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STOCKHOLDERS’ EQUITY
 9 Months Ended
Sep. 30, 2026
Equity [Abstract]  
STOCKHOLDERS’ EQUITY

NOTE 5 – STOCKHOLDERS’ EQUITY

 

The Company’s authorized capital stock consists of 105,000,000 shares, comprised of 100,000,000 shares of common stock, per share par value $0.0001, and 5,000,000 shares of preferred stock, per share par value $0.0001.

 

Of the 5,000,000 shares of preferred stock authorized, the Board of Directors has designated the following:

 

  · 1,500,000 shares as Series AA Preferred Stock, none outstanding
  · 1,250,000 shares as Series AAA Preferred Stock, 31,413 shares outstanding
  · 1,250 shares as Series AAAA Preferred Stock, none outstanding
  · 1,500 shares as Series C Preferred Stock, none outstanding
  · 2 shares as Series B Preferred Stock: none outstanding
  · 70,000 shares as Series E Preferred Stock, 61,688 shares outstanding
  · One share of Series F Preferred Stock, none outstanding
  · 300,789 shares of Series G Preferred Stock, none outstanding
  · 770,000 shares of Series H Preferred Stock, none outstanding

 

Rights Under Preferred Stock

 

The Company’s classes of preferred stock include the following provisions:

 

Optional Conversion Rights of Preferred Stock

 

  · Series AA – one share convertible into 3.33 shares of common stock
  · Series AAA – one share convertible into 0.0167 shares of common stock
  · Series C – one share convertible into 6,667 shares of common stock
  · Series E – one share convertible into 0.0167 shares of common stock (calculated by taking one share at a rate of its Stated Value, as defined, divided by $0.08, convertible commencing January 31, 2020, and further adjusted by dividing the result by 6,000 representing the aggregate amount of two reverse stock splits)
  · Series G – one share convertible into shares of common stock at a rate of its Stated Value divided by $0.50 (Series G Conversion Ratio)
  · Series H – one share was convertible into shares of common stock at a rate of its Stated Value ($2.00 at August 7, 2024, date of mandatory conversion discussed below) divided by $0.20 (Series H Conversion Ratio)

 

Issuance of Common Stock for Services

 

During the year ended December 31, 2025, the Company entered into several consulting agreements with unrelated entities for business development and general business consulting services (Consulting Agreements). The terms of the Consulting Agreements ranged from three to twelve months. Compensation under the Consulting Agreements consisted of cash payments as well as common stock shares and warrant issuances. Any cash paid in advance, along with the fair value of any common stock shares and warrants issued, is recorded as a prepaid asset and amortized through professional fees expense (for cash compensation) or stock-based compensation expense (for stock-based instruments issued).

 

During 2025, common stock shares issued under the Consulting Agreements totaled 480,000 and warrant shares issued totaled 130,000. The fair value of the common shares issued totaled approximately $1,219,000 and the fair value of the warrants issued totaled approximately $191,000. The exercise price of the warrants was $1.00 per share and are exercisable over periods ranging from three to five years. Compensation expense recognized under these Consulting Agreements for the three and nine months ended September 30, 2025, was approximately $274,000 and $776,000, respectively. Compensation recognized for the three and nine months ended September 30, 2026, was approximately $0 and $197,000, respectively. No unamortized compensation remains outstanding at September 30, 2026. A total of 400,000 warrant shares related to the Consulting Agreements remain outstanding at September 30, 2026, and December 31, 2025.

 

Effective January 23, 2026, the Company entered into a Business Development Agreement with a third-party consultant, with a service term of eleven months. Compensation under the agreement consisted of 150,000 shares of the Company’s common stock issued and valued at the effective date of the agreement. The total fair value of the common stock issued was $133,500, based on a per share price of $0.89. The Company recognized approximately $36,000 and $97,000 in compensation expense for the three and nine months ended September 30, 2026, respectively, associated with the amortization of the common stock fair value.

 

Effective May 1, 2026, the Company entered into a Consulting Agreement with a third-party consultant, with a service term of six months. Compensation under the agreement included an up-front cash payment of $20,000 and monthly cash payments during the term of the agreement. Upon the effective date of the Consulting Agreement, the Company also issued 70,000 shares of the Company’s restricted common stock, fair valued at $92,400, and warrants for the purchase of 120,000 shares of common stock at an exercise price of $0.50 per share, fair valued at $152,760 using the Black-Scholes pricing model. For the three and nine months ended September 30, 2026, the Company recognized approximately $123,000 and $204,000 in stock-based compensation and $10,000 and $17,000 in professional fees expense, respectively, under the agreement.

 

On August 12, 2026, the Company entered into a Consulting Services Agreement with an unrelated consultant. The consultant is to provide general business development services for a term of six months from the date of the agreement. Compensation under the agreement consisted of the issuance of 1,200,000 shares of the Company’s restricted common stock, fair valued at $972,000, and warrants to purchase 1,500,000 shares of restricted common stock over a three-year period at an exercise price of $0.50 per share, fair valued at $996,000 using the Black-Scholes pricing model. For the three and nine months ended September 30, 2026, the Company recognized approximately $1,968,000 in non-cash stock-based compensation under the agreement.

 

Issuance of Common Stock in Conjunction with Debt Issuances and Conversions

 

As discussed in Note 4, during the nine months ended September 30, 2026, the Company issued a total of 1,455,000 shares of its common stock, at a total value of $1,390,000, resulting from conversion of outstanding debt principal. The Company also issued a total of 22,852 shares of its common stock at a total value of $21,447 as debt discount associated with debt issuances during the nine months ended September 30, 2026. Exemption from registration is claimed under Section 4(2). Section 3(a)(9) and Rule 506 of the Securities Act of 1933, as amended. No commissions were paid with respect to the aforementioned securities transactions.

 

2026 Issuances of Common Stock for Cash

 

During the nine months ended September 30, 2026, the Company issued a total of 6,064,000 shares of its common stock, at per share prices ranging from $0.50 to $1.03, for total net cash proceeds of approximately $3,423,000. During the three months ended September 30, 2026, the Company issued a total of 1,764,000 shares of its common stock, for total net cash proceeds of $882,000.