UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

☒  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended: March 31, 2023

 

or

  

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from __________ to __________

 

Commission File Number: 000-52759

 

BESPOKE EXTRACTS, INC.

(Exact name of registrant as specified in its charter)

 

Nevada   20-4743354
(State or other jurisdiction 
of incorporation)		   (IRS Employer 
Identification No.)

 

12001 E. 33rd Avenue, Unit O

Aurora, CO, 80010

(Address of principal executive offices)

 

855-633-3738

(Registrant’s telephone number, including area code)

 

 

(Former name, former address and former fiscal year, if changed since last report)

 

Securities registered pursuant to Section 12(b) of the Act: None.

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months, and (2) has been subject to such filing requirements for the past 90 days.  Yes  ☒    No ☐

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes  ☒   No  ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer ☐ Accelerated filer ☐
Non-accelerated filer ☒ Smaller reporting company ☒
  Emerging growth company ☒

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐   No ☒

 

As of July 14, 2023, there were 10,168,220 shares outstanding of the registrant’s common stock, par value $0.001.

 

 

 

 

 

 

TABLE OF CONTENTS

 

    Page No. 
     
PART I - FINANCIAL INFORMATION 1
Item 1. Financial Statements 1
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 16
Item 3. Quantitative and Qualitative Disclosures About Market Risk 18
Item 4 Controls and Procedures 18
     
PART II - OTHER INFORMATION 19
Item 1. Legal Proceedings 19
Item 1A. Risk Factors 19
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 19
Item 3. Defaults Upon Senior Securities 19
Item 4. Mine Safety Disclosures 19
Item 5. Other Information 19
Item 6. Exhibits 19

 

i

 

 

PART I

 

Item 1. Financial Statements. 

 

Bespoke Extracts, Inc.

Consolidated Balance Sheets

 

   March 31,   December 31, 
   2023   2022 
         
Assets        
Current assets        
Cash  $4,365   $24,433 
Accounts receivable   46,483    
-
 
Prepaid stock awards   58,569    80,113 
Prepaid expense   26,356    7,186 
Inventory, net   13,010    
-
 
Total current assets   148,783    111,732 
           
Furniture and equipment   48,162    9,947 
License   10,000      
Right of Use Asset   259,564    275,912 
Deposits   12,000    12,000 
Total assets  $478,509   $409,591 
           
Liabilities and Stockholders’ Deficit          
Current liabilities          
Accounts payable and accrued liabilities  $492,074   $295,818 
Inventory earn-out   
-
    90,000 
Note payable - related party   692,500    415,500 
Operating lease liability   64,330    64,330 
Total current liabilities   1,248,904    865,648 
           
Long-Term Operating Lease Liability   199,889    216,039 
Total liabilities   1,448,793    1,081,687 
           
Commitments and contingencies (Note 10)   
 
    
 
 
           
Stockholders’ Deficit          
Preferred Stock, $0.001 par value, 50,000,000 shares authorized, 1 share designated;  1 share issued and outstanding as of March 31, 2023 and December 31, 2022, respectively, stated value $24,000   
-
    
-
 
Common stock, $0.001 par value: 3,000,000,000 authorized; 10,168,220 and 9,945,977 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively   10,166    9,944 
Common stock to issue 6,478 shares   
-
    
-
 
Additional paid-in capital   23,343,968    23,201,758 
Accumulated deficit   (24,324,418)   (23,883,798)
Total stockholders’ deficit   (970,284)   (672,096)
Total liabilities and stockholders’ deficit  $478,509   $409,591 

 

The accompanying notes are an integral part of these consolidated financial statements.

 

1

 

 

Bespoke Extracts, Inc.

Consolidated Statements of Operations

(Unaudited)

 

   For the three months ended
March 31,		 
   2023   2022 
         
Sales  $89,016   $3,061 
Cost of products sold   78,667    847 
Gross Profit   10,349    2,214 
           
Operating expenses:          
Selling, general and administrative expenses   374,515    897,534 
Professional fees   61,204    54,355 
Consulting   18,000    23,000 
Total operating expenses   453,719    974,889 
           
Loss from operations   (443,370)   (972,675)
           
Other income / (expenses)          
Interest income   2,750    181 
Interest expense   
-
    
-
 
Total other (expense) / income   2,750    181 
           
Loss before income tax   (440,620)   (972,494)
Provision for income tax   
-
    
-
 
Net Loss  $(440,620)  $(972,494)
           
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING          
Basic and Diluted
   10,107,108    6,992,070 
           
NET LOSS PER COMMON SHARE OUTSTANDING          
Basic and Diluted
  $(0.04)  $(0.14)

 

The accompanying notes are an integral part of these consolidated financial statements.

 

2

 

 

Bespoke Extracts, Inc.

Consolidated Statement of Stockholders Equity / (Deficit)

For The three months ended March 31, 2023 and March 31, 2022

 

   Series C                             
   Preferred   Preferred   Common   Common   Additional   Common Stock   Common Stock         
   Shares   Par   Shares   Par   Paid-in   Shares   to be issued   Accumulated     
   Outstanding   Amount   Outstanding   Amount   Capital   to be Issued   Par Amount   Deficit   Total 
                                     
Balance  December 31, 2021              1   $            -    8,141,965   $8,142   $21,741,403    6,478   $7,987   $(19,767,571)  $1,989,961 
                                              
Payment of capital contribution   -    -    -    -    4,792    -    -    -    4,792 
                                              
Stock based compensation and stock option expense   -    -    -    -    727,606    -    -    -    727,606 
                                              
Common stock issued for cash   -    -    876,667    877    196,373    -    -    -    197,250 
                                              
Net loss for the three months ended March 31, 2022   -    -    -    -    -    -    -    (972,494)   (972,494)
Balance March 31, 2022   1   $-    9,018,632   $9,019   $22,670,174   $6,478   $7,987   $(20,740,065)  $1,947,115 
                                              
Balance  December 31, 2022   -   $-    9,945,997   $9,944   $23,201,758   $-   $-   $(23,883,798)  $(672,096)
                                              
Purchase of Wonderleaf   -    -    222,223    222    49,778    -    -    -    50,000 
                                              
Stock option expense   -    -    -    -    92,432    -    -    -    92,432 
                                              
Net loss for the three months ended March 31, 2023   -    -    -    -    -    -    -    (440,620)   (440,620)
Balance March 31, 2023   1   $-    10,168,220   $10,166   $23,343,968   $-   $-   $(24,324,418)  $(970,284)

 

The accompanying notes are an integral part of these consolidated financial statements.

 

3

 

 

Bespoke Extracts, Inc.

Consolidated Statements of Cash Flows

(Unaudited)

 

   For the three months ended
March 31,		 
   2023   2022 
Cash flows from operating activities        
Net Loss  $(440,620)  $(972,494)
Adjustments to reconcile net loss to net cash used in operating activities          
Inventory reserve   40,393    
-
 
Depreciation   1,785    - 
Amortization of right of use asset, net   16,348    
-
 
Amortization expense for prepaid expenses for consulting shares   21,544    15,745 
Stock based compensation and stock option expense   92,432    727,606 
Changes in operating assets and liabilities:          
Accounts receivable   (46,483)   (64)
Prepaid expenses   (19,170)   996 
Inventory   (53,403)   355 
Interest receivable – Wonderleaf   
-
    (181)
Accounts payable and accrued liabilities   196,256    22,892 
Operating lease liability   (16,150)   (14,648)
Net Cash (used in) operating activities   (207,068)   (219,793)
           
Cash flows from investing activities          
Advances to Wonderleaf   
-
    (6,443)
Note receivable Wonderleaf funded   
-
    (20,000)
Purchase of equipment   
-
    (7,202)
Net cash used in investing activities   
-
    (33,645)
           
Cash flow from financing activities          
Payment of capital contribution   
-
    4,792 
Payment of inventory earnout   

(90,000

)   
-

Proceeds from issuance of note payable - related party   277,000    
-
 
Repayment of note payable - related party   
-
    (2,500)
Proceeds from issuance of units   
-
    197,250 
Net cash provided by financing activities   187,000    199,542 
           
Net increase / (decrease) in cash   (20,068)   (53,896)
Cash at beginning of period   24,433    148,227 
Cash at end of period  $4,365   $94,331 
           
Supplemental disclosure of cash flow information          
Cash paid for interest  $
-
   $
-
 
Cash paid for income taxes  $
-
   $
-
 
           
Noncash investing and financing activities:          
Stock issued to Wonderleaf for fixed assets and license  $50,000   $
-
 

 

The accompanying notes are an integral part of these consolidated financial statements.

 

4

 

 

BESPOKE EXTRACTS, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2023

(Unaudited)

 

1. NATURE OF OPERATIONS, SIGNIFICANT ACCOUNTING POLICIES AND GOING CONCERN

 

Nature of Business Operations 

 

Bespoke Extracts, Inc. (the “Company”) is a Nevada corporation focused on operating in the regulated cannabis markets in the United States. Through Bespoke Colorado, we operate a marijuana infused products production facility in Aurora, Colorado.

  

On December 2, 2021, Bespoke Extracts Colorado, LLC (“Bespoke Colorado”), a newly formed wholly-owned subsidiary of the Company entered into an asset purchase agreement with WonderLeaf, LLC (“WonderLeaf”), and on December 7, 2021, Bespoke Colorado and WonderLeaf entered into an amendment to such asset purchase agreement (as amended, the “WonderLeaf Purchase Agreement”).. On January 3, 2023, the Company completed the acquisition of the WonderLeaf assets and the change of control was approved by the Colorado Marijuana Enforcement Division for 222,223 shares of common stock valued at $50,000, or $0.225 per share. At the time of acquisition Wonderleaf had no operations or no employees and was not considered a business. 

 

On February 2, 2022, the Company changed its fiscal year from August 31 to December 31.

 

Certain prior period amounts have been reclassified to conform to the current period presentation which include common stock and additional paid in capital.

 

Principles of Consolidation

 
The accompanying condensed consolidated unaudited financial statements include the accounts of Bespoke Extracts, Inc., and its wholly owned subsidiary Bespoke Extracts Colorado, LLC. All inter-company balances have been eliminated.

 

Going Concern

 

The accompanying condensed consolidated unaudited financial statements have been prepared assuming a continuation of the Company as a going concern. The Company had negative cash flows from operations of $207,068 for the three months ended March 31, 2023, and a working capital deficit of $1,100,121 and accumulated deficit of $24,324,418 as of March 31, 2023. This raises substantial doubt about our ability to continue as a going concern for a period of one year from the date of these financial statements.

 

The Company’s ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or obtaining the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. There is no assurance that this series of events will be satisfactorily completed.

 

Further, if we issue additional equity or debt securities, stockholders may experience additional dilution or the new equity securities may have rights, preferences or privileges senior to those of existing holders of our common stock. If additional financing is not available or is not available on acceptable terms, we will have to curtail or cease our operations. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event the Company cannot continue in existence. These financial statements do not include any adjustments that might arise from this uncertainty.

 

5

 

 

Use of Estimates

 

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the accompanying consolidated financial statements and accompanying notes. Significant estimates include the assumption used in the valuation of equity-based transactions, valuation of intangible assets, allowance for doubtful accounts and inventory valuation and reserves. Actual results could differ from those estimates. 

 

Cash and Cash Equivalents

 

Cash and cash equivalents include all highly liquid investments with original maturities of three months or less at the time of purchase. At March 31, 2023 and December 31, 2022, the Company did not have any cash equivalents. The Company did not have any cash in excess of FDIC limits of $250,000 at any single bank.

 

Fair Value of Financial Instruments

 

The carrying amounts of cash, accounts receivable, inventory, fixed assets, licenses, and other assets, accounts payable, accrued liabilities, note payable and convertible note payable approximate their fair values as of March 31, 2023 and December 31, 2022, respectively, because of their short-term natures and the Company’s borrowing rate of interest.

 

Accounts Receivable

 

Accounts receivable are recorded at fair value on the date revenue is recognized. The Company provides allowances for doubtful accounts for estimated losses resulting from the inability of its customers to repay their obligation. If the financial condition of the Company’s customers were to deteriorate, resulting in an impairment of their ability to repay, additional allowances may be required. The Company provides for potential uncollectible accounts receivable based on specific customer identification and historical collection experience adjusted for existing market conditions. If market conditions decline, actual collection experience may not meet expectations and may result in decreased cash flows and increased bad debt expense.

 

The policy for determining past due status is based on the contractual payment terms of each customer, which are generally net 30 or net 60 days. Once collection efforts by the Company and its collection agency are exhausted, the determination for charging off uncollectible receivables is made. At March 31, 2023 and December 31, 2022, the Company has recorded an allowance for doubtful accounts of $0 and $0, respectively.

 

Inventory, Net

 

Inventories are stated at the lower of cost or net realizable value. Cost is determined by the first-in, first-out basis and net realizable value. Net realizable value is defined as sales price less cost of completion, disposition and transportation and a normal profit margin. As of March 31, 2023 and December 31, 2022, inventory amounted to $13,010 and $0 net of reserves, respectively, which consisted of finished goods of $13,010 and $0, and raw materials of $0 and $0, respectively.

 

Property and equipment

 

Property and equipment is recorded at cost and capitalized from the initial date of service. Expenditures for major additions and improvements are capitalized and minor replacements, maintenance, and repairs are charged to expense as incurred. When property and equipment is retired or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is included in the results of operations for the respective period. Depreciation is provided over the estimated useful lives of the related assets using the straight-line method for financial statement purposes. The Company uses other depreciation methods (generally accelerated) for tax purposes where appropriate. The estimated useful lives for significant property and equipment categories are as follows:

 

Schedule of Estimated useful Lives of Property and Equipment

 

Furniture and Equipment   5 years 

 

License

 

License represents the Colorado license distributing cannabis. The license will be amortized over its useful life.

 

6

 

 

Revenue Recognition

 

We account for revenue in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification Topic 606, “Revenue from Contracts with Customers”. Revenue is measured based on the amount of consideration that we expect to receive, reduced by discounts and estimates for credits and returns (calculated based upon previous experience and management’s evaluation). Outbound shipping charged to customers is recognized at the time the related merchandise revenues are recognized and are included in net revenues. Inbound and outbound shipping and delivery costs are included in cost of revenues.

 

Our products are sold directly to licensed marijuana dispensaries in Colorado. Revenue is recognized when control of the merchandise is transferred to the customer, which generally occurs upon shipment. Payment is typically due on the date of shipment [or within 15 days].

