What changed in this filing

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Item 1. Financial Statements

2023-11-13 compared with 2023-08-14 · 380 added, 231 removed, 240 unchanged (72% of the section changed)

2 unchanged sentences

Balance Sheets

Receivable, net

Current Assets:

and Equipment, net

AND STOCKHOLDERS’ EQUITY

Accounts Receivable, net

Prepaid Assets

Total Current Assets

Other Assets:

Property and Equipment, net

Intangible Assets, net

Total Other Assets

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current Liabilities:

& Contingencies

Stockholders’

Stock, $ 0.001 par value;

Accounts Payable

Deferred Revenue

Accrued Expenses

Total Current Liabilities

TOTAL LIABILITIES

Commitments & Contingencies

Stockholders’ Equity

Preferred Stock, $ 0.001 par value;

10,000,000 shares authorized;

316 and 465 shares issued and outstanding, respectively

Stock, $ 0.001 par value;

Common Stock, $ 0.001 par value;

1,200,000 shares authorized;

651,536 and 524,940 shares issued and outstanding, respectively

Paid-In Capital

Additional Paid-In Capital

Accumulated Deficit

( 53,406,625 )

( 49,342,484 )

Stockholders’ Equity

LIABILITIES AND STOCKHOLDERS’ EQUITY

Total Stockholders’ Equity

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

accompanying notes to condensed financial statements.

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Statements of Operations

and R&D Costs

Public Relations and Marketing

& Professional Service Fees

& Amortization

Operating Expenses

Three Months Ended

September 30,

Nine Months Ended

September 30,

COST OF REVENUE

OPERATING EXPENSES:

FROM OPERATIONS

( 1,304,019 )

Salaries & Benefits

Stock-Based Compensation

Operations and R&D Costs

Investor, Public Relations and Marketing

Organization Costs

Legal & Professional Service Fees

Office Expenses

Depreciation & Amortization

Other Operating Expenses

Total Operating Expenses

LOSS FROM OPERATIONS

( 2,284,424 )

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( 6,804,209 )

INCOME (EXPENSE)

Rate Gain (Loss)

OTHER INCOME (EXPENSE)

BEFORE PROVISION FOR INCOME TAXES

( 1,308,094 )

Interest Income

State Incentives

Exchange Rate Gain (Loss)

Interest Expense

Total Other Income (Expense)

LOSS BEFORE PROVISION FOR INCOME TAXES

( 2,292,308 )

1 unchanged sentence

( 6,746,873 )

for income Taxes

Provision for income Taxes

$ ( 871,661 )

2 unchanged sentences

$ ( 6,746,873 )

Loss Applicable to Common Stockholders

Preferred Dividends

Net Loss Applicable to Common Stockholders

$ ( 882,348 )

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$ ( 6,789,533 )

Loss per Common Share – Basic and Diluted

Loss per Common Share – Basic

Average Number of Shares Outstanding – Basic and Diluted

Average Number of Shares Outstanding – Basic

Net Loss per Common Share – Basic and Diluted

Weighted Average Number of Shares Outstanding – Basic and Diluted

accompanying notes to condensed financial statements.

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of Stockholders’ Equity

the Three Months and Six Months Ended June 30, 2023 and June 30, 2022

the Three Months Ended June 30, 2023 and June 30, 2022

March 31, 2023

( 51,205,495 )

( 1,308,094 )

the Three Months and Nine Months Ended September 30, 2023 and September 30, 2022

the Three Months Ended September 30, 2023 and September 30, 2022

Shares Outstanding

Preferred Stock

Shares Outstanding

Paid-in Capital

Accumulated Deficit

Preferred Stock

Shares Outstanding

Preferred Stock

Shares Outstanding

Paid-in Capital

Accumulated Deficit

Balances, June 30 , 2023

( 52,524,277 )

Stock Dividends

Options Issued to Directors for Services

Options Issued to Employees

June 30, 2023

Common Shares Sold in Public Offering

Offering Costs

Round-Up Shares Issued in Connection with Reverse Split

Preferred Stock Dividends

Stock Options Issued to Directors for Services

Stock Options Issued to Employees

Balances, September 30, 2023

( 53,406,625 )

March 31, 2022

Preferred Stock

Shares Outstanding

Preferred Stock

Shares Outstanding

Paid-in Capital

Accumulated Deficit

Balances, June 30, 2022

$ ( 45,076,185 )

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( 2,292,308 )

