XML 29 R13.htm IDEA: XBRL DOCUMENT

Commitments and Contingencies

12 Months Ended

Sep. 30, 2023

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Note 6 Commitments and Contingencies

Lease

The Company leases office space under an operating lease with an initial term of 12 months or less. Under the terms of the office lease, the Company is required to pay its proportionate share of operating costs.

The operating lease costs were as follows (in thousands):

Schedule of operating lease costs
		September 30,
		2023				2022				2021
Operating lease costs		$	118			$	73			$	131

Employee 401(k) Benefit Plan

The Company has a defined-contribution savings plan under Section 401(k) of the Internal Revenue Code. The plan covers all United States based employees. United States based employees eligible to participate in the plan may contribute up to the current statutory limits under the Internal Revenue Service regulations. The 401(k) plan permits the Company to make additional matching contributions on behalf of contributing employees.

During the year ended September 30, 2023, the Company made matching contributions under the 401(k) plan as follows (in thousands):


		September 30,
		2023				2022				2021
Contributions to 401(k) plan		$	232			$	158			$	129

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.

Share Purchase Warrants

At September 30, 2023 and 2022, the Company had 160,000 warrants outstanding at a weighted average exercise price of $3.72 as follows:


Number				Exercise Price				Expiry Date
	150,000			$	3.17				May 6, 2024
	10,000			$	12.00				April 21, 2026
	160,000

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 provided 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 was 6,050,553 shares, subject to adjustment in the event of a change of the Company’s capitalization.

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.

The maximum number of our common shares reserved for issue under the plan was 6,000,000 shares, subject to adjustment in the event of a change of the Company’s capitalization.

During the year ended September 30, 2022, 406,453 options previously available under the 2019 Plan and the 2015 Plan became available under the 2022 Plan (as defined below).

2022 Stock Option Plan

On March 25, 2022, the Board approved the 2022 Omnibus Incentive Plan (the “2022 Plan”). The 2022 Plan was approved by stockholders on May 24, 2022. Under the terms of the 2022 Plan, 10,000,000 additional shares of Common Stock will be available for issuance under the plan, in addition to the shares available under the 2019 Plan and the 2015 Plan. Any awards outstanding under a previous stock option plan will remain subject to and be paid under such plan, and any shares subject to outstanding awards under a previous 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 2022 Plan.

The 2022 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 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 2022 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 2022 Plan. At September 30, 2023, 3,849,917 options had been issued under the 2022 Plan and 6,661,535 options were available for issue under the 2022 Plan, subject to stockholder approval.

The following summarizes information about stock option activity during the years ended September 30, 2023 and 2022:

Schedule of stock option activity
										Weighted
						Weighted Average				Average Grant				Aggregate intrinsic
		Number of				Exercise Price				Date Fair Value				value
		Options				($)				($)				($)
Outstanding, September 30, 2021			11,330,903				5.74				—				140,132,451
Granted			2,358,000				10.13				7.07				—
Forfeited			(118,750	)			6.86				5.23				—
Exercised			(400,537	)			2.52				1.88				4,201,015
Outstanding, September 30, 2022			13,169,616				6.61				4.96				62,267,309
Granted			1,959,000				9.30				6.60				—
Expired			—				—				—				—
Exercised			(759,753	)			2.34				0.95				4,629,026
Forfeited			(257,083	)			12.00				6.74				—
Cancelled			—				—				—				—
Outstanding, September 30, 2023			14,111,780				7.12				5.27				22,290,069
Exercisable, September 30, 2023			9,604,614				5.19				3.94				22,290,069

The following summarizes information about stock options at September 30, 2023 by a range of exercise prices:


												Weighted
												average				Weighted
								Number of				remaining				average								Weighted
Range of exercises prices								outstanding				contractual				exercise				Number of				average
From				To				options				life				price				vested options				exercise price
$	0.92				3.00				3,280,309				4.74				2.39				3,280,309			$	2.39
$	3.01				5.00				2,017,500				4.32				3.28				2,017,500			$	3.28
$	5.01				9.00				5,260,054				6.21				6.90				3,304,137			$	6.10
$	9.01				13.00				1,981,917				8.37				10.55				480,584			$	11.45
$	13.01				25.00				1,572,000				7.49				18.29				522,084			$	18.57
									14,111,780				6.04				7.12				9,604,614			$	5.19

The weighted average per share fair value of options vested during the year ended September 30, 2023 was $3.94 (2022: $4.69, 2021: $2.54). At September 30, 2023, the weighted average contractual life of options outstanding was 6.0 years (2022: 6.4 years) and for options exercisable was 4.75 years (2022: 5.1 years).

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, 2023.

The Company recognized stock-based compensation expense of $16.4 million during the year ended September 30, 2023 (2022: $18.4 million; 2021: $8.2 million) 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 consolidated statements of operations as follows (in thousands):


		September 30,
		2023				2022				2021
General and administrative		$	5,558			$	7,129				3,571
Research and development			10,812				11,250				4,660
Total stock-based compensation		$	16,370			$	18,379				8,231

An amount of approximately $14.1 million in stock-based compensation is expected to be recorded over the remaining term of such options and warrants through fiscal 2026.

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


		2023				2022				2021
Risk-free interest rate			3.70	%			3.11	%			0.73	%
Expected life of options (years)			5.64				5.57				5.74
Annualized volatility			85.13	%			84.17	%			93.43	%
Dividend rate			0.00	%			0.00	%			0.00	%

The fair value of stock compensation charges recognized during the years ended September 30, 2023, 2022 and 2021 was determined with reference to the quoted market price of the Company’s shares on the grant date.