Stockholders' Equity (Deficit)

9 Months Ended

Sep. 30, 2019

Equity [Abstract]

Stockholders' Equity (Deficit)

Note 8 – Stockholders’ Equity (Deficit)

The Company’s authorized capital stock consists of 100,000,000 shares, of which 80,000,000 are for shares of common stock, par value $0.0001 per share, and 20,000,000 are for shares of preferred stock, par value $0.0001 per share, of which 50,000 have been designated as Series A Cumulative Convertible Preferred Stock (“Series A”). As of September 30, 2019 and December 31, 2018, there were 5,768,956 shares of preferred stock issued and outstanding and 0 shares of Series A, respectively.

As of September 30, 2019 and December 31, 2018, there were 70,135,036 and 70,135,036 shares of common stock issued and outstanding, respectively. Each share of the common stock entitles its holder to one vote on each matter submitted to the shareholders.

Stock Options

The following is a summary of the Company’s option activity:

	Options			Weighted Average Exercise Price
Outstanding – December 31, 2018		4,345,000		$	0.52
Exercisable – December 31, 2018		3,492,500		$	0.59
Granted		2,142,500		$	0.13
Exercised		-		$	-
Forfeited/Cancelled		(1,620,000	)	$	-
Outstanding – September 30, 2019		4,867,500		$	0.31
Exercisable – September 30, 2019		3,753,333		$	0.35

Options Outstanding							Options Exercisable
Exercise Price		Number Outstanding		Weighted Average Remaining Contractual Life (in years)	Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price
$	0.13 – 0.94		4,867,500	3.22 years	$	0.31		3,753,333	$	0.35

At September 30, 2019, the total intrinsic value of options outstanding and exercisable was $0.

On January 23, 2019, the Company granted options to employees and consultants to purchase 1,442,500 shares of the Company’s common stock. The options were with an exercise price of $0.13 per share, a term of 5 years, and 2-year vesting. The warrants have an aggregated fair value of approximately $167,440 that was calculated using the Black-Scholes option-pricing model based on the assumptions below.

	September 30, 2019
Risk-free interest rate		2.58	%
Expected life of grants		3.5 years
Expected volatility of underlying stock		169.88	%
Dividends		0	%

The estimated option life was determined based on the “simplified method,” giving consideration to the overall vesting period and the contractual terms of the award.

During the nine months ended September 30, 2019, the Company recorded total stock-based compensation expense related to options of approximately $243,100. The unrecognized compensation expense at September 30, 2019 was approximately $123,900.

Stock Warrants

The following is a summary of the Company’s warrant activity:

	Warrants		Weighted Average Exercise Price
Outstanding – January 1, 2018		16,666,667	$	0.15
Exercisable – January 1, 2018		16,666,667	$	0.15
Granted		-	$	-
Exercised		-	$	-
Forfeited/Cancelled		-	$	-
Outstanding – December 31, 2018		16,666,667	$	0.15
Exercisable – December 31, 2018		16,666,667	$	0.15
Granted		-	$	-
Exercised		-	$	-
Forfeited/Cancelled		-	$	-
Outstanding – September 30, 2019		16,666,667	$	0.15
Exercisable – September 30, 2019		16,666,667	$	0.15

Warrants Outstanding							Warrants Exercisable
Exercise Price		Number Outstanding		Weighted Average Remaining Contractual Life (in years)	Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price
$	0.15		16,666,667	2.17 years	$	0.15		16,666,667	$	0.15

At September 30, 2019, the total intrinsic value of warrants outstanding and exercisable was $0.

There were no new warrants granted during the nine months or the year ended September 30, 2019 and December 31, 2018, respectively.