STOCKHOLDERS EQUITY

6 Months Ended

Mar. 31, 2024

STOCKHOLDERS EQUITY

STOCKHOLDERS' EQUITY

C. STOCKHOLDERS’ EQUITY

Proceeds from the Sale of Common Stock

In February 2024, the Company sold 3,875,000 shares of common stock at a public offering price of $2.00 per share and received proceeds of approximately $7.0 million, net of issuance costs of approximately $0.7 million.

In November 2023, the Company sold 2,490,000 shares of common stock at a public offering price of $2.00 per share and received proceeds of approximately $4.5 million, net of issuance costs of approximately $0.5 million.

Equity Compensation

Underlying share information for equity compensation plans as of March 31, 2024 is as follows:

Name of Plan	Total Shares Reserved Under Plans
Incentive Stock Option Plans		138,400
Non-Qualified Stock Option Plans		15,787,200
Stock Bonus Plans		1,283,760
Stock Compensation Plans		634,000
Incentive Stock Bonus Plan		640,000

Stock option activity:

	Six Months Ended March 31,
	2024		2023
Options granted		3,000		4,500
Options exercised		-		-
Options forfeited		53,000		122,332
Options expired		27,035		45,404

	Three Months Ended March 31,
	2024		2023
Options granted		3,000		2,000
Options exercised		-		-
Options forfeited		42,000		25,500
Options expired		27,035		4

On March 1, 2024, the Company accelerated the vesting of 234,332 stock options issued to directors to vest on April 19, 2024. The Company concluded that the change in vesting of the options should be treated as a modification in accordance with ASC 718. As such, the Company revalued the options as of March 1, 2024 (the modification date) and subtracted any compensation cost already recognized prior to the modification date. This resulted in remaining compensation cost of approximately $260,000 that will be amortized on a straight-line basis over the remaining service period.

Share-Based Compensation Expense:

	Six Months Ended March 31,
	2024		2023
Employees	$	2,816,449	$	3,436,119
Non-employees	$	370,163	$	285,722

	Three Months Ended March 31,
	2024		2023
Employees	$	1,432,540	$	1,743,288
Non-employees	$	151,777	$	136,864

Employee compensation expense includes the expense related to options and restricted stock that is expensed over the vesting periods. Non-employee expense includes the expense related to options and stock issued to consultants expensed over the period of the related service contracts.

Warrants and Non-Employee Options

The following chart represents the warrants and non-employee options outstanding at March 31, 2024:

Warrant/ Options	Issue Date	Shares Issuable upon Exercise of Warrants/ Options		Exercise Price		Expiration Date
Series N	8/18/2008		85,339	$	3.00	8/18/2024
Series UU	6/11/2018		93,603	$	2.80	6/30/2024
Series X	1/13/2016		120,000	$	9.25	7/13/2024
Series Y	2/15/2016		26,000	$	12.00	8/15/2024
Series MM	6/22/2017		333,432	$	1.86	6/22/2024
Series NN	7/24/2017		200,087	$	2.52	7/24/2024
Series RR	10/30/2017		234,009	$	1.65	10/30/2024
Consultant Options	7/28/2017 – 9/2/2023		110,000	$	1.39 - $2.18	7/27/2027 -  9/1/2028

1. Equity Warrants

Changes in Equity Warrants

No warrants recorded as equity were exercised during the six months ended March 31, 2024. The following warrants recorded as equity were exercised during the six months ended March 31, 2023.

Warrants	Warrants Exercised		Exercise Price		Proceeds
Series RR		17,752	$	1.65	$	29,291
Series SS		200,000	$	2.09		418,000
		217,752			$	447,291

No warrants recorded as equity expired during the six and three months ended March 31 ,2024. On February 5, 2023, 600 Series TT warrants, with an exercise price of $2.24, expired.

No warrants recorded as equity were extended during the six and three months ended March 31, 2024. On October 28, 2022, the expiration date of the Series RR warrants was extended two years from October 30, 2022 to October 30, 2024. The incremental cost of this extension was approximately $172,000, which was recorded as a deemed dividend in the financial statements for the three months ended December 31, 2022. The Series RR warrants are held by Geert Kersten, Patricia Prichep (current Officers of the Company) and the de Clara Trust, of which the Company’s CEO, Geert Kersten, is a beneficiary.

2. Options and Shares Issued to Consultants

During the six months ended March 31, 2024 and 2023, the Company issued 251,317 and 78,798 shares, respectively, of restricted common stock to consultants for services. The weighted average grant date fair value of the shares issued to consultants was $1.99 and $2.47 during the six months ended March 31, 2024 and 2023, respectively. During the three months ended March 31, 2024 and 2023, the Company issued 162,744 and 38,562 shares, respectively, of restricted common stock to consultants for services. The weighted average grant date fair value of the shares issued to consultants was $2.22 and $2.42 during the three months ended March 31, 2024 and 2023, respectively.

No options were issued to a consultant during the six months ended March 31, 2024. During the six months ended March 31, 2023, 5,000 options with an exercise price of $11.61 issued to a consultant expired.

During the six months ended March 31, 2024 and 2023, the Company recorded total expense of approximately $370,000 and $285,000, respectively, relating to the share-based compensation under various consulting agreements. During the three months ended March 31, 2024 and 2023, the Company recorded total expense of approximately $152,000 and $136,000, respectively, relating to the share-based compensation under these consulting agreements. On March 31, 2024 and September 30, 2023, consulting fees of approximately $351,000 and $205,000, respectively, are included in current assets as prepaid expenses and will be amortized over the remaining service periods.