WARRANTS

12 Months Ended

Dec. 31, 2023

WARRANTS

WARRANTS

NOTE 9 – WARRANTS

Between 2021 and 2023 the company issued warrants to investment bankers, promissory note lenders and entertainment talent for commissions and product endorsements.

Boustead Securities were issued 91,000 warrants on December 15, 2021pursuant to their underwriting agreement. On September 6, 2022, 100% of the warrants were exercised under the cashless option clause resulting in the issuance of 54,928 shares of the company’s common stock.

On January 25, 2023, the Company issued fully vested warrants to purchase 500,000 shares of the Company’s common stock to non-employees as compensation for services (“Compensation Warrants”). The Compensation Warrants have an exercise price of $1.00 and a contractual life of 5 years. As of December 31, 2023, total compensation costs related to the common stock warrants not yet recognized amounted to approximately $305,802. The amounts were recorded as prepaid compensation, for which there is a current and noncurrent portion that is amortized over the life of the contract. As of December 31, 2023, the current portion of $74,891 is included in prepaid expenses and other current assets on the balance sheet and the noncurrent portion of $230,911 is included in other assets. During the year ended December 31, 2023, $68,651 was amortized to sales and marketing expense.

A summary of the warrants issued, exercised and expired are shown below:

			Weighted		Remaining
			Avg		Contractual
Warrants	Shares		Exercise price		Life in years
Balances as at December 31, 2022		-	$	-		-
Issued		185,555		13.65		4.5
Exercised		-		-		-
Expired		-		-		-
Balances as at December 31, 2023		185,555		13.65		4.5

A summary of the outstanding warrants by holders’ name as at December 31, 2023, is shown in the table below. 

Date		Number of		Exercise		Black-Scholes
2023	Name	5-yr Warrants		Price		Valuation
2-14 and 10-19	Boustead Securities		19,558	$	15.00	$	194,257
2-14 and 10-19	EF Hutton		19,557		15.00		194,257
10-18 and 12-18	First Fire Global		24,074		15.00		58,245
10-19 and 12-11	Mast Hill Fund		72,366		15.00		193,572
4-Jan	Spanky's Clothing, Inc.		50,000		10.00		374,453
			185,555			$	1,014,784

The Black-Scholes / Binomial Option Pricing Model both use the following variables to calculate the value of an option or warrant for the years ended December 31, 2023, and 2022.

	Input Range	Input Range
	December 31	December 31
Description	2023	2022
a) Price of the Issuer’s Security	$3.20 - $3.38	$3.34 - $3.38
b) Exercise (strike) price of Security	$7.50 - $15.00	$7.50 - $15.00
c) Time to Maturity in years	3 to 5 years	3 to 5 years
d) Annual Risk-Free Rate	2-year T-Bill	2-year T-Bill
e) Annualized Volatility (Beta)	59% - 493%	59% - 493%