Shareholders’ Equity (Deficit)

6 Months Ended

Jun. 30, 2021

Equity [Abstract]

Shareholders’ Equity (Deficit)

6. Shareholders’ Equity (Deficit)

During the six months ended June 30, 2021 the Company issued a total of 1,502,409 (30,048,199 pre-stock split) common shares relating to the Reg-A public offering. Of the shares issued 15,500 (312,000 pre-stock split) common shares valued at $31,200 were from share subscription payable and 750 (15,000 pre-stock split) common shares were cancelled and refunded valued at $1,500. The Company incurred share issuance cost of $123,984.

During the same period 1,409,122 (28,182,451 pre-stock split) Reg-A public offering warrants were exercised for 1,409,122 (28,182,451 pre-stock split) common shares. As of June 30, 2021 1,311,394 (26,227,876 pre-stock split) common shares were issued valued at $5,245,592. Subsequent to June 30, 2021 the remaining 97,729 (1,954,575 pre-stock split) common shares valued at $390,915 were issued.

During the six months ended June 30, 2021 the Company raised $4,081,980 through private placement offerings for 2,040,990 (40,819,800 pre-stock split) common shares and warrants.

During the six months ended June 30, 2021 the Company entered into consulting agreements with third party consultants for 370,000 (7,400,000 pre-stock split) shares of common stock valued at $1,588,000 for consulting services. The services will be expensed throughout the term of the agreement as the Company accrues the stock payable. As of June 30, 2021 the Company recorded $337,145 in share subscriptions payable.

During the six months ended June 30, 2021 the Company issued 259,808 (5,196,154 pre-stock split) common shares valued at $741,159 for consulting services, $241,559 were issued from share subscriptions payable. During the same period the Company issued 150,000 (3,000,000 pre-stock split) common shares valued at $390,000 for consulting services. During the same period the Company issued 3,350 (67,000 pre-stock split) common shares for employee compensation valued at $24,121.

During the six months ended June 30, 2021 the Company entered into a loan settlement agreement with a loan holder to issue 62,006 (1,240,111 pre-stock split) common shares at $1.80 ($0.09 pre-stock split) per share for all outstanding loan principal and interest valued at $111,611. As of the date of the settlement the Company had $157,787 loan payable, resulting in the Company recognized a gain on settlement of $46,176. Refer to note 11. As of June 30, 2021 the Company issued 62,006 (1,240,111 pre-stock split) common shares.

During the six months ended June 30, 2021 the Company entered into a promissory notes payable settlement agreement with a note holder to issue 36,048 (720,996 pre-stock split) common shares valued at $1.80 ($0.09 pre-stock split) per share for a total value of $64,891. As of the date of the settlement the Company had $73,886 promissory notes payable, resulting in the Company recognized a gain on settlement of $8,997. Refer to note 4. As of June 30, 2021 the Company issued 36,048 (720,966 pre-stock split) common shares.

During the six months ended June 30, 2021 the Company entered into a settlement agreement with the convertible promissory note holder to settle all outstanding principal and interest. The Company issued 204,622 (4,092,431 pre-stock split) common shares at $1.80 ($0.09 pre-stock split) per share valued at $368,318. As of the date of the settlement the Company had $325,667 convertible promissory note, resulting in the Company recognized a loss of $42,651 on settlement of debt. During the same period the convertible promissory note holder exercised 39,512 (790,243 pre-stock split) warrants on a cashless basis for 39,512 (790,243 pre-stock split) common shares. Refer to note 5 and 14.

During the six months ended June 30, 2021 the Company issued 1,717,535 (34,350,697 pre-stock split) common shares to Steve Rossi, the Company’s Chief Executive Officer and Director, in connection with his Employment Agreement in consideration for Mr. Rossi agreeing to amend the Series A Certificate of Designation to eliminate the Series A Preferred Stock conversion rights and returning 900 Series A Preferred Stock to the Company.

During the six-months ended June 30, 2020 the Company issued 66,667 (1,333,333 pre-stock split) and 12,000 (240,000 pre-stock split) common shares at $1.80 ($0.09 pre-stock split) and $1.40 ($0.07 pre-stock split) per share for $120,000 and $16,800 respectively for prepaid advertising services. As of June 30, 2020 the Company has expensed $6,620 from prepaid expenses.

During the six-months ended June 30, 2020 the Company entered into a share subscription agreement with a consultant of the Company for 200,000 (4,000,000 pre-stock split) common shares valued at $125,000 for prepaid consulting services. As of June 30, 2020 the Company issued 107,500 (2,150,000 pre-stock split) shares with a value of $67,188. As of June 30, 2020 the Company has expensed $62,500 from prepaid expenses.

During the six-months ended June 30, 2020 the Company issued a consultant 200,000 (4,000,000 pre-stock split) common shares of subscription payable with a value of $456,000 relating to the anti-dilution feature triggered on March 5, 2019.

During the six-months ended June 30, 2020 the Company issued 22,942 (458,834 pre-stock split) common shares pursuant to a subscription payable with a value of $55,000.

During the six-months ended June 30, 2020 the Company issued 22,500 (450,000 pre-stock split) shares in connection with the issuance of convertible promissory note (note 5) at $5.40 ($0.27 pre-stock split) per share.

During the six-months ended June 30, 2020 the Company entered into a settlement to fulfill a debt purchase agreement entered in 2017 for 134,049 (2,680,981 pre-stock split) shares valued at $138,818. As of June 30, 2020 the Company has issued 109,548 (2,190,959 pre-stock split) shares.

Worksport Ltd.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

6. Shareholders’ Equity (Deficit) (continued)

During the six-months ended June 30, 2020, Steven Rossi (the Company’s CEO) was issued 1,000 Series A Preferred Shares at $0.09 per share equal to 299,000 common shares voting rights.

As of June 30, 2021, the Company was authorized to issue 299,000,000 shares of its common stock with a par value of $0.0001. All shares were ranked equally with regards to the Company’s residual assets. During 2021, the Company was authorized to issue 100 shares of its Series A and 100,000 Series B Preferred Stock with a par value of $0.0001. Series A preferred Stock have voting rights equal to 0 shares of common stock, per share of preferred stock. Series B preferred Stock have voting rights equal to 10,000 shares of common stock, per share of preferred stock.