 

At March 31, 2023, two customers amounted to 27.5% and 31.4% amounted, or 58.9% of accounts receivable. During the year ended December 31, 2022 no customer amounted to over 10% of the total accounts receivable. During the three months ended March 31, 2023 three customers amounted to 14.4%, 15.1% and 16.4%, or 45.9% of sales for the period. During the three months ended March 31, 2022 no individual customer amounted to over 10% of tota1 sales.

 

Stock Based Compensation

 

Stock options and warrants issued to consultants and other non-employees as compensation for services provided to the Company are accounted for based on the fair value of the services provided or the estimated fair market value of the option or warrant, whichever is more reliably measurable, and in accordance with FASB ASC 718, Compensation-Stock Compensation, including related amendments and interpretations.

 

Reclassification

 

Prior gross prepaid stock compensation and additional paid in capital presented in the 10Q for the period end March 31, 2022 have been reclassified to conform with the financials filed in the December 31, 2022 10K.

 

Net Income / (Loss) per Share

 

Basic income / (loss) per share amounts are computed based on net income / (loss) divided by the weighted average number of common shares outstanding. Diluted earnings per share reflect the potential dilution that could occur if potentially dilutive securities were exercised or converted to common stock. The dilutive effect of options and warrants and their equivalent is computed by application of the treasury stock method and the effect of convertible securities by the “if converted” method. The effect of 219,556 warrants and 1,023,842 options is anti-dilutive for the three months ended March 31, 2023 as they are not in the money. The effect of 562.967 warrants and 1,022,842 options is anti-dilutive for the three months ended March 31, 2022 as they are not in the money. 

 

Reverse Stock Split

 

On December 5, 2022 the Company approved an amendment to its articles of incorporation to effect a 45-to-1 reverse split of our common stock effective January 13, 2023. All prior equity amounts have been presented to reflect this split.

 

Recent accounting pronouncements

 

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) or other standard setting bodies that are adopted by the Company as of the specified effective date.

 

7

 

 

Income Taxes

 

We utilize the asset and liability method of accounting for income taxes. We recognize deferred tax liabilities or assets for the expected future tax consequences of temporary differences between the book and tax basis of assets and liabilities. We regularly assess the likelihood that our deferred tax assets will be recovered from future taxable income. We consider projected future taxable income and ongoing tax planning strategies in assessing the amount of the valuation allowance necessary to offset our deferred tax assets that will not be recoverable. We have recorded and continue to carry a full valuation allowance against our gross deferred tax assets that will not reverse against deferred tax liabilities within the scheduled reversal period. If we determine in the future that it is more likely than not that we will realize all or a portion of our deferred tax assets, we will adjust our valuation allowance in the period we make the determination. We expect to provide a full valuation allowance on our future tax benefits until we can sustain a level of profitability that demonstrates our ability to realize these assets.

 

2. ASSET PURCHASE AGREEMENT

 

On January 3, 2023, the Company completed the acquisition of the WonderLeaf assets for 222,223 shares of common stock valued at $50,000, or $0.225 per share. At the time of acquisition Wonderleaf had no operations or no employees and was not considered a business. 

 

Pursuant to ASU 2017-01 and ASC 805, the Company analyzed the business of Wonderleaf to determine if the Company acquired a business or acquired assets. Based on this analysis, the Company determined that it acquired assets. No goodwill was recorded since the purchase was accounted for as an asset purchase. In accordance with ASC 805, the fair value of the assets acquired is based on either the fair value of the consideration given or the fair value of the assets acquired, whichever is more clearly evident, and thus, more reliably measurable. The Company used the market price of the 222,223 common shares issued of $50,000 as the fair value of the assets acquired since this value was more clearly evident, and thus, more reliably measurable than the fair value of the license and fixed assets acquired.

 

Company management determined if the Company acquired a business or acquired assets. The FASB issued new guidance (ASU 2017-01) that changed the definition of a business to assist entities with evaluating when a set of transferred assets and activities is a business. The guidance requires an entity to evaluate if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets; if so, the set of transferred assets and activities is not a business. The guidance also requires a business to include at least one substantive process and narrows the definition of outputs by more closely aligning it with how outputs are described in ASC 606. Under the new guidance, an entity first determines whether substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets. If this threshold is met, the set is not a business. If it’s not met, the entity then evaluates whether the set meets the requirement that a business include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create outputs. Under the ASU, a set is not a business when substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets.

 

Pursuant to 805-10-55-83, the Company first considered the guidance in paragraphs 805-10-55-5A through 55-5C. The identifiable assets that could be recognized in the purchase only included the license and fixed assets. Accordingly, the transaction was not considered a business.

 

The monetary value of the 222,223 shares is deemed by the Company to be $50,000 in accordance with Accounting Standards Codification (“ASC”) 805-50-30 “Business Combinations”, the Company determined that if the consideration paid is not in the form of cash, the measurement may be based on either (i) the cost which is measured based on the fair value of the consideration given or (ii) the fair value of the assets (or net assets) acquired, whichever is more clearly evident and thus more reliably measurable. No goodwill should be recorded since the WPA was accounting for as an asset purchase. The Company determined that the fair value of the common shares issued was a better indicator which is more reliably measurable.

 

The Company assigned a value of $10,000 to the licenses and $40,000 to the fixed assets acquired.

 

3. INVENTORY EARN-OUT 

 

As described in Note 9, in exchange for cancellation of the debt owed under the Debenture, the Company transferred to the holder certain domain names and agreed to pay the holder, beginning December 1, 2021, and on a monthly basis through August 31, 2022, 40% of the operating profit generated from sale of the existing CBD inventory of the Company, and on August 31, 2022, to make a final payment equal to an amount of $75,000 minus the total of the monthly payments made under the Inventory Earn Out. As of December 31, 2022 no amounts had been paid. The inventory earn-out agreement was amended on November 11, 2022 such that the final payment under the inventory earn out was increased to $90,000 (less any payments previously made) and was due February 28, 2023. During the three months ended March 31, 2023 the amount was paid.

 

8

 

 

4. NOTE RECEIVABLE 

 

On January 19, 2022 the Company loaned WonderLeaf $10,000, pursuant to a promissory note. The note bears interest at 5% annually and matures on January 18, 2023.

 

On February 8, 2022 the Company loaned WonderLeaf $10,000, pursuant to a promissory note. The note bears interest at 5% annually and matures on February 8, 2023.

 

On October 25, 2022 the Company loaned WonderLeaf $25,000, pursuant to a promissory note. The note bears interest at 5% annually and matures on February 8, 2023.

 

As of December 31, 2022 accrued interest on the notes receivable amounted to $931.

 

At December 31, 2022 the Company recorded a reserve of $45,931 for the promissory notes and accrued interest.

 

Note 5 – Furniture and equipment.

 

Machinery and equipment consisted of the following at:

 

Schedule of Machinery and Equipment

 

   March 31,
2023		   December 31,
2022		 
Furniture and equipment  $2,745   $2,745 
Machinery and Equipment  $47,202   $7,202 
Fixed assets, total  $49,947   $9,947 
Total: accumulated depreciation  $(1,785)  $
-
 
Fixed assets, net  $48,162   $9,947 

 

Depreciation expense for the three months ended March 31, 2023 and March 31, 2022 were $1,785 and $0 respectively.

 

6. NOTE PAYABLE – RELATED PARTY

 

During the three months ended March 31, 2023, Michael Feinsod, the Company’s chief executive officer, loaned the Company an additional $227,000. As of March 31, 2023 and December 31, 2022 the amount owed Michael Feinsod is $692,500 and $415,500, respectively. All loans are payable upon demand.

   

7. LEASES

 

In connection with the WonderLeaf Purchase Agreement, Bespoke Colorado entered into a lease agreement (the “Lease”) with WL Holdings, Ltd. (“WL Holdings”) in December 2021. Pursuant to the Lease, Bespoke Colorado will lease from WL Holdings certain commercial space in Aurora, Colorado, where WonderLeaf’s business has been located, commencing upon signing of the Lease and Wonderleaf Purchase Agreement, for a term of five years, which Bespoke Colorado will have an option to renew for an additional five years. Monthly rent under the Lease will start at $6,000. The Lease grants the Company an option to purchase the property for $600,000. The Company has not decided whether it will exercise either option.

 

Supplemental balance sheet information related to leases was as follows:

 

Lease term and discount rate were as follows:

 

   March  31, 
   2023 
Weighted average remaining lease term (years)   3.69 
Weighted average discount rate   4%

 

9

 

 

The component of lease costs was as follows:

 

   Three Months ended
March  31,		 
   2023 
Operating lease cost  $19,093 
Variable lease cost (1)   1,050 
Total lease costs  $20,143 

 

(1) Variable lease cost primarily relates to common area maintenance, property taxes and insurance on leased real estate.

 

Supplemental disclosures of cash flow information related to leases were as follows:

 

   March 31, 
   2023 
Cash paid for operating lease liabilities  $
    -
 

 

Maturities of lease liabilities were as follows as of March 31, 2023:

 

    Operating  
    Leases  
2023   $ 56,700  
2024     75,915  
2025     79,380  
2026     72,765  
Thereafter     -  
Total undiscounted lease payments     284,760  
Less: Present value discount     (23,291 )
Total Present value of lease liabilities   $ 264,219  

 

Operating Leases   Classification   March 31,
2023		  
Right-of-use assets   Right of use assets   $ 259,564  
             
Current lease liabilities   Current operating lease liabilities     64,330  
Non-current lease liabilities   Long-term operating lease liabilities     199,889  
Total lease liabilities       $ 264,219  

 

8. EQUITY

 

Common Stock and Preferred Stock

 

On December 5, 2022 the Company approved an amendment to its articles of incorporation to effect a 45-to-1 reverse split of our common stock effective January 13, 2023. All prior amounts equity amounts have been presented to reflect this reverse split.

 

10

 

 

As of March 31, 2023 and December 31, 2022, the Company’s authorized capital stock consists of 3,000,000,000 shares of common stock, par value $0.001, and 50,000,000 shares of preferred stock, par value $0.001. 1,000 shares of preferred stock are designated as Series A Convertible Preferred Stock. No shares of Series A Preferred Stock are issued and outstanding as of March 31, 2023 and December 31, 2022, respectively. The Company’s Certificate of Designation of Series B Preferred Stock was withdrawn by the Company on June 30, 2020. 1 share of preferred stock is designated Series C Preferred Stock and is issued and outstanding as of March 31, 2023 and December 31, 2022, respectively. The Series C Preferred Stock has a stated value of $24,000 and entitles the holder to 51% of the total voting power of the Company’s stockholders. The Company may, in its sole discretion, redeem the Series C Preferred Stock at any time for a redemption price equal to the stated value. Upon payment of the redemption price by the Company, the Series C Preferred Stock will revert to the status of authorized but unissued preferred stock. 

 

On January 3, 2023, the Company completed the acquisition of the WonderLeaf assets for 222,223 shares of common stock valued at $50,000, or $0.225 per share.

 

On December 14, 2021, the board of directors of the Company adopted the Company’s 2021 Equity Incentive Plan (the “2021 Plan”), pursuant to which up to an aggregate of 6,666,667 shares of common stock are available for issuance. Awards under the plan may include options (including incentive stock options and non-qualified stock options), stock appreciation rights, restricted stock, restricted stock units, performance share awards, or other equity-based awards, each as defined under the 2021 Plan. Options awarded under the 2021 Plan are to have an exercise price of not less than 100% of the fair market value of the common stock on the grant date and a term of not more than ten years from the option grant date.

 

On December 14, 2021, the Company entered into an employment agreement with Hunter Garth. Pursuant to the employment agreement, Mr. Garth will serve as the Company’s president and will receive a base monthly salary of $8,000. The Company also granted to Mr. Garth, pursuant to the Company’s 2021 Equity Incentive Plan, 500,000 shares of restricted common stock valued at $675,000 ($1.35 per share), which vested one year from the date of grant. During the year ended December 31, 2022 the Company recorded $675,000 a prepaid expenses associated with the stock based compensation. During the years ended December 31, 2022 and 2021 the amount was amortized $643,562 and $31,438, respectively.

   

On December 14, 2021, the Company entered into an employment agreement with Michael Feinsod, the Company’s chief executive officer and chairman. Pursuant to the employment agreement, Mr. Feinsod will continue to serve as the Company’s chief executive officer and chairman and will receive a base monthly salary of $10,000. The Company also granted to Mr. Feinsod, pursuant to the Company’s 2021 Equity Incentive Plan, 1,000,000 shares of restricted common stock valued at $1,350,000 ($1.35 per share), which vested one year from the date of grant. During the year ended December 31, 2022 the Company recorded $1,350,000 of prepaid expenses associated with the stock based compensation. During the years ended December 31, 2022 and 2021 the amount was amortized $1,287,123 and $62,877, respectively. As of December 31. 2022 and 2021 the Company recorded a prepaid stock award of $0 and $1,287,123, respectively.

 

During the year ended December 31, 2022, the Company entered into and closed securities purchase agreements with investors pursuant to which the Company issued and sold to the investors an aggregate of 1,530,897 shares of common stock and warrants to purchase an aggregate of 1,530,897 shares of common stock, for an aggregate purchase price of $344,450. The warrants expired June 30, 2023 and had an exercise price of $2.25.

 

Effective August 1, 2022, the Company issued an aggregate of 266,667 shares of common stock to employees and consultants for services, including 155,556 shares that vest immediately, 55,556 shares that vested one year from the grant date, and 55,556 shares that will vest two years from the grant date. During the year ended December 31, 2022 the Company recorded an expense $1,104,928. For the three months ended March 31, 2023 the Company recorded an expense of $21,544. As of March 31, 2023 and December 31, 2022 the Company had a prepaid stock award of $58,569 and $80,113.

 

11

 

 

Warrants

 

During the four months ended December 31, 2021, the Company entered into and closed securities purchase agreements with investors pursuant to which the Company issued and sold to the investors an aggregate of 50,000,000 shares of common stock and warrants to purchase an aggregate of 12,500,000 shares of common stock, for an aggregate purchase price of $250,000 with offering costs of $10,000 for legal expenses. The warrants had a term of one year and an exercise price of $2.25.

 

During the year ended December 31, 2022, the Company entered into and closed securities purchase agreements with investors pursuant to which the Company issued and sold to the investors an aggregate of 1,530,887 shares of common stock and warrants to purchase an aggregate of 382,722 shares of common stock, for an aggregate purchase price of $344,450. The warrants expired June 30, 2023 and had an exercise price of $2.25.

