10,000, respectively. As of September 30, 2021 and March 31, 2021 there was $0 and $10,000, respectively receivable from these two customers.

ROCKETFUEL BLOCKCHAIN, INC.

NOTES TO FINANCIAL STATEMENTS

SEPTEMBERJUNE 30, 20212022

(UNAUDITED)

8. Convertible Note PayableStock-based Compensation

On August 4, 2021, we entered into a securities purchase agreement with a lender pursuantThe Company applies the provisions of ASC 718, Compensation - Stock Compensation, (“ASC 718”) which requires the measurement and recognition of compensation expense for all stock-based awards made to which we sold a convertible note payableemployees, including employee stock options, in the principal amountstatements of $130,000 for cash proceeds of $126,250. The convertible note is due one year from issuance, pays interest at the rate of 8% per annum, unless in default, upon which the interest rate would increase to 22% and the principal balance would increase by 150% or 200% depending upon the nature of the default. The convertible note gives us the right to prepay the note within the first 180 days from issuance at prepayment rates ranging from 110% to 125% of the then outstanding principal and interest balance. At any time during the period beginning 180 days from the origination date to the maturity date or date of default, the holder can convert all or any part of the outstanding balance into common stock at a conversion price per share equal to 65% of the lowest daily volume weighted average price of our common stock during the 10 trading days prior to the date of conversion.operations.

We evaluated the embedded conversion feature and concluded that it required to be bifurcated and accounted for as a derivative liability due to the lack of explicit limit on the number of shares that may be required to beFor stock options issued to settleemployees and members of the instrument. Accordingly,Board of Directors (the “Board) for their services, the Company estimates the grant date fair value of each option using the embedded conversion feature at inception was reflected as a derivative liability inBlack-Scholes option pricing model. The use of the balance sheet,Black-Scholes option pricing model requires management to make assumptions with respect to the expected term of the option, the expected volatility of the common stock consistent with the expected life of the option, risk-free interest rates and expected dividend yields of the common stock. For awards subject to service-based vesting conditions, including those with a resulting discount appliedgraded vesting schedule, the Company recognizes stock-based compensation expense equal to the note payable. At inception, thegrant date fair value of stock options on a straight-line basis over the conversion feature was deemedrequisite service period, which is generally the vesting term. Forfeitures are recorded as they are incurred as opposed to be $120,151 as determined using a Stock Path Monte Carlo Simulation model. The key assumptions used in this valuation included: (1) dividend yieldbeing estimated at the time of 0%, (2) expected volatility of 197.41%, (3) risk-free interest rate of 0.07%, (4) expected life of 1 year,grant and (5) the quoted market price of $1.01 for our common stock.revised.

At September 30, 2021,Pursuant to Accounting Standards Update (“ASU”) 2018-07, Compensation – Stock Compensation (Topic 718): Improvements to Non-employee Share-Based Payment Accounting, the embedded conversion feature had a fairCompany accounts for stock options issued to non-employees for their services in accordance with ASC 718. The Company uses valuation methods and assumptions to value of $113,410, resultingthe stock options that are in line with the recognition of other income of $6,741 in the income statement. The key assumptions used in this valuation included: (1) dividend yield of 0%, (2) expected volatility of 168.92%, (3) risk-free interest rate of 0.09%, (4) expected life of 0.84 year, and (5) the quoted market price of $1.10process for our common stock.valuing employee stock options noted above.

A rollforward of the embedded conversion feature derivative liability for the six months ended September 30, 2021 is as follows:Income Taxes

Schedule of Roll-forward Conversion Feature Derivative liability

At inception, the convertible note had a debt discount of $123,901 which will be amortized to interest expense over the life of the note. The remaining debt discount at September 30, 2021 related to the convertible note was $104,552.

9. Income Taxes

We are required to file federal and state income tax returns in the United States. The preparation of these tax returns requires us to interpret the applicable tax laws and regulations in effect in such jurisdictions, which could affect the amount of tax paid by us. In consultation with our tax advisors, we base our tax returns on interpretations that are believed to be reasonable under the circumstances. The tax returns, however, are subject to routine reviews by the various federal and state taxing authorities in the jurisdictions in which we file tax returns. As part of these reviews, a taxing authority may disagree with respect to the income tax positions taken by us (“uncertain tax positions”) and, therefore, may require us to pay additional taxes. As required under applicable accounting rules, we accrue an amount for our estimate of additional income tax liability, including interest and penalties, which we could incur as a result of the ultimate or effective resolution of the uncertain tax positions. We account for income taxes using the asset and liability method. Under the asset and liability method, deferred tax assets and liabilities are recognized for the future tax consequences attributed to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences and carry-forwards are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is established when necessary to reduce deferred tax assets to amounts expected to be realized.