Stock Dividends

Options Issued for Third Party Services

Options Awarded to Directors for Services

Options Awarded to Employees

June 30, 2022

Preferred Stock Dividends

Stock Options Issued for Third Party Services

Stock Options Awarded to Directors for Services

Stock Options Awarded to Employees

Balances September 30, 2022

$ ( 47,382,713 )

the Six Months Ended June 30, 2023 and June 30, 2022

December 31, 2022

the Nine Months Ended September 30, 2023 and September 30, 2022

Preferred Stock

Shares Outstanding

Preferred Stock

Shares Outstanding

Paid-in Capital

Accumulated Deficit

Balances, December 31, 2022

$ ( 49,342,484 )

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( 3,931,455 )

Stock Dividends

Shares Issued for Conversion of Preferred Stock

Warrant Issued for Conversion of Preferred Stock

Options Issued to Directors for Services

Options Issued for Third Party Services

Options Issued to Employees

June 30, 2023

Common Shares Sold in Public Offering

Offering Costs

Round-Up Shares Issued in Connection with Reverse Split

Preferred Stock Dividends

Common Shares Issued for Conversion of Preferred Stock

Common Warrant Issued for Conversion of Preferred Stock

Stock Options Issued to Directors for Services

Stock Options Issued for Third Party Services

Stock Options Issued to Employees

Balances, September 30, 2023

( 53,406,625 )

December 31, 2021

Preferred Stock

Shares Outstanding

Preferred Stock

Shares Outstanding

Paid-in Capital

Accumulated Deficit

Balances, December 31, 2021

$ ( 40,593,180 )

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( 6,746,873 )

Stock Dividends

Options Issued for Third Party Services

Options Awarded to Directors for Services

Options Awarded to Employees

June 30, 2022

Preferred Stock Dividends

Stock Options Issued to Directors for Services

Stock Options Issued for Third Party Services

Stock Options Issued to Employees

Balances, September 30, 2022

$ ( 47,382,713 )

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Statements of Cash Flows

September 30,

Nine Months Ended

September 30,

OPERATING ACTIVITIES

$ ( 3,931,455 )

$ ( 6,746,873 )

to reconcile Net Loss to Net Cash used in operating activities:

and Amortization

Based Compensation - Employees

Based Compensation - Third Party Services

Based Compensation - Directors

Based Compensation

in assets and liabilities:

CASH USED IN OPERATING ACTIVITIES

Adjustments to reconcile Net Loss to Net Cash used in operating activities:

Noncash Expenses:

Depreciation and Amortization

Stock Based Compensation - Employees

Stock Based Compensation - Third Party Services

Stock Based Compensation - Directors

Stock Based Compensation

Gain on Sale of Property and Equipment

Change in assets and liabilities:

Accounts Receivable

Prepaid Assets

Accounts Payable

Deferred Revenue

Accrued Expenses

NET CASH USED IN OPERATING ACTIVITIES

( 2,586,884 )

( 6,386,415 )

of Property and Equipment

of Intangible Assets

CASH USED IN INVESTING ACTIVITIES

CASH PROVIDED BY FINANCING ACTIVITIES

CHANGE IN CASH FOR PERIOD

INVESTING ACTIVITIES

Purchase of Property and Equipment

Proceeds from Sale of Property and Equipment

Purchase of Intangible Assets

NET CASH USED IN INVESTING ACTIVITIES

FINANCING ACTIVITIES

Gross Proceeds from Public Issuance of Comon Stock

Offering Costs

NET CASH PROVIDED BY FINANCING ACTIVITIES

NET CHANGE IN CASH FOR PERIOD

( 2,289,844 )

( 6,646,367 )

AT BEGINNING OF PERIOD

AT END OF PERIOD

investing and financing activities disclosure:

Stock Dividends

of Preferred Shares to Common Shares

noncash operating activities disclosure:

of Securities for Services

of cash paid for:

CASH AT BEGINNING OF PERIOD

CASH AT END OF PERIOD

Supplemental Disclosures:

Noncash investing and financing activities disclosure:

Preferred Stock Dividends

Conversion of Preferred Shares to Common Shares

Other noncash operating activities disclosure:

Issuance of Securities for Services

Disclosure of cash paid for:

accompanying notes to condensed financial statements.

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potential in many industries, including aerospace, defense, oil and gas, bio-medical, and power generation.

of Presentation - The accompanying financial statements have been prepared by the Company in accordance with Generally

Accepted Accounting Principles (“GAAP”) in the United States of America.

In the opinion of management, all adjustments

(which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations and cash

flows at June 30, 2023 and 2022 and for the periods then ended have been made.

Certain information and footnote disclosures normally

included in financial statements prepared in accordance with GAAP have been condensed or omitted.

The Company suggests these

condensed financial statements be read in conjunction with the December 31, 2022 audited financial statements and notes thereto

included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.

The results of operations for the period ended June 30, 2023 and 2022

are not necessarily indicative of the operating results for the full year.

Stock Split - Effective September 22, 2023, we effected a 1-for-20 reverse stock split of the outstanding shares of our common stock

and a corresponding decrease in the number of shares of our common stock that we are authorized to issue.

The effects of the reverse

stock split have been retroactively reflected in all periods presented.

of Presentation - The accompanying financial statements have been prepared by the Company in accordance with Generally Accepted Accounting

Principles (“GAAP”) in the United States of America.

In the opinion of management, all adjustments (which include only normal

recurring adjustments) necessary to present fairly the financial position, results of operations and cash flows at September 30, 2023

and 2022 and for the periods then ended have been made.

Certain information and footnote disclosures normally included in financial statements

prepared in accordance with GAAP have been condensed or omitted.

These condensed financial statements should be read in

conjunction with the December 31, 2022 audited financial statements and notes thereto included in the Company’s Annual Report on

Form 10-K for the year ended December 31, 2022.

The results of operations for the period ended September 30, 2023 are not necessarily

indicative of the operating results for the full year.

Concern – The Company has sustained losses and had negative cash flows from operating activities since its inception.

reported in the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on July 20, 2023, the Company estimates

that it has sufficient cash and working capital to fund its scaled-back operations as described below through August 2023 only.

June 30, 2023, the Company has reduced its employee headcount to five, discontinued all product development activities and ceased to

pursue new customers while continuing to consider a possible reverse merger, sale of the company or all or a portion of its assets, and

other alternatives.

Except for possible sales of shares of our common stock under the At-The-Market Issuance Sales Agreement described

in Note 5- Subsequent Events, we have no agreement or arrangement to obtain any financing.

There is no assurance that we will be able

to enter into a definitive agreement with respect to a possible transaction or sell the Company or any of its assets or, if so, when

or on what terms.

If we fail to complete the sale of the Company or its assets or shares of common stock or obtain additional financing, we will be forced to resort to

the dissolution and liquidation or bankruptcy of the Company.

For these reasons, there is substantial doubt about our ability to continue

as a going concern.

September 7, 2023, we raised $ 364,555

in net proceeds pursuant to our At-The-Market Issuance Sales Agreement, or ATM Agreement, and on October 13, 2023, we raised an

additional $ 772,468

in net proceeds.

With these additional proceeds, the Company estimates that it has sufficient cash and working capital to fund its

scaled-back operations as described below pending the completion of our acquisition of NextTrip Holdings, Inc.

and sale of assets to

Divergent Technologies, Inc., or through March 2024.

The Company reduced its employee headcount, and discontinued product

development activities for the time being to ensure lowered expenses.

The Company is continuing to operate and support its existing

customers who have maintenance agreements and leases in place, supporting new installations in the field, and actively seeking

potential sales of the PrintRite3D systems and software to customers who have lease agreements in place, systems on consignment, or

otherwise express interest in Sigma’s products available for sale.

The Company completed two such sales in the quarter ended

September 30, 2023, and believes additional sales are achievable going forward as we progress towards closing the pending

transactions.

There is no assurance, however, that we will be able to close either transaction.

If we fail to complete the

acquisition of NextTrip Holdings, Inc., we intend to proceed with the sale of assets to Divergent Technologies, Inc.

and may seek to

undertake another strategic transaction, if possible, or the dissolution and liquidation or the bankruptcy of the Company.

reasons, there is substantial doubt about our ability to continue as a going concern.

Value of Financial Instruments – The carrying amounts reported in the balance sheets for the cash and cash equivalents, receivables,

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and preferred stock were excluded due to the anti-dilutive effect they would have on the computation.

At June 30, 2023 and 2022, the

Company had the following common shares underlying these instruments:

Schedule of Anti-dilutive Securities Excluded

from Computation of Earnings Per Share

Underlying Common Shares

At September 30, 2023 and 2022,

the Company had the following common shares underlying these instruments:

Schedule of Anti-dilutive Securities Excluded from Computation of Earnings Per Share

September 30,

Stock Options

Preferred Stock

Total Underlying Common Shares

following table shows the amounts used in computing loss per share and the effect on net loss and the weighted average number of potentially

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Schedule of Computing Loss Per Share

Loss per Common Share - Basic and Diluted

Loss per Common Share - Basic

Applicable to Common Stockholders (numerator)

Three Months Ended

Nine Months Ended

Net Loss Per Common Share – Basic and Diluted

Loss Applicable to Common Stockholders (numerator)

$ ( 882,348 )

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$ ( 6,789,533 )

Weighted Average Number of Common Shares Outstanding Used in Loss Per Share

During the Period (denominator)

Weighted Average Number of Common.

