Cover
Cover - shares | 6 Months Ended | |
Jun. 30, 2023 | Aug. 15, 2023 | |
Cover [Abstract] | ||
Entity Registrant Name | MIDWEST ENERGY EMISSIONS CORP. | |
Entity Central Index Key | 0000728385 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Emerging Growth Company | false | |
Entity Current Reporting Status | Yes | |
Document Period End Date | Jun. 30, 2023 | |
Entity Filer Category | Non-accelerated Filer | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2023 | |
Entity Common Stock Shares Outstanding | 94,285,034 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 000-33067 | |
Entity Incorporation State Country Code | DE | |
Entity Tax Identification Number | 87-0398271 | |
Entity Address Address Line 1 | 1810 Jester Drive | |
Entity Address City Or Town | Corsicana | |
Entity Address State Or Province | TX | |
Entity Address Postal Zip Code | 75109 | |
City Area Code | 614 | |
Local Phone Number | 505-6115 | |
Entity Interactive Data Current | Yes |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEET - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Current assets | ||
Cash | $ 1,946,217 | $ 1,504,225 |
Accounts receivable | 2,043,328 | 2,777,607 |
Inventory | 891,219 | 991,131 |
Prepaid expenses and other assets | 87,899 | 267,393 |
Total current assets | 4,968,663 | 5,540,356 |
Security deposits | 10,175 | 10,175 |
Property and equipment, net | 1,827,507 | 1,828,592 |
Right of use asset - operating lease | 31,504 | 51,563 |
Intellectual property, net | 1,807,297 | 1,909,597 |
Total assets | 8,645,146 | 9,340,283 |
Current liabilities | ||
Accounts payable and accrued expenses (related party $108,333 and $25,000 at June 30, 2023 and December 31, 2022, respectively) | 3,078,509 | 2,946,835 |
Current portion of operating lease liability | 33,058 | 43,262 |
Customer credits | 167,000 | 167,000 |
Accrued salaries | 0 | 67,478 |
Total current liabilities | 3,278,567 | 3,224,575 |
Operating lease liability | 0 | 11,289 |
Secured note payable, net of discount - related party | 229,633 | 219,962 |
Unsecured note payable, net of discount and issuance costs - related party | 10,315,979 | 9,663,056 |
Profit share liability - related party | 3,952,157 | 3,638,260 |
Total liabilities | 17,776,336 | 16,757,142 |
Stockholders' deficit | ||
Preferred stock, $0.001 par value: 2,000,000 shares authorized, no shares issued | 0 | 0 |
Common stock, $0.001 par value; 150,000,000 shares authorized 94,267,296 and 93,087,796 shares issued and outstanding as of June 30, 2023 and December 31, 2022 respectively. | 94,268 | 93,088 |
Additional paid-in capital | 61,684,385 | 61,188,442 |
Accumulated deficit | (70,909,843) | (68,698,389) |
Total stockholders' deficit | (9,131,190) | (7,416,859) |
Total liabilities and stockholders' deficit | $ 8,645,146 | $ 9,340,283 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEET (Parenthetical) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
CONDENSED CONSOLIDATED BALANCE SHEET | ||
Accounts payable and accrued expenses, related party | $ 108,333 | $ 25,000 |
Preferred stock, par value per share | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 2,000,000 | 2,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value per share | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 94,267,296 | 93,087,796 |
Common stock, shares outstanding | 94,267,296 | 93,087,796 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) | ||||
Revenues | $ 4,111,721 | $ 5,128,882 | $ 7,124,469 | $ 8,470,467 |
Costs and expenses: | ||||
Cost of sales | 2,651,077 | 3,363,447 | 4,646,491 | 5,705,478 |
Selling, general and administrative expenses (related party of $137,500, $75,385, $275,000 and $150,385) | 1,762,498 | 1,459,759 | 3,680,407 | 2,960,178 |
Interest expense (related party of $339,444, $503,887, $675,024 and $1,002,242) | 339,444 | 503,887 | 675,024 | 1,002,242 |
Loss on change in fair value of profit share | 122,857 | 158,456 | 313,897 | 307,417 |
Total costs and expenses | 4,875,876 | 5,485,549 | 9,315,819 | 9,975,315 |
Net loss before provision for income taxes | (764,155) | (356,667) | (2,191,350) | (1,504,848) |
Provision for income taxes | (315) | 0 | (20,104) | 0 |
Net loss | $ (764,470) | $ (356,667) | $ (2,211,454) | $ (1,504,848) |
Net loss per common share - basic and diluted | $ (0.01) | $ 0 | $ (0.02) | $ (0.02) |
Weighted average common shares outstanding | 94,251,637 | 89,371,132 | 94,045,383 | 89,245,211 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS DEFICIT (UNAUDTIED) - USD ($) | Total | Common Stock | Additional Paid-In Capital | Accumulated Deficit |
Balance, shares at Dec. 31, 2021 | 89,115,951 | |||
Balance, amount at Dec. 31, 2021 | $ (10,239,476) | $ 89,116 | $ 56,788,321 | $ (67,116,913) |
Issuance of stock options | 138,622 | $ 0 | 138,622 | 0 |
Stock issued for cashless exercise of options, shares | 5,181 | |||
Stock issued for cashless exercise of options, amount | 0 | $ 5 | (5) | 0 |
Net loss | (1,148,181) | $ 0 | 0 | (1,148,181) |
Balance, shares at Mar. 31, 2022 | 89,121,132 | |||
Balance, amount at Mar. 31, 2022 | (11,249,035) | $ 89,121 | 56,926,938 | (68,265,094) |
Balance, shares at Dec. 31, 2021 | 89,115,951 | |||
Balance, amount at Dec. 31, 2021 | (10,239,476) | $ 89,116 | 56,788,321 | (67,116,913) |
Net loss | (1,504,848) | |||
Share based compensation expense | 337,367 | |||
Balance, shares at Jun. 30, 2022 | 89,871,132 | |||
Balance, amount at Jun. 30, 2022 | (11,246,957) | $ 89,871 | 57,284,933 | (68,621,761) |
Balance, shares at Mar. 31, 2022 | 89,121,132 | |||
Balance, amount at Mar. 31, 2022 | (11,249,035) | $ 89,121 | 56,926,938 | (68,265,094) |
Net loss | (356,667) | $ 0 | 0 | (356,667) |
Stock issued for consulting services, shares | 500,000 | |||
Stock issued for consulting services, amount | 160,000 | $ 500 | 159,500 | 0 |
Issuance of stock for compensation, shares | 250,000 | |||
Issuance of stock for compensation, amount | 55,000 | $ 250 | 54,750 | 0 |
Share based compensation expense | 143,745 | $ 0 | 143,745 | 0 |
Balance, shares at Jun. 30, 2022 | 89,871,132 | |||
Balance, amount at Jun. 30, 2022 | (11,246,957) | $ 89,871 | 57,284,933 | (68,621,761) |
Balance, shares at Dec. 31, 2022 | 93,087,796 | |||
Balance, amount at Dec. 31, 2022 | (7,416,859) | $ 93,088 | 61,188,442 | (68,698,389) |
Issuance of stock options | 30,029 | $ 0 | 30,029 | 0 |
Stock issued for cashless exercise of options, shares | 311,880 | |||
Stock issued for cashless exercise of options, amount | 0 | $ 312 | (312) | 0 |
Net loss | (1,446,984) | $ 0 | 0 | (1,446,984) |
Stock issued for cash exercise of options, shares | 850,000 | |||
Stock issued for cash exercise of options, amount | 209,500 | $ 850 | 208,650 | 0 |
Issuance of stock for compensation | 120,000 | $ 0 | 120,000 | 0 |
Balance, shares at Mar. 31, 2023 | 94,249,676 | |||
Balance, amount at Mar. 31, 2023 | (8,504,314) | $ 94,250 | 61,546,809 | (70,145,373) |
Balance, shares at Dec. 31, 2022 | 93,087,796 | |||
Balance, amount at Dec. 31, 2022 | (7,416,859) | $ 93,088 | 61,188,442 | (68,698,389) |
Net loss | (2,211,454) | |||
Share based compensation expense | 287,623 | |||
Balance, shares at Jun. 30, 2023 | 94,267,296 | |||
Balance, amount at Jun. 30, 2023 | (9,131,190) | $ 94,268 | 61,684,385 | (70,909,843) |
Balance, shares at Mar. 31, 2023 | 94,249,676 | |||
Balance, amount at Mar. 31, 2023 | (8,504,314) | $ 94,250 | 61,546,809 | (70,145,373) |
Issuance of stock options | 16,260 | $ 0 | 16,260 | 0 |
Stock issued for cashless exercise of options, shares | 17,620 | |||
Stock issued for cashless exercise of options, amount | 0 | $ 18 | (18) | 0 |
Net loss | (764,470) | 0 | 0 | (764,470) |
Issuance of stock for compensation | 121,334 | $ 0 | 121,334 | 0 |
Balance, shares at Jun. 30, 2023 | 94,267,296 | |||
Balance, amount at Jun. 30, 2023 | $ (9,131,190) | $ 94,268 | $ 61,684,385 | $ (70,909,843) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDTIED) - USD ($) | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Cash flows from operating activities | ||
Net loss | $ (2,211,454) | $ (1,504,848) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Stock-based compensation - amortization of prepaid services | 32,683 | 112,916 |
Stock-based compensation expense | 287,623 | 337,367 |
Amortization of discount of notes payable | 662,594 | 919,884 |
Amortization of debt issuance costs | 0 | 60,477 |
Amortization of right to use assets - operating lease | 20,059 | 201,634 |
Amortization of patent rights | 102,300 | 102,300 |
Depreciation expense | 1,085 | 10,862 |
Loss on change in fair value of profit share | 313,897 | 307,417 |
Change in assets and liabilities | ||
Decrease (Increase) in accounts receivable | 734,279 | (1,947,959) |
Decrease in inventory | 99,912 | 227,726 |
Decrease (Increase) in prepaid expenses and other assets | 146,811 | (252,013) |
Increase in accounts payable and accrued liabilities | 131,674 | 591,422 |
Decrease in accrued salaries | (67,478) | (91,531) |
Decrease in operating lease liability | (21,493) | (202,670) |
Net cash provided by (used in) operating activities | 232,492 | (1,127,016) |
Cash flows from financing activities | ||
Payments of equipment notes payable | 0 | (2,677) |
Proceeds from the issuance of short term debt - related party | 0 | 250,000 |
Proceeds from exercise of stock options | 209,500 | 0 |
Net cash provided by financing activities | 209,500 | 247,323 |
Net increase (decrease) in cash | 441,992 | (879,693) |
Cash - beginning of period | 1,504,225 | 1,388,307 |
Cash - end of period | 1,946,217 | 508,614 |
Cash paid during the period for: | ||
Interest | 0 | 0 |
Taxes | 0 | 14,163 |
SUPPLEMENTAL DISCLOSURE OF NON-CASH TRANSACTIONS | ||
Stock issued for prepaid services | $ 0 | $ 160,000 |
Organization
Organization | 6 Months Ended |
Jun. 30, 2023 | |
Organization | |
Organization | Note 1 - Organization Midwest Energy Emissions Corp. Midwest Energy Emissions Corp. is organized under the laws of the State of Delaware. MES, Inc. MES, Inc. is incorporated in the State of North Dakota. MES, Inc. is a wholly owned subsidiary of Midwest Energy Emissions Corp. and is engaged in the business of developing and commercializing state of the art control technologies relating to the capture and control of mercury emissions from coal fired boilers in the United States and Canada. ME2C Sponsor LLC and ME2C Acquisition Corp. ME2C Sponsor LLC is a limited liability company formed in the State of Delaware and is a wholly owned subsidiary of Midwest Energy Emissions Corp. and owns 85% of ME2C Acquisition Corp. A decision was made in January 2023 to liquidate these entities. As such, as of December 31, 2022, the Company wrote off the assets for these entities and recorded a $95,500 loss. |
Liquidity and Financial Conditi
Liquidity and Financial Condition | 6 Months Ended |
Jun. 30, 2023 | |
Liquidity and Financial Condition | |
Liquidity and Financial Condition | Note 2– Liquidity and Financial Condition Under ASC 205-40, Presentation of Financial Statements—Going Concern As reflected in the consolidated financial statements, the Company had approximately $1.9 million in cash at June 30, 2023. In addition, the Company had cash provided by operating activities of $0.2 million for the six months ended June 30, 2023, had working capital of $1.7 million and an accumulated deficit of $70.9 million at June 30, 2023. The accompanying condensed consolidated financial statements as of June 30, 2023 have been prepared assuming the Company will continue as a going concern. On October 28, 2022, the Company’s principal lender agreed to extend the maturity date of all of its existing secured and unsecured debt in the principal amount of $13.4 million from October 31, 2022 to August 25, 2025 (see Note 7 - Related Party ). |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2023 | |
Basis of Presentation and Summary of Significant Accounting Policies | |
