Stock Options and Warrants

Costs attributable to the issuance of stock options and share purchase warrants are measured at fair value at the date of issuance and offset with a corresponding increase in ‘Additional Paid in Capital' at the time of issuance. The fair value cost is computed utilizing the Black-Scholes model and assuming volatility based on U.S. Treasury yield rates for a similar period. The cost of these warrants was

not

recognized in the financial statements because they were granted in connection with raising capital for the Company. When the options or warrants are exercised, the receipt of consideration will be reported as an increase in stockholders' equity.

Concurrently with certain securities purchase agreements entered into, warrants to purchase the Company's Common Stock were issued to the subscribers. Each warrant is exercisable for a period of

five

years from the date of the securities purchase agreement at an exercise price of

$1.95

per share (Note

). The fair value cost at the date of issuance of these warrants was

$614,805.

In conjunction with the issuance of convertible notes payable as described in Note

a warrant for the purchase of up to

115,385

shares of Common Stock exercisable for a

one

-year period was issued at an exercise price of

$0.01

per share and another warrant for the purchase of up to

360,000

shares of Common Stock exercisable for a

five

-year period was issued at an exercise price of

$1.00

per share. During the quarter ended

September 30, 2020,

the warrants for the purchase of

115,385

shares of Common Stock were exercised at

$0.01

and as of

September 30, 2020,

there are warrants fo the purchase of up to

476,348

shares of Common Stock outstanding.

	Number of Shares			Exercise Price		Weighted Average Remaining Life (in years)
Warrants as of December 31, 2018		-			-
Issued during 2019		84,295		$	1.95
Warrants as of December 31, 2019		84,295		$	1.95		4.53
Issued during 2020		115,385		$	0.01
Issued during 2020		32,053		$	1.95
Issued during 2020		360,000		$	1.00
Exercised during 2020		(115,385	)	$	0.01
Warrants as of September 30, 2020		476,348		$	0.97		8.57