 

The following table summarizes the warrant activities during the three months ended March 31, 2023:

 

   Number of
Warrants		   Weighted-
Average
Exercise
Price Per
Share		   Weighted-
Average
Remaining
Life		 
Outstanding at August 31, 2022   438,723    5.03    0.36 
Granted   
-
    
-
    
-
 
Canceled or expired   (219,167)   2.45    
-
 
Outstanding at March 31, 2023   219,556   $7.81    0.33 years 
Exercisable at March 31, 2023   219,556   $7.81    0.33 years 
Intrinsic value at March 31, 2023       $
-
      

  

Options

 

On December 14, 2021, the Company entered into an employment agreement with Hunter Garth, wherein the Company granted to Mr. Garth, pursuant to the Company’s 2021 Equity Incentive Plan, ten-year options to purchase 333,333 shares of common stock at an exercise price of $2.70 (representing a 120% premium over the closing price of the common stock on December 13, 2021). One-third of the options will vest on each yearly anniversary of the date of grant. The options were valued at $450,000 using a Black-Scholes pricing model. During the three months ending March 31, 2023 and 2022 the Company recorded $30,811 and $97,797 respectively of expenses associated with the vesting of these stock options. (See notes 9 and 10).

 

On December 14, 2021, the Company entered into an employment agreement with Michael Feinsod, wherein the Company granted to Mr. Feinsod, pursuant to the Company’s 2021 Equity Incentive Plan, ten-year options to purchase 666,667 shares of common stock at an exercise price of $2.70 (representing a 120% premium over the closing price of the common stock on December 13, 2021). One-third of the options will vest on each yearly anniversary of the date of grant. The options were valued at $900,000 using a Black-Scholes pricing model. During the three months ended March 31, 2023 and 2022 the Company recorded $61,621 and $135,594, respectively of expenses associated with the vesting of these stock options. (See notes 9 and 10).

 

On December 14, 2021, the Company issued to a consultant options to purchase 22,222 shares of common stock at an exercise price of $1.35. The options vest over a period of 3 months and have a term of 10 years. The options were valued at $30,000 using a Black-Scholes pricing model. During the three months ended March 31, 2023 and 2022 the Company recorded $0 and $24,900, respectively of expenses associated with the vesting of these stock options.

 

12

 

 

The following table summarizes the option activities during the four months ended December 31, 2021 and the year ended December 31, 2022:

 

   Number of
Options		   Weighted-
Average Exercise
Price Per
Share		   Weighted-
Average
Remaining
Life		 
Outstanding at December 31, 2022   1,023,842    2.67    8.95 years 
Granted   
-
    
-
    
 
 
Canceled or expired   
-
    
-
      
Exercised   
-
    
-
      
Outstanding at March 31, 2023   1,023,842   $2.67    8.71 years 
Exercisable at March  31, 2023   357,174   $2.67    8.69 years 
Intrinsic value at March 31, 2023       $
-
      

 

The future expense as of March 31, 2023 is $420,381.

 

9. RELATED PARTY TRANSACTIONS

  

On December 14, 2021, the Company entered into an employment agreement with Hunter Garth. Pursuant to the employment agreement, Mr. Garth will serve as the Company’s president and will receive a base monthly salary of $8,000. The Company also granted to Mr. Garth, pursuant to the Company’s 2021 Equity Incentive Plan, 500,000 shares of restricted common stock, which vested one year from the date of grant, and ten-year options to purchase 333,333 shares of common stock at an exercise price of $2.70 (representing a 120% premium over the closing price of the common stock on December 13, 2021). One-third of the options will vest on each yearly anniversary of the date of grant. In the event that Mr. Garth is terminated without cause or resigns with good reason (each as defined in the employment agreement), he will be entitled to his monthly base salary for twelve months following such termination.

  

On December 14, 2021, the Company entered into an employment agreement with Michael Feinsod, the Company’s chief executive officer and chairman. Pursuant to the employment agreement, Mr. Feinsod will continue to serve as the Company’s chief executive officer and chairman and will receive a base monthly salary of $10,000. The Company also granted to Mr. Feinsod, pursuant to the Company’s 2021 Equity Incentive Plan, 1,000,000 shares of restricted common stock, which vested one year from the date of grant, and ten-year options to purchase 666,667 shares of common stock at an exercise price of $2.70 (representing a 120% premium over the closing price of the common stock on December 13, 2021). One-third of the options will vest on each yearly anniversary of the date of grant. In the event that Mr. Feinsod is terminated without cause or resigns with good reason (each as defined in the employment agreement), he will be entitled to his monthly base salary for twelve months following such termination.

 

13

 

 

During the year ended December 31, 2022, Michael Feinsod, the Company’s chief executive officer, advanced the Company $415,500 and was repaid $2,500 for operations. During the three months ended March 31, 2023 Michael Feinsod advanced an additional $277,000. The loans are non-interest bearing and payable upon demand. (See Note 6.)

 

As of March 31, 2023 Michael Feinsod is owed a total of $105,000 of accrued salary and accounts payable of $78,936.

 

10. COMMITMENTS AND CONTINGENCIES

 

In connection with a stock purchase agreement, on October 28, 2021, a convertible debenture with an original issue date of December 24, 2019, as amended by Amendment No. 1 thereto, dated May 28, 2020, Amendment No. 2 thereto, dated August 21, 2020, Amendment No. 3 thereto, dated December 10, 2020, Amendment No. 4 thereto, dated January 15, 2021, Amendment No. 5 thereto, dated April 2, 2021, and Amendment No. 6 thereto, dated August 2, 2021 (as amended, the “Debenture”) with an original principal amount of approximately $400,000 was terminated, and all amounts due and payable thereunder forgiven pursuant to a cancellation and satisfaction of debenture agreement entered into between the Company and the Debenture holder (the “Debt Cancellation Agreement”). In exchange for cancellation of the debt owed under the Debenture, the Company transferred to the holder certain domain names and agreed to pay the holder, beginning December 1, 2021, and on a monthly basis through August 31, 2022, 40% of the operating profit generated from sale of the existing CBD inventory of the Company (the “Inventory Earn Out”), and on August 31, 2022, to make a final payment equal to an amount of $75,000 minus the total of the monthly payments made under the Inventory Earn Out. The inventory earn-out agreement was amended on November 11, 2022 (see Note 3) such that the final payment under the inventory earn out was increased to $90,000 (less any payments previously made) and was due February 28, 2023. During the three months ended March 31, 2023 the amount was paid.

 

14

 

 

On December 14, 2021, the Company entered into an employment agreement with Hunter Garth. Pursuant to the employment agreement, Mr. Garth will serve as the Company’s president and will receive a base monthly salary of $8,000. The Company also granted to Mr. Garth, pursuant to the Company’s 2021 Equity Incentive Plan, 500,000 shares of restricted common stock, which vested one year from the date of grant, and ten-year options to purchase 333,333 shares of common stock at an exercise price of $2.70 (representing a 120% premium over the closing price of the common stock on December 13, 2021). One-third of the options will vest on each yearly anniversary of the date of grant. In the event that Mr. Garth is terminated without cause or resigns with good reason (each as defined in the employment agreement), he will be entitled to his monthly base salary for twelve months following such termination.

  

On December 14, 2021, the Company entered into an employment agreement with Michael Feinsod, the Company’s chief executive officer and chairman. Pursuant to the employment agreement, Mr. Feinsod will continue to serve as the Company’s chief executive officer and chairman and will receive a base monthly salary of $10,000. The Company also granted to Mr. Feinsod, pursuant to the Company’s 2021 Equity Incentive Plan, 1,000,000 shares of restricted common stock, which vested one year from the date of grant, and ten-year options to purchase 666,667 shares of common stock at an exercise price of $0.06 (representing a 120% premium over the closing price of the common stock on December 13, 2021). One-third of the options will vest on each yearly anniversary of the date of grant. In the event that Mr. Feinsod is terminated without cause or resigns with good reason (each as defined in the employment agreement), he will be entitled to his monthly base salary for twelve months following such termination.

 

On August 11, 2022, the Company and Bespoke Colorado entered into an asset purchase agreement with Osiris, LLC doing business as Best Day Ever (“BDE”) and Michael Gurtman. Pursuant to the purchase agreement, Bespoke Colorado agreed to purchase from BDE, and BDE agreed to sell to Bespoke Colorado, the assets of BDE, including certain licenses. The Company also agreed to assume certain leases, all as further set forth in the purchase agreement. As consideration for the acquisition of the assets, the Company agreed to issue 2,777,778 shares of common stock at the closing of the transaction. Closing of the purchase agreement was subject to receipt of certain governmental approvals and other customary closing conditions. The purchase agreement was terminated on November 18, 2022.

 

11. SUBSEQUENT EVENTS

 

Subsequent to March 31, 2023 , the Company’s chief executive officer, loaned the Company an additional $157,000.

 

15

 

 

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

 

We and our representatives may from time to time make written or oral statements that are “forward-looking,” including statements contained in this report and other filings with the SEC, reports to our stockholders and news releases. All statements that express expectations, estimates, forecasts or projections are forward-looking statements. In addition, other written or oral statements which constitute forward-looking statements may be made by us or on our behalf. Words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “estimate,” “project,” “forecast,” “may,” “should,” and variations of such words and similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions which are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in or suggested by such forward-looking statements. We undertake no obligation to update or revise any of the forward-looking statements after the date of this report to conform forward-looking statements to actual results, except as may be required under applicable law. Important factors on which such statements are based are assumptions concerning uncertainties, including but not limited to, uncertainties associated with the following:

 

  ● Inadequate capital and barriers to raising the additional capital or to obtaining the financing needed to implement our business plans;

 

  ● Our failure to earn significant revenues or profits;

 

  ● Volatility, lack of liquidity or decline of our stock price;

 

  ● Potential fluctuation in quarterly results;

 

  ● Rapid and significant changes in markets; and

 

  ● Insufficient revenues to cover operating costs.

  

The following discussion should be read in conjunction with the financial statements and the notes thereto which are included in this report.

 

Overview

 

Through our wholly-owned subsidiary, Bespoke Extracts Colorado, LLC, we operate a marijuana infused products manufacturing facility in Colorado.

 

In November 2021, new management of the Company was appointed and the Company began to focus on other complimentary lines of business to its CBD offerings. Under our new management team, we plan to expand the Company’s focus to regulated cannabis markets in the United States.

 

On December 2, 2021, Bespoke Extracts Colorado, LLC, a newly formed wholly-owned subsidiary of the Company entered into an asset purchase agreement with WonderLeaf, and on December 7, 2021, Bespoke Colorado and WonderLeaf entered into an amendment to such asset purchase agreement (as amended, the “WonderLeaf Purchase Agreement”). Pursuant to the Wonderleaf Purchase Agreement, Bespoke Colorado agreed to purchase from WonderLeaf, and WonderLeaf agreed to sell to Bespoke Colorado, certain assets of WonderLeaf, including a license to manufacture marijuana-infused products, existing inventory, and extraction equipment and ancillary items, all as further set forth in the Wonderleaf Purchase Agreement, for a purchase price of $50,000, to be paid in shares of common stock of the Company. The Company issued a total of 222,223 shares of common stock ($0.225 per share), the fair market value on the date of issuance.

 

16

 

 

Results of Operations for the three months ended March 31, 2023 and March 31, 2022

 

Sales

 

Sales during the three months ended March 31, 2023 were $89,016 compared to $3,061 for the three months ended March 31, 2022. The increase in sales was a direct result of the products we are now producing after the purchase of Wonderleaf. The increase in sales was due to direct sales of pre-rolled joints to licensed dispensaries in Colorado.

 

Cost of Goods Sold

 

Cost of goods sold for the three months ended March 31, 2023 was $78,667 compared to $847 for the three months ended March 31, 2022. The increase was a direct result of the increase in sales. The increase in cost of sales was due to increases in purchases of raw materials, packaging, and labor associated with the production of pre-rolled joints.

 

Operating Expenses

 

Selling, general and administrative expenses for the three months March 31, 2023 and March 31, 2022 were $375,415 and $897,534, respectively. The decrease was mainly attributable to stock-based compensation of $92,432 for the three months ended March 31, 2023 compare to $727,606 for the three months ended March 31, 2022 and were partially offset by increase in salaries. Professional fees were $61,240 and $54,355, respectively for the three months ended March 31, 2023 and March 31, 2022. The increase in expenses was due to increased legal and accounting fees associated with the WonderLeaf, LLC acquisition. Consulting expense was $18,000 and $23,000, for the three months ended March 31, 2023 and March 31, 2022, respectively.  

 

Net Loss

 

Our net loss for the three months ended March 31, 2023 was $440,620, or $0.04 per share, compared to a net loss for the three months ended March 31, 2022 of $972,494, or $0.14 per share.

 

Investing Activities

 

During the three months ended March 31, 2022 the Company loaned Wonderleaf a total of $20,000 pursuant to promissory notes, advanced Wonderleaf $6,443 and purchased $7,202 of equipment.

 

Liquidity and Capital Resources

 

As of March 31, 2023, we had cash of $4,365. Net cash used in operating activities for the three months ended March 31, 2023 was $207,068. Our current liabilities as of March 31, 2023 were $1,248,904 and consisted of accounts payable and accrued liabilities of $492,074, current portion of lease liability of $64,330 and notes payable related party of $692,500. As of March 31, 2022, we had cash of $94,331. Net cash used in operating activities for the three months ended March 31, 2022 was $219,793. Our current liabilities as of March 31, 2022 were $241,900 and consisted of accounts payable and accrued liabilities of $105,621, an inventory earn-out of $75,000 and current portion of lease liability of $61,279. 

 

During the three months ended March 31, 2023 the Company borrowed an additional $277,000 from a related party and repaid $90,000 owed for an inventory earnout. During the three months ended March 31, 2022, the Company repaid $2,500 of a note payable from a related party. In addition, the Company raised a total of $197,250 from the sale of common stock and warrants.

 

The unaudited condensed consolidated financial statements included in this report have been prepared assuming a continuation of the Company as a going concern. The Company had negative cash flows from operations for the three months ended March 31, 2023 and the year ended December 31, 2022 and had a working capital deficit at March 31, 2023 and December 31, 2022. This raises substantial doubt about our ability to continue as a going concern.

 

We have not generated positive cash flows from operating activities. Our primary source of capital has been from the sale of equity and convertible debt securities. Our primary use of capital has been for professional fees and selling, general and administrative costs. We have no committed sources of capital and will need to raise additional capital to continue and expand our operations. Additional capital may not be available on terms acceptable to us, or at all.

 

In addition, the COVID-19 pandemic may negatively affect our operations, including by limiting access to our facilities, customers, management, and professional advisors, and by causing delays and constraints in manufacturing and shipping of our products. These factors, in turn, may negatively impact our operations, financial condition and demand for our products, and our ability to raise capital on acceptable terms, or at all.