ROCKETFUEL BLOCKCHAIN, INC.

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2021

(UNAUDITED)

In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment.

We had no income tax credits forImpact of COVID-19 on Our Business

The COVID-19 pandemic has resulted, and may continue to result, in significant economic disruption despite progress made in the threedevelopment and six months ended September 30, 2021distribution of vaccines. It has already disrupted global travel, supply chains and 2020.the labor market and adversely impacted global commercial activity. Considerable uncertainty still surrounds COVID-19, the evolution of its variants, its potential long-term economic effects, as well as the effectiveness of any responses taken by government authorities and businesses and of various efforts to inoculate the global population. The effective tax ratestravel restrictions, limits on hours of operations and/or closures of non-essential businesses, and other efforts to curb the spread of COVID-19 have significantly disrupted business activity globally and there is uncertainty as to when these disruptions will fully subside.

Significant uncertainty continues to exist concerning the impact of the COVID-19 pandemic on our customers’ and prospects’ business and operations in future periods. Although our total revenues for the three months ended June 30, 2022 were not materially impacted by COVID- 19, we believe our revenues may be negatively impacted in future periods until the effects of the pandemic have fully subsided and six ended September 30, 2021 was 21.0%.the current macroeconomic environment has substantially recovered. The uncertainty related to COVID-19 may also result in increased volatility in the financial projections we use as the basis for estimates and assumptions used in our financial statements. We have estimatedadapted our provisionoperations to meet the challenges of this uncertain and rapidly evolving situation, including establishing remote working arrangements for income taxesour employees, limiting non-essential business travel, and cancelling or shifting our customer, employee, and industry events to a virtual-only format for the foreseeable future. We have not received any government assistance from various relief packages available in accordance with the Tax Act and guidance available ascountries where we operate.

Effects of the COVID-19 pandemic that may negatively impact our business in future periods include, but are not limited to: limitations on the ability of our customers to conduct their business, purchase our products and services, and make timely payments; curtailed consumer spending; deferred purchasing decisions; delayed consulting services implementations; labor shortages and decreases in product licenses revenues driven by channel partners. We will continue to actively monitor the nature and extent of the impact to our business, operating results, and financial condition.

Recent Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board or other standard setting bodies that may have an impact on our accounting and reporting. We believe that such recently issued accounting pronouncements and other authoritative guidance for which the effective date is in the future either will not have an impact on our accounting or reporting or that such impact will not be material to our financial position, results of this filing but have kept the full valuation allowance.operations and cash flows when implemented.

10.3. Stockholders’ Equity (Deficit)Going Concern

OnOur consolidated financial statements have been presented on the basis that we are a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. We incorporated our business on January 9, 2020, we sold 10,000 shares12, 2018, the date of our common stock toinception, and commenced commercial operations in March 2021. During the three months ended June 30, 2022 and 2021, we reported a private investor, resulting in cash proceedsnet loss of $10,000. On February 13, 2020, we sold 11,250948,728 sharesand $1,204,591, respectively, which included as a component of our common stock togeneral and administrative expenses in the statements of operations a private investor, resulting in cash proceedsnon-cash stock-based compensation charge of $11,250291,382. and $316,896, respectively, and cash flows used in operating activities during the three months ended June 30, 2022 and 2021 of $974,067 and $876,340, respectively. These factors, among others, raise substantial doubt about the ability of the Company to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

On April 29, 2020,We will require additional financing to continue to develop our product and execute on our business plan. However, there can be no assurances that we entered intowill be successful in raising the additional capital necessary to continue operations and execute on our business plan. During the year ended March 31, 2022, we raised $882,500 through the exercise by certain investors of common stock purchase warrants and completed a subscription agreement with a private investor for the purchasepublic offering of 478,7506,666,667 shares of our common stock, at aCommon Stock and accompanying warrants to purchase price of $1.00 per share, resulting in cash proceeds of $478,750. This transaction was a part of a private placement of 500,0006,666,667 shares of Common Stock and raised approximately $4.4 million in proceeds, net of the issuance costs. We have used and plan to continue using the net proceeds of the public offering and warrant exercise to recruit key management and operational personnel, to retain software and blockchain developers and to develop our blockchain based check-out solution. Management believes the funding from the public offering, the exercise of the common stock. We paidstock purchase warrant, and the growth strategy actions executed and planned for execution could contribute to our ability to mitigate any substantial doubt as to our ability to continue as a placement fee of $50,000 in connection with these transactions.going concern.