Shares Outstanding Used in Loss Per Share During the Period (denominator)

Estimates – The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions

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The Company determines if a contract is a lease at inception.

A contract contains

a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

contains a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

The lease term begins on the commencement date, which is the date the Company takes possession of the asset and may include options to

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the Company’s lease classification determination.

The Company has short-term leases only, cancelable upon 45 days’ notice,

and with remaining lease terms of less than one year.

Therefore, the Company has elected the short-term lease recognition exemption for

all leases, whereby leases are not recorded on the Company’s balance sheet and lease payments are recognized as lease expense on

a straight-line basis over the lease term.

The Company has month-to-month leases only, cancellable upon 45 days’ notice.

Therefore, the Company has elected the short-term lease recognition exemption for all leases, whereby leases are not recorded on the

Company’s balance sheet and lease payments are recognized as lease expense on a straight-line basis over the lease term.

and Intangible Assets – Long-lived assets and certain identifiable definite life intangibles to be held and used by the Company

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value or estimated net realizable value.

No patents were written off in the second quarter of 2023 or in fiscal 2022.

No patents were written off in the third quarter of 2023 or in fiscal 2022.

Utility patents

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the hardware and utilize subassemblies in other products.

from these operating leases for the three and six months ended June 30, 2023 was $ 11,337 and $ 28,343 .

from these operating leases for the three and nine months ended September 30, 2023 was $ 8,503 and $ 36,846 , respectively.

Receivable and Allowance for Doubtful Accounts – Trade accounts receivable are carried at original invoice amount less an estimated

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Recoveries of trade accounts receivable previously written off are recorded as income when received.

As of June 30, 2023

and June 30, 2022, the Company has established an allowance for doubtful accounts of $ 115,600 and $ 0 , respectively.

As of September 30,

2023 and September 30, 2022, the Company had established an allowance for doubtful accounts of $ 115,600 and $ 0 , respectively.

Lease Payments Receivable

lease payments receivable for the succeeding years ending December 31 are as follows:

Schedule of Minimum

Lease Payments Receivable

ending December 31,

Schedule of Minimum Lease Payments Receivable

Year ending December 31,

2023 (remaining)

Underlying Operating Leases:

under operating leases as of June 30, 2023 was comprised of the following:

under operating leases as of September 30, 2023 was comprised of the following:

Schedule of Assets underlying Operating Leases

September 30,

PrintRite3D Hardware

Accumulated Depreciation

Net Book Value

Company is depreciating the underlying equipment over its useful life of 7 years, but certain subassemblies and components may have a

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2 – Inventory

June 30, 2023 and December 31, 2022, the Company’s inventory was comprised of the following:

September 30, 2023 and December 31, 2022, the Company’s inventory comprised the following:

Schedule of Inventory

September 30,

Raw Materials

Work in Process

Finished Goods

Total Inventory

3 – Intangible Assets

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If a patent application is denied, then the costs will be expensed at that time.

the six months ended June 30, 2023, $ 27,571

of costs related to patents issued during the quarter were reclassified from provisional patent application to patents and began to

be amortized as of the date of issue.

following is a summary of definite-life intangible assets less accumulated amortization as of June 30, 2023 and December 31, 2022, respectively:

the nine months ended September 30, 2023, $ 43,530 of costs related to patents issued during the quarter were reclassified from provisional

patent application to patents and began to be amortized as of the date of issue.

following is a summary of definite-life intangible assets less accumulated amortization as of September 30, 2023 and December 31, 2022,

respectively:

Summary of Definite-life Intangible Assets and Accumulated Amortization

Patent Applications

September 30,

Provisional Patent Applications

Intangible Assets, Gross

Accumulated Amortization

Intangible Assets

expense on intangible assets was $ 14,996 and $ 10,993 for the six months ended June 30, 2023 and 2022, respectively.

Net Intangible Assets

expense on intangible assets was $ 23,102 and $ 17,010 for the nine months ended September 30, 2023 and 2022, respectively.

estimated aggregate amortization expense for years ending December 31 is as follows:

Schedule of Aggregate Amortization Expense

Intangible asset and

2023 (Remaining)

Amortization expense

4 – Stockholders’ Equity

the second quarter of 2023, the Company did not issue any shares of common stock.

September 22, 2023, we effected a 1-for-20 reverse stock split of the outstanding shares of our common stock and a corresponding decrease

in the number of shares of our common stock that we are authorized to issue.