Basis of Presentation and Summary of Significant Accounting Policies | Note 3 – Basis of Presentation and Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of Rule 8-03 of Regulation S-X promulgated by the United States Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, these financial statements do not include all of the information and footnotes required for complete financial statements and should be read in conjunction with the audited consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 filed on May 15, 2023, from which the accompanying condensed consolidated balance sheet dated December 31, 2022 was derived. In management’s opinion, the unaudited condensed consolidated financial statements reflect all adjustments necessary to present fairly the financial position as of June 30, 2023, and results of operations, changes in stockholders’ deficit and cash flows for all periods presented. The interim results presented are not necessarily indicative of results that can be expected for a full year. Principles of Consolidation The condensed consolidated financial statements include the accounts of Midwest Energy Emissions Corp. and its wholly-owned subsidiaries, MES, Inc. and ME2C Sponsor LLC, and ME2C Acquisition Corp. which is 85% owned by ME2C Sponsor LLC (collectively, the “Company”). Intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, valuation of equity issuances and disclosures of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. The Company uses estimates in accounting for, among other items, profit share liability, revenue recognition, allowance for doubtful accounts, stock-based compensation, income tax provisions, excess and obsolete inventory reserve and impairment of intellectual property. Actual results could differ from those estimates. Recoverability of Long-Lived and Intangible Assets Long-lived assets and certain identifiable intangibles held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Events relating to recoverability may include significant unfavorable changes in business conditions, recurring losses or a forecasted inability to achieve break-even operating results over an extended period. The Company evaluates the recoverability of long-lived assets based upon forecasted undiscounted cash flows. Should impairment in value be indicated, the carrying value of the long-lived and/or intangible assets would be adjusted, based on estimates of future discounted cash flows. The Company evaluated the recoverability of the carrying value of the Company’s property and equipment, right of use asset and intellectual property. No impairment charges were recognized for the three and six months ended June 30, 2023 and 2022. Fair Value of Financial Instruments The fair value hierarchy has three levels based on the inputs used to determine fair value, which are as follows: ☐ Level 1 ☐ Level 2 ☐ Level 3 — The fair value hierarchy requires the use of observable market data when available. In instances where the inputs used to measure fair value fall into different levels of the fair value hierarchy, the fair value measurement has been determined based on the lowest level input significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular item to the fair value measurement in its entirety requires judgment, including the consideration of inputs specific to the asset or liability. Cash and profit share liability were the only asset and liability measured at fair value on a recurring basis by the Company at June 30, 2023 and December 31, 2022. Cash is considered to be Level 1 and profit share liability is considered to be Level 3. Financial instruments include cash, accounts receivable, accounts payable, and short-term debt. The carrying amounts of these financial instruments approximated fair value at June 30, 2023 and December 31, 2022 due to their short-term maturities. The fair value of the notes payable at June 30, 2023 and December 31, 2022 approximated the carrying amount as the notes were recently issued at interest rates prevailing in the market and interest rates as of June 30, 2023 and December 31, 2022. The fair value of the notes payable was determined on a Level 2 measurement. Discounts on issued debt, as well as debt issuance costs, are amortized over the term of the individual notes. The fair value of the profit share liability at June 30, 2023 and December 31, 2022 was calculated using a discounted cash flow model based on estimated future cash payments. The fair value of the profit share liability was determined on a Level 3 measurement. These values are determined using pricing models for which the assumptions utilized management’s estimates. The following tables present the Company’s liabilities that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy. Fair Value Measurement as of June 30, 2023 Total Level 1 Level 2 Level 3 Liabilities: Profit share liability – related party (1) $ 3,952,157 $ - $ - $ 3,952,157 Total Liabilities $ 3,952,157 $ - $ - $ 3,952,157 Fair Value Measurement as of December 31, 2022 Total Level 1 Level 2 Level 3 Liabilities: Profit share liability – related party (1) $ 3,638,260 $ - $ - $ 3,638,260 Total Liabilities $ 3,638,260 $ - $ - $ 3,638,260 (1) See Note 7 - Related Party Revenue Recognition The Company records revenue in accordance with ASC 606, Revenue from Contracts with Customers Step 1: Identify the contract(s) with a customer. Step 2: Identify the performance obligations in the contract. Step 3: Determine the transaction price. Step 4: Allocate the transaction price to the performance obligations in the contract. Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation. Revenue is recognized when the Company satisfies its performance obligation under the contract by transferring the promised product to its customer that obtains control of the product. A performance obligation is a promise in a contract to transfer a distinct product to a customer. Most of the Company’s contracts have a single performance obligation, as the promise to transfer products or services is not separately identifiable from other promises in the contract and, therefore, not distinct. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring products. As such, revenue is recorded net of returns, allowances, customer discounts, and incentives. Sales and other taxes are excluded from revenues. Invoiced shipping and handling costs are included in revenue. Disaggregation of Revenue The Company generated revenue for the three and six months ended June 30, 2023 and 2022 by (i) delivering product to its commercial customers, (ii) completing and commissioning equipment projects at commercial customer sites and (iii) performing demonstrations of its technology at customers with the intent of entering into long term supply agreements based on the performance of the Company’s products during the demonstrations and (iv) licensing its technology to customers. Revenue for product sales is recognized at the point of time in which the customer obtains control of the product, at the time title passes to the customer upon shipment or delivery of the product based on the applicable shipping terms. Revenue for equipment sales is recognized upon commissioning and customer acceptance of the installed equipment per the terms of the purchase contract. Revenue for demonstrations and consulting services is recognized when performance obligations contained in the contract have been completed, typically the completion of necessary field work and the delivery of any required analysis per the terms of the agreement. The following table presents sales by operating segment disaggregated based on the type of product for the three and six months ended June 30, 2023 and 2022. All sales were in the United States. For the Three Months Ended June 30, 2023 For the Three Months Ended June 30, 2022 Product revenue $ 3,914,711 $ 4,791,054 License revenue 163,125 163,125 Demonstrations & Consulting revenue 27,000 27,000 Equipment revenue 6,885 147,703 $ 4,111,721 $ 5,128,882 For the Six Months Ended June 30, 2023 For the Six Months Ended June 30, 2022 Product revenue $ 6,431,111 $ 7,989,356 License revenue 618,750 233,408 Demonstrations & Consulting revenue 54,000 54,000 Equipment revenue 20,608 193,703 $ 7,124,469 $ 8,470,467 Accounts receivable and allowance for doubtful accounts Accounts receivable are presented net of an allowance for doubtful accounts. The Company maintains allowances for doubtful accounts for estimated losses. The Company reviews the accounts receivable on a periodic basis and makes general and specific allowances when there is doubt as to the collectability of individual balances. In evaluating the collectability of individual receivable balances, the Company considers many factors, including the age of the balance, a customer’s payment history, its current credit-worthiness and current economic trends. Accounts are written off after exhaustive efforts at collection. Management believed that the accounts receivable were fully collectable and no allowance for doubtful accounts was deemed to be required on its accounts receivable at June 30, 2023. The Company historically has not experienced significant uncollectible accounts receivable. As of June 30, 2023 and December 31, 2022, the Company’s allowance for doubtful accounts was $0. Income Taxes The Company follows the asset and liability method of accounting for income taxes under FASB ASC 740, Income Taxes FASB ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. There were no unrecognized tax benefits as of June 30, 2023 and 2022. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is no longer subject to tax examinations by tax authorities for the years prior to 2018. The Company may be subject to potential examination by federal, state, and city taxing authorities in the areas of income taxes. These potential examinations may include questioning the timing and amount of deductions, the nexus of income among various tax jurisdictions, and compliance with federal, state, and city tax laws. Management does not expect that the total amount of unrecognized tax benefits will materially change over the next twelve months. Basic and Diluted Loss Per Common Share Basic net loss per common share is calculated by dividing net loss by the weighted average number of shares outstanding during the period. Diluted loss per share is calculated by dividing net loss by the weighted-average number of common shares outstanding, after giving effect to all potentially dilutive common shares outstanding during the period. There were no dilutive potential common shares as of June 30, 2023 and 2022, because the Company incurred a net loss and basic and diluted losses per common share are the same. June 30, June 30, 2023 2022 Stock Options 17,694,204 19,108,576 Warrants 2,850,000 4,285,000 Total common stock equivalents excluded from basic and dilutive loss per share 20,544,204 23,393,576 Concentration of Credit Risk Financial instruments that subject the Company to credit risk consist of cash and equivalents on deposit with financial institutions and accounts receivable. The Company’s cash as of June 30, 2023 and December 31, 2022 is maintained at high-quality financial institutions and has not incurred any losses to date. Customer and Supplier Concentration For the six months ended June 30, 2023, three customers represented 28%, 19%, and 11% of the Company’s revenues, and for the six months ended June 30, 2022, four customers represented 16%, 16%, 13% and 11% of the Company’s revenues. At June 30, 2023, three customers represented 32%, 23% and 13% of the Company’s accounts receivable, and at June 30, 2022, four customers represented 25%, 18%, 12% and 11% of the Company’s accounts receivable. For the six months ended June 30, 2023, 87% of the Company’s purchases related to three suppliers. For the six months ended June 30, 2022, 92% of the Company’s purchases related to four suppliers. At June 30, 2023 and 2022, 74% and 57% of the Company’s accounts payable and accrued expenses related to two vendors, respectively. The Company believes there are numerous other suppliers that could be substituted should a supplier become unavailable or non-competitive. Contingencies Certain conditions may exist which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company’s management and its legal counsel assess such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company, or unasserted claims that may result in such proceedings, the Company’s legal counsel evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, the estimated liability would be accrued in the Company’s consolidated financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they arise from guarantees, in which case the guarantees would be disclosed. Recently Issued Accounting Standards Issued in June 2021, FASB Accounting Standards Update (ASU) No. 2016-13, Measurement of Credit Losses on Financial Instruments |
Inventory
Inventory | 6 Months Ended |
Jun. 30, 2023 | |
Inventory | |
Inventory | Note 4 - Inventory Inventory was comprised of the following at June 30, 2023 and December 31, 2022: June 30, December 31, 2023 2022 Raw Materials $ 391,179 $ 606,056 Spare Parts 40,322 90,374 Finished Goods 459,718 294,701 $ 891,219 $ 991,131 |
Property and Equipment Net
Property and Equipment Net | 6 Months Ended |
Jun. 30, 2023 | |
Property and Equipment Net | |
Property and Equipment, Net | Note 5 - Property and Equipment, Net Property and equipment at June 30, 2023 and December 31, 2022 are as follows: June 30, December 31, 2023 2022 Equipment & installation $ 1,095,140 $ 1,095,140 Trucking equipment 845,102 845,102 Office equipment, computer equipment and software 1,873 20,295 Total equipment 1,942,115 1,960,537 Less: accumulated depreciation (1,922,315 ) (1,939,652 ) Construction in process 1,807,707 1,807,707 Property and equipment, net $ 1,827,507 $ 1,828,592 The Company uses the straight-line method of depreciation over estimated useful lives of 2 to 5 years. During the three months ended June 30, 2023 and 2022 depreciation expense was $543 and $2,118, respectively. During the six months ended June 30, 2023 and 2022 depreciation expense was $1,085 and $10,862, respectively. |
Intellectual Property
Intellectual Property | 6 Months Ended |
Jun. 30, 2023 | |
Intellectual Property | |
Intellectual Property | Note 6 - Intellectual Property License and patent costs capitalized as of June 30, 2023 and December 31, 2022 are as follows: June 30, December 31, 2023 2022 Licenses and patents $ 3,068,995 $ 3,068,995 Less: Accumulated amortization (1,261,698 ) (1,159,398 ) Intellectual property, net $ 1,807,297 $ 1,909,597 Amortization expense for the three months ended June 30, 2023 and 2022 was $51,150 and $51,150, respectively. Amortization expense for the six months ended June 30, 2023 and 2022 was $102,300 and $102,300, respectively. Estimated annual amortization for each of the next five years is $204,600. |
Related Party
Related Party | 6 Months Ended |
Jun. 30, 2023 | |
Related Party | |
Related Party | Note 7 - Related Party Secured Note Payable On November 29, 2016, pursuant to a restated financing agreement entered with AC Midwest Energy, LLC (“AC Midwest”) on November 1, 2016, the Company closed on a secured note with AC Midwest (the “AC Midwest Secured Note”), which was to mature on December 15, 2018. AC Midwest is wholly-owned by a stockholder of the Company. The AC Midwest Secured Note is guaranteed by MES, is non-convertible and bears interest at a rate of 15.0% per annum, payable quarterly in arrears on or before the last day of each fiscal quarter. Interest expense for the three months ended June 30, 2023 and 2022 was $6,180 and $10,301 respectively. Interest expense for the six months ended June 30, 2023 and 2022 was $12,294 and $20,490, respectively. On February 25, 2019, per Amendment No. 3 to the Amended and Restated Financing Agreement, AC Midwest extended the maturity date from December 15, 2018 to August 25, 2022. On October 28, 2022, the Company, along with MES, and AC Midwest, executed Amendment No. 4 to the Amended and Restated Financing Agreement pursuant to which the maturity date of the AC Midwest Secured Note was extended to August 25, 2025. In addition, the interest rate on the remaining principal balance was reduced from 15.0% to 9.0% per annum. The Company has accounted for the extension as debt extinguishment with a related party. As such the Company recorded a capital contribution of $54,983 for the year ended December 31, 2022 on this exchange which is related to the difference in fair value of the note on the date of the exchange. As of both June 30, 2023 and December 31, 2022, total principal of $271,686 was outstanding on this note. Amortized discount recorded as interest expense for the three months ended June 30, 2023 and 2022 was $4,862 and $0, respectively. Amortized discount recorded as interest expense for the six months ended June 30, 2023 and 2022 was $9,671 and $0, respectively. As of June 30, 2023, the unamortized balance of the discount was $42,053, which is being expensed over the life of the loan. Unsecured Note Payable The Company has the following unsecured note payable - related party outstanding as of June 30, 2023 and December 31, 2022: June 30, December 31, 2023 2022 Unsecured note payable $ 13,154,931 $ 13,154,931 Less fair value adjustment on extinguishment, net of amortized discount of $652,923 and $230,868, respectively (2,838,952 ) (3,491,875 ) Total unsecured note payable 10,315,979 9,663,056 Less current portion - - Unsecured note payable, net of current portion $ 10,315,979 $ 9,663,056 On November 29, 2016, pursuant to a restated financing agreement entered with AC Midwest on November 1, 2016, the Company closed on an unsecured note with AC Midwest (the “AC Midwest Subordinated Note, which was to mature on December 15, 2020. On February 25, 2019, the Company, entered into an Unsecured Note Financing Agreement (the “Unsecured Note Financing Agreement”) with AC Midwest, pursuant to which AC Midwest issued an unsecured note in the principal amount of $13,154,931 (the “AC Midwest Unsecured Note”), which represented the outstanding principal and accrued and unpaid interest at closing. The Company determined that the rate of interest on the AC Midwest Subordinated Note was a below market rate of interest and determined that a discount of $6,916,687 should be recorded. This discount was based on an applicable market rate for unsecured debt for the Company of 21% and is being amortized as interest expense over the life of the loan. In accordance with the Unsecured Note Financing Agreement, AC Midwest shall be entitled to a profit participation preference equal to 1.0 times the original principal amount (the “Profit Share”). The Profit Share is “non-recourse” and shall only be derived from and computed on the basis of, and paid from, Net Litigation Proceeds from claims relating to the Company’s intellectual property, Net Revenue Share and Adjusted Free Cash Flow (as such terms are defined in the Unsecured Note Financing Agreement), and Equity Offering Net Proceeds as described below. On August 30, 2022, AC Midwest agreed to an extension of the maturity date of the AC Midwest Unsecured Note (and AC Midwest Secured Note) from August 25, 2022 to September 30, 2022. Such extension was expected to provide the Company sufficient time in which to conclude the process of negotiating certain changes and modifications to such financing arrangements. On September 28, 2022, AC Midwest agreed to an additional short-term extension of such maturity date from September 30, 2022 to October 31, 2022. The Company has accounted for the extension as debt extinguishment with a related party. As such the Company recorded a capital contribution of $488,274 on this exchange which is related to the difference in fair value of the note on the date of the exchange. On October 28, 2022, the Company, along with MES, and AC Midwest, executed Amendment No. 1 to Unsecured Note Financing Agreement (“Amendment No. 1”) pursuant to which the maturity date of the AC Midwest Unsecured Note was extended to August 25, 2025. In addition, the parties agreed that the Profit Share be increased by $4,500,000 from $13,154,931 (representing 1.0 times the original principal amount) to $17,654,931. The Company has accounted for the extension as debt extinguishment with a related party. As such the Company recorded a capital contribution of $3,234,469 on this exchange which is related to the difference in fair value of the note on the date of the exchange. Amortized discount recorded as interest expense for the three months ended June 30, 2023 and 2022 was $328,265 and $462,483, respectively. Amortized discount recorded as interest expense for the six months ended June 30, 2023 and 2022 was $652,923 and $919,884 respectively. As of June 30, 2023, the unamortized balance of the discount was $2,838,952 which is being expensed over the life of the loan. Principal Payments and the Profit Share In connection with the AC Midwest Unsecured Note the Company shall pay the principal outstanding, as well as the Profit Share, in an amount equal to 60.0% of Net Litigation Proceeds until such time as any litigation funder has been paid in full and, thereafter, in an amount equal to 75.0% of such Net Litigation Proceeds until the Unsecured Note and Profit Share have been paid in full. In addition, and within 30 days following the end of each fiscal quarter, the Company shall pay the principal outstanding and Profit Share in an aggregate amount equal to the Net Revenue Share (which means 60.0% of Net Licensing Revenue (as defined) from licensing the Company’s intellectual property) plus Adjusted Free Cash Flow until the Unsecured Note and Profit Share have been paid in full, provided, however, that such payments shall exclude the first $3,500,000 of Net Licensing Revenue and Adjusted Free Cash Flow achieved commencing with the fiscal quarter ending March 31, 2019. In addition, and pursuant to Amendment No. 1, the Company shall pay the principal outstanding and Profit Share in an aggregate amount equal to 75.0% of any Equity Offering Net Proceeds (as defined) until the Unsecured Note and Profit Share have been paid in full. Any remaining principal balance due on the Unsecured Note shall be due and payable in full on the maturity date. The Profit Share, however, if not paid in full on or before the maturity date, shall remain subject to Unsecured Note Financing Agreement until full and final payment. The Company is utilizing the methodology behind the ASC 815, Derivatives and Hedging Distinguishing Liabilities from Equity The following are the changes in the profit share liability (the only Level 3 financial instrument) during the six months ended June 30, 2023 and 2022: Profit Share as of January 1, 2023 $ 3,638,260 Addition - Loss on change in fair value of profit share 313,897 Profit Share as of June 30, 2023 $ 3,952,157 Profit Share as of January 1, 2022 $ 2,836,743 Addition - Loss on change in fair value of profit share 307,417 Profit Share as of June 30, 2022 $ 3,144,160 Debt Repayment and Exchange Agreement On June 1, 2021, the Company, along with MES, entered into a Debt Repayment and Exchange Agreement with AC Midwest, which was expected to repay all existing secured and unsecured debt obligations presently held by AC Midwest (the “Debt Repayment Agreement”). Pursuant to the Debt Repayment Agreement, the Company was at closing to repay the principal balance outstanding on the AC Midwest Secured Note in cash, together with any other amounts due and owing under such note and repay the outstanding debt under the AC Midwest Unsecured Note by paying and issuing a combination of cash and shares of common stock which AC Midwest had agreed to accept in full and complete repayment of the obligations thereunder. At closing, and with regard to the AC Midwest Unsecured Note, the Company was to pay AC Midwest $6,577,465 in cash representing 50.0% of the aggregate outstanding principal balance of such note, and issue shares of common stock to AC Midwest in exchange for the remaining 50.0% of the aggregate outstanding principal balance at an exchange price equal to 100% of the offering price of common stock in the Qualifying Offering (as defined below). With regard to the Profit Share, at closing the Company was to pay AC Midwest $2,305,308 in cash representing the Profit Share Valuation, and issue shares of common stock for $4,026,568 representing the Adjusted Profit Share Valuation (as such terms are defined in the Debt Repayment Agreement) at the same exchange price indicated above. The Company agreed to provide certain registration rights with respect to the shares issued thereunder. The closing was subject to various conditions including but not limited to the completion of an offering of equity securities resulting in net proceeds of at least $12.0 million by December 31, 2021, which was extended to June 30, 2022 (the “Qualifying Offering”). Such closing conditions were not met by June 30, 2022. On October 28, 2022, the parties entered into a Termination Agreement pursuant to which the parties agreed to terminate the Debt Repayment Agreement with immediate effect and that none of the parties shall have any further responsibility or liability thereunder. Short term debt On June 13, 2022, the Company entered into a promissory note in the amount of $250,000 with the Company’s Chairman of the Board of Directors. The note bears interest at 6% and is due on the earlier of 90 days or the Company having cash of $1,200,000. The note was repaid in full in 2022. Interest expense for the year ended December 31, 2022 was $4,937. Related Party Transactions Kaye Cooper Kay & Rosenberg, LLP provides certain legal services to the Company and was paid $100,000 and $50,384 for the three months ended June 30, 2023 and 2022, respectively, and was paid $191,752and $125,688 for the six months ended June 30, 2023 and 2022, respectively, for legal services rendered and disbursement incurred. David M. Kaye, a Director of the Company, is a partner of the law firm. At June 30, 2023 and December 31, 2022, $33,333 and $25,000, respectively, was owed to the firm for services rendered. In September 2022, the Company acquired a pickup truck from the Company’s then Chief Financial Officer for the purchase price of $10,727 which the parties determined to be its fair market value. On January 31, 2023, the Company entered into a License and Supply Agreement with Dakin Holdings Ltd., a company incorporated in Barbados (“Dakin”), effective as of January 1, 2023, pursuant to which Dakin has granted to the Company (i) a limited license to manufacture and produce for Dakin products comprising certain intellectual property owned by Dakin (the “Dakin IP”), and (ii) an exclusive license to commercialize the Dakin IP in the United States. In addition, the Company shall pay Dakin a license fee of $12,500 per month for a three-year period commencing as of the effective date and pay Dakin a royalty on all sales in the United States of the products comprising the Dakin IP made by the Company. Dakin is a company owned and controlled by the Company’s Chief Executive Officer and President. As of June 30, 2023, license fees of $75,000 were owed to Dakin. |