On August 24, 2020, we issued4. 150,000Property, Plant & Equipment shares of our Common Stock to a consultant in lieu of cash for services. The common stock was valued at $162,000, or $1.08 per share, based on an independent appraisal.

On May 1, 2020, the Company issued a warrant to purchase 1,500,000 shares of common stock at $1.00 per share (the “First Warrant”). The warrant expired on April 30, 2021. The Company also agreed that upon the fullCompany’s property, plant and timely exerciseequipment assets are comprised of the First Warrant, it would issue a second warrant for an additional 1,500,000 shares of common stock at a purchase price of $1.50 per share having a term of 12 months from the date of issue (the “Second Warrant”). The First Warrant was transferred to an affiliate of the original holder in November 2021. During the three-month period ended March 31, 2021, the warrant holder exercised warrants from the First Warrant to purchase 1,100,000 shares of our common stock of which (i) 1,000,000 shares of our common stock were issued in consideration of gross proceeds of $1,000,000 prior to March 31, 2021; and (ii) 100,000 shares of our common stock, for which we received notice of exercise on March 31, 2021, were issued in April 2021 in consideration of gross proceeds of $100,000. Additionally, the warrant holder exercised the First Warrant for the remaining 400,000 shares of our common stock in April 2021 in consideration of gross proceeds of $400,000. On April 26, 2021 we issued the Second Warrant to the holder. On August 6, 2021, we agreed to amend the terms of the Second Warrant to increase the number of shares purchasable to 2,250,000 and to reduce the exercise price to $1.00 per share. On August 19, 2021, the warrant holder exercised warrants from the Second Warrant to purchase 100,000 shares of our common stock at an exercise price of $1.00 per share.following:

On February 25, 2021, we entered into a common stock purchase agreement (the “Stock Purchase Agreement”) with Triton Funds, LP, a Delaware limited partnership (“Triton” or the “Selling Stockholder,” which term also includes Triton’s successors and assigns under the Stock Purchase Agreement and the Warrant). Under the Stock Purchase Agreement Triton, which is an unrelated third party, agreed to invest up to $1,000,000 Schedule of Property Plant And Equipmentthrough purchases of our Common Stock during the commitment period (which runs through December 31, 2022). During the commitment period, we may, in our sole discretion, deliver purchase notices to Triton stating the dollar amount of shares which we intend to sell to Triton, not to exceed $500,000 per purchase notice. The amount to be funded under a purchase notice will be the number of shares of Common Stock to be purchased multiplied by the greater of (i) $1.65 or (ii) 80 percent of the lowest closing price of our Common Stock within 15 business days prior to the closing date for the purchase. The closing date for each purchase is five business days following the date of the corresponding purchase notice. As of September 30, 2021, we have not issued any purchase notices pursuant to the Stock Purchase Agreement. In connection with these transactions, we paid Triton an administrative fee of $15,000.

ROCKETFUEL BLOCKCHAIN, INC.

NOTES TO FINANCIAL STATEMENTS

SEPTEMBERJUNE 30, 20212022

(UNAUDITED)

Triton’s obligationCapitalized software development costs represent the costs incurred during the development stage, when direct and incremental internal and external costs, are capitalized until the software is substantially complete and ready for its intended use. The Company also capitalizes costs related to purchase Common Stockspecific upgrades and enhancements of internal-use software when it is conditioned on certain factors including, but not limited to, our having an effective S-1 registration statementprobable that the expenditures will result in effect for resale of the Common Stock being purchased and Triton’s ownership not exceeding 4.99% of our issued and outstanding shares at any time.additional functionality.

In connectionDepreciation and amortization expenses amount to $87,081 and $nil for the three months ended June 30, 2022 and 2021, respectively.

5. Related Party Transactions

During the three months ended June 30, 2022 and 2021, our chief financial officer was affiliated with the Stock Purchase Agreement, we also issued to Triton warrants to purchase, in one or more instalments, 800,000 shares of our Common Stocklegal counsel who provided us with general legal services (the “Warrants”“Affiliate”) at an exercise price equal. We recorded legal fees paid to the greaterAffiliate of (i) $1.6558,058 per share or (ii) and $8024,160 percentfor the three months ended June 30, 2022 and 2021, respectively. As of June 30, 2022 and March 31, 2022, we had $47,679 and $11,277, respectively, payable to the average closing priceAffiliate.