In connection with the reverse split, we issued 40,197 common shares to round-up fractional shares to the nearest

effects of the reverse stock split have been retroactively reflected in all periods presented.

the third quarter of 2023, the Company sold 72,721

shares of common stock through our ATM Agreement, resulting in net proceeds of $ 364,555 .

the first quarter of 2023, the Company issued 11,380 shares of common stock in exchange for the conversion of 132 shares of Series D

Convertible Preferred Stock and 2,161 shares of common stock as in-kind payment of dividends thereon.

in the first quarter of 2023, the Company issued 2,428 shares of common stock in exchange for the conversion of 17 shares of Series E

Convertible Preferred Stock and 655 shares of common stock as in-kind payment of dividends thereon.

in the first quarter of 2023, the Company issued 122 shares of common stock in exchange for the conversion of 17 shares of Series E Convertible

Preferred Stock and 33 shares of common stock as in-kind payment of dividends thereon.

Company is authorized to issue 10,000,000 shares of preferred stock, $ 0.001 par value per share, of which 316 and 465 shares were issued

and outstanding at June 30, 2023 and December 31, 2022, respectively.

January 2020, the Company entered into a Securities Purchase Agreement with certain institutional investors (the “Institutional

Private Placement”), pursuant to which the Company issued and sold 1,640 shares of the Company’s newly created Series D Convertible

Preferred Stock (the “Series D Preferred Stock”) at an initial stated value of $ 1,000 per share.

Dividends accrue at a rate

of 9 % per annum (subject to increase upon the occurrence (and during the continuance) of certain triggering events described therein)

and are payable monthly in kind by the increase of the stated value of the Series D Preferred Shares by said amount.

and outstanding at September 30, 2023 and December 31, 2022, respectively.

January 2020, the Company entered into a Securities Purchase Agreement with certain institutional investors (the

“Institutional Private Placement”), pursuant to which the Company issued and sold 1,640

shares of the Company’s newly created Series D Convertible Preferred Stock (the “Series D Preferred Stock”) at an

initial stated value of $ 1,000

Dividends accrue at a rate of 9 %

per annum (subject to increase upon the occurrence (and during the continuance) of certain triggering events described therein) and

are payable monthly in kind by the increase of the stated value of the Series D Preferred Shares by said amount.

The holders of the

Series D Preferred Shares have the right at any time to convert all or a portion of the Series D Preferred Shares (including, without

limitation, accrued and unpaid dividends and make-whole dividends through the third anniversary of the closing date) into shares of the

Company’s Common Stock at the conversion price then in effect, which is $ 0.58 (subject to adjustment for stock splits, dividends,

recapitalizations and similar events and full ratchet price protection in the event the Company issues or sells, or is deemed to have

issued or sold, shares of Common Stock for a consideration per share less than a price equal to the conversion price then in effect).

January 27, 2023, the holder of the remaining 132 outstanding shares of Series D Preferred Stock elected to convert such shares, which resulted in the issuance of 270,828 shares of common stock.

June 30, 2023, there were no shares of Series D Preferred Stock outstanding.

Series D Preferred Shares have the right at any time to convert all or a portion of the Series D Preferred Shares (including,

without limitation, accrued and unpaid dividends and make-whole dividends through the third anniversary of the closing date) into

shares of the Company’s Common Stock at the conversion price then in effect, which was $ 6.00

as of September 30, 2023 (subject to adjustment for stock splits, dividends, recapitalizations and similar events and full ratchet

price protection in the event the Company issues or sells, or is deemed to have issued or sold, shares of Common Stock for a

consideration per share less than a price equal to the conversion price then in effect).

January 27, 2023, the holder of the remaining 132 outstanding shares of Series D Preferred Stock elected to convert such shares, which

resulted in the issuance of 13,541 shares of common stock.

September 30, 2023, there were no shares of Series D Preferred Stock outstanding.

with the Institutional Private Placement, the Company entered into a Securities Purchase Agreement pursuant to which the Company issued

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for stock splits, dividends, recapitalizations and similar events).

January 23, 2023, the holder of 17

shares of Series E Preferred Stock elected to convert such shares, which resulted in the issuance of 3,083

shares of common stock.

June 30, 2023, 316

shares of Series E Preferred Stock were outstanding, which were convertible into 60,332

shares of common stock, including in-kind dividends thereon.

January 23, 2023, the holder of 17 shares of Series E Preferred Stock elected to convert such shares, which resulted in the issuance

of 155 shares of common stock.

September 30, 2023, 316 shares of Series E Preferred Stock were outstanding, which were convertible into 3,069 shares of common stock,

including in-kind dividends thereon.

Company’s 2013 Equity Incentive Plan expired on March 15, 2023.

As such, there were no shares of common stock reserved for future

issuance thereunder as of June 30, 2023.

issuance thereunder as of September 30, 2023.

January 26, 2023, the Company granted options to its non-employee directors to purchase up to an aggregate of 2,620 shares of common

stock at an exercise price of $ 11.60 .

As of June 30, 2023, 50 % of such grants were fully vested and exercisable, and the remaining 50 %

will vest in equal quarterly installments over the remaining two quarters of 2023, subject to the directors remaining in our service

through such dates.

As of September 30, 2023, 75 % of such grants were fully vested and exercisable, and the remaining

25 % will vest on December 31, 2023, subject to the directors remaining in our service through such date.

January 26, 2023, the Company granted 19 employees options to purchase up to an aggregate of 19,065 shares of common stock in connection

with their employment.

The options have an exercise price of $ 0.58 and vested as to 50 % on the date of the grant, and will vest as to

The options have an exercise price of $ 11.60 , vested as to 50 % on the date of the grant, and will vest as to

the remaining 50 % in equal monthly installments over the subsequent 23 months, provided that the employees remain employed by the Company

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The Company recognizes compensation expense for the fair value of the stock options over the vesting period for each stock option award.

stock-based compensation expense included in the statements of operations for the six months ended June 30, 2023 and 2022 was $ 363,339

stock-based compensation expense included in the statements of operations for the nine months ended September 30, 2023 and 2022 was $ 447,417

and $ 613,833 respectively, all of which is related to stock options.

fair value of stock-based awards was estimated using the Black-Scholes model with the following weighted average assumptions for the

six months ended June 30, 2023, and 2022:

Schedule of Share Based Payments Award Stock

Options Valuation Assumptions

interest rate

nine months ended September 30, 2023, and 2022:

Schedule of Share Based Payments Award Stock Options Valuation Assumptions

Dividend yield

Risk-free interest rate

0.95 - 3.23 %

Expected volatility

100.23 - 100.25 %

life (in years)

activity for the six months ended June 30, 2023 and the year ended December 31, 2022 was as follows:

of Share Based Compensation Stock Option Activity

outstanding at December 31, 2021

outstanding at December 31, 2022

outstanding at June 30, 2023

expected to vest in the future as of June 30, 2023

exercisable at June 30, 2023

vested, exercisable, and options expected to vest at June 30, 2023

106.40 - 109.97 %

Expected life (in years)

activity for the nine months ended September 30, 2023 and the year ended December 31, 2022 was as follows:

Schedule of Share Based Compensation Stock Option Activity

Options outstanding at December 31, 2021

Forfeited or cancelled

Options outstanding at December 31, 2022

Forfeited or cancelled

Options outstanding at September 30, 2023

Options unvested at September 30, 2023

Options vested at September 30, 2023

Options outstanding at September 30, 2023

aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the market price of

our common stock for those awards that have an exercise price below the market price of our common stock.

At June 30, 2023, no option

At September 30, 2023, no option

had an exercise price below the $ 3.06 closing price of our common stock as reported on The Nasdaq Capital Market.

June 30, 2023, there was $ 387,351 of unrecognized stock-based compensation expense related to unvested stock options with a weighted

September 30, 2023, there was $ 278,132 of unrecognized stock-based compensation expense related to unvested stock options with a weighted

average remaining recognition period of 1.26 years.

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of common stock are reserved or will be issued pursuant to the Plan.

A SAR is the right to receive an amount equal to the Spread with respect to a share of the Company’s

common stock (“Share”) upon the exercise of the SAR.

The “Spread” is the difference between the exercise price

per share specified in a SAR agreement on the date of grant and the fair market value per share on the date of exercise of the SAR.

exercise price per share will not be less than 100% of the fair market value of a share of common stock on the date of grant of the SAR.

The administrator of the Plan will have the authority to, among other things, prescribe the terms and conditions of each SAR, including the exercise price and vesting provisions, and to specify the provisions of the SAR Agreement relating to such grant.

Company did not grant any SAR’s during the six months ended June 30, 2023.

SAR is the right to receive an amount equal to the Spread with respect to a share of the Company’s common stock (“Share”)

upon the exercise of the SAR.

The “Spread” is the difference between the exercise price per share specified in a SAR agreement

on the date of grant and the fair market value per share on the date of exercise of the SAR.

The exercise price per share will not be

less than 100% of the fair market value of a share of common stock on the date of grant of the SAR.

The administrator of the Plan will

have the authority to, among other things, prescribe the terms and conditions of each SAR, including the exercise price and vesting provisions,

and to specify the provisions of the SAR Agreement relating to such grant.

Company did not grant any SAR’s during the nine months ended September 30, 2023.

Company recognizes compensation expense and a corresponding liability for the fair value of the SARs over the vesting period for each

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any changes in fair value are reflected in the Statement of Operations as of the applicable reporting date.

fair value of SAR awards was estimated using the Black-Scholes model with the following weighted average assumptions for the six months

ended June 30, 2023 and the year ended December 31, 2022:

of Share Based Payments Award Stock Options Valuation Assumptions

interest rate

fair value of SAR awards was estimated using the Black-Scholes model with the following weighted average assumptions for the nine months

ended September 30, 2023 and the year ended December 31, 2022:

Schedule of Share Based Payments Award Stock Options Valuation Assumptions

Dividend yield

Risk-free interest rate

0.82 - 2.79 %

Expected volatility

108.0 - 119.0 %

life (in years)

activity for the six months ended June 30, 2023 and the year ended December 31, 2022 was as follows:

of Stock Option Activity

outstanding at December 31, 2021

outstanding at December 31, 2022

outstanding June 30, 2023

expected to vest in the future as of June 30, 2023

exercisable at June 30, 2023

vested, and exercisable, and SARs expected to vest at June 30, 2023

Expected life (in years)

activity for the nine months ended September 30, 2023 and the year ended December 31, 2022 was as follows:

Schedule of Stock Option Activity

SARs outstanding at December 31, 2021

Forfeited or cancelled

SARs outstanding at December 31, 2022

Forfeited or cancelled

SARs outstanding September 30, 2023

SARs unvested at September 30, 2023

SARs vested at September 30, 2023

SARs outstanding at September 30, 2023

aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the market price of

our common stock for those awards that have an exercise price below the market price of our common stock.

At June 30, 2023, no SAR had

an exercise price below the $ 0.35 closing price of our common stock as reported on The Nasdaq Capital Market.

June 30, 2023, there was $ 474,228 of unrecognized stock-based compensation expense related to unvested SARs with a weighted average remaining

recognition period of 1.75 years.

activity for the six months ended June 30, 2023 and the year ended December 31, 2022 was as follows:

of Warranty Activity

outstanding at December 31, 2021

outstanding at December 31, 2022

( 2,412,086 )

outstanding at June 30, 2023

At September 30, 2023, no SAR

had an exercise price below the $ 3.06 closing price of our common stock as reported on The Nasdaq Capital Market.

September 30, 2023, there was $ 396,579 of unrecognized stock-based compensation expense related to unvested SARs with a weighted average

remaining recognition period of 1.51 years.

activity for the nine months ended September 30, 2023 and the year ended December 31, 2022 was as follows:

Schedule of Warranty Activity

Warrants outstanding at December 31, 2021

Forfeited or cancelled

Warrants outstanding at December 31, 2022

Forfeited or cancelled

Warrants outstanding at September 30, 2023

5 - Subsequent Events

July 2023, the Company realized gross proceeds of approximately $ 135,000 from the sale of equipment.

On July 14, 2023, the employment of Stephan Kuehr,

General Manager of European Operations, terminated.

August 14, 2023, the Company entered into an At-the-Market Issuance Sales Agreement (the “Sales Agreement”) with Lake Street

Capital Markets, LLC, or Lake Street, pursuant to which the Company may issue and sell from time to time through Lake Street, as sales

agent, shares of our common stock having an aggregate offering price of up to $ 1,500,000 (the “Offering”).

The Offering is being made pursuant to a

prospectus supplement filed with the Securities and Exchange Commission in connection with the Offering under its Registration Statement

on Form S-3 (File No.

333-257054), which became effective on June 29, 2021, and the base prospectus contained therein.

delivery of a placement notice, and subject to the terms and conditions of the Sales Agreement, Lake Street as sales agent may sell shares

of common stock by methods deemed to be an “at the market offering” as defined in Rule 415(a)(4) under the Securities Act

of 1933, as amended.

The sales agent is not required to purchase any shares of common stock from the Company or sell any specific number

or dollar amount of common stock but will use its commercially reasonable efforts consistent with its normal trading and sales practices

as our agent to sell shares of common stock in the Offering as instructed by us.

Company or Lake Street may suspend or terminate the Offering upon notice to the other and subject to other conditions.

Company has agreed to pay Lake Street a commission of 3.0 % of gross proceeds from the Offering and to reimburse Lake Street for certain

The Company has also agreed to afford Lake Street customary indemnification and contribution rights.

