Issuances of Securities

3 Months Ended

Mar. 31, 2025

Issuances of Securities

Issuances of Securities

Note 6. Issuances of Securities

Share issuances 2024

During the three months ended March 31, 2024, the Company had the following common stock transactions:

· 2,050,000 shares of common stock were sold for $391,225, net of legal and administrative fees of $4,200, under the Company’s common stock purchase agreement with White Lion.

Share issuances 2025

During the three months ended March 31, 2025, the Company did not have any common stock transactions other than those described under the restricted stock units section below.

White Lion Common Stock Purchase Agreement (CSPA)

On June 20, 2024, the Company and White Lion amended the CSPA (the “Second Amendment”) to provide that the purchase price to be paid by White Lion for shares of the Company’s common stock pursuant to the CSPA equals the lower of: (i) 93% of the volume-weighted average price of the Company’s common stock during a period of five consecutive trading days following the Company’s exercise of its right to sell shares (or 95% of that volume-weighted average price if the Company’s common stock is trading on a national exchange), or (ii) the closing price of the common stock on the day the Company exercises its right to sell shares, subject to a floor price of $0.25 per share. The Second Amendment further provides that if the Company issues a share price purchase notice at a time that the Company’s common stock is trading below the floor price and White Lion waives the floor price condition, the purchase price to be paid by White Lion for such shares shall equal 90% multiplied by the lower of the (i) three lowest volume-weighted average price of the Company’s common stock during a period of five consecutive trading days following the Company’s exercise of its right to sell shares, or (ii) most recent closing price of the Company’s common stock prior to White Lion’s receipt of a share price purchase notice.

On June 26, 2024, the Company filed a registration statement on Form S-1 to register for resale an additional 15,000,000 common shares related to CSPA. The Company's S-1 registration statement was declared effective by the SEC on July 29, 2024.   

 Restricted stock units

As of March 31, 2025 and December 31, 2024, the Company has 41,440,000 and 47,665,000 restricted stock units (RSU) outstanding, respectively. The RSU’s are subject to certain conditions and shall vest upon the achievement of certain Company objectives and milestones. 

During the three months ended March 31, 2025, the Company terminated the services of one of its consultants who had an RSU agreement in place. Per the RSU agreement, all of the unvested RSU’s owed to the consultant vested immediately upon termination of services. This resulted in 975,000 RSU’s vesting and $692,250 of stock-based compensation being recorded which was the fair value of the shares on the original grant date of the RSU agreement.

During the three months ended March 31, 2025, the Board of Directors approved an amendment to a consultant’s RSU agreement.  The amendment resulted in 3,750,000 of RSU’s vesting during the current period and the remaining 2,750,000 vesting upon achievement of certain Company objectives and milestones. Per ASC 718-20-35, the change in vesting conditions resulted in a modification of the stock-based compensation awards. The modification is considered a Type III modification as described in ASC 718-20-55 and resulted in recording $427,875 of stock-based compensation expense which was the fair value of the shares on the date of the modification.

Management is unable to predict if or when a Covered Transaction or Triggering Event under the RSU Agreements governing the restricted stock units will occur and as of March 31, 2025, there was $19,945,155 of unrecognized compensation cost related to unvested restricted stock unit awards.

Activity related to our restricted stock units during the three months ended March 31, 2025 was as follows:

				Weighted
				Average
				Grant
	Number of			Date Fair
	Units			Value
Total awards outstanding at December 31, 2024		46,165,000		$	0.55
Units granted		-		$	-
Units Exercised/Released		(4,725,000	)	$	0.24
Units Cancelled/Forfeited		-		$	-
Total awards outstanding at March 31, 2025		41,440,000		$	0.48

Warrants

During the year ended December 31, 2024, the Company issued 412,500 warrants related to the sale of 825,000 units.  The Company valued the common stock and warrants issued in the sale of the units using the relative fair value method.  The warrants have a value of $5,990 and was recorded in additional paid-in capital.

Activity related to our warrants during the three months ended March 31, 2025 was as follows:

	Number of Warrants		Weighted Average Exercise Price
Total warrants outstanding at December 31, 2024		412,500	$	0.14
Granted		-	$	-
Exercised		-	$	-
Cancelled/Forfeited		-	$	-
Total warrants outstanding at March 31, 2025		412,500	$	0.14

The fair value of each warrant on the date of grant is estimated using the Black-Scholes valuation model. The following weighted-average assumptions were used for the warrants granted during the year ended December 31, 2024:

	Year Ended
	December 31,
	2024
Exercise price	$	0.14
Expected term	1 year
Expected average volatility		90.88	%
Expected dividend yield		-
Risk-free interest rate		4.17	%

The following table summarizes information relating to outstanding and exercisable warrants as of March 31, 2025:

Warrants Outstanding						Warrants Exercisable
		Weighted Average
Number Warrants		Remaining Contractual		Weighted Average		Number		Weighted Average
		life (in years)		Exercise Price		of Shares		Exercise Price
	412,500		1.75	$	0.14		412,500	$	0.14