6. Deferred Revenue

We enter into certain contracts typically having initial one-year terms which define the scope of our Common Stockservices to be provided. These contracts can include agreed-upon setup fees during the initial one-year term, which setup fees are recorded as deferred revenue and amortized ratably over the 90-calendar day period precedinginitial one-year term. During the Warrant exercise date, subject to adjustments. The Warrants terminate on February 25, 2026. If, at any time after the initial effective date of the S-1 registration statement filed in connection with the Stock Purchase Agreementthree months ended June 30, 2022 and during the exercise period of the Warrants, there is no effective registration statement covering the Selling Stockholder’s immediate resale of the shares underlying the exercise of the Warrants (the “Warrant Shares”), then Selling Stockholder may elect to receive Warrant Shares pursuant to a cashless exercise of the Warrants. On May 5, 2021, Triton exercised 50,000 Warrants for an aggregate purchase pricewe recorded revenues of $82,5008,132. and $2,500, respectively. Deferred revenue was $11,292 and $15,073 as of June 30, 2022 and March 31, 2022, respectively.

7. Stockholders’ Equity

Cancellations of Stock:

On March 31,October 6, 2021, we entered into a contract with one customer having a one-year term from the date of execution that provided for (1) the payment of $10,000 in connection with the implementation of our blockchain technology and (2) the issuance of 10,000shares of our common stock valued at $1.00per share in consideration of being an early adopter of our blockchain technology. On August 4, 2021,In March 2022, in settlement of a customer dispute, we issued suchrepurchased the 10,000shares of our common stock toissued in October 2021 for $3,000. During the customer.three months ended June 30, 2022, the 10,000 shares were cancelled.

From January 1, 2018 through SeptemberOn June 7, 2022, we entered into a settlement agreement in the legal proceedings with Joseph Page,our former director and chief technology officer, as defendant, whereunder Page surrendered 3,600,394 shares of the Company’s common stock. In connection with this settlement, we recognized a gain of $540,059, calculated based on the Company’s share price of $0.15 per share on the date of settlement of the legal proceedings. This gain was recorded in other income for the three months ended June 30, 2021,2022 in the accompanying consolidated statements of operations. Immediately after these shares were transferred to the Company, the 3,600,394 shares were cancelled and we granted stock options under our 2018 Stock Incentive Plan, as amended, to issue up to an aggregaterecorded cancellation of these treasury shares for the three months ended June 30, 2022.

5,600,595

As of June 30, 2022, and March 31, 2022, we had 28,364,689 shares and 31,965,083 shares of our common stock outstanding, respectively.

Warrants:

As of June 30, 2022, the total outstanding warrants to our employees, directors, and consultants, atpurchase of the Company’s common stock were 10,665,982 with a weighted average exercise price of $1.080.84 per share.

On February 15, 2021, we. There were no new warrants issued a warrant to purchase 265,982 shares of our common stock to our chief executive officer at an exercise price of $1.00 per share.

All of these transactions were exempt from registration underduring the Securities Act of 1933 pursuant to Regulations D or S, or Rule 701, thereunder.

three months ended June 30, 2022. As of SeptemberJune 30, 2021,2022 and March 31, 2021, we had 2022, the weighted average remaining contractual terms were 25,098,4163.86 shares and 24,438,4164.11 shares of our common stock issued and outstanding,years, respectively.

11.8. Employment Agreements

Gert Funk

Mr. Funk has received a grant of options to purchase 500,000Stock- Based Compensation shares of our Common Stock. The options will be issued under our 2018 Stock Incentive Plan (the “2018 Plan”). The options will (i) be incentive stock options, (ii) have an exercise price equal to $1.08 per share, which is the fair market value per share of our Common Stock on March 15, 2021, as determined by an independent valuation by a qualified appraiser, (iii) have a term of 10 years, (iv) vest and become exercisable as to 1/48th of the shares subject to the options on the 15th day of each calendar month during the term of his employment agreement, commencing on April 15, 2021, (v) be subject to the exercise, forfeiture and termination provisions set forth in the 2018 Plan and (vi) otherwise be evidenced by and subject to the terms of our standard form of stock option agreement. Vesting of the options will be accelerated upon a change of control.

