Stockholders' Equity (Deficit) | NOTE 8: STOCKHOLDERS’ EQUITY (DEFICIT) The total number of shares of all classes of stock that the Company shall have the authority to issue is 7,625,000,000 shares consisting of 7,500,000,000 shares of common stock with a $0.000001 par value per share of which 2,320,876,565 are outstanding at January 31, 2020 and 125,000,000 shares of preferred stock, par value $0.000001 per share of which (A) 120,000,000 shares have been designated as Series A Convertible Preferred of which 41,444,601 are outstanding at January 31, 2020, (B) 1,000,000 shares have been designated as Series B Convertible Preferred Stock, of which no shares are outstanding at January 31, 2020 and (C) 1,000,000 have been designated as Series C Convertible Preferred Stock, of which 430,801 shares are outstanding at January 31, 2020. On January 11, 2019, stockholders holding a majority of the voting power of the Company’s issued and outstanding shares of voting stock, executed a written consent approving 1) an amendment to the Company’s Amended and Restated Certificate of Incorporation, as amended (the “Certificate of Incorporation”) to (i) increase the number of authorized shares of common stock of the Company to 7,500,000,000 shares from 1,500,000,000 shares and (ii) decrease the par value of the common stock and preferred stock to $0.000001 from $0.001 per share; and 2) granting discretionary authority to the Company’s Board of Directors to amend the Certificate of Incorporation to effect one or more consolidations of the issued and outstanding shares of common stock of the Company, pursuant to which the shares of common stock would be combined and reclassified into one share of common stock at a ratio within the range from 1-for-2 up to 1-for-400 (the “Reverse Stock Split”), provided that, (X) that the Company may not effect Reverse Stock Splits that, in the aggregate, exceed 1-for-400, and (Y) any Reverse Stock Split may not be completed later than January 11, 2020. Since the Company had not effectuated any Reverse Stock Split by January 11, 2020, the related approval expired. Series A Convertible Preferred Stock On January 8, 2020, a shareholder converted 3,125,500 shares of Series A Preferred Stock into the same number of shares of the Company’s common stock. Common Stock During the three months ended January 31, 2020, the Company: ● issued 15,098,054 shares of its common stock valued at $877,039 and reflected 66,525,117 shares of its common stock valued at $465,675 as shares to be issued, as repayment for outstanding principal and interest on a convertible promissory note as requested by the note holder in accordance with contractual terms. ● reflected 3,125,500 shares of its common stock as shares to be issued for the conversion of 3,125,500 shares of its Series A Convertible Preferred stock. ● reflected 7,500,000 shares of its common stock as shares to be issued for the vesting of the first 25% of a 30,000,000 common stock grant to Christopher Cutchens, the Company’s Chief Financial Officer. The Company recorded $56,250 of stock-based compensation expense during the three months ended January 31, 2020, related to this common stock grant. Common Stock Warrants Under the provisions of the employment agreement with its Chief Executive Officer, the Company is committed to issue warrants to purchase shares of its common stock as follows: ● For each $1 million in revenue generated by the Company, a warrant to purchase 7,500,000 shares of the Company’s common stock at an exercise price of $0.006 per warrant will be granted, until such time as the Chief Executive Officer owns 20% of the then-outstanding shares of common stock. ● At the beginning of each calendar year, a warrant to acquire 3% of the Company’s outstanding common stock will be granted. At January 31, 2020, there remained approximately 284 million shares of the Company’s common stock, to be issued if earned, under the provisions of the Chief Executive Officer’s employment agreement, which would increase such ownership percentage of the Company’s common stock to the 20% limit. The Company estimates the fair value of each award on the date of grant using a Black-Scholes option valuation model that uses the following assumptions for warrants earned during the three months ended January 31, 2020: Expected volatility 194.54% - 399.10 % Weighted-average volatility 137.58 % Expected dividends 0 % Expected term (in years) 1.0 Risk-free rate 1.46% - 1.57 % During the three months ended January 31, 2020, the grant date fair value of the warrants earned was $2,253,238. The following table sets forth common share purchase warrants outstanding at January 31, 2020: Weighted Average Exercise Intrinsic Warrants Price Value Outstanding, October 31, 2019 725,705,000 $ 0.003 $ - Warrants granted and issued 114,173,355 $ 0.006 $ - Warrants exercised - $ - $ - Warrants forfeited (1,000,000 ) $ (0.025 ) $ - Outstanding, January 31, 2020 838,878,355 $ 0.004 $ - Common stock issuable upon exercise of warrants 838,878,355 $ 0.004 $ - Common Stock Issuable Common Stock Issuable Upon Exercise of Upon Warrants Warrants Outstanding Exercisable Weighted Number Average Weighted Number Weighted Range of Outstanding Remaining Average Exercisable Average Exercise at January 31, Contractual Exercise at January 31, Exercise Prices 2020 Life (Years) Price 2020 Price $ 0.0025 580,000,000 2.10 $ 0.0025 580,000,000 $ 0.0025 $ 0.0060 256,673,355 0.78 $ 0.0060 256,673,355 $ 0.0060 $ 0.0500 1,000,000 0.92 $ 0.0500 1,000,000 $ 0.0500 $ 0.1000 1,205,000 0.10 $ 0.1000 1,205,000 $ 0.1000 838,878,355 1.69 $ 0.0038 838,878,355 $ 0.0038 |