XML 22 R11.htm IDEA: XBRL DOCUMENT
v3.23.2

STOCKHOLDERS’ EQUITY | 6 Months Ended
--- | ---
Jun. 30, 2023
Equity [Abstract] |
STOCKHOLDERS’ EQUITY | NOTE 5 - STOCKHOLDERS’ EQUITY Series A Preferred Stock On November 8, 2021, in connection with the Company’s public offering, the Company’s Board of Directors adopted a resolution allowing for the designation and issuance of 1,543,158 shares of the Company’s Preferred Stock, $.01 par value per share, designated as Series A Preferred Stock (“Series A”). The Series A had a liquidation preference of $0.001 per share. On September 8, 2022, the Company issued 1,543,158 shares of Series B Preferred Stock (“Series B”) to Auctus Fund, LLC (“Auctus”) in exchange for an equal number of shares of the Company’s outstanding Series A. Simultaneously, the stock certificate representing the Series A shares was being returned to the Company for cancellation. On such date and upon such exchange, the Company’s Board of Directors cancelled the Series A. Series B Preferred Stock Effective September 8, 2022, the Company issued 1,543,158 shares of Series B to Auctus in exchange for an equal number of shares of the Company’s outstanding Series A. The terms of the Series B are substantially identical to those of the Series A, except that, among other things, the limitation on beneficial ownership of Common Stock of the Company upon a conversion of the Series B into Common Stock, and the limitation on the number of votes attributable to the Series B, is 9.99% of the then outstanding Common Stock of the Company instead of 4.99% as provided for the Series A. The Company shall, at all times, reserve from its authorized and unissued Common Stock a sufficient number of shares to provide for the issuance of Common Stock upon the full conversion of the Series B. The Series B is not subject to redemption by the Company or any Series B holder. Dividends Series B holders shall be entitled to receive, when and as declared by the Board of Directors, dividends on a pari passu basis with the holders of the shares of Common Stock based upon the number of shares of Common Stock into which the Series B is then convertible. Voting Rights Series B holders shall be entitled to vote on all matters presented to the stockholders of the Company for a vote at a meeting of stockholders of the Company or a written consent in lieu of a meeting of stockholders of the Company, and shall be entitled to such number of votes for each share of Series B entitled to vote at such meetings or pursuant to such consent, voting together with the holders of shares of Common Stock and other shares of preferred stock who are entitled to vote, and not as a separate class, except as required by law. The number of votes to which the Series B holders shall be entitled to vote for each share of Series B shall equal the number of shares of Common Stock into which such Series B is then convertible; provided, however, that in no event shall a Series B holder be entitled to vote more than 9.99% of the then outstanding shares of Common Stock. Conversion Optional Conversion - Each share of Series B shall be convertible, at any time and from time to time, at the option of the Series B holder, into one share of Common Stock; provided, however, that in no event shall a Series B holder be entitled to convert any shares of Series B to the extent that such conversion would result in beneficial ownership by such Series B holder of more than 9.99% of the outstanding shares of Common Stock. Automatic Conversion – From time to time, if an event occurs, including adjustment due to merger, consolidation, etc., subdivision or combination of Common Stock, adjustment due to distribution, purchase rights, and notice of adjustments, which has the effect of reducing a Series B holder’s beneficial ownership of shares of Common Stock to less than 9.5% of the then publicly disclosed outstanding shares of Common Stock, then, within five (5) business days, the Series B holder shall provide notice to the Company to such effect, which notice shall state the number of shares of Common Stock beneficially owned by the Series B holder and shall provide reasonable detail with regard thereto, including the number of derivative securities compromising a portion of such beneficial share amount. Such notice shall have the effect of a notice of conversion with respect to the conversion of such number of shares of Series B as would increase the Series B holder’s beneficial ownership of Common Stock to 9.99% of the then publicly disclosed outstanding shares of Common Stock. On April 4, 2023, Auctus converted 120,000 shares of Series B into 120,000 shares of Common Stock. As of June 30, 2023, the number of shares of Series B remaining outstanding after giving effect to such conversion was 1,398,158. Warrant and Option Valuation The Company has computed the fair value of warrants and options granted using the Black-Scholes option pricing model. The expected term used for warrants and options issued to non-employees is the contractual life and the expected term used for options issued to employees and directors is the estimated period of time that options granted are expected to be outstanding. The Company utilizes the “simplified” method to develop an estimate of the expected term of “plain vanilla” employee option grants. The Company is utilizing an expected volatility figure based on a review of the historical volatilities, over a period of time equivalent to the expected life of the instrument being valued, of similarly positioned public companies within its industry. The risk-free interest rate was determined from the implied yields from U.S. Treasury zero-coupon bonds with a remaining term consistent with the expected term of the instrument being valued. Stock Options There were no stock options granted during the three months ended June 30, 2023. The Company granted options for the purchase of 629,017 shares of Common Stock during the six months ended June 30, 2023. The grant date fair value of options issued during the six months ended June 30, 2023 was $1,745,000. There were no stock options granted during the three months ended June 30, 2022. The Company granted options for the purchase of 25,000 shares of Common Stock during the six months ended June 30, 2022. The grant date fair value of options issued during the six months ended June 30, 2022 was $122,117. In applying the Black-Scholes option pricing model to stock options granted during the six months ended June 30, 2023, the Company used the following assumptions: SCHEDULE OF STOCK OPTIONS GRANTED ASSUMPTIONS
