15.	STOCKHOLDERS' EQUITY

Preferred Stock

Within the limits and restrictions provided in the Company's Certificate of Incorporation, the Board of Directors has the authority, without further action by the shareholders, to issue up to

5,000,000

shares of preferred stock,

$.0001

par value per share, in

one

or more series, and to fix, as to any such series, any dividend rate, redemption price, preference on liquidation or dissolution, sinking fund terms, conversion rights, voting rights, and any other preference or special rights and qualifications. As of

June 30, 2020,

100,000

shares of preferred stock have been designated as Series A-

Convertible Preferred Stock and

105,000

shares of preferred stock have been designated as Series B-

Convertible Preferred Stock. There was

preferred stock outstanding as of

June 30, 2020

December 31, 2019.

Warrants

Securities Purchase Agreement dated

November 13, 2014:

As part of a Securities Purchase Agreement, dated

November 13, 2014,

by and between the Company and a number of private and institutional investors, the Company issued to certain private investors warrants to purchase

996,877

shares of common stock. The warrants expired in

November 2019.

Securities Purchase Agreement dated

September 23, 2015:

September 23, 2015,

the Company issued warrants (the

“2015

Warrants”) to purchase

69,445

shares of common stock in connection with the issuance of a promissory note. The warrants were immediately exercisable at an initial exercise price of

$3.60

per share and have a term of

five

years.

The

2015

Warrants have a "full ratchet" anti-dilution adjustment provision which is triggered in the event the Company sells or

grants any additional shares of common stock, options, warrants or other securities that are convertible into common stock at a price lower than

$3.60

per share. The anti-dilution adjustment provision is

not

triggered by certain "exempt issuances" which among other issuances, includes the issuance of shares of common stock, options or other securities to officers, employees, directors, consultants or service providers.

Anti-dilution adjustments were triggered as follows:

August 24, 2018

the Company issued warrants to certain investors which triggered the anti-dilution provisions included in the

2015

Warrants. As a result, the number of shares of common stock issuable upon the full exercise of the

2015

Warrants was increased from

69,445

166,668

shares, and the exercise price was reduced from

$3.60

$1.50

per share.

February 14, 2020,

the

February 2020

Note was issued at a conversion price of

$1.15

that triggered the anti-dilution provisions included in these warrants. In addition, the amendments to the Original Note reduced the conversion price of the Original Note to

$0.65

which also triggered the anti-dilution provision of the

2015

Warrants. As a result of the forgoing transactions, the number of shares of common stock issuable upon the full exercise of the

2015

Warrants increased to

384,618,

the exercise was reduced to

$0.65

per share, and the Company recorded a non-cash deemed dividend in amount of

$41,688.

Referral Fee:

The Company issued a warrant to an investor for

125,000

shares for a business referral valued at

$94,655

during the

three

months ended

June 30, 2020.

Common Stock

March 21

and

28,

2019,

the Company issued

13,820

shares of common stock to its directors in payment of board and board committee fees valued at

$16,506.

There were

shares of common stock issued in payment of board and board commitment fees in the

three

months ended

March 31, 2020.

April 2, 2020,

the Company issued

6,850

shares of common stock to its directors in payment of meeting fees valued at

$5,001.

May 12, 2020,

the Company issued

7,077

shares of common stock to its directors in payment of meeting fees valued at

$7,003.

May 14, 2020,

the Company issued

1,632

shares of common stock to its directors in payment of committee meeting fees valued at

$1,501.

June 8, 2020,

the Company issued

1,581

shares of common stock to its directors in payment of committee meeting fees valued at

$1,502.

See Note

- Convertible Notes Payable for common stock issuances related to conversion of convertible notes payable and shares of common stock issued for fees in connection with the agreements.

Issuances of Stock Options

April 2, 2020,

the Company issued a stock option to a new employee for

5,000

shares with a

three

-year vesting period,

seven

year term, and exercise price of

$0.73

per share.

The fair value of the option at date of issuance was estimated on the date of grant at

$2,267

using the Black-Scholes option-pricing model with the following assumptions: risk free interest rate:

0.36%,

expected life of options in years:

4.5,

expected dividends:

volatility of stock price:

83%.