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Common Stock, Stock Options and Warrants | 12 Months Ended
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Sep. 30, 2020
Stockholders' Equity Note [Abstract] |
COMMON STOCK, STOCK OPTIONS AND WARRANTS | 6. COMMON STOCK, STOCK OPTIONS AND WARRANTS Common Stock Issued for Services On February 13, 2019, the Company issued 125,000 shares of common stock for investor relations services and expensed the $117,500 fair value of the common stock issued. On September 16, 2019, the Company issued 94,097 shares of common stock for investor relations services and expensed the $94,097 fair value of the common stock issued. On November 4, 2019, the Company issued 186,566 shares of common stock for strategic consulting and corporate development services and expensed the $100,000 fair value of the common stock issued. On February 10, 2020, the Company issued 150,000 shares of common stock for investor relations services and 136,000 shares of common stock for general advisory and business development advisory services. The Company expensed the $306,020 fair value of the common stock issued. On April 6, 2020, the Company issued 50,000 shares of common stock for strategic consulting and corporate development services and expensed the $22,750 fair value of the common stock issued. On September 8, 2020, the Company issued 101,174 shares of common stock for investor relations services and expensed the $100,000 fair value of the common stock issued. Common Stock Offerings On April 3, 2019, the Company closed a registered direct offering with several institutional and accredited investors for the sale of 3,430,421 shares of common stock at $1.545 per share for gross proceeds of $5,300,001. Simultaneously, the Company also privately sold and issued 3,430,421 immediately exercisable two-year unregistered warrants to the investors with an exercise price of $1.42 per share. The Company paid the placement agent a fee of 7% of the gross proceeds totaling $371,000 and issued the placement agent 240,130 immediately exercisable two-year warrants with an exercise price of $1.93125 per share. The Company also reimbursed the placement agent for $85,000 in expenses and incurred $10,000 in other expenses. Net proceeds from the offering were $4,834,001. The estimated fair value of the 3,430,421 warrants issued to the investors was $2,709,467 and the estimated fair value of the 240,130 warrants issued to the placement agent was $169,854. On September 27, 2019, Citius closed an underwritten at-the-market offering of (i) 6,760,615 units, each unit consisting of one share of common stock and one immediately exercisable five-year warrant to purchase one share at $0.77 per share, and (ii) 1,060,615 pre-funded units, each pre-funded unit consisting of one pre-funded warrant to purchase one share and one immediately exercisable five-year warrant to purchase one share at $0.77 per share. The pre-funded warrants included in the pre-funded units are immediately exercisable at a price of $0.0001 per share and do not expire. The offering price was $0.8951 per unit and $0.895 per pre-funded unit. The net proceeds of the offering were $6,290,335. The Company issued the underwriter immediately exercisable five-year warrants to purchase up to 547,486 shares at $1.118875 per share with an estimated fair value of $323,414. The estimated fair value of the 1,060,615 pre-funded warrants was $809,145, and the estimated fair value of the 7,821,230 warrants included in the units and the pre-funded units issued to the investors was $4,845,341. On May 18, 2020, the Company closed a registered direct offering with several institutional and accredited investors for the sale of 7,058,824 shares of common stock at $1.0625 per share for gross proceeds of $7,500,001. The Company also agreed to issue 3,529,412 unregistered immediately exercisable warrants to the investors with an exercise price of $1.00 per share and a term of five and one-half years. The Company paid the placement agent for the offering a fee of 7% of the gross proceeds totaling $525,000 and issued the placement agent 494,118 immediately exercisable warrants with an exercise price of $1.3281 per share and a term of five years. The Company also reimbursed the placement agent for $85,000 in expenses and incurred $12,901 in other expenses. Net proceeds from the offering were $6,877,100. The estimated fair value of the 3,529,412 warrants issued to the investors was $2,138,998 and the estimated fair value of the 494,118 warrants issued to the placement agent was $275,724. On August 10, 2020, the Company closed an underwritten public offering of 9,159,524 shares of common stock at a price of $1.05 per share for gross proceeds of $9,617,500. The Company paid the underwriter a fee of 7% of the gross proceeds totaling $673,225 and issued the underwriters 641,166 immediately exercisable warrants with an exercise price of $1.3125 per share and a term of five years. The Company also reimbursed the placement agent for $135,000 in expenses and incurred $109,074 