 

17

 

 

Off-Balance Sheet Arrangements

 

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

 

Critical accounting policies and estimates

  

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

 

Not required for smaller reporting companies.

 

Item 4. Controls and Procedures.

 

Evaluation of Disclosure Controls and Procedures

 

Management of the Company conducted an evaluation of the effectiveness of the Company’s disclosure controls and procedures (as such term is defined in Rule 13a-15(e) and Rule 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report. The Company’s disclosure controls and procedures are designed to ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is (i) recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms, and (ii) accumulated and communicated to our management, including our principal executive officer and principal financial officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

 

Based on this evaluation, our management has concluded that the design and operation of our disclosure controls and procedures are not effective since the following material weaknesses exist:

 

  ● Our chief executive officer also functions as our principal financial officer. As a result, our officer may not be able to identify errors and irregularities in the financial statements and reports;

 

  ● We were unable to maintain full segregation of duties within our financial operations due to our reliance on limited personnel in the finance function. While this control deficiency did not result in any audit adjustments to our financial statements, it could have resulted in a material misstatement that might have been prevented or detected by a segregation of duties; and

 

  ● Documentation of all proper accounting procedures is not yet complete.

 

To the extent reasonably possible given our limited resources, we intend to take measures to cure the aforementioned weaknesses, including, but not limited to, increasing the capacity of our qualified financial personnel to ensure that accounting policies and procedures are consistent across the organization and that we have adequate control over financial statement disclosures.

 

Changes in Internal Control over Financial Reporting

 

There were no changes in our internal control over financial reporting that occurred during the last fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

18

 

 

PART II – OTHER INFORMATION

 

Item 1. Legal Proceedings.

 

We are not currently a party to, nor are any of our property currently the subject of, any material legal proceedings. 

 

Item 1A. Risk Factors.

 

Not required for smaller reporting companies. 

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

 

None.

 

Item 3. Defaults Upon Senior Securities.

 

None.

 

Item 4. Mine Safety Disclosures.

 

No disclosure required. 

 

Item 5. Other Information.

 

None.

 

Item 6. Exhibits.

 

Exhibit No.   Description
     
31.1   Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*
32.1   Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002**
101.INS   Inline XBRL Instance Document
101.SCH   Inline XBRL Taxonomy Extension Schema Document.
101.CAL   Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF   Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB   Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE   Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104   Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

  

*Filed herewith.

 

**Furnished herewith.

 

19

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

  BESPOKE EXTRACTS, INC.
     
Dated: July 14, 2023 By: /s/ Michael Feinsod
   

Michael Feinsod

Chief Executive Officer

    (Principal Executive Officer,
Principal Financial Officer and
Principal Accounting Officer)

 

 

20

 

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Exhibit 31.1

 

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Michael Feinsod, certify that:

 

1) I have reviewed this Quarterly Report on Form 10-Q of Bespoke Extracts, Inc. (the “registrant”);

 

2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by the report;

 

3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the issuer as of, and for, the periods presented in this report;

 

4) The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

  a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

  b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

  c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

  d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5) The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

  a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

  b) Any fraud, whether or not material, that involved management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

/s/ Michael Feinsod  
Michael Feinsod  

Chief Executive Officer (Principal Executive Officer

and Principal Financial Officer)

  
   
July 14, 2023  

 

 

Exhibit 32.1

 

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF

THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Quarterly Report on Form 10-Q of Bespoke Extracts, Inc., as filed with the U.S. Securities and Exchange Commission on the date hereof (the “Report”), I, Michael Feinsod, the Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to Sec. 906 of the Sarbanes-Oxley Act of 2002, that:

 

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

(2) The information contained in such Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

/s/ Michael Feinsod  
Michael Feinsod  
Chief Executive Officer  
(Principal Executive Officer and Principal Financial Officer)  
   
Dated: July 14, 2023  

 

 

v3.23.2
Document And Entity Information - shares
 3 Months Ended
Mar. 31, 2023
Jul. 14, 2023
Document Information Line Items    
Entity Registrant Name Bespoke Extracts, Inc.  
Document Type 10-Q  
Current Fiscal Year End Date --12-31  
Entity Common Stock, Shares Outstanding   10,168,220
Amendment Flag false  
Entity Central Index Key 0001409197  
Entity Current Reporting Status Yes  
Entity Filer Category Non-accelerated Filer  
Document Period End Date Mar. 31, 2023  
Document Fiscal Year Focus 2023  
Document Fiscal Period Focus Q1  
Entity Small Business true  
Entity Emerging Growth Company true  
Entity Shell Company false  
Entity Ex Transition Period false  
Document Quarterly Report true  
Document Transition Report false  
Entity File Number 000-52759  
Entity Incorporation, State or Country Code NV  
Entity Tax Identification Number 20-4743354  
Entity Address, Address Line One 12001 E. 33rd Avenue  
Entity Address, Address Line Two Unit O  
Entity Address, City or Town Aurora  
Entity Address, Country CO  
Entity Address, Postal Zip Code 80010  
City Area Code 855  
Local Phone Number 633-3738  
Entity Interactive Data Current Yes  
v3.23.2
Consolidated Balance Sheets - USD ($)
Mar. 31, 2023
Dec. 31, 2022
Current assets    
Cash $ 4,365 $ 24,433
Accounts receivable 46,483
Prepaid stock awards 58,569 80,113
Prepaid expense 26,356 7,186
Inventory, net 13,010
Total current assets 148,783 111,732
Furniture and equipment 48,162 9,947
License 10,000  
Right of Use Asset 259,564 275,912
Deposits 12,000 12,000
Total assets 478,509 409,591
Current liabilities    
Accounts payable and accrued liabilities 492,074 295,818
Inventory earn-out 90,000
Note payable - related party 692,500 415,500
Operating lease liability 64,330 64,330
Total current liabilities 1,248,904 865,648
Long-Term Operating Lease Liability 199,889 216,039
Total liabilities 1,448,793 1,081,687
Commitments and contingencies (Note 10)
Stockholders’ Deficit    
Preferred Stock, $0.001 par value, 50,000,000 shares authorized, 1 share designated; 1 share issued and outstanding as of March 31, 2023 and December 31, 2022, respectively, stated value $24,000
Common stock, $0.001 par value: 3,000,000,000 authorized; 10,168,220 and 9,945,977 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively 10,166 9,944
Common stock to issue 6,478 shares
Additional paid-in capital 23,343,968 23,201,758
Accumulated deficit (24,324,418) (23,883,798)
Total stockholders’ deficit (970,284) (672,096)
Total liabilities and stockholders’ deficit $ 478,509 $ 409,591
v3.23.2
Consolidated Balance Sheets (Parentheticals) - $ / shares
Mar. 31, 2023
Dec. 31, 2022
Statement of Financial Position [Abstract]    
Preferred stock, par value (in Dollars per share) $ 0.001 $ 0.001
Preferred stock, designated share 1 1
Preferred stock, share issued 1 1
Preferred stock, share outstanding 1 1
Preferred stock, share stated value 24,000 24,000
Preferred Stock, shares authorized 50,000,000 50,000,000
Common stock, par value (in Dollars per share) $ 0.001 $ 0.001
Common stock, shares authorized 3,000,000,000 3,000,000,000
Common stock, shares issued 10,168,220 9,945,977
Common stock, shares outstanding 10,168,220 9,945,977
Common stock, shares issued 6,478 6,478
v3.23.2
Consolidated Statements of Operations (Unaudited) - USD ($)
 3 Months Ended
Mar. 31, 2023
Mar. 31, 2022
Income Statement [Abstract]    
Sales $ 89,016 $ 3,061
Cost of products sold 78,667 847
Gross Profit 10,349 2,214
Operating expenses:    
Selling, general and administrative expenses 374,515 897,534
Professional fees 61,204 54,355
Consulting 18,000 23,000
Total operating expenses 453,719 974,889
Loss from operations (443,370) (972,675)
Other income / (expenses)    
Interest income 2,750 181
Interest expense
Total other (expense) / income 2,750 181
Loss before income tax (440,620) (972,494)
Provision for income tax
Net Loss $ (440,620) $ (972,494)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING    
Basic and Diluted (in Shares) 10,107,108 6,992,070
NET LOSS PER COMMON SHARE OUTSTANDING    
Basic and Diluted (in Dollars per share) $ (0.04) $ (0.14)
v3.23.2
Consolidated Statements of Operations (Unaudited) (Parentheticals) - $ / shares
 3 Months Ended
Mar. 31, 2023
Mar. 31, 2022
Income Statement [Abstract]    
Diluted (in Shares) 10,107,108 6,992,070
Diluted (in Dollars per share) $ (0.04) $ (0.14)
v3.23.2
Consolidated Statement of Stockholders Equity / (Deficit) - USD ($)
Series C
Preferred Shares
Common Shares
Additional Paid-in Capital
Common Stock Shares to be Issued
Common Stock to be issued Par Amount
Accumulated Deficit
Total
Balance at Dec. 31, 2021 $ 8,142 $ 21,741,403   $ 7,987 $ (19,767,571) $ 1,989,961
Balance (in Shares) at Dec. 31, 2021 1 8,141,965   6,478      
Payment of capital contribution 4,792   4,792
Stock based compensation and stock option expense 727,606   727,606
Common stock issued for cash $ 877 196,373   197,250
Common stock issued for cash (in Shares)   876,667          
Net loss   (972,494) (972,494)
Balance at Mar. 31, 2022 $ 9,019 22,670,174   7,987 (20,740,065) 1,947,115
Balance (in Shares) at Mar. 31, 2022 1 9,018,632   6,478      
Balance at Dec. 31, 2022 $ 9,944 23,201,758   (23,883,798) (672,096)
Balance (in Shares) at Dec. 31, 2022   9,945,997        
Purchase Wonderleaf $ 222 49,778   50,000
Purchase Wonderleaf (in Shares)   222,223          
Stock based compensation and stock option expense 92,432   92,432
Net loss   (440,620) (440,620)
Balance at Mar. 31, 2023 $ 10,166 $ 23,343,968   $ (24,324,418) $ (970,284)
Balance (in Shares) at Mar. 31, 2023 1 10,168,220        
v3.23.2
Consolidated Statements of Cash Flows (Unaudited) - USD ($)
 3 Months Ended
Mar. 31, 2023
Mar. 31, 2022
Cash flows from operating activities    
Net Loss $ (440,620) $ (972,494)
Adjustments to reconcile net loss to net cash used in operating activities    
Inventory reserve 40,393
Depreciation 1,785  
Amortization of right of use asset, net 16,348
Amortization expense for prepaid expenses for consulting shares 21,544 15,745
Stock based compensation and stock option expense 92,432 727,606
Changes in operating assets and liabilities:    
Accounts receivable (46,483) (64)
Prepaid expenses (19,170) 996
Inventory (53,403) 355
Interest receivable – Wonderleaf (181)
Accounts payable and accrued liabilities 196,256 22,892
Operating lease liability (16,150) (14,648)
Net Cash (used in) operating activities (207,068) (219,793)
Cash flows from investing activities    
Advances to Wonderleaf (6,443)
Note receivable Wonderleaf funded (20,000)
Purchase of equipment (7,202)
Net cash used in investing activities (33,645)
Cash flow from financing activities    
Payment of capital contribution 4,792
Payment of inventory earnout (90,000)
Proceeds from issuance of note payable - related party 277,000
Repayment of note payable - related party (2,500)
Proceeds from issuance of units 197,250
Net cash provided by financing activities 187,000 199,542
Net increase / (decrease) in cash (20,068) (53,896)
Cash at beginning of period 24,433 148,227
Cash at end of period 4,365 94,331
Supplemental disclosure of cash flow information    
Cash paid for interest
Cash paid for income taxes
Noncash investing and financing activities:    
Stock issued to Weonderleaf for fixed assets and license $ 50,000
v3.23.2
Nature of Operations, Significant Accounting Policies and Going Concern
 3 Months Ended
Mar. 31, 2023
Accounting Policies [Abstract]  
NATURE OF OPERATIONS, SIGNIFICANT ACCOUNTING POLICIES AND GOING CONCERN

1. NATURE OF OPERATIONS, SIGNIFICANT ACCOUNTING POLICIES AND GOING CONCERN

 

Nature of Business Operations 

 

Bespoke Extracts, Inc. (the “Company”) is a Nevada corporation focused on operating in the regulated cannabis markets in the United States. Through Bespoke Colorado, we operate a marijuana infused products production facility in Aurora, Colorado.

  

On December 2, 2021, Bespoke Extracts Colorado, LLC (“Bespoke Colorado”), a newly formed wholly-owned subsidiary of the Company entered into an asset purchase agreement with WonderLeaf, LLC (“WonderLeaf”), and on December 7, 2021, Bespoke Colorado and WonderLeaf entered into an amendment to such asset purchase agreement (as amended, the “WonderLeaf Purchase Agreement”).. On January 3, 2023, the Company completed the acquisition of the WonderLeaf assets and the change of control was approved by the Colorado Marijuana Enforcement Division for 222,223 shares of common stock valued at $50,000, or $0.225 per share. At the time of acquisition Wonderleaf had no operations or no employees and was not considered a business. 

 

On February 2, 2022, the Company changed its fiscal year from August 31 to December 31.

 

Certain prior period amounts have been reclassified to conform to the current period presentation which include common stock and additional paid in capital.

 

Principles of Consolidation

 
The accompanying condensed consolidated unaudited financial statements include the accounts of Bespoke Extracts, Inc., and its wholly owned subsidiary Bespoke Extracts Colorado, LLC. All inter-company balances have been eliminated.

 

Going Concern

 

The accompanying condensed consolidated unaudited financial statements have been prepared assuming a continuation of the Company as a going concern. The Company had negative cash flows from operations of $207,068 for the three months ended March 31, 2023, and a working capital deficit of $1,100,121 and accumulated deficit of $24,324,418 as of March 31, 2023. This raises substantial doubt about our ability to continue as a going concern for a period of one year from the date of these financial statements.

 

The Company’s ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or obtaining the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. There is no assurance that this series of events will be satisfactorily completed.

 

Further, if we issue additional equity or debt securities, stockholders may experience additional dilution or the new equity securities may have rights, preferences or privileges senior to those of existing holders of our common stock. If additional financing is not available or is not available on acceptable terms, we will have to curtail or cease our operations. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event the Company cannot continue in existence. These financial statements do not include any adjustments that might arise from this uncertainty.

 

Use of Estimates

 

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the accompanying consolidated financial statements and accompanying notes. Significant estimates include the assumption used in the valuation of equity-based transactions, valuation of intangible assets, allowance for doubtful accounts and inventory valuation and reserves. Actual results could differ from those estimates. 

 

Cash and Cash Equivalents

 

Cash and cash equivalents include all highly liquid investments with original maturities of three months or less at the time of purchase. At March 31, 2023 and December 31, 2022, the Company did not have any cash equivalents. The Company did not have any cash in excess of FDIC limits of $250,000 at any single bank.

 

Fair Value of Financial Instruments

 

The carrying amounts of cash, accounts receivable, inventory, fixed assets, licenses, and other assets, accounts payable, accrued liabilities, note payable and convertible note payable approximate their fair values as of March 31, 2023 and December 31, 2022, respectively, because of their short-term natures and the Company’s borrowing rate of interest.

 

Accounts Receivable

 

Accounts receivable are recorded at fair value on the date revenue is recognized. The Company provides allowances for doubtful accounts for estimated losses resulting from the inability of its customers to repay their obligation. If the financial condition of the Company’s customers were to deteriorate, resulting in an impairment of their ability to repay, additional allowances may be required. The Company provides for potential uncollectible accounts receivable based on specific customer identification and historical collection experience adjusted for existing market conditions. If market conditions decline, actual collection experience may not meet expectations and may result in decreased cash flows and increased bad debt expense.

 

The policy for determining past due status is based on the contractual payment terms of each customer, which are generally net 30 or net 60 days. Once collection efforts by the Company and its collection agency are exhausted, the determination for charging off uncollectible receivables is made. At March 31, 2023 and December 31, 2022, the Company has recorded an allowance for doubtful accounts of $0 and $0, respectively.

 

Inventory, Net

 

Inventories are stated at the lower of cost or net realizable value. Cost is determined by the first-in, first-out basis and net realizable value. Net realizable value is defined as sales price less cost of completion, disposition and transportation and a normal profit margin. As of March 31, 2023 and December 31, 2022, inventory amounted to $13,010 and $0 net of reserves, respectively, which consisted of finished goods of $13,010 and $0, and raw materials of $0 and $0, respectively.

 

Property and equipment

 

Property and equipment is recorded at cost and capitalized from the initial date of service. Expenditures for major additions and improvements are capitalized and minor replacements, maintenance, and repairs are charged to expense as incurred. When property and equipment is retired or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is included in the results of operations for the respective period. Depreciation is provided over the estimated useful lives of the related assets using the straight-line method for financial statement purposes. The Company uses other depreciation methods (generally accelerated) for tax purposes where appropriate. The estimated useful lives for significant property and equipment categories are as follows:

 

Schedule of Estimated useful Lives of Property and Equipment

 

Furniture and Equipment   5 years 

 

License

 

License represents the Colorado license distributing cannabis. The license will be amortized over its useful life.

 

Revenue Recognition

 

We account for revenue in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification Topic 606, “Revenue from Contracts with Customers”. Revenue is measured based on the amount of consideration that we expect to receive, reduced by discounts and estimates for credits and returns (calculated based upon previous experience and management’s evaluation). Outbound shipping charged to customers is recognized at the time the related merchandise revenues are recognized and are included in net revenues. Inbound and outbound shipping and delivery costs are included in cost of revenues.

 

Our products are sold directly to licensed marijuana dispensaries in Colorado. Revenue is recognized when control of the merchandise is transferred to the customer, which generally occurs upon shipment. Payment is typically due on the date of shipment [or within 15 days].

 

At March 31, 2023, two customers amounted to 27.5% and 31.4% amounted, or 58.9% of accounts receivable. During the year ended December 31, 2022 no customer amounted to over 10% of the total accounts receivable. During the three months ended March 31, 2023 three customers amounted to 14.4%, 15.1% and 16.4%, or 45.9% of sales for the period. During the three months ended March 31, 2022 no individual customer amounted to over 10% of tota1 sales.

 

Stock Based Compensation

 

Stock options and warrants issued to consultants and other non-employees as compensation for services provided to the Company are accounted for based on the fair value of the services provided or the estimated fair market value of the option or warrant, whichever is more reliably measurable, and in accordance with FASB ASC 718, Compensation-Stock Compensation, including related amendments and interpretations.

 

Reclassification

 

Prior gross prepaid stock compensation and additional paid in capital presented in the 10Q for the period end March 31, 2022 have been reclassified to conform with the financials filed in the December 31, 2022 10K.

 

Net Income / (Loss) per Share

 

Basic income / (loss) per share amounts are computed based on net income / (loss) divided by the weighted average number of common shares outstanding. Diluted earnings per share reflect the potential dilution that could occur if potentially dilutive securities were exercised or converted to common stock. The dilutive effect of options and warrants and their equivalent is computed by application of the treasury stock method and the effect of convertible securities by the “if converted” method. The effect of 219,556 warrants and 1,023,842 options is anti-dilutive for the three months ended March 31, 2023 as they are not in the money. The effect of 562.967 warrants and 1,022,842 options is anti-dilutive for the three months ended March 31, 2022 as they are not in the money. 

 

Reverse Stock Split

 

On December 5, 2022 the Company approved an amendment to its articles of incorporation to effect a 45-to-1 reverse split of our common stock effective January 13, 2023. All prior equity amounts have been presented to reflect this split.

 

Recent accounting pronouncements

 

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) or other standard setting bodies that are adopted by the Company as of the specified effective date.

 

Income Taxes

 

We utilize the asset and liability method of accounting for income taxes. We recognize deferred tax liabilities or assets for the expected future tax consequences of temporary differences between the book and tax basis of assets and liabilities. We regularly assess the likelihood that our deferred tax assets will be recovered from future taxable income. We consider projected future taxable income and ongoing tax planning strategies in assessing the amount of the valuation allowance necessary to offset our deferred tax assets that will not be recoverable. We have recorded and continue to carry a full valuation allowance against our gross deferred tax assets that will not reverse against deferred tax liabilities within the scheduled reversal period. If we determine in the future that it is more likely than not that we will realize all or a portion of our deferred tax assets, we will adjust our valuation allowance in the period we make the determination. We expect to provide a full valuation allowance on our future tax benefits until we can sustain a level of profitability that demonstrates our ability to realize these assets.
v3.23.2
Asset Purchase Agreement
 3 Months Ended
Mar. 31, 2023
Asset Purchase Agreement [Abstract]  
ASSET PURCHASE AGREEMENT

2. ASSET PURCHASE AGREEMENT

 

On January 3, 2023, the Company completed the acquisition of the WonderLeaf assets for 222,223 shares of common stock valued at $50,000, or $0.225 per share. At the time of acquisition Wonderleaf had no operations or no employees and was not considered a business. 

 

Pursuant to ASU 2017-01 and ASC 805, the Company analyzed the business of Wonderleaf to determine if the Company acquired a business or acquired assets. Based on this analysis, the Company determined that it acquired assets. No goodwill was recorded since the purchase was accounted for as an asset purchase. In accordance with ASC 805, the fair value of the assets acquired is based on either the fair value of the consideration given or the fair value of the assets acquired, whichever is more clearly evident, and thus, more reliably measurable. The Company used the market price of the 222,223 common shares issued of $50,000 as the fair value of the assets acquired since this value was more clearly evident, and thus, more reliably measurable than the fair value of the license and fixed assets acquired.

 

Company management determined if the Company acquired a business or acquired assets. The FASB issued new guidance (ASU 2017-01) that changed the definition of a business to assist entities with evaluating when a set of transferred assets and activities is a business. The guidance requires an entity to evaluate if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets; if so, the set of transferred assets and activities is not a business. The guidance also requires a business to include at least one substantive process and narrows the definition of outputs by more closely aligning it with how outputs are described in ASC 606. Under the new guidance, an entity first determines whether substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets. If this threshold is met, the set is not a business. If it’s not met, the entity then evaluates whether the set meets the requirement that a business include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create outputs. Under the ASU, a set is not a business when substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets.

 

Pursuant to 805-10-55-83, the Company first considered the guidance in paragraphs 805-10-55-5A through 55-5C. The identifiable assets that could be recognized in the purchase only included the license and fixed assets. Accordingly, the transaction was not considered a business.

 

The monetary value of the 222,223 shares is deemed by the Company to be $50,000 in accordance with Accounting Standards Codification (“ASC”) 805-50-30 “Business Combinations”, the Company determined that if the consideration paid is not in the form of cash, the measurement may be based on either (i) the cost which is measured based on the fair value of the consideration given or (ii) the fair value of the assets (or net assets) acquired, whichever is more clearly evident and thus more reliably measurable. No goodwill should be recorded since the WPA was accounting for as an asset purchase. The Company determined that the fair value of the common shares issued was a better indicator which is more reliably measurable.

 

The Company assigned a value of $10,000 to the licenses and $40,000 to the fixed assets acquired.
v3.23.2
Inventory Earn-Out
 3 Months Ended
Mar. 31, 2023
Inventory Disclosure [Abstract]  
INVENTORY EARN-OUT

3. INVENTORY EARN-OUT 

 

As described in Note 9, in exchange for cancellation of the debt owed under the Debenture, the Company transferred to the holder certain domain names and agreed to pay the holder, beginning December 1, 2021, and on a monthly basis through August 31, 2022, 40% of the operating profit generated from sale of the existing CBD inventory of the Company, and on August 31, 2022, to make a final payment equal to an amount of $75,000 minus the total of the monthly payments made under the Inventory Earn Out. As of December 31, 2022 no amounts had been paid. The inventory earn-out agreement was amended on November 11, 2022 such that the final payment under the inventory earn out was increased to $90,000 (less any payments previously made) and was due February 28, 2023. During the three months ended March 31, 2023 the amount was paid.
v3.23.2
Note Receivable
 3 Months Ended
Mar. 31, 2023
Receivables [Abstract]  
NOTE RECEIVABLE

4. NOTE RECEIVABLE 

 

On January 19, 2022 the Company loaned WonderLeaf $10,000, pursuant to a promissory note. The note bears interest at 5% annually and matures on January 18, 2023.

 

On February 8, 2022 the Company loaned WonderLeaf $10,000, pursuant to a promissory note. The note bears interest at 5% annually and matures on February 8, 2023.

 

On October 25, 2022 the Company loaned WonderLeaf $25,000, pursuant to a promissory note. The note bears interest at 5% annually and matures on February 8, 2023.

 

As of December 31, 2022 accrued interest on the notes receivable amounted to $931.

 

At December 31, 2022 the Company recorded a reserve of $45,931 for the promissory notes and accrued interest.
v3.23.2
Furniture and Equipment
 3 Months Ended
Mar. 31, 2023
Property, Plant and Equipment [Abstract]  
Furniture and equipment

Note 5 – Furniture and equipment.

 

Machinery and equipment consisted of the following at:

 

Schedule of Machinery and Equipment

 

   March 31,
2023		   December 31,
2022		 
Furniture and equipment  $2,745   $2,745 
Machinery and Equipment  $47,202   $7,202 
Fixed assets, total  $49,947   $9,947 
Total: accumulated depreciation  $(1,785)  $
-
 
Fixed assets, net  $48,162   $9,947 

 

Depreciation expense for the three months ended March 31, 2023 and March 31, 2022 were $1,785 and $0 respectively.
v3.23.2
Note Payable – Related Party
 3 Months Ended
Mar. 31, 2023
Note Payable - Related Party [Abstract]  
NOTE PAYABLE – RELATED PARTY

6. NOTE PAYABLE – RELATED PARTY

 

During the three months ended March 31, 2023, Michael Feinsod, the Company’s chief executive officer, loaned the Company an additional $227,000. As of March 31, 2023 and December 31, 2022 the amount owed Michael Feinsod is $692,500 and $415,500, respectively. All loans are payable upon demand.
v3.23.2
Leases
 3 Months Ended
Mar. 31, 2023
Leases [Abstract]  
LEASES

7. LEASES

 

In connection with the WonderLeaf Purchase Agreement, Bespoke Colorado entered into a lease agreement (the “Lease”) with WL Holdings, Ltd. (“WL Holdings”) in December 2021. Pursuant to the Lease, Bespoke Colorado will lease from WL Holdings certain commercial space in Aurora, Colorado, where WonderLeaf’s business has been located, commencing upon signing of the Lease and Wonderleaf Purchase Agreement, for a term of five years, which Bespoke Colorado will have an option to renew for an additional five years. Monthly rent under the Lease will start at $6,000. The Lease grants the Company an option to purchase the property for $600,000. The Company has not decided whether it will exercise either option.

 

Supplemental balance sheet information related to leases was as follows:

 

Lease term and discount rate were as follows:

 

   March  31, 
   2023 
Weighted average remaining lease term (years)   3.69 
Weighted average discount rate   4%

 

The component of lease costs was as follows:

 

   Three Months ended
March  31,		 
   2023 
Operating lease cost  $19,093 
Variable lease cost (1)   1,050 
Total lease costs  $20,143 

 

(1) Variable lease cost primarily relates to common area maintenance, property taxes and insurance on leased real estate.

 

Supplemental disclosures of cash flow information related to leases were as follows:

 

   March 31, 
   2023 
Cash paid for operating lease liabilities  $
    -
 

 

Maturities of lease liabilities were as follows as of March 31, 2023:

 

    Operating  
    Leases  
2023   $ 56,700  
2024     75,915  
2025     79,380  
2026     72,765  
Thereafter     -  
Total undiscounted lease payments     284,760  
Less: Present value discount     (23,291 )
Total Present value of lease liabilities   $ 264,219  

 

Operating Leases   Classification   March 31,
2023		  
Right-of-use assets   Right of use assets   $ 259,564  
             
Current lease liabilities   Current operating lease liabilities     64,330  
Non-current lease liabilities   Long-term operating lease liabilities     199,889  
Total lease liabilities       $ 264,219  
v3.23.2
Equity
 3 Months Ended
Mar. 31, 2023
Stockholders' Equity Note [Abstract]  
EQUITY

8. EQUITY

 

Common Stock and Preferred Stock

 

On December 5, 2022 the Company approved an amendment to its articles of incorporation to effect a 45-to-1 reverse split of our common stock effective January 13, 2023. All prior amounts equity amounts have been presented to reflect this reverse split.

