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Stockholders' Equity (Deficit) | 6 Months Ended
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Jun. 30, 2023
Equity [Abstract] |
Stockholders' Equity (Deficit) |
| 6. | STOCKHOLDERS’ EQUITY (DEFICIT)
Recapitalization and Amended and Restated Certificate of Incorporation In April 2023, the Company filed with the Secretary of State of Delaware Series B Certificate of Designation, the Company is authorized to issue up to 1,000 shares of Series B Preferred Stock with a stated value of $1,000 per share. In March 2022, the Company restated its Certificate of Incorporation to authorize 110,000,000 shares, consisting of 10,000,000 shares of preferred stock and 100,000,000 shares of common stock, both with a par value of $0.00001 per share. Upon the filing of the Amended and Restated Certification of Incorporation, each share of the Company’s Class A and Class B common stock was exchanged for one share of common stock, or an aggregate of 6,598,240 shares and 10,000 shares of Series A preferred stock. As of June 30, 2023, there were 100,000 and 1,000 shares designated as Series A preferred stock and Series B preferred stock, respectively. Series A Preferred Stock Each share of Series A Preferred Stock is entitled to 10,000 votes. The holders of shares of Preferred Stock are entitled to vote on all matters on which the common stock shall be entitled to vote. The holders of the Series A Preferred Stock are not entitled to dividends. Upon the event of liquidation, dissolution or winding up of the Company, voluntary or involuntary, the holders of our Series A Preferred Stock would be entitled to receive the initial stated value of the Company’s preferred stock. Series B Preferred Stock All of the outstanding shares of Series B Preferred Stock shall automatically convert along with the aggregate accrued or accumulated and unpaid dividends thereon into an aggregate number of shares of common stock as is determined by dividing the stated value per share along with the aggregate accrued or accumulated and unpaid dividends on the outstanding shares of Series B Preferred Stock by the Conversion Price, which means 50% of the purchase price per share in a Qualified Public Offering. Upon the Company’s IPO in July 2023, all shares of Series B Preferred Stock were converted into 500,000 shares of common stock (see Note 9). Transactions On April 11, 2023, the Company sold 1,000 shares of Series B Preferred Stock to one accredited investor for an aggregate purchase price of $1,000,000, or value of $1,000 per share. As of June 30, 2023 and December 31, 2022, the Company had 10,000 shares of Series A preferred stock, 1,000 shares of Series B preferred stock and 7,064,008 shares of common stock issued and outstanding. Janover Inc. 2021 Equity Incentive Plan In November 2021, the Board of Directors adopted the Company’s 2021 Equity Incentive Plan (the “2021 Plan”), effective as of November 1, 2021. The 2021 Plan provides for the grant of the following types of stock awards: (i) incentive stock options, (ii) non statutory stock options, (iii) stock appreciation rights, (iv) restricted stock awards, (v) restricted stock unit awards and (vi) other stock awards. The 2021 Plan is intended to help the Company secure and retain the services of eligible award recipients, provide incentives for such persons to exert maximum efforts for the success of the Company and any affiliate and provide a means by which the eligible recipients may benefit from increases in value of the common stock. The Board will administer the 2021 Plan until a Compensation Committee is established. The Board reserved 659,824 shares of common stock issuable upon the grant of awards. Stock options comprise all of the awards granted since the 2021 Plan’s inception. As of June 30, 2023, there were 237,610 shares available for grant under the 2021 Plan. A summary of information related to stock options for the six months ended June 30, 2023 is as follows:
|  | Options |  |  | Weighted Average Exercise Price |  |  | Intrinsic Value |
Outstanding as of December 31, 2022 |  |  | 427,713 |  |  | $ | 1.40 |  |  | $ | 665,330 |
Forfeited |  |  | (5,499 | ) |  |  | 6.14 |  |  |  |  |
Outstanding as of June 30, 2023 |  |  | 422,214 |  |  | $ | 1.34 |  |  | $ | 853,536 |
Exercisable as of December 31, 2022 |  |  | 271,481 |  |  | $ | 1.37 |  |  | $ | 551,123 |
Exercisable as of June 30, 2023 |  |  | 284,402 |  |  | $ | 1.59 |  |  | $ | 650,570 |
The weighted average duration to expiration for outstanding options at June 30, 2023 was 8.46 years. The following table presents, on a weighted average basis, the assumptions used in the Black-Scholes option-pricing model to determine the grant-date fair value of stock options granted:
|  | Six Months Ended |
|  | June 30, |
|  | 2023 |  |  | 2022 |
Risk-free interest rate |  |  | n/a |  |  |  | 1.92 | %
Expected term (in years) |  |  | n/a |  |  |  | 5.61 |
Expected volatility |  |  | n/a |  |  |  | 35.00 | %
Expected dividend yield |  |  | n/a |  |  |  | 0 | %
Stock-based compensation expense of $103,876, $208,756, $203,032 and $467,206 was recognized for the three and six months ended June 30, 2023 and 2022, respectively. Total unrecognized compensation cost related to non-vested stock option awards amounted to $225,228 as of December 31, 2022, which will be recognized over a weighted average period of 1.25 years. Stock-based compensation, including options and shares issued for services was classified in the statements of operations as follows:
|  | Six Months Ended |
|  | June 30, |
|  | 2023 |  |  | 2022 |
Sales and marketing |  | $ | 68,984 |  |  | $ | 147,383 |
Research and development |  |  | 38,353 |  |  |  | 45,517 |
General and administrative |  |  | 95,695 |  |  |  | 274,306 |
|  | $ | 203,032 |  |  | $ | 467,206 |

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