Operating Leases
Operating Leases | 6 Months Ended |
Jun. 30, 2023 | |
Operating Leases | |
Operating Leases | Note 8 - Operating Leases On July 1, 2015, the Company entered into a five-year lease for warehouse space in Corsicana, Texas. Rent is $3,750 monthly throughout the term of the lease. The Company is also responsible for the pro rata share of the projected monthly expenses for the property taxes. The current pro rata share is $882. The lease was extended on June 1, 2019 for five years. The Company recorded a right of use asset and an operating lease liability of $145,267. This amount represents the difference between the value from the remaining lease and the extended lease. For the six months ended June 30, 2023 and the year ended December 31, 2022, the Company recorded an operating lease right of use asset and liabilities as follows: June 30, December 31, 2023 2022 Right of use asset - operating lease $ 31,504 $ 51,563 Current portion of operating lease liability 33,058 43,262 Operating lease liability - 11,289 Future remaining minimum lease payments under these non-cancelable leases are as follows: For the twelve months ended June 30, 2023 $ 33,750 Total 33,750 Less discount (692 ) Total lease liabilities 33,058 Less current portion (33,058 ) Operating lease obligation, net of current portion $ - The weighted average remaining lease term for operating leases is 0.67 years and the weighted average discount rate used in calculating the operating lease asset and liability is 5.0%. For the six months ended June 30, 2023, payments on lease obligations were $22,500 and amortization on the right of use assets was $20,059. For the six months ended June 30, 2023 and 2022, the Company’s lease cost consists of the following components, each of which is included in costs and expenses within the Company’s consolidated statements of operations: For the Six Months For the Six Months Ended Ended June 30, June 30, 2023 2022 Operating lease costs $ 20,059 $ 201,634 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2023 | |
COMMITMENTS AND CONTINGENCIES | |
Commitments and Contingencies | Note 9 - Commitments and Contingencies Fixed Price Contract The Company’s multi-year contracts with its commercial customers contain fixed prices for product. These contracts expire between 2023 and 2025 and expose the Company to the potential risks associated with rising material costs during that same period. Legal proceedings On July 17, 2019, the Company initiated patent litigation against certain defendants in the U.S. District Court for the District of Delaware for infringement of certain United States patents owned by the Company. These patents relate to the Company’s two-part Sorbent Enhancement Additive (SEA ® During 2020, each of the four major utility defendants in the above action filed petitions for Inter Partes Review with the United States Patent and Trademark Office, seeking to invalidate certain claims to the patents which are subject to the litigation. Between July 2020 and January 2021, we entered into agreements with each of the four major utility defendants in such action which included certain monetary arrangements and pursuant to which we have dismissed all claims brought against each of them and their affiliates, and such parties have withdrawn from petitions for Inter Partes Review with the United States Patent and Trademark Office. Such agreements entered into with such parties provide each of them and their affiliates with a non-exclusive license to certain Company patents (related to the Company’s two-part Sorbent Enhancement Additive (SEA®) process) for use in connection with such parties’ coal-fired power plants. The above-described proceedings are continuing with respect to the other parties involved. On May 20, 2021, a U.S. District Court Magistrate Judge issued a report and recommendation that the above action should be permitted to proceed against 16 refined coal defendants named in the action directly involved in the refined coal program and operations, and be dismissed against 12 other defendants, primarily affiliated entities of the refined coal operators. Such report was issued in connection with certain motions to dismiss filed by the refined coal defendants. In September 2021, the Company received approval from the District Judge of the U.S. District Court in Delaware of the adoption of this report and recommendation of the Magistrate Judge to allow the Company to proceed with litigation claims against certain refined coal entities. As a result of an application made by the Company to the Court in March 2022 to add additional parties to the action (all affiliated entities of the already named defendants), there are now 24 refined coal defendants named in the action. In connection with such application, the District Court Magistrate Judge ruled in April 2022 that certain parties could be added but denied the application with respect to certain others. The fact discovery portion of the litigation has concluded. A jury trial date has been scheduled for November 2023. Except for the foregoing disclosures, the Company is not presently aware of any other material pending legal proceedings to which the Company is a party or of which any of its property is the subject. Litigation, including patent litigation, is inherently subject to uncertainties. As such, there can be no assurance that the Company will be successful in litigating and/or settling any of these claims. |
Stock Based Compensation
Stock Based Compensation | 6 Months Ended |
Jun. 30, 2023 | |
Stock Based Compensation | |
Stock Based Compensation | Note 10 - Stock Based Compensation Stock Based Compensation Stock based compensation consists of the amortization of common stock, stock options and warrants issued to employees, directors and consultants. For the three months ended June 30, 2023 and 2022, stock based compensation expense amounted to $158,414 and $268,536, respectively. For the six months ended June 30, 2023 and 2022, stock based compensation expense amounted to $320,306 and $450,283, respectively Such expense is classified in selling, general and administrative expenses. Common Stock On May 31, 2022, and pursuant to a consulting agreement dated May 31, 2022 with a nonaffiliated third party, the Company issued 500,000 shares of common stock to such party as part of its compensation thereunder. These shares of common stock were valued at $160,000 in accordance with FASB ASC Topic 718. The fair value of the shares is being amortized to selling, general and administrative expenses within the Company’s consolidated statements of operations over 12 months. On May 31, 2022, the Company issued a total of 250,000 shares of common stock to two Directors. These shares of common stock were valued at $55,000 in accordance with FASB ASC Topic 718. The fair value of the shares was expensed in full on the issuance date. On May 31, 2022, the Company issued a total of 3,000,000 shares of common stock to the Chief Executive Officer. These shares of common stock were valued at $960,000 in accordance with FASB ASC Topic 718. The fair value of the shares will be amortized as expense over the vesting period. The expense for the three and six months ended June 30, 2023 was $121,333 and $241,333 respectively. Stock Options On January 24, 2022, the Company extended the expiration dates of certain fully expensed previously granted nonqualified stock options (which were due to expire in February 2022) which were granted to five individuals to acquire an aggregate of 700,000 shares of the Company’s common stock under the Company’s 2014 Equity Incentive Plan and the 2017 Equity Incentive Plan (the “2017 Plan”). Such extended options are exercisable at prices ranging from $1.15 to $1.20 per share, representing the original fair market value of the common stock on the dates of grant as determined under the applicable Equity Plan. The options are fully vested and exercisable and will now expire five years from their original expiration dates. Based on a Black-Scholes valuation model, these modified options were valued at $138,623, in accordance with FASB ASC Topic 718, which was expensed on the amendment date in selling, general and administrative expenses within the Company’s condensed consolidated statements of operations. On February 2, 2022, the Company issued 5,181 shares of common stock to a certain option holder upon the cashless exercise of options to purchase an aggregate of 9,750 shares of common stock at exercise prices ranging from $0.20 to $0.33 per share based upon a market price of $0.54 per share as determined under the terms of the options. On May 31, 2022, the Company granted nonqualified stock options to the following executive officers: John Pavlish (Senior Vice President and Chief Technology Officer) and James Trettel (Vice President of Operations) – nonqualified stock options to each acquire 500,000 shares of the Company’s common stock; and Jami Satterthwaite (then Chief Financial Officer) – nonqualified stock options to acquire 100,000 shares of the Company’s common stock. On such date, two other employees were also granted nonqualified stock options to each acquire 50,000 shares of the Company’s common stock. All of such options were granted under the 2017 Plan and are exercisable at $0.21 per share, representing the fair market value of the common stock on the date of grant as determined under the 2017 Plan. The options are fully vested and exercisable and expire five years from their issuance date. Based on a Black-Scholes valuation model, these options were valued at $143,745, in accordance with FASB ASC Topic 718, which was expensed on the issuance date in selling, general and administrative expenses within the Company’s consolidated statements of operations. The valuation assumptions included an expected duration of 2.5 years, volatility of 96.83%, discount rate of 2.62% and dividends of $0. On February 1, 2023, the Company issued (i) 850,000 shares of common stock to the Company’s Chairman of the Board upon a cash exercise of options to purchase an aggregate of 850,000 shares of common stock at exercise prices ranging from $0.19 to $0.27 per share or $209,500 in the aggregate, (ii) 110,000 shares of common stock to the Company’s Chief Executive Officer upon a cashless exercise of an option to purchase 250,000 shares of common stock at an exercise price of $0.28 per share based upon a market price of $0.50 per share as determined under the terms of the option, and (iii) 155,000 shares of common stock to a director of the Company upon a cashless exercise of an option to purchase 250,000 shares of common stock at an exercise price of $0.19 per share based upon a market price of $0.50 per share as determined under the terms of the option. On February 20, 2023, the Company issued 17,858 shares of common stock to the Company’s Senior Vice President and Chief Technology Officer upon a cashless exercise of an option to purchase 50,000 shares of common stock at an exercise price of $0.27 per share based upon a market price of $0.42 per share as determined under the terms of the option. Between February 21, 2023 and February 23, 2023, the Company issued an aggregate of 29,022 shares of common stock to three employees and one former employee upon a cashless exercise of options to purchase an aggregate of 80,000 shares of common stock at an exercise price of $0.27 per share based upon market prices ranging from $0.42 to $0.43 per share as determined under the terms of the options. On March 8, 2023, and pursuant to an advisor agreement dated March 1, 2023 with a nonaffiliated third party, the Company granted a nonqualified stock option under the 2017 Plan to such third party to acquire 125,000 shares of the Company’s common stock at an exercise price of $0.40 per share, representing the fair market value of the common stock on the date of grant as determined under the 2017 Plan. Fifty percent of the option shall vest and become exercisable on September 1, 2023 and the remaining fifty percent shall vest and become exercisable on March 1, 2024. The option will expire five years after the date of grant. Based on a Black-Scholes valuation model, these