Note 7 - Stockholders' Equity |
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Notes to Financial Statements | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stockholders' Equity Note Disclosure [Text Block] |
Series B Preferred stock: Since July 1, 2014, the Company has 200 shares of Series B redeemable convertible Preferred stock outstanding with a par value of $0.01 per share, convertible at the option of the holder at $2.00 per share, with dividends accrued and payable at 2.5% per quarter. The Series B Preferred stock is mandatorily redeemable at $100 per share by the Company three years after issuance and accordingly was classified as a liability. The 200 shares have reached their maturity date, but due to the cash constraints of the Company have not been redeemed.During the years ended June 30, 2020 and 2019, the Company declared dividends of $2,000 and $2,000 respectively. At September 30, 2020, accrued dividends payable are $18,500. The dividends are classified as a component of operations as the Series B Preferred stock is presented as a liability in these financial statements.Common stock: Holders of common stock are entitled to one vote per share on all matters to be voted on by common stockholders. In the event of liquidation, dissolution or winding up of the Company, the holders of common stock are entitled to share in all assets remaining after liabilities have been paid in full or set aside and the rights of any outstanding preferred stock have been satisfied. Common stock has no preemptive, redemption or conversion rights. The rights of holders of common stock are subject to, and may be adversely affected by, the rights of the holders of any outstanding series of preferred stock or any series of preferred stock the Company may designate in the future.Centerpoint holds 704,309 shares of the Company's common stock. These shares of the Company's common stock held by Centerpoint are for the benefit of its shareholders without any beneficial interest.During the three months ended September 30, 2020, the Company entered into subscription agreements to sell units for $0.50 per unit, with each unit consisting of one share of the Company's restricted common stock and one warrant to purchase one share of the Company's restricted common stock for $0.75 per share with an expiry date of December 31, 2021, and pursuant thereto, the Company issued 50,000 units for total proceeds of $25,000, net proceeds of $22,500 after commissions of $2,500. The Company allocated the proceeds from the 50,000 shares and the 50,000 warrants based upon their relative fair values, using the share price on the day each of the subscription agreements were entered into and the fair value of the warrants, which was determined to be $0.05 per warrant. As a result, $1,190 was allocated to the warrants and $23,810 was allocated to the shares, and both were recorded as additional paid in capital.During the three months ended September 30, 2020, Smith elected to convert deferred compensation and accounts payable of $37,961and $20,364, respectively, into an aggregate 116,651 units at $0.50 per unit, with each unit consisting of one share of the Company's restricted common stock and one warrant to purchase one share of the Company's restricted common stock for $0.75 per share until December 31, 2021. Warrants: As of September 30, 2020, the Company had approximately 20.6 million warrants outstanding, with exercise prices from $0.60 to $2.00 and expiring on various dates through June 30, 2025. The weighted-average exercise price for the outstanding warrants is $0.73, and the weighted-average remaining contractual life as of September 30, 2020 is 3.3 years.During the three months ended September 30, 2020, the Company entered into subscription agreements to sell units for $0.50 per unit, with each unit consisting of one share of the Company's restricted common stock and one warrant to purchase one share of the Company's restricted common stock for $0.75 per share with an expiry date of December 31, 2021, and pursuant thereto, the Company issued 50,000 units for total proceeds of $25,000, net proceeds of $22,500 after commissions of $2,500. The Company allocated the proceeds from the 50,000 shares and the 50,000 warrants based upon their relative fair values, using the share price on the day each of the subscription agreements were entered into and the fair value of the warrants, which was determined to be $0.05 per warrant. As a result, $1,190 was allocated to the warrants and $23,810 was allocated to the shares, and both were recorded as additional paid in capital.During the three months ended September 30, 2020, the Company issued 50,000 warrants to a consultant to purchase 50,000 shares of the Company's restricted common stock at an exercise price of $0.90 per share and an expiration date of December 31, 2021. The warrants were in exchange for services expensed at $2,500. During the three months ended September 30, 2020, Smith elected to convert deferred compensation and accounts payable of $37,961and $20,364, respectively, into an aggregate 116,651 units at $0.50 per unit, with each unit consisting of one share of the Company's restricted common stock and one warrant to purchase one share of the Company's restricted common stock for $0.75 per share until December 31, 2021. During the three months ended September 30, 2020, the Company modified the expiration dates of 96,996 warrants issued to a broker as commissions to purchase 96,996 shares of the Company's common stock at an exercise price of $0.75 per share and an expiration of December 31, 2020. As the modification was both a reduction and addition to additional paid-in capital there was no impact to the financial statements.Stock options: The Company's 2006 Consolidated Incentive Plan, as amended during the three months ended September 30, 2020 ( the “2006 Plan”), provides for the issuance of options (and/or other securities) to purchase up to 36,000,000 shares of the Company's common stock. Terms of exercise and expiration of options/securities granted under the 2006 Plan may be established at the discretion of the Board of Directors, but no option may be exercisable for more than ten years.The Company recorded compensation expense related to employee stock options of nil three months ended September 30, 2020 and 2019, respectively. The Company granted nil three months ended September 30, 2020 and 2019, respectively.A summary of option activity under the 2006 Plan for the three months ended September 30, 2020 is as follows:
The following table presents information relating to nonvested stock options as of September 30, 2020:
The total fair value of stock options that vested during the three months ended September 30, 2020 and 2019 was nil and nil, respectively. As of September 30, 2020, the Company had no unrecognized compensation cost related to stock options. |