October 13, 2023, the Company raised $ 772,468 in net proceeds by selling 128,887 common shares pursuant to its ATM Agreement.

October 6, 2023, the Company entered into a definitive asset purchase agreement (“APA”) with Divergent Technologies, Inc.,

or Divergent, pursuant to which have agreed to sell to Divergent, and Divergent has agreed to purchase from us, certain assets consisting

primarily of patents, software code and other intellectual property for a purchase price of $ 1,626,242 , including a $ 37,000 earnest-money

deposit previously paid to us by Divergent.

parties’ respective obligations to close are subject to the accuracy of the parties’ respective representations and warranties

and performance of their respective covenants and satisfaction or waiver of other customary conditions specified in the Asset Purchase

Asset Purchase Agreement contains customary representations and warranties which will survive for one year following the closing.

Asset Purchase Agreement also contains restrictive covenants regarding the conduct of our business pending the closing.

the interim, between the signing date and closing date or termination of the Asset Purchase Agreement, we have granted Divergent a

non-exclusive, non-transferable, non-sublicensable (except to Divergent customers and affiliates), limited, irrevocable (except in

connection with the termination of the Asset Purchase Agreement in certain circumstances), worldwide, royalty-free license to the

“Licensed IP” (as defined) for testing, evaluation, and commercialization purposes.

October 12, 2023, the Company entered into a definitive Share Exchange Agreement for the acquisition of NextTrip Holdings, Inc., a

travel technology company based in Sunrise, Florida (“NextTrip”).

Pursuant to the terms and conditions of the Agreement,

Sigma will acquire 100 %

of the capital stock of NextTrip in exchange for shares of Sigma common stock constituting 19.99 %

of its outstanding common stock plus additional contingent shares of Sigma common stock upon the achievement of post-closing

milestones tied to the business performance of NextTrip.

Assuming all business milestones are achieved, the equity owners of

NextTrip will receive a total of 6

million shares of our common stock, resulting in existing Sigma holders retaining, on a pro forma basis, approximately 9.8 %

of the total outstanding shares immediately following the issuance of such shares.

parties’ respective obligations to close the Acquisition are subject to the satisfaction or waiver of various conditions

specified in the Share Exchange Agreement.

The conditions include approval by Sigma shareholders of the issuance of the Exchange

Shares as required by applicable listing standards of The Nasdaq Capital Market, or Nasdaq, amendments to our amended and restated

articles of incorporation to change our name and to increase our authorized common stock, and the continued listing or our common

stock on Nasdaq, as well as customary other closing conditions.

The Share Exchange Agreement contains representations and warranties and

covenants of the parties customary for a transaction of this nature which will not survive the closing of the Acquisition.

The Share Exchange

Agreement also contains customary covenants regarding the conduct of the respective businesses of Sigma and NextTrip pending the closing

of the Acquisition.

The Share Exchange Agreement permits us to sell our quality assurance software assets at or after the closing of the

Acquisition as contemplated by our Asset Purchase Agreement with Divergent Technologies, Inc.

transactions are expected to be completed in the fourth quarter of 2023, subject to shareholder approvals and other customary closing

October 6, 2023, Nasdaq Listing Qualifications (“Nasdaq”) notified the Company that it had regained compliance with the minimum

bid price Listing Rule 5550(a)(2) as the Company’s closing bid price of its common stock had been at or greater than $1.00 per

share for ten consecutive business days following the effective date of the Company’s reverse stock split.

Nasdaq further notified

the Company that the matter is closed.

August 17, 2023, the Company received notice from Nasdaq that because our stockholders’ equity as of June 30, 2023 was $ 2,391,289 ,

we no longer comply with Nasdaq Listing Rule 5550(b)(1), which requires companies listed on the Nasdaq Capital Market to maintain minimum

stockholders’ equity of $ 2,500,000 , and do not meet the alternatives of market value of listed securities or net income from continuing

The notice stated that under Nasdaq Rules, we have 45 calendar days to submit a plan to regain compliance and that if our

plan is accepted, Nasdaq can grant us an extension of up to 180 calendar days from the date of the notice to evidence compliance.

October 2, 2023, the Company submitted its plan to regain compliance to Nasdaq and requested an extension to February 13, 2024 to evidence

compliance with the Rule and all other applicable criteria for continued listing on Nasdaq.

October 23, 2023, Nasdaq informed the Company that based on the submission, it had granted the requested extension until February 13,

2024 to demonstrate compliance with the Rule.

Nasdaq further informed the Company that if the Company fails to evidence compliance upon

filing its periodic report for the quarter ended March 31, 2024 with the SEC and Nasdaq, the Company may be subject to delisting.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements