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STOCKHOLDERS EQUITY | 9 Months Ended
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Jun. 30, 2024
STOCKHOLDERS EQUITY |
STOCKHOLDERS' EQUITY | C. STOCKHOLDERS’ EQUITY Proceeds from the Sale of Common Stock In February 2024, the Company sold 3,875,000 shares of common stock at a public offering price of $2.00 per share and received proceeds of approximately $7.0 million, net of issuance costs of approximately $0.7 million. In November 2023, the Company sold 2,490,000 shares of common stock at a public offering price of $2.00 per share and received proceeds of approximately $4.5 million, net of issuance costs of approximately $0.5 million. In April 2023, the Company sold 794,117 shares of common stock at a public offering price of $1.70 per share and received proceeds of approximately $1.4 million. The Company granted the underwriters a 30-day option to purchase up to 119,117 additional shares of common stock to cover over-allotments. The underwriter fully exercised this option in May 2023, resulting in additional proceeds to the Company of approximately $200,000. The Company incurred issuance costs of approximately $0.2 million related to this offering. Equity Compensation Underlying share information for equity compensation plans as of June 30, 2024 is as follows:
Name of Plan |  | Total Shares Reserved Under Plans |
Incentive Stock Option Plans |  |  | 138,400 |
Non-Qualified Stock Option Plans |  |  | 17,787,200 |
Stock Bonus Plans |  |  | 1,283,760 |
Stock Compensation Plans |  |  | 634,000 |
Incentive Stock Bonus Plan |  |  | 640,000 |
Stock option activity:
|  | Nine months ended June 30, |
|  | 2024 |  |  | 2023 |
Options granted |  |  | 1,967,500 |  |  |  | 6,500 |
Options exercised |  |  | - |  |  |  | - |
Options forfeited |  |  | 293,000 |  |  |  | 179,832 |
Options expired |  |  | 27,075 |  |  |  | 58,787 |
|  | Three Months Ended June 30, |
|  | 2024 |  |  | 2023 |
Options granted |  |  | 1,964,500 |  |  |  | 2,000 |
Options exercised |  |  | - |  |  |  | - |
Options forfeited |  |  | 240,000 |  |  |  | 57,500 |
Options expired |  |  | 40 |  |  |  | 13,383 |
On March 1, 2024, the Company accelerated the vesting of 234,332 stock options issued to directors to vest on April 19, 2024. The Company concluded that the change in vesting of the options should be treated as a modification in accordance with ASC 718. As such, the Company revalued the options as of March 1, 2024 (the modification date) and subtracted any compensation cost already recognized prior to the modification date. This resulted in remaining compensation cost of approximately $260,000 that was amortized on a straight-line basis over the remaining service period. The remaining compensation cost of approximately $101,000 as of March 31, 2024 was expensed during the three months ended June 30, 2024. Share-Based Compensation Expense:
|  | Nine months ended June 30, |
|  | 2024 |  |  | 2023 |
Employees |  | $ | 3,544,569 |  |  | $ | 4,976,338 |
Non-employees |  | $ | 600,841 |  |  | $ | 473,723 |
|  | Three Months Ended June 30, |
|  | 2024 |  |  | 2023 |
Employees |  | $ | 728,120 |  |  | $ | 1,540,219 |
Non-employees |  | $ | 230,678 |  |  | $ | 188,001 |
Employee compensation expense includes the expense related to options and restricted stock that is expensed over the vesting periods. Non-employee expense includes the expense related to options and stock issued to consultants expensed over the period of the related service contracts. Warrants and Non-Employee Options The following chart represents the warrants and non-employee options outstanding at June 30, 2024:
Warrant/ Options |  | Issue Date |  | Shares Issuable upon Exercise of Warrants/ Options |  |  | Exercise Price |  |  | Expiration Date |
Series N |  | 8/18/2008 |  |  | 85,339 |  |  | $ | 3.00 |  |  | 8/18/2026 |
Series UU |  | 6/11/2018 |  |  | 93,603 |  |  | $ | 2.80 |  |  | 6/30/2026 |
Series X |  | 1/13/2016 |  |  | 120,000 |  |  | $ | 9.25 |  |  | 7/13/2026 |
Series Y |  | 2/15/2016 |  |  | 26,000 |  |  | $ | 12.00 |  |  | 8/15/2026 |
Series MM |  | 6/22/2017 |  |  | 333,432 |  |  | $ | 1.86 |  |  | 6/22/2026 |
Series NN |  | 7/24/2017 |  |  | 200,087 |  |  | $ | 2.52 |  |  | 7/24/2026 |
Series RR |  | 10/30/2017 |  |  | 234,009 |  |  | $ | 1.65 |  |  | 10/30/2026 |
Consultant Options |  | 7/28/2017 – 9/2/2023 |  |  | 110,000 |  |  |  | $1.39- $2.18 |  |  | 7/27/2027 - 9/1/2028 |
1. Equity Warrants Changes in Equity Warrants No warrants recorded as equity were exercised during the nine months ended June 30, 2024. The following warrants recorded as equity were exercised during the nine months ended June 30, 2023.
Warrants |  | Warrants Exercised |  |  | Exercise Price |  |  | Proceeds |
Series RR |  |  | 17,752 |  |  | $ | 1.65 |  |  | $ | 29,291 |
Series SS |  |  | 200,000 |  |  | $ | 2.09 |  |  |  | 418,000 |
|  |  | 217,752 |  |  |  |  |  |  | $ | 447,291 |
No warrants recorded as equity expired during the nine and three months ended June 30,2024. On February 5, 2023, 600 Series TT warrants, with an exercise price of $2.24, expired. On May 4, 2024, the Company modified the terms of Series UU, X, Y, N, MM, NN and RR warrants by extending the expiration dates by twenty-four (24) months from their current expiration dates. The incremental cost of this extension was approximately $659,455, which was recorded as a deemed dividend in the financial statements for the nine and three months ended June 30, 2024. The Series N, X, MM, NN, RR and UU warrants are held by current Officers of the Company. On October 28, 2022, the expiration date of the Series RR warrants was extended two years from October 30, 2022 to October 30, 2024. The incremental cost of this extension was approximately $172,000, which was recorded as a deemed dividend. The Series RR warrants are held by current Officers of the Company. 2. Options and Shares Issued to Consultants During the nine months ended June 30, 2024 and 2023, the Company issued 321,761 and 115,321 shares, respectively, of restricted common stock to consultants for services. The weighted average grant date fair value of the shares issued to consultants was $1.84 and $2.45 during the nine months ended June 30, 2024 and 2023, respectively. During the three months ended June 30, 2024 and 2023, the Company issued 70,444 and 36,523 shares, respectively, of restricted common stock to consultants for services. The weighted average grant date fair value of the shares issued to consultants was $1.33 and $2.41 during the three months ended June 30, 2024 and 2023, respectively. No options were issued to a consultant during the nine months ended June 30, 2024. During the nine months ended June 30, 2023, 5,000 options with an exercise price of $11.61 issued to a consultant expired. During the nine months ended June 30, 2024 and 2023, the Company recorded total expense of approximately $601,000 and $474,000, respectively, relating to the share-based compensation under various consulting agreements. During the three months ended June 30, 2024 and 2023, the Company recorded total expense of approximately $231,000 and $188,000, respectively, relating to the share-based compensation under these consulting agreements. On June 30, 2024 and September 30, 2023, consulting fees of approximately $221,000 and $205,000, respectively, are included in current assets as prepaid expenses and will be amortized over the remaining service periods.

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