STOCK-BASED COMPENSATION

12 Months Ended

Dec. 31, 2024

Share-Based Payment Arrangement [Abstract]

STOCK-BASED COMPENSATION

NOTE 15 – STOCK-BASED COMPENSATION

The TraQiQ Inc. 2020 Equity Incentive Plan was initially approved by the Company’s Board of Directors on November 23, 2020. In conjunction with the reincorporation (Note 20 – Subsequent Events) and effective January 10, 2024, the Company adopted the Titan Environmental Solutions Inc. 2023 Equity Incentive Plan (the “2023 Plan”). The 2023 Plan limits the shares of common stock authorized to be awarded as stock awards to 32,500,000 shares. The 2023 Plan terminates upon the earlier of 1) the earliest date at which all shares awarded under the plan have been satisfied in full or terminated and there remain no new shares authorized to be issued under the plan, or 2) the tenth anniversary of the plan’s effective date.

Restricted Stock Awards

The activity for restricted stock awards under the Company’s incentive plans was as follows for the years ended December 31, 2024 and 2023:

						Weighted
				Weighted		Average
				Average		Remaining
	Number			Grant Date		Contractual
	Shares			Fair Value		Term (years)
Nonvested at December 31, 2023		-		$	-		-
Granted		-		$	-		-
Shares vested		-		$	-		-
Forfeitures		-		$	-		-
Nonvested at December 31, 2024		-		$	-		-
Nonvested at December 31, 2022		-		$	-		-
Granted		-		$	-		-
Acquired concurrent with the Titan Merger (vested and unreleased)		1,405,000		$	0.01		-
Acquired concurrent with the Titan Merger (unvested)		3,600,000		$	0.01		-
Shares vested		(300,000	)	$	0.01		-
Forfeitures and cancelations		(4,705,000	)	$	0.01		-
Total outstanding at December 31, 2023		-		$	-		-

As of June 30, 2023, there were 2,005,000 shares of common stock related to restricted stock grants that were vested and unissued. On September 13, 2023, the Company signed a Cancellation of Restricted Stock Grants Agreement with Sikka and two directors which rescinded and annulled 1,705,000 of the vested and unreleased shares and the 3,000,000 unvested shares. Consequently, the obligation to issue shares was eliminated.

Stock-based compensation from restricted stock awards for the years ended December 31, 2024 and 2023 was $0 and $5,590,485, respectively. As of December 31, 2024, there remained $0 of unrecognized stock-based compensation from restricted stock awards. The total fair value of restricted shares that vested during the years ended December 31, 2024 and 2023 was $0 and $3,510, respectively. The fair value of the vested and unreleased shares on the date of the Titan Merger was $16,439.

On the Titan Merger acquisition date, the Company awarded 70,100 shares of Series C Preferred Stock that vested immediately to its chief executive officer, and as a result recorded $5,586,796 of stock-based compensation (Note 14 – Stockholders’ Equity). On September 28, 2023, the Company and the chief executive officer signed a cancellation agreement and the Series C Preferred Stock shares were rescinded. Under the terms of the cancellation agreement, the Company agreed to issue ten-year stock options to acquire a number of shares of common stock of the Company in order to provide the chief executive officer an equity interest in the Company commensurate with the value of the original stock award. Such options will have an exercise price equal to the sale price of the common stock in the next public offering of common stock consummated by the Company.

The fair value of the Series C Preferred Stock was determined using observable inputs (level 2 fair value measurement) with a market approach technique. The main input for the Series C Preferred Stock fair value was the price of the Company’s common stock as of the date of the grant. As a result of the redomicile, each share of Series C Convertible Preferred Stock issued and outstanding immediately prior to the effective time of the redomicile was exchanged for one share of Series A Convertible Preferred Stock, which has substantially the same rights and preferences as the TraQiQ Series C Preferred Stock (Note 1 – Organization and Nature of Operations).

Stock Options

The activity for stock options under the Company’s incentive plans was as follows for the years ended December 31, 2024 and 2023:

	Number of Shares		Weighted Average Exercise Price		Weighted Average Remaining Life (Years)		Aggregate Intrinsic Value
Outstanding as of December 31, 2023		-	$	-		-		-
Granted		24,500,000		0.04		5.00		-
Cancelled or forfeited		-		-		-		-
Exercised		-		-		-		-
Outstanding as of December 31, 2024		24,500,000		0.04		5.00		-
Exercisable as of December 31, 2024		24,500,000	$	0.04		5.00		-

On December 31, 2024 the Company issued 24,500,000 stock options to management and members of the Board of Directors. The stock options vested immediately upon issuance, expire after a term of five years, and have an exercise price of $0.04. The Company recognized immediate stock compensation expense of $65,293. As of December 31, 2024 there was no unrecognized stock-compensation related to unvested stock options.

The Company recognizes stock-based compensation expense from stock options using the grant date fair-value. The fair value of options awarded is measured on the grant date using the Black-Scholes option-pricing model. The following assumptions were used as of December 31, 2024:

	For the Years Ended
	December 31,			December 31,
	2024			2023
Expected term (years)		2.50			N/A
Expected volatility		39.36	%		N/A
Expected dividend yield		0.00	%		N/A
Risk-free interest rate		4.38	%		N/A