in other expenses. Net proceeds from the offering were $8,700,201. The estimated fair value of the 641,166 warrants issued to the underwriter was $569,426. Stock Option Plans Pursuant to its 2014 Stock Incentive Plan (the "2014 Plan") the Company reserved 866,667 shares of common stock for issuance to employees, directors and consultants. The Board of Directors (or committees and/or executive officers delegated by the Board of Directors) may grant stock options, stock appreciation rights, restricted stock, restricted stock units, other stock-based awards and cash-based awards. As of September 30, 2020, there were options to purchase 855,171 shares outstanding, options to purchase 4,829 shares were exercised, options to purchase 6,667 shares expired, and no shares were available for future grants. On February 7, 2018, our stockholders approved the 2018 Omnibus Stock Incentive Plan (the "2018 Plan") and the Company reserved 2,000,000 shares of common stock for issuance to employees, directors and consultants. Pursuant to the 2018 Plan, the Board of Directors (or committees and/or executive officers delegated by the Board of Directors) may grant stock options, stock appreciation rights, restricted stock, restricted stock units, other stock-based awards and cash-based awards. As of September 30, 2020, there were options to purchase 1,890,000 shares outstanding and no shares available for future grants. On February 10, 2020, the Company's stockholders approved the 2020 Omnibus Stock Incentive Plan ("2020 Plan"). The 2020 Plan authorizes a maximum of 3,110,000 shares. The 2020 Plan provides incentives to employees, directors, and consultants of the Company in the form of granting an option, SAR, dividend equivalent right, restricted stock, restricted stock unit, or other right or benefit under the 2020 Plan. As of September 30, 2020, there were options to purchase 645,000 shares outstanding under the 2020 Plan and 2,465,000 shares available for future grants. The fair value of each stock option award is estimated on the date of grant using the Black-Scholes option pricing model. Due to its limited operating history and limited number of sales of its common stock, the Company estimated its volatility in consideration of a number of factors including the volatility of comparable public companies through December 31, 2018. Since January 1, 2019, the Company has estimated its volatility using the trading activity of its common stock. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant commensurate with the expected term assumption. The expected term of stock options granted to employees and directors, all of which qualify as "plain vanilla," is based on the average of the contractual term (generally 10 years) and the vesting period. For non-employee options, the expected term is the contractual term. The following assumptions were used in determining the fair value of stock option grants for the years ended September 30, 2020 and 2019:
|  | 2020 |  | 2019 |
Risk-free interest rate |  | 0.26 – 1.66% |  | 2.18 – 2.53% |
Expected dividend yield |  | 0% |  | 0% |
Expected term |  | 6.50 – 10 years |  | 6.50 – 10 years |
Expected volatility |  | 107 – 117% |  | 119 – 121% |
A summary of option activity under the plans is presented below:
|  | Shares |  |  | Weighted- Average Exercise Price |  |  | Weighted- Average Remaining Contractual Term |  |  | Aggregate Intrinsic Value |
Outstanding at September 30, 2019 |  |  | 1,771,039 |  |  | $ | 4.03 |  |  |  |  |  |  |  |
Granted |  |  | 1,625,799 |  |  |  | 0.89 |  |  |  |  |  |  |  |
Exercised |  |  | — |  |  |  | — |  |  |  |  |  |  |  |
Forfeited or expired |  |  | (6,667 | ) |  |  | 9.00 |  |  |  |  |  |  |  |
Outstanding at September 30, 2020 |  |  | 3,390,171 |  |  | $ | 2.51 |  |  | 8.00 years |  |  | $ | 440,336 |
Exercisable at September 30, 2020 |  |  | 1,507,141 |  |  | $ | 4.44 |  |  | 6.56 years |  |  | $ | 72,566 |
The weighted average grant date fair value of the options granted during the year ended September 30, 2019 was estimated at $1.04 per share. These options vest over terms of 12 to 36 months and have a term of 10 years. The weighted average grant date fair value of the options granted during the year ended September 30, 2020 was estimated at $0.76 per share. All of these options vest over terms of 12 to 36 months and have a term of 10 years. Stock-based compensation expense for the years ended September 30, 2020 and 2019 was $803,261 and $715,983, respectively. At September 30, 2020, unrecognized total compensation cost related to unvested awards of $1,166,073 is expected to be recognized over a weighted average period of 1.90 years. Warrants The Company has reserved 26,831,989 shares of common stock for the exercise of outstanding warrants. The following table summarizes the warrants outstanding at September 30, 2020:
|  | Exercise price |  |  | Number |  |  | Expiration Dates |
Investor Warrants |  | $ | 9.00 |  |  |  | 307,778 |  |  | November 5, 2020 – April 25, 2021 |
LMB Warrants |  |  | 6.15 |  |  |  | 38,771 |  |  | November 20, 2020 – March 2, 2021 |
