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Commitments

12 Months Ended

Sep. 30, 2019

Commitments and Contingencies Disclosure [Abstract]

Commitments

Note 5

Commitments

a)

Lease

The Company has entered into an office lease agreement under which it leases office space on a month-to-month basis until March 2020. During the year ended September 30, 2019 the Company incurred office lease expense of $190,416 (2018: $151,405).

b)

Litigation

The Company is subject to claims and legal proceedings that arise in the ordinary course of business. Such matters are inherently uncertain, and there can be no guarantee that the outcome of any such matter will be decided favorably to the Company or that the resolution of any such matter will not have a material adverse effect upon the Company's consolidated financial statements. The Company does not believe that any of such pending claims and legal proceedings will have a material adverse effect on its consolidated financial statements.

c)

Share Purchase Warrants

At September 30, 2019, the Company had outstanding warrants to purchase 350,000 shares of common stock at $4.19 until June 2021. The following table summarizes the warrant activity during the years ended September 30, 2019 and 2018:

						Weighted Average
		Number of Shares				Exercise Price ($)
Balance, September 30, 2017			1,609,309				2.66
Issued			350,000				4.19
Exercised			(756,143	)			2.96
Expired			(524,787	)			3.00
Balance, September 30, 2018			678,379				2.87
Exercised			(8,750	)			1.13
Expired			(319,629	)			1.46
Balance, September 30, 2019			350,000				4.19

During the year ended September 30, 2018, 350,000 options granted to a consultant to the Company were converted to 350,000 warrants with the same exercise price.

During the year ended September 30, 2019, the Company issued 4,938 shares in connection with the exercise of 8,750 warrants on a cashless basis.

During the year ended September 30, 2018, an aggregate of 737,393 warrants at $3.00 per share and 18,750 warrants at $1.24 per share were exercised on a cashless basis, pursuant to which the Company issued 125,748 shares of common stock.

d)

Stock–based Compensation Plan

2015 Stock Option Plan

On September 18, 2015, the Company’s board of directors approved a 2015 Omnibus Incentive Plan (the “2015 Plan”), which provides for the grant of stock options and restricted stock awards to directors, officers, employees and consultants of the Company.

The maximum number of our common shares reserved for issue under the plan is 6,050,553 shares, subject to adjustment in the event of a change of the Company’s capitalization. As a result of the adoption of the 2015 Plan, no further option awards will be granted under any previously existing stock option plan. Stock option awards previously granted under the previously existing stock option plans remain outstanding in accordance with their terms.

The 2015 Plan provides that it may be administered by the board of directors, or the board of directors may delegate such responsibility to a committee. The exercise price will be determined by the board of directors at the time of grant shall be at least equal to the fair market value on such date. If the grantee is a 10% stockholder on the grant date, then the exercise price shall not be less than 110% of fair market value of the Company’s shares of common stock on the grant date. Stock options may be granted under the 2015 Plan for an exercise period of up to ten years from the date of grant of the option or such lesser periods as may be determined by the board, subject to earlier termination in accordance with the terms of the 2015 Plan.

2019 Stock Option Plan

On January 15, 2019, the Board approved the 2019 Omnibus Incentive Plan (the “2019 Plan”), which provides for the grant of stock options and restricted stock awards to directors, officers, employees, consultants and advisors of the Company. Under the terms of the 2019 Plan, 6,000,000 additional shares of Common Stock are available for issuance under the 2019 Plan, in addition to the shares available under the 2015 Plan. Any awards outstanding under the 2015 Plan or the Company’s 2007 Stock Option Plan (the “2007 Plan”) will remain subject to and be paid under the 2015 Plan or the 2007 Plan, respectively, and any shares subject to outstanding awards under the 2015 Plan or the 2007 Plan that subsequently cease to be subject to such awards (other than by reason of settlement of the awards in shares) will automatically become available for issuance under the 2019 Plan.

The 2019 Plan provides that it may be administered by the Board, or the Board may delegate such responsibility to a committee. The exercise price will be determined by the board of directors at the time of grant shall be at least equal to the fair market value on such date. If the grantee is a 10% stockholder on the grant date, then the exercise price shall not be less than 110% of fair market value of the Company’s shares of common stock on the grant date. Stock options may be granted under the 2019 Plan for an exercise period of up to ten years from the date of grant of the option or such lesser periods as may be determined by the board, subject to earlier termination in accordance with the terms of the 2019 Plan.

A summary of the status of Company’s outstanding stock purchase options is presented below:

										Weighted
						Weighted				Average Grant
		Number of				Average Exercise				Date Fair Value				Aggregate intrinsic
		Shares				Price ($)				($)				value
Outstanding, September 30, 2017			5,092,030				4.13						$	5,280,544
Granted			1,730,000				2.71				2.09
Forfeited			(164,280	)			3.66
Exercised			(150,833	)			1.18
Outstanding, September 30, 2018			6,506,917				3.83						$	2,353,088
Granted			2,265,399				2.79				2.27
Forfeited			(309,383	)			3.25
Outstanding, September 30, 2019			8,462,933				3.58						$	4,115,032
Exercisable, September 30, 2019			5,727,963				3.85						$	3,275,500

The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the quoted market price of the Company’s stock for the options that were in-the-money at September 30, 2019.

The Company recognized stock-based compensation expense of $6,430,873 during the year ended September 30, 2019 (2018: $5,517,004) in connection with the issuance and vesting of stock options and warrants in exchange for services. These amounts have been included in general and administrative expenses and research and development expenses on the Company’s statement of operations as follows:

		2019				2018
General and administrative		$	3,203,165			$	2,699,557
Research and development			3,227,708				2,817,447
Total stock-based compensation		$	6,430,873			$	5,517,004

An amount of approximately $5,097,281 in stock-based compensation is expected to be recorded over the remaining term of such options through 2022.

The fair value of each option award is estimated on the date of grant using the Black Scholes option pricing model based on the following weighted average assumptions:

		2019				2018
Risk-free interest rate			2.50	%			2.73	%
Expected life of options (years)			6.05				5.60
Annualized volatility			104.45	%			106.45	%
Dividend rate			0.00	%			0.00	%

The fair value of stock compensation charges recognized during the years ended September 30, 2019 and 2018 was determined with reference to the quoted market price of the Company’s shares on the grant date.