Quarterly report pursuant to Section 13 or 15(d)

STOCK OPTIONS AND WARRANTS (Tables)

v3.20.4
STOCK OPTIONS AND WARRANTS (Tables)
 9 Months Ended
Sep. 30, 2020
Disclosure Text Block [Abstract]  
Summary of option award activity and awards outstanding

A summary of the option award activity in 2020 and awards outstanding at September 30, 2020 is as follows:

 

            Weighted    
        Weighted   Average    
    Shares   Average   Remaining   Aggregate
    Under   Exercise   Contractual   Intrinsic
    Option   Price   Life (Years)   Value
                 
Outstanding at December 31, 2019     199,027,315       0.016       3.6     $ 14,360,463  
                                 
Granted     15,420,000       0.074                  
Exercised     (14,470,172 )     0.006                  
Forfeited     (5,000,000 )     0.090               —    
Expired     (1,800,000 )     0.010               —    
                                 
Outstanding at September 30, 2020     193,177,143       0.021       3.3     $ 30,655,019  
                                 
Vested and exercisable at September 30, 2020     179,537,771       0.019       3.2     $ 28,895,537  
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions

The fair value of stock option grants with only continued service conditions for vesting is estimated on the grant date using a Black-Scholes option pricing model. The following table illustrates the assumptions used in estimating the fair value of options granted during the periods presented: 

 

    Quarter ended September 30, 2020   Nine months ended September 30, 2020
Expected Term (in Years)     2 to 5       2 to 5  
Volatility     85 %     85 %
Risk Free Rate     1.4 %     1.4 %
Dividend Yield     0 %     0 %
Suboptimal Exercise Factor (1)     1.3       1.3  
Exit Rate Pre-vesting (2)     0 %     0 %
Exit Rate Post-vesting (3)     0 %     0 %
Aggregate Grant Date Fair Value   $ 21,380     $ 504,257  

 

(1) The suboptimal exercise factor estimates the value realized by the holder upon exercise of the option and the estimated point at which an option holder would exercise an in-the-money option. The Company estimated the suboptimal factor based on the holder realizing a pre-tax profit of $500,000. Used for lattice model purposes only.

 

(2) Assumed forfeiture rate for market condition option awards prior to vesting. Used for lattice model purposes only.

 

(3) Assumed expiration or forfeiture rate for market condition option awards after vesting. Used for lattice model purposes only.