LMB Warrants |  |  | 7.50 |  |  |  | 38,673 |  |  | November 2, 2020 – March 14, 2021 |
LMB Warrants |  |  | 7.50 |  |  |  | 53,110 |  |  | March 24, 2022 – April 29, 2022 |
Financial Advisor Warrants |  |  | 3.00 |  |  |  | 25,833 |  |  | August 15, 2021 |
2016 Offering Warrants |  |  | 4.13 |  |  |  | 140,819 |  |  | November 23, 2021 – February 27, 2022 |
2017 Public Offering Warrants |  |  | 4.13 |  |  |  | 1,622,989 |  |  | August 2, 2022 |
2017 Public Offering Underwriter Warrants |  |  | 4.54 |  |  |  | 65,940 |  |  | February 2, 2023 |
December 2017 Registered Direct/Private Placement Offering Investor Warrants |  |  | 4.63 |  |  |  | 640,180 |  |  | June 19, 2023 |
December 2017 Registered Direct/Private Placement Offering Agent Warrants |  |  | 5.87 |  |  |  | 89,625 |  |  | December 19, 2022 |
March 2018 Registered Direct/Private Placement Offering Investor Warrants |  |  | 2.86 |  |  |  | 218,972 |  |  | October 2, 2023 |
March 2018 Registered Direct/Private Placement Offering Agent Warrants |  |  | 3.73 |  |  |  | 46,866 |  |  | March 28, 2023 |
August 2018 Offering Investor Warrants |  |  | 1.15 |  |  |  | 7,843,138 |  |  | August 14, 2023 |
August 2018 Offering Agent Warrants |  |  | 1.59 |  |  |  | 549,020 |  |  | August 8, 2023 |
April 2019 Registered Direct/Private Placement Offering Investor Warrants |  |  | 1.42 |  |  |  | 1,294,498 |  |  | April 5, 2021 |
April 2019 Registered Direct/Private Placement Offering Placement Agent Warrants |  |  | 1.93 |  |  |  | 240,130 |  |  | April 5, 2021 |
September 2019 Offering Investor Warrants |  |  | 0.77 |  |  |  | 2,793,297 |  |  | September 27, 2024 |
September 2019 Offering Underwriter Warrants |  |  | 1.12 |  |  |  | 547,486 |  |  | September 27, 2024 |
February 2020 Exercise Agreement Warrants |  |  | 1.02 |  |  |  | 6,298,673 |  |  | August 19, 2025 |
February 2020 Exercise Agreement Placement Agent Warrants |  |  | 1.28 |  |  |  | 440,907 |  |  | August 19,2025 |
May 2020 Registered Direct Offering Investor Warrants |  |  | 1.00 |  |  |  | 2,400,000 |  |  | November 18, 2025 |
May 2020 Registered Direct Offering Placement Agent Warrants |  |  | 1.33 |  |  |  | 494,118 |  |  | May 14, 2025 |
August 2020 Underwriter Warrants |  |  | 1.31 |  |  |  | 641,166 |  |  | August 10, 2025 |
|  |  |  |  |  |  | 26,831,989 |  |  |  |
During the year ended September 30, 2019, 2,321,569 August 2018 offering pre-funded unit warrants were exercised at $0.01 per share for net proceeds of $23,216. In December 2019, 1,060,615 of the September 2019 Offering Pre-Funded Unit Warrants were exercised at $0.0001 per share for net proceeds of $106. In January 2020, 1,315,715 of the September 2019 Offering Investor Warrants were exercised at $0.77 per share for net proceeds of $1,013,101. On February 14, 2020, the Company entered into a warrant exercise agreement for an aggregate of 3,712,218 shares of common stock having an existing exercise price of $0.77 and 2,586,455 shares of common stock at a reduced exercise price of $1.02. In consideration for the exercise of the warrants for cash, the exercising holders received new unregistered warrants to purchase 6,298,673 shares of common stock at an exercise price of $1.02 per share, exercisable six months after issuance and which have a term of exercise equal to five years. The offering closed on February 19, 2020 and net proceeds were $5,013,930 after placement agent fees and offering expenses. The Company also issued warrants to purchase 440,907 shares to the placement agent. The placement agent warrants have identical terms to the investor warrants except that the exercise price is $1.275 per share. The estimated fair value of the 6,298,673 warrants issued to the investors was $5,360,465 and the estimated fair value of the 440,907 warrants issued to the placement agent was $367,022. On June 26, 2020, 1,129,412 of the May 2020 Registered Direct Offering Investor Warrants were exercised at $1.00 per share for net proceeds of $1,129,412. At September 30, 2020, the weighted average remaining life of all of the outstanding warrants is 3.55 years, all warrants are exercisable, and the aggregate intrinsic value for the warrants outstanding was $976,164. Common Stock Reserved A summary of common stock reserved for future issuances as of September 30, 2020 is as follows:
Stock plan options outstanding |  |  | 3,390,171 |
Stock plan shares available for future grants |  |  | 2,465,000 |
Warrants outstanding |  |  | 26,831,989 |
Total |  |  | 32,687,160 |
The three-year unit purchase options issued during the year ended September 30, 2017 expired during the year ended September 30, 2020.

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- Definition The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(e)(1)) -URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.3-04) -URI http://asc.fasb.org/extlink&oid=120397183&loc=d3e187085-122770 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -URI http://asc.fasb.org/topic&trid=2208762 + Details
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