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SUMMARY OF STOCK OPTIONS AND WARRANTS
12 Months Ended
Dec. 31, 2022
Share-Based Payment Arrangement [Abstract]  
SUMMARY OF STOCK OPTIONS AND WARRANTS

NOTE 5 – SUMMARY OF STOCK OPTIONS AND WARRANTS

 

On July 21, 2017, the Company’s board of directors adopted The Crypto Company 2017 Equity Incentive Plan (the “Plan”), which was approved by its stockholders on August 24, 2017. The Plan is administered by the board of directors (the “Administrator”). Under the Plan, the Company may grant equity awards to eligible participants which may take the form of stock options (both incentive stock options and non-qualified stock options) and restricted stock awards. Awards may be granted to officers, employees, non-employee directors (as defined in the Plan) and other key persons (including consultants and prospective employees). The term of any stock option award may not exceed 10 years and may be subject to vesting conditions, as determined by the Administrator. Options granted generally vest over eighteen to thirty-six months. Incentive stock options may be granted only to employees of the Company or any subsidiary that is a “subsidiary corporation” within the meaning of Section 424(f) of the Internal Revenue Code.

 

During the year ended December 31, 2020, the Company issued 500,000 stock options to members of its board of directors, 1,250,000 stock options to employees, and 170,000 stock options to non-employees. No stock options were issued in 2021.

 

5,000,000 shares of the Company’s common stock are reserved for issuance under the Plan. As of December 31, 2021, there are outstanding stock option awards issued from the Plan covering a total of 2,281,349 shares of the Company’s common stock and there remain reserved for future awards 2,718,651 shares of the Company’s common stock.

 

      Weighted
         Average
      Weighted  Remaining
      Average  Contractual
   Number  Exercise  Term
   of Shares  Price  (years)
          
Options outstanding, at December 31, 2020   2,281,349   $2.26    -  
Options granted   -            
Options cancelled   -            
Options exercised   -            
Options outstanding, at December 31, 2021   2,281,349   $2.26    4.25 
Options granted   -         
Options cancelled   -           
Options exercised   -           
Options vested and outstanding, at December 31, 2022   2,281,349   $2.26    3.25 

 

The Company recognized $-0- and $-0- of compensation expense related to stock options for the years ended December 31, 2022 and 2021, respectively. As of December 31, 2022 these options had no intrinsic value since they were all out of the money as of December 31, 2022.

 

The determination of the fair value of share-based compensation awards utilizing the Black-Scholes model is affected by the Company’s stock price and a number of complex and subjective assumptions, including stock price, volatility, expected life of the equity award, forfeitures rates if any, risk-free interest rates and expected dividends. Volatility is based on the historical volatility of comparable companies measured over the most recent period, generally commensurate with the expected life of the Company’s stock options, adjusted for future expectations given the Company’s limited historical share price data.

 

The risk-free rate is based on implied yields in effect at the time of the grant on U.S. Treasury zero-coupon bonds with remaining terms equal to the expected term of the stock options. The expected dividend is based on the Company’s history and expectation of dividend pay-outs. Forfeitures are recognized when they occur.

 

The range of assumptions used for the year ended December 31, 2022 was as follows:

 

Schedule Of Stock Option Assumptions

 

   Year ended
December 31, 2022
Ranges
Volatility   102%
Expected dividends   0%
Expected term (in years)   510 years 
Risk-free rate   0.40 %

 

The Company recognized $2,086,151 and $715,215 of compensation expense related to restricted stock awards for the years ended December 31, 2022 and 2021, respectively. The $2,086,151 dollar expense represented the issuance of 748,146 shares for services which were valued at approximately $1.50 per share based on the Company’s stock trading price on the OTC market on the date of issuance.

 

As of December 31, 2022 the Company had 2,009,167 warrants outstanding comprised of the following:

 

  50,000 warrants exercisable at a strike price of $0.01 expiring at various times between February and June 2030
  362,500 warrants exercisable at a strike price of $0.50 expiring in February 2026
  1,596,667 warrants exercisable at a strike price of $5.25 expiring at between January and May 2025.