 

As of March 31, 2023 and December 31, 2022, the Company’s authorized capital stock consists of 3,000,000,000 shares of common stock, par value $0.001, and 50,000,000 shares of preferred stock, par value $0.001. 1,000 shares of preferred stock are designated as Series A Convertible Preferred Stock. No shares of Series A Preferred Stock are issued and outstanding as of March 31, 2023 and December 31, 2022, respectively. The Company’s Certificate of Designation of Series B Preferred Stock was withdrawn by the Company on June 30, 2020. 1 share of preferred stock is designated Series C Preferred Stock and is issued and outstanding as of March 31, 2023 and December 31, 2022, respectively. The Series C Preferred Stock has a stated value of $24,000 and entitles the holder to 51% of the total voting power of the Company’s stockholders. The Company may, in its sole discretion, redeem the Series C Preferred Stock at any time for a redemption price equal to the stated value. Upon payment of the redemption price by the Company, the Series C Preferred Stock will revert to the status of authorized but unissued preferred stock. 

 

On January 3, 2023, the Company completed the acquisition of the WonderLeaf assets for 222,223 shares of common stock valued at $50,000, or $0.225 per share.

 

On December 14, 2021, the board of directors of the Company adopted the Company’s 2021 Equity Incentive Plan (the “2021 Plan”), pursuant to which up to an aggregate of 6,666,667 shares of common stock are available for issuance. Awards under the plan may include options (including incentive stock options and non-qualified stock options), stock appreciation rights, restricted stock, restricted stock units, performance share awards, or other equity-based awards, each as defined under the 2021 Plan. Options awarded under the 2021 Plan are to have an exercise price of not less than 100% of the fair market value of the common stock on the grant date and a term of not more than ten years from the option grant date.

 

On December 14, 2021, the Company entered into an employment agreement with Hunter Garth. Pursuant to the employment agreement, Mr. Garth will serve as the Company’s president and will receive a base monthly salary of $8,000. The Company also granted to Mr. Garth, pursuant to the Company’s 2021 Equity Incentive Plan, 500,000 shares of restricted common stock valued at $675,000 ($1.35 per share), which vested one year from the date of grant. During the year ended December 31, 2022 the Company recorded $675,000 a prepaid expenses associated with the stock based compensation. During the years ended December 31, 2022 and 2021 the amount was amortized $643,562 and $31,438, respectively.

   

On December 14, 2021, the Company entered into an employment agreement with Michael Feinsod, the Company’s chief executive officer and chairman. Pursuant to the employment agreement, Mr. Feinsod will continue to serve as the Company’s chief executive officer and chairman and will receive a base monthly salary of $10,000. The Company also granted to Mr. Feinsod, pursuant to the Company’s 2021 Equity Incentive Plan, 1,000,000 shares of restricted common stock valued at $1,350,000 ($1.35 per share), which vested one year from the date of grant. During the year ended December 31, 2022 the Company recorded $1,350,000 of prepaid expenses associated with the stock based compensation. During the years ended December 31, 2022 and 2021 the amount was amortized $1,287,123 and $62,877, respectively. As of December 31. 2022 and 2021 the Company recorded a prepaid stock award of $0 and $1,287,123, respectively.

 

During the year ended December 31, 2022, the Company entered into and closed securities purchase agreements with investors pursuant to which the Company issued and sold to the investors an aggregate of 1,530,897 shares of common stock and warrants to purchase an aggregate of 1,530,897 shares of common stock, for an aggregate purchase price of $344,450. The warrants expired June 30, 2023 and had an exercise price of $2.25.

 

Effective August 1, 2022, the Company issued an aggregate of 266,667 shares of common stock to employees and consultants for services, including 155,556 shares that vest immediately, 55,556 shares that vested one year from the grant date, and 55,556 shares that will vest two years from the grant date. During the year ended December 31, 2022 the Company recorded an expense $1,104,928. For the three months ended March 31, 2023 the Company recorded an expense of $21,544. As of March 31, 2023 and December 31, 2022 the Company had a prepaid stock award of $58,569 and $80,113.

 

Warrants

 

During the four months ended December 31, 2021, the Company entered into and closed securities purchase agreements with investors pursuant to which the Company issued and sold to the investors an aggregate of 50,000,000 shares of common stock and warrants to purchase an aggregate of 12,500,000 shares of common stock, for an aggregate purchase price of $250,000 with offering costs of $10,000 for legal expenses. The warrants had a term of one year and an exercise price of $2.25.

 

During the year ended December 31, 2022, the Company entered into and closed securities purchase agreements with investors pursuant to which the Company issued and sold to the investors an aggregate of 1,530,887 shares of common stock and warrants to purchase an aggregate of 382,722 shares of common stock, for an aggregate purchase price of $344,450. The warrants expired June 30, 2023 and had an exercise price of $2.25.

 

The following table summarizes the warrant activities during the three months ended March 31, 2023:

 

   Number of
Warrants		   Weighted-
Average
Exercise
Price Per
Share		   Weighted-
Average
Remaining
Life		 
Outstanding at August 31, 2022   438,723    5.03    0.36 
Granted   
-
    
-
    
-
 
Canceled or expired   (219,167)   2.45    
-
 
Outstanding at March 31, 2023   219,556   $7.81    0.33 years 
Exercisable at March 31, 2023   219,556   $7.81    0.33 years 
Intrinsic value at March 31, 2023       $
-
      

  

Options

 

On December 14, 2021, the Company entered into an employment agreement with Hunter Garth, wherein the Company granted to Mr. Garth, pursuant to the Company’s 2021 Equity Incentive Plan, ten-year options to purchase 333,333 shares of common stock at an exercise price of $2.70 (representing a 120% premium over the closing price of the common stock on December 13, 2021). One-third of the options will vest on each yearly anniversary of the date of grant. The options were valued at $450,000 using a Black-Scholes pricing model. During the three months ending March 31, 2023 and 2022 the Company recorded $30,811 and $97,797 respectively of expenses associated with the vesting of these stock options. (See notes 9 and 10).

 

On December 14, 2021, the Company entered into an employment agreement with Michael Feinsod, wherein the Company granted to Mr. Feinsod, pursuant to the Company’s 2021 Equity Incentive Plan, ten-year options to purchase 666,667 shares of common stock at an exercise price of $2.70 (representing a 120% premium over the closing price of the common stock on December 13, 2021). One-third of the options will vest on each yearly anniversary of the date of grant. The options were valued at $900,000 using a Black-Scholes pricing model. During the three months ended March 31, 2023 and 2022 the Company recorded $61,621 and $135,594, respectively of expenses associated with the vesting of these stock options. (See notes 9 and 10).

 

On December 14, 2021, the Company issued to a consultant options to purchase 22,222 shares of common stock at an exercise price of $1.35. The options vest over a period of 3 months and have a term of 10 years. The options were valued at $30,000 using a Black-Scholes pricing model. During the three months ended March 31, 2023 and 2022 the Company recorded $0 and $24,900, respectively of expenses associated with the vesting of these stock options.

 

The following table summarizes the option activities during the four months ended December 31, 2021 and the year ended December 31, 2022:

 

   Number of
Options		   Weighted-
Average Exercise
Price Per
Share		   Weighted-
Average
Remaining
Life		 
Outstanding at December 31, 2022   1,023,842    2.67    8.95 years 
Granted   
-
    
-
    
 
 
Canceled or expired   
-
    
-
      
Exercised   
-
    
-
      
Outstanding at March 31, 2023   1,023,842   $2.67    8.71 years 
Exercisable at March  31, 2023   357,174   $2.67    8.69 years 
Intrinsic value at March 31, 2023       $
-
      

 

The future expense as of March 31, 2023 is $420,381.
v3.23.2
Related Party Transactions
 3 Months Ended
Mar. 31, 2023
Related Party Transactions [Abstract]  
RELATED PARTY TRANSACTIONS

9. RELATED PARTY TRANSACTIONS

  

On December 14, 2021, the Company entered into an employment agreement with Hunter Garth. Pursuant to the employment agreement, Mr. Garth will serve as the Company’s president and will receive a base monthly salary of $8,000. The Company also granted to Mr. Garth, pursuant to the Company’s 2021 Equity Incentive Plan, 500,000 shares of restricted common stock, which vested one year from the date of grant, and ten-year options to purchase 333,333 shares of common stock at an exercise price of $2.70 (representing a 120% premium over the closing price of the common stock on December 13, 2021). One-third of the options will vest on each yearly anniversary of the date of grant. In the event that Mr. Garth is terminated without cause or resigns with good reason (each as defined in the employment agreement), he will be entitled to his monthly base salary for twelve months following such termination.

  

On December 14, 2021, the Company entered into an employment agreement with Michael Feinsod, the Company’s chief executive officer and chairman. Pursuant to the employment agreement, Mr. Feinsod will continue to serve as the Company’s chief executive officer and chairman and will receive a base monthly salary of $10,000. The Company also granted to Mr. Feinsod, pursuant to the Company’s 2021 Equity Incentive Plan, 1,000,000 shares of restricted common stock, which vested one year from the date of grant, and ten-year options to purchase 666,667 shares of common stock at an exercise price of $2.70 (representing a 120% premium over the closing price of the common stock on December 13, 2021). One-third of the options will vest on each yearly anniversary of the date of grant. In the event that Mr. Feinsod is terminated without cause or resigns with good reason (each as defined in the employment agreement), he will be entitled to his monthly base salary for twelve months following such termination.

 

During the year ended December 31, 2022, Michael Feinsod, the Company’s chief executive officer, advanced the Company $415,500 and was repaid $2,500 for operations. During the three months ended March 31, 2023 Michael Feinsod advanced an additional $277,000. The loans are non-interest bearing and payable upon demand. (See Note 6.)

 

As of March 31, 2023 Michael Feinsod is owed a total of $105,000 of accrued salary and accounts payable of $78,936.
v3.23.2
Commitments and Contingencies
 3 Months Ended
Mar. 31, 2023
Commitments and Contingencies Disclosure [Abstract]  
COMMITMENTS AND CONTINGENCIES

10. COMMITMENTS AND CONTINGENCIES

 

In connection with a stock purchase agreement, on October 28, 2021, a convertible debenture with an original issue date of December 24, 2019, as amended by Amendment No. 1 thereto, dated May 28, 2020, Amendment No. 2 thereto, dated August 21, 2020, Amendment No. 3 thereto, dated December 10, 2020, Amendment No. 4 thereto, dated January 15, 2021, Amendment No. 5 thereto, dated April 2, 2021, and Amendment No. 6 thereto, dated August 2, 2021 (as amended, the “Debenture”) with an original principal amount of approximately $400,000 was terminated, and all amounts due and payable thereunder forgiven pursuant to a cancellation and satisfaction of debenture agreement entered into between the Company and the Debenture holder (the “Debt Cancellation Agreement”). In exchange for cancellation of the debt owed under the Debenture, the Company transferred to the holder certain domain names and agreed to pay the holder, beginning December 1, 2021, and on a monthly basis through August 31, 2022, 40% of the operating profit generated from sale of the existing CBD inventory of the Company (the “Inventory Earn Out”), and on August 31, 2022, to make a final payment equal to an amount of $75,000 minus the total of the monthly payments made under the Inventory Earn Out. The inventory earn-out agreement was amended on November 11, 2022 (see Note 3) such that the final payment under the inventory earn out was increased to $90,000 (less any payments previously made) and was due February 28, 2023. During the three months ended March 31, 2023 the amount was paid.

 

On December 14, 2021, the Company entered into an employment agreement with Hunter Garth. Pursuant to the employment agreement, Mr. Garth will serve as the Company’s president and will receive a base monthly salary of $8,000. The Company also granted to Mr. Garth, pursuant to the Company’s 2021 Equity Incentive Plan, 500,000 shares of restricted common stock, which vested one year from the date of grant, and ten-year options to purchase 333,333 shares of common stock at an exercise price of $2.70 (representing a 120% premium over the closing price of the common stock on December 13, 2021). One-third of the options will vest on each yearly anniversary of the date of grant. In the event that Mr. Garth is terminated without cause or resigns with good reason (each as defined in the employment agreement), he will be entitled to his monthly base salary for twelve months following such termination.

  

On December 14, 2021, the Company entered into an employment agreement with Michael Feinsod, the Company’s chief executive officer and chairman. Pursuant to the employment agreement, Mr. Feinsod will continue to serve as the Company’s chief executive officer and chairman and will receive a base monthly salary of $10,000. The Company also granted to Mr. Feinsod, pursuant to the Company’s 2021 Equity Incentive Plan, 1,000,000 shares of restricted common stock, which vested one year from the date of grant, and ten-year options to purchase 666,667 shares of common stock at an exercise price of $0.06 (representing a 120% premium over the closing price of the common stock on December 13, 2021). One-third of the options will vest on each yearly anniversary of the date of grant. In the event that Mr. Feinsod is terminated without cause or resigns with good reason (each as defined in the employment agreement), he will be entitled to his monthly base salary for twelve months following such termination.

 

On August 11, 2022, the Company and Bespoke Colorado entered into an asset purchase agreement with Osiris, LLC doing business as Best Day Ever (“BDE”) and Michael Gurtman. Pursuant to the purchase agreement, Bespoke Colorado agreed to purchase from BDE, and BDE agreed to sell to Bespoke Colorado, the assets of BDE, including certain licenses. The Company also agreed to assume certain leases, all as further set forth in the purchase agreement. As consideration for the acquisition of the assets, the Company agreed to issue 2,777,778 shares of common stock at the closing of the transaction. Closing of the purchase agreement was subject to receipt of certain governmental approvals and other customary closing conditions. The purchase agreement was terminated on November 18, 2022.
v3.23.2
Subsequent Events
 3 Months Ended
Mar. 31, 2023
Subsequent Events [Abstract]  
SUBSEQUENT EVENTS

11. SUBSEQUENT EVENTS

 

Subsequent to March 31, 2023 , the Company’s chief executive officer, loaned the Company an additional $157,000.
v3.23.2
Accounting Policies, by Policy (Policies)
 3 Months Ended
Mar. 31, 2023
Accounting Policies [Abstract]  
Nature of Business Operations

Nature of Business Operations 

Bespoke Extracts, Inc. (the “Company”) is a Nevada corporation focused on operating in the regulated cannabis markets in the United States. Through Bespoke Colorado, we operate a marijuana infused products production facility in Aurora, Colorado.

On December 2, 2021, Bespoke Extracts Colorado, LLC (“Bespoke Colorado”), a newly formed wholly-owned subsidiary of the Company entered into an asset purchase agreement with WonderLeaf, LLC (“WonderLeaf”), and on December 7, 2021, Bespoke Colorado and WonderLeaf entered into an amendment to such asset purchase agreement (as amended, the “WonderLeaf Purchase Agreement”).. On January 3, 2023, the Company completed the acquisition of the WonderLeaf assets and the change of control was approved by the Colorado Marijuana Enforcement Division for 222,223 shares of common stock valued at $50,000, or $0.225 per share. At the time of acquisition Wonderleaf had no operations or no employees and was not considered a business. 