options were valued at $30,029, in accordance with FASB ASC Topic 718. The fair value of the shares is being amortized to selling, general and administrative expenses within the Company’s condensed consolidated statements of operations over twelve months. The valuation assumptions included an expected duration of 2.9 years, volatility of 93.69%, discount rate of 4.71% and dividends of $0. On April 4, 2023, and pursuant to a consulting agreement effective April 1, 2023 with a nonaffiliated third party, the Company granted a nonqualified stock option under the 2017 Plan to such third party to acquire 250,000 shares of the Company’s common stock at an exercise price of $0.39 per share, representing the fair market value of the common stock on the date of grant as determined under the 2017 Plan. Fifty percent of the option shall vest and become exercisable on October 1, 2023 and the remaining fifty percent shall vest and become exercisable on April 1, 2024. The option will expire five years after the date of grant. Based on a Black-Scholes valuation model, these options were valued at $56,610, in accordance with FASB ASC Topic 718. The fair value of the shares is being amortized to selling, general and administrative expenses within the Company’s condensed consolidated statements of operations over twelve months. The valuation assumptions included an expected duration of 2.5 years, volatility of 97.78%, discount rate of 3.72% and dividends of $0. On May 26, 2023, a new director was appointed to the Board of Directors and was granted a nonqualified stock option to acquire 125,000 shares of the Company’s common stock exercisable at $0.41 per share, representing the fair market value of the common stock as of the date of grant. Fifty percent of the option shall vest and become exercisable on November 26, 2023 and the remaining fifty percent shall vest and become exercisable on May 26, 2024. The option will expire five years after the date of grant. Based on a Black-Scholes valuation model, these options were valued at $28,854, in accordance with FASB ASC Topic 718. The fair value of the shares is being amortized to selling, general and administrative expenses within the Company’s condensed consolidated statements of operations over twelve months. The valuation assumptions included an expected duration of 2.5 years, volatility of 93.07%, discount rate of 4.39% and dividends of $0. On June 5, 2023, the Company issued 1,629 shares of common stock to the Company’s Senior Vice President and Chief Technology Officer upon a cashless exercise of an option to purchase 6,875 shares of common stock at an exercise price of $0.29 per share based upon a market price of $0.38 per share as determined under the terms of the option. On June 6, 2023, the Company issued an aggregate of 3,426 shares of common stock to an employee upon a cashless exercise of options to purchase an aggregate of 7,655 shares of common stock at exercise prices ranging from $0.17 to $0.29 per share based upon a market price of $0.38 per share as determined under the terms of the options. On June 7, 2023, the Company issued 1,352 shares of common stock to a director upon a cashless exercise of an option to purchase 6,250 shares of common stock at an exercise price of $0.29 per share based upon a market price of $0.37 per share as determined under the terms of the option. On June 28, 2023, the Company issued (i) 5,213 shares of common stock to the Company’s Chief Executive Officer upon a cashless exercise of options to purchase an aggregate of 24,687 shares of common stock at exercise prices ranging from $0.21 to $0.29 per share based upon a market price of $0.30 per shares as determined under the terms of the options, (ii) 4,125 shares of common stock to the Company’s Senior Vice President and Chief Technology Officer upon a cashless exercise of an option to purchase 13,750 shares of common stock at an exercise price of $0.21 per share based upon a market price of $0.30 per share as determined under the terms of the option, and (iii) 1,875 shares of common stock to a director upon a cashless exercise of an option to purchase 6,250 shares of common stock at an exercise price of $0.21 per share based upon a market price of $0.30 per share as determined under the terms of the option. A summary of stock option activity is presented below: Weighted Weighted Average Average Remaining Aggregate Number of Exercise Contractual Intrinsic Shares Price Life (years) Value December 31, 2022 18,876,912 $ 0.50 2.31 246,666 Grants 500,000 0.40 Expirations (137,241 ) 0.26 Exercised (1,545,467 ) 0.25 June 30, 2023 17,694,204 $ 0.52 2.07 370,447 Options exercisable at: June 30, 2023 17,194,204 0.53 1.91 370,447 The aggregate intrinsic value in the table above represents the total intrinsic value, based on the Company’s closing stock price of $0.29 as of June 30, 2023, which would have been received by the option holders had all option holders exercised their options as of that date. Stock options exercised during the six months ended June 30, 2023 include 850,000 that were exercised for cash and 695,467 which were a cashless exercise. |
Warrants
Warrants | 6 Months Ended |
Jun. 30, 2023 | |
Warrants | |
Warrants | Note 11 - Warrants The Company utilized a Black-Scholes options pricing model to value warrants at the issuance date. This model requires the input of highly subjective assumptions such as the expected stock price volatility and the expected period until the warrants are exercised. When calculating the value of warrants issued, the Company uses a volatility factor, a risk-free interest rate and the life of the warrant for the exercise period. No warrants were exercised during the six months ended June 30, 2023 and 2022. The following is a summary of the Company’s warrant activity: Weighted Weighted Average Average Remaining Aggregate Number of Exercise Contractual Intrinsic Shares Price Life (years) Value December 31, 2022 3,285,000 $ 0.70 1.37 $ - Grants - - - - Expirations (435,000 ) (0.70 ) - - Exercised - - - - June 30, 2023 2,850,000 $ 0.70 1.01 $ - Warrants exercisable at: June 30, 2023 2,850,000 $ 0.70 1.01 $ - The following table summarizes information about common stock warrants outstanding at June 30, 2023: Outstanding and Exercisable Exercise Price Number Outstanding Weighted Average Remaining Contractual Life (years) Weighted Average Exercise Price $ 0.70 2,850,000 1.01 $ 0.70 $ 0.70 2,850,000 1.01 $ 0.70 |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2023 | |
Subsequent Events | |
Subsequent Events | Note 12 - Subsequent Events On July 3, 2023, the Board of Directors of the Company approved and adopted the Company’s Amended and Restated 2014 Equity Incentive Plan (the (the “2014 Plan”) and the Company’s Amended and Restated 2017 Equity Incentive Plan (the “2017 Plan”) which amended the Company’s previously adopted 2014 Equity Incentive Plan and 2017 Equity Incentive Plan. Such amendments were made in accordance with the requirements of the TSX-V. The 2014 Plan was first approved by the Board on January 10, 2014. The 2017 Plan replaced the 2014 Plan, which was terminated by the Board on April 28, 2017. As a result of such termination, no additional awards may be granted under the 2014 Plan but previously granted awards shall remain outstanding in accordance with their terms and conditions. There are 4,775,000 options and no other types of award outstanding under the 2014 Plan. The 2017 Plan was adopted by the Board on February 9, 2017. As amended by the Board on July 3, 2023, the maximum number of shares of common stock that may be issued under the 2017 Plan after July 3, 2023 is 14,078,459, and to the extent any award (or portion thereof) outstanding under the 2014 Plan expires, terminates or is cancelled, surrendered or forfeited for any reason on or after July 3, 2023, the shares of common stock subject to such award (or portion thereof) shall be added to and increase the foregoing limit, to a maximum of 4,775,000 additional shares of common stock. On July 6, 2023, the Company received final approval to list its shares of common stock on the TSX Venture Exchange (the “TSX-V”). The Company’s shares commenced trading on the TSX-V on July 10, 2023 under the symbol “MEEC”. On July 28, 2023, the Company issued (i) 8,007 shares of common stock to the Company’s Chief Executive Officer upon a cashless exercise of an option to purchase 16,458 shares of common stock at an exercise price of $0.17 per share based upon a volume weighted average price (“VWAP”) of $0.3311 per share as determined under the terms of the option, (ii) 6,690 shares of common stock to the Company’s Senior Vice President and Chief Technology Officer upon a cashless exercise of an option to purchase 13,750 shares of common stock at an exercise price of $0.17 per share based upon a VWAP of $0.3311 per share as determined under the terms of the option, and (iii) 3,041 shares of common stock to a director upon a cashless exercise of an option to purchase 6,250 shares of common stock at an exercise price of $0.17 per share based upon a VWAP of $0.3311 per share as determined under the terms of the option. |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2023 | |
Basis of Presentation and Summary of Significant Accounting Policies | |
Basis of Presentation | The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of Rule 8-03 of Regulation S-X promulgated by the United States Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, these financial statements do not include all of the information and footnotes required for complete financial statements and should be read in conjunction with the audited consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 filed on May 15, 2023, from which the accompanying condensed consolidated balance sheet dated December 31, 2022 was derived. In management’s opinion, the unaudited condensed consolidated financial statements reflect all adjustments necessary to present fairly the financial position as of June 30, 2023, and results of operations, changes in stockholders’ deficit and cash flows for all periods presented. The interim results presented are not necessarily indicative of results that can be expected for a full year. |
Principles of Consolidation | The condensed consolidated financial statements include the accounts of Midwest Energy Emissions Corp. and its wholly-owned subsidiaries, MES, Inc. and ME2C Sponsor LLC, and ME2C Acquisition Corp. which is 85% owned by ME2C Sponsor LLC (collectively, the “Company”). Intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates | The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, valuation of equity issuances and disclosures of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. The Company uses estimates in accounting for, among other items, profit share liability, revenue recognition, allowance for doubtful accounts, stock-based compensation, income tax provisions, excess and obsolete inventory reserve and impairment of intellectual property. Actual results could differ from those estimates. |
Recoverability of Long-Lived and Intangible Assets | Long-lived assets and certain identifiable intangibles held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Events relating to recoverability may include significant unfavorable changes in business conditions, recurring losses or a forecasted inability to achieve break-even operating results over an extended period. The Company evaluates the recoverability of long-lived assets based upon forecasted undiscounted cash flows. Should impairment in value be indicated, the carrying value of the long-lived and/or intangible assets would be adjusted, based on estimates of future discounted cash flows. The Company evaluated the recoverability of the carrying value of the Company’s property and equipment, right of use asset and intellectual property. No impairment charges were recognized for the three and six months ended June 30, 2023 and 2022. |
