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13. RELATED PARTY TRANSACTIONS | 12 Months Ended
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Sep. 30, 2019
Related Party Transactions [Abstract] |
13. RELATED PARTY TRANSACTIONS | On October 30, 2017, in consideration for an extension of the maturity date of the Series MM and Series NN convertible notes, which had been issued in the prior year, the Company issued a total of 583,057 Series RR warrants to the note holders who agreed to the extension. Geert Kersten, the Company’s Chief Executive Officer, a trust in which Mr. Kersten holds a beneficial interest and Patricia B. Prichep, the Company’s Senior Vice President of Operations received 73,965, 54,585 and 5,459 Series RR warrants, respectively. The Series RR warrants were classified as equity warrants in accordance with ASC 815 and the fair value of the portion attributable to Mr. Kersten, the trust and Ms. Prichep was calculated to be approximately $151,000 on the date of issuance. The terms of the related party notes and warrants were identical to the other participants. On June 11, 2018, Mr. Kersten, the trust and Ms. Prichep converted the outstanding notes payable balances of $250,000, $250,000 and $25,000, respectively, into 147,929, 109,170 and 10,917 shares, respectively, of common stock in accordance with the original conversion terms, which were identical to those of the other participants. To induce conversion of the Series MM and NN Notes, all note holders, including Mr. Kersten, the trust and Ms. Prichep, were issued Series UU warrants in an amount equal to 20% of the shares into which the Notes were convertible. This resulted in the issuance of 29,586, 21,834 and 2,183 Series UU warrants to Mr. Kersten, the trust and Ms. Prichep, respectively. The Series UU warrants had an exercise price of $2.80 per share and expired on June 11, 2018. These terms are identical to the other recipients of the Series UU Warrants. The Company recognized an expense equal to the fair value of the consideration transferred in the transaction in excess of the fair value of consideration issuable under the original conversion terms. The portion of the expense attributed to the fair value of the Series UU warrants issued to Mr. Kersten, the trust and Ms. Prichep was approximately $83,000 and is included as interest expense on the statement of operations for the year ended September 30, 2018. The Series UU warrants qualified for equity treatment in accordance with ASC 815. The Series MM and NN Notes accrued interest at 4%. Upon conversion, the officers elected to receive the accrued interest in shares of common stock instead of cash. On the conversion date in June 2018, the officers converted approximately $19,000 in accrued interest into 6,930 shares of common stock. No other interest payments were made to officers during the years ended September 30, 2019 and 2018. During the year ended September 30, 2019, officers and a director of the Company purchased 45,205 restricted shares of the Company’s common stock at an aggregate market value of approximately $292,000. During the year ended September 30, 2018, officers of the Company purchased 463,855 restricted shares of the Company’s common stock from the Company for an aggregate fair market value of $385,000. The shares are subject to the conditions of Rule 144 under the Securities Act of 1933.

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- Definition The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 850 -URI http://asc.fasb.org/topic&trid=2122745 + Details
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