Stock Options and Warrants

3 Months Ended

Mar. 31, 2025

Share-Based Payment Arrangement [Abstract]

Stock Options and Warrants

8. Stock Options and Warrants

The Company periodically issues stock options and warrants to employees and non-employees in capital raising transactions, for services, and for financing costs.

Stock Options

Stock options vest according to the terms of the specific grant and expire from 2 to 10 years from date of grant. The weighted-average, remaining contractual life of employee and non-employee options outstanding at March 31, 2025 was 7.6 years. Stock option activity for the period January 1, 2025 up to March 31, 2025, was as follows:

	Options			Weighted Avg. Exercise Price
January 1, 2025		25,294,103		$	0.13
Granted (including 43,300,138 options granted to related parties)		52,850,138			0.04
Exercised		(40,000	)		0.05
Expired		(738,552	)		0.48
March 31, 2025		77,365,689		$	0.07

The weighted average exercise prices, remaining contractual lives for options granted, exercisable, and expected to vest as of March 31, 2025 were as follows:

	Outstanding Options					Exercisable Options
Option Exercise Price Per Share	Shares		Life (Years)	Weighted Average Exercise Price		Shares		Weighted Average Exercise Price
$0.02 - $0.24		74,865,689	7.8	$	0.06		74,032,356	$	0.06
$0.25 - $0.49		2,500,000	2.0	$	0.33		2,500,000	$	0.33
		77,365,689	7.6	$	0.07		76,532,356	$	0.07

In the three-month period ending March 31, 2025, the Company issued options to purchase 17,482,638 shares of common stock to members of the Board of Directors, including 7,218,750 options issued to the Company’s CEO/CFO (see Note 9), upon reinstatement of the Director Compensation Policy. 7,656,250 options are exercisable at $0.02 per share, 4,375,000 options are exercisable at $0.04 per share, 2,430,555 options are exercisable at $0.06 per share, 2,187,500 options are exercisable at $0.08 per share, and 833,333 options are exercisable at $0.15 per share. 16,649,305 of the options were fully vested at the date of grant and 833,333 of the options vest over one year. Total fair value of these options at grant date was $2,571,000 using the Black-Scholes Option Pricing model with the following assumptions: expected life of 5 to 6 years; risk free interest rate of 3.95% to 4.47%; volatility of 179% and dividend yield of 0%. During the three-month period ended March 31, 2025, the Company recognized compensation costs based on the fair value of options that vested of $2,481,000.

In the three-month period ending March 31, 2025, the Company issued options to purchase 24,317,500 shares of common stock upon execution of an employment agreement with Cecil Bond Kyte, the Company’s CEO and CFO (see Note 9). The options are exercisable at a price of $0.03, fully vested at the date of grant, and expire 10 years from the date of grant. Total fair value of these options at grant date was $3,574,000 using the Black-Scholes Option Pricing model with the following assumptions: expected life of 5 years; risk free interest rate of 4.57%; volatility of 179% and dividend yield of 0%. During the three-month period ended March 31, 2025, the Company recognized compensation costs based on the fair value of options that vested of $3,574,000.

In the three-month period ending March 31, 2025, the Company issued options to purchase 1,500,000 shares of common stock to its corporate secretary as compensation. The options are exercisable at a price of $0.03, one third vested at the date of grant, and the balance will vest two years from the date of grant, and expire 10 years from the date of grant. Total fair value of these options at grant date was $238,000 using the Black-Scholes Option Pricing model with the following assumptions: expected life of 6 years; risk free interest rate of 4.32%; volatility of 179% and dividend yield of 0%. During the three-month period ended March 31, 2025, the Company recognized compensation costs based on the fair value of options that vested of $79,000.

In the three-month period ending March 31, 2025, the Company issued options to purchase 9,550,000 shares of common stock in exchange for services. The options are exercisable at a price of $0.03, one third vested at the date of grant, and the balance will vest two years from the date of grant, and expire 10 years from the date of grant. Total fair value of these options at grant date was $1,513,000 using the Black-Scholes Option Pricing model with the following assumptions: life of 10 years; risk free interest rate of 4.32%; volatility of 179% and dividend yield of 0%. During the three-month period ended March 31, 2025, the Company recognized compensation costs based on the fair value of options that vested of $504,000.

As of March 31, 2025, the market price of the Company’s stock was $0.25 per share. At March 31, 2025, the aggregate intrinsic value of the options outstanding at March 31, 2025 was $14,298,000.

Warrants

The following table summarizes certain information about the Company’s stock purchase warrants activity for the period starting January 1, 2025 up to March 31, 2025.

	Warrants			Weighted Avg. Exercise Price
January 1, 2025		44,044,009		$	0.04
Granted		18,327,240			0.10
Exercised		(4,701,397	)		0.06
Expired		(33,333	)		0.13
March 31, 2025		57,636,519		$	0.06

The weighted average exercise prices, remaining contractual lives for warrants granted, exercisable, and expected to vest as of March 31, 2025 were as follows:

	Outstanding Warrants				Exercisable Warrants
Warrant Exercise Price Per Share	Shares	Life (Years)		Weighted Average Exercise Price	Shares		Weighted Average Exercise Price
$0.02 - $0.24	57,636,519	1.0	$	0.06	57,603,186	$	0.06
	57,636,519	1.0	$	0.06	57,603,186	$	0.06

In the three-month period ending March 31, 2025, the Company issued warrants to purchase 99,999 shares of common stock in exchange for services. The warrants are exercisable at a price of $0.14 to $0.16, vest one month from the date of grant, and expire two years from the date of grant. Total fair value of these warrants at grant date was $11,000 using the Black-Scholes Option Pricing model with the following assumptions: life of 2 years; risk free interest rate of 3.94% to 4.29%; volatility of 154% to 158% and dividend yield of 0%. During the three-month period ended March 31, 2025, the Company recognized compensation costs based on the fair value of warrants that vested of $10,000.

At March 31, 2025, the market price of the Company’s common stock was $0.25 per share. At March 31, 2025, the aggregate intrinsic value of warrants outstanding was $10,958,000.