|9 Months Ended|
Sep. 30, 2021
|Stockholders' Equity Note [Abstract]|
NOTE 5 – STOCKHOLDERS’ EQUITY
The Company is authorized to issue an aggregate of 500,000,000 shares. The authorized capital stock is divided into: (i) 495,000,000 shares of common stock having a par value of $0.0001 per share and (ii) 5,000,000 shares of preferred stock having a par value of $0.0001 per share.
Effective April 8, 2021, we amended our certificate of incorporation to effect a 1-for-20 reverse stock split of our outstanding shares of Common Stock. No fractional shares were issued as a result of the reverse stock split. Any fractional shares resulting from the reverse stock split were paid in cash. The reverse stock split did not otherwise affect any of the rights currently accruing to holders of our common stock. All share information presented in these financial statements has been retroactively adjusted to reflect the reduced number of shares outstanding.
From inception, May 12, 2020, through December 31, 2020, the Company issued 7,300,000 shares of common stock at a price of $0.002 per share for cash proceeds of $14,600. Additionally, the Company issued 156,250 shares of common stock at a price of $1.60 per share for cash proceeds of approximately of $247,139, net of share issuance costs of $2,861, with gross proceeds of $33,000 received as of September 30, 2020 for an aggregate of 20,625 shares, and the remaining net proceeds of $214,139 received during the three months ended December 31, 2020.
In 2020, several investors advanced funds totaling approximately $20,600 to the Company with no specific terms of repayment, interest or maturity, subsequent to which the parties executed conversion documents to convert the funds into common shares. As the fair value of the equity instruments was equal to the funds advanced, there was no gain or loss on the transaction when on December 30, 2020, the Company issued 12,875 shares of common stock at a price of $0.08 per share to the respective investors.
During the first quarter of 2021, the Company entered into various subscription agreements in connection with a private placement seeking to raise up to $1 million through the sale of 625,000 shares of the Company’s common stock, at a price of $1.60 per share, with a closing date for accepted subscriptions of January 31, 2021. During the first quarter of 2021, the Company issued a total of 395,625 shares for aggregate proceeds received of approximately $633,000 related to such private placement.
In 2021, the Company entered into various subscription agreements in connection with a second private placement seeking to raise up to $5 million through the sale of 2,083,333 shares of the Company’s common stock, at a price of $2.40 per share, with a closing date for accepted subscriptions of March 31, 2021. During the first quarter of 2021, the Company issued a total of 239,969 shares for aggregate proceeds received of approximately $576,000 related to such second private placement.
During the nine months ended September 30, 2021, the Company issued an additional 153,652 shares of common stock to existing investors related to an administrative correction, with no significant effect on the Company’s financial statements.
Brio Financial Group
On April 13, 2021, the Company entered into an agreement with Brio Financial Group, LLC (“Brio”) pursuant to which Brio will provide Stanley M. Gloss to serve as the Chief Financial Officer of the Company and also provide certain other specified financial and accounting services typically provided by a Chief Financial Officer (the “Brio Agreement”), which are described more fully in the Brio Agreement (the “CFO Services”). The term of the Brio Agreement will run through March 31, 2022, unless terminated by either party upon 10 days prior written notice to the other party, pursuant to the terms of the Brio Agreement. The Company will pay a monthly fixed fee of $7,500 for the CFO Services during the term of the Brio Agreement. In addition, 25,000 restricted shares of the Company’s common stock were issued to Brio fully vesting over the 1 year term of the Brio Agreement. Furthermore, the Company issued Stanley M. Gloss stock options to purchase up to 100,000 shares of the Company’s Common Stock, which options vested fully upon execution of the Brio Agreement and shall be exercisable at a price equal to the public price of the Company’s Common Stock sold in its Initial Public Offering.
The fair value of the 25,000 restricted shares of common stock granted of approximately $60,000 is being amortized over the 1 year term of the Brio Agreement. The total compensation expense was $30,000 for the nine months ended September 30, 2021, with unamortized expense remaining of $30,000 as of September 30, 2021.
The fair value of the 100,000 fully-vested stock options granted of approximately $284,665 was expensed in full during the nine months ended September 30, 2021. The fair value of was determined by the Black-Scholes Pricing Model with the following assumptions: dividend yield of 0%, term of 10 years, volatility of 47.07%, and risk-free rate of 1.29%.
On September 18, 2021, the Company entered into a services agreement with TraDigital Marketing Group (“TraDigital”) pursuant to which TraDigital will provide consulting services from September 18, 2021 through December 17, 2021 (the “Services Agreement”). The Services Agreement includes a prepaid cash consulting fee of $394,000, payable and paid upon the agreement date, of which the Company expensed a total of $32,533 as selling, general and administrative expense for the three and nine months ended September 30, 2021, with the remaining unamortized amount of $361,467 included in prepaid expenses as of September 30, 2021.
The Services Agreement also includes 150,000 common shares of the Company due and earned upon the agreement date of September 18, 2021. The aggregate fair value of the 150,000 common shares of $750,000 and was recorded as shares issued for services, which is included in selling, general and administrative expense for the three and nine months ended September 30, 2021.
The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef