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Commitments

6 Months Ended

Mar. 31, 2019

Commitments and Contingencies Disclosure [Abstract]

Commitments

Note 5

Commitments

a) 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.

b) Share Purchase Warrants

A summary of the status of the Company’s outstanding share purchase warrants is presented below:

							Weighted
							Average
			Number of Shares				Exercise Price
Balance, October 1, 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				(1,250	)		$	1.68
Expired				(307,129	)		$	1.47
Balance, March 31, 2019				370,000			$	4.03

During the six months ended March 31, 2019, the Company issued 546 shares in connection with the exercise of 1,250 share purchase warrants on a cashless basis.

c) 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.

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

							Weighted				Weighted
			Number of				Average				Average Grant				Aggregate
			Shares				Exercise Price				Date Fair Value				intrinsic value
Outstanding at October 1, 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 at September 30, 2018				6,506,917			$	3.83							$	2,353,088
Granted				1,030,399			$	2.45			$	1.97
Forfeited				(238,966	)		$	2.86
Outstanding at March 31, 2019				7,298,350			$	3.67							$	3,642,978
Exercisable at March 31, 2019				5,240,285			$	3.73							$	2,976,021

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 March 31, 2019.

During the three and six months ended March 31, 2019, the Company recognized stock-based compensation expense in connection with the issuance and vesting of stock options 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:

		Three months ended March 31,								Six months ended March 31,
		2019				2018				2019				2018
General and administrative		$	950,999			$	625,679			$	2,006,587			$	1,197,041
Research and development			942,153				600,017				1,953,552				1,150,640
Total share based compensation		$	1,893,152			$	1,225,696			$	3,960,139			$	2,347,681

An amount of approximately $4,546,000 in stock-based compensation is expected to be recorded over the remaining term of such options through June 2021.

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			2.91	%			2.43	%
Expected life of options (years)			5.59				6.57
Annualized volatility			105.96	%			112.23	%
Dividend rate			0.00	%			0.00	%