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EQUITY
 9 Months Ended
Sep. 30, 2021
Equity [Abstract]  
EQUITY

NOTE 13 – EQUITY

 

Common Stock

 

On February 3, 2021, the Company issued an aggregate of 20,000 shares of common stock of the Company to a digital marketing consultant with an aggregate fair value of $42,600.

 

On February 3, 2021, the Company issued an aggregate of 16,126 shares of common stock of the Company to the members of the board of directors as compensation earned through the end of the fourth quarter of 2020.

 

On March 31, 2021, the Company authorized the issuance of an aggregate of 12,711 shares of common stock to the members of the board of directors as compensation earned during the first quarter of 2021.

 

On April 30, 2021, the Company issued an aggregate of 10,000 shares of common stock of the Company to a digital marketing consultant, pursuant to their service agreement, with an aggregate fair value of $14,700.

 

On May 6, 2021, the Company issued an aggregate of 150,000 shares of common stock of the Company to a digital marketing consultant with an aggregate fair value of $214,500. The Company accrued for the liability as accrued compensation expense on the books as of March 31, 2021, as the share were fully earned pursuant to their service agreement. On the date of issues of the shares the Company recorded a gain on the change in fair value of the accrued compensation of $127,500 in the condensed consolidated statement of operations.

 

On May 27, 2021, the Company cancelled 11,879 shares of common stock previously issued to an investor pursuant a settlement agreement in exchange for $100,000 the portion paid by the Company in the Settlement. See Note 12 – Commitments and Contingencies – Litigation, Claims and Assessments for further details related to the settlement.

 

On August 24, 2021, the Company issued an aggregate of 15,000 shares of common stock of the Company to a digital marketing consultant, pursuant to their service agreement, with an aggregate fair value of $20,999.

 

On August 24, 2021, the Company authorized the issuance of an aggregate of 20,829 shares of common stock to the members of the board of directors as compensation earned during the second quarter of 2021.

 

On August 26, 2021, the Company issued an aggregate of 1,100 shares of common stock of the Company to an investor in the Company.

 

See Note 4 – Acquisitions – Pokemoto Acquisition and SupferFit Foods Acquisition for details related to the stock issuance in connection with the acquisitions.

 

See Note 12 – Commitments and Contingencies – Consulting Agreements for details related to additional stock issuances during the nine months ended September 30, 2021.

 

See Note 13 – Equity – warrants for details related to stock issuance in connection with the exercising of warrants.

 

Restricted Common Stock

 

On February 11, 2021, the Company issued an aggregate of 221,783 shares of restricted common stock of the Company to various executives and an employee. The restricted common stock is fully vested upon the date of grant.

 

A summary of the activity related to the restricted common stock for the six months ended September 30, 2021 is presented below:

 

       Weighted
Average Grant		 
   Total  

Date Fair

Value

 
Outstanding at January 1, 2021   1,200   $65.33 
Granted   221,783    2.87 
Forfeited   -    - 
Vested   (222,983)    (3.21)
Outstanding at September 30, 2021   -   $- 

 

Stock-Based Compensation Expense

 

Stock-based compensation related to restricted stock issued to employees, directors and consultants and warrants issued to consultants amounted to $51,702 and $1,779,248 for the three and nine months ended September 30, 2021, respectively, of which $50,488 and $1,774,876, respectively, was recorded in general and administrative expenses and $1,215 and $4,372, respectively, was recorded in labor expense within restaurant operating expenses. Stock-based compensation related to restricted stock issued to employees, directors and consultants and warrants issued to consultants amounted to ($1,005,698) and $2,619,522 for the three and nine months ended September 30, 2020, respectively, of which ($1,006,656) and $2,617,460, respectively, was recorded in general and administrative expenses and $958 and $2,062, respectively, was recorded in labor expense within restaurant operating expenses.

 

 

MUSCLE MAKER, INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements

 

NOTE 13 – EQUITY, continued

 

Options

 

A summary of option activity during the three and nine months ended September 30, 2021 is presented below:

 

           Weighted 
          Average 
       Weighted   Remaining 
   Number of   Average   Life 
   Options   Exercise Price   In Years 
Outstanding, December 31, 2020   300,000   $3.33    1.1 
Issued   -    -      
Exercised   -    -      
Forfeited   (200,000)   2.50      
Outstanding, September 30, 2021   100,000   $5.00    2.18 
                
Exercisable, September 30, 2021   100,000   $5.00    2.18 

 

Warrants

 

A summary of warrants activity during the nine months ended September 30, 2020 is presented below:

 

   Number of Warrants   Weighted
Average
Exercise Price		  

Weighted
Average
Remaining

Life
In Years

 
Outstanding, December 31, 2020   2,582,857   $4.08    3.3 
Issued   6,980,454    1.44    - 
Exercised   (2,865,227)   0.01    - 
Forfeited/cancelled   (92,568)   19.99    - 
Outstanding, September 30, 2021   6,605,516   $2.83    4.1 
                
Exercisable, September 30, 2021   6,605,516   $2.83    4.1 

 

See Note 12 – Commitments and Contingencies – Private Placement for details related to the warrants issued during the six months ended June 30, 2021.

 

On May 24, 2021, the Company issued 1,465,227 shares of common stock in connection with the exercising of the Pre-Funded Warrant for $14,652.

 

On May 28, 2021, the Company issued 1,400,000 shares of common stock in connection with the exercising of the Pre-Funded Warrant for $14,000.

 

 

MUSCLE MAKER, INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements