WARRANTS AND PREFERRED STOCKS

12 Months Ended

Dec. 31, 2022

WARRANTS AND PREFERRED STOCKS

WARRANTS AND PREFERRED STOCKS

NOTE 6 - WARRANTS AND PREFERRED STOCKS:

Warrants

2021 Extension of Warrant Terms

On September 7, 2021, the Company, acting by resolution of its Board of Directors, amended and extended the expiration date of its outstanding warrants to purchase up to 6,909,000 shares of common stock. In addition to extending the expiration date to March 7, 2023, the Company removed (i) a provision automatically exercising the Warrants on a “cashless” basis of its stock traded above the exercise price for the five (5) days prior to expiration and (ii) the right of warrant holders to participate in any distribution to its stockholders by the Company, to the extent the warrants were unexercised at the time of such a distribution; the exercise price and all other terms of the original warrant agreement remain the same. The warrants modification expense of $1,450,890 was computed as the incremental value of the modified warrants over the unmodified warrants on the modification date. Assumptions used in the Black Scholes option-pricing model for these warrants were as follows:

Average risk-free interest rate	0.15	%
Average expected life-years	1.5
Expected volatility	238.97	%
Expected dividends	0	%

	Number of Warrants		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)
Outstanding at December 31, 2021		6,909,000	$	0.15		1.18
Granted		—		—		—
Extended		—		—		—
Exercised		—		—		—
Forfeited/expired		—		—		—
Outstanding at December 31, 2022		6,909,000	$	0.15		0.18
Exercisable at December 31, 2022		6,909,000	$	0.15		0.18

As of December 31, 2022 and 2021, the average remaining contractual life of the outstanding warrants was 0.18 years and 1.18 year, respectively. The warrants will expire on March 7, 2023.  (see Note 10 – Subsequent Events)

Series A 10% Convertible Preferred Stock

The Company has authorized 4,000,000 shares of Preferred Stock, of which 50,000 shares have been designated as Series A 10% Convertible Preferred Stock. As of December 31, 2022 and 2021, there was no preferred stock issued or outstanding.