applied retrospectively to outstanding financial instruments with a down round feature for each prior reporting period presented in accordance with the guidance on accounting changes in paragraphs ASC 250-10-45-5 through 45-10. The Company has determined that there were no previously outstanding financial instruments that fall under the scope of ASU 2017-11. Therefore, the Company has not determined and has not recorded a cumulative-effect adjustment to the balance sheet. ASU 2017-11 Part II does not require any transition guidance because those amendments do not have an accounting effect. The Company considered the impact of Part 1 of ASU 2017-11 and determined the Company had no financial instruments previously carried as derivative liabilities that were deemed to be such on the basis of embedded features containing down round provisions, resulting in the strike price being reduced on the basis of the pricing of future equity offerings. As a result, upon the early adoption provisions of ASU 2017-11, the Company did not record any adjustment to its books to account for any transition accounting issues. |
Subsequent Events | The Company evaluates events occurring after the date of its consolidated balance sheet for potential recognition or disclosure in its consolidated financial statements. There have been no subsequent events that occurred through the date the Company issued its consolidated financial statements that require disclosure in or adjustment to its consolidated financial statements. |
Principles of Consolidation | The accompanying consolidated financial statements include the accounts of China Grand Resorts, Inc. and its wholly owned subsidiary. All intercompany transactions and balances are eliminated in consolidation. |
New Accounting Pronouncements | From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies that are adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the effect of recently issued standards that are not yet effective will not have a material effect on its consolidated financial position or results of operations upon adoption. In May 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-09 (“ASU 2014-09”), Revenue from Contracts with Customers Revenue Recognition In July 2015, the FASB issued ASU No. 2015-11, Simplifying the Measurement of Inventory In January 2016, the FASB issued ASU No. 2016-01, " Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) In March 2016, the FASB issued ASU No. 2016-09, Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting In August 2016, the FASB issued ASU No. 2016-15, Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force) Statement of Cash Flows In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash (a consensus of the FASB Emerging Issue Task Force) In July 2017, the FASB issued ASU 2017-11, “Earnings Per Share (ASC 260) Distinguishing Liabilities from Equity (ASC 480) Derivatives and Hedging (ASC 815),” |
Property and equipment (Tables)
Property and equipment (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Property And Equipment | |
Property and equipment | September 30, 2018 December 31, 2017 Furniture and Fixtures $ 10,425 $ 10,425 Equipment 7,579 7,579 Trade Show Display 2,640 2,640 Total 20,644 20,644 Less: Accumulated Depreciation (5,765 ) (5,231 ) Property and Equipment net $ 14,879 $ 15,413 |
Accounts payable and accrued _2
Accounts payable and accrued expenses (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Accounts Payable And Accrued Expenses | |
Accounts payable and accrued expenses | September 30, 2018 December 31, 2017 Accounts payable $ 36,187 $ 102,249 Credit cards payable 12,999 5,398 Accrued interest 473 16,766 Sales tax payable 30,071 7,147 Other 1,276 1,600 Total Accounts payable and Accrued expenses $ 81,006 $ 133,160 |
Notes Payable (Tables)
Notes Payable (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Notes Payable Tables Abstract | |
summary of Notes Payable | September 30, 2018 December 31, 2017 Note payable dated August 22, 2016, bearing interest at 12% per annum, due November 22, 2016, past due at year end, paid in full July 2018 $ - $ 75,000 Note payable dated November 21, 2016, bearing interest at 12% per annum, due February 21, 2017, currently past due 89,529 90,000 Total notes payable 89,529 165,000 Less: current portion 89,529 165,000 Long term portion of notes payable $ - $ - |
Equity (Tables)
Equity (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Accounts Payable And Accrued Expenses | |
Summary of stock option and stock warrant | Aggregate Number Aggregate Exercise Price Exercise Price Range Weighted Average Exercise Price Outstanding at December 31, 2017 8,171,048 $ 5,743 $ 0.0007 $ 0.0007 Granted - - - - Exercised (3,171,048 ) 743 0.0002 0.0002 Forfeited and cancelled - - - - Outstanding at September 30, 2018 5,000,000 $ 5,000 $ 0.001 $ 0.001 |
Organization and Nature of Op_2
Organization and Nature of Operations (Details Narrative) - USD ($) | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
State of Incorporation | Nevada | |||
Date of Incorporation | Sep. 21, 1989 | |||
Common stock shares returned to the treasury | 30,000,000 | 30,000,000 | ||
Common Stock, shares par value | $ 0.001 | $ 0.001 | $ 0.001 | |
Common Stock, shares issued | 48,272,311 | 48,272,311 | 41,828,952 | |
Common stock shares outstanding | 48,272,311 | 48,272,311 | 41,828,952 | |
Payments related to reverse acquisition and re-purchase of shares | $ (340,000) | |||
Exchange Agreement [Member] | Jacksam [Member] | ||||
Business acquisition, equity interest issued or issuable | 45,000,000 | 45,000,000 | ||
Business acquisition, par value | $ 0.001 | $ 0.001 | ||
Pre-Merger [Member] | ||||
Common stock shares held by shareholders | 3,272,311 | 3,272,311 |
Significant Accounting Polici_3
Significant Accounting Policies (Details Narrative) - USD ($) | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Significant Accounting Policies Details Narrative Abstract | |||
Inventory, net | $ 739,095 | $ 124,121 | |
Allowance of inventory | $ 0 | $ 0 | |
Potentially dilutive securities | 5,000,000 | 3,171,048 |
Property and equipment (Details
Property and equipment (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Total | $ 20,644 | $ 20,644 |
Less: Accumulated Depreciation | (5,765) | (5,231) |
Property and Equipment net | 14,879 | 15,413 |
Furniture and Fixtures [Member] | ||
Total | 10,425 | 10,425 |
Equipment [Member] | ||
Total | 7,579 | 7,579 |
Trade Show Display [Member] | ||
Total | $ 2,640 | $ 2,640 |
Property and equipment (Detai_2
Property and equipment (Details Narrative) - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Property And Equipment Details Narrative Abstract | ||
Depreciation expense | $ 534 | $ 800 |
Accounts payable and accrued _3
Accounts payable and accrued expenses (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Total Accounts payable and Accrued expenses | $ 81,006 | $ 133,160 |
Accounts Payable [Member] | ||
Total Accounts payable and Accrued expenses | 36,187 | 102,249 |
Credit Cards Payable [Member] | ||
Total Accounts payable and Accrued expenses | 12,999 | 5,398 |
Accrued Interest [Member] | ||
Total Accounts payable and Accrued expenses | 473 | 16,766 |
Sales Tax Payable [Member] | ||
Total Accounts payable and Accrued expenses | 30,071 | 7,147 |
Other [Member] | ||
Total Accounts payable and Accrued expenses | $ 1,276 | $ 1,600 |
Notes Payable (Details)
Notes Payable (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Total notes payable | $ 89,529 | $ 165,000 |
Less: current portion | 89,529 | 165,000 |
Long term portion of notes payable | ||
Notes Payable [Member] | ||
Total notes payable | 75,000 | |
Notes Payable One [Member] | ||
Total notes payable | $ 89,529 | $ 90,000 |
Notes Payable (Details Narrativ
Notes Payable (Details Narrative) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Accrued interest | $ 473 | $ 16,766 |
Notes Payable [Member] | ||
Notes payable bearing interest rate | 12.00% | |
Notes Payable One [Member] | ||
Notes payable bearing interest rate | 12.00% |
Convertible Notes Payable (Deta
Convertible Notes Payable (Details Narrative) - Investors [Member] | 1 Months Ended | 9 Months Ended | ||
Mar. 31, 2018USD ($)Number$ / shares | Jan. 31, 2018USD ($) | Dec. 31, 2017USD ($)Number$ / shares | Sep. 30, 2018USD ($)$ / shares | |
Convertible Debentures (2017 Notes) [Member] | ||||
Number of debentures | Number | 36 | |||
Proceeds from issuance of convertible debt | $ 75,000 | $ 1,643,500 | ||
Maturity period | 3 years | |||
Conversion price | $ / shares | $ 0.20 | $ 0.20 | ||
Terms of conversion feature | On the maturity date, if not previously converted, the 2017 Notes are subject to a mandatory conversion to the Company’s common stock | |||
Imputed interest | $ 51,222 | |||
Interest rate | 4.00% | |||
Convertible Notes (2018 Notes) [Member] | ||||
Number of debentures | Number | 2 | |||
Proceeds from issuance of convertible debt | $ 1,500,000 | |||
Maturity period | 1 year | |||
Conversion price | $ / shares | $ 0.90 | |||
Terms of conversion feature | Upon either the maturity date or a successful financing involving the Company’s common stock or a financial instrument convertible into common stock at a valuation of $45,000,000 or more, the 2018 Notes are subject to mandatory conversion to the company’s common stock, if not previously converted | |||
Imputed interest | $ 31,890 | |||
Interest rate | 4.00% |
Accrued Liabilities _ Other (De
Accrued Liabilities – Other (Details Narrative) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Accrued liabilities – other | $ 1,642,118 | |
Merger [Member] | ||
Accrued liabilities – other | $ 1,642,118 |
Commitments (Details Narrative)
Commitments (Details Narrative) - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Commitments | ||
Operating lease monthly rent expenses | $ 3,200 | |
Operating lease expenses | $ 47,785 | $ 43,109 |
Operating lease contract term | 37 months | |
2,018 | $ 14,554 | |
2,019 | 48,968 | |
2,020 | $ 20,600 |
Equity (Details)
Equity (Details) - Stock Options and Warrants [Member] | 9 Months Ended |
Sep. 30, 2018USD ($)$ / sharesshares | |
Aggregate Number | |
Outstanding at December 31, 2017 | shares | 8,171,048 |
Granted | shares | |
Exercised | shares | (3,171,048) |
Forfeited and cancelled | shares | |
Outstanding at September 30, 2018 | shares | 5,000,000 |
Aggregate Exercise Price | |
Outstanding at December 31, 2017 | $ | $ 5,743 |
Granted | $ | |
Exercised | $ | 743 |
Forfeited and cancelled | $ | |
Outstanding at September 30, 2018 | $ | $ 5,000 |
Exercise Price Range | |
Outstanding at December 31, 2017 | $ 0.0007 |
Granted | |
Exercised | 0.0002 |
Forfeited and cancelled | |
Outstanding at September 30, 2018 | 0.001 |
Weighted Average Exercise Price | |
Outstanding at December 31, 2017 | 0.0007 |
Granted | |
Exercised | 0.0002 |
Expired | |
Outstanding at September 30, 2018 | $ 0.001 |
Equity (Details Narrative)
Equity (Details Narrative) - $ / shares | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2018 | Dec. 31, 2017 | |
Capital stock, shares authorized | 100,000,000 | 100,000,000 | |
Common stock, shares authorized | 100,000,000 | 100,000,000 | 100,000,000 |
Common stock shares returned to the treasury | 30,000,000 | 30,000,000 | |
Common stock shares issued | 48,272,311 | 48,272,311 | 41,828,952 |
Common stock shares outstanding | 48,272,311 | 48,272,311 | 41,828,952 |
Stock options and Warrants [Member] | |||
Weighted average remaining contractual life | 2 years 2 months 12 days | ||
Pre-Merger [Member] | |||
Common stock shares held by shareholders | 3,272,311 | 3,272,311 | |
Exchange Agreement [Member] | Jacksam [Member] | |||
Business acquisition, equity interest issued or issuable | 45,000,000 | 45,000,000 | |
Business acquisition, par value | $ 0.001 | $ 0.001 |