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14. STOCK-BASED COMPENSATION | 3 Months Ended
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Dec. 31, 2023
Equity [Abstract] |
STOCK-BASED COMPENSATION | STOCK-BASED COMPENSATION The Company sponsors a stock-based incentive compensation plan known as the 2017 Incentive Plan (the “Plan”), which was established by the Board of Directors of the Company on June 19, 2017. As of September 2022, an aggregate of 3,500,000 shares of common stock were authorized for issuance under the Plan. In March 2023, the stockholders approved an amendment to the Plan, as amended to date, to (i) increase the number of shares authorized for issuance thereunder from 3,500,000 shares of common stock to 11,512,000 shares and (ii) add an evergreen provision to, on April 1st and October 1st of each year, automatically increase the maximum number of shares of common stock available under the Plan to fifteen percent (15% ) of the Company's outstanding shares of common stock, in each case as of the last day of the immediately preceding month. On April 1, 2023, the total shares authorized for issuance under the Plan increased to 14,542,583 and subsequently on October 1, 2023, there were 160,184,921 outstanding shares of common stock, and accordingly the total shares authorized for issuance under the Plan increased to 24,027,738. As of December 31, 2023, after giving effect to the evergreen provision there were 10,025,740 shares available and authorized for issuance under the Plan. STOCK OPTIONS The following is a summary of stock option activity during the three months ended December 31, 2023:
|  | Number of Option Shares |  |  | Weighted Average Exercise Price ($) |
Balance, September 30, 2023 |  |  | 1,970,458 |  |  | $ | 14.86 |
Options granted |  |  | 65,000 |  |  | $ | 6.16 |
Options expired |  |  | (80,236 | ) |  | $ | 8.88 |
Options canceled/forfeited |  |  | (17,823 | ) |  | $ | 5.36 |
Options exercised |  |  | (6,096 | ) |  | $ | 5.91 |
Balance, December 31, 2023 |  |  | 1,931,303 |  |  | $ | 14.93 |
As of December 31, 2023, there were options exercisable to purchase 1,138,068 shares of common stock in the Company and 793,235 unvested options outstanding that cannot be exercised until vesting conditions are met. As of December 31, 2023, the outstanding options have a weighted average remaining term of 1.18 years and an intrinsic value of $4,600. For the three months ended December 31, 2023, the Company also granted 65,000 options to purchase shares of common stock to employees with a total fair value of $388. The Black-Scholes model utilized the following inputs to value the options granted during the three months ended December 31, 2023:
Fair value assumptions Options: |  | December 31, 2023 |
Risk free interest rate |  | 3.94% - 4.82% |
Expected term (years) |  |  | 5.77 |
Expected volatility |  |  | 176 | %
Expected dividends |  |  | 0 | %
The Company recognized stock-based compensation expense relating to stock options of $1,812 and $1,657 for the three months ended December 31, 2023 and 2022. As of December 31, 2023, the Company expects to recognize $5,540 of stock-based compensation for the non-vested outstanding options over a weighted-average period of 1.79 years. RESTRICTED STOCK UNITS The Company grants restricted stock units ("RSU"s) that contain either a) service conditions, b) performance conditions, or c) market performance conditions. RSUs containing service conditions vest monthly or annually. RSUs containing performance conditions generally vest over 1 year, and the number of shares earned depends on the achievement of predetermined Company metrics. RSUs that contain market conditions will vest based on the terms of the agreement and generally are either 1 year or over the employee's term of employment. The Company recognizes the expense equal to the total fair value of the RSUs on the grant date. The time-based RSUs granted were valued equal the stock price on the grant date and the value of market-based RSUs are valued utilizing the monte-carlo valuation model. The expense is recognized ratably over the service period. The following table summarizes the activity for all RSUs during the three months ended December 31, 2023:
|  | Number of Shares |  |  | Weighted Average Fair Value Per Share |  |  | Aggregate Intrinsic Value |
Outstanding at September 30, 2023 |  |  | 5,471,435 |  |  | $ | 4.18 |  |  | $ | 20,846 |
Granted |  |  | 209,972 |  |  |  | 3.81 |  |  |  |
Vested |  |  | (1,404,754 | ) |  |  | 3.94 |  |  |  |
Cancelled |  |  | - |  |  |  | - |  |  |  |
Forfeited |  |  | (2,504 | ) |  |  | 4.15 |  |  |  |
Outstanding at December 31, 2023 |  |  | 4,274,149 |  |  | $ | 4.24 |  |  | $ | 47,144 |
On September 29, 2023, the Compensation Committee granted 3,460,000 market-based restricted stock units to senior leadership of the Company. A 33% tranche of the market-based awards vest based upon the Company's stock price reaching 200%, 300% and 400% of the stock price on the date of grant. Each tranche will vest upon the target stock price being met for at least 10 of 20 consecutive trading days and the awards are not dependent on a defined service period. The total fair value of the award is approximately $13,160 and is amortized over a weighted average period of less than 1 year. Any unvested market-based RSUs will expire on September 29, 2033. On October 1, 2023, the Company granted 209,972 time-based RSUs to its board members as part of their annual compensation. These RSUs vest 25% each quarter-end and have a combined grant-date fair value of $800. The first vesting occurred on December 31, 2023 and the 52,492 shares were settled and issued in January 2024. As of December 31, 2023, the Company had 1,967,480 outstanding unvested time-based restricted stock awards and 2,306,669 outstanding unvested market-based restricted stock awards. 50% of the time-based awards will vest on September 12, 2024 and 50% on September 12, 2025. As of September 30, 2023, the Company had 196,435 performance based awards that were unvested. During the quarter ended December 31, 2023 193,931 performance based awards vested in October 2023 when the Company achieved its exahash target rate of 10.0 and 2,504 performance based awards were forfeited due to termination. The Company recognized stock-based compensation expense relating to restricted stock units of $8,141 and $4,221 for the three months ended December 31, 2023 and 2022. As of December 31, 2023, the Company had $14,801 in unrecognized compensation costs related to all RSU awards that it expects to recognize over a weighted average period of 1.27 years.

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