| STOCKHOLDERS’ EQUITY | NOTE
5 - STOCKHOLDERS’ EQUITY Series
A Preferred Stock On
November 8, 2021, in connection with the Company’s public offering, the Company’s Board of Directors adopted a resolution
allowing for the designation and issuance of 1,543,158 .01 0.001 1,543,158 Series
B Preferred Stock Effective
September 8, 2022, the Company issued 1,543,158 The terms of the Series B are substantially identical to those of the Series A, except that, among other things,
the limitation on beneficial ownership of common stock of the Company upon a conversion of the Series B into Common Stock, and the limitation
on the number of votes attributable to the Series B, is 9.99% of the then outstanding Common Stock of the Company instead of 4.99% as
provided for the Series A. Dividends Series
B holders shall be entitled to receive, when and as declared by the Board of Directors, dividends on a pari passu basis with the holders
of the shares of Common Stock based upon the number of shares of Common Stock into which the Series B is then convertible. Voting
Rights Series
B holders shall be entitled to vote on all matters presented to the stockholders of the Company for a vote at a meeting of stockholders
of the Company or a written consent in lieu of a meeting of stockholders of the Company, and shall be entitled to such number of votes
for each share of Series B entitled to vote at such meetings or pursuant to such consent, voting together with the holders of shares
of Common Stock and other shares of preferred stock who are entitled to vote, and not as a separate class, except as required by law.
The number of votes to which the Series B holders shall be entitled to vote for each share of Series B shall equal the number of shares
of Common Stock into which such Series B is then convertible; provided, however, that in no event shall a Series B holder be entitled
to vote more than 9.99% Conversion Optional
Conversion - Each share of Series B shall be convertible, at any time and from time to time, at the option of the Series B holder, into
one share of Common Stock 9.99% Automatic
Conversion – From time to time, in the event of that an event occurs, including adjustment due to merger, consolidation, etc.,
subdivision or combination of Common Stock, adjustment due to distribution, purchase rights, and notice of adjustments, which has the
effect of reducing a Series B holder’s beneficial ownership of shares of common stock to less than 9.5% 9.99% On
October 25, 2022, Auctus converted 25,000 25,000 1,518,158 Warrant
and Option Valuation The
Company has computed the fair value of warrants and options granted using the Black-Scholes option pricing model. The expected term used
for warrants and options issued to non-employees is the contractual life and the expected term used for options issued to employees and
directors is the estimated period of time that options granted are expected to be outstanding. The Company utilizes the “simplified”
method to develop an estimate of the expected term of “plain vanilla” employee option grants. The Company is utilizing an
expected volatility figure based on a review of the historical volatilities, over a period of time equivalent to the expected life of
the instrument being valued, of similarly positioned public companies within its industry. The risk-free interest rate was determined
from the implied yields from U.S. Treasury zero-coupon bonds with a remaining term consistent with the expected term of the instrument
being valued. Stock
Options In
applying the Black-Scholes option pricing model to stock options granted, the Company used the following assumptions: SCHEDULE OF STOCK OPTIONS GRANTED ASSUMPTIONS
For the Three Months Ended For the Three Months Ended
March 31, March 31,
2023 2022
Risk free interest rate 4.22 % 2.42 %
Expected term (years) 3.5 3.50
Expected volatility 175 % 286 %
Expected dividends 0.00 % 0.00 % The
Company granted options for the purchase of 629,017 1,745,000 The Company granted options for the purchase
of 25,000 122,117 A
summary of the stock option activity during the three months ended March 31, 2023 is presented below: SCHEDULE
OF STOCK OPTION ACTIVITY
Number of Options Weighted Average Exercise Price
Outstanding, January 1, 2023 864,639 $ 5.08
Granted 629,017 2.91
Expired - -
Outstanding, March 31, 2023 1,493,656 $ 4.17
Exercisable, March 31, 2023 951,222 $ 4.62 Restricted
Stock Units Pursuant
to the 2021 Plan, the Company may grant restricted stock units (“RSUs”) to employees, consultants or non-employee directors
(“Eligible Individuals”). The number, terms and conditions of the RSUs that are granted to Eligible Individuals are determined
on an individual basis by the 2021 Plan administrator. On the distribution date, the Company shall issue to the Eligible Individual one
unrestricted, fully transferable share of the Company’s common stock (or the fair market value of one such share in cash) for each
vested and nonforfeitable RSU. A
summary of our unvested RSUs as of March 31, 2023 is as follows: SCHEDULE
OF UNVESTED RESTRICTED STOCK UNITS
Number of Shares
Outstanding, December 31, 2022 201,870
Granted -
Forfeited -
Vested (104,043 )
Outstanding, March 31, 2023 97,827 The
following table presents information related to stock compensation expense: SCHEDULE OF STOCK OPTION EXPENSE
For the three months ended March 31, Unrecognized at March 31, Weighted Average Remaining Amortization Period
2023 2022 2023 (Years)
Research and development $ - $ - $ -
General and administrative 3,339,187 3,375,903 3,766,772
$ 3,339,187 $ 3,375,903 $ 3,766,772 The
following table presents stock compensation by award type: SCHEDULE
OF STOCK COMPENSATION BY AWARD TYPE
For the three months ended March 31,
2023 2022
Options $ 2,190,428 $ 2,138,949
RSUs 1,148,759 1,164,135
Shares issued for services - 72,819
$ 3,339,187 $ 3,375,903 |
