STOCKHOLDERS’ DEFICIT |
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STOCKHOLDERS’ DEFICIT |
NOTE 7 – STOCKHOLDERS’ DEFICIT
Preferred stock
The Company is authorized to issue shares of $ par value preferred stock as of December 31, 2021 and December 31, 2020. As of December 31, 2021, and 2020, the Company has designated and issued shares of Class A Preferred Stock.
Each share of Class A Preferred Stock is entitled to 100 votes on all matters submitted to a vote to the stockholders of the Company, does not have conversion, dividend or distribution upon liquidation rights. On November 9, 2020, the Company issued shares of its Class B Preferred Common Stock to Jesus Quintero. The Class B Preferred Stock carries a voting preference of One Thousand (1,000) times that number of votes on all matters submitted to the shareholders that is equal to the number of shares of Common Stock (rounded to the nearest whole number), at the record date for the determination of the shareholders entitled to vote on such matters or, if no such record date is established, at the date such vote is taken or any written consent of such shareholders is affected. The issuance constitutes a change of control of the Company, as the voting preference of the issued Class B Preferred Stock provides Mr. Quintero with the right to control a majority of the votes of shareholders eligible to cast votes on any matter brought before the stockholders. The Class B shares were valued at $ and recognized as stock-based compensation expense during the year ended December 31, 2020. As of December 31, 2021 and 2020, there were shares of Class B Preferred Stock outstanding. The Class B Preferred Stock is not convertible into common shares.
Common stock
The Company was authorized to issue 22,000,000,000 shares of $ par value per share common stock as of December 31, 2021. As of December 31, 2021, and 2020, the Company had and , respectively, common shares issued and outstanding. As of February 4, 2022, we reduced the par value of our common stock from $0.001 per share to zero par value ($0.00) per share.
In 2021, the Company issued an aggregate of 661,292. shares of its common stock for services rendered with an estimated fair value of $
In 2021, the Company issued an aggregate of 2,309,874. shares of its common stock in settlement of convertible notes payable and accrued interest with an estimated fair value of $
In 2021, the Company issued an aggregate of 141,750. shares of its common stock in conversion of related party notes payable with an estimated fair value of $
In 2021, the Company issued an aggregate of common shares of its common stock in exchange for exercise of warrants on a cashless basis.
In 2021, the Company sold shares of its common stock with a value of $ .
In 2021, the Company issued 8,623 to settle liabilities. shares of its common stock with an estimated value of $
In 2021, the Company issued 1,300,000. shares of common stock for investments with an estimated value of $
In 2021, the Company issued 1,617,501. shares of common stock issued for acquisition of business with an estimated value of $
In 2021, the Company issued 251,008. shares for amendment to an acquisition consideration with an estimated value of $
In 2020, the Company issued an aggregate of 785,861. shares of its common stock for services rendered with an estimated fair value of $
In 2020, the Company issued an aggregate of 3,916,940. shares of its common stock in settlement of convertible notes payable and accrued interest with an estimated fair value of $
In 2020, the Company issued an aggregate of 50,000. shares of its common stock in conversion of related party notes payable with an estimated fair value of $
In 2020, the Company issued an aggregate of common shares of its common stock in exchange for exercise of warrants on a cashless basis.
In 2020, the Company issued 762,723 to settle liabilities. shares of its common stock with an estimated value of $
In 2020, the Company sold shares shares of its common stock for proceeds of $ .
Options
Option valuation models require the input of highly subjective assumptions. The fair value of stock-based payment awards was estimated using the Binomial Option Pricing Model with a volatility figure derived from using the Company’s historical stock prices. Management determined this assumption to be a more accurate indicator of value. The Company accounts for the expected life of options based on the contractual life of options for non-employees. For employees, the Company accounts for the expected life of options in accordance with the “simplified” method, which is used for “plain-vanilla" options, as defined in the accounting standards codification.
The risk-free interest rate was determined from the implied yields of U.S. Treasury zero-coupon bonds with a remaining life consistent with the expected term of the options.
In addition, the Company is required to estimate the expected forfeiture rate and only recognize expense for those shares expected to vest. In estimating the Company’s forfeiture rate, the Company analyzed its historical forfeiture rate, the remaining lives of unvested options, and the number of vested options as a percentage of total options outstanding. If the Company’s actual forfeiture rate is materially different from its estimate, or if the Company reevaluates the forfeiture rate in the future, the stock-based compensation expense could be significantly different from what the Company has recorded in the current period.
The following table summarizes the stock option activity for the years ended December 31, 2021 and 2020:
The aggregate intrinsic value in the preceding table represents the total pretax intrinsic value, based on options with an exercise price less than the Company’s stock price of $0 and $0 as of December 31, 2021 and 2020, respectively, which would have been received by the option holders had those option holders exercised their options as of that date.
Warrants
The following table summarizes the stock warrant activity for the two years ended December 31, 2021:
Certain warrants issued to debt holders have reset provisions whereby upon subsequent issuances of common stock at a price below the current exercise price, the number of warrants increase and the exercise price is reduced to the new price. The aggregate intrinsic value in the preceding tables represents the total pretax intrinsic value, based on warrants with an exercise price less than the Company’s stock price of $ and $ as of December 31, 2021 and 2020, respectively, which would have been received by the warrant holders had those option holders exercised their warrants as of that date.
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