STOCKHOLDERS’ EQUITY

6 Months Ended

Jun. 30, 2023

Equity [Abstract]

STOCKHOLDERS’ EQUITY

NOTE 13 – STOCKHOLDERS’ EQUITY

As further described in Note 3 – Business Combination, under applicable accounting principles, the historical financial results of Titan prior to May 19, 2023 has replaced the historical financial statements of TraQiQ for the period prior to May 19, 2023. Titan’s equity structure, prior to the combination with the TraQiQ, was a limited liability company, resulting in all components of equity attributable to the members being reported within Member’s Equity.

As of June 30, 2023 and December 31, 2022, the Company was authorized to issue a total of 10,000,000 shares of its Preferred Stock in one or more series.

Members’ Equity

As of December 31, 2022, Titan had members’ equity of $2,526,104. Each Member had voting rights based on and proportionate to such Member’s Membership interest.

On February 1, 2023, in exchange for the settlement of the $170,000 WTI promissory note, a 2.254% membership interest in Titan was granted to the seller of WTI (Note 9 – Notes Payable).

Series A Preferred Stock

As of June 30, 2023, there were no Series A Convertible Preferred shares issued and outstanding.

Series B Preferred Stock

As of June 30, 2023, there were 1,470,135 shares of Series B Preferred Stock issued and outstanding, respectively. Subsequent to June 30, 2023, all outstanding shares of the Company’s Series B Preferred Stock were exchanged for the Company’s Series A Rights (Note 16 – Subsequent Events).

Each outstanding share of Series B Convertible Preferred Stock was convertible into the 100 shares of the Company’s common stock at any time commencing after the issuance date. Series B Convertible Stock had no voting rights. Upon any liquidation, dissolution, or winding-up of the Company, whether voluntary or involuntary (a “Liquidation”), the Series B Holders were entitled to receive out of the assets of the Company, whether capital or surplus, the same amount that a holder of Common Stock would receive if the Series B Preferred were fully converted. Except for stock dividends or distributions for, Series B Holders were entitled to receive, and the Company was required to pay, dividends on shares of Series B Preferred equal (on an as-if-converted-to-Common-Stock basis) to and in the same form as dividends actually paid on shares of the Common Stock when, as, and if such dividends are paid on shares of the Common Stock. No other dividends were required to be paid on shares of Series B Preferred.

Series C Preferred Stock

As of June 30, 2023, there were 701,000 shares of Series C Preferred Stock issued and outstanding, respectively.

Each outstanding share of Series C Convertible Preferred Stock has a par value of $0.0001 and is convertible into 100 shares of the Company’s common stock at any time commencing after the issuance date. The Series C Convertible Stock has voting rights equivalent to the voting rights of the common stock the holder would receive upon conversion. Upon any liquidation, dissolution, or winding-up of the Company, whether voluntary or involuntary (a “Liquidation”), the Series C Holders shall be entitled to receive on a pro-rata basis, the first $1,000 out of the assets of the Company, whether capital or surplus, before any distribution of such assets is made or set aside for the holders of the of common stock and any other stock of the Company ranking junior to the Series C Preferred Stock. Upon any Liquidation, the Series C Holders shall be entitled to receive out of the assets of the Company, whether capital or surplus, the same amount that a holder of common stock would receive if the Series C Preferred were fully converted. Except for stock dividends or distributions for, Series C Holders are entitled to receive, and the Company shall pay, dividends on shares of Series C Preferred equal (on an as-if-converted-to-Common-stock basis) to and in the same form as dividends actually paid on shares of the common stock when, as, and if such dividends are paid on shares of the common stock. No other dividends shall be paid on shares of Series C Preferred.

On May 19, 2023, pursuant to the terms of the Titan Merger Agreement, the Company completed the Titan Merger. Under the terms of the Titan Merger Agreement, the Company agreed to pay the Titan owners 630,900 shares of the Company’s Series C Preferred Stock as consideration. The Company accounted for the Titan Merger as a reverse acquisition using acquisition accounting. Because the Titan Merger qualifies as a reverse acquisition and given that Titan was a private company at the time of the Titan Merger and therefore its value was not readily determinable, the fair value of the merger consideration was deemed to be equal to quoted market capitalization of the Company at the acquisition date (Note 3 – Business Combinations).

Concurrent to the Titan Merger, the Company’s chief executive officer and one of the Company’s directors resigned from their respective positions and a new chief executive officer, chief operating officer and chief financial officer were appointed. The Company agreed to issue stock compensation in the form of 70,100 shares of the Company’s Series C Preferred Stock to the new chief executive officer (Note 14 – Stock-Based Compensation). Subsequent to June 30, 2023, the Company and the chief executive officer signed a cancellation agreement and the Series C Preferred Stock shares were rescinded (Note 16 – Subsequent Events).

Common Stock

As of June 30, 2023 and the Company had 34,252,778 shares issued and outstanding, respectively. As of June 30, 2023, there were 300,000,000 shares of common stock authorized.

Under the terms of the Company’s articles of incorporation, holders of common stock are entitled to one vote for each share held on all matters submitted to a vote of stockholders, including the election of directors, and do not have cumulative voting rights. The holders of outstanding shares of common stock are entitled to receive dividends out of assets or funds legally available for the payment of dividends at such times and in such amounts as the Company’s board of directors from time to time may determine. The common stock is not entitled to pre-emptive rights and is not subject to conversion or redemption. Upon liquidation, dissolution or winding up of the Company, the assets legally available for distribution to stockholders are distributable ratably among the holders of common stock after payment of liquidation preferences, if any, on any outstanding payment of other claims of creditors. The rights, preferences and privileges of holders of common stock are subject to and may be adversely affected by the rights of the holders of shares of outstanding preferred stock and any series of preferred stock the Company may designate and issue in the future.

Subsequent to June 30, 2023, the Company issued 300,000 shares of common stock due to vested restricted stock awards (Note 16 – Subsequent Events).

Warrants

The following schedule summarizes the changes in the Company’s common stock warrants:

					Weighted				Weighted
	Warrants Outstanding				Average				Average
	Number		Exercise		Remaining		Aggregate		Exercise
	Of		Price		Contractual		Intrinsic		Price
	Shares		Per Share		Life		Value		Per Share
Balance at December 31, 2022		-	$	-		-	$	-	$	-
Warrants acquired concurrent with the Titan Merger		108,734		0.008 – 16.00		.78		57,296		8.31
Warrants granted		-	$	-		-	$	-	$	-
Warrants exercised		-	$	-		-	$	-	$	-
Warrants expired/cancelled		-	$	-		-	$	-	$	-
Balance at June 30, 2023		108,734	$	0.008 – 16.00		0.78	$	57,296	$	8.31
Exercisable at June 30, 2023		106,907	$	0.008 – 16.00		0.88	$	54,389	$	9.45
Balance at December 31, 2021		-	$	-		-	$	-	$	-
Warrants granted		-	$	-		-	$	-	$	-
Warrants exercised/exchanged		-	$	-		-	$	-	$	-
Warrants expired/cancelled		-	$	-		-	$	-	$	-
Balance at June 30, 2022		-	$	-		-	$	-	$	-
Exercisable at June 30, 2022		-	$	-		-	$	-	$	-