XML 21 R12.htm IDEA: XBRL DOCUMENT v3.24.0.1
Common Stock, Stock Options and Warrants
 3 Months Ended
Dec. 31, 2023
Common Stock, Stock Options and Warrants [Abstract]  
COMMON STOCK, STOCK OPTIONS AND WARRANTS

5. COMMON STOCK, STOCK OPTIONS AND WARRANTS

 

Common Stock Issued for Services

 

On October 10, 2023, the Company issued 108,778 shares of common stock for media, and public and investor relations services and expensed the $76,146 fair value of the common stock issued.

 

Stock Option Plans

 

Pursuant to our 2014 Stock Incentive Plan, we reserved 866,667 shares of common stock. As of December 31, 2023, there were options to purchase 795,171 shares outstanding, options to purchase 4,829 shares were exercised, options to purchase 66,667 shares expired, and no shares were available for future grants.

 

Pursuant to our 2018 Omnibus Stock Incentive Plan, we reserved 2,000,000 shares of common stock. As of December 31, 2023, there were options to purchase 1,760,000 shares outstanding, options to purchase 116,667 shares were exercised, options to purchase 13,333 shares expired, and the remaining 110,000 shares were transferred to the 2020 Omnibus Stock Incentive Plan (“2020 Plan”).

 

Pursuant to our 2020 Plan, we reserved 3,110,000 shares of common stock. As of December 31, 2023, there were options to purchase 1,820,000 shares outstanding, options to purchase 50,000 shares expired and the remaining 1,240,000 shares were transferred to the 2021 Omnibus Stock Incentive Plan (“2021 Stock Plan”).

 

Pursuant to our 2021 Stock Plan, we reserved 8,740,000 shares of common stock. As of December 31, 2023, options to purchase 8,630,000 shares were outstanding, options to purchase 75,000 shares expired and the remaining 35,000 shares were transferred to the 2023 Omnibus Stock Incentive Plan (“2023 Stock Plan”).

 

In November 2022, our Board approved the 2023 Stock Plan, subject to stockholder approval, which was received on February 7, 2023. The 2023 Stock Plan has reserved for issuance 12,035,000 shares of common stock. As of December 31, 2023, options to purchase 4,385,000 shares were outstanding and 7,650,000 shares remain 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. 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, 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.

 

A summary of option activity under our stock option plans (excluding the NoveCite and Citius Oncology Stock Plans) is presented below:

 

   Option
Shares		   Weighted-
Average
Exercise
Price		   Weighted-
Average
Remaining
Contractual
Term		  Aggregate
Intrinsic
Value		 
Outstanding at September 30, 2023   13,305,171   $           1.79   7.41 years  $56,203 
Granted   4,085,000    0.70         
Exercised   
—
    
—
         
Forfeited or expired   
—
    
—
         
Outstanding at December 31, 2023   17,390,171   $1.54   7.78 years  $379,421 
                   
Exercisable at December 31, 2023   9,231,839   $1.91   6.60 years  $134,921 

 

On October 10, 2023, the Board of Directors granted options to purchase 3,725,000 shares to employees, 300,000 shares to directors and 60,000 shares to consultants at $0.70 per share. The weighted average grant date fair value of the options granted during the three months ended December 31, 2023 was estimated at $0.54 per share. These options vest over terms of 12 to 36 months and have a term of 10 years.

 

On October 4, 2022, the Board of Directors granted options to purchase 3,375,000 shares to employees, 375,000 shares to directors and 50,000 shares to a consultant at $1.25 per share. On November 8, 2022, the Board of Directors granted options to purchase 50,000 shares to a consultant at $1.04 per share. The weighted average grant date fair value of the options granted during the three months ended December 31, 2023 was estimated at $0.97 per share. These options vest over terms of 12 to 36 months and have a term of 10 years.

 

Stock-based compensation expense for the three months ended December 31, 2023 and 2022 was $3,058,185 (including $19,858 for the NoveCite plan and $1,917,000 for the Citius Oncology Plan) and $1,201,081 (including $33,333 for the NoveCite Stock Plan), respectively.

