7. STOCK OPTIONS

Stock options issued during the three months ended June 30, 2026 and the three months ended June 30, 2025

During the three months ended June 30, 2026, the Company granted options to a strategic advisor to purchase 300,000 shares of the Company’s common stock with an exercise price of $0.36 per share that expire ten years from the date of grant. The options vested upon grant. The fair value of the option award was estimated on the date of grant using the Black-Scholes-Merton Option Pricing model based on the following assumptions: (i) volatility rate of 251.86%, (ii) discount rate of 4.6%, (iii) zero expected dividend yield, and (iv) expected life of 10 years, which is the term of the options. The total fair value of the option grant at its grant date was approximately $108,000 which was allocated to general and administrative expenses during the three months ended June 30, 2026.

Additionally, a director exercised a stock option for 250,000 shares at the strike price of $0.15 during the three months ended June 30, 2026. Cash received from the exercise was $37,500, and at the time of the exercise, the options held an intrinsic value of $52,500.

During the three months ended June 30, 2025, the Company granted options to an officer and two directors to purchase 250,000 shares (each) of the Company’s common stock with an exercise price of $0.148 per share that expire ten years from the date of grant. All options vested upon grant. The fair value of the option award was estimated on the date of grant using the Black-Scholes-Merton Option Pricing model based on the following assumptions: (i) volatility rate of 259.90%, (ii) discount rate of 3.75%, (iii) zero expected dividend yield, and (iv) expected life of 10 years, which is the term of the options. The total fair value of the option grants at their grant dates was approximately $37,500 each, for a total of $112,500 which was allocated to general and administrative expenses during the three months ended June 30, 2025. In addition to the expense recorded for the new option awards, there was $51,990 recorded for amortized stock-based awards during the three months ended June 30, 2025.

A summary of the Company’s stock option activity during the six months ended June 30, 2026 is as follows:

 SCHEDULE OF STOCK OPTION ACTIVITY

At June 30, 2026, the 13,235,876 outstanding stock options had $2,640,480 of intrinsic value.

A summary of the Company’s stock options outstanding and exercisable as of June 30, 2026 is as follows:

 SCHEDULE OF STOCK OPTION OUTSTANDING