On February 2, 2022, the Company changed its fiscal year from August 31 to December 31.

Certain prior period amounts have been reclassified to conform to the current period presentation which include common stock and additional paid in capital.
Principles of Consolidation

Principles of Consolidation

 
The accompanying condensed consolidated unaudited financial statements include the accounts of Bespoke Extracts, Inc., and its wholly owned subsidiary Bespoke Extracts Colorado, LLC. All inter-company balances have been eliminated.
Going Concern

Going Concern

The accompanying condensed consolidated unaudited financial statements have been prepared assuming a continuation of the Company as a going concern. The Company had negative cash flows from operations of $207,068 for the three months ended March 31, 2023, and a working capital deficit of $1,100,121 and accumulated deficit of $24,324,418 as of March 31, 2023. This raises substantial doubt about our ability to continue as a going concern for a period of one year from the date of these financial statements.

The Company’s ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or obtaining the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. There is no assurance that this series of events will be satisfactorily completed.

Further, if we issue additional equity or debt securities, stockholders may experience additional dilution or the new equity securities may have rights, preferences or privileges senior to those of existing holders of our common stock. If additional financing is not available or is not available on acceptable terms, we will have to curtail or cease our operations. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event the Company cannot continue in existence. These financial statements do not include any adjustments that might arise from this uncertainty.

 
Use of Estimates

Use of Estimates

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the accompanying consolidated financial statements and accompanying notes. Significant estimates include the assumption used in the valuation of equity-based transactions, valuation of intangible assets, allowance for doubtful accounts and inventory valuation and reserves. Actual results could differ from those estimates. 
Cash and Cash Equivalents

Cash and Cash Equivalents

Cash and cash equivalents include all highly liquid investments with original maturities of three months or less at the time of purchase. At March 31, 2023 and December 31, 2022, the Company did not have any cash equivalents. The Company did not have any cash in excess of FDIC limits of $250,000 at any single bank.
Fair Value of Financial Instruments

Fair Value of Financial Instruments

The carrying amounts of cash, accounts receivable, inventory, fixed assets, licenses, and other assets, accounts payable, accrued liabilities, note payable and convertible note payable approximate their fair values as of March 31, 2023 and December 31, 2022, respectively, because of their short-term natures and the Company’s borrowing rate of interest.
Accounts Receivable, Net

Accounts Receivable

Accounts receivable are recorded at fair value on the date revenue is recognized. The Company provides allowances for doubtful accounts for estimated losses resulting from the inability of its customers to repay their obligation. If the financial condition of the Company’s customers were to deteriorate, resulting in an impairment of their ability to repay, additional allowances may be required. The Company provides for potential uncollectible accounts receivable based on specific customer identification and historical collection experience adjusted for existing market conditions. If market conditions decline, actual collection experience may not meet expectations and may result in decreased cash flows and increased bad debt expense.

The policy for determining past due status is based on the contractual payment terms of each customer, which are generally net 30 or net 60 days. Once collection efforts by the Company and its collection agency are exhausted, the determination for charging off uncollectible receivables is made. At March 31, 2023 and December 31, 2022, the Company has recorded an allowance for doubtful accounts of $0 and $0, respectively.
Inventory, Net

Inventory, Net

Inventories are stated at the lower of cost or net realizable value. Cost is determined by the first-in, first-out basis and net realizable value. Net realizable value is defined as sales price less cost of completion, disposition and transportation and a normal profit margin. As of March 31, 2023 and December 31, 2022, inventory amounted to $13,010 and $0 net of reserves, respectively, which consisted of finished goods of $13,010 and $0, and raw materials of $0 and $0, respectively.
Property and equipment

Property and equipment

Property and equipment is recorded at cost and capitalized from the initial date of service. Expenditures for major additions and improvements are capitalized and minor replacements, maintenance, and repairs are charged to expense as incurred. When property and equipment is retired or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is included in the results of operations for the respective period. Depreciation is provided over the estimated useful lives of the related assets using the straight-line method for financial statement purposes. The Company uses other depreciation methods (generally accelerated) for tax purposes where appropriate. The estimated useful lives for significant property and equipment categories are as follows:

Schedule of Estimated useful Lives of Property and Equipment

Furniture and Equipment   5 years 
License

License

License represents the Colorado license distributing cannabis. The license will be amortized over its useful life.

 
Revenue Recognition

Revenue Recognition

We account for revenue in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification Topic 606, “Revenue from Contracts with Customers”. Revenue is measured based on the amount of consideration that we expect to receive, reduced by discounts and estimates for credits and returns (calculated based upon previous experience and management’s evaluation). Outbound shipping charged to customers is recognized at the time the related merchandise revenues are recognized and are included in net revenues. Inbound and outbound shipping and delivery costs are included in cost of revenues.

Our products are sold directly to licensed marijuana dispensaries in Colorado. Revenue is recognized when control of the merchandise is transferred to the customer, which generally occurs upon shipment. Payment is typically due on the date of shipment [or within 15 days].

At March 31, 2023, two customers amounted to 27.5% and 31.4% amounted, or 58.9% of accounts receivable. During the year ended December 31, 2022 no customer amounted to over 10% of the total accounts receivable. During the three months ended March 31, 2023 three customers amounted to 14.4%, 15.1% and 16.4%, or 45.9% of sales for the period. During the three months ended March 31, 2022 no individual customer amounted to over 10% of tota1 sales.
Stock Based Compensation

Stock Based Compensation

Stock options and warrants issued to consultants and other non-employees as compensation for services provided to the Company are accounted for based on the fair value of the services provided or the estimated fair market value of the option or warrant, whichever is more reliably measurable, and in accordance with FASB ASC 718, Compensation-Stock Compensation, including related amendments and interpretations.
Reclassification

Reclassification

Prior gross prepaid stock compensation and additional paid in capital presented in the 10Q for the period end March 31, 2022 have been reclassified to conform with the financials filed in the December 31, 2022 10K.
Net Income / (Loss) per Share

Net Income / (Loss) per Share

Basic income / (loss) per share amounts are computed based on net income / (loss) divided by the weighted average number of common shares outstanding. Diluted earnings per share reflect the potential dilution that could occur if potentially dilutive securities were exercised or converted to common stock. The dilutive effect of options and warrants and their equivalent is computed by application of the treasury stock method and the effect of convertible securities by the “if converted” method. The effect of 219,556 warrants and 1,023,842 options is anti-dilutive for the three months ended March 31, 2023 as they are not in the money. The effect of 562.967 warrants and 1,022,842 options is anti-dilutive for the three months ended March 31, 2022 as they are not in the money. 
Reverse Stock Split

Reverse Stock Split

On December 5, 2022 the Company approved an amendment to its articles of incorporation to effect a 45-to-1 reverse split of our common stock effective January 13, 2023. All prior equity amounts have been presented to reflect this split.
Recent accounting pronouncements

Recent accounting pronouncements

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) or other standard setting bodies that are adopted by the Company as of the specified effective date.

 
Income Taxes

Income Taxes

We utilize the asset and liability method of accounting for income taxes. We recognize deferred tax liabilities or assets for the expected future tax consequences of temporary differences between the book and tax basis of assets and liabilities. We regularly assess the likelihood that our deferred tax assets will be recovered from future taxable income. We consider projected future taxable income and ongoing tax planning strategies in assessing the amount of the valuation allowance necessary to offset our deferred tax assets that will not be recoverable. We have recorded and continue to carry a full valuation allowance against our gross deferred tax assets that will not reverse against deferred tax liabilities within the scheduled reversal period. If we determine in the future that it is more likely than not that we will realize all or a portion of our deferred tax assets, we will adjust our valuation allowance in the period we make the determination. We expect to provide a full valuation allowance on our future tax benefits until we can sustain a level of profitability that demonstrates our ability to realize these assets.
v3.23.2
Nature of Operations, Significant Accounting Policies and Going Concern (Tables)
 3 Months Ended
Mar. 31, 2023
Accounting Policies [Abstract]  
Schedule of estimated useful lives of property and equipment
Furniture and Equipment   5 years 
v3.23.2
Furniture and Equipment (Tables)
 3 Months Ended
Mar. 31, 2023
Property, Plant and Equipment [Abstract]  
Schedule of machinery and equipment
   March 31,
2023		   December 31,
2022		 
Furniture and equipment  $2,745   $2,745 
Machinery and Equipment  $47,202   $7,202 
Fixed assets, total  $49,947   $9,947 
Total: accumulated depreciation  $(1,785)  $
-
 
Fixed assets, net  $48,162   $9,947 
v3.23.2
Leases (Tables)
 3 Months Ended
Mar. 31, 2023
Leases Table [Abstract]  
Schedule of lease term and discount rate
   March  31, 
   2023 
Weighted average remaining lease term (years)   3.69 
Weighted average discount rate   4%

 
Schedule of lease costs
   Three Months ended
March  31,		 
   2023 
Operating lease cost  $19,093 
Variable lease cost (1)   1,050 
Total lease costs  $20,143 
(1) Variable lease cost primarily relates to common area maintenance, property taxes and insurance on leased real estate.
Schedule of supplemental disclosures of cash flow information
   March 31, 
   2023 
Cash paid for operating lease liabilities  $
    -
 
Schedule of maturities of lease liabilities
    Operating  
    Leases  
2023   $ 56,700  
2024     75,915  
2025     79,380  
2026     72,765  
Thereafter     -  
Total undiscounted lease payments     284,760  
Less: Present value discount     (23,291 )
Total Present value of lease liabilities   $ 264,219  
Schedule of supplemental balance sheet information
Operating Leases   Classification   March 31,
2023		  
Right-of-use assets   Right of use assets   $ 259,564  
             
Current lease liabilities   Current operating lease liabilities     64,330  
Non-current lease liabilities   Long-term operating lease liabilities     199,889  
Total lease liabilities       $ 264,219  
v3.23.2
Equity (Tables)
 3 Months Ended
Mar. 31, 2023
Stockholders' Equity Note [Abstract]  
Schedule of warrant activities
   Number of
Warrants		   Weighted-
Average
Exercise
Price Per
Share		   Weighted-
Average
Remaining
Life		 
Outstanding at August 31, 2022   438,723    5.03    0.36 
Granted   
-
    
-
    
-
 
Canceled or expired   (219,167)   2.45    
-
 
Outstanding at March 31, 2023   219,556   $7.81    0.33 years 
Exercisable at March 31, 2023   219,556   $7.81    0.33 years 
Intrinsic value at March 31, 2023       $
-
      
Schedule of option activities
   Number of
Options		   Weighted-
Average Exercise
Price Per
Share		   Weighted-
Average
Remaining
Life		 
Outstanding at December 31, 2022   1,023,842    2.67    8.95 years 
Granted   
-
    
-
    
 
 
Canceled or expired   
-
    
-
      
Exercised   
-
    
-
      
Outstanding at March 31, 2023   1,023,842   $2.67    8.71 years 
Exercisable at March  31, 2023   357,174   $2.67    8.69 years 
Intrinsic value at March 31, 2023       $
-
      