He will also receive a cash bonus equal to 2.5% of the net proceeds (i.e., adjusted for our costs) of any initial exchange offering (IEO), token generation event (TGE) or similar financing (a “Token Transaction”) completed on or before the date that is 12 months after the formal acceptance by the Board of a proposal for a Token Transaction (including a start date, milestones and responsibilities). In the event the Board decides to cancel the Token Transaction, Mr. Funk and the Board shall agree upon a mutually acceptable bonus structure in lieu of the foregoing.

ROCKETFUEL BLOCKCHAIN, INC.

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2021

(UNAUDITED)

Peter M. Jensen

Mr. Jensen’s employment agreement initially provided for a base salary of $7,500 per month, which was to increase to $20,000 per month once we had received gross proceeds of at least $2,000,000 in subsequent equity round financings. Our Board determined that the conditions for the salary increase occurred on February 1, 2021. He is also entitled to a performance bonus of $25,000 per calendar quarter based on his achieving quarterly financial and business objectives and milestones to be determined by our board of directors. During the fiscal year ended March 31, 2021, we recorded bonus expense for Mr. Jensen in the amount of $37,500 of which $12,500 was paid in March 2021 and $25,000 was paid in May 2021.

Mr. Jensen also received a grant of options to purchase 2,393,842 shares of our Common Stock. The options will be issued under our 2018 Plan. The options will (i) be incentive stock options, (ii) have an exercise price equal to $1.08 per share, which is the fair market value per share of our Common Stock on September 15, 2020, as determined by an independent valuation by a qualified appraiser, (iii) have a term of 10 years, (iv) vest and become exercisable as to 1/48th of the shares subject to the options on the 15th day of each calendar month during the term of his employment agreement, commencing on October 15, 2020, (v) be subject to the exercise, forfeiture and termination provisions set forth in the 2018 Plan and (vi) otherwise be evidenced by and subject to the terms of our standard form of stock option agreement. Vesting of the options will be accelerated upon a change of control.

Bennett J. Yankowitz

Mr. Yankowitz’s employment agreement provides for a base salary of $5,833 per month on the basis of a commitment of 20 hours per week. He is also entitled to a performance bonus of $7,500 per calendar quarter based on his achieving quarterly business objectives and milestones. In March 2021 he also received a grant of options to purchase 500,000 shares of our Common Stock. The options will be issued under our 2018 Plan. The options will (i) be incentive stock options, (ii) have an exercise price equal $1.08 per share, which is the fair market value per share of our Common Stock on March 1, 2001, as determined by an independent valuation by a qualified appraiser, (iii) have a term of 10 years, (iv) vest and become exercisable as to 1/48th of the shares subject to the options on the 1st day of each calendar month during the term of his employment agreement, commencing on April 1, 2021, (v) be subject to the exercise, forfeiture and termination provisions set forth in the 2018 Plan and (vi) otherwise be evidenced by and subject to the terms of our standard form of stock option agreement.250,000 of the options will become fully vested and exercisable upon the achievement of business objectives and milestones. In addition, vesting of the options will be accelerated upon a change of control.

12. Stock-Based Compensation

Stock Option PlanPlan:

On August 8, 2018, the Board and stockholders holding a majority of our voting power approved the RocketFuel Blockchain, Inc., 2018 Plan, which plan enables us to make awards that qualify as performance-based compensation. Under the terms of the 2018 Plan, the options will (i) be incentive stock options, (ii) have an exercise price equal to the fair market value per share of our common stock on the date of grant as determined by an independent valuation by a qualified appraiser, (iii) have a term of 10 years, (iv) vest and become exercisable pursuant to the terms set forth in the grantees stock option agreement, (v) be subject to the exercise, forfeiture and termination provisions set forth in the 2018 Plan and (vi) otherwise be evidenced by and subject to the terms of our standard form of stock option agreement. We initially reserved 2,000,000 shares of our common stock for issuance in connection with awards under the plan. On September 15, 2020 and March 18, 2021, our board of directors unanimously resolved to amend the 2018 Plan to increase the number of shares of our common stock available for grant to 4,000,000 shares and 6,000,000 shares, respectively. On May 10, 2022, the Board has approved a plan to increase the number of shares to 8,000,000 for 2018 plan. As of SeptemberJune 30, 20212022 and March 31, 20212022, there were 399,4052,176,198 shares and 502,230393,987 shares, respectively, of our common stock available for grant pursuant to the 2018 Plan. As of the date of the filing of this Quarterly Report on Form 10-Q, we had not yet solicited votes from our stockholders to approve the increase in the number of shares of our common stock available for grant pursuant to the 2018 Plan.

