Stockholder's Equity

3 Months Ended

Mar. 31, 2021

Equity [Abstract]

STOCKHOLDER'S EQUITY

NOTE 9 – STOCKHOLDER’S EQUITY

Common Stock

During the quarter ended March 31, 2021, shares of common stock were issued as a result of the following non-cash transactions:

● Convertible notes totaling $120,000 and a portion of their accrued interest at the option of the noteholders were converted into approximately 989,000 shares of common stock of the Company.

● Certain warrant and stock option holders exercised their respective warrants and stock options by means of the cashless exercise feature and were issued approximately 13,226,000 common shares of the Company.

During the quarter ended March 31, 2020, shares of common stock were issued as a result of the following transactions:

● The Company granted 4,500,000 shares of Restricted Common Stock of which 3,000,000 shares were granted to two new members of our Board of Directors in connection with their compensation for service as Board Members and 1,500,000 shares to an employee in connection with his employment compensation. The shares were valued at the fair market value at the date of grant. The restricted stock vests upon the achievement of certain performance criteria.

● The Company issued approximately 106,000 shares of common stock to a third-party provider of services in lieu of cash compensation.

Warrants

The following is a summary of the Company’s warrant activity for the three months ended March 31, 2021:

	Number of Shares			Weighted Average Exercise Price		Weighted Average Remaining Life
Outstanding at December 31, 2020		54,697,021		$	0.14		3.4 Years
Exercised/cancelled		(12,357,786	)		0.10		-
Outstanding at March 31, 2021		42,339,235		$	0.15		4.0 Years

Stock Options

The Company did not grant any stock options in the first quarter of 2021.

Activity related to stock options for the three months ended March 31, 2021 is summarized as follows:

				Weighted Average		Weighted Average		Aggregate
	Number of			Exercise		Contractual		Intrinsic
	Shares			Price		Term (Yrs.)		Value
Outstanding as of December 31, 2020		169,374,061		$	0.15		7.5	$	8,283,639
Granted		-			-		-		-
Exercised/cancelled		(7,068,667	)		0.05
Outstanding as of March 31, 2021		162,305,394			0.15		7.2	$	29,442,247
Exercisable as of March 31, 2021		123,108,727		$	0.18		6.7	$	20,362,319

The following table summarizes stock option information as of March 31, 2021:

Exercise Price		Outstanding		Weighted Average Contractual Life (Yrs).		Exercisable
$	0.0001		3,500,000		5.3		3,500,000
	0.05		26,700,006		6.2		23,950,006
	0.06		1,042,054		9.2		1,042,054
	0.07		50,000,000		9.2		26,000,000
	0.09		11,630,000		9.5		-
	0.10		27,200,000		6.3		27,200,000
	0.12		933,334		8.5		616,667
	0.13		250,000		7.4		250,000
	0.15		2,800,000		5.4		2,800,000
	0.22		2,583,333		7.6		2,083,333
	0.25		2,500,000		7.4		2,500,000
	0.26		166,667		7.9		166,667
	0.29		1,000,000		6.9		1,000,000
	0.40		1,000,000		5.7		1,000,000
	0.45		31,000,000		5.4		31,000,000
			162,305,394		7.2		123,108,727

During the three months ended March 31, 2021, the Company recognized approximately $614,000 of stock option based compensation expense of which approximately $452,000 relates to performance-based awards of director/officers. As of March 31, 2021, there was approximately $1,154,000 of unrecognized compensation costs related to stock options outstanding that will be expensed through 2023. Additionally, the Company recorded approximately $13,000 for restricted stock expense.

At the Annual Meeting of Stockholders held on March 22, 2021, the stockholders approved and ratified an increase of 75,000,000 shares of common stock allocated to the Company’s 2017 Incentive Stock Plan.

Subsequent event

On May 5, 2021, the Company granted options to acquire shares of common stock (“Stock Options”) at an exercise price equivalent to fair market value on the date of grant with an exercise period of ten years, as follows:

● 17,500,000 Stock Options to each of Mr. Kumnick and Mr. Broenniman subject to tranche vesting upon achieving certain corporate performance measures.

● 11,500,000 Stock Options to certain officers and employees that vest over a three-year period, subject to continued service.

● Approximately 2,700,000 fully vested Stock Options for present and former non-employees Directors compensation for services from 2019 through April 30, 2021.

● Approximately 1,300,000 Stock Options to two present non-employee Director that vest over a twelve-month period.

See Note 5 for additional information regarding accrued Directors’ compensation.