v3.23.2
Nature of Operations, Significant Accounting Policies and Going Concern (Details) - USD ($)
 3 Months Ended 12 Months Ended
Jan. 03, 2023
Mar. 31, 2023
Mar. 31, 2022
Dec. 31, 2022
Nature of Operations, Significant Accounting Policies and Going Concern (Details) [Line Items]        
Shares of common stock (in Shares) 222,223      
Common stock valued $ 50,000      
Common stock per share (in Dollars per share) $ 0.225      
Cash flows from operation   $ 207,068    
Working capital deficit   1,100,121    
Accumulated deficit   24,324,418    
FDIC limits   250,000    
Allowance for doubtful accounts   0   $ 0
Inventory finished goods   13,010   0
Inventory   13,010   0
Raw material, net reserve   $ 0   $ 0
Number of customers   three    
Accounts receivable, percentage       10.00%
Total sales   45.90% 10.00%  
Option anti-dilutive shares (in Shares)     1,022,842  
Shares warrants (in Shares)     562.967  
Warrant [Member]        
Nature of Operations, Significant Accounting Policies and Going Concern (Details) [Line Items]        
Shares warrants (in Shares)   1,023,842    
Customer One [Member]        
Nature of Operations, Significant Accounting Policies and Going Concern (Details) [Line Items]        
Accounts receivable, percentage   27.50%    
Sales percentage   14.40%    
Customer Two [Member]        
Nature of Operations, Significant Accounting Policies and Going Concern (Details) [Line Items]        
Sales percentage   15.10%    
Customer Three [Member]        
Nature of Operations, Significant Accounting Policies and Going Concern (Details) [Line Items]        
Sales percentage   16.40%    
Accounts Receivable [Member]        
Nature of Operations, Significant Accounting Policies and Going Concern (Details) [Line Items]        
Number of customers   two    
Accounts receivable, percentage   58.90%    
Accounts Receivable [Member] | Customer Two [Member]        
Nature of Operations, Significant Accounting Policies and Going Concern (Details) [Line Items]        
Accounts receivable, percentage   31.40%    
Options [Member]        
Nature of Operations, Significant Accounting Policies and Going Concern (Details) [Line Items]        
Option anti-dilutive shares (in Shares)   219,556    
v3.23.2
Nature of Operations, Significant Accounting Policies and Going Concern (Details) - Schedule of estimated useful lives of property and equipment
Mar. 31, 2023
Schedule of Estimated Useful Lives of Property and Equipment [Abstract]  
Furniture and Equipment 5 years
v3.23.2
Asset Purchase Agreement (Details) - USD ($)
 3 Months Ended
Mar. 31, 2023
Jan. 03, 2023
Dec. 31, 2022
Aug. 11, 2022
Asset Purchase Agreement Details [Abstract]        
Number of shares (in Shares) 222,223 222,223   2,777,778
Common stock value   $ 50,000    
Per share value (in Dollars per share)   $ 0.225    
Common shares issued (in Shares) 10,168,220   9,945,977  
Fair value $ 50,000      
Licenses amount 10,000      
Fixed assets acquired 40,000      
Business Combinations [Member]        
Asset Purchase Agreement Details [Abstract]        
Consideration paid $ 50,000      
Common Stock [Member]        
Asset Purchase Agreement Details [Abstract]        
Common shares issued (in Shares) 222,223      
v3.23.2
Inventory Earn-Out (Details) - USD ($)
Nov. 11, 2022
Aug. 31, 2022
Inventory Disclosure [Abstract]    
Operating profit, sale percentage   40.00%
Inventory earn out $ 90,000 $ 75,000
v3.23.2
Note Receivable (Details) - USD ($)
 12 Months Ended
Oct. 25, 2022
Feb. 08, 2022
Jan. 19, 2022
Dec. 31, 2022
Receivables [Abstract]        
Promissory note $ 25,000 $ 10,000 $ 10,000 $ 45,931
Annual interest rate 5.00% 5.00% 5.00%  
Maturity date Feb. 08, 2023 Feb. 08, 2023 Jan. 18, 2023  
Accrued interest       $ 931
v3.23.2
Furniture and Equipment (Details) - USD ($)
 3 Months Ended
Mar. 31, 2023
Mar. 31, 2022
Property, Plant and Equipment [Abstract]    
Depreciation expense $ 1,785 $ 0
v3.23.2
Furniture and Equipment (Details) - Schedule of machinery and equipment - USD ($)
Mar. 31, 2023
Dec. 31, 2022
Property, Plant and Equipment [Line Items]    
Fixed assets, total $ 49,947 $ 9,947
Total: accumulated depreciation (1,785)
Fixed assets, net 48,162 9,947
Furniture and equipment [Member]    
Property, Plant and Equipment [Line Items]    
Fixed assets, total 2,745 2,745
Machinery and Equipment [Member]    
Property, Plant and Equipment [Line Items]    
Fixed assets, total $ 47,202 $ 7,202
v3.23.2
Note Payable – Related Party (Details) - USD ($)
Mar. 31, 2023
Dec. 31, 2022
Debt Disclosure [Abstract]    
Additional loan amount $ 227,000  
Loan amount owed $ 692,500 $ 415,500
v3.23.2
Leases (Details)
 3 Months Ended
Mar. 31, 2023
USD ($)
Leases [Abstract]  
Lease term 5 years
Renew for an additional term 5 years
Rent amount $ 6,000
Purchase of property $ 600,000
v3.23.2
Leases (Details) - Schedule of lease term and discount rate
Mar. 31, 2023
Schedule Of Lease Term And Discount Rate Abstract  
Weighted average remaining lease term (years) 3 years 8 months 8 days
Weighted average discount rate 4.00%
v3.23.2
Leases (Details) - Schedule of lease costs
 3 Months Ended
Mar. 31, 2023
USD ($)
Schedule Of Lease Costs Abstract  
Operating lease cost $ 19,093
Variable lease cost 1,050 [1]
Total lease costs $ 20,143
[1] Variable lease cost primarily relates to common area maintenance, property taxes and insurance on leased real estate.
v3.23.2
Leases (Details) - Schedule of supplemental disclosures of cash flow information
 3 Months Ended
Mar. 31, 2023
USD ($)
Schedule Of Supplemental Disclosures Of Cash Flow Information Abstract  
Cash paid for operating lease liabilities
v3.23.2
Leases (Details) - Schedule of maturities of lease liabilities
Mar. 31, 2023
USD ($)
Schedule Of Maturities Of Lease Liabilities Abstract  
2023 $ 56,700
2024 75,915
2025 79,380
2026 72,765
Thereafter
Total undiscounted lease payments 284,760
Less: Present value discount (23,291)
Total Present value of lease liabilities $ 264,219
v3.23.2
Leases (Details) - Schedule of supplemental balance sheet information - USD ($)
 3 Months Ended
Mar. 31, 2023
Dec. 31, 2022
Schedule Of Supplemental Balance Sheet Information Abstract    
Right-of-use assets, Classification Right of use assets  
Right-of-use assets $ 259,564 $ 275,912
Current lease liabilities, Classification Current operating lease liabilities  
Current lease liabilities $ 64,330 64,330
Non-current lease liabilities, Classification Long-term operating lease liabilities  
Non-current lease liabilities $ 199,889 $ 216,039
Total lease liabilities $ 264,219  
v3.23.2
Equity (Details) - USD ($)
 3 Months Ended 4 Months Ended 12 Months Ended
Jan. 03, 2023
Aug. 01, 2022
Dec. 14, 2021
Dec. 13, 2021
Mar. 31, 2023
Mar. 31, 2022
Dec. 31, 2021
Dec. 31, 2022
Dec. 31, 2021
Equity (Details) [Line Items]                  
Common stock, shares authorized         3,000,000,000     3,000,000,000  
Common stock, par value         $ 0.001     $ 0.001  
Preferred stock, shares authorized         50,000,000     50,000,000  
Preferred stock, par value         $ 0.001     $ 0.001  
Preferred stock, shares issued         1     1  
Preferred stock, shares outstanding         1     1  
Shares of common stock 222,223                
Common stock valued $ 50,000                
Common stock per share $ 0.225                
Vesting period     10 years            
Prepaid expenses               $ 675,000  
Description of employment agreement     the Company entered into an employment agreement with Michael Feinsod, the Company’s chief executive officer and chairman. Pursuant to the employment agreement, Mr. Feinsod will continue to serve as the Company’s chief executive officer and chairman and will receive a base monthly salary of $10,000. The Company also granted to Mr. Feinsod, pursuant to the Company’s 2021 Equity Incentive Plan, 1,000,000 shares of restricted common stock valued at $1,350,000 ($1.35 per share), which vested one year from the date of grant. During the year ended December 31, 2022 the Company recorded $1,350,000 of prepaid expenses associated with the stock based compensation.            
Prepaid stock award         $ 58,569     $ 80,113  
Shares issued to investors             50,000,000 1,530,897  
Warrants to purchase               1,530,897  
Warrant purchase price             $ 250,000 $ 344,450  
Warrant expire date               Jun. 30, 2023  
Exercise price             $ 2.25 $ 2.25  
Shares of common stock   266,667              
Vest shares   155,556              
Expenses               $ 1,104,928  
Expense amount         21,544        
Shares sold to investors             12,500,000    
Legal expenses             $ 10,000    
Warrants term             1 year   1 year
Option valued amount         450,000        
Stock based compensation expenses         30,811 $ 97,797      
Options to purchase     22,222            
Options exercise price     $ 1.35            
Options vest valued     $ 30,000            
Stock option expenses         0 24,900      
Future expense         $ 420,381        
Warrants [Member]                  
Equity (Details) [Line Items]                  
Shares issued to investors               1,530,887  
Warrant purchase price               $ 344,450  
Warrant expire date               Jun. 30, 2023  
Exercise price               $ 2.25  
Shares sold to investors               382,722  
2021 Equity Incentive Plan [Member]                  
Equity (Details) [Line Items]                  
Sale of stock, number of shares issued     6,666,667            
Fair market value of common stock, percentage     100.00%            
Option grant date term     10 years            
Vest One [Member]                  
Equity (Details) [Line Items]                  
Vesting period   1 year              
Vest shares   55,556              
Vest Two [Member]                  
Equity (Details) [Line Items]                  
Vesting period   2 years              
Vest shares   55,556              
Series A Preferred Stock [Member]                  
Equity (Details) [Line Items]                  
Preferred stock, shares designated         1,000     1,000  
Preferred stock, shares issued              
Preferred stock, shares outstanding              
Series C Preferred Stock                  
Equity (Details) [Line Items]                  
Preferred stock, shares issued         1     1  
Preferred stock, shares outstanding         1     1  
Preferred stock stated value         $ 24,000        
Voting power of percentage         51.00%        
Mr. Garth [Member]                  
Equity (Details) [Line Items]                  
Base monthly salary     $ 8,000            
Mr. Garth [Member] | 2021 Equity Incentive Plan [Member]                  
Equity (Details) [Line Items]                  
Vesting period     1 year            
Mr. Garth [Member] | Restricted Stock [Member] | 2021 Equity Incentive Plan [Member]                  
Equity (Details) [Line Items]                  
Sale of stock, number of shares issued     500,000            
Common stock value     $ 675,000            
Common stock value, per share     $ 1.35            
Hunter Garth [Member]                  
Equity (Details) [Line Items]                  
Amortized amount             $ 31,438 $ 643,562 $ 31,438
Hunter Garth [Member] | Equity Option [Member]                  
Equity (Details) [Line Items]                  
Sale of stock, number of shares issued     333,333            
Common stock exercise price     $ 2.7            
Premium over closing price, percentage       120.00%          
Options were valued         $ 450,000        
Michael Feinsod [Member]                  
Equity (Details) [Line Items]                  
Amortized amount             $ 62,877 1,287,123 62,877
Prepaid stock award               $ 0 $ 1,287,123
Stock based compensation expenses         61,621 $ 135,594      
Michael Feinsod [Member] | 2021 Equity Incentive Plan [Member]                  
Equity (Details) [Line Items]                  
Sale of stock, number of shares issued     666,667            
Common stock exercise price     $ 2.7            
Premium over closing price, percentage       120.00%          
Options were valued         $ 900,000        
v3.23.2
Equity (Details) - Schedule of warrant activities - Warrants [Member]
 3 Months Ended
Mar. 31, 2023
$ / shares
shares
Class of Warrant or Right [Line Items]  
Number of Warrants, Outstanding, Beginning balance (in Shares) | shares 438,723
Weighted-Average Price Per Share, Outstanding, Beginning balance $ 5.03
Weighted- Average Remaining Life, Outstanding, Beginning balance 4 months 9 days
Number of Warrants, Granted (in Shares) | shares
Weighted-Average Price Per Share, Granted
Weighted- Average Remaining Life, Granted
Number of Warrants, Canceled or expired (in Shares) | shares (219,167)
Weighted-Average Price Per Share, Cancelled or expired $ 2.45
Weighted- Average Remaining Life, Cancelled or expired
Number of Warrants, Outstanding, Ending balance (in Shares) | shares 219,556
Weighted-Average Price Per Share, Outstanding, Ending balance $ 7.81
Weighted- Average Remaining Life, Outstanding, Ending balance 3 months 29 days
Number of Warrants, Exercisable (in Shares) | shares 219,556
Weighted-Average Price Per Share, Exercisable $ 7.81
Weighted- Average Remaining Life, Exercisable 3 months 29 days
Weighted-Average Price Per Share Intrinsic value
v3.23.2
Equity (Details) - Schedule of option activities - Options [Member]
 3 Months Ended
Mar. 31, 2023
$ / shares
shares
Equity (Details) - Schedule of option activities [Line Items]  
Number of Options, Outstanding, Beginning balance (in Shares) | shares 1,023,842
Weighted-Average Price Per Share, Outstanding, Beginning balance $ 2.67
Weighted- Average Remaining Life, Outstanding, Beginning balance 8 years 11 months 12 days
Number of Options, Granted (in Shares) | shares
Weighted-Average Price Per Share, Granted
Weighted- Average Remaining Life, Granted
Number of Options, Canceled or expired (in Shares) | shares
Weighted-Average Price Per Share, Canceled or expired
Number of Options, Exercised (in Shares) | shares
Weighted-Average Price Per Share, Exercised
Number of Options, Outstanding, Ending balance (in Shares) | shares 1,023,842
Weighted-Average Price Per Share, Outstanding, Ending balance $ 2.67
Weighted- Average Remaining Life, Outstanding, Ending balance 8 years 8 months 15 days
Number of Options, Exercisable (in Shares) | shares 357,174
Weighted-Average Price Per Share, Exercisable $ 2.67
Weighted- Average Remaining Life, Exercisable 8 years 8 months 8 days
Weighted-Average Price Per Share Intrinsic value
v3.23.2
Related Party Transactions (Details) - USD ($)
 3 Months Ended 12 Months Ended
Dec. 14, 2021
Dec. 14, 2021
Dec. 13, 2021
Mar. 31, 2023
Dec. 31, 2022
Related Party Transactions (Details) [Line Items]          
Exercise price (in Dollars per share)   $ 1.35      
Advance amount       $ 277,000 $ 415,500
Accrued salary       105,000  
Accounts payable       $ 78,936  
Chief Executive Officer [Member]          
Related Party Transactions (Details) [Line Items]          
Shares of loaned (in Shares)         2,500
Hunter Garth [Member]          
Related Party Transactions (Details) [Line Items]          
Salary $ 8,000        
Mr. Garth [Member]          
Related Party Transactions (Details) [Line Items]          
Shares of common stock (in Shares) 333,333        
Exercise price (in Dollars per share) $ 2.7        
Common stock percentage     120.00%    
Mr. Garth [Member] | 2021 Equity Incentive Plan [Member]          
Related Party Transactions (Details) [Line Items]          
Restricted common stock shares (in Shares) 500,000        
Vested term 1 year        
Michael Feinsod [Member]          
Related Party Transactions (Details) [Line Items]          
Salary $ 10,000        
Mr. Feinsod [Member]          
Related Party Transactions (Details) [Line Items]          
Shares of common stock (in Shares) 666,667        
Exercise price (in Dollars per share) $ 2.7        
Common stock percentage     120.00%    
Mr. Feinsod [Member] | 2021 Equity Incentive Plan [Member]          
Related Party Transactions (Details) [Line Items]          
Vested term 1 year        
Shares of common stock (in Shares) 1,000,000        
v3.23.2
Commitments and Contingencies (Details) - USD ($)
 1 Months Ended
Dec. 14, 2021
Dec. 13, 2021
Aug. 02, 2021
Aug. 31, 2022
Mar. 31, 2023
Jan. 03, 2023
Nov. 11, 2022
Aug. 11, 2022
Commitments and Contingencies (Details) [Line Items]                
Principal amount     $ 400,000          
Operating profit, percentage       40.00%        
Final payment of inventory earn out       $ 75,000        
Payment inventory             $ 90,000  
Purchase Obligation, to be Paid, Year Three             $ 3  
Executive officer salary $ 8,000              
Common stock ,options to purchase (in Shares) 666,667              
Exercise price (in Dollars per share) $ 0.06              
Premium percentage   120.00%            
Common stock shares issued (in Shares)         222,223 222,223   2,777,778
Equity Incentive Plan [Member]                
Commitments and Contingencies (Details) [Line Items]                
Restricted common stock (in Shares) 500,000              
Common Stock [Member]                
Commitments and Contingencies (Details) [Line Items]                
Exercise price (in Dollars per share) $ 2.7              
Premium percentage   120.00%            
Restricted Common Stock [Member]                
Commitments and Contingencies (Details) [Line Items]                
Restricted common stock (in Shares) 1,000,000              
Grant [Member]                
Commitments and Contingencies (Details) [Line Items]                
Common stock ,options to purchase (in Shares) 333,333              
Chief Executive Officer [Member]                
Commitments and Contingencies (Details) [Line Items]                
Executive officer salary $ 10,000              
v3.23.2
Subsequent Events (Details)
Mar. 31, 2023
USD ($)
Subsequent Events [Abstract]  
Additional loaned $ 157,000
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