|9 Months Ended|
Sep. 30, 2019
NOTE 4 - STOCKHOLDERS’ EQUITY
At The Market Offering Agreement
On July 19, 2019, we entered into an At The Market Offering Agreement (the “Agreement”) with H.C. Wainwright & Co., LLC (“H.C. Wainwright”) which establishes an at-the-market equity program pursuant to which we may offer and sell shares of our common stock, par value $0.0001 per share (“Common Stock”), from time to time as set forth in the Agreement. The Agreement provides for the sale of shares of our Common Stock (“Shares”) having an aggregate offering price of up to $7,472,417 (the Company’s ability to offer shares under the Agreement is limited to the amount of shares it may sell pursuant to General Instruction I.B.6. of Form S-3.
Subject to the terms and conditions set forth in the Agreement, H.C. Wainwright will use its commercially reasonable efforts consistent with its normal trading and sales practices to sell the Shares from time to time, based upon our instructions. We have provided H.C. Wainwright with customary indemnification rights, and H.C. Wainwright will be entitled to a commission at a fixed rate equal to three percent (3.0%) of the gross proceeds per Share sold. In addition, we have agreed to pay certain expenses incurred by H.C. Wainwright in connection with the Agreement, including up to $25,000 of the fees and disbursements of their counsel. The Agreement will terminate upon the earlier of sale of all of the Shares under the Agreement or July 19, 2022 unless terminated earlier by either party as permitted under the Agreement.
Sales of the Shares, if any, under the Agreement shall be made in transactions that are deemed to be “at the market offerings” as defined in Rule 415 under the Securities Act of 1933, as amended (the “Securities Act”), including sales made by means of ordinary brokers’ transactions, including on the Nasdaq Capital Market, at market prices or as otherwise agreed with H.C. Wainwright. We have no obligation to sell any of the Shares, and, at any time, we may suspend offers under the Agreement or terminate the Agreement.
During the nine months ended September 30, 2019, 41,614 shares of common stock were issued under the At The Market Offering for the total proceeds of $79,817, net of offering cost of $3,636.
Asset Purchase Agreement
On September 30, 2019, the Company consummated the purchase of 6,000 S-9 Bitmain 13.5 TH/s Bitcoin Antminers from SelectGreen Blockchain Ltd, a British Columbia corporation, for which the purchase price was $4,086,250 or 2,335,000 shares of its common stock at a price of $1.75 per share. As a result of an exchange cap requirement imposed in conjunction with the Company’s Listing of Additional Shares application filed with Nasdaq with regard to the transaction, the Company issued 1,279,442 shares of its common stock which represented $2,233,773 of the $4,086,250 (constituting 19.9% of the issued and outstanding shares outstanding on the date of the Asset Purchase Agreement for the transaction) and upon receipt of shareholder approval, at the Special Shareholders Meeting on November 15, 2019, the Company will issue the balance of the 1,058,558 unregistered common stock shares. The $1,852,477 set forth on the balance sheet for mining servers payable reflects this balance of 1,058,558 shares to be issued at $1.75 per share immediately upon receipt of shareholder approval, thus immediately satisfying the mining servers payable. If the Company does not gain shareholder approval (which it anticipates it will receive), it would plan to resolicit shareholders after a reasonable waiting period; however, this is neither the intention nor the requirement to make payment in cash.
Series B Convertible Preferred Stock
As of September 30, 2019, there was no share of Series B Convertible Preferred Stock outstanding.
Series E Preferred Stock
There was no Series E Convertible Preferred Stock outstanding as of September 30, 2019.
Common Stock Warrants
As of September 30, 2019, the Company had warrants outstanding to purchase 182,191 shares of Common Stock with a weighted average remaining life of 2.3 years and a weighted average exercise price of $25.04. There was no activity of the Company’s warrants during the period ended September 30, 2019.
Common Stock Options
On July 22, 2019, the Company’s board has approved to issue 275,000 shares of option to purchase the Company’s common stock to 8 employees and consultants for the service they provided. The options have a five-year term with an exercise price of $2.04.
A summary of the stock options as of September 30, 2019 and changes during the period are presented below:
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://fasb.org/us-gaap/role/ref/legacyRef