STOCKHOLDERS’ EQUITY

9 Months Ended

Sep. 30, 2024

Equity [Abstract]

STOCKHOLDERS’ EQUITY

NOTE 6 – STOCKHOLDERS’ EQUITY

The Company was formed with one class of common stock, $0.0001 par value, and is authorized to issue 100,000,000 common shares and one class of preferred stock, $0.0001 par value, and is authorized to issue 10,000,000 preferred shares. Voting rights are not cumulative and, therefore, the holders of more than 50% of the common stock could, if they chose to do so, elect all of the directors of the Company.

On June 7, 2024, the Company issued 35,000 Common Shares valued at $100,275 for investor awareness and marketing services. The fair value of the shares issued was based on the trading price of the Company’s Common Shares on the date of issuance, being $2.865 per Common Share.

During the nine-month period ended September 30, 2024, the Company issued 408,125 Common Shares for total proceeds to the Company of $489,750 on exercise of the Warrants issued as part of the Offering, which the Company closed in its fiscal 2023 year. Of this amount, $18,000 was received during the year ended December 31, 2023, and was recorded as obligation to issue shares. The Company paid $2,874 in share issuance costs associated with exercise of these Warrants.

Subsequent to September 30, 2024, the Company issued further 46,000 Common Shares for total proceeds to the Company of $55,200 of which $45,300 were received prior to September 30, 2024, and therefore recorded as obligation to issue shares at September 30, 2024.

Warrants

The changes in the number of warrants outstanding for the nine-month period ended September 30, 2024, and for the year ended December 31, 2023, are as follows:

	Nine months ended September 30, 2024					Year ended December 31, 2023
	Number of warrants			Weighted average exercise price		Number of warrants			Weighted average exercise price
Warrants outstanding, beginning		12,349,912		$	1.20		-		$	n/a
Warrants issued - offering		-		$	n/a		12,499,343		$	1.20
Warrants issued - agent		-		$	n/a		124,994		$	1.20
Warrants exercised		(408,125	)	$	1.20		(274,425	)	$	1.20
Warrants outstanding, ending		11,941,787		$	1.20		12,349,912		$	1.20

Details of warrants outstanding as at September 30, 2024, are as follows:

Number of warrants exercisable			Expiry date	Exercise price
	391,739		July 27, 2025	$	1.20
	2,754,824		August 28, 2025	$	1.20
	2,054,097		September 23, 2025	$	1.20
	55,373	(1)	September 23, 2028	$	1.20
	4,682,267		October 18, 2025	$	1.20
	1,933,866		November 3, 2025	$	1.20
	69,621	(1)	November 3, 2028	$	1.20
	11,941,787			$	1.20

(1) Agent warrants

At September 30, 2024, the weighted remaining average life of the warrants was 1.04 years.

Share-based compensation

During the three- and nine-month periods ended September 30, 2024 and 2023, the Company recognized share-based compensation as follows:

	Three months ended September 30,				Nine months ended September 30,
	2024		2023		2024		2023
Directors and CEO	$	248,468	$	249,149	$	740,002	$	739,322
Officer – VP of Operations		175,000		175,000		525,000		408,333
Consultants		116,667		116,667		350,001		272,223
Investor awareness and marketing		-		-		100,275		-
	$	540,135	$	540,816	$	1,715,278	$	1,419,878

Directors:

On December 30, 2021, the Company distributed a total of 6,005,000 shares of common stock to the Company’s directors (the “Director Shares”). The Director Shares are subject to the terms and conditions included in 3-year lock-up and vesting agreements (the “Lock-up Agreements”), which contemplate that the Director Shares will vest in equal annual installments over a 3-year term during which term the shareholders agreed not to sell, directly or indirectly, or enter into any other transactions involving the Company’s common shares regardless if the shares have vested or not.

The fair value of the shares was determined to be approximately $2,965,413 or $0.4938 per share based on the trading price of the Company’s common stock on the issue date adjusted for the restrictions under the Lock-up Agreements. The shares vest over a three-year time period.

As stated above, the Company distributed all of the awarded shares prior to vesting. As at September 30, 2024, 4,003,333 shares have vested and 2,001,667 shares will vest on December 31, 2024. As of September 30, 2024, unvested compensation related to the Director Shares of $248,468 will be recognized over the next three months.

Officer – VP of Operations:

On February 24, 2023, the Company entered into a consulting agreement with the Company’s newly appointed Vice President of Operations (the “VP Agreement”). The Company agreed to issue 2,000,000 shares of its common stock for the services. The shares vest ratably over a two-year period, beginning March 1, 2023, and vested shares are distributed quarterly. The fair value of the shares was $1,400,000 or $0.70 per share based on the trading price of the Company’s common stock on the date the service period began. As at September 30, 2024, the Company had distributed a total of 1,333,333 shares under the VP Agreement and had recorded an obligation to issue further 250,000 Common Shares, which were issued on October 28, 2024.

Unvested compensation related to the shares to be issued under the VP Agreement of $291,667 will be recognized over the next five months.

Consultants:

On February 24, 2023, the Company entered into two separate consulting agreements with consultants (the “Consulting Agreements”) in exchange for a total of 2,000,000 shares of its common stock. All shares vest ratably over a three-year period, beginning March 1, 2023, and vested shares are distributed quarterly. The fair value of the shares was $1,400,000 or $0.70 per share based on the trading price of the Company’s common stock on the date the service period began. As at September 30, 2024, the Company had distributed a total of 888,890 shares under the Consulting Agreements and had recorded an obligation to issue further 166,667 Common Shares, which were issued on October 28, 2024.

Unvested compensation related to the Shares to be issued under the Consulting Agreements of $661,111 will be recognized over the next 1.42 years.