|  | For the Six Months Ended |  |  | For the Six Months Ended |
|  | June 30, |  |  | June 30, |
|  | 2023 |  |  | 2022 |
Risk free interest rate |  |  | 4.22 | % |  |  | 2.42 | %
Expected term (years) |  |  | 3.50 |  |  |  | 3.50 |
Expected volatility |  |  | 175 | % |  |  | 286 | %
Expected dividends |  |  | 0.00 | % |  |  | 0.00 | %
A summary of the stock option activity during the six months ended June 30, 2023 is presented below: SCHEDULE OF STOCK OPTION ACTIVITY
|  | Number of Options |  |  | Weighted Average Exercise Price |
Outstanding, January 1, 2023 |  |  | 864,639 |  |  | $ | 5.08 |
Granted |  |  | 629,017 |  |  |  | 2.91 |
Expired |  |  | - |  |  |  | — |
Forfeited |  |  | (26,766 | ) |  |  | 5.08 |
Outstanding, June 30, 2023 |  |  | 1,466,890 |  |  | $ | 4.17 |
Exercisable, June 30, 2023 |  |  | 1,041,062 |  |  | $ | 4.66 |
Restricted Stock Units Pursuant to the Company’s 2021 Stock Incentive Plan (the “2021 Plan”), the Company may grant restricted stock units (“RSUs”) to employees, consultants or non-employee directors (“Eligible Individuals”). The number, terms and conditions of the RSUs that are granted to Eligible Individuals are determined on an individual basis by the 2021 Plan administrator. On the distribution date, the Company shall issue to the Eligible Individual one unrestricted, fully transferable share of the Company’s Common Stock (or the fair market value of one such share in cash) for each vested and nonforfeitable RSU. A summary of the Company’s unvested RSUs as of June 30, 2023 is as follows: SCHEDULE OF UNVESTED RESTRICTED STOCK UNITS
|  |  | Number of Shares |
Outstanding, December 31, 2022 |  |  |  | 201,870 |
Granted |  |  |  | - |
Forfeited |  |  |  | - |
Vested |  |  |  | (104,043 | )
Outstanding, June 30, 2023 |  |  |  | 97,827 |
The following table presents stock compensation by award type: SCHEDULE OF STOCK COMPENSATION BY AWARD TYPE
|  | For the Three Months Ended June 30, |
|  | 2023 |  |  | 2022 |
Options |  | $ | 321,534 |  |  | $ | 1,865,297 |
RSUs |  |  | 1,164,135 |  |  |  | 1,190,349 |
Shares issued for services |  |  | - |  |  |  | 48,504 |
|  | $ | 1,485,669 |  |  | $ | 3,104,150 |
|  | For the Six Months Ended June 30, |
|  | 2023 |  |  | 2022 |
Options |  | $ | 2,511,962 |  |  | $ | 4,004,246 |
RSUs |  |  | 2,312,885 |  |  |  | 2,354,474 |
Shares issued for services |  |  | - |  |  |  | 121,322 |
|  | $ | 4,824,847 |  |  | $ | 6,480,042 |
Stock based compensation is included in General and administrative expenses on the consolidated statements of operations. As of June 30, 2023, unrecognized stock based compensation expense is $1,201,875 with a weighted average remaining amortization period of 1.04 years.

X
- References No definition available. + Details
Name: | us-gaap_EquityAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for equity. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481112/505-10-50-13 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481112/505-10-50-13 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481112/505-10-50-14 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 235 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481062/946-235-50-2 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 235 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481062/946-235-50-2 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 505 -Name Accounting Standards Codification -Section 50 -Paragraph 6 -Publisher FASB -URI https://asc.fasb.org//1943274/2147481004/946-505-50-6 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 40 -Name Accounting Standards Codification -Section 50 -Paragraph 6 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480237/815-40-50-6 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.3-04) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480008/505-10-S99-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(e)(1)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1 Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 505 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//505/tableOfContent Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Publisher FASB -URI https://asc.fasb.org//1943274/2147481112/505-10-50-13 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Subparagraph (g) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481112/505-10-50-13 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Subparagraph (i) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481112/505-10-50-13 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481112/505-10-50-14 Reference 15: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Subparagraph (c) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481112/505-10-50-14 Reference 16: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 16 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481112/505-10-50-16 Reference 17: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 18 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481112/505-10-50-18 Reference 18: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 18 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481112/505-10-50-18 Reference 19: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 18 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481112/505-10-50-18 + Details
Name: | us-gaap_StockholdersEquityNoteDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration