| Stockholders' Equity | NOTE I – STOCKHOLDERS’ EQUITY Holders of common stock are entitled to one vote
per share. The common stock does not have cumulative voting rights in the election of directors. Accordingly, the holders of a majority
of the outstanding shares of common stock entitled to vote in any election of directors may elect all of the directors standing for election.
Subject to preferential rights with respect to any series of preferred stock that may be issued, holders of the common stock are entitled
to receive ratably such dividends as may be declared by the board of directors on the common stock out of funds legally available therefore
and, in the event of liquidation, dissolution or winding-up of affairs, are entitled to share equally and ratably in all the remaining
assets and funds. Series A preferred stock is nonvoting capital
stock but may be converted into voting common stock. Each share of series A preferred stock is convertible at the option of the holder
at any time after the issuance into one share of common stock, subject to adjustment from time to time in the event (i) the Company subdivides
or combines its outstanding common stock into a greater or smaller number of shares, including stock splits and stock dividends; or (ii)
of a reorganization or reclassification of common stock, the consolidation or merger with or into another company, the sale, conveyance
or other transfer of substantially all of the Company assets to another corporation or other similar event, whereby securities or other
assets are issuable or distributable to the holders of the outstanding common stock upon the occurrence of any such event; or (iii) of
the issuance to the holders of Company common stock of securities convertible into, or exchangeable for, such shares of common stock. Each outstanding share of series A preferred stock
will automatically convert into one share of common stock (a) if the common stock commences public trading on the NASDAQ capital market
or better, (b) if the series A preferred stockholder receives distributions from the net profits pool equal to the original purchase price
paid for their registered links, or (c) five years after the date of issuance of the series A preferred stock. The Company does not have
any other right to require a conversion of the series A preferred stock into common stock. The Company does not have the option to redeem
outstanding shares of series A preferred stock. A holder of the series A preferred stock has no preemptive rights to subscribe for any
additional shares of any class of stock or for any issue of bonds, notes or other securities convertible into any class of stock. In the
event of a liquidation, dissolution or winding-up whether voluntary or otherwise, after payment of debts and other liabilities, the holders
of the series A preferred stock will be entitled to receive from the remaining net assets, before any distribution to the holders of the
common stock, the amount of $1.50 per share. After payment of the liquidation preference to the holders of series A preferred stock and
payment of any other distributions that may be required with respect to any other series of preferred stock, the remaining assets, if
any, will be distributed ratably to the holders of the common stock and the holders of the series A preferred stock on an as-if converted
basis. The series B preferred stock is voting capital
stock. The holders of the series B preferred stock will vote on an as-converted basis with the common stock on all matters submitted to
a vote of the shareholders. The holders of the series B preferred stock are not entitled to any dividends unless and until the series
B preferred stock is converted into common stock. Each share of series B preferred stock is convertible at the option of the holder at
any time after issuance into one share of common stock, subject to adjustment from time to time in the event (i) the Company subdivides
or combines into outstanding common stock into a greater or smaller number of shares, including stock splits and stock dividends; or (ii)
of a reorganization or reclassification of common stock, the consolidation or merger with or into another company, the sale, conveyance
or other transfer of substantially all of the Company assets to another corporation or other similar event, whereby securities or other
assets are issuable or distributable to the holders of the outstanding common stock upon the occurrence of any such event; or (iii) of
the issuance by us to the holders of common stock of securities convertible into, or exchangeable for, such shares of common stock. Each outstanding share of series B preferred stock
will automatically convert into one share of common stock at a conversion rate equal to the lesser of $3.00 per share or 75% of the average
closing price of the Company’s common stock as quoted on the public securities trading market on which our common stock is then
traded with the highest volume, for ten (10) consecutive trading days immediately after the first day of public trading of common stock
if common stock commences public trading on the NASDAQ capital market or better, but in any event no less than $2.50 per share or at $3.00
per share five years after the date of issuance of the series B preferred stock. In the event of a liquidation, dissolution or winding-up
whether voluntary or otherwise, after payment of debts and other liabilities, the holders of the series B preferred stock will be entitled
to receive from the remaining net assets, before any distribution to the holders of the common stock, and pari pasu with the payment of
a liquidation preference of $1.50 per share to the holders of the series A preferred stock, the amount of $3.00 per share. After payment
of the liquidation preference to the holders of the series A preferred stock and the series B preferred stock, and payment of any other
distribution that may be required with respect to any other series of preferred stock, the remaining assets, if any, will be distributed
ratably to the holders of the common stock, the holders of the series A preferred stock, and the holders of the series B preferred stock
on an as-if converted basis. The series C preferred stock is voting capital
stock. For so long as any shares of the series C preferred stock remain issued and outstanding, the holders thereof, voting separately
as a class, shall have the right, on or after July 20, 2016, to vote in an amount equal to 51% of the total vote (representing a super
majority voting power) with respect to all matters submitted to a vote of the shareholders of Wytec. Such vote shall be determined by
the holder(s) of a majority of the then issued and outstanding shares of series C preferred stock. For example, if there are 10,000 shares
of our common stock issued and outstanding at the time of such shareholder vote, the holders of the series C preferred stock, voting separately
as a class, will have the right to vote an aggregate of 10,408 shares, out of a total number of 20,408 shares voting. Additionally, the Company is prohibited from adopting
any amendments to the Company’s bylaws or articles of incorporation, as amended, making any changes to the certificate of designation
establishing the series C preferred stock, or effecting any reclassification of the series C preferred stock, without the affirmative
vote of at least 66-2/3% of the outstanding shares of series C preferred stock. The Company may, however, by any means authorized by law
and without any vote of the holders of shares of series C preferred stock, make technical, corrective, administrative or similar changes
to such certificate of designation that do not, individually or in the aggregate, adversely affect the rights or preferences of the holders
of shares of series C preferred stock. The holders of the series C preferred stock are
not entitled to any dividends. Holders of the series C preferred stock have no conversion rights. The shares of the series C preferred
stock shall be automatically redeemed by us at their par value on the first to occur of the following: (i) on the date that Mr. Gray ceases,
for any reason, to serve as officer, director or consultant of Wytec, or (ii) on the date that our shares of common stock first trade
on any national securities exchange provided that the listing rules of any such exchange prohibit preferential voting rights of a class
of securities of Wytec, or listing on any such national securities exchange is conditioned upon the elimination of the preferential voting
rights of the series C preferred stock set forth in the certificate of designation. A holder of the series C preferred stock has no preemptive
rights to subscribe for any additional shares of any class of stock of Wytec or for any issue of bonds, notes or other securities convertible
into any class of stock of Wytec. The holders of the Series C Preferred Stock are not entitled to any liquidation preference. In January 2020, the Company issued 554 shares
of common stock to one vendor for services rendered at fair value of $2,770. In March 2020, the Company issued a total of 20,000
shares of common stock to two investors for cash at $5.00 per share as part of the Company’s offering of units, each unit consisting
of one share of the Company’s common stock and one common stock purchase warrant. In February 2020, the Company issued 10,000 shares
of common stock at fair value of $50,000 to one employee pursuant to a severance agreement. In April 2020, the Company entered into a Repurchase
and General Release Agreement with one investor to repurchase 40,000 shares of common stock and 40,000 shares of series B preferred stock
at $2.50 per share in exchange for a note payable in the amount of $200,000 bearing no interest and due on March 31, 2021 as extended
under the terms of the note. No portion of the agreement with the investor was treated as an expense. This agreement has been cancelled.
See “NOTE M – SUBSEQUENT EVENTS.” In May 2020, the Company issued 40,000 shares
of common stock in consideration for the conversion of 40,000 shares of Series A Preferred Stock by one shareholder. In July 2020, the Company issued a total of 12,000
shares of common stock to two investors for cash at $5.00 per share as part of the Company’s offering of units, each unit consisting
of one share of the Company’s common stock and one common stock purchase warrant. In August 2020, the Company issued a total of
25,000 shares of common stock to four investors for cash at $5.00 per share as part of the Company’s offering of units, each unit
consisting of one share of the Company’s common stock and one common stock purchase warrant. In September 2020, the Company issued 4,375 shares
of common stock to one investor in lieu of making an accrued interest payment in cash at $5.00 per share as part of the Company’s
offering of units, each unit consisting of one share of the Company’s common stock and one common stock purchase warrant. In September 2020, one investor exercised 500
common stock purchase warrants for which the Company issued 500 shares of common stock for cash at $5.00 per share. In September 2020, the Company issued 83,333 shares
of common stock in consideration for the conversion of 83,333 shares of Series B Preferred shares by one shareholder. In October 2020, the Company issued 20,000 shares
of common stock in consideration for the conversion of 20,000 shares of Series A Preferred shares by one shareholder. In October 2020, the Company issued 172,964 shares
of common stock in consideration for the conversion of 172,964 shares of Series B Preferred shares by three shareholders. In October 2020, the Company issued a total of
21,000 shares of common stock to three investors for cash at $5.00 per share as part of the Company’s offering of units, each unit
consisting of one share of the Company’s common stock and one common stock purchase warrant. In October 2020, one investor exercised 5,000
common stock purchase warrants for which the Company issued 5,000 shares of common stock for cash at $5.00 per share. In November 2020, the Company issued a total of
60,000 shares of common stock in consideration for the conversion of 60,000 shares of Series A Preferred Stock by two shareholders. In November 2020, the Company issued a total of
55,000 shares of common stock in consideration for the conversion of 55,000 shares of Series B Preferred Stock by six shareholders. In November 2020, one investor exercised 20,000
common stock purchase warrants for which the Company issued 20,000 shares of common stock for cash at $5.00 per share. In December 2020, the Company issued a total of
20,000 shares of common stock to two investors for cash at $5.00 per share as part of the Company’s offering of units, each unit
consisting of one share of the Company’s common stock and one common stock purchase warrant. In December 2020, the Company issued a total of
20,000 shares of common stock in consideration for the conversion of 20,000 shares of Series A Preferred Stock by one shareholder. In December 2020, the Company issued a total of
11,602 shares of common stock in consideration for the conversion of 11,602 shares of Series B Preferred Stock by two shareholders. In December 2020, three investors exercised a
total of 40,000 common stock purchase warrants for which the Company issued 40,000 shares of common stock for cash at $5.00 per share. During the year, the Company issued 14,474 shares
of common stock to nine employees as compensation. During the year, the Company issued 2,296 shares
of common stock to one vendor for services rendered at fair value of $11,484. During the year ended December 31, 2019, there
were 193,800 shares of common stock issued for cash proceeds of $969,000 at the price of $5.00 per share; 120,000 shares of common stock
issued in exchange for deferred revenue of $390,000; 114,820 shares of common stock issued from exercise of warrants; and 28,526 shares
of common stock issued for stock based compensation of $142,630. |
