Quarterly report pursuant to Section 13 or 15(d)

Stockholders??? (Deficit)

v3.23.1
Stockholders’ (Deficit)
 3 Months Ended
Mar. 31, 2023
Equity [Abstract]  
Stockholders’ (Deficit)

Note 8 – Stockholders’ (Deficit)

 

Capital Stock

 

The Company has 260,000,000 authorized shares of capital stock, consisting of 250,000,000 shares of Common Stock, par value $0.001, and 10,000,000 shares of Preferred Stock, par value $0.001 per share.

  

Common Stock Options

 

A summary of the Company’s options activity and related information follows:

  

Schedule of option activity and related information                
    Number of     Weighted   Weighted
    Shares Range of   Average   Average
    Under Option Price   Exercise   Contractual
    Options Per Share   Price   Life
Options Outstanding at January 1, 2023     301,391      $ 1.48 – 15.76     $ 3.46       7.45  
Options Granted     243,605       1.52 – 1.96       1.77       10.00  
Exercised     —       —       —       —  
Expired/Cancelled     (29,213 )   2.16 – 5.80       3.76       —  
Options Outstanding at March 31, 2023     515,783     $ 1.48 - 14.00     $ 2.65       8.36  
                                 
Options Exercisable at March 31, 2023     166,352      $ 1.48 - 14.00     $ 3.69       5.76  

  

Share-based compensation expense for options totaling $54,433 and $66,505 was recognized in our results for the three months ended March 31, 2023, and 2022, respectively.

 

The valuation methodology used to determine the fair value of the options issued during the year was the Black-Scholes option-pricing model. The Black-Scholes model requires the use of a number of assumptions including the volatility of the stock price, the average risk-free interest rate, and the weighted average expected life of the options.

 

The risk-free interest rate assumption is based upon observed interest rates on zero-coupon U.S. Treasury bonds whose maturity period is appropriate for the term of the options.

 

Estimated volatility is a measure of the amount by which the Company’s stock price is expected to fluctuate each year during the expected life of the award. The Company’s calculation of estimated volatility is based on historical stock prices of the Company over a period equal to the expected life of the awards.

 

As of March 31, 2023, there was $636,464 of total unrecognized compensation expense related to unvested employee options granted under the Company’s share-based compensation plans that is expected to be recognized over a weighted average period of approximately 2.48 years.

 

The weighted average fair value of options granted, and the assumptions used in the Black-Scholes model during the three months ended March 31, 2023, and 2022, are set forth in the table below.

   

                 
    2023   2022
Weighted average fair value of options granted   $ 1.77     $ 3.30    
Risk-free interest rate     3.48% – 4.01 %     1.63% – 2.32 %  
Volatility     196% – 199 %     212% – 214 %  
Expected life (years)     10 years       10 years    
Dividend yield   $ — %   $ — %  

  

Share-based awards, restricted stock award (“RSAs”)

 

On March 1, 2023, the Company granted certain employees 73,530 RSA’s. Compensation as a group, amounts to $130,883. The shares vest one third each year for three years after issuance.

 

On March 28, 2023, the Company granted certain employees 44,942 RSA’s. Compensation as a group, amounts to $72,357. The shares vest one third each year for three years after issuance.

 

On March 31, 2023, the Board resolved that the Company shall pay each member of the Board compensation as a group amount of $22,750. The shares vest one year after issuance.

 

A summary of the activity related to RSUs for the three months ended March 31, 2023, is presented below:

  

               
    Total   Grant Date
Restricted Stock Units (RSUs)   Shares   Fair Value
RSUs non-vested at January 1, 2023   50,000     $ 1.48 - 3.23  
RSUs granted   130,972     $ 1.61 – 1.82  
RSUs vested     (12,500 )   $ 3.23  
RSUs forfeited     —     $ —  
RSUs non-vested March 31, 2023   168,472     $ 1.48 – 2.45  

  

Stock-based compensation for RSU’s has been recorded in the consolidated statements of operations and totaled $52,285 for the three months ended March 31, 2023.