Annual report [Section 13 and 15(d), not S-K Item 405]

STOCKHOLDERS??? OPTIONS

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STOCKHOLDERS’ OPTIONS
 12 Months Ended
Dec. 31, 2024
Share-Based Payment Arrangement [Abstract]  
STOCKHOLDERS’ OPTIONS

NOTE 11 – STOCKHOLDERS’ OPTIONS

 

On November 27, 2023, the Board approved the 2023 Equity Incentive Plan (the “Equity Plan”). The Equity Plan provides for the grant of incentive stock options, nonqualified stock options, restricted stock awards, restricted stock unit awards, and other stock-based awards, collectively, the “Stock Awards”. Stock Awards may be granted under the Equity Plan to the Company’s, and its subsidiaries’, employees, officers, directors and consultants. The maximum number of shares of Class A common stock available for issuance under the Equity Plan is 100,000,000 shares.

 

On January 1, 2024, the Company entered into agreements with employees and consultants for services to be performed. As consideration therefore, the Company granted stock options (the “Options”) under the Company’s Equity Plan to purchase up to 4,660,000 shares of Class A common stock.

 

On May 16, 2024, the Company entered into agreements with three employees and a consultant for services to be performed pursuant to which the Company granted Options under the Company’s Equity Plan to purchase up to an aggregate of 390,000 shares of Class A common stock.

 

Options were valued using the Black-Scholes option pricing model under the following assumptions as found in the table below. There were no stock options issued or outstanding for the year ended December 31, 2023.

 

Date   Number of Stock Options     Stock Price1     Strike Price     Expected Volatility     Interest Rate     Dividend Rate     Expected Term (years)2     Fair Value  
1/1/2024     4,660,000     $ 0.19     $ 0.17       134.97 %     4.00 %     0.00 %     4.0     $ 731,548  
05/16/2024     390,000     $ 0.11     $ 0.11       135.44 %     4.49 %     0.00 %     4.0     $ 30,616  

 

  1 Grant exercise price is based on the prior trading day’s closing price of $0.164 on December 29, 2024 and $0.11 on May 15, 2024.
  2 Options granted vest over various time periods ranging from two to four years with the majority vesting over a four-year term.

 

A summary of the status of the Company’s outstanding stock options and changes during the periods is presented below:

 

    Shares available to     Weighted Average     Weighted Average Remaining Contractual     Aggregate  
    purchase
with options		     Exercise
Price		     Term
(in years)		     Intrinsic
Value		  
Outstanding, December 31, 2023     -     $ -       -     $ -  
Issued     5,050,000       0.17       9.04          
Exercised     -       -       -       -  
Cancelled/Forfeited     (1,410,000 )     0.17       -       -  
Expired     -       -       -       -  
Outstanding, December 31, 2024     4,760,000     $ 0.17       9.26     $ -  
                                 
Exercisable, December 31, 2024     876,036     $ 0.17       9.26     $ -  

 

The compensation expense attributed to the issuance of stock options is recognized as the options vest; total compensation expense related to options was $168,818 for the year ended December 31, 2024 and was included in compensation expense on the statement of operations. As of December 31, 2024, there was $562,112 in future compensation cost related to non-vested stock options.

 

As of December 31, 2024, the aggregate intrinsic value for total outstanding and exercisable options is zero; such is based on our estimated fair value of the common stock of $0.06 had all option holders exercised their options as of that date, net of the aggregate exercise price.