ROCKETFUEL BLOCKCHAIN, INC.

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2021

(UNAUDITED)

Service-Based Stock Option Grants

From August 8, 2018 through September 30, 2021, we granted service-based options to employees and consultants, pursuant to the 2018 Plan, exercisable into a total of 5,000,595 shares of our common stock. In determining the fair value of the service-based options granted during the period from August 8, 2018 through September 30, 2021, we utilized the Black-Scholes pricing model utilizing the following assumptions:

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions

During the three months ended September 30, 2021, we granted service-based options pursuant to the 2018 Plan to (i) one employee exercisable into 1,010 shares of our common stock at exercise prices from $1.00 per share to $1.11 per share; and (ii) one consultant exercisable into 100,000 shares of our common stock at an exercise price of $1.08 per share. During the six months ended September 30, 2021, we granted service-based options pursuant to the 2018 Plan to (i) one employee exercisable into 2,825 shares of our common stock at exercise prices from $1.00 per share to $2.75 per share; and (ii) one consultant exercisable into 100,000 shares of our common stock at an exercise price of $1.08 per share. In determining the fair value of the service-based options granted during the three and six months September 30, 2021, we utilized the Black-Scholes pricing model utilizing the following assumptions:

Activity under the 2018 Plan for all service-based stock options for the six months ended September 30, 2021 are as follows:

Schedule of Stock Option Activity

ROCKETFUEL BLOCKCHAIN, INC.

NOTES TO FINANCIAL STATEMENTS

SEPTEMBERJUNE 30, 20212022

(UNAUDITED)

AsService-Based Stock Option Grants

In determining the fair value of Septemberthe service-based options during the three months ended June 30, 2021 and March 31, 2021 there were 2022, we utilized the Black-Scholes pricing model utilizing the following assumptions:

399,405 shares and

502,230 shares, respectively,Schedule of our common stock available for grant pursuant toShare-based Payment Award, Stock Options, Valuation Assumptions

Activity under the 2018 Plan.Plan for all service-based stock options for the three months ended June 30, 2022 are as follows:

Schedule of Stock Option Activity

The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value (the difference between the closing price of the common stock on SeptemberJune 30, 20212022 of $1.100.16 and the exercise price of each in-the-money option) that would have been received by the option holders had all option holders exercised their options on SeptemberJune 30, 2021.2022. There were no service-based stock options exercised under the 2018 Plan for the three and six months ended SeptemberJune 30, 20212022 and 2020.2021.

For the three and six months ended SeptemberJune 30, 2022 and 2021, we recorded stock-based compensation expense for service-based stock options pursuant to the 2018 Plan in the amount of $294,446264,235 and $585,939291,492, respectively. For the three and six months ended September 30, 2020, we recorded no stock-based compensation expense for service-based stock options pursuant to the 2018 Plan. As of SeptemberJune 30, 2021,2022 and March 31, 2022, we had $3,623,0193,015,293 and $3,336,948 of unrecognized stock-based compensation cost related to service-based stock options.options, respectively.

Performance-Based Stock Option Grants

We also granted performance-based options pursuant to the 2018 Plan to Rohan Hall, our chief technology officer, which are exercisable into 600,000 shares of our common stock subject to certain designated milestones. On March 18, 2021, our Board of Directors determined that Mr. Hall earned all of the performance-based options effective February 1, 2021. The Board of Directors also entered into a resolution whereby 75,000 shares of our common stock underlying the performance-based options would vest immediately and 525,000 shares of our common stock underlying the performance-based option would vest ratably over a 48 month48-month period with the first vesting date being February 1, 2021.

ROCKETFUEL BLOCKCHAIN, INC.

NOTES TO FINANCIAL STATEMENTS

JUNE 30, 2022

(UNAUDITED)

In determining the fair value of the performance-based options granted to Mr. Hall on September 14, 2020 and earned effective February 1, 2021, we utilized the Black-Scholes pricing model utilizing the following assumptions:

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions

ROCKETFUEL BLOCKCHAIN, INC.

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2021

(UNAUDITED)

Activity under the 2018 Plan for all performance-based stock options for the sixthree months ended SeptemberJune 30, 20212022 is as follows:

Schedule of Stock Option Activity