Fair Value of Financial Instruments | The fair value hierarchy has three levels based on the inputs used to determine fair value, which are as follows: ☐ Level 1 ☐ Level 2 ☐ Level 3 — The fair value hierarchy requires the use of observable market data when available. In instances where the inputs used to measure fair value fall into different levels of the fair value hierarchy, the fair value measurement has been determined based on the lowest level input significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular item to the fair value measurement in its entirety requires judgment, including the consideration of inputs specific to the asset or liability. Cash and profit share liability were the only asset and liability measured at fair value on a recurring basis by the Company at June 30, 2023 and December 31, 2022. Cash is considered to be Level 1 and profit share liability is considered to be Level 3. Financial instruments include cash, accounts receivable, accounts payable, and short-term debt. The carrying amounts of these financial instruments approximated fair value at June 30, 2023 and December 31, 2022 due to their short-term maturities. The fair value of the notes payable at June 30, 2023 and December 31, 2022 approximated the carrying amount as the notes were recently issued at interest rates prevailing in the market and interest rates as of June 30, 2023 and December 31, 2022. The fair value of the notes payable was determined on a Level 2 measurement. Discounts on issued debt, as well as debt issuance costs, are amortized over the term of the individual notes. The fair value of the profit share liability at June 30, 2023 and December 31, 2022 was calculated using a discounted cash flow model based on estimated future cash payments. The fair value of the profit share liability was determined on a Level 3 measurement. These values are determined using pricing models for which the assumptions utilized management’s estimates. The following tables present the Company’s liabilities that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy. Fair Value Measurement as of June 30, 2023 Total Level 1 Level 2 Level 3 Liabilities: Profit share liability – related party (1) $ 3,952,157 $ - $ - $ 3,952,157 Total Liabilities $ 3,952,157 $ - $ - $ 3,952,157 Fair Value Measurement as of December 31, 2022 Total Level 1 Level 2 Level 3 Liabilities: Profit share liability – related party (1) $ 3,638,260 $ - $ - $ 3,638,260 Total Liabilities $ 3,638,260 $ - $ - $ 3,638,260 (1) See Note 7 - Related Party |
Revenue Recognition | The Company records revenue in accordance with ASC 606, Revenue from Contracts with Customers Step 1: Identify the contract(s) with a customer. Step 2: Identify the performance obligations in the contract. Step 3: Determine the transaction price. Step 4: Allocate the transaction price to the performance obligations in the contract. Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation. Revenue is recognized when the Company satisfies its performance obligation under the contract by transferring the promised product to its customer that obtains control of the product. A performance obligation is a promise in a contract to transfer a distinct product to a customer. Most of the Company’s contracts have a single performance obligation, as the promise to transfer products or services is not separately identifiable from other promises in the contract and, therefore, not distinct. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring products. As such, revenue is recorded net of returns, allowances, customer discounts, and incentives. Sales and other taxes are excluded from revenues. Invoiced shipping and handling costs are included in revenue. |
Disaggregation of Revenue | The Company generated revenue for the three and six months ended June 30, 2023 and 2022 by (i) delivering product to its commercial customers, (ii) completing and commissioning equipment projects at commercial customer sites and (iii) performing demonstrations of its technology at customers with the intent of entering into long term supply agreements based on the performance of the Company’s products during the demonstrations and (iv) licensing its technology to customers. Revenue for product sales is recognized at the point of time in which the customer obtains control of the product, at the time title passes to the customer upon shipment or delivery of the product based on the applicable shipping terms. Revenue for equipment sales is recognized upon commissioning and customer acceptance of the installed equipment per the terms of the purchase contract. Revenue for demonstrations and consulting services is recognized when performance obligations contained in the contract have been completed, typically the completion of necessary field work and the delivery of any required analysis per the terms of the agreement. The following table presents sales by operating segment disaggregated based on the type of product for the three and six months ended June 30, 2023 and 2022. All sales were in the United States. For the Three Months Ended June 30, 2023 For the Three Months Ended June 30, 2022 Product revenue $ 3,914,711 $ 4,791,054 License revenue 163,125 163,125 Demonstrations & Consulting revenue 27,000 27,000 Equipment revenue 6,885 147,703 $ 4,111,721 $ 5,128,882 For the Six Months Ended June 30, 2023 For the Six Months Ended June 30, 2022 Product revenue $ 6,431,111 $ 7,989,356 License revenue 618,750 233,408 Demonstrations & Consulting revenue 54,000 54,000 Equipment revenue 20,608 193,703 $ 7,124,469 $ 8,470,467 |
Accounts receivable and allowance for doubtful accounts | Accounts receivable are presented net of an allowance for doubtful accounts. The Company maintains allowances for doubtful accounts for estimated losses. The Company reviews the accounts receivable on a periodic basis and makes general and specific allowances when there is doubt as to the collectability of individual balances. In evaluating the collectability of individual receivable balances, the Company considers many factors, including the age of the balance, a customer’s payment history, its current credit-worthiness and current economic trends. Accounts are written off after exhaustive efforts at collection. Management believed that the accounts receivable were fully collectable and no allowance for doubtful accounts was deemed to be required on its accounts receivable at June 30, 2023. The Company historically has not experienced significant uncollectible accounts receivable. As of June 30, 2023 and December 31, 2022, the Company’s allowance for doubtful accounts was $0. |
Income Taxes | The Company follows the asset and liability method of accounting for income taxes under FASB ASC 740, Income Taxes FASB ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. There were no unrecognized tax benefits as of June 30, 2023 and 2022. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is no longer subject to tax examinations by tax authorities for the years prior to 2018. The Company may be subject to potential examination by federal, state, and city taxing authorities in the areas of income taxes. These potential examinations may include questioning the timing and amount of deductions, the nexus of income among various tax jurisdictions, and compliance with federal, state, and city tax laws. Management does not expect that the total amount of unrecognized tax benefits will materially change over the next twelve months. |
Basic and Diluted Loss Per Common Share | Basic net loss per common share is calculated by dividing net loss by the weighted average number of shares outstanding during the period. Diluted loss per share is calculated by dividing net loss by the weighted-average number of common shares outstanding, after giving effect to all potentially dilutive common shares outstanding during the period. There were no dilutive potential common shares as of June 30, 2023 and 2022, because the Company incurred a net loss and basic and diluted losses per common share are the same. June 30, June 30, 2023 2022 Stock Options 17,694,204 19,108,576 Warrants 2,850,000 4,285,000 Total common stock equivalents excluded from basic and dilutive loss per share 20,544,204 23,393,576 Concentration of Credit Risk Financial instruments that subject the Company to credit risk consist of cash and equivalents on deposit with financial institutions and accounts receivable. The Company’s cash as of June 30, 2023 and December 31, 2022 is maintained at high-quality financial institutions and has not incurred any losses to date. Customer and Supplier Concentration For the six months ended June 30, 2023, three customers represented 28%, 19%, and 11% of the Company’s revenues, and for the six months ended June 30, 2022, four customers represented 16%, 16%, 13% and 11% of the Company’s revenues. At June 30, 2023, three customers represented 32%, 23% and 13% of the Company’s accounts receivable, and at June 30, 2022, four customers represented 25%, 18%, 12% and 11% of the Company’s accounts receivable. For the six months ended June 30, 2023, 87% of the Company’s purchases related to three suppliers. For the six months ended June 30, 2022, 92% of the Company’s purchases related to four suppliers. At June 30, 2023 and 2022, 74% and 57% of the Company’s accounts payable and accrued expenses related to two vendors, respectively. The Company believes there are numerous other suppliers that could be substituted should a supplier become unavailable or non-competitive. Contingencies Certain conditions may exist which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company’s management and its legal counsel assess such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company, or unasserted claims that may result in such proceedings, the Company’s legal counsel evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, the estimated liability would be accrued in the Company’s consolidated financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they arise from guarantees, in which case the guarantees would be disclosed. Recently Issued Accounting Standards Issued in June 2021, FASB Accounting Standards Update (ASU) No. 2016-13, Measurement of Credit Losses on Financial Instruments |
Concentration of Credit Risk | Financial instruments that subject the Company to credit risk consist of cash and equivalents on deposit with financial institutions and accounts receivable. The Company’s cash as of June 30, 2023 and December 31, 2022 is maintained at high-quality financial institutions and has not incurred any losses to date. |
Customer and Supplier Concentration | For the six months ended June 30, 2023, 87% of the Company’s purchases related to three suppliers. For the six months ended June 30, 2022, 92% of the Company’s purchases related to four suppliers. At June 30, 2023 and 2022, 74% and 57% of the Company’s accounts payable and accrued expenses related to two vendors, respectively. The Company believes there are numerous other suppliers that could be substituted should a supplier become unavailable or non-competitive. |
Contingencies | Certain conditions may exist which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company’s management and its legal counsel assess such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company, or unasserted claims that may result in such proceedings, the Company’s legal counsel evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, the estimated liability would be accrued in the Company’s consolidated financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they arise from guarantees, in which case the guarantees would be disclosed. |
Recently Issued Accounting Standards | Issued in June 2021, FASB Accounting Standards Update (ASU) No. 2016-13, Measurement of Credit Losses on Financial Instruments |
Basis of Presentation and Sum_3
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Basis of Presentation and Summary of Significant Accounting Policies | |
Schedule of fair value assets and liabilities measured on recurring basis | Fair Value Measurement as of June 30, 2023 Total Level 1 Level 2 Level 3 Liabilities: Profit share liability – related party (1) $ 3,952,157 $ - $ - $ 3,952,157 Total Liabilities $ 3,952,157 $ - $ - $ 3,952,157 Fair Value Measurement as of December 31, 2022 Total Level 1 Level 2 Level 3 Liabilities: Profit share liability – related party (1) $ 3,638,260 $ - $ - $ 3,638,260 Total Liabilities $ 3,638,260 $ - $ - $ 3,638,260 |
Schedule of sales by operating segment disaggregated | For the Three Months Ended June 30, 2023 For the Three Months Ended June 30, 2022 Product revenue $ 3,914,711 $ 4,791,054 License revenue 163,125 163,125 Demonstrations & Consulting revenue 27,000 27,000 Equipment revenue 6,885 147,703 $ 4,111,721 $ 5,128,882 For the Six Months Ended June 30, 2023 For the Six Months Ended June 30, 2022 Product revenue $ 6,431,111 $ 7,989,356 License revenue 618,750 233,408 Demonstrations & Consulting revenue 54,000 54,000 Equipment revenue 20,608 193,703 $ 7,124,469 $ 8,470,467 |
Schedule of earnings per share basic and diluted | June 30, June 30, 2023 2022 Stock Options 17,694,204 19,108,576 Warrants 2,850,000 4,285,000 Total common stock equivalents excluded from basic and dilutive loss per share 20,544,204 23,393,576 |
Inventory (Tables)
Inventory (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Inventory | |
Schedule of Inventory | June 30, December 31, 2023 2022 Raw Materials $ 391,179 $ 606,056 Spare Parts 40,322 90,374 Finished Goods 459,718 294,701 $ 891,219 $ 991,131 |
Property And Equipment Net (Tab
Property And Equipment Net (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Property and Equipment Net | |
Schedule of property and equipment | June 30, December 31, 2023 2022 Equipment & installation $ 1,095,140 $ 1,095,140 Trucking equipment 845,102 845,102 Office equipment, computer equipment and software 1,873 20,295 Total equipment 1,942,115 1,960,537 Less: accumulated depreciation (1,922,315 ) (1,939,652 ) Construction in process 1,807,707 1,807,707 Property and equipment, net $ 1,827,507 $ 1,828,592 |
Intellectual Property (Tables)
Intellectual Property (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Intellectual Property | |
Schedule of patent costs capitalized | June 30, December 31, 2023 2022 Licenses and patents $ 3,068,995 $ 3,068,995 Less: Accumulated amortization (1,261,698 ) (1,159,398 ) Intellectual property, net $ 1,807,297 $ 1,909,597 |
Related Party (Tables)
Related Party (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Related Party | |
Schedule of Unsecured notes payable related party outstanding | June 30, December 31, 2023 2022 Unsecured note payable $ 13,154,931 $ 13,154,931 Less fair value adjustment on extinguishment, net of amortized discount of $652,923 and $230,868, respectively (2,838,952 ) (3,491,875 ) Total unsecured note payable 10,315,979 9,663,056 Less current portion - - Unsecured note payable, net of current portion $ 10,315,979 $ 9,663,056 |
Schedule of profit share liabilities | Profit Share as of January 1, 2023 $ 3,638,260 Addition - Loss on change in fair value of profit share 313,897 Profit Share as of June 30, 2023 $ 3,952,157 Profit Share as of January 1, 2022 $ 2,836,743 Addition - Loss on change in fair value of profit share 307,417 Profit Share as of June 30, 2022 $ 3,144,160 |
Operating Leases (Tables)
Operating Leases (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Operating Leases | |
Schedule of operating lease right of use asset and liabilities | June 30, December 31, 2023 2022 Right of use asset - operating lease $ 31,504 $ 51,563 Current portion of operating lease liability 33,058 43,262 Operating lease liability - 11,289 |
Schedule of future minimum lease payments | For the twelve months ended June 30, 2023 $ 33,750 Total 33,750 Less discount (692 ) Total lease liabilities 33,058 Less current portion (33,058 ) Operating lease obligation, net of current portion $ - |
Schedule of lease cost | For the Six Months For the Six Months Ended Ended June 30, June 30, 2023 2022 Operating lease costs $ 20,059 $ 201,634 |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Stock Based Compensation | |
Schedule of stock option activity | Weighted Weighted Average Average Remaining Aggregate Number of Exercise Contractual Intrinsic Shares Price Life (years) Value December 31, 2022 18,876,912 $ 0.50 2.31 246,666 Grants 500,000 0.40 Expirations (137,241 ) 0.26 Exercised (1,545,467 ) 0.25 June 30, 2023 17,694,204 $ 0.52 2.07 370,447 Options exercisable at: June 30, 2023 17,194,204 0.53 1.91 370,447 |
Warrants (Tables)
Warrants (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Warrants | |
Schedule of warrant | Weighted Weighted Average Average Remaining Aggregate Number of Exercise Contractual Intrinsic Shares Price Life (years) Value December 31, 2022 3,285,000 $ 0.70 1.37 $ - Grants - - - - Expirations (435,000 ) (0.70 ) - - Exercised - - - - June 30, 2023 2,850,000 $ 0.70 1.01 $ - Warrants exercisable at: June 30, 2023 2,850,000 $ 0.70 1.01 $ - |
Summary of common stock warrants outstanding | Outstanding and Exercisable Exercise Price Number Outstanding Weighted Average Remaining Contractual Life (years) Weighted Average Exercise Price $ 0.70 2,850,000 1.01 $ 0.70 $ 0.70 2,850,000 1.01 $ 0.70 |
Organization (Details Narrative
Organization (Details Narrative) | 6 Months Ended |
Jun. 30, 2023 | |
Organization | |
Description of organization | Midwest Energy Emissions Corp. and owns 85% of ME2C Acquisition Corp. A decision was made in January 2023 to liquidate these entities. As such, as of December 31, 2022, the Company wrote off the assets for these entities and recorded a $95,500 loss |
Liquidity and Financial Condi_2
Liquidity and Financial Condition (Details Narrative) $ in Millions | 6 Months Ended |
Jun. 30, 2023 USD ($) | |
Liquidity and Financial Condition | |
Cash | $ 1.9 |
Cash provided by operating activities | 0.2 |
Working capital | 1.7 |
Accumulated deficit | (70.9) |
Principal amount | $ 13.4 |
Summary of Significant Accounti
Summary of Significant Accounting Policies (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Total Liabilities | $ 17,776,336 | $ 16,757,142 |
Fair Value, Inputs, Level 1 [Member] | ||
Profit share liability - related party | 0 | 0 |
Total Liabilities | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | ||
Profit share liability - related party | 0 | 0 |
Total Liabilities | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | ||
Profit share liability - related party | 3,952,157 | 3,638,260 |
Total Liabilities | 3,952,157 | 3,638,260 |
Common Stock | ||
Profit share liability - related party | 3,952,157 | 3,638,260 |
Total Liabilities | $ 3,952,157 | $ 3,638,260 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Details 1) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Total | $ 4,111,721 | $ 5,128,882 | $ 7,124,469 | $ 8,470,467 |
United States [Member] | ||||
Product revenue | 3,914,711 | 4,791,054 | 6,431,111 | 7,989,356 |
License revenue | 163,125 | 163,125 | 618,750 | 233,408 |
Demonstrations & Consulting revenue | 27,000 | 27,000 | 54,000 | 54,000 |
Equipment revenue | $ 6,885 | $ 147,703 | $ 20,608 | $ 193,703 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details 2) - shares | 3 Months Ended | 6 Months Ended |
Jun. 30, 2022 | Jun. 30, 2023 | |
Total common stock equivalents excluded from basic and dilutive loss per share | 23,393,576 | 20,544,204 |
Stock Options [Member] | ||
Total common stock equivalents excluded from basic and dilutive loss per share | 19,108,576 | 17,694,204 |
Warrant [Member] | ||
Total common stock equivalents excluded from basic and dilutive loss per share | 4,285,000 | 2,850,000 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Allowance for doubtful accounts | $ 0 | |
Three Suppliers [Member] | Purchase [Member] | ||
Concentration risk percentage | 87% | 92% |
Revenue [Member] | First Customer [Member] | ||
Concentration risk percentage | 28% | 16% |
Revenue [Member] | Second Customer [Member] | ||
Concentration risk percentage | 19% | 16% |
Revenue [Member] | Third Customer [Member] | ||
Concentration risk percentage | 11% | 13% |
Revenue [Member] | Fourth Customer [Member] | ||
Concentration risk percentage | 11% | |
Accounts Receivable [Member] | First Customer [Member] | ||
Concentration risk percentage | 32% | 25% |
Accounts Receivable [Member] | Second Customer [Member] | ||
Concentration risk percentage | 23% | 18% |
Accounts Receivable [Member] | Third Customer [Member] | ||
Concentration risk percentage | 13% | 12% |
Accounts Receivable [Member] | Fourth Customer [Member] | ||
Concentration risk percentage | 11% | |
Accounts Payable And Accrued Expenses [Member] | Two Vendors [Member] | ||
Concentration risk percentage | 74% | 57% |
Inventory (Details)
Inventory (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Inventory | ||
Raw materials | $ 391,179 | $ 606,056 |
Spare parts | 40,322 | 90,374 |
Finished goods | 459,718 | 294,701 |
Inventory total | $ 891,219 | $ 991,131 |
Property And Equipment Net (Det
Property And Equipment Net (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Total Equipment | $ 1,942,115 | $ 1,960,537 |
Less: accumulated depreciation | (1,922,315) | (1,939,652) |
Construction in process | 1,807,707 | 1,807,707 |
Property and equipment, net | 1,827,507 | 1,828,592 |
Trucking Equipment [Member] | ||
Total Equipment | 845,102 | 845,102 |
Office Equipment Computer Equipment and Software [Member] | ||
Total Equipment | 1,873 | 20,295 |
Equipment & Installation [Member] | ||
Total Equipment | $ 1,095,140 | $ 1,095,140 |
Property And Equipment Net (D_2
Property And Equipment Net (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Property and Equipment Net | ||||
Depreciation expense | $ 543 | $ 2,118 | $ 1,085 | $ 10,862 |
Straight-line method description | The Company uses the straight-line method of depreciation over estimated useful lives of 2 to 5 years |
Intellectual Property (Details)
Intellectual Property (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Intellectual Property | ||
Licenses and patents | $ 3,068,995 | $ 3,068,995 |
Less: Accumulated amortization | (1,261,698) | (1,159,398) |
Intellectual property, net | $ 1,807,297 | $ 1,909,597 |
Intellectual Property (Details
Intellectual Property (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Intellectual Property | ||||
Amortization expense charged to cost and expenses | $ 51,150 | $ 51,150 | $ 102,300 | $ 102,300 |
Estimated amortization cost for 2023 | 204,600 | 204,600 | ||
Estimated amortization cost for 2024 | 204,600 | 204,600 | ||
Estimated amortization cost for 2025 | 204,600 | 204,600 | ||
Estimated amortization cost for 2026 | 204,600 | 204,600 | ||
Estimated amortization cost for 2027 | $ 204,600 | $ 204,600 |
Related party (Details)
Related party (Details) - Note Payable Related Party [Member] - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Unsecured Note Payable | $ 13,154,931 | $ 13,154,931 |
Less fair value adjustment on extinguishment | (2,838,952) | (3,491,875) |
Total unsecured note payable | 10,315,979 | 9,663,056 |
Less current portion | 0 | 0 |
Unsecured note payable, net of current portion | $ 10,315,979 | $ 9,663,056 |
Related party (Details 1)
Related party (Details 1) - USD ($) | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Related party (Details) | ||
Profit Share, Beginning balance | $ 3,638,260 | $ 2,836,743 |
Addition | 0 | 0 |
Loss on change in fair value of profit share | 313,897 | 307,417 |
Profit Share, Ending balance | $ 3,952,157 | $ 3,144,160 |
Related party (Details Narrativ
Related party (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||||
Jan. 31, 2023 | Sep. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | Oct. 28, 2022 | Nov. 29, 2016 | |
Interest expenses | $ 328,265 | $ 462,483 | $ 652,923 | $ 919,884 | |||||
Interest expenses | 339,444 | 503,887 | 675,024 | 1,002,242 | |||||
Fair Value of sharing profit | 1,954,383 | ||||||||
Description of License and supply agreement | the Company shall pay Dakin a license fee of $12,500 per month for a three-year period commencing as of the effective date and pay Dakin a royalty on all sales in the United States of the products comprising the Dakin IP made by the Company | ||||||||
License fees | 75,000 | 75,000 | |||||||
Unamortized balance of discount | 2,838,952 | 2,838,952 | |||||||
Cash | 1,946,217 | 1,946,217 | $ 1,504,225 | ||||||
Proceeds from issuance of equity securities | 4,500,000 | ||||||||
Remaining debt discount | 662,594 | 919,884 | |||||||
Debt Repayment Agreement [Member] | |||||||||
Profit share valuation | 2,305,308 | ||||||||
Net proceeds | $ 12,000,000 | ||||||||
Profit share valuation adjusted | $ 4,026,568 | ||||||||
Kaye Cooper Kay & Rosenberg, LLP [Member] | |||||||||
Related party debt | 33,333 | $ 33,333 | 25,000 | ||||||
Legal services expense | $ 10,727 | 100,000 | 50,384 | 191,752 | 125,688 | ||||
MEEC [Member] | |||||||||
Fair Value of sharing profit | $ 488,274 | ||||||||
Interest rate | 21% | ||||||||
AC Midwest Subordinated Note [Member] | |||||||||
Interest expenses | 4,862 | 0 | $ 9,671 | 0 | |||||
Unamortized balance of discount | 42,053 | 42,053 | |||||||
Remaining debt discount | $ 6,916,687 | ||||||||
Market rate of interest | 21% | ||||||||
Short term deb [Member] | |||||||||
Interest expenses | $ 4,937 | ||||||||
Cash | 1,200,000 | $ 1,200,000 | |||||||
Interest rate | 6% | ||||||||
Promissory note | $ 250,000 | ||||||||
AC Midwest Unsecured Note [Member] | |||||||||
Fair Value of sharing profit | $ 3,234,469 | ||||||||
Principal outstanding on notes | $ 13,154,931 | ||||||||
Repayment of debt description | In connection with the AC Midwest Unsecured Note the Company shall pay the principal outstanding, as well as the Profit Share, in an amount equal to 60.0% of Net Litigation Proceeds until such time as any litigation funder has been paid in full and, thereafter, in an amount equal to 75.0% of such Net Litigation Proceeds until the Unsecured Note and Profit Share have been paid in full | ||||||||
AC Midwest Unsecured Note [Member] | AC Midwest [Member] | |||||||||
Principal outstanding on notes | 6,577,465 | $ 6,577,465 | |||||||
Percentages of remaining outstanding principal balance | 50% | ||||||||
Percentages of aggregate outstanding principal balance | 50% | ||||||||
Secured Note [Member] | |||||||||
Capital Contribution | 54,983 | ||||||||
Interest expenses | 6,180 | $ 10,301 | $ 12,294 | $ 20,490 | |||||
Interest rate | 15% | ||||||||
Principal outstanding on notes | $ 271,686 | $ 271,686 | $ 271,686 | $ 17,654,931 | $ 13,154,931 | ||||
Maturity Date | Aug. 25, 2022 |
Operating Leases (Details)
Operating Leases (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Operating Leases | ||
Right of use asset - operating lease | $ 31,504 | $ 51,563 |
Current portion of operating lease liability | 33,058 | 43,262 |
Operating lease liability | $ 0 | $ 11,289 |
Operating Leases (Details 1)
Operating Leases (Details 1) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Operating Leases | ||
2023 | $ 33,750 | |
Total | 33,750 | |
Less discount | (692) | |
Total lease liabilities | 33,058 | $ 43,262 |
Less current portion | (33,058) | |
Operating lease obligation, net of current portion | $ 0 | $ 11,289 |
Operating Leases (Details 2)
Operating Leases (Details 2) - USD ($) | 3 Months Ended | 6 Months Ended |
Jun. 30, 2022 | Jun. 30, 2023 | |
Operating Leases | ||
Operating lease cost | $ 201,634 | $ 20,059 |
Operating Leases (Details Narra
Operating Leases (Details Narrative) - USD ($) | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Weighted average discount rate | 5% | |
Lease obligations | 8 months 1 day | |
Payments on lease obligations | $ 22,500 | |
Operating lease liability | 20,059 | $ 201,634 |
Corsicana Warehouse [Member] | July 1, 2015 [Member] | ||
Operating lease liability | $ 145,267 | |
Lease term | five years | |
Monthly rent expenses | $ 3,750 | |
Monthly expenses pro rata basis | $ 882 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) | 1 Months Ended | 6 Months Ended |
Jul. 17, 2019 | Jun. 30, 2023 | |
Commercial Customers [Member] | ||
Contracts expiry date, description | These contracts expire between 2023 and 2025 and expose the Company to the potential risks associated with rising material costs during that same period | the Company initiated patent litigation against certain defendants in the U.S. District Court for the District of Delaware for infringement of certain United States patents owned by the Company |
Stock Based Compensation (Detai
Stock Based Compensation (Details) | 6 Months Ended |
Jun. 30, 2023 USD ($) $ / shares shares | |
Stock Based Compensation | |
Number of shares, Beginning balance | shares | 18,876,912 |
Number of shares, Grants | shares | 500,000 |
Number of shares, Expirations | shares | (137,241) |
Number of shares, Exercised | shares | (1,545,467) |
Number of shares, Ending balance | shares | 17,694,204 |
Options exercisable, Ending balance | shares | 17,194,204 |
Weighted Average Exercise Price, Beginning balance | $ / shares | $ 0.50 |
Weighted Average Exercise Price, Grants | $ / shares | 0.40 |
Weighted Average Exercise Price, Expirations | $ / shares | 0.26 |
Weighted Average Exercise Price, Exercised | $ / shares | 0.25 |
Weighted Average Exercise Price, Ending balance | $ / shares | 0.52 |
Weighted Average Exercise Price exercisable, Ending balance | $ / shares | $ 0.53 |
Weighted Average Remaining Contractual Life (years), Beginning balance | 2 years 3 months 21 days |
Weighted Average Remaining Contractual Life (years), Ending balance | 2 years 25 days |
Weighted Average Remaining Contractual Life exercisable, Ending balance | 1 year 10 months 28 days |
Aggregate Intrinsic Value, Beginning balance | $ | $ 246,666 |
Aggregate Intrinsic Value, Ending balance | $ | 370,447 |
Options exercisable, Ending balance, Intrinsic value | $ | $ 370,447 |
Stock Based Compensation (Det_2
Stock Based Compensation (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||||||||||||||
Jun. 07, 2023 | Jun. 06, 2023 | Jun. 05, 2023 | Apr. 04, 2023 | Mar. 08, 2023 | Feb. 02, 2023 | Feb. 02, 2022 | Jun. 28, 2023 | May 26, 2023 | Feb. 23, 2023 | Feb. 20, 2023 | May 31, 2022 | Jan. 24, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Feb. 01, 2023 | Dec. 31, 2022 | |
Stock options exercised for cash | 850,000 | ||||||||||||||||||
Stock options exercised for cashless | 695,467 | ||||||||||||||||||
Exercisable per share | $ 0.21 | ||||||||||||||||||
Option value | $ 143,745 | ||||||||||||||||||
Expected term | 2 years 6 months | ||||||||||||||||||
Volatility | 96.83% | ||||||||||||||||||
Discount rate | 2.62% | ||||||||||||||||||
Dividend | $ 0 | ||||||||||||||||||
Stock issued for services, amount | $ 0 | $ 160,000 | |||||||||||||||||
Common stock, shares issued | 94,267,296 | 94,267,296 | 93,087,796 | ||||||||||||||||
Stock based compensation expense | $ 158,414 | $ 268,536 | $ 320,306 | $ 450,283 | |||||||||||||||
Closing stock price | $ 0.29 | $ 0.29 | |||||||||||||||||
Minimum [Member] | |||||||||||||||||||
Market price per share | $ 0.42 | ||||||||||||||||||
Option exercise price per share | $ 0.17 | $ 0.20 | $ 0.21 | $ 0.19 | |||||||||||||||
Maximum [Member] | |||||||||||||||||||
Market price per share | $ 0.43 | ||||||||||||||||||
Option exercise price per share | $ 0.29 | $ 0.33 | $ 0.29 | $ 0.27 | |||||||||||||||
Jami Satterthwaite [Member] | |||||||||||||||||||
Option to purchase share | 100,000 | ||||||||||||||||||
Two Employees [Member] | |||||||||||||||||||
Option to purchase share | 50,000 | ||||||||||||||||||
February 2, 2022 [Member] | |||||||||||||||||||
Common stock, shares issued | 5,181 | ||||||||||||||||||
Stock issued for cashless exercise of stock options | 9,750 | ||||||||||||||||||
Closing stock price | $ 0.54 | ||||||||||||||||||
February 23 2023 [Member] | |||||||||||||||||||
Common stock, shares issued | 29,022 | ||||||||||||||||||
Exercise price | $ 0.27 | ||||||||||||||||||
Stock issued for cashless exercise of stock options96 | 80,000 | ||||||||||||||||||
January 24, 2022 [Member] | |||||||||||||||||||
Option expiry term | five years | ||||||||||||||||||
Acquire an aggregate of shares | 700,000 | ||||||||||||||||||
Description of equity incentive plan | exercisable at prices ranging from $1.15 to $1.20 per share | ||||||||||||||||||
Stock Option, valued | $ 138,623 | ||||||||||||||||||
June 6 2023 [Member] | |||||||||||||||||||
Common stock, shares issued | 3,426 | ||||||||||||||||||
Market price per share | $ 0.38 | ||||||||||||||||||
Stock issued for cashless exercise of stock options96 | 7,655 | ||||||||||||||||||
June 7 2023 [Member] | |||||||||||||||||||
Common stock, shares issued | 1,352 | ||||||||||||||||||
Stock issued for cashless exercise of stock options | 6,250 | ||||||||||||||||||
Exercise price | $ 0.29 | ||||||||||||||||||
Market price per share | $ 0.37 | ||||||||||||||||||
2017 Plan [Member] | |||||||||||||||||||
Option value | $ 56,610 | $ 30,029 | |||||||||||||||||
Expected term | 2 years 6 months | 2 years 10 months 24 days | |||||||||||||||||
Volatility | 97.78% | 93.69% | |||||||||||||||||
Discount rate | 3.72% | 4.71% | |||||||||||||||||
Dividend | $ 0 | $ 0 | |||||||||||||||||
Option to purchase share | 125,000 | ||||||||||||||||||
Exercise price | $ 0.39 | $ 0.40 | |||||||||||||||||
Option expiry term | five years | five years | |||||||||||||||||
Cheif Executive Officer [Member] | |||||||||||||||||||
Recorded expense | $ 121,333 | $ 241,333 | |||||||||||||||||
Stock issued for conversion of convertible notes, shares | 3,000,000 | ||||||||||||||||||
Stock issued for services, amount | $ 960,000 | ||||||||||||||||||
Common stock, shares issued | 110,000 | ||||||||||||||||||
Stock issued for cashless exercise of stock options | 250,000 | ||||||||||||||||||
Exercise price | $ 0.28 | ||||||||||||||||||
Market price per share | $ 0.50 | ||||||||||||||||||
Cheif Executive Officer [Member] | June 28 2023 [Member] | |||||||||||||||||||
Common stock, shares issued | 5,213 | ||||||||||||||||||
Stock issued for cashless exercise of stock options | 24,687 | ||||||||||||||||||
Market price per share | $ 0.30 | ||||||||||||||||||
Consulting Agreement [Member] | |||||||||||||||||||
Stock issued for conversion of convertible notes, shares | 500,000 | ||||||||||||||||||
Stock issued for services, amount | $ 160,000 | ||||||||||||||||||
Two Director [Member] | |||||||||||||||||||
Stock issued for conversion of convertible notes, shares | 250,000 | ||||||||||||||||||
Stock issued for services, amount | $ 55,000 | ||||||||||||||||||
Chairman Of The Board [Member] | |||||||||||||||||||
Common stock, shares issued | 850,000 | ||||||||||||||||||
Stock issued for cashless exercise of stock options | 850,000 | ||||||||||||||||||
Aggregate amount | $ 209,500 | ||||||||||||||||||
Director [Member] | |||||||||||||||||||
Common stock, shares issued | 1,875 | 155,000 | |||||||||||||||||
Stock issued for cashless exercise of stock options | 250,000 | 6,250 | |||||||||||||||||
Exercise price | $ 0.21 | $ 0.19 | |||||||||||||||||
Market price per share | $ 0.30 | $ 0.50 | |||||||||||||||||
Vice President And Chief Technology Officer [Member] | |||||||||||||||||||
Common stock, shares issued | 1,629 | 4,125 | 17,858 | ||||||||||||||||
Stock issued for cashless exercise of stock options | 6,875 | 13,750 | 50,000 | ||||||||||||||||
Exercise price | $ 0.29 | $ 0.21 | $ 0.27 | ||||||||||||||||
Market price per share | $ 0.38 | $ 0.30 | $ 0.42 | ||||||||||||||||
James Trettel [Member] | John Pavlish [Member] | |||||||||||||||||||
Option to purchase share | 500,000 | ||||||||||||||||||
Board Of Directors [Member] | |||||||||||||||||||
Option value | $ 28,854 | ||||||||||||||||||
Expected term | 2 years 6 months | ||||||||||||||||||
Volatility | 93.07% | ||||||||||||||||||
Discount rate | 4.39% | ||||||||||||||||||
Dividend | $ 0 | ||||||||||||||||||
Option to purchase share | 125,000 | ||||||||||||||||||
Exercise price | $ 0.41 | ||||||||||||||||||
Option expiry term | five years |
Warrants (Details)
Warrants (Details) | 6 Months Ended |
Jun. 30, 2023 USD ($) $ / shares shares | |
Number of shares, Beginning balance | shares | 18,876,912 |
Number of shares, Ending balance | shares | 17,694,204 |
Warrant [Member] | |
Number of shares, Beginning balance | shares | 3,285,000 |
Weighted Average Exercise Price, Beginning balance | $ 0.70 |
Weighted Average Exercise Price, Grants | 0 |
Number of Shares, Grants | $ 0 |
Number of shares, Ending balance | shares | 2,850,000 |
Number of Shares, Expirations | shares | (435,000) |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Number | shares | 2,850,000 |
Number of Shares, Exercised | $ 0 |
Weighted Average Exercise Price, Expirations | (0.70) |
Weighted Average Exercise Price, Exercised | 0 |
Weighted Average Exercise Price, Ending balance | 0.70 |
Weighted Average Exercise Price, Exercisable | $ 0.70 |
Weighted Average Remaining Contractual Life years, Beginning Balance | 1 year 4 months 13 days |
Weighted Average Remaining Contractual Life years, Ending Balance | 1 year 3 days |
Weighted Average Remaining Contractual Life years, Exercisable | 1 year 3 days |
Aggregate Intrinsic Value, Beginning balance | $ | $ 0 |
Aggregate Intrinsic Value, Grants | $ | 0 |
Aggregate Intrinsic Value, Expirations | $ | 0 |
Aggregate Intrinsic Value, Exercised | $ | 0 |
Aggregate Intrinsic Value, Exercisable | $ | 0 |
Aggregate Intrinsic Value, Ending balance | $ | $ 0 |
Warrants (Details 1)
Warrants (Details 1) | 6 Months Ended |
Jun. 30, 2023 $ / shares shares | |
Warrant [Member] | |
Number outstanding | shares | 2,850,000 |
Weighted Average Exercise Price Outstanding | $ 0.70 |
Weighted Average Remaining Contractua Life (years) | 1 year 3 days |
Exercise Price | $ 0.70 |
Warrant One [Member] | |
Number outstanding | shares | 2,850,000 |
Weighted Average Exercise Price Outstanding | $ 0.70 |
Weighted Average Remaining Contractua Life (years) | 1 year 3 days |
Exercise Price | $ 0.70 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - $ / shares | 1 Months Ended | |||
Jul. 03, 2023 | Jul. 28, 2023 | Jun. 30, 2023 | Dec. 31, 2022 | |
Common stock shares outstanding | 94,267,296 | 93,087,796 | ||
Common stock Exercise Price | $ 0.001 | $ 0.001 | ||
Common stock, shares issued | 94,267,296 | 93,087,796 | ||
Chief Executive Officer Officer [Member] | ||||
Common stock Exercise Price | $ 0.17 | |||
Common stock, shares issued | 16,458 | |||
Stock issued for cashless exercise of stock options | 8,007 | |||
Subsequent Event [Member] | Minimum [Member] | ||||
Common stock Exercise Price | $ 0.3311 | |||
Common stock, shares issued | 3,041 | |||
Market value price | $ 0.17 | |||
Subsequent Event [Member] | Maximum [Member] | ||||
Common stock Exercise Price | $ 0.3311 | |||
Common stock, shares issued | 6,250 | |||
Market value price | $ 0.17 | |||
Subsequent Event [Member] | Senior Vice President And Chief Technology Officer [Member] | ||||
Common stock Exercise Price | $ 0.3311 | |||
Common stock, shares issued | 6,690 | |||
Stock issued for cashless exercise of stock options | 13,750 | |||
Board Of Director [Member] | Subsequent Event [Member] | ||||
Acquire an aggregate shares of common stock | 14,078,459 | |||
Common stock shares outstanding | 4,775,000 | |||
Additonal shares of common stock | 4,775,000 |