 

At December 31, 2023, unrecognized total compensation cost related to unvested awards under the Citius Pharma stock plans of $5,905,736 is expected to be recognized over a weighted average period of 1.75 years.

 

NoveCite Stock Plan - Under the NoveCite Stock Plan, we reserved 2,000,000 common shares of NoveCite for issuance. As of December 31, 2023, there were options outstanding to purchase 1,911,500 common shares of NoveCite and 88,500 shares available for future grants. All of the options were issued during the year ended September 30, 2021.

 

As of December 31, 2023, NoveCite has options outstanding to purchase 1,911,500 common shares at a weighted average exercise price of $0.24 per share, of which 1,772,917 are exercisable. These options vest over 36 months and have a term of 10 years. The weighted average remaining contractual term of options outstanding under the NoveCite Stock Plan is 7.14 years. At December 31, 2023, unrecognized total compensation cost related to unvested awards under the NoveCite Stock Plan of $27,717 is expected to be recognized over a weighted average period of 0.5 years.

 

Citius Oncology Stock Plan - Under the Citius Oncology Stock Plan, adopted on April 29, 2023, we reserved 15,000,000 common shares of Citius Oncology for issuance. The Citius Oncology Stock Plan provides incentives to employees, directors, and consultants through grants of options, SARs, dividend equivalent rights, restricted stock, restricted stock units, or other rights.

 

During the year ended September 30, 2023, Citius Oncology granted options to purchase 12,750,000 common shares at a weighted average exercise price of $2.15 per share, of which options to purchase 150,000 common shares were forfeited. The weighted average grant date fair value of the options granted during the year ended September 30, 2023 was estimated at $1.65 per share. These options vest over periods from 12 to 36 months and have a term of 10 years.

 

At December 31, 2023, Citius Oncology has options outstanding to purchase 12,600,000 shares, of which 1,638,889 common shares are exercisable. The weighted average remaining contractual term of options outstanding under the Citius Oncology Stock Plan is 9.5 years. At December 31, 2023, unrecognized total compensation cost related to unvested awards under the Citius Oncology Stock Plan of $16,925,500 is expected to be recognized over a weighted average period of 2.4 years.

 

Warrants

 

As of December 31, 2023, we have reserved shares of common stock for the exercise of outstanding warrants as follows:

 

   Exercise
price		   Number   Expiration Date
August 2018 Offering Investors  $1.15    3,921,569   August 14, 2024
August 2018 Offering Agent   1.59    189,412   August 8, 2024
April 2019 Registered Direct/Private Placement Investors   1.42    1,294,498   April 5, 2024
April 2019 Registered Direct/Private Placement Agent   1.93    240,130   April 5, 2024
September 2019 Offering Investors   0.77    2,793,297   September 27, 2024
September 2019 Offering Underwriter   1.12    194,358   September 27, 2024
February 2020 Exercise Agreement Agent   1.28    138,886   August 19, 2025
May 2020 Registered Direct Offering Investors   1.00    1,670,588   November 18, 2025
May 2020 Registered Direct Offering Agent   1.33    155,647   May 14, 2025
August 2020 Underwriter   1.31    201,967   August 10, 2025
January 2021 Private Placement Investors   1.23    3,091,192   July 27, 2026
January 2021 Private Placement Agent   1.62    351,623   July 27, 2026
February 2021 Offering Investors   1.70    20,580,283   February 19, 2026
February 2021 Offering Agent   1.88    2,506,396   February 19, 2026
May 2023 Registered Direct Offering Investors   1.50    12,500,001   May 8, 2028
May 2023 Registered Direct Offering Agent   1.50    875,000   May 3, 2028
         50,704,847    

 

At December 31, 2023, the weighted average remaining life of the outstanding warrants is 2.5 years, all warrants are exercisable, and there was no aggregate intrinsic value of the warrants outstanding.

 

Common Stock Reserved

 

A summary of common stock reserved for future issuances as of December 31, 2023 is as follows:

 

Stock plan options outstanding   17,390,171 
Stock plan shares available for future grants   7,650,000 
Warrants outstanding   50,704,847 
Total   75,745,018