Stockholders’ Equity

3 Months Ended

Apr. 30, 2023

Equity [Abstract]

Stockholders’ Equity

Note 8 - Stockholders’ Equity

Preferred Stock and Series A Preferred Stock

The Company is authorized to issue 20,000,000 shares of preferred stock, $0.00001 par value per share. The Company has designated 120,000 shares of preferred stock as Series A Convertible Preferred stock. As of April 30, 2023 and January 31, 2023, no shares of Series A Convertible Preferred Stock are issued and outstanding. The Company has designated 200,000 shares of preferred stock, $0.00001 par value per share, for each of the Series B Preferred. As of April 30, 2023 and January 31, 2023, 54,600 shares of Series B Preferred Stock are issued and outstanding

Series B Preferred

The holders of the Series B Preferred Stock shall be entitled to receive, upon liquidation, dissolution or winding up of the Company, the amount of cash, securities or other property to which such holder would be entitled to receive with respect to such shares of Series B Preferred Stock if such shares had been converted to common stock immediately prior to such liquidation.

Holders of the Series B Preferred Stock are entitled to receive cumulative cash dividends at an annual rate of eight percent (8%). Holders of the Series B Preferred Stock shall have no voting rights. Each share of Series B Preferred Stock shall be convertible, at the option of the holder, into shares of common stock at a rate of 1 share of Series B Preferred Stock into 15 shares of common stock. The Company can force conversion at $2.00 per share of Common Stock at any time after six (6) months after issue if the Common Stock has a closing price of $2.00 or higher in any 20 consecutive trading days. After 18 months, the Company can force holders to convert at a 20% discount to the most recent 20-day average closing price per share. The Company also has the right to cause a conversion following a Fundamental Change.

During the three months ended April 30, 2023, the Company paid dividends of $27,300.

Restricted Stock Units

During the three months ended April 30, 2023, the Company awarded 39,773 restricted stock units (“RSUs”) to certain employees with an aggregate grant date fair value of $70,000. The RSUs will be expensed over the requisite service period. The terms of the RSUs include vesting provisions based solely on continued service. If the service criteria is satisified, the RSUs will vest in equal installments during April 2024, April 2025, and April 2026.

The following is a summary of the Company’s restricted stock units activity:

	Restricted Stock Units		Weighted Average Exercise Price
Unvested – February 1, 2023		367,647	$	1.36
Granted		39,773	$	1.76
Vested		-	$	-
Forfeited		-	$	-
Outstanding – April 30, 2023		407,420	$	1.40

During the three months ended April 30, 2023, the Company recognized stock-based compensation related to restricted stock units of an aggregate of $32,529, which was recorded to general and administrative expense on the condensed statement of operations, and there was unrecognized stock-based compensation of $487,043 as of April 30, 2023 related to future vesting of restricted stock units.

For the three months ended April 30, 2022 the Company recognized stock-based compensation related to restricted stock units of an aggregate of $0.

Options

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

	Options			Weighted Average Exercise Price
Outstanding – February 1, 2023		689,000		$	0.77
Exercisable – February 1, 2023		539,000		$	0.57
Granted		-		$	-
Exercised		(200,000	)	$	0.39
Outstanding – April 30, 2023		489,000		$	0.93
Exercisable – April 30, 2023		339,000		$	0.68

		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
$	0.52 – 1.48	489,000		2.95	$	0.93	339,000	$	0.68

At January 31, 2023, the total intrinsic value of options outstanding and exercisable was $544,760 and $704,450, respectively.

During the three months ended January 31, 2023, there were 200,000 options exercised at a weighted average exercise price of $0.39 per share and resulted in the issuance of 166,920 shares of common stock. The Company received $19,500 for the exercise of these options, as a portion of the options were cashless exercised.

For the three months ended April 30, 2023 and 2022, the Company recognized stock-based compensation related to options of an aggregate of $22,855 and $0, respectively, which is included in general and administrative expenses on the accompanying consolidated statements of operations. At April 30, 2023, there was unrecognized stock-based compensation of $97,634.

Warrants

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

	Warrants		Weighted Average Exercise Price
Outstanding – February 1, 2023		13,650	$	2.25
Exercisable – February 1, 2023		13,650	$	2.25
Granted		-	$	-
Exercised		-	$	-
Outstanding –April 30, 2023		13,650	$	2.25
Exercisable – April 30, 2023		13,650	$	2.25

		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
$	2.25	13,650		4.37	$	2.25	13,650	$	2.25

At April 30, 2023, the total intrinsic value of warrants outstanding and exercisable was $0.