CAPITAL STOCK

12 Months Ended

Dec. 31, 2021

Equity [Abstract]

CAPITAL STOCK

5. CAPITAL STOCK

Capitalization

The authorized capital of the Company is 500,000,000 shares of capital stock, divided into 480,000,000 shares of common stock with a par value of $0.001 per share, and 20,000,000 shares of preferred stock with a par value of $0.001 per share. The Company reserved 10,000,000 shares of common stock for issuance under its 2016 Omnibus Equity Incentive Plan. The Company has issued 50,634,536 common shares and no preferred shares. During the year ended December 31, 2021, the Company issued 28,571 shares of its common stock on the cashless exercise of 50,000 options.

1,000,000 shares of Series A Convertible Preferred Stock are to be issued to Sapir, as consideration for the Assets. Sapir has the right to convert each preferred share to 450 shares of common stock. Each preferred share votes as 450 shares per one share of common stock.

Options

A total of 9,950,000 options were issued and outstanding at December 31, 2021, all of which were vested.

On November 20, 2018, the Company granted 500,000 non-qualified stock options pursuant to its Equity Incentive Plan, to key outside consultants, with 50% vesting after one year and 50% vesting after two years. Each option is exercisable into one share of the Company’s common stock at a price of $0.06 per share, for a term of five years. The options had an estimated grant date fair value of $10,408. 50,000 of the options were exercised on March 4, 2021 on a cashless basis at a price of $0.06, resulting in the issuance of 28,571 common shares. The cash component, equivalent to $3,000, is calculated as 21,429 shares at $0.14, the closing market price of the Company on the date of issuance.

The 500,000 options were fully expensed by December 31, 2020. For the year ended December 31, 2021, $Nil (2020 - $3,535) was included in consulting services expense, based on fair value estimates determined using the Black-Scholes option pricing model with an average risk-free rate of 2.88%, a weighted average life of 5 years, volatility of 195.37%, and dividend yield of 0%. At December 31, 2021, the remaining 450,000 options had an intrinsic value of $15,750 (2020 - $40,000) based on the exercise price of $0.06 per option and a market price of $0.095 per share.

On February 14, 2017, the Company granted 9,500,000 non-qualified stock options pursuant to the Equity Incentive Plan, to key corporate officers and outside consultants, with 25% vesting immediately and a further 25% vesting every six months thereafter for eighteen months. Each option is exercisable into one share of the Company’s common stock at a price of $0.06 per share, equal to the closing price of the common stock on the grant date, for a term of five years. The options were fully amortized by the end of 2018. At December 31, 2021, the options had an intrinsic value of $332,500 (2020 - $760,000) based on the exercise price of $0.06 per option and a market price of $0.095 per share.

Summary of option activity in the current year and options outstanding (all fully vested) at December 31, 2021:

	Options Outstanding			Weighted Average Life Remaining (Years)		Intrinsic Value
Balance December 31, 2020 and 2019		10,000,000				$	800,000
Issued		-
Exercised		(50,000	)
Expired		-
Balance December 31, 2021		9,950,000			0.20	$	348,250

Warrants

During the year ended December 31, 2021, no warrants to purchase shares of common stock were issued, exercised, or expired. On November 19, 2020, 3,336,060 warrants issued in 2015 expired without being exercised, leaving no warrants outstanding and no intrinsic value at December 31, 2021 or 2020.