Company: KWIK
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001683168-25-002055
Chunk: 155

Company: KwikClick, Inc.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 1A
Chunk 155
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 the treasury stock method using the if-converted method. Due to the incurrence of net losses, the Company did not include outstanding
instruments convertible into common stock that would be anti-dilutive. As of December 31, 2024 and 2023 the Company had 1,602,470 and
102,470 warrants respectively; and 9,253,934 and 1,758,000 stock appreciation rights exercisable into shares of common stock, respectively,
that were potentially dilutive.

     F-6 

KWIKCLICK, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years Ended December 31, 2024 and 2023

Property and Equipment

Property and equipment are recorded at cost. Expenditures
for major betterments and additions are charges to the asset accounts, while replacements, maintenance and repairs which do not improve
or extend the lives of the respective assets are charged to expense as incurred. Depreciation of property and equipment is computed by
the straight-line method using various rates based generally on the useful lives of the assets, which range from five to seven years.

Intellectual Property

Intellectual property includes certain external legal
costs for the application, maintenance and extension of the useful life of patents. Intellectual property costs are capitalized, based
on management’s estimates, when they are deemed to be recoverable. Other intellectual property-related costs are expensed as incurred.
Capitalized intellectual property costs are amortized utilizing the straight-line method over their remaining economic useful lives of
up to 20 years. Amortization of such costs begins when the patent is issued.

Impairment of Long-Lived Tangible Assets and Intellectual
Property

The Company reviews long-lived tangible and intellectual
property assets for potential impairment annually and when events or changes in circumstances indicate the carrying amount of an asset
may not be recoverable. In the event the expected undiscounted future cash flows resulting from the use of the asset is less than the
carrying amount of the asset, an impairment loss is recorded equal to the excess of the asset’s carrying value over its fair value.
The Company did not recognize any impairment charges for the years ended December 31, 2024 and 2023.

Research and Development

Research and development costs primarily consist of
internal and external engineering staff wages, coding, and related on-going activities associated with upgrading and enhancing the Company’s
internally developed software platform. Research and development costs that do not meet the criteria for