Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Dec. 31, 2022 | Feb. 09, 2023 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Dec. 31, 2022 | |
Entity File Number | 001-34887 | |
Entity Registrant Name | MULLEN AUTOMOTIVE INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 86-3289406 | |
Entity Address, Address Line One | 1405 Pioneer Street | |
Entity Address, City or Town | Brea | |
Entity Address State Or Province | CA | |
Entity Address, Postal Zip Code | 92821 | |
City Area Code | 714 | |
Local Phone Number | 613-1900 | |
Title of 12(b) Security | Common Stock, par value $0.001 per share | |
Trading Symbol | MULN | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 1,747,209,236 | |
Entity Central Index Key | 0001499961 | |
Current Fiscal Year End Date | --09-30 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2022 | Sep. 30, 2022 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 68,071,635 | $ 54,085,685 |
Restricted cash | 39,357,576 | 30,289,400 |
Receivable for over issuance of shares | 17,909,254 | |
Inventory | 6,958,158 | |
Prepaid expenses and other current assets | 3,260,726 | 1,958,759 |
TOTAL CURRENT ASSETS | 135,557,349 | 86,333,844 |
Property, equipment and leasehold improvements, net | 89,796,658 | 14,803,716 |
Intangible assets, net | 113,377,931 | 93,947,018 |
Deposit on ELMS purchase | 5,500,000 | |
Accounts receivable from related party | 1,232,387 | 1,232,387 |
Right-of-use assets | 4,763,589 | 4,597,052 |
Goodwill | 92,834,832 | 92,834,832 |
Other assets | 3,389,293 | 3,345,631 |
TOTAL ASSETS | 440,952,039 | 302,594,479 |
CURRENT LIABILITIES | ||
Accounts payable | 14,123,277 | 6,398,425 |
Accrued expenses and other current liabilities | 6,225,969 | 7,185,881 |
Dividends payable | 8,400,933 | 7,762,255 |
Derivative liabilities | 261,480,084 | 84,799,179 |
Liability to issue shares | 11,599,598 | 10,710,000 |
Lease liabilities, current portion | 1,696,626 | 1,428,474 |
Notes payable, current portion | 93,837,257 | 3,856,497 |
Other current liabilities | 103,372 | 90,372 |
TOTAL CURRENT LIABILITIES | 397,467,116 | 122,231,083 |
Notes payable, net of current portion | 4,890,475 | 5,164,552 |
Lease liabilities, net of current portion | 3,381,024 | 3,359,354 |
Derivative liabilities | 14,463,705 | 14,882,782 |
TOTAL LIABILITIES | 420,202,320 | 145,637,771 |
Commitments and contingencies (Note 17) | ||
STOCKHOLDERS' EQUITY | ||
Common Stock; $0.001 par value; 1,750,000,000 shares authorized; 1,693,663,180 and 833,468,180 shares issued and outstanding at December 31, 2022 and September 30, 2022 respectively. | 1,693,663 | 833,468 |
Additional Paid-in Capital | 1,189,162,862 | 947,765,155 |
Accumulated Deficit | (1,266,183,241) | (889,907,455) |
Non-controlling interest | 96,074,860 | 98,259,819 |
TOTAL STOCKHOLDERS' EQUITY | 20,749,719 | 156,956,708 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 440,952,039 | 302,594,479 |
Series A Preferred Stock | ||
STOCKHOLDERS' EQUITY | ||
Preferred Stock, Value | 2 | 2 |
Series C Preferred Stock | ||
STOCKHOLDERS' EQUITY | ||
Preferred Stock, Value | 1,210 | 1,360 |
Series D Preferred Stock | ||
STOCKHOLDERS' EQUITY | ||
Preferred Stock, Value | 363 | 4,359 |
Series AA Preferred Stock | ||
STOCKHOLDERS' EQUITY | ||
Preferred Stock, Value |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2022 | Sep. 30, 2022 |
Preferred Stock, par value | $ 0.001 | $ 0.001 |
Preferred Stock, shares authorized | 500,000,000 | 500,000,000 |
Preferred Stock, shares issued | 1,575,079 | 5,721,897 |
Preferred Stock, shares outstanding | 1,575,079 | 5,721,897 |
Common Stock, par value | $ 0.001 | $ 0.001 |
Common Stock, shares authorized | 1,750,000,000 | 1,750,000,000 |
Common Stock, shares issued | 1,693,663,180 | 833,468,180 |
Common Stock, shares outstanding | 1,693,663,180 | 833,468,180 |
Series A Preferred Stock | ||
Preferred Stock, shares authorized | 200,000 | 200,000 |
Preferred Stock, shares issued | 1,924 | 1,924 |
Preferred Stock, shares outstanding | 1,924 | 1,924 |
Series C Preferred Stock | ||
Preferred Stock, shares authorized | 40,000,000 | 40,000,000 |
Preferred Stock, shares issued | 1,210,056 | 1,360,321 |
Preferred Stock, shares outstanding | 1,210,056 | 1,360,321 |
Series D Preferred Stock | ||
Preferred Stock, shares authorized | 437,500,001 | 437,500,001 |
Preferred Stock, shares issued | 363,098 | 4,359,652 |
Preferred Stock, shares outstanding | 363,098 | 4,359,652 |
Series AA Preferred Stock | ||
Preferred Stock, shares authorized | 1 | |
Preferred Stock, shares issued | 1 | 0 |
Preferred Stock, shares outstanding | 1 | 0 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
OPERATING EXPENSES | ||
General and administrative | $ 64,996,011 | $ 12,901,084 |
Research and development | 8,622,009 | 1,157,323 |
Total Operating Expense | 73,618,020 | 14,058,407 |
Loss from Operations | (73,618,020) | (14,058,407) |
Other financing costs - initial recognition of derivative liabilities | (255,960,025) | (108,979,229) |
Gain / (loss) extinguishment of debt, net | (6,412,170) | 74,509 |
Revaluation of derivative liabilities | (40,781,976) | (10,618,382) |
Interest expense | (2,828,089) | (3,226,769) |
Loan amortization expense | (19,212,176) | |
Deferred tax benefit | 493,654 | |
Other income (expense), net | 645,881 | (41,096) |
Net loss before accrued preferred dividends and noncontrolling interest | (378,460,745) | (156,061,550) |
Net loss attributable to noncontrolling interest | 2,184,959 | |
Net loss attributable to shareholders | (376,275,786) | (156,061,550) |
Accrued preferred dividends | (638,677) | |
Net Loss attributable to common shareholders | $ (376,914,463) | $ (156,061,550) |
Net loss per share, basic | $ (0.28) | $ (8.93) |
Net loss per share, diluted | $ (0.28) | $ (8.93) |
Weighted average shares outstanding, basic | 1,360,570,075 | 17,471,173 |
Weighted average shares outstanding, diluted | 1,360,570,075 | 17,471,173 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) | Preferred Stock Series A Preferred Stock | Preferred Stock Series B Preferred Stock | Preferred Stock Series C Preferred Stock | Preferred Stock Series D Preferred Stock | Preferred Stock Series AA Preferred Stock | Common Stock Series C Warrants | Common Stock Series D Warrants | Common Stock | Paid-in Capital Series C Warrants | Paid-in Capital Series D Warrants | Paid-in Capital | Accumulated Deficit | Non-controlling Interest | Series C Warrants | Series D Warrants | Total |
Balance, beginning at Sep. 30, 2021 | $ 100 | $ 5,568 | $ 7,048 | $ 88,650,286 | $ (150,374,649) | $ (61,711,647) | ||||||||||
Balance, beginning (in shares) at Sep. 30, 2021 | 100,363 | 5,567,319 | 7,048,387 | |||||||||||||
Common shares issued for cash | $ 7,704 | 10,886,955 | 10,894,659 | |||||||||||||
Common shares issued for cash (in shares) | 7,704,082 | |||||||||||||||
Common shares issued for asset | $ 109 | 140,891 | 141,000 | |||||||||||||
Common shares issued for asset (in shares) | 109,412 | |||||||||||||||
Preferred shares issued for cash | $ 2,264 | 19,997,736 | 20,000,000 | |||||||||||||
Preferred shares issued for cash (in shares) | 2,263,970 | |||||||||||||||
Preferred shares issued to settle liability to issue | $ 85 | 704,915 | 705,000 | |||||||||||||
Preferred shares issued to settle liability to issue (in shares) | 84,900 | |||||||||||||||
Warrants exercised for receivable and financing loss | 10,491,621 | 10,491,621 | ||||||||||||||
Preferred shares issued in exchange for conversion of debt | $ 2,829 | 24,988,926 | 24,991,755 | |||||||||||||
Preferred shares issued in exchange for conversion of debt (in shares) | 2,829,029 | |||||||||||||||
Share-based compensation issued to management, directors, employees, and consultants | $ 443 | 4,424,825 | 4,425,268 | |||||||||||||
Share-based compensation issued to management, directors, employees, and consultants (in shares) | 443,124 | |||||||||||||||
Common shares issued to settle liability to issue | $ 131 | 1,034,681 | 1,034,812 | |||||||||||||
Common shares issued to settle liability to issue (in shares) | 131,477 | |||||||||||||||
Prefunded warrant issuance | 15,000,000 | 15,000,000 | ||||||||||||||
Issuance of common stock for conversion of preferred stock | $ (85) | $ 8,500 | (8,415) | |||||||||||||
Issuance of common stock for conversion of preferred stock (in shares) | (84,996) | 8,499,680 | ||||||||||||||
Balance, ending at Dec. 31, 2021 | $ 15 | $ 5,568 | $ 5,178 | $ 23,935 | 176,312,421 | (150,374,649) | 25,972,468 | |||||||||
Balance, ending (in shares) at Dec. 31, 2021 | 15,367 | 5,567,319 | 5,177,899 | 23,936,162 | ||||||||||||
Balance, beginning at Sep. 30, 2022 | $ 2 | $ 1,360 | $ 4,360 | $ 833,467 | 947,765,156 | (889,907,455) | $ 98,259,819 | 156,956,708 | ||||||||
Balance, beginning (in shares) at Sep. 30, 2022 | 1,924 | 1,360,321 | 4,359,652 | 833,468,180 | ||||||||||||
Share-based compensation issued to management, directors, employees, and consultants | $ 113,891 | 30,153,769 | 30,267,660 | |||||||||||||
Share-based compensation issued to management, directors, employees, and consultants (in shares) | 113,890,600 | |||||||||||||||
Shares issued to extinguish penalty | $ 23,000 | 5,497,000 | 5,520,000 | |||||||||||||
Shares issued to extinguish penalty (in shares) | 23,000,000 | |||||||||||||||
Cashless Warrant exercise | $ 128,464 | $ 229,099 | $ 39,059,514 | $ 70,910,165 | $ 39,187,978 | $ 71,139,264 | ||||||||||
Cashless Warrant exercise (in shares) | 128,463,567 | 229,098,769 | 229,098,769 | |||||||||||||
Surplus common stock issued on cashless warrant exercise | $ 78,718 | 26,656,760 | 26,735,478 | |||||||||||||
Surplus common stock issued on cashless warrant exercise (in shares) | 78,718,040 | |||||||||||||||
Issuance of common stock for conversion of preferred stock | $ (150) | $ (3,997) | $ 4,147 | 0 | ||||||||||||
Issuance of common stock for conversion of preferred stock (in shares) | (150,265) | (3,996,554) | 4,146,819 | |||||||||||||
Dividends accumulated on preferred stock | (638,677) | (638,677) | ||||||||||||||
Other transactions | (3,122,227) | (3,122,227) | ||||||||||||||
Shares issued to settle note payable | $ 62,049 | 13,674,354 | 13,736,403 | |||||||||||||
Shares issued to settle note payable (in shares) | 62,048,666 | |||||||||||||||
Shares issued for convertible notes | $ 220,828 | 59,182,048 | 59,402,876 | |||||||||||||
Shares issued for convertible notes (in shares) | 220,828,539 | |||||||||||||||
Preferred shares issued to officers | $ 1 | 25,000 | 25,000 | |||||||||||||
Net loss allocable to non-controlling interest | (2,184,959) | (2,184,959) | ||||||||||||||
Net loss | (376,275,786) | (376,275,786) | ||||||||||||||
Balance, ending at Dec. 31, 2022 | $ 2 | $ 1,210 | $ 363 | $ 1,693,663 | $ 1,189,162,862 | $ (1,266,183,241) | $ 96,074,860 | $ 20,749,719 | ||||||||
Balance, ending (in shares) at Dec. 31, 2022 | 1,924 | 1,210,056 | 363,098 | 1 | 1,693,663,180 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 3 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Cash Flows from Operating Activities | ||
Net loss before accrued preferred dividends and noncontrolling interest | $ (378,460,745) | $ (156,061,550) |
Adjustments to reconcile net loss attributable to shareholders to net cash used in operating activities: | ||
Depreciation and amortization | 4,794,327 | 307,699 |
Officer and employee stock compensation | 36,305,972 | 1,604,293 |
Revaluation of derivative liabilities | 40,781,976 | 10,618,382 |
Issuance of shares for services | 4,376,438 | 2,495,487 |
Issuance of stock to directors | 71,000 | |
Gain on conversion of derivative liabilities to common stock | (9,965,728) | |
Non-cash financing loss on over-exercise of warrants | 8,934,892 | |
Other financing costs - initial recognition of derivative liabilities | 255,960,025 | 108,979,229 |
Non-cash interest and other operating activities | 3,062,048 | |
Non-cash lease expense | 136,938 | |
Amortization of debt discount | 19,212,176 | |
Loss on asset disposal | 1,298 | |
Loss/(gain) on extinguishment of debt | 6,412,171 | (74,509) |
Loss on debt settlement | 41,096 | |
Changes in operating assets and liabilities: | ||
Other current assets | (8,260,125) | (1,226,376) |
Other assets | (197,199) | (1,225,252) |
Accounts payable | 7,724,852 | (977,783) |
Accrued expenses and other liabilities | (1,576,292) | (1,468,751) |
Deferred tax liability | (419,077) | |
Lease liabilities | 289,821 | (137,228) |
Net cash used in operating activities | (33,227,692) | (14,712,803) |
Cash Flows from Investing Activities | ||
Purchase of equipment | (726,482) | (10,462,219) |
Purchase of intangible assets | (74,826) | |
ELMS asset purchase | (92,916,874) | |
Net cash used in investing activities | (93,718,182) | (10,462,219) |
Cash Flows from Financing Activities | ||
Proceeds from issuance of notes payable | 150,000,000 | 7,300,000 |
Proceeds from issuance of common stock | 10,894,659 | |
Proceeds from issuance of preferred stock | 20,000,000 | |
Payment of notes payable | (13,000,351) | |
Net cash provided by financing activities | 150,000,000 | 25,194,308 |
Increase in cash | 23,054,126 | 19,286 |
Cash, cash equivalents and restricted cash, beginning of period | 84,375,085 | 42,174 |
Cash and cash equivalents and restricted cash, ending of period | 107,429,211 | 61,460 |
Supplemental disclosure of Cash Flow information: | ||
Cash paid for interest | 3,056 | 1,424,345 |
Supplemental Disclosure for Non-Cash Activities: | ||
Debt conversion to common stock | 1,096,787 | |
Preferred shares issued in exchange for convertible debt | $ 24,991,755 | |
Convertible notes conversion to common stock | 59,402,877 | |
Exercise of warrants recognized earlier as liabilities | $ 84,799,179 |
DESCRIPTION OF BUSINESS AND BAS
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | 3 Months Ended |
Dec. 31, 2022 | |
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | |
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | NOTE 1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION Description of Business Mullen Automotive Inc., a Delaware corporation (“MAI”, “Mullen”, “we” or the “Company”), is a Southern California-based development-stage electric vehicle company that operates in various verticals of businesses focused within the automotive industry. Mullen Automotive Inc., a California corporation (“Previous Mullen”) was originally formed on April 20 2010, as a developer and manufacturer of electric vehicle technology and operated as the EV division of Mullen Technologies, Inc. (“MTI”) until November 5, 2021, at which time Previous Mullen underwent a capitalization and corporate reorganization by way of a spin-off to its shareholders, followed by a reverse merger with and into Net Element, Inc., which was accounted for as a reverse merger transaction, in which Previous Mullen was treated as the acquirer for financial accounting purposes. (the “Merger”). The Company changed its name from “Net Element, Inc.” to “Mullen Automotive Inc” and the Nasdaq ticker symbol for the Company’s Common Stock changed from “NETE” to “MULN” on the Nasdaq Capital Market Exchange at the opening of trading on November 5, 2021. Recent Events On September 7, 2022, the Company completed the Bollinger acquisition, which provides the Company with a medium duty truck classes 4-6, along with the B1 Sport Utility and B2 Pick Up Trucks. The purchase price was $148.6 million in cash and stock for 60% majority controlling interest. On October 13, 2022, the U.S. Bankruptcy Court approved the Company acquisition of assets from electric vehicle company ELMS’ (Electric Last Mile Solutions) in an all-cash purchase. In the Chapter 7 approved transaction, Mullen acquired ELMS’ manufacturing plant in Mishawaka Indiana, all inventory, and intellectual property for their Class 1 and Class 3 vehicles for a total of $105 million which includes the affirmation of approximately $10 million in vendor payables assumed and paid at closing. Basis of Presentation and Principles of Consolidation The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the "Commission"). Certain information and note disclosures normally included in the annual financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been condensed or omitted pursuant to those rules and regulations, but we believe the disclosures made are adequate to make the information presented not misleading. In the opinion of management, all adjustments, consisting of normal and recurring adjustments, necessary for a fair presentation have been included in the condensed consolidated financial statements included herein. These statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K/A filed with the Commission for the year ended September 30, 2022 . The consolidated financial statements include the accounts of the Company and its subsidiaries, Mullen Investment Properties LLC, a Mississippi corporation, Ottava Automotive, Inc., a California corporation, Mullen Real Estate, LLC, a Delaware corporation and Bollinger Motors Inc., a Delaware corporation. Intercompany accounts and transactions have been eliminated, if any. The financial statements reflect the consolidated financial position and results of operations of Mullen, which have been prepared in accordance with Generally Accepted Accounting Principles in the United States (“U.S. GAAP”). |
LIQUIDITY, CAPITAL RESOURCES, A
LIQUIDITY, CAPITAL RESOURCES, AND GOING CONCERN | 3 Months Ended |
Dec. 31, 2022 | |
LIQUIDITY, CAPITAL RESOURCES, AND GOING CONCERN | |
LIQUIDITY, CAPITAL RESOURCES, AND GOING CONCERN CONSIDERATION | NOTE 2 – LIQUIDITY, CAPITAL RESOURCES, AND GOING CONCERN CONSIDERATION The accompanying condensed consolidated financial statements have been prepared on the basis that the Company will continue as a going concern. Our principal source of liquidity consists of existing cash and restricted cash of approximately $107.4 million at December 31, 2022. During the three months ended December 31, 2022, the Company used $33.2 million of cash for operating activities and had net working capital deficit of approximately $261.9 million at December 31, 2022. Going Concern The Company’s financial statements as of December 31, 2022, have been prepared on a going concern basis. The Company has not generated revenue to date and has accumulated losses since inception. The Company’s ability to continue operating as a going concern is contingent upon, among other things, its ability to raise sufficient additional capital and/or obtaining the necessary financing to support ongoing and future operations and to successfully manufacture and launch its products for sale. While the Company expects to obtain the additional capital and/or financing that is needed, there is no assurance that the Company will be successful in obtaining the necessary funds to bring its product and service offerings to market and support future operations. These factors raise substantial doubt as to the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of these uncertainties. Our management plans to raise additional capital through a combination of equity and debt financing, strategic alliances and licensing arrangements. Company management has evaluated whether there are any conditions and events considered in aggregate, which raises substantial doubt about its ability to continue as a going concern over the next twelve months from the date of filing this report. Since inception, the Company incurred significant accumulated losses of approximately $1,266.2 million, and has a deficiency in working capital of approximately $261.9 million on December 31, 2022. For more information regarding additional financing after December 31, 2022, see Note 19 – Subsequent Events. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Dec. 31, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Significant accounting policies are defined as those that are reflective of significant judgments and uncertainties, and potentially result in materially different results under different assumptions and conditions. Business Combination Business acquisitions are accounted for in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 805 “Business Combinations”. FASB ASC 805 requires the reporting entity to identify the acquirer, determine the acquisition date, recognize and measure the identifiable tangible and intangible assets acquired, the liabilities assumed and any non-controlling interest in the acquired entity, and recognize and measure goodwill or a gain from the purchase. The acquiree’s results are included in the Company’s consolidated financial statements from the date of acquisition. Assets acquired and liabilities assumed are recorded at their fair values and the excess of the purchase price over the amounts assigned is recorded as goodwill. Adjustments to fair value assessments are recorded to goodwill over the measurement period (not longer than twelve months). The acquisition method also requires that acquisition-related transaction and post-acquisition restructuring costs be charged to expense. The Company completed the acquisition of Bollinger Motors, Inc on September 7, 2022. Use of Estimates The preparation of our financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the dates of the carve-out financial statements and the reported amounts of total expenses in the reporting periods. Estimates are used for, but not limited to, fair value of long-lived assets, fair value of financial instruments, depreciable lives of property and equipment, income taxes, contingencies, and inputs used to value stock-based compensation, valuation of common and preferred stock and warrants. Additionally, the rates of interest on several debt agreements have been imputed where there was no stated interest rate within the original agreement. The imputed interest results in adjustments to the debt amounts reported in our condensed consolidated financial statements prepared under U.S. GAAP. Loan valuations issues can arise when trying to determine the debt attributes, such as discount rate, credit loss factors, liquidity discounts, and pricing. Management bases its estimates on historical experience and on various other assumptions believed to be reasonable, the results of which form the basis for adjustments about the carrying values of assets and liabilities and the recording of costs and expenses that are not readily apparent from other sources. The actual results may differ materially from these estimates. Risks and Uncertainties The Company operates within an industry that is subject to rapid technological change, intense competition, and serves an industry that has significant government regulations. It is subject to significant risks and uncertainties, including competitive, financial, developmental, operational, technological, required knowledge of industry governmental regulations, and other risks associated with an emerging business. Any one or combination of these or other risks could have a substantial influence on our future operations and prospects for commercial success. Cash and Cash Equivalents Company management considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. There were no cash equivalents at December 31, 2022 or September 30, 2022. Restricted Cash Funds that are not available for immediate use and must use for a specific purpose. These funds include the refundable deposits for individuals and businesses who have made deposits for Mullen and Bollinger vehicles and the cash in escrow. On December 31, 2022, the restricted cash balance was $39,357,576. Customer deposits are accounted for within other liabilities. Prepaid Expenses and Other Current Assets Prepaid expenses consist of various advance payments made for goods or services to be received in the future. These prepaid expenses include insurance and other contracted services requiring up-front payments. Property, Equipment and Leasehold Improvements, Net Property, equipment, and leasehold improvements are stated at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated economic useful lives of the assets. Repairs and maintenance expenditures that do not extend the useful lives of related assets are expensed as incurred. Estimated Useful Lives Description Life Buildings 30 Years Furniture and Equipment 3 to 7 Years Computer and Software 1 to 5 Years Machinery and Equipment 3 Leasehold Improvements Shorter of the estimated useful life or the underlying lease term Vehicles 5 Years Intangibles 5 Expenditures for major improvements are capitalized, while minor replacements, maintenance and repairs, which do not extend the asset lives, are charged to operations as incurred. Upon sale or disposition, the cost and related accumulated depreciation are removed from the accounts and any gain or loss is included in operations. Company management continually monitors events and changes in circumstances that could indicate that the carrying balances of its property, equipment and leasehold improvements may not be recoverable in accordance with the provisions of ASC 360, “Property, Plant, and Equipment.” Income Taxes Prior to Mullen’s capitalization and corporate reorganization, our operations were included in the tax filings of MTI. The cash and deferred tax positions between us and MTI and are formalized in a tax sharing agreement. Income taxes are recorded in accordance with ASC 740 , Income Taxes There are transactions that occur during the ordinary course of business for which the ultimate tax determination may be uncertain. At December 31, 2022 and September 30, 2022, there were no material changes to either the nature or the amounts of the uncertain tax positions. The Company’s income tax provision consists of an estimate for U.S. federal and state income taxes based on enacted rates, as adjusted for allowable credits, deductions, uncertain tax positions, changes in deferred tax assets and liabilities, and changes in the tax law. We maintain a full valuation allowance against the value of our U.S. and state net deferred tax assets because management does not believe the recoverability of the tax assets meets the “more likely than not” likelihood at December 31, 2022 and September 30, 2022. Intangible Assets Intangible assets consist of acquired and developed intellectual property and website development costs. In accordance with ASC 350, “Intangibles—Goodwill and Others,” Impairment of Long-Lived Assets The Company periodically evaluates property, plant and equipment and intangible assets for impairment whenever events or changes in circumstances indicate that a potential impairment may have occurred. If such events or changes in circumstances arise, the Company compares the carrying amount of the long-lived assets to the estimated future undiscounted cash flows expected to be generated by the long-lived assets. If the estimated aggregate undiscounted cash flows are less than the carrying amount of the long-lived assets, an impairment charge, calculated as the amount by which the carrying amount of the assets exceeds the fair value of the assets, is recorded. The fair value of the long-lived assets is determined based on the estimated discounted cash flows expected to be generated from the long-lived assets. The Company has not recorded any such impairment charges during the three months ended December 31, 2022 and 2021, respectively. Other Assets Other assets are comprised primarily of Coda electric vehicles and related parts, Show Room vehicles, and security deposits related to the Company’s property leases related to the EV business. Extinguishment of Liabilities The Company derecognizes financial liabilities when the Company’s obligations are discharged, cancelled, or expired. Leases The Company follows the provisions of Accounting Standards Update, “Leases” (ASU 2016 02), which requires a lessee to recognize a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying leased asset for the lease term. Accrued Expenses Accrued expenses are expenses that have been incurred but not yet paid and are classified within current liabilities on the consolidated balance sheets. General and Administrative Expenses General and administrative (“G&A”) expenses include all non-production related expenses incurred by us in any given period. This includes expenses such as professional fees, salaries, rent, repairs and maintenance, utilities and office expense, employee benefits, depreciation and amortization, advertising and marketing, settlements and penalties, taxes, and licenses. Advertising costs are expensed as incurred and are included in G&A expenses. Other than trade show expenses which are deferred until occurrence of the future event, we expense advertising costs as incurred in accordance with ASC 720-35, “Other Expenses – Advertising Cost.” Research and Development Costs Research and development costs are expensed as incurred. Research and development expenses consist primarily of costs associated with the development of our electric vehicle product lines. Share-Based Compensation We account for share-based awards issued by the Company in accordance with ASC Subtopic 718-10, “Compensation – Share Compensation”, which requires fair value measurement on the grant date and recognition of compensation expense for all common shares of the Company issued to employees, non-employees and directors. The fair value of non-marketable share-based awards has been estimated based on an independent valuation. The Company’s common and preferred share valuations have been appraised by an independent financial valuation advisor, based on assumptions management believes to be reasonable. Key assumptions and approaches to value used in estimating fair value, includes economic and industry data; business valuation; prior transactions; option value method and other cost, income, and market value approaches. Share-based compensation is included within general and administrative expenses. Related Party Transactions We have related party transactions with certain of our directors, officers, and principal stockholders. These transactions are entered into in the ordinary course of business and include operational loans, convertible debt, and warrants providing financial support associated with the borrowing of funds. Fair Value of Financial Instruments We apply fair value accounting for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value on a recurring basis. Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities that are required to be recorded at fair value, Company management considers the principal or most advantageous market in which we would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as risks inherent in valuation techniques, transfer restrictions and credit risk. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: Level 1 – Quoted prices in active markets for identical assets or liabilities. Level 2 – Level 3 – Concentrations of Business and Credit Risk We maintain cash balances in several financial institutions that are insured by either the Federal Deposit Insurance Corporation or the National Credit Union Association up to certain federal limitations, generally $250,000. At times, our cash balance may exceed these federal limitations and maintains significant cash on hand at certain of its locations. However, we have not experienced any losses in such accounts and management believes we are not exposed to any significant credit risk on these accounts. The amounts in excess of insured limits as of December 31, 2022 and September 30, 2022 are $67.3 million and $53.3 million, respectively. Recently Issued Accounting Standards Accounting standard updates issued but not yet added were assessed and determined to be either not applicable or not expected to have a material impact on our consolidated financial statements. |
PURCHASE OF ASSETS FROM ELMS
PURCHASE OF ASSETS FROM ELMS | 3 Months Ended |
Dec. 31, 2022 | |
PURCHASE OF ASSETS FROM ELMS | |
PURCHASE OF ASSETS FROM ELMS | NOTE 4 – PURCHASE OF ASSETS FROM ELMS On October 13, 2022, the United States Bankruptcy Court for the District of Delaware issued an order approving the sale for approximately $105 million to Mullen Automotive Inc. of certain assets and assumption and assignment of contracts and related liabilities of Electric Last Mile, Inc. and Electric Last Mile Solutions, Inc. pursuant to the terms and conditions of the Asset Purchase Agreement dated September 16, 2022. The ELMS asset acquisition closed on November 30, 2022, and is expected to accelerate the market introduction of our cargo van program and provide us with critical manufacturing capacity at a much lower investment than previously expected to supply the rest of our product portfolio. ELMS assets include: ● The factory in Mishawaka, Indiana, providing Mullen with the capability to produce up to 50,000 vehicles per year; ● All Intellectual Property, including all manufacturing data that is required for the assembly of the Class 1 van and Class 3 Cab Chassis; ● All inventory including finished and unfinished vehicles, part modules, component parts, raw materials, and tooling; and ● All property including equipment, machinery, supplies, computer hardware, software, communication equipment, data networks and all other data storage. The following details the allocation of purchase price by asset category for the ELMS asset purchase: Asset Category Fair Value Allocation Land $ 1,440,000 Buildings and site improvements 41,287,038 Personal property subtotal 33,577,045 Identified intangible: engineering design 22,112,791 Inventory 6,958,158 Total Identified Assets $ 105,375,032 |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 3 Months Ended |
Dec. 31, 2022 | |
INTANGIBLE ASSETS | |
INTANGIBLE ASSETS | NOTE 5 – INTANGIBLE ASSETS For the three months ended December 31, 2022, and 2021, we recorded intangible asset additions of $22,187,617 and $5,361, respectively. The $22.2 million is mainly due to the ELMS asset acquisition (see NOTE 4 – Purchase of Assets from ELMS). The weighted average useful life of the intellectual property is 9.6 years. Acquired intellectual property from the Bollinger acquisition, consisted primarily of patents and non-compete agreements have finite life. Identifiable intangible assets with definite lives are amortized over the period of estimated benefit using the straight-line method and the estimated useful lives of three years. The straight-line method of amortization represents management’s best estimate of the distribution of the economic value of the identifiable intangible assets. December 31, 2022 September 30, 2022 Gross Net Gross Net Carrying Accumulated Carrying Carrying Accumulated Carrying Finite-Lived Intangible Assets Amount Amortization Amount Amount Amortization Amount Website design and development $ 2,660,391 (1,330,195) $ 1,330,195 $ 2,660,391 $ (1,108,496) $ 1,551,895 Intellectual property 58,375,794 (1,908,177) 56,467,618 58,375,794 (438,581) 57,937,213 Patents 32,391,186 (1,020,544) 31,370,642 32,391,186 (204,109) 32,187,077 Engineer design - ELMS 22,112,791 (184,273) 21,928,518 — — — Other 1,820,994 (80,876) 1,740,118 1,820,994 (16,175) 1,804,819 Trademark 540,840 — 540,840 466,014 — 466,014 Total Intangible Assets $ 117,901,996 $ (4,524,065) $ 113,377,931 $ 95,714,379 $ (1,767,361) $ 93,947,018 Total future amortization expense for finite-lived intellectual property is as follows: Years Ended December 31, Future Amortization 2023 (nine months) $ 9,299,099 2024 12,202,651 2025 11,537,553 2026 11,537,553 2027 11,537,553 Thereafter 56,722,682 Total Future Amortization Expense $ 112,837,091 For the three months ended December 31, 2022, and 2021, amortization expense for the intangible assets was $2,756,704 and $223,676, respectively. |
DEBT
DEBT | 3 Months Ended |
Dec. 31, 2022 | |
DEBT | |
DEBT | NOTE 6 – DEBT Short and Long-Term Debt Short-term debt is generally defined as debt with principal maturities of one-year or less. Long-term debt is defined as principal maturities of one year or more. The following is a summary of our indebtedness at December 31, 2022: Net Carrying Value Unpaid Principal Contractual Contractual Type of Debt Balance Current Long-Term Interest Rate Maturity Matured notes $ 3,051,085 $ 3,051,085 $ - 0 - 10% 2019 - 2021 Promissory notes - - - NA NA Convertible notes 90,597,123 90,597,123 - 15.00% 2023 Real Estate notes 5,238,259 238,259 5,000,000 5.00 - 8.99% 2023-2024 Loans and advances 557,800 557,800 - 0.00% 2016 - 2018 Less: debt discount (716,535) (607,010) (109,525) NA NA Total Debt $ 98,727,732 $ 93,837,257 $ 4,890,475 The following is a summary of our indebtedness at September 30, 2022: Net Carrying Value Unpaid Principal Contractual Contractual Type of Debt Balance Current Long-Term Interest Rate Maturity Matured notes $ 3,051,085 $ 3,051,085 $ — 0.00 - 10.00% 2019 - 2021 Promissory notes 1,096,787 — 1,096,787 28.00% 2024 Real Estate note 5,247,612 247,612 5,000,000 5.0 - 8.99% 2023 - 2024 Loan advances 557,800 557,800 — 0.00 - 10.00% 2016 – 2018 Less: debt discount (932,235) — (932,235) NA NA Total Debt $ 9,021,049 $ 3,856,497 $ 5,164,552 Scheduled Debt Maturities The following scheduled debt maturities at December 31, 2022: Years Ended September 30, 2023 (9 months) 2024 Total Total Debt $ 93,837,257 $ 4,890,475 $ 98,727,732 Notes and Advances Total interest is comprised primarily of stated interest, amortization of debt discount and additional interest recognized for warrants issued with convertible notes for the excess in fair value above the face value of the notes. Stated interest was $2,134,517 and $3,247,185 for the three months ended December 31, 2022 and 2021, respectively. In some instances, we issued shares of common stock or warrants along with the issuance of promissory notes, resulting in the recognition of a debt discount which is amortized to interest expense over the term of the promissory note. Debt discount amortization for the three months ended December 31, 2022 and 2021, was $150,151,130 and $19,212,176, respectively. During the three months ended December 31, 2022, warrants having a fair value of $244,510,164 (issuable upon conversion of the convertible notes) were recognized as a derivative liability, which exceeded the face value of the underlying debt, resulting in additional interest expense of $94,510,164. The Company issued shares of common stock to certain creditors for the conversion of convertible notes, satisfaction of debt payments, and in settlement of indebtedness. For the three months ended December 31, 2022, the carrying amount of indebtedness that was settled via issuance of shares our common stock was $95,750,938. The carrying amount of indebtedness that was settled via issuance of common stock for the three months ended December 31, 2021 was $23,192,500. NuBridge Commercial Lending LLC Promissory Note On March 7, 2022, the Company’s wholly owned subsidiary, Mullen Investment Properties, LLC entered into a Promissory Note (the “Promissory Note”) with NuBridge Commercial Lending LLC for a principal amount of $5,000,000. The Promissory Note bears interest at a fixed rate of 8.99% per annum and the principal amount is due March 1, 2024. Collateral for the loan includes the title to the Company’s property at 1 Greentech Drive, Tunica, MS. Under the Promissory Note, prepaid interest and issuance costs of $1,157,209 were withheld from the principal and recorded as debt discount, which is being amortized over the term of the note. As of December 31, 2022, the remaining unamortized debt discount was $716,535. Drawbridge and Amended A&R Note with Esousa On June 17, 2022, the Company entered into an Amended and Restated Secured Convertible Note and Security Agreement (the “A&R Note”) with Esousa Holdings LLC, a New York limited liability company (“Esousa”). The A&R Note amended and restated a promissory note dated July 23, 2020, issued by Mullen Technologies, Inc. (“Original Borrower”) to DBI Lease Buyback Servicing LLC, a Delaware limited liability company (“DBI”) for a principal amount of $23,831,554 (the “Original Note”). The Company had previously assumed all of the obligations of the Original Borrower under the Original Note upon the completion of the Merger. Esousa purchased rights under the Original Note from DBI immediately prior to entering into the A&R Note. The A&R Note extended the maturity date of the Original Note by two years, from July 23, 2022 to July 23, 2024. The A&R Note provided Esousa the right to convert all or any portion of the then-outstanding principal balance of the A&R Note into a calculated number of shares of the Common Stock of the Company. The transaction was accounted for as an extinguishment of debt with Drawbridge and the related expense within the “Incentive fee to creditor for transfer of note payable” line item of the Statement of Operations. In connection with entering into the A&R Note with Esousa, the Company agreed to provide Drawbridge with a right to purchase up to $25,000,000 worth of shares of a yet to be created Series E Preferred Stock from the Company (the “Series E Purchase Option”). Refer to Note 17 – Contingencies and Claims, for details on the Series E Purchase Option. On June 27, 2022, the Company received notification from Esousa that it was exercising the A&R Note’s conversion feature to partially convert the A&R Note and accrued interest in exchange for 28,000,000 shares of common stock. The conversion price was $0.9918 per share. Due to the limited number of authorized shares available, only 17,500,000 shares of common stock were issued, resulting in a remaining principal balance of the A&R Note of $1,096,787. The remaining 10,500,000 shares owed to Esousa were recognized as a “Liability to issue shares” on the Balance Sheet. The Company agreed to pay a $3,495,000 penalty to Esousa, settleable in cash or shares of common stock, by August 31, 2022. This fee was recognized as penalty for insufficient authorized shares within the Statement of Operations and within Accrued Expenses on the Balance Sheet. On October 14, 2022, the A&R Note with Esousa, including principal of $1,032,217 (net of debt discount of $64,570) and accrued interest of $316,127 along with the liability to issue 10,500,000 shares of common stock (having a then carrying value of $10,710,000) and an obligation to compensate for the losses from market value decline of shares were exchanged for a new convertible note payable with a face value of $12,945,914 and 23,000,000 shares of common stock (having a fair value of $5,524,600), resulting in a loss on extinguishment of $6,412,170. The new note is convertible at a 5% discount to the lowest daily volume-weighted average price in the 10 trading days prior to conversion, which resulted in interest expense of $681,364 and debt premium of $681,364. On November 1, 2022, the convertible note payable to Esousa, having a face value of $12,945,914 (plus debt premium of $681,364 ) and accrued interest of $171,174 was converted into 62,048,066 shares of common stock. No gain or loss was recognized upon the conversion. Convertible Notes On November 14, 2022, the Company entered into Amendment No. 3 to the June 7, 2022 Securities Purchase Agreement (“Amendment No. 3”). The investors paid $150 million and in lieu of receiving shares of Series D Preferred Stock and Warrants, the investors received notes convertible into shares of the Company’s common stock (“Notes”) and Warrants. Amendment No. 3 further provides that the remaining $90 million of the Commitment Amount will be paid in two tranches, on January 24, 2023, and February 24, 2023, (each, a “Purchase Date”). The purchase price per share of Series D Preferred Stock will be the lower of (i) $1.27, the closing price of the Company’s stock on the date the Securities Purchase Agreement was executed, or (ii) the closing price of the Common Stock on the trading day immediately preceding the respective Purchase Date, subject to a floor price of $0.10 per share. For no additional consideration, for every share of Series D Preferred Stock purchased, such investor will receive Warrants to purchase common shares equal to 185% of the number of shares of Series D Preferred Stock purchased by the investors at an exercise price equal to the purchase price for shares of Series D Preferred Stock. The Warrants will also permit cashless exercise to be calculated as a function of the warrant’s Black-Scholes value. Consummation of the transaction is dependent on certain conditions precedent. The investors have the right to delay each Purchase Date by one day for every day that the Company is unable to register the shares of Common Stock issuable upon conversion of the Series D Preferred Stock issued pursuant to the Securities Purchase Agreement. On November 15, 2022, the Company issued unsecured convertible notes aggregating $150,000,000 in lieu of Preferred Stock. The unsecured convertible notes bear interest at 15% and are convertible into shares of common stock either: (A) at the option of the noteholder at the lower of: (i) $0.303; or (ii) the closing price of our common stock on January 3, 2023; or (B) mandatorily on November 21, 2022 at the lower of: (i) $0.303; or (ii) the closing price of our common stock on November 18, 2022, provided adequate unissued authorized shares were available. For each share issued upon conversion, the holders are entitled to 1.85 times as many five-year As a result, and since the Company had an insufficient number of authorized shares available to settle potential future warrant exercises, the Company recognized a derivative liability of $244,510,164 for the warrants with a corresponding increase in debt discount of $150,000,000 and interest expense of $94,510,164. The debt discount was amortized over the term of the note through the date the convertible notes were mandatorily convertible. Accordingly, the entire $150,000,000 of debt discount was expensed to interest expense during the three month period ended December 31, 2022. On November 21, 2022, principal of $59,402,877 was mandatorily converted into 220,828,539 shares of common stock, resulting in a corresponding reduction in derivatives liabilities of $10,491,265 and a gain on conversion of $9,965,728. On December 23, 2022, the Company defaulted on the notes by not having sufficient authorized shares to allow for both the notes to be fully converted and the warrants to be exercised (See Note 19 – Subsequent Events). As of December 31, 2022 and September 30, 2022, accrued interest on outstanding notes payable was $3,019,085 and $1,374,925, respectively. |
DERIVATIVE LIABILITIES AND FAIR
DERIVATIVE LIABILITIES AND FAIR VALUE MEASUREMENTS | 3 Months Ended |
Dec. 31, 2022 | |
DERIVATIVE LIABILITIES AND FAIR VALUE MEASUREMENTS | |
DERIVATIVE LIABILITIES AND FAIR VALUE MEASUREMENTS | NOTE 7 – DERIVATIVE LIABILITIES AND FAIR VALUE MEASUREMENTS Upon the issuance of certain convertible debentures, warrants, and preferred stock, the Company determined that the features associated with the conversion option embedded in the debentures should be accounted for as a derivative liability and measured at fair value, as a derivative liability, as the Company has insufficient number of authorized shares available to settle all potential future conversion transactions. During the three months ended December 31, 2022, upon issuance of the instruments underlying the derivative liabilities and upon revaluation (immediately prior to conversion of the underlying instrument), the Company estimated the fair value of the embedded derivatives using the Black-Scholes Pricing Model based on the following assumptions: (1) dividend yield of 0% , (2) expected volatility of 135% to 151% , (3) risk-free interest rate of 3.77% to 3.97% , and (4) expected life of 0.02 to 10 years. On December 31, 2022, the Company estimated the fair value of the embedded derivatives of $261,480,084 using the Black-Scholes Pricing Model based on the following assumptions: (1) dividend yield of 0%, (2) expected volatility of 135% - 151%, (3) risk-free interest rate of 3.88% to 4.12%, and (4) expected life of 0.08 to 10 years. The Company adopted the provisions of ASC 825-10. ASC 825-10 defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact and considers assumptions that market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of non-performance. ASC 825-10 establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 825-10 establishes three levels of inputs that may be used to measure fair value: ● Level 1 – Quoted prices in active markets for identical assets or liabilities. ● Level 2 – Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which all significant inputs are observable or can be derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities. ● Level 3 – Unobservable inputs to the valuation methodology that are significant to the measurement of fair value of assets or liabilities. All items required to be recorded or measured on a recurring basis are based upon Level 3 inputs. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement is disclosed and is determined based on the lowest level input that is significant to the fair value measurement. Non-Financial Assets Measured at Fair Value on a Non-Recurring Basis Non-financial assets, such as property, equipment and leasehold improvements are only required to be measured at fair value when acquired or when an impairment loss is recognized. See “ ” . Financial Liabilities Measured at Fair Value on a Recurring Basis As of November 15, 2022, the Company had an insufficient number of authorized shares of common stock available for issuance upon conversion of convertible preferred shares and convertible notes payable and the exercise of outstanding warrants. These financial instruments meet the definition of a derivative until stockholders approve an increase in the authorized shares of common stock. The financial instruments convertible into shares of common stock are valued using the Black Scholes option valuation model. Items recorded or measured at fair value on a recurring basis in the accompanying consolidated financial statements consisted of the following items as of December 31, 2022: December 31, Quoted Prices Significant Significant 2022 in Active Other Unobservable Markets for Observable Inputs Identical Assets Inputs (Level 3) (Level 1) (Level 2) Derivative liability $ 261,480,084 $ - $ - $ 261,480,084 A summary of the changes in derivative liability is as follows: Balance, September 30, 2022 $ - Transfers in due to issuance of warrants w/o having adequate authorized unissued shares available 244,510,164 Derivative liability authorized shares shortfall (P&L) 26,932,880 Transfers in due to reclassification of equity instruments to derivative liabilities resulting from lack of authorized common shares 528,305 Transfers out due to conversions of convertible notes and accrued interest into common shares (10,491,265) Balance, December 31, 2022 $ 261,480,084 Financial instruments Certain financial instruments that are not carried at fair value on the condensed consolidated balance sheets are carried at amounts that approximate fair value, due to their short-term nature and credit risk. These instruments include cash and cash equivalents, accounts payable, accrued liabilities, and debt. We believe that the carrying value of term debt approximates fair value due to the variable rates associated with these obligations. Accounts payable are short-term in nature and generally terms are due upon receipt or within 30 to 90 days. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 3 Months Ended |
Dec. 31, 2022 | |
STOCKHOLDERS' EQUITY | |
STOCKHOLDERS' EQUITY | NOTE 8 – STOCKHOLDERS’ EQUITY Preferred Stock On November 5, 2021, we filed an Amended and Restated Certificate of Incorporation, which included the rights and privileges of Series A, Series B and Series C Preferred Stock. Under the terms of our Certificate of Incorporation, the Board of Directors may determine the rights, preferences, and terms of our authorized but unissued shares of preferred stock. On December 31, 2022, the Company had 500,000,000 shares of Preferred Stock authorized with $0.001 par value per share. There were 1,575,079 and 5,721,897 shares of Preferred Stock issued outstanding Certificate of Designation of Series AA Preferred Stock On November 14, 2022, the Company filed a certificate of designation (the “Series AA Certificate of Designation”) with the Secretary of State of the State of Delaware, effective as of the time of filing, designating the rights, preferences, privileges and restrictions of the share of Series AA Preferred Stock. The Series AA Certificate of Designation provides that the Series AA Preferred Stock will have 1,300,000,000 votes per share of Series AA Preferred Stock and will vote together with the outstanding shares of the Company’s common stock, Series A Preferred Stock, Series B Preferred Stock, Series C Preferred Stock and Series D Preferred Stock as a single class exclusively with respect to any proposal to adopt an amendment to the Company’s Second Amended and Restated Certificate of Incorporation to effect a reverse stock split of the Company’s common stock. The Series AA Preferred Stock will be voted, without action by the holder, on any such proposal in the same proportion as shares of common stock, Series A Preferred Stock, Series B Preferred Stock, Series C Preferred Stock and Series D Preferred Stock as a single class are voted. The Preferred Stock otherwise has no voting rights except as otherwise required by the General Corporation Law of the State of Delaware. The Series AA Preferred Stock is not convertible into, or exchangeable for, shares of any other class or series of stock or other securities of the Company. The Series AA Preferred Stock has no rights with respect to any distribution of assets of the Company, including upon a liquidation, bankruptcy, reorganization, merger, acquisition, sale, dissolution or winding up of the Company, whether voluntarily or involuntarily. The holder of the Series AA Preferred Stock will not be entitled to receive dividends of any kind. On November 14, 2022, the Company entered into a Subscription and Investment Representation Agreement with David Michery, its Chief Executive Officer, pursuant to which the Company issued and sold one share of the Company’s Series AA Preferred Stock for $25,000 in cash. In January 2023, the outstanding share of Series AA Preferred Stock was redeemed for $25,000, with the approval by the Company’s stockholders of an amendment to the Certificate of Incorporation to implement a reverse stock split. Series D Preferred Stock Certificate of Designation On September 19, 2022, the Company filed a certificate with the Secretary of State of the State of Delaware a Certificate of Designation for Series D Convertible Preferred Stock. On October 17, 2022, the Company filed a certificate with the Secretary of State of the State of Delaware to increase the Number of Shares of Preferred Stock Designated as Series D Convertible Preferred Stock (the “Certificate”). The Certificate increased the number of authorized shares of Series D Convertible Preferred Stock from 87,500,001 shares to 437,500,001 shares. Registration Statement Form S-3 On October 14, 2022, the Company filed a Registration Statement on Form S-3, which became effective upon filing with the SEC. The Registration Statement registered the resale by certain stockholders of up to 900,000,000 shares of common stock, which consist solely of 23,000,000 shares of common stock, 350,000,000 shares of common stock issuable upon conversion of Series D Preferred Stock and 527,000,000 shares of common stock issuable upon exercise of outstanding warrants to purchase shares of common stock. On November 21, 2022, the Company filed Registration Statement on Form S-3, which became effective upon filing with the SEC. The Company registered the resale by certain stockholders of 220,828,539 shares of common stock issuable upon conversion of convertible notes issued to the selling stockholders on November 15, 2022, pursuant to Amendment No. 3. The investors paid $150 million and in lieu of receiving shares of Series D Preferred Stock and warrants, the investors received the Notes, which outstanding principal and accrued but unpaid interest on the Notes convert into shares of common stock and warrants to purchase additional shares of common stock. Redemption Rights The shares of preferred stock are not subject to Mandatory Redemption. The Series C Preferred Stock are redeemable by the Company in accordance with the following schedule provided the issuance of shares of common stock underlying the shares has been registered and the registration statement remains effective: Year 1: No Redemption Year 2: Redemption at 120% of the Series C Redemption Price Year 3: Redemption at 115% of the Series C Redemption Price Year 4: Redemption at 110% of the Series C Redemption Price Year 5: Redemption at 105% of the Series C Redemption Price Year 6 and thereafter: Redemption at 100% of the Series C Redemption Price The Series D Preferred Stock may be redeemed by the Company subject to the following conditions: (i) the shares have been issued and outstanding for at least one year, (ii) the issuance of the shares of common stock underlying the shares has been registered pursuant to the Securities Act and the registration statement is effective, and (iii) the trading price for the common stock is less than the Series D Conversion Price (as such term is defined in the Certificate of Designation) for 20 trading days in any period of 30 consecutive trading days on the Nasdaq CM. In addition to the above, the shares will also be redeemable in accordance with the following schedule provided the issuance of shares of common stock underlying the shares has been registered and the registration statement remains effective: Year 1: No Redemption Year 2: Redemption at 120% of the Series D Redemption Price Year 3: Redemption at 115% of the Series D Redemption Price Year 4: Redemption at 110% of the Series D Redemption Price Year 5: Redemption at 105% of the Series D Redemption Price Year 6 and thereafter: Redemption at 100% of the Series C Redemption Price Dividends The holders of Series A and Series B Preferred Stock are entitled to non-cumulative dividends if declared by the Board of Directors. The holders of the Preferred Stock Series A and Series B Preferred Stock participate on a pro rata basis (on an “as converted” basis to common stock) in any cash dividend paid on common stock. No dividends have been declared or paid during the three months ended December 31, 2022, and 2021 The Series C Preferred Stock bears a cumulative 15.0% per annum fixed dividend payable no later than the 5 th The Company may elect to pay dividends for any month with a paid-in-kind election (“ PIK The Series D Preferred Stock bears a 15.0% per annum fixed dividend accumulated and compounded monthly, payable no later than the 5 th The Company may elect to pay dividends for any month with a PIK election if (i) the shares issuable further to the PIK are subject to an effective registration statement, (ii) the Company is then in compliance with all listing requirements of NASDAQ and (iii) the average daily trading dollar volume of the Company’s Common Stock for 10 trading days in any period of 20 consecutive trading days on the NASDAQ is equal to or greater than $27.5 million. Liquidation, Dissolution, and Winding Up. As a result of the Merger and based on the reverse ratio of one share of the Company for 12.8485 shares of Previous Mullen (the “Reverse Ratio”), on March 8, 2022, the Company filed an amendment to its Certificate of Incorporation to effectuate the following: (i) the liquidation preference for the Series A Preferred Stock was adjusted to $1.29 per share from $0.10 per share as set forth in Section 2(c) of Article III(B) of the Certificate, and (ii) the “Series B Original Issue Price” of the Series B Preferred Stock and the “Series C Original Issue Price” of the Series C Preferred Stock was adjusted to $8.84 per share from $0.6877 per share as set forth in Section 2(a) and Section 2(b), respectively, of Article III(B) of the Certificate. Upon the completion of a distribution pursuant to a Liquidation Event to the Series B Preferred Stock and Series C Preferred Stock, the holders of Series A Preferred Stock are entitled to receive, prior and in preference to any distribution of any proceeds to the holders of the Common Stock, by reason of their ownership thereof, $1.29 per share or each share of the Series A Preferred Stock (as adjusted for any stock splits, stock dividends, combinations, recapitalizations or the like with respect to the Series A Preferred Stock), plus declared but unpaid dividends on such share. “Liquidation Event” is as defined in the Certificate of Incorporation and, subject to certain exceptions, includes a sale or other disposition of all or substantially all of the company’s assets, certain mergers, consolidations and transfers of securities, and any liquidation, dissolution or winding up of the Company. In the event of any Liquidation Event, the holders of the Series B Preferred Stock will be entitled to receive, prior and in preference to any distribution of the proceeds to the holders of the other series of Preferred Stock or the Common Stock by reason of their ownership thereof, an amount per share equal to the Series B Original Issue Price plus declared but unpaid dividends. Upon the completion of a distribution pursuant to a Liquidation Event prior to the Series B Preferred Stock, the holders of the Series C Preferred Stock will be entitled to receive, prior and in preference to any distribution of the proceeds to the holders of the Series A Preferred Stock or the Common Stock by reason of their ownership thereof, an amount per share equal to the Series C Original Issue Price plus declared but unpaid dividends. In the event of any Liquidation Event, the holders of the Series D Preferred Stock will be entitled to receive, prior and in preference to any distribution of the proceeds to the holders of the other series of Preferred Stock or the Common Stock by reason of their ownership thereof, an amount per share equal to the Series D Original Issue Price plus declared but unpaid dividends. Conversion Each share of Series A Preferred Stock is convertible at any time at the option of the holder into 100 shares of fully paid and non-accessible shares of common stock. Each share of Series B Preferred Stock and each share of Series C Preferred Stock are convertible at the option of the holder at any time into such number of fully paid and nonassessable shares of common stock as is determined by dividing the Series B Original Issue Price of $8.84 or Series C Original Issue Price of $8.84 (plus all unpaid accrued and accumulated dividends thereon, as applicable, whether or not declared), by the Series B Conversion Price or Series C Conversion Price, as applicable (in each case, subject to adjustment). As of December 31, 2022, each share of Series B Preferred Stock and each share of Series C Preferred Stock are convertible into one share of common stock. Each share of Series B Preferred Stock will automatically be converted into shares of common stock at the applicable conversion rate at the time in effect immediately upon the earlier of (i) the Company’s sale of its common stock in a firm commitment underwritten public offering pursuant to a registration statement on Form S-1 or Form S-3 under the Securities Act of 1933, as amended, the public offering price of which was not less than $100,000,000 in the aggregate (a “Qualified Public Offering”) or (ii) the date specified by written consent or agreement of the holders of the then outstanding shares of Series B Preferred Stock. Each share of Series C Preferred Stock will automatically be converted into shares of common stock at the applicable conversion rate at the time in effect immediately upon (A) the issuance of shares of common stock underlying the Series C Preferred Stock being registered pursuant to the Securities Act of 1933 and such registration remaining effective, (B) the trading price for the Company’s common stock being more than two times the Series C Conversion Price for 20 trading days in any period of 30 consecutive trading days on the Nasdaq Capital Market, and (C) the average daily trading dollar volume of the Company’s common stock during such 20 trading days is equal to or greater than $4.0 million. The Series D Preferred Stock is convertible at the option of each holder at any time into the number of shares of common stock determined by dividing the Series D Original Issue Price (plus all unpaid accrued and accumulated dividends thereon, as applicable, whether or not declared), by the Series D Conversion Price, subject to adjustment as set in the Certificate of Designation. The "Series D Original Issue Price" for each share of the Series D Preferred Stock means the lower of (i) $1.27 or (ii) the closing price on the Trading Day immediately preceding the Purchase Notice Date. Each share of Series D Preferred Stock will automatically be converted into shares of common stock at the applicable Conversion Rate at the time in effect immediately upon (A) the issuance of shares of Common Stock underlying the Series D Preferred Stock being registered pursuant to the Securities Act and such registration remaining effective, (B) the trading price for the Company’s common stock being more than two times the Series D Conversion Price for 20 trading days in any period of 30 consecutive trading days on the Nasdaq Capital Market, and (C) the average daily trading dollar volume of the Company’s Common Stock during such 20 trading days is equal to or greater than $27,500,000. Voting Rights The holders of shares of Common Stock and Series A, Series B and Series C Preferred Stock at all times vote together as a single class on all matters (including the election of directors) submitted to a vote of the stockholders; provided, however Common Stock At December 31, 2022, the Company had 1,750,000,000 shares of common stock authorized with $0.001 par value per share. There were 1,693,663,180 and 833,468,180 shares of common stock issued outstanding The holders of Common Stock are entitled to one vote for each share of Common Stock held at all meetings of stockholders. In the event of a liquidation, dissolution or winding up of the Company, whether voluntary or involuntary, the common stockholders are entitled to receive the remaining assets following distribution of liquidation preferences, if any, to the holders of our preferred stock. The holders of common stock are not entitled to receive dividends unless declared by our Board of Directors. To date, no dividends were declared or paid to the holders of common stock. In the event of a liquidation, dissolution or winding up of the Company, whether voluntary or involuntary, the common stockholders are entitled to receive the remaining assets following distribution of liquidation preferences, if any, to the holders of our preferred stock. The holders of common stock are not entitled to receive dividends unless declared by our Board of Directors. To date, no dividends were declared or paid to the holders of common stock. See Note 19 – Subsequent Events. Warrants Prior to the Company’s Merger, the Company had outstanding warrants at an initial exercise price of $0.6877 per share, which were immediately exercisable and have a five-year term. Upon the completion of the Merger, these warrants were converted into detachable warrants with the Series C preferred stock as issued (the “Series C Warrants”). The exercise price was adjusted as provided in the Series C Warrants and further in accordance with the Merger Agreement such that the exercise price was $8.84 per share. During the quarter ended December 31, 2022, 2,973,276 Series C Warrants were exercised on a cash-less basis for 128,463,567 shares of common stock. There are no warrants remaining associated with the Series C at December 31, 2022. In September 2022, the Company issued 147,864,810 detachable warrants in conjunction with the issuance of 79,926,925 shares of Series D Preferred Stock. During the quarter ended December 31, 2022, all these 147,864,810 warrants were exercised on a cash-less basis for 229,098,769 shares of common stock. There are no warrants remaining associated with the Series D at December 31, 2022. In November 2022, the Company issued $150,000,000 of debt convertible into shares of common stock and warrants (see Note 6 Debt). As a result of the conversion of $59,402,877 of the convertible debt into shares of common stock in November 2022, 408,532,797 of these warrants were deemed to be issued and are outstanding at December 31, 2022. The Warrants provide that if the Company issues or sells, enters into a definitive, binding agreement pursuant to which he Company is required to issue or sell or is deemed, pursuant to the provisions of the Warrants, to have issued or sold, any shares of Common Stock for a price per share lower than the exercise price then in effect, subject to certain limited exceptions, then the exercise price of the Warrants shall be reduced to such lower price per share. In addition, the exercise price and the number of shares of Common Stock issuable upon exercise of the Warrants are subject to adjustment in connection with stock splits, dividends or distributions or other similar transactions. The following table summarizes warrant activity for the three months ended December 31, 2022: Weighted Average MAI shares Exercise Price Warrants outstanding at September 30, 2022 150,838,086 $ 0.60352 Warrants exercised 150,838,086 $ 0.60352 Warrants granted 408,532,797 $ 0.303 Warrants expired — $ — Warrants outstanding at December 31, 2022 408,532,797 $ 0.303 |
LOSS PER SHARE
LOSS PER SHARE | 3 Months Ended |
Dec. 31, 2022 | |
LOSS PER SHARE | |
LOSS PER SHARE | NOTE 9 – LOSS PER SHARE Earnings per common share (“EPS”) is computed by dividing net income allocated to common stockholders by the weighted-average common shares outstanding, excluding unvested common shares subject to repurchase or cancellation. Diluted EPS is computed by dividing income allocated to common stockholders plus dividends on dilutive convertible preferred stock and preferred stock that can be tendered to exercise warrants, by the weighted-average common shares outstanding plus amounts representing the dilutive effect of outstanding warrants and the dilution resulting from the conversion of convertible preferred stock, if applicable. For the three months ended December 31, 2022, and 2021, the convertible debt and shares of Preferred Stock were excluded from the diluted share count because the result would have been antidilutive under the “if-converted method.” The warrants to purchases shares of common stock also were excluded from the computation because the result would have been antidilutive. The following table presents the reconciliation of net income attributable to common stockholders to net income used in computing basic and diluted net income per share of common stock: Three months ended December 31, 2022 2021 Net income attributable to common stockholders $ (376,275,786) $ (156,061,550) Less: accumulated preferred stock dividends (638,677) - Net income used in computing basic net income per share of common stock $ (376,914,463) $ (156,061,550) Net loss per share $ (0.28) $ (8.93) Weighted average shares outstanding, basic and diluted 1,360,570,075 17,471,173 |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 3 Months Ended |
Dec. 31, 2022 | |
SHARE-BASED COMPENSATION | |
SHARE-BASED COMPENSATION | NOTE 10 – SHARE-BASED COMPENSATION The Company has a share incentive plan that is part its annual discretionary share-based compensation program. The plan includes consultants and employees, including directors and officers. For employees, they are notified of company share incentives during the onboarding process. The employee’s offer letter briefly describes the plan. Subject to the approval of our Board of Directors Compensation Committee, employees are issued a specified number of shares of the Company’s common stock. The total expense recognized for share awards represents the grant date fair value of such awards, which is generally recognized as a charge to income ratably over the vesting period. Consulting agreements with shares for services have a cost determined by the number of shares granted within the individual contract multiplied by the market value of the shares provided on date of grant. The shares specified within the individual agreements are negotiated and approved by our Chief Executive Officer. The consultant typically earns share-based compensation over the service period which is generally recognized as a charge to income ratably over the vesting period. The common shares provided for services are accounted for as professional fees within G&A expense and employee share issuances are part of compensation expense. For the three months ended December 31, Composition of Stock-Based Compensation Expense 2022 2021 Directors, officers and employees share-based compensation $ 36,376,972 $ 1,604,293 Shares issued to consultants for services 4,376,438 2,495,487 Total share-based compensation expense $ 40,753,410 $ 4,099,780 |
ACCRUED EXPENSES AND OTHER CURR
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | 3 Months Ended |
Dec. 31, 2022 | |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | NOTE 11 – ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES December 31, 2022 September 30, 2022 Accrued Expenses and Other Liabilities Accrued expense - other $ 1,462,046 $ 3,529,383 IRS tax liability 1,245,024 1,744,707 Accrued payroll 499,814 534,782 Accrued interest 3,019,085 1,377,008 Total $ 6,225,969 $ 7,185,881 Accrued payroll represents salaries and benefits that are owed to employees, including payroll tax liabilities. Accrued interest |
LIABILITY TO ISSUE STOCK
LIABILITY TO ISSUE STOCK | 3 Months Ended |
Dec. 31, 2022 | |
LIABILITY TO ISSUE STOCK | |
LIABILITY TO ISSUE STOCK | NOTE 12 – LIABILITY TO ISSUE STOCK Liability represents stock payable that is accrued for and issuable at a future date for certain convertible securities and warrants and was zero as of December 31, 2022. The liability to issue stock as of December 31, 2022, was management stock compensation of $11,599,598. As of September 30, 2022, liability to issue stock to Esousa was $10,710,000. |
PROPERTY, EQUIPMENT AND LEASEHO
PROPERTY, EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET | 3 Months Ended |
Dec. 31, 2022 | |
PROPERTY, EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET | |
PROPERTY, EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET | NOTE 13 – PROPERTY, EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET Property, equipment, and leasehold improvements, net consists of the following: December 31, September 30, 2022 2022 Building $ 51,251,890 $ 8,306,697 Furniture and equipment 550,532 556,948 Vehicles 170,499 96,363 Computer hardware and software 1,082,334 1,013,308 Machinery and equipment 41,017,969 7,383,612 Construction-in-progress 548,915 269,778 Leasehold improvements 111,570 76,438 Subtotal 94,733,709 17,703,144 Less: accumulated depreciation (4,937,051) (2,899,428) Property, Equipment and Leasehold Improvements, net $ 89,796,658 $ 14,803,716 Depreciation expense related to property, equipment and leasehold improvements for the three months ended December 31, 2022, and 2021 was $2,037,623 and $84,042, respectively. On November 12, 2021, Mullen Investment Properties, LLC, the Company’s wholly owned real estate subsidiary, completed the $12,000,000 purchase of the Tunica County, MS property ("Advanced Manufacturing and Engineering Center" or "AMEC"). The property is located at 1 Greentech Drive, in the City of Robinsonville, MS. AMEC will be used to class 1 and class 2 EV cargo vans and the Mullen FIVE Crossover. The facility currently occupies 124,000 square feet of manufacturing space. The total available land on the property is over 100 acres. On the expanded site, Mullen plans to build a body shop, fully automated paint shop and a general assembly shop. Construction-in-progress includes development and construction that is currently in progress at the AMEX facility. The ELMS asset acquisition closed on November 30, 2022 (See NOTE 4 – Purchase of assets from ELMS), and include property, plant, and equipment additions of: ● The Mishawaka, Indiana factory, which consisted of land and building of $1.44 million and $41.29 million, respectively. ● All property including equipment, machinery, supplies, computer hardware, software, communication equipment, data networks and all other data storage, that totaled $33.6 million in machinery additions. |
OTHER NONCURRENT ASSETS
OTHER NONCURRENT ASSETS | 3 Months Ended |
Dec. 31, 2022 | |
OTHER NONCURRENT ASSETS | |
OTHER NONCURRENT ASSETS | NOTE 14 – OTHER NONCURRENT ASSETS Other assets consist of the following: December 31, 2022 September 30, 2022 Other Assets Other assets $ 101,833 $ 81,588 Show room vehicles 2,616,426 2,982,986 Security deposits 671,034 281,057 Total Other Assets $ 3,389,293 $ 3,345,631 |
OPERATING EXPENSES
OPERATING EXPENSES | 3 Months Ended |
Dec. 31, 2022 | |
OPERATING EXPENSES | |
OPERATING EXPENSES | NOTE 15 – OPERATING EXPENSES General and Administrative Expenses consists of the following: Three months ended December 31, 2022 2021 Professional fees $ 8,652,777 $ 5,139,332 Salaries 44,142,360 3,161,920 Depreciation 4,388,355 307,699 Amortization 405,972 — Lease 831,090 459,535 Settlements and penalties 20,844 294,812 Employee benefits 1,033,638 368,052 Utilities and office expense 255,039 179,028 Advertising and promotions 2,968,234 2,452,790 Taxes and licenses 102,358 72,279 Repairs and maintenance 181,239 19,220 Executive expenses and directors' fees 209,044 — Listing and regulatory fees 1,301,844 — Outside labor 78,534 — Other 424,683 446,416 Total $ 64,996,011 $ 12,901,084 Within professional fees is stock based compensation for services rendered to consultants. Salaries includes stock based compensation to officers and employees. The expense is recorded at fair value of the shares to be issued. For the three months ended December 31, 2022 and 2021, the Company recorded $40,753,410 and $916,295 respectively, for share based compensation, of which $36.1 million was attributable to CEO award plan stock compensation. Research and development Research and development for the three months ended December 31, 2022 and 2021 was $8,622,009 and $1,157,323, respectively. Costs are expensed as incurred. Research and development expenses primarily consist of Mullen Five EV and Mullen One EV cargo van development and are primarily comprised of external fees for engineering, homologation, and prototyping costs and personnel-related costs consultants. |
LEASES
LEASES | 3 Months Ended |
Dec. 31, 2022 | |
LEASES | |
LEASES | NOTE 16 – LEASES We have entered into various operating lease agreements for certain offices, manufacturing and warehouse facilities, and corporate aircraft. Operating leases are included in right-of-use assets, and current and noncurrent portion of lease liabilities, as appropriate. These right-of-use assets also include any lease payments made and initial direct costs incurred at lease commencement and exclude lease incentives. The lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. We have lease agreements which require payments for both lease and non-lease components and have elected to account for these as a single lease component. Certain leases provide for annual increases to lease payment based on an index or rate. We calculate the present value of future lease payments based on the index or at the lease commencement date for new leases. The table below presents information regarding our lease assets and liabilities: December 31, 2022 September 30, 2022 Assets: Operating lease right-of-use assets $ 4,763,589 $ 4,597,052 Liabilities: Operating lease liabilities, current (1,696,626) (1,428,474) Operating lease liabilities, non-current (3,381,024) (3,359,354) Total lease liabilities $ (5,077,650) $ (4,787,828) Weighted average remaining lease terms: Operating leases 2.14 years 2.63 years Weighted average discount rate: Operating leases 28 % 28 % Operating lease costs: For the three months ended December 31, 2022 2021 Fixed lease cost $ 771,771 $ 286,482 Variable lease cost 31,288 129,605 Short-term lease cost — 96,592 Sublease income (63,857) (53,144) Total operating lease costs $ 739,202 $ 459,535 Operating Lease Commitments Our leases primarily consist of land, land and building, or equipment leases. Our lease obligations are based upon contractual minimum rates. Most leases provide that we pay taxes, maintenance, insurance and operating expenses applicable to the premises. The initial term for most real property leases is typically 1 to 3 years, with renewal options of 1 to 5 years, and may include rent escalation clauses. For financing obligations, a portion of the periodic lease payments is recognized as interest expense and the remainder reduces the obligations. For operating leases, rent is recognized on a straight-line basis over the lease term, including scheduled rent increases and rent holidays. The following table reflects maturities of operating lease liabilities at December 31, 2022: Years ending December 31, 2023 (9 months) $ 2,134,292 2024 2,700,815 2025 2,088,711 2026 243,539 2027 15,173 Thereafter — Total lease payments $ 7,182,530 Less: imputed interest (2,104,880) Present value of lease liabilities $ 5,077,650 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Dec. 31, 2022 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | NOTE 17 – COMMITMENTS AND CONTINGENCIES ASC 450 governs the disclosure and recognition of loss contingencies, including potential losses from litigation, regulation, tax and other matters. The accounting standard defines a “loss contingency” as “an existing condition, situation, or set of circumstances involving uncertainty as to possible loss to an entity that will ultimately be resolved when one or more future events occur or fail to occur.” ASC 450 requires accrual for a loss contingency when it is “probable that one or more future events will occur confirming the fact of loss” and “the amount of the loss can be reasonably estimated.” From time to time, we are subject to asserted and actual claims and lawsuits arising in the ordinary course of business. Company management reviews any such legal proceedings and claims on an ongoing basis and follows appropriate accounting guidance when making accrual and disclosure decisions. We establish accruals for those contingencies where the incurrence of a loss is probable and can be reasonably estimated, and it discloses the amount accrued and the amount of a reasonably possible loss in excess of the amount accrued, if such disclosure is necessary for our consolidated financial statements to not be misleading. To estimate whether a loss contingency should be accrued by a charge to income, management evaluates, among other factors, the degree of probability of an unfavorable outcome and the ability to make a reasonable estimate of the amount of the loss. We do not record liabilities when the likelihood is probable, but the amount cannot be reasonably estimated. Loop Global Inc. agreement On December 13, we entered into a definitive agreement with Loop Global Inc. to develop co-branded vehicle charging station infrastructure solutions. Series E Preferred Stock Purchase Option We entered into a letter agreement with DBI wherein we are committed to provide DBI with a right to purchase up to $25 million worth of a to-be-issued Series E Convertible Preferred Stock and warrants. The option and its terms have not been finalized. Mullen Technologies, Inc. v. Qiantu Motor (Suzhou) Ltd. This claim was filed in the United States District Court for the Southern District of California (Case No. 3:19-cv-01979-W-DEB) on October 11, 2019. This matter arises out of a contract dispute between Mullen and Qiantu related to the engineering, design, support, and homologation of Qiantu’s K50 vehicle by Mullen. On July 1, 2020, the court ordered this matter to arbitration. It was submitted to the American Arbitration Association on February 9, 2021, for arbitration in Denver, Colorado. Mullen filed its Demand for Arbitration on February 16, 2021. Arbitration proceedings were then stayed for 90 days to accommodate settlement discussions. On November 3, 2021, Qiantu filed an Arbitration Answering Statement and Counterclaim or Joinder/Consolidation Request. Mullen filed its response on January 28, 2022. On February 11, 2022, the parties exchanged their Initial Requests for Documents. The August 1, 2022, arbitration hearing in this matter was rescheduled to October 17, 2022, to allow the parties to continue settlement negotiations. The parties agreed to reschedule the October 17, 2022, arbitration hearing to a future date while discovery and settlement negotiations continued. In November 2022, the parties agreed to further extend the Arbitration hearing date to February In early December, the parties reached an agreement in principle for resolution of the Arbitration proceedings which includes the acquisition of the Qiantu IP and the provision of a license to manufacture and sell the K-50 automobile in various territories. The parties are currently negotiating the terms of the proposed Settlement and License Agreement. Based upon information presently known to management, the Company believes that the potential liability from this claim, if any, will not have a material adverse effect on its financial condition, cash flows or results of operations. International Business Machines (“IBM”) This claim was filed in the Supreme Court of the State of New York on May 7, 2019. This matter arises out of a contract dispute between Mullen and IBM related to a joint development and technology license agreement, patent license agreement, and a logo trademark agreement. On September 24, 2019, IBM filed a motion for summary judgment. By order dated April 21, 2022, the court granted IBM’s motion for summary judgment and ordered an inquest as to damages on IBM’s breach of contract claims. On November 9, 2021, the court, pursuant to an inquest order, awarded damages in favor of IBM and on December 1, 2021, the court entered a judgment in favor of IBM in the amount of $5,617,192. Mullen filed a Notice of Appeal on December 2, 2021. On February 2, 2022, IBM filed a Motion to Amend the Judgment it had obtained to add Mullen Automotive and Ottava as Judgment Debtors. Mullen filed its Appeal on April 8, 2022. Settlement efforts were undertaken, and a settlement was reached in which Mullen paid the full amount of the Judgment with interest, for a total of approximately $5.9 million, but maintained its Appeal rights. IBM then filed a Motion to Dismiss the Appeal based on Mullen’s payment of the Judgment. Mullen filed an Opposition to the same on July 18, 2022, and the hearing of the matter was set for July 25, 2022. The Court took the same under submission, and a decision has still not been issued. The Appeal is still pending. Federal and State Tax Liabilities During the third quarter of 2022, the Company entered into an instalment agreement with the IRS to pay $45,000 per month related to unpaid federal payroll liabilities plus accrued interest and penalties. As of December 31, 2022, we had an accrued liability of approximately $1.2 million related to IRS liabilities. Raymond James and Associates (“RJA”) – Investment Banking Services Agreement On May 5, 2020, the Company entered into an agreement with Raymond James & Associates for public offering and placement agent services. The agreement called for payment of a cash retainer of $50,000, which remains unpaid. Upon the closing of any public offering, regardless of whether RJA procured the agreement regarding the offering, we are obligated to pay a financing fee of equal to the greater of a) 6.0% of aggregate gross proceeds and b) $3,000,000. The GEM Group On September 21, 2021, the GEM Group filed an arbitration demand and statement of claim against Mullen seeking declaratory relief and damages. This matter arises out of an alleged breached securities purchase agreement dated November 13, 2020. Mullen filed its answering statement on October 21, 2021. On November 9, 2021, the parties appointed an Arbitrator. GEM filed a dispositive motion on February 14, 2022. Mullen’s filed its opposition to the dispositive motion on March 3, 2022. On April 4, 2022, the Arbitrator denied GEM’s dispositive motion. The parties have completed all party and expert depositions and have exchanged settlement offers, but to date, no resolution has been achieved. The original December 12, 2022 through December 16, 2022 in person hearing date was vacated on December 1, 2022 by stipulation, wherein the parties agreed to conduct the hearing through written submissions on the issue of liability only. The remaining and reserved issues (attorneys’ fees, indemnification, and damages), shall be discussed between the parties after the Arbitrator issues a partial award regarding liability and determines whether further briefing or live testimony will be required. On January 9, 2023, the parties filed and exchanged their initial submissions. The parties filed and exchanged responsive submissions on January 23, 2023. TOA Trading LLC Litigation This claim arises out of an alleged breach of contract related to an unpaid finder’s fee. On April 11, 2022, Plaintiffs TOA Trading LLC and Munshibari LLC filed a complaint against Mullen Automotive, Inc. and Mullen Technologies, Inc. in the United States District Court for the Southern District of Florida. On May 18, 2022, the Company filed a Motion to Dismiss or in the Alternative, Transfer Venue. Plaintiffs filed their opposition on June 3, 2022. The Company filed its reply on June 8, 2022. The court has taken the motions under submission. The Company expects a ruling in the second quarter 2023. Based upon information presently known to management, the Company believes that the potential liability from this claim, if any, will not have a material adverse effect on its financial condition, cash flows or results of operations. Therefore, no liability has been reflected on the condensed consolidated financial statements. Mullen Stockholder Litigation Margaret Schaub v. Mullen Automotive, Inc. On May 5, 2022, Plaintiff Margaret Schaub, a purported stockholder, filed a putative class action complaint in the United States District Court Central District of California against the Company, as well as its Chief Executive Officer, David Michery, and the Chief Executive Officer of a predecessor entity, Oleg Firer (the “Schaub Lawsuit”). This lawsuit was brought by Schaub both individually and on behalf of a putative class of the Company’s shareholders, claiming false or misleading statements regarding the Company’s business partnerships, technology, and manufacturing capabilities, and alleging violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (“Exchange Act”) and Rule 10b-5 promulgated thereunder. The Schaub Lawsuit seeks to certify a putative class of shareholders, and seeks monetary damages, as well as an award of reasonable fees and expenses. On August 4, 2022, the Court issued an order consolidating the Schaub Lawsuit with the case captioned David Gru v. Mullen Automotive, Inc.), and appointing lead plaintiff and lead counsel. On September 23, 2022, Lead Plaintiff filed a Consolidated Amended Class Action Complaint (“Amended Complaint”) against the Company, Mr. Michery, and the Company’s predecessor, Mullen Technologies, Inc., premised on the same purported violations of the Exchange Act and Rule 10b-5, seeking to certify a putative class of shareholders, and seeking an award of monetary damages, as well as reasonable fees and expenses. Defendants filed their motion to dismiss the Amended Complaint on November 22, 2022, and a hearing on the motion to dismiss is currently scheduled for April 14, 2023. Jeff Witt v. Mullen Automotive, Inc. On August 1, 2022, Jeff Witt and Joseph Birbigalia, purported stockholders, filed a derivative action in the United States District Court for the Central District of California against the Company as a nominal defendant, Mr. Michery, Mr. Firer, and current or former Company directors Ignacio Novoa, Mary Winter, Kent Puckett, Mark Betor, William Miltner and Jonathan New (the “Witt Lawsuit”). This lawsuit asserts claims for breach of fiduciary duty, unjust enrichment, abuse of control, waste of corporate assets, and violation of Section 14 of the Exchange Act primarily in connection with the issues and claims asserted in the Schaub Lawsuit. The Witt Lawsuit seeks monetary damages, as well as an award of reasonable fees and expenses. On November 8, 2022, the Court consolidated this matter and the Morsy Lawsuit (see below) into one case, and on November 30, 2022 stayed the consolidated derivative action pending (1) dismissal of the consolidated securities class action (the Schaub Lawsuit discussed above), or (2) the filing of an answer in the consolidated securities class action and notice by any party that they no longer consent to the voluntary stay of this consolidated derivative action. The case currently remains stayed. Hany Morsy v. David Michery, et al. On September 30, 2022, Hany Morsy, a purported stockholder, filed a derivative action in the United States District Court for the Central District of California against the Company as a nominal defendant, Mr. Michery, Mr. Firer, former Company officer and director, Jerry Alban, and Company directors Mr. Novoa, Ms. Winter, Mr. Puckett, Mr. Betor, Mr. Miltner, and Mr. New (the “Morsy Lawsuit”). This lawsuit asserts claims for breach of fiduciary duty, abuse of control, gross mismanagement, waste of corporate assets, and violation of Section 14 of the Exchange Act primarily in connection with the issues and claims asserted in the Schaub Lawsuit. The Morsy Lawsuit seeks to direct the Company to improve its corporate governance and internal procedures, and also seeks monetary damages, pre-judgment and post-judgment interest, restitution, and an award of reasonable fees and expenses. On November 8, 2022, the Court consolidated this matter and the Witt Lawsuit (see above) into one case and stayed the consolidated action (as discussed above). Based upon information presently known to management, the Company believes that the potential liability from this claim, if any, will not have a material adverse effect on its financial condition, cash flows or results of operations. Therefore, no liability has been reflected on the condensed consolidated financial statements. Thomas Robbins v. David Michery, et al. On December 7, 2022, Thomas Robbins, a purported stockholder, filed a stockholder class action complaint for declaratory and injunctive relief in the Court of Chancery of the State of Delaware against the Company, Mr. Michery, and current or former Company directors Mr. Novoa, Ms. Winter, Mr. Betor, Mr. Anderson, Mr. Miltner, Mr. Puckett, and Mr. New (the “Robbins Lawsuit”). This lawsuit seeks declaratory and injunctive relief under 8 Del. C. §§ 225, 227, and 242 related to the vote on a series of proposal at a special meeting of Company stockholders that was held on December 23, 2022, and asserts claims for breach of fiduciary duty against all Company directors (except Mr. New). The Robbins Lawsuit also seeks an award of fees and costs related to this action. On December 16, 2022, the Court entered a limited status quo order in the Robbins Lawsuit (the “Status Quo Order”), with respect to the vote of shares at the Company’s December 23, 2022 special meeting (or any adjournment thereof), pending final disposition of this action. On January 5, 2023, the Court consolidated this action with the Foley Lawsuit (discussed below), appointing lead plaintiffs and lead counsel. On January 25, 2023, the Court entered an order vacating the Status Quo Order. Patrick V.P. Foley, Jr. and Jeffrey Pudlinski v. David Michery, et al. On December 13, 2022, Patrick V.P. Foley, Jr. and Jeffrey Pudlinski, purported stockholders, filed a stockholder class action complaint for declaratory and injunctive relief in the Court of Chancery of the State of Delaware against the Company, Mr. Michery, and current or former Company directors Mr. Novoa, Ms. Winter, Mr. Betor, Mr. Anderson, Mr. Miltner, Mr. Puckett, and Mr. New (the “Foley Lawsuit”). This lawsuit seeks declaratory and injunctive relief under 8 Del. C. §§ 225, 227, and 242 related to the vote on a series of proposal at a special meeting of Company stockholders that was held on December 23, 2022, and asserts claims for breach of fiduciary duty against all Company directors (except Mr. New). The Foley Lawsuit also seeks an award of fees and costs related to this action. On January 5, 2023, the Court consolidated this action with the Robbins Lawsuit (discussed above), appointing lead plaintiffs and lead counsel. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Dec. 31, 2022 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | NOTE 18 – RELATED PARTY TRANSACTIONS Transactions with Affiliates Prior to its corporate reorganization on November 5, 2021, Previous Mullen operated as a division of Mullen Technologies, Inc. (“MTI”). Subsequent to the corporate reorganization, the Company has provided management and accounting services to MTI. As of December 31, 2022, the Company incurred approximately $1.2 million of costs on behalf of MTI, which is reflected within non-current assets on the consolidated balance sheet. These following individuals comprise the board of directors of Bollinger Motors and are considers affiliates. Name of Director Company Function David Michery Mullen Automotive Chairman, CEO, and President Mary Winter Mullen Automotive Director and Secretary Robert Bollinger Bollinger Motors Founder and CEO John Masters Bollinger Motors Director Director Provided Services William Miltner William Miltner is a litigation attorney who provides legal services to Mullen Automotive and its subsidiaries. Mr. Miltner also is an elected Director for the Company, beginning his term in August 2021. For the three months ending December 31, 2022, Mr. Miltner received $146,687 for services rendered. Mr. Miltner has been providing legal services to us since 2020. Ignacio Novoa On June 9, 2022, the board of directors of the Company appointed Ignacio Novoa as a director effective as of June 28, 2022. Prior to his appointment, on January 12, 2022, the Company and Mr. Novoa entered into a 1-year Consulting Agreement, whereby Mr. Novoa provides electric vehicle market research, analysis of market trends in the electric vehicle industry and other research and services. Mary Winter On October 26, 2021, the Company entered into a 1-year |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Dec. 31, 2022 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | NOTE 19 – SUBSEQUENT EVENTS Company management has evaluated subsequent events through February 14, 2023, which is the date these condensed consolidated financial statements were available to be issued. Except as discussed below, management has determined that there were no subsequent events which required recognition, adjustment to or disclosure to the financial statements: Special Shareholder Meeting Results At the Special Meeting of Mullen Shareholders held on January 25, 2023, in order to meet NASDAQ listing requirements, a proposal for implementation of a reverse stock split was approved, which the company does not plan to enact in the event the stock eclipses the $1 mark between now and September 6th. Should the price of the Mullen common stock not reach $1 per share, management plans to implement the reverse split at a magnitude determined at that time. Also at the Special meeting, shareholders approved the proposal to increase the Company’s authorized Common Share capital from 1.75 billion to 5 billion shares and a corresponding increase of 500,000 shares of the Company’s preferred stock. As a result, Mullen’s authorized capital stock increased from 2.25 billion shares to 5.5 billion shares. Series C Preferred Stock Dividend Waiver On January 13, 2023, the Company and holders of Series C Preferred Stock entered into a waiver agreement pursuant to which such holders irrevocably waived their right to receive any and all cumulative 15.0% per annum fixed dividends on such Preferred Stock, including all unpaid accrued and accumulated dividends, pursuant to the terms set forth in the Company’s Second Amended and Restated Certificate of Incorporation. Settlement Agreement– Warrants Exercise and Share Issuance On January 13, 2023, the Company entered into Settlement Agreements and Releases with Acuitas Capital LLC, Jim Fallon and Mank Capital (the “Holders”) pursuant to which the Holders agreed to remit to the Company an aggregate of approximately $17.8 million (collectively, the “Settlement Payment”) the erroneous issuance by the Company of an aggregate exercise of 1,660,988 warrants for approximately 79 million common shares of stock. In consideration of the settlement, the Holders received the right to purchase (the “Settlement Additional Purchase Right”) additional shares of Series D Preferred Stock and warrants equal to $20 million as provided under the Securities Purchase Agreement, of units, consisting of one share of Preferred Stock and 185% Warrants for each share of Preferred Stock issued. The Settlement Additional Purchase Right may be exercised by a Holder in accordance with the same terms that apply to Additional Purchases as described in the Series D Securities Purchase Agreement; provided, however, that if a Holder exercises its Settlement Additional Purchase Right, it shall receive Additional Warrants for shares of Common Stock in exchange for the issue of a promissory note that will bear an annual interest rate of 3.5% . Stock Subscription On January 13, 2023, the Company entered into a promissory note with Acuitas Capital LLC (the “Borrower”) whereby Borrower unconditionally promises to pay the Company the principal amount of $17,721,868, together with all accrued interest thereon, as provided in this Promissory Note. For December 31, 2022, this amount is recorded as a stock subscription receivable. The promissory note bears an annual interest rate of 3.5% and the aggregate unpaid principal amount of the Loan, all accrued and unpaid interest, and all other amounts payable under this Note shall be due and payable on the earlier of (i) the date on which shares of Common Stock issuable upon conversion of the Series D Preferred Stock and Warrants issued pursuant to the Settlement Additional Purchase Right have been reserved for issuance and that the resale of such reserved shares of Common Stock have been registered on a registration statement filed with the U.S. Securities and Exchange Commission, and (ii) February 1, 2024. The Borrower may prepay at any time. Settlement Agreement– Series D Securities Purchase Agreement On January 13, 2023, the Company entered into a Settlement Agreement and Release in which investors waived the default prior to February 1, 2023, under the Series D Securities Purchase Agreement, and the Notes and the Warrants that were issued pursuant to Amendment No. 3. to the Series D Securities Purchase Agreement. In exchange, the Company grants the investors the right to purchase additional shares of Series D Preferred Stock and warrants in an amount equal to such investor’s pro rata portion of $10 million. Warrants issued pursuant to Settlement Agreements Warrants issued pursuant to the Settlement Additional Purchase Right and the Second Additional Purchase Right will permit cashless exercise to be calculated as a function of the warrant’s Black-Scholes value. The exercise price and number of shares issuable upon exercise of the warrants will further be adjusted upon the occurrence of certain events and holders will be allowed to participate in certain issuances and distributions (subject to certain limitations and restrictions), including certain stock dividends and splits and distributions of assets. The warrants will provide for certain purchase rights whereby if the Company grants, issues or sells any options, convertible securities or rights to purchase stock, warrants, securities or other property pro rata to the record holders of any class of Common Stock, then the holder will be entitled to acquire such purchase rights which the holder could have acquired if the holder had held the number of shares of Common Stock acquirable upon complete exercise of the warrant. The Company would also agree not to enter into any fundamental, transaction, such as a merger, sale of more than 50% of the outstanding voting shares, sale of substantially all assets, or business combination, unless the successor entity assumes all of the obligations of the Company under the Warrants and the other transaction documents related to the warrants. The Company must reserve out of authorized and unissued shares a number of shares of Common Stock equal to 250% of the maximum number of shares of Common Stock that are issuable upon exercise of the warrants from time to time. If the Company fails to timely deliver shares upon exercise of the Warrant, the Company will be required to either (A) pay the holder for each trading day on which shares are not delivered 1% of the product of the number of shares not so issued multiplied by the closing sale price of the Common Stock on the trading day immediately preceding the required delivery date, or (B) if the holder purchases shares of Common Stock in anticipation of delivery of shares upon exercise of the Warrant, cash in an amount equal to holder’s total purchase price of such shares. The exercisability of the warrants may also be limited if, upon exercise, the holder and its affiliates would in aggregate beneficially own more than 9.99% of the common stock. Utica Equipment Finance During January 2023, the Company paid a $125,000 underwriting deposit to Utica Equipment Finance (“UEF”) for underwriting a lease commitment of up to $50,000,000. UEF will advance up to 75% of the forced liquidation value of equipment provided to secure the lease. The lease term is 48 months with a lease factor of 2.934% of the funding amount. There is a 10% fee on the funded amount at end of lease term as well as annual fees of $10,000 plus travel costs for annual equipment reinspection. The underwriting deposit is refundable up to $100,000 or will otherwise be used to pay expenses associated with the lease. Common Stock Issuances During January, 2023, the Company issued 34,032,329 shares with a value of $9,561,561 which was primarily for CEO Equity Incentive. Between January 6, 2023, and February 8, 2023, the Company issued 19,513,727 shares for consulting services with a value of $7,412,744. Partial Conversion of $150 Million Note On February 9, 2022, approximately $40 million of the $150 million note was converted for 132,013,202 shares of the Company’s common stock and warrants to purchase 244,224,424 shares of common stock. |
RESTATEMENT
RESTATEMENT | 3 Months Ended |
Dec. 31, 2022 | |
RESTATEMENT | |
RESTATEMENT | NOTE 20 - RESTATEMENT Prior to the initial issuance of the Company's financial statements for the year ended September 30, 2022, management determined that the warrants issued with the preferred stock did not meet the conditions for equity classification, requiring liability treatment and measured at fair value. In addition, management also discovered that it did not reflect the impact of amendments that resulted in modifications in privileges for the warrants issued with the Series C Preferred Stock, which should have been accounted for as a deemed dividend at the time of modification. The following table summarizes the impacts of these error corrections on the Company's financial statements for each of the periods presented below: Statement of operations Impact of correction of error - year Quarter ended December 31, 2021 (Unaudited) As previously reported Adjustments As restated Loss from operations (14,058,407) — (14,058,407) Other financing costs - initial recognition of warrants at fair value — (108,979,229) (108,979,229) Revaluation of warrants — (10,618,382) (10,618,382) Other expenses (22,405,532) — (22,405,532) Net loss (36,463,939) (119,597,611) (156,061,550) Loss per share (2.09) (8.93) Weighted average common shares outstanding 17,471,173 17,471,173 |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Dec. 31, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Business Combination and Asset Acquisition | Business Combination Business acquisitions are accounted for in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 805 “Business Combinations”. FASB ASC 805 requires the reporting entity to identify the acquirer, determine the acquisition date, recognize and measure the identifiable tangible and intangible assets acquired, the liabilities assumed and any non-controlling interest in the acquired entity, and recognize and measure goodwill or a gain from the purchase. The acquiree’s results are included in the Company’s consolidated financial statements from the date of acquisition. Assets acquired and liabilities assumed are recorded at their fair values and the excess of the purchase price over the amounts assigned is recorded as goodwill. Adjustments to fair value assessments are recorded to goodwill over the measurement period (not longer than twelve months). The acquisition method also requires that acquisition-related transaction and post-acquisition restructuring costs be charged to expense. The Company completed the acquisition of Bollinger Motors, Inc on September 7, 2022. |
Use of Estimates | Use of Estimates The preparation of our financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the dates of the carve-out financial statements and the reported amounts of total expenses in the reporting periods. Estimates are used for, but not limited to, fair value of long-lived assets, fair value of financial instruments, depreciable lives of property and equipment, income taxes, contingencies, and inputs used to value stock-based compensation, valuation of common and preferred stock and warrants. Additionally, the rates of interest on several debt agreements have been imputed where there was no stated interest rate within the original agreement. The imputed interest results in adjustments to the debt amounts reported in our condensed consolidated financial statements prepared under U.S. GAAP. Loan valuations issues can arise when trying to determine the debt attributes, such as discount rate, credit loss factors, liquidity discounts, and pricing. Management bases its estimates on historical experience and on various other assumptions believed to be reasonable, the results of which form the basis for adjustments about the carrying values of assets and liabilities and the recording of costs and expenses that are not readily apparent from other sources. The actual results may differ materially from these estimates. |
Risks and Uncertainties | Risks and Uncertainties The Company operates within an industry that is subject to rapid technological change, intense competition, and serves an industry that has significant government regulations. It is subject to significant risks and uncertainties, including competitive, financial, developmental, operational, technological, required knowledge of industry governmental regulations, and other risks associated with an emerging business. Any one or combination of these or other risks could have a substantial influence on our future operations and prospects for commercial success. |
Cash and Cash Equivalents | Cash and Cash Equivalents Company management considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. There were no cash equivalents at December 31, 2022 or September 30, 2022. |
Restricted Cash | Restricted Cash Funds that are not available for immediate use and must use for a specific purpose. These funds include the refundable deposits for individuals and businesses who have made deposits for Mullen and Bollinger vehicles and the cash in escrow. On December 31, 2022, the restricted cash balance was $39,357,576. Customer deposits are accounted for within other liabilities. |
Prepaid Expenses and Other Current Assets | Prepaid Expenses and Other Current Assets Prepaid expenses consist of various advance payments made for goods or services to be received in the future. These prepaid expenses include insurance and other contracted services requiring up-front payments. |
Property, Equipment and Leasehold Improvements, Net | Property, Equipment and Leasehold Improvements, Net Property, equipment, and leasehold improvements are stated at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated economic useful lives of the assets. Repairs and maintenance expenditures that do not extend the useful lives of related assets are expensed as incurred. Estimated Useful Lives Description Life Buildings 30 Years Furniture and Equipment 3 to 7 Years Computer and Software 1 to 5 Years Machinery and Equipment 3 Leasehold Improvements Shorter of the estimated useful life or the underlying lease term Vehicles 5 Years Intangibles 5 Expenditures for major improvements are capitalized, while minor replacements, maintenance and repairs, which do not extend the asset lives, are charged to operations as incurred. Upon sale or disposition, the cost and related accumulated depreciation are removed from the accounts and any gain or loss is included in operations. Company management continually monitors events and changes in circumstances that could indicate that the carrying balances of its property, equipment and leasehold improvements may not be recoverable in accordance with the provisions of ASC 360, “Property, Plant, and Equipment.” |
Income Taxes | Income Taxes Prior to Mullen’s capitalization and corporate reorganization, our operations were included in the tax filings of MTI. The cash and deferred tax positions between us and MTI and are formalized in a tax sharing agreement. Income taxes are recorded in accordance with ASC 740 , Income Taxes There are transactions that occur during the ordinary course of business for which the ultimate tax determination may be uncertain. At December 31, 2022 and September 30, 2022, there were no material changes to either the nature or the amounts of the uncertain tax positions. The Company’s income tax provision consists of an estimate for U.S. federal and state income taxes based on enacted rates, as adjusted for allowable credits, deductions, uncertain tax positions, changes in deferred tax assets and liabilities, and changes in the tax law. We maintain a full valuation allowance against the value of our U.S. and state net deferred tax assets because management does not believe the recoverability of the tax assets meets the “more likely than not” likelihood at December 31, 2022 and September 30, 2022. |
Intangible Assets | Intangible Assets Intangible assets consist of acquired and developed intellectual property and website development costs. In accordance with ASC 350, “Intangibles—Goodwill and Others,” Impairment of Long-Lived Assets The Company periodically evaluates property, plant and equipment and intangible assets for impairment whenever events or changes in circumstances indicate that a potential impairment may have occurred. If such events or changes in circumstances arise, the Company compares the carrying amount of the long-lived assets to the estimated future undiscounted cash flows expected to be generated by the long-lived assets. If the estimated aggregate undiscounted cash flows are less than the carrying amount of the long-lived assets, an impairment charge, calculated as the amount by which the carrying amount of the assets exceeds the fair value of the assets, is recorded. The fair value of the long-lived assets is determined based on the estimated discounted cash flows expected to be generated from the long-lived assets. The Company has not recorded any such impairment charges during the three months ended December 31, 2022 and 2021, respectively. |
Other Assets | Other Assets Other assets are comprised primarily of Coda electric vehicles and related parts, Show Room vehicles, and security deposits related to the Company’s property leases related to the EV business. |
Extinguishment of Liabilities | Extinguishment of Liabilities The Company derecognizes financial liabilities when the Company’s obligations are discharged, cancelled, or expired. |
Leases | Leases The Company follows the provisions of Accounting Standards Update, “Leases” (ASU 2016 02), which requires a lessee to recognize a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying leased asset for the lease term. |
Accrued Expenses | Accrued Expenses Accrued expenses are expenses that have been incurred but not yet paid and are classified within current liabilities on the consolidated balance sheets. |
General and Administrative Expenses | General and Administrative Expenses General and administrative (“G&A”) expenses include all non-production related expenses incurred by us in any given period. This includes expenses such as professional fees, salaries, rent, repairs and maintenance, utilities and office expense, employee benefits, depreciation and amortization, advertising and marketing, settlements and penalties, taxes, and licenses. Advertising costs are expensed as incurred and are included in G&A expenses. Other than trade show expenses which are deferred until occurrence of the future event, we expense advertising costs as incurred in accordance with ASC 720-35, “Other Expenses – Advertising Cost.” |
Research and Development Costs | Research and Development Costs Research and development costs are expensed as incurred. Research and development expenses consist primarily of costs associated with the development of our electric vehicle product lines. |
Share-Based Compensation | Share-Based Compensation We account for share-based awards issued by the Company in accordance with ASC Subtopic 718-10, “Compensation – Share Compensation”, which requires fair value measurement on the grant date and recognition of compensation expense for all common shares of the Company issued to employees, non-employees and directors. The fair value of non-marketable share-based awards has been estimated based on an independent valuation. The Company’s common and preferred share valuations have been appraised by an independent financial valuation advisor, based on assumptions management believes to be reasonable. Key assumptions and approaches to value used in estimating fair value, includes economic and industry data; business valuation; prior transactions; option value method and other cost, income, and market value approaches. Share-based compensation is included within general and administrative expenses. |
Related Party Transactions | Related Party Transactions We have related party transactions with certain of our directors, officers, and principal stockholders. These transactions are entered into in the ordinary course of business and include operational loans, convertible debt, and warrants providing financial support associated with the borrowing of funds. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments We apply fair value accounting for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value on a recurring basis. Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities that are required to be recorded at fair value, Company management considers the principal or most advantageous market in which we would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as risks inherent in valuation techniques, transfer restrictions and credit risk. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: Level 1 – Quoted prices in active markets for identical assets or liabilities. Level 2 – Level 3 – |
Concentrations of Business and Credit Risk | Concentrations of Business and Credit Risk We maintain cash balances in several financial institutions that are insured by either the Federal Deposit Insurance Corporation or the National Credit Union Association up to certain federal limitations, generally $250,000. At times, our cash balance may exceed these federal limitations and maintains significant cash on hand at certain of its locations. However, we have not experienced any losses in such accounts and management believes we are not exposed to any significant credit risk on these accounts. The amounts in excess of insured limits as of December 31, 2022 and September 30, 2022 are $67.3 million and $53.3 million, respectively. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards Accounting standard updates issued but not yet added were assessed and determined to be either not applicable or not expected to have a material impact on our consolidated financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended |
Dec. 31, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of Property, Equipment and Leasehold Improvements, Net Useful Lives | Description Life Buildings 30 Years Furniture and Equipment 3 to 7 Years Computer and Software 1 to 5 Years Machinery and Equipment 3 Leasehold Improvements Shorter of the estimated useful life or the underlying lease term Vehicles 5 Years Intangibles 5 |
PURCHASE OF ASSETS FROM ELMS (T
PURCHASE OF ASSETS FROM ELMS (Tables) | 3 Months Ended |
Dec. 31, 2022 | |
PURCHASE OF ASSETS FROM ELMS | |
Schedule of allocation of purchase price by asset category | Asset Category Fair Value Allocation Land $ 1,440,000 Buildings and site improvements 41,287,038 Personal property subtotal 33,577,045 Identified intangible: engineering design 22,112,791 Inventory 6,958,158 Total Identified Assets $ 105,375,032 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 3 Months Ended |
Dec. 31, 2022 | |
INTANGIBLE ASSETS | |
Schedule of finite lived intangible assets | December 31, 2022 September 30, 2022 Gross Net Gross Net Carrying Accumulated Carrying Carrying Accumulated Carrying Finite-Lived Intangible Assets Amount Amortization Amount Amount Amortization Amount Website design and development $ 2,660,391 (1,330,195) $ 1,330,195 $ 2,660,391 $ (1,108,496) $ 1,551,895 Intellectual property 58,375,794 (1,908,177) 56,467,618 58,375,794 (438,581) 57,937,213 Patents 32,391,186 (1,020,544) 31,370,642 32,391,186 (204,109) 32,187,077 Engineer design - ELMS 22,112,791 (184,273) 21,928,518 — — — Other 1,820,994 (80,876) 1,740,118 1,820,994 (16,175) 1,804,819 Trademark 540,840 — 540,840 466,014 — 466,014 Total Intangible Assets $ 117,901,996 $ (4,524,065) $ 113,377,931 $ 95,714,379 $ (1,767,361) $ 93,947,018 |
Schedule of future amortization expense for finite-lived intellectual property | Years Ended December 31, Future Amortization 2023 (nine months) $ 9,299,099 2024 12,202,651 2025 11,537,553 2026 11,537,553 2027 11,537,553 Thereafter 56,722,682 Total Future Amortization Expense $ 112,837,091 |
DEBT (Tables)
DEBT (Tables) | 3 Months Ended |
Dec. 31, 2022 | |
DEBT | |
Schedule of indebtedness of short term and long term debt | The following is a summary of our indebtedness at December 31, 2022: Net Carrying Value Unpaid Principal Contractual Contractual Type of Debt Balance Current Long-Term Interest Rate Maturity Matured notes $ 3,051,085 $ 3,051,085 $ - 0 - 10% 2019 - 2021 Promissory notes - - - NA NA Convertible notes 90,597,123 90,597,123 - 15.00% 2023 Real Estate notes 5,238,259 238,259 5,000,000 5.00 - 8.99% 2023-2024 Loans and advances 557,800 557,800 - 0.00% 2016 - 2018 Less: debt discount (716,535) (607,010) (109,525) NA NA Total Debt $ 98,727,732 $ 93,837,257 $ 4,890,475 The following is a summary of our indebtedness at September 30, 2022: Net Carrying Value Unpaid Principal Contractual Contractual Type of Debt Balance Current Long-Term Interest Rate Maturity Matured notes $ 3,051,085 $ 3,051,085 $ — 0.00 - 10.00% 2019 - 2021 Promissory notes 1,096,787 — 1,096,787 28.00% 2024 Real Estate note 5,247,612 247,612 5,000,000 5.0 - 8.99% 2023 - 2024 Loan advances 557,800 557,800 — 0.00 - 10.00% 2016 – 2018 Less: debt discount (932,235) — (932,235) NA NA Total Debt $ 9,021,049 $ 3,856,497 $ 5,164,552 |
Scheduled Debt Maturities | The following scheduled debt maturities at December 31, 2022: Years Ended September 30, 2023 (9 months) 2024 Total Total Debt $ 93,837,257 $ 4,890,475 $ 98,727,732 |
DERIVATIVE LIABILITIES AND FA_2
DERIVATIVE LIABILITIES AND FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Dec. 31, 2022 | |
DERIVATIVE LIABILITIES AND FAIR VALUE MEASUREMENTS | |
Schedule of fair value of derivative liability on recurring basis | December 31, Quoted Prices Significant Significant 2022 in Active Other Unobservable Markets for Observable Inputs Identical Assets Inputs (Level 3) (Level 1) (Level 2) Derivative liability $ 261,480,084 $ - $ - $ 261,480,084 |
A summary of the changes in derivative liability | Balance, September 30, 2022 $ - Transfers in due to issuance of warrants w/o having adequate authorized unissued shares available 244,510,164 Derivative liability authorized shares shortfall (P&L) 26,932,880 Transfers in due to reclassification of equity instruments to derivative liabilities resulting from lack of authorized common shares 528,305 Transfers out due to conversions of convertible notes and accrued interest into common shares (10,491,265) Balance, December 31, 2022 $ 261,480,084 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 3 Months Ended |
Dec. 31, 2022 | |
STOCKHOLDERS' EQUITY | |
Summary of warrant activity | The following table summarizes warrant activity for the three months ended December 31, 2022: Weighted Average MAI shares Exercise Price Warrants outstanding at September 30, 2022 150,838,086 $ 0.60352 Warrants exercised 150,838,086 $ 0.60352 Warrants granted 408,532,797 $ 0.303 Warrants expired — $ — Warrants outstanding at December 31, 2022 408,532,797 $ 0.303 |
LOSS PER SHARE (Tables)
LOSS PER SHARE (Tables) | 3 Months Ended |
Dec. 31, 2022 | |
LOSS PER SHARE | |
Schedule of computation of basic and diluted net income per share | Three months ended December 31, 2022 2021 Net income attributable to common stockholders $ (376,275,786) $ (156,061,550) Less: accumulated preferred stock dividends (638,677) - Net income used in computing basic net income per share of common stock $ (376,914,463) $ (156,061,550) Net loss per share $ (0.28) $ (8.93) Weighted average shares outstanding, basic and diluted 1,360,570,075 17,471,173 |
SHARE- BASED COMPENSATION (Tabl
SHARE- BASED COMPENSATION (Tables) | 3 Months Ended |
Dec. 31, 2022 | |
SHARE-BASED COMPENSATION | |
Schedule of composition of stock-based compensation expense | For the three months ended December 31, Composition of Stock-Based Compensation Expense 2022 2021 Directors, officers and employees share-based compensation $ 36,376,972 $ 1,604,293 Shares issued to consultants for services 4,376,438 2,495,487 Total share-based compensation expense $ 40,753,410 $ 4,099,780 |
ACCRUED EXPENSES AND OTHER CU_2
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables) | 3 Months Ended |
Dec. 31, 2022 | |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | |
Schedule of accrued expenses and other current liabilities | December 31, 2022 September 30, 2022 Accrued Expenses and Other Liabilities Accrued expense - other $ 1,462,046 $ 3,529,383 IRS tax liability 1,245,024 1,744,707 Accrued payroll 499,814 534,782 Accrued interest 3,019,085 1,377,008 Total $ 6,225,969 $ 7,185,881 |
PROPERTY, EQUIPMENT AND LEASE_2
PROPERTY, EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET (Tables) | 3 Months Ended |
Dec. 31, 2022 | |
PROPERTY, EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET | |
Schedule of property and equipment, net | December 31, September 30, 2022 2022 Building $ 51,251,890 $ 8,306,697 Furniture and equipment 550,532 556,948 Vehicles 170,499 96,363 Computer hardware and software 1,082,334 1,013,308 Machinery and equipment 41,017,969 7,383,612 Construction-in-progress 548,915 269,778 Leasehold improvements 111,570 76,438 Subtotal 94,733,709 17,703,144 Less: accumulated depreciation (4,937,051) (2,899,428) Property, Equipment and Leasehold Improvements, net $ 89,796,658 $ 14,803,716 |
OTHER NONCURRENT ASSETS (Tables
OTHER NONCURRENT ASSETS (Tables) | 3 Months Ended |
Dec. 31, 2022 | |
OTHER NONCURRENT ASSETS | |
Schedule of other assets | December 31, 2022 September 30, 2022 Other Assets Other assets $ 101,833 $ 81,588 Show room vehicles 2,616,426 2,982,986 Security deposits 671,034 281,057 Total Other Assets $ 3,389,293 $ 3,345,631 |
OPERATING EXPENSES (Tables)
OPERATING EXPENSES (Tables) | 3 Months Ended |
Dec. 31, 2022 | |
OPERATING EXPENSES | |
Schedule of Operating Expenses | General and Administrative Expenses consists of the following: Three months ended December 31, 2022 2021 Professional fees $ 8,652,777 $ 5,139,332 Salaries 44,142,360 3,161,920 Depreciation 4,388,355 307,699 Amortization 405,972 — Lease 831,090 459,535 Settlements and penalties 20,844 294,812 Employee benefits 1,033,638 368,052 Utilities and office expense 255,039 179,028 Advertising and promotions 2,968,234 2,452,790 Taxes and licenses 102,358 72,279 Repairs and maintenance 181,239 19,220 Executive expenses and directors' fees 209,044 — Listing and regulatory fees 1,301,844 — Outside labor 78,534 — Other 424,683 446,416 Total $ 64,996,011 $ 12,901,084 |
LEASES (Tables)
LEASES (Tables) | 3 Months Ended |
Dec. 31, 2022 | |
LEASES | |
Summary of lease assets and liabilities and lease costs | The table below presents information regarding our lease assets and liabilities: December 31, 2022 September 30, 2022 Assets: Operating lease right-of-use assets $ 4,763,589 $ 4,597,052 Liabilities: Operating lease liabilities, current (1,696,626) (1,428,474) Operating lease liabilities, non-current (3,381,024) (3,359,354) Total lease liabilities $ (5,077,650) $ (4,787,828) Weighted average remaining lease terms: Operating leases 2.14 years 2.63 years Weighted average discount rate: Operating leases 28 % 28 % Operating lease costs: For the three months ended December 31, 2022 2021 Fixed lease cost $ 771,771 $ 286,482 Variable lease cost 31,288 129,605 Short-term lease cost — 96,592 Sublease income (63,857) (53,144) Total operating lease costs $ 739,202 $ 459,535 |
Summary of maturities of operating lease liabilities | Years ending December 31, 2023 (9 months) $ 2,134,292 2024 2,700,815 2025 2,088,711 2026 243,539 2027 15,173 Thereafter — Total lease payments $ 7,182,530 Less: imputed interest (2,104,880) Present value of lease liabilities $ 5,077,650 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 3 Months Ended |
Dec. 31, 2022 | |
RELATED PARTY TRANSACTIONS | |
Summary of related party transactions | Name of Director Company Function David Michery Mullen Automotive Chairman, CEO, and President Mary Winter Mullen Automotive Director and Secretary Robert Bollinger Bollinger Motors Founder and CEO John Masters Bollinger Motors Director |
RESTATEMENT (Tables)
RESTATEMENT (Tables) | 3 Months Ended |
Dec. 31, 2022 | |
RESTATEMENT | |
Schedule of impacts of error corrections | The following table summarizes the impacts of these error corrections on the Company's financial statements for each of the periods presented below: Statement of operations Impact of correction of error - year Quarter ended December 31, 2021 (Unaudited) As previously reported Adjustments As restated Loss from operations (14,058,407) — (14,058,407) Other financing costs - initial recognition of warrants at fair value — (108,979,229) (108,979,229) Revaluation of warrants — (10,618,382) (10,618,382) Other expenses (22,405,532) — (22,405,532) Net loss (36,463,939) (119,597,611) (156,061,550) Loss per share (2.09) (8.93) Weighted average common shares outstanding 17,471,173 17,471,173 |
DESCRIPTION OF BUSINESS AND B_2
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION (Details) - USD ($) $ in Millions | Oct. 13, 2022 | Sep. 07, 2022 |
ELMS' manufacturing plant in Mishawaka Indiana, all inventory, and intellectual property for their Class 1 and Class 3 vehicles | ||
Schedule of Equity Method Investments [Line Items] | ||
Acquisition of assets | $ 105 | |
Bollinger Motors, Inc | ||
Schedule of Equity Method Investments [Line Items] | ||
Total consideration | $ 148.6 | |
Beneficial ownership | 60% | |
Amount of vendor payables assumed and paid at closing | $ 10 |
LIQUIDITY, CAPITAL RESOURCES,_2
LIQUIDITY, CAPITAL RESOURCES, AND GOING CONCERN (Details) - USD ($) | 3 Months Ended | ||||
Nov. 21, 2022 | Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | |
LIQUIDITY, CAPITAL RESOURCES, AND GOING CONCERN | |||||
Cash and restricted cash | $ 107,429,211 | $ 84,375,085 | $ 61,460 | $ 42,174 | |
Cash used in operating activities | (33,200,000) | ||||
Proceeds from unsecured convertible notes | $ 150,000,000 | ||||
Accumulated Deficit | (1,266,183,241) | $ (889,907,455) | |||
Working capital deficit | $ 261,900,000 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Property, Equipment and Leasehold Improvements, Net (Details) | 3 Months Ended |
Dec. 31, 2022 | |
Buildings | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 30 years |
Furniture and equipment | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 7 years |
Furniture and equipment | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 3 years |
Computer hardware and software | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 5 years |
Computer hardware and software | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 1 year |
Machinery and equipment | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 7 years |
Machinery and equipment | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 3 years |
Vehicles | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 5 years |
Intangibles | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 10 years |
Intangibles | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 5 years |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Additional Information (Details) - USD ($) | 3 Months Ended | |
Dec. 31, 2022 | Sep. 30, 2022 | |
Cash equivalents | $ 0 | $ 0 |
Restricted cash | 39,357,576 | 30,289,400 |
Amounts in excess of insured limits | $ 67,300,000 | $ 53,300,000 |
Maximum | ||
Amortization period | 120 months |
PURCHASE OF ASSETS FROM ELMS -
PURCHASE OF ASSETS FROM ELMS - Purchase price allocation (Details) - ELMS $ in Millions | Nov. 30, 2022 item | Oct. 13, 2022 USD ($) |
Asset Acquisition [Line Items] | ||
Approximate sale consideration approved | $ | $ 105 | |
Maximum number of vehicles capable to produce per year | item | 50,000 |
PURCHASE OF ASSETS FROM ELMS _2
PURCHASE OF ASSETS FROM ELMS - Fair value allocation (Details) | Nov. 30, 2022 USD ($) |
Asset acquisition | |
Personal property subtotal | $ 33,600,000 |
ELMS | |
Asset acquisition | |
Land | 1,440,000 |
Buildings and site improvements | 41,287,038 |
Personal property subtotal | 33,577,045 |
Identified intangible: engineering design | 22,112,791 |
Inventory | 6,958,158 |
Total Identified Assets | $ 105,375,032 |
INTANGIBLE ASSETS - Intangible
INTANGIBLE ASSETS - Intangible assets - General information (Details) - USD ($) | 3 Months Ended | ||
Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 | |
Finite-Lived Intangible Assets [Line Items] | |||
Intangible assets recorded | $ 117,901,996 | $ 95,714,379 | $ 5,361 |
Estimated useful lives | 3 years | ||
Engineer Design - ELMS | |||
Finite-Lived Intangible Assets [Line Items] | |||
Intangible assets recorded | $ 22,187,617 | ||
Engineer Design - ELMS | ELMS | |||
Finite-Lived Intangible Assets [Line Items] | |||
Intangible assets recorded | $ 22,200,000 | ||
Intellectual Property | |||
Finite-Lived Intangible Assets [Line Items] | |||
Weighted average Useful life | 9 years 7 months 6 days |
INTANGIBLE ASSETS - Intangibl_2
INTANGIBLE ASSETS - Intangible assets - Total (Details) - USD ($) | Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 |
Intangible Assets, Gross (Excluding Goodwill) [Abstract] | |||
Gross Carrying Amount | $ 117,901,996 | $ 95,714,379 | $ 5,361 |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |||
Accumulated Amortization | (4,524,065) | (1,767,361) | |
Net Carrying Amount | 113,377,931 | 93,947,018 | |
Trademarks | |||
Intangible Assets, Gross (Excluding Goodwill) [Abstract] | |||
Trademark | 540,840 | 466,014 | |
Website design and development | |||
Intangible Assets, Gross (Excluding Goodwill) [Abstract] | |||
Gross Carrying Amount, Finite-lived | 2,660,391 | 2,660,391 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |||
Accumulated Amortization | (1,330,195) | (1,108,496) | |
Net Carrying Amount | 1,330,195 | 1,551,895 | |
Intellectual property | |||
Intangible Assets, Gross (Excluding Goodwill) [Abstract] | |||
Gross Carrying Amount, Finite-lived | 58,375,794 | 58,375,794 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |||
Accumulated Amortization | (1,908,177) | (438,581) | |
Net Carrying Amount | 56,467,618 | 57,937,213 | |
Patents | |||
Intangible Assets, Gross (Excluding Goodwill) [Abstract] | |||
Gross Carrying Amount, Finite-lived | 32,391,186 | 32,391,186 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |||
Accumulated Amortization | (1,020,544) | (204,109) | |
Net Carrying Amount | 31,370,642 | 32,187,077 | |
Engineer Design - ELMS | |||
Intangible Assets, Gross (Excluding Goodwill) [Abstract] | |||
Gross Carrying Amount, Finite-lived | 22,112,791 | ||
Gross Carrying Amount | 22,187,617 | ||
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |||
Accumulated Amortization | (184,273) | ||
Net Carrying Amount | 21,928,518 | ||
Other | |||
Intangible Assets, Gross (Excluding Goodwill) [Abstract] | |||
Gross Carrying Amount, Finite-lived | 1,820,994 | 1,820,994 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |||
Accumulated Amortization | (80,876) | (16,175) | |
Net Carrying Amount | $ 1,740,118 | $ 1,804,819 |
INTANGIBLE ASSETS - Schedule of
INTANGIBLE ASSETS - Schedule of total future amortization expense for finite-lived intellectual property (Details) - USD ($) | 3 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Future Amortization Expense | ||
2023 (nine months) | $ 9,299,099 | |
2024 | 12,202,651 | |
2025 | 11,537,553 | |
2026 | 11,537,553 | |
2027 | 11,537,553 | |
Thereafter | 56,722,682 | |
Total Future Amortization | 112,837,091 | |
Amortization | $ 2,756,704 | $ 223,676 |
DEBT - Summary of our indebtedn
DEBT - Summary of our indebtedness (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 | Nov. 15, 2022 | Sep. 30, 2022 | Mar. 07, 2022 |
Debt Instrument [Line Items] | |||||
Net Carrying Value Unpaid Principal Balance | $ 98,727,732 | $ 98,727,732 | $ 9,021,049 | ||
Current | 93,837,257 | 3,856,497 | |||
Long-term | 4,890,475 | 5,164,552 | |||
Less: debt discount | (716,535) | (932,235) | |||
Less: debt discount (Current) | (607,010) | ||||
Less: debt discount (Long-Term) | (109,525) | (932,235) | |||
Matured notes | |||||
Debt Instrument [Line Items] | |||||
Net Carrying Value Unpaid Principal Balance | 3,051,085 | 3,051,085 | |||
Current, before debt discount | $ 3,051,085 | $ 3,051,085 | |||
Matured notes | Maximum | |||||
Debt Instrument [Line Items] | |||||
Contractual Interest Rate | 10% | 0.10% | |||
Matured notes | Minimum | |||||
Debt Instrument [Line Items] | |||||
Contractual Interest Rate | 0% | 0% | |||
Promissory notes | |||||
Debt Instrument [Line Items] | |||||
Net Carrying Value Unpaid Principal Balance | $ 1,096,787 | ||||
Long-term, before debt discount | $ 1,096,787 | ||||
Contractual Interest Rate | 0.28% | 8.99% | |||
Convertible notes | |||||
Debt Instrument [Line Items] | |||||
Net Carrying Value Unpaid Principal Balance | $ 90,597,123 | ||||
Current, before debt discount | $ 90,597,123 | ||||
Contractual Interest Rate | 0.15% | 15% | |||
Real Estate notes | |||||
Debt Instrument [Line Items] | |||||
Net Carrying Value Unpaid Principal Balance | $ 5,238,259 | $ 5,247,612 | |||
Current, before debt discount | 238,259 | 247,612 | |||
Long-term, before debt discount | $ 5,000,000 | $ 5,000,000 | |||
Real Estate notes | Maximum | |||||
Debt Instrument [Line Items] | |||||
Contractual Interest Rate | 8.99% | 8.99% | |||
Real Estate notes | Minimum | |||||
Debt Instrument [Line Items] | |||||
Contractual Interest Rate | 5% | 5% | |||
Loans and advances | |||||
Debt Instrument [Line Items] | |||||
Net Carrying Value Unpaid Principal Balance | $ 557,800 | $ 557,800 | |||
Current, before debt discount | $ 557,800 | $ 557,800 | |||
Contractual Interest Rate | 0% | ||||
Loans and advances | Maximum | |||||
Debt Instrument [Line Items] | |||||
Contractual Interest Rate | 10% | ||||
Loans and advances | Minimum | |||||
Debt Instrument [Line Items] | |||||
Contractual Interest Rate | 0% |
DEBT - Scheduled debt maturitie
DEBT - Scheduled debt maturities (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 |
Debt Maturities | |||
2023 (9 months) | $ 93,837,257 | ||
2024 | 4,890,475 | ||
Net Carrying Value Unpaid Principal Balance | $ 98,727,732 | $ 98,727,732 | $ 9,021,049 |
DEBT - Notes and Advances (Deta
DEBT - Notes and Advances (Details) - Promissory notes - USD ($) | 3 Months Ended | |||
Mar. 07, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2022 | |
Debt Instrument [Line Items] | ||||
Interest rate (as a percent) | 8.99% | 0.28% | ||
Principal amount | $ 5,000,000 | |||
Debt instrument interest expense | $ 2,134,517 | $ 3,247,185 | ||
Amortization of debt discount | $ 1,157,209 | 150,151,130 | 19,212,176 | |
Derivative liability | 244,510,164 | |||
Additional interest expense | 94,510,164 | |||
Carrying amount of debt settled via issuance of stock during the period | 95,750,938 | $ 23,192,500 | ||
Remaining unamortized discount | $ 716,535 |
DEBT - Drawbridge Relationship
DEBT - Drawbridge Relationship (Details) - A&R Note - USD ($) | 3 Months Ended | |||
Jun. 27, 2022 | Jul. 23, 2020 | Dec. 31, 2022 | Jun. 17, 2022 | |
Debt Instrument [Line Items] | ||||
Shares issued on conversion of note | 28,000,000 | |||
Share price (in dollars per share) | $ 0.9918 | |||
Principal amount | $ 1,096,787 | |||
Issuance of common stock for convertible notes (in shares) | 17,500,000 | |||
Common shares accounted within liability to issue shares | 10,500,000 | |||
Additional penalty | $ 3,495,000 | |||
Maximum | Series E Preferred Stock | ||||
Debt Instrument [Line Items] | ||||
Series E Preferred Stock shares yet to be created | $ 25,000,000 | |||
Other DBI | ||||
Debt Instrument [Line Items] | ||||
Principal amount | $ 23,831,554 | |||
Maturity term | 2 years |
DEBT - Amended and Restated Sec
DEBT - Amended and Restated Secured Convertible Note and Security Agreement (Details) | 1 Months Ended | 3 Months Ended | ||||||
Nov. 21, 2022 USD ($) shares | Nov. 01, 2022 USD ($) shares | Oct. 14, 2022 USD ($) D shares | Nov. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) shares | Dec. 31, 2021 USD ($) | Nov. 15, 2022 USD ($) | Sep. 30, 2022 USD ($) | |
Debt Instrument [Line Items] | ||||||||
Debt discount | $ 716,535 | $ 932,235 | ||||||
Shares issued for conversion of convertible debt | 1,096,787 | |||||||
Loss on extinguishment | $ (6,412,170) | $ 74,509 | ||||||
Debt premium | $ 19,212,176 | |||||||
A&R Note | ||||||||
Debt Instrument [Line Items] | ||||||||
Liability to issue common shares | shares | 10,500,000 | |||||||
Convertible note payable | ||||||||
Debt Instrument [Line Items] | ||||||||
Amount of debt converted | $ 59,402,877 | $ 59,402,877 | ||||||
Debt instrument accrued interest | $ 3,019,085 | $ 1,374,925 | ||||||
Shares issued for conversion of convertible debt ( in shares) | shares | 220,828,539 | |||||||
Debt instrument interest expense | $ 94,510,164 | $ 150,000,000 | ||||||
Face amount of debt | $ 150,000,000 | |||||||
A&R Note | A&R Note | ||||||||
Debt Instrument [Line Items] | ||||||||
Liability to issue common shares | shares | 10,710,000 | |||||||
A&R Note | Esousa Holdings, LLC | A&R Note | ||||||||
Debt Instrument [Line Items] | ||||||||
Amount of debt converted | $ 1,032,217 | |||||||
Debt discount | 64,570 | |||||||
Debt instrument accrued interest | $ 316,127 | |||||||
Liability to issue common shares | shares | 10,500,000 | |||||||
Shares issued for conversion of convertible debt | $ 12,945,914 | |||||||
Shares issued for conversion of convertible debt ( in shares) | shares | 23,000,000 | |||||||
Shares issued fair value | $ 5,524,600 | |||||||
Loss on extinguishment | $ 6,412,170 | |||||||
Debt discount rate | 5% | |||||||
Trading days | D | 10 | |||||||
Debt instrument interest expense | $ 681,364 | |||||||
Debt premium | $ 681,364 | |||||||
A&R Note | Esousa Holdings, LLC | Convertible note payable | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt premium | $ 681,364 | |||||||
Face amount of debt | $ 12,945,914 | |||||||
Shares issuable upon conversion | shares | 62,048,066 | |||||||
Accrued interest | $ 171,174 |
DEBT - Convertible Notes (Detai
DEBT - Convertible Notes (Details) | 1 Months Ended | 3 Months Ended | |||||
Nov. 21, 2022 USD ($) $ / shares shares | Nov. 14, 2022 USD ($) tranche $ / shares | Nov. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) $ / shares | Nov. 15, 2022 USD ($) | Sep. 30, 2022 USD ($) | May 06, 2021 $ / shares | |
Debt Instrument [Line Items] | |||||||
Proceeds from investors in exchange for notes convertible into shares of the Company's Common Stock | $ 150,000,000 | ||||||
Warrants term | 5 years | ||||||
Warrants exercise price | $ / shares | $ 0.6877 | ||||||
Amendment No. 3 to Securities Purchase Agreement | |||||||
Debt Instrument [Line Items] | |||||||
Proceeds from investors in exchange for notes convertible into shares of the Company's Common Stock | $ 150,000,000 | ||||||
Remaining Commitment Amount, Number of tranches | tranche | 2 | ||||||
Share Purchase Price, Floor price (in dollars per share) | $ / shares | $ 0.10 | ||||||
Additional consideration for issuance of warrants | $ 0 | ||||||
Percentage of Preferred Stock exercisable for warrants | 185% | ||||||
Series D Preferred Stock | |||||||
Debt Instrument [Line Items] | |||||||
Closing price of the Common Stock | $ / shares | $ 1.27 | ||||||
Series D Preferred Stock | Amendment No. 3 to Securities Purchase Agreement | |||||||
Debt Instrument [Line Items] | |||||||
Remaining Commitment Amount | $ 90,000,000 | ||||||
Closing price of the Common Stock | $ / shares | $ 1.27 | ||||||
Convertible notes | |||||||
Debt Instrument [Line Items] | |||||||
Principal amount | $ 150,000,000 | ||||||
Interest rate (as a percent) | 0.15% | 15% | |||||
Conversion ratio | 1.85 | ||||||
Warrants term | 5 years | ||||||
Derivative liability | $ 244,510,164 | ||||||
Increase in debt discount | 150,000,000 | ||||||
Debt instrument interest expense | 94,510,164 | $ 150,000,000 | |||||
Debt instrument accrued interest | $ 3,019,085 | $ 1,374,925 | |||||
Amount of debt converted | $ 59,402,877 | $ 59,402,877 | |||||
Shares issued for conversion of convertible debt ( in shares) | shares | 220,828,539 | ||||||
Amount of reduction in derivative liabilities | $ 10,491,265 | ||||||
Gain on conversion | $ 9,965,728 | ||||||
Convertible notes | Share conversion price lower of (i) $0.303; or (ii) the closing price on November 18, 2022 | |||||||
Debt Instrument [Line Items] | |||||||
Original issue price | $ / shares | $ 0.303 |
DERIVATIVE LIABILITIES AND FA_3
DERIVATIVE LIABILITIES AND FAIR VALUE MEASUREMENTS - Embedded Derivatives (Details) | Dec. 31, 2022 USD ($) |
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |
Estimated fair value of embedded derivatives | $ 261,480,084 |
Expected term (in years) | Minimum | |
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |
Embedded derivative, measurement input | 0.08 |
Expected term (in years) | Minimum | Revaluation prior to conversion of underlying instrument | |
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |
Embedded derivative, measurement input | 0.02 |
Expected term (in years) | Maximum | |
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |
Embedded derivative, measurement input | 10 |
Expected term (in years) | Maximum | Revaluation prior to conversion of underlying instrument | |
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |
Embedded derivative, measurement input | 10 |
Volatility | Minimum | |
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |
Embedded derivative, measurement input | 1.35 |
Volatility | Minimum | Revaluation prior to conversion of underlying instrument | |
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |
Embedded derivative, measurement input | 1.35 |
Volatility | Maximum | |
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |
Embedded derivative, measurement input | 1.51 |
Volatility | Maximum | Revaluation prior to conversion of underlying instrument | |
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |
Embedded derivative, measurement input | 1.51 |
Dividend yield | |
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |
Embedded derivative, measurement input | 0 |
Dividend yield | Revaluation prior to conversion of underlying instrument | |
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |
Embedded derivative, measurement input | 0 |
Risk-free interest rate | Minimum | |
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |
Embedded derivative, measurement input | 3.88 |
Risk-free interest rate | Minimum | Revaluation prior to conversion of underlying instrument | |
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |
Embedded derivative, measurement input | 3.77 |
Risk-free interest rate | Maximum | |
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |
Embedded derivative, measurement input | 4.12 |
Risk-free interest rate | Maximum | Revaluation prior to conversion of underlying instrument | |
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |
Embedded derivative, measurement input | 3.97 |
DERIVATIVE LIABILITIES AND FA_4
DERIVATIVE LIABILITIES AND FAIR VALUE MEASUREMENTS - Financial Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) | Dec. 31, 2022 | Sep. 30, 2022 |
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | ||
Derivative liabilities | $ 261,480,084 | $ 84,799,179 |
Recurring | ||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | ||
Derivative liabilities | 261,480,084 | |
Recurring | Level 3 | ||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | ||
Derivative liabilities | $ 261,480,084 |
DERIVATIVE LIABILITIES AND FA_5
DERIVATIVE LIABILITIES AND FAIR VALUE MEASUREMENTS - Changes in derivative liability (Details) - Derivative Financial Instruments, Liabilities [Member] | 3 Months Ended |
Dec. 31, 2022 USD ($) | |
CHANGES IN DERIVATIVE LIABILITY | |
Derivative liability authorized shares shortfall (P&L) | $ 26,932,880 |
Transfers out due to conversions of convertible notes and accrued interest into common shares | (10,491,265) |
Balance, December 31, 2022 | 261,480,084 |
Issuance of warrants w/o having adequate authorized unissued shares available | |
CHANGES IN DERIVATIVE LIABILITY | |
Transfers in due to | 244,510,164 |
Reclassification of equity instruments to derivative liabilities resulting from lack of authorized common shares | |
CHANGES IN DERIVATIVE LIABILITY | |
Transfers in due to | $ 528,305 |
STOCKHOLDERS' EQUITY - Preferre
STOCKHOLDERS' EQUITY - Preferred Stock, Series AA and Series D Preferred Stock (Details) - USD ($) | 3 Months Ended | ||||
Nov. 14, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | Oct. 17, 2022 | Sep. 30, 2022 | |
Class of Stock [Line Items] | |||||
Preferred Stock, shares authorized | 500,000,000 | 500,000,000 | |||
Preferred Stock, par value | $ 0.001 | $ 0.001 | |||
Preferred Stock, shares issued | 1,575,079 | 5,721,897 | |||
Preferred Stock, shares outstanding | 1,575,079 | 5,721,897 | |||
Preferred shares issued for cash | $ 20,000,000 | ||||
Series AA Preferred Stock | |||||
Class of Stock [Line Items] | |||||
Preferred Stock, shares authorized | 1 | ||||
Preferred Stock, shares issued | 1 | 0 | |||
Preferred Stock, shares outstanding | 1 | 0 | |||
Voting rights | $ 1,300,000,000 | ||||
Preferred shares issued for cash (in shares) | 1 | ||||
Preferred shares issued for cash | $ 25,000 | ||||
Consideration for redemption of preferred stock | $ 25,000 | ||||
Series D Preferred Stock | |||||
Class of Stock [Line Items] | |||||
Preferred Stock, shares authorized | 437,500,001 | 437,500,001 | |||
Preferred Stock, shares issued | 363,098 | 4,359,652 | |||
Preferred Stock, shares outstanding | 363,098 | 4,359,652 | |||
Series D Preferred Stock | Minimum | |||||
Class of Stock [Line Items] | |||||
Shares designated | 87,500,001 | ||||
Series D Preferred Stock | Maximum | |||||
Class of Stock [Line Items] | |||||
Shares designated | 437,500,001 |
STOCKHOLDERS' EQUITY - Registra
STOCKHOLDERS' EQUITY - Registration Statement Form S-3 (Details) - USD ($) $ in Millions | Nov. 21, 2022 | Oct. 14, 2022 |
STOCKHOLDERS' EQUITY | ||
Maximum number of shares registered as resale by certain stockholders | 900,000,000 | |
Number of shares registered as resale | 23,000,000 | |
Shares issuable upon conversion of Series D Preferred Stock | 350,000,000 | |
Shares issuable upon exercise of outstanding warrants | 527,000,000 | |
Registration of Shares resold pursuant to issuance upon conversion of convertible notes issued to the Selling Stockholders | 220,828,539 | |
Proceeds from investors in exchange for notes convertible into shares of the Company's Common Stock | $ 150 |
STOCKHOLDERS, EQUITY - Redempti
STOCKHOLDERS, EQUITY - Redemption Rights and Dividends (Details) | 3 Months Ended | |
Dec. 31, 2022 USD ($) D | Dec. 31, 2021 USD ($) | |
Class of Stock [Line Items] | ||
Number of Trading Days | 10 | |
Number of Consecutive Trading Days | 20 | |
Average Daily Trading Volume of Common Stock | $ 2,000,000 | |
Series A Preferred Stock | ||
Class of Stock [Line Items] | ||
Preferred stock dividends declared or paid | $ 0 | $ 0 |
Series C Preferred Stock | ||
Class of Stock [Line Items] | ||
Percentage of redemption price in first year | 0% | |
Percentage of redemption price in second year | 120% | |
Percentage of redemption price in third year | 115% | |
Percentage of redemption price in fourth year | 110% | |
Percentage of redemption price in fifth year | 105% | |
Percentage of redemption price in sixth year and thereafter | 100% | |
Preferred stock dividends rate, percentage | 15% | |
Accrued dividend | $ 6,872,075 | |
Series D Preferred Stock | ||
Class of Stock [Line Items] | ||
Percentage of redemption price in first year | 0% | |
Percentage of redemption price in second year | 120% | |
Percentage of redemption price in third year | 115% | |
Percentage of redemption price in fourth year | 110% | |
Percentage of redemption price in fifth year | 105% | |
Percentage of redemption price in sixth year and thereafter | 100% | |
Minimum Term of Shares Issued and Outstanding | 1 year | |
Preferred stock redemption, number of trading days | D | 20 | |
Preferred stock redemption, number of consecutive trading days | D | 30 | |
Preferred stock dividends rate, percentage | 15% | |
Accrued dividend | $ 1,528,857,000,000 | |
Number of Trading Days | D | 10 | |
Number of Consecutive Trading Days | D | 20 | |
Average Daily Trading Volume of Common Stock | $ 27,500,000 |
STOCKHOLDERS' EQUITY - Liquidat
STOCKHOLDERS' EQUITY - Liquidation, Conversion and Voting Rights (Details) | 3 Months Ended | ||
Mar. 08, 2022 $ / shares | Dec. 31, 2022 USD ($) D Vote $ / shares | Mar. 07, 2022 $ / shares | |
Class of Stock [Line Items] | |||
Reverse stock ratio | 12.8485 | ||
Number of votes per share | Vote | 1,000 | ||
Minimum | |||
Class of Stock [Line Items] | |||
Aggregate public offering price | $ | $ 100,000,000 | ||
Series A Preferred Stock | |||
Class of Stock [Line Items] | |||
Price per share in purchase agreement (USD per share) | $ 1.29 | $ 0.10 | |
Conversion ratio | 100 | ||
Series B Preferred Stock | |||
Class of Stock [Line Items] | |||
Original issue price | $ 8.84 | ||
Series C Preferred Stock | |||
Class of Stock [Line Items] | |||
Original issue price | $ 8.84 | ||
Ratio of Trading Price to Conversion Price | 2 | ||
Trading days | D | 20 | ||
Consecutive trading days | D | 30 | ||
Value of average daily trading dollar volume | $ | $ 4,000,000 | ||
Series D Preferred Stock | |||
Class of Stock [Line Items] | |||
Ratio of Trading Price to Conversion Price | 2 | ||
Trading days | D | 20 | ||
Consecutive trading days | D | 30 | ||
Value of average daily trading dollar volume | $ | $ 27,500,000 | ||
Share price (in dollars per share) | $ 1.27 | ||
Series B And C Preferred Stock | |||
Class of Stock [Line Items] | |||
Price per share in purchase agreement (USD per share) | $ 8.84 | $ 0.6877 | |
Conversion ratio | 1 |
STOCKHOLDERS' EQUITY - Common S
STOCKHOLDERS' EQUITY - Common Stock (Details) - USD ($) | 1 Months Ended | 3 Months Ended | |
Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Class of Stock [Line Items] | |||
Common Stock, shares authorized | 1,750,000,000 | 1,750,000,000 | |
Common Stock, par value | $ 0.001 | $ 0.001 | |
Common Stock, shares issued | 833,468,180 | 1,693,663,180 | |
Common Stock, shares outstanding | 833,468,180 | 1,693,663,180 | |
Voting rights | one | ||
Common shares issued for cash | $ 10,894,659 | ||
Issuance of common stock as payment of penalty to shareholder | $ 5,520,000 | ||
Shares issued for conversion of convertible debt | 1,096,787 | ||
Issuance of common stock for convertible notes | 59,402,876 | ||
Common stock dividends declared or paid | $ 0 | ||
Series D Preferred Stock | |||
Class of Stock [Line Items] | |||
Common shares issued for cash (in shares) | 79,926,925 |
STOCKHOLDERS' EQUITY - Warrants
STOCKHOLDERS' EQUITY - Warrants (Details) - USD ($) | 1 Months Ended | 3 Months Ended | |||||
Nov. 21, 2022 | Nov. 30, 2022 | Sep. 30, 2022 | Dec. 31, 2022 | Nov. 15, 2022 | Nov. 05, 2021 | May 06, 2021 | |
Class of Stock [Line Items] | |||||||
Warrants exercise price | $ 0.6877 | ||||||
Warrants term | 5 years | ||||||
Shares issued for convertible notes | $ 59,402,876 | ||||||
Convertible notes | |||||||
Class of Stock [Line Items] | |||||||
Warrants term | 5 years | ||||||
Principal amount | $ 150,000,000 | ||||||
Amount of debt converted | $ 59,402,877 | $ 59,402,877 | |||||
Shares issued for convertible notes | $ 150,000,000 | ||||||
Series C Warrants | |||||||
Class of Stock [Line Items] | |||||||
Warrants exercise price | $ 8.84 | ||||||
Number of warrant exercise for cash-lesss | 2,973,276 | ||||||
Number of remaining unexercised warrants | 0 | ||||||
Exercised on a cash-less basis | 128,463,567 | ||||||
Series D Warrants | |||||||
Class of Stock [Line Items] | |||||||
Number of warrant exercise for cash-lesss | 147,864,810 | ||||||
Share issued for cash-less warrant exercise | 229,098,769 | ||||||
Number of remaining unexercised warrants | 0 | ||||||
Number of detachable warrants issued | 147,864,810 | ||||||
Embedded Detachable Warrants | |||||||
Class of Stock [Line Items] | |||||||
Number of remaining unexercised warrants | 408,532,797 | ||||||
Series D Preferred Stock | |||||||
Class of Stock [Line Items] | |||||||
Number of shares issued (in shares) | 79,926,925 |
STOCKHOLDERS' EQUITY - Summary
STOCKHOLDERS' EQUITY - Summary of Warrant Activity (Details) - Warrants | 3 Months Ended |
Dec. 31, 2022 $ / shares shares | |
MAI shares | |
Warrants outstanding at beginning | shares | 150,838,086 |
Warrants exercised | shares | 150,838,086 |
Warrants granted | shares | 408,532,797 |
Warrants outstanding at ending | shares | 408,532,797 |
Weighted Average Exercise Price | |
Warrants outstanding at beginning | $ / shares | $ 0.60352 |
Warrants exercised | $ / shares | 0.60352 |
Warrants granted | $ / shares | 0.303 |
Warrants outstanding at ending | $ / shares | $ 0.303 |
LOSS PER SHARE (Details)
LOSS PER SHARE (Details) - USD ($) | 3 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
LOSS PER SHARE | ||
Net income attributable to common stockholders | $ (376,275,786) | $ (156,061,550) |
Less: accumulated preferred stock dividends | (638,677) | |
Net Loss attributable to common shareholders | $ (376,914,463) | $ (156,061,550) |
Net loss per share, basic | $ (0.28) | $ (8.93) |
Net loss per share, diluted | $ (0.28) | $ (8.93) |
Weighted average shares outstanding, basic | 1,360,570,075 | 17,471,173 |
Weighted average shares outstanding, diluted | 1,360,570,075 | 17,471,173 |
SHARE- BASED COMPENSATION (Deta
SHARE- BASED COMPENSATION (Details) - USD ($) | 3 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Composition of Stock-Based Compensation Expense | ||
Employee MAI share issuance | $ 36,376,972 | $ 1,604,293 |
Shares issued to consultants for services | 4,376,438 | 2,495,487 |
MAI Share-Based compensation expense | $ 40,753,410 | $ 4,099,780 |
ACCRUED EXPENSES AND OTHER CU_3
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Details) - USD ($) | Dec. 31, 2022 | Sep. 30, 2022 |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | ||
Accrued expense - other | $ 1,462,046 | $ 3,529,383 |
IRS tax liability | 1,245,024 | 1,744,707 |
Accrued payroll | 499,814 | 534,782 |
Accrued interest | 3,019,085 | 1,377,008 |
Total | 6,225,969 | $ 7,185,881 |
Amount payable due to insufficient shares being available for conversion | $ 3,019,085 |
LIABILITY TO ISSUE STOCK (Detai
LIABILITY TO ISSUE STOCK (Details) - USD ($) | Dec. 31, 2022 | Sep. 30, 2022 |
Schedule of Liability to Issue Stock [Line items] | ||
Liability to issue shares for convertible securities and warrants | $ 0 | |
Liability to issue shares | 11,599,598 | $ 10,710,000 |
Esousa Holdings, LLC | ||
Schedule of Liability to Issue Stock [Line items] | ||
Liability to issue shares | $ 10,710,000 | |
Board and Executive Officer | ||
Schedule of Liability to Issue Stock [Line items] | ||
Liability to issue shares | $ 11,599,598 |
PROPERTY, EQUIPMENT AND LEASE_3
PROPERTY, EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET (Details) - USD ($) | 3 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2022 | |
Property, Plant and Equipment [Line Items] | |||
Subtotal | $ 94,733,709 | $ 17,703,144 | |
Less: accumulated depreciation | (4,937,051) | (2,899,428) | |
Property, Equipment and Leasehold Improvements, net | 89,796,658 | 14,803,716 | |
Depreciation | 2,037,623 | $ 84,042 | |
Buildings | |||
Property, Plant and Equipment [Line Items] | |||
Subtotal | 51,251,890 | 8,306,697 | |
Furniture and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Subtotal | 550,532 | 556,948 | |
Vehicles | |||
Property, Plant and Equipment [Line Items] | |||
Subtotal | 170,499 | 96,363 | |
Computer hardware and software | |||
Property, Plant and Equipment [Line Items] | |||
Subtotal | 1,082,334 | 1,013,308 | |
Machinery and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Subtotal | 41,017,969 | 7,383,612 | |
Construction-in-progress | |||
Property, Plant and Equipment [Line Items] | |||
Subtotal | 548,915 | 269,778 | |
Leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Subtotal | $ 111,570 | $ 76,438 |
PROPERTY, EQUIPMENT AND LEASE_4
PROPERTY, EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET - Mullen Investment Properties (Details) | Nov. 12, 2021 USD ($) a ft² |
PROPERTY, EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET | |
Payments to acquire property | $ | $ 12,000,000 |
Manufacturing space occupies | ft² | 124,000 |
Area of Land | a | 100 |
OTHER NONCURRENT ASSETS (Detail
OTHER NONCURRENT ASSETS (Details) - USD ($) | Dec. 31, 2022 | Sep. 30, 2022 |
OTHER NONCURRENT ASSETS | ||
Other assets | $ 101,833 | $ 81,588 |
Show Room Cars | 2,616,426 | 2,982,986 |
Security deposits | 671,034 | 281,057 |
Total Other Assets | $ 3,389,293 | $ 3,345,631 |
OPERATING EXPENSES (Details)
OPERATING EXPENSES (Details) - USD ($) | 3 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Professional fees | $ 8,652,777 | $ 5,139,332 |
Salaries | 44,142,360 | 3,161,920 |
Depreciation | 4,388,355 | 307,699 |
Amortization | 405,972 | |
Lease | 831,090 | 459,535 |
Settlements and penalties | 20,844 | 294,812 |
Employee benefits | 1,033,638 | 368,052 |
Utilities and office expense | 255,039 | 179,028 |
Advertising and promotions | 2,968,234 | 2,452,790 |
Taxes and licenses | 102,358 | 72,279 |
Repairs and maintenance | 181,239 | 19,220 |
Executive expenses and directors fees | 209,044 | |
Listing and regulatory Fees | 1,301,844 | |
Outside labor | 78,534 | |
Other | 424,683 | 446,416 |
Total | 64,996,011 | 12,901,084 |
Stock based compensation | 40,753,410 | $ 4,099,780 |
CEO award plan | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Stock based compensation | $ 36,100,000 |
OPERATING EXPENSES - Research a
OPERATING EXPENSES - Research and development (Details) - USD ($) | 3 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Research & Development | ||
Research and development | $ 8,622,009 | $ 1,157,323 |
LEASES - Lease assets and liabi
LEASES - Lease assets and liabilities (Details) - USD ($) | Dec. 31, 2022 | Sep. 30, 2022 |
Assets: | ||
Operating lease right-of-use assets | $ 4,763,589 | $ 4,597,052 |
Liabilities: | ||
Operating lease liabilities, current | (1,696,626) | (1,428,474) |
Operating lease liabilities, non-current | (3,381,024) | (3,359,354) |
Total lease liabilities | $ (5,077,650) | $ (4,787,828) |
Operating Lease, Liability, Statement of Financial Position [Extensible Enumeration] | Operating lease liabilities, current, Operating lease liabilities, non-current | Operating lease liabilities, current, Operating lease liabilities, non-current |
Weighted average remaining lease terms: Operating leases | 2 years 1 month 20 days | 2 years 7 months 17 days |
Weighted average discount rate: Operating leases | 28% | 28% |
LEASES - Operating lease costs
LEASES - Operating lease costs (Details) - USD ($) | 3 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Operating lease costs: | ||
Fixed lease cost | $ 771,771 | $ 286,482 |
Variable lease cost | 31,288 | 129,605 |
Short-term lease cost | 96,592 | |
Sublease income | (63,857) | (53,144) |
Total operating lease costs | $ 739,202 | $ 459,535 |
LEASES - Maturities of operatin
LEASES - Maturities of operating lease liabilities (Details) - USD ($) | Dec. 31, 2022 | Sep. 30, 2022 |
Year ending December 31, | ||
2023 (9 months) | $ 2,134,292 | |
2024 | 2,700,815 | |
2025 | 2,088,711 | |
2026 | 243,539 | |
2027 | 15,173 | |
Total lease payments | 7,182,530 | |
Less: imputed interest | (2,104,880) | |
Present value of lease liabilities | $ 5,077,650 | $ 4,787,828 |
Operating Lease, Liability, Statement of Financial Position [Extensible Enumeration] | Operating Lease, Liability, Current, Operating Lease, Liability, Noncurrent | Operating Lease, Liability, Current, Operating Lease, Liability, Noncurrent |
LEASES - Additional Information
LEASES - Additional Information (Details) | 3 Months Ended |
Dec. 31, 2022 | |
Lessee, Lease, Description [Line Items] | |
Option to extend | true |
Option to terminate | true |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Operating lease term | 1 year |
Renewal term | 1 year |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Operating lease term | 3 years |
Renewal term | 5 years |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Series E Preferred Stock Purchase Option (Details) - USD ($) $ / shares in Units, $ in Millions | Jun. 17, 2022 | May 06, 2021 |
CONTINGENCIES AND CLAIMS | ||
Warrants term | 5 years | |
Warrants exercise price | $ 0.6877 | |
Series E Preferred Stock Purchase Option | Series E Preferred Stock | ||
CONTINGENCIES AND CLAIMS | ||
Option to purchase maximum value of stock and warrants. | $ 25 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - International Business Machines (Details) - Lawsuit with IBM - USD ($) | Feb. 02, 2022 | Dec. 01, 2021 |
CONTINGENCIES AND CLAIMS | ||
Amount of judgment | $ 5,617,192 | |
Cash transferred to surety bonds to cover legal liability | $ 5,900,000 |
COMMITMENTS AND CONTINGENCIES_3
COMMITMENTS AND CONTINGENCIES - Federal and State Tax Liabilities (Details) - Payroll Tax Liability - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Dec. 31, 2022 | |
CONTINGENCIES AND CLAIMS | ||
Amount of monthly payments | $ 45,000 | |
Past due accrued liability | $ 1,200,000 |
COMMITMENTS AND CONTINGENCIES_4
COMMITMENTS AND CONTINGENCIES - Investment Banking Services Agreement (Details) - Investment Banking Services Agreement. - USD ($) | May 05, 2020 | May 04, 2020 |
CONTINGENCIES AND CLAIMS | ||
Amount of retainer for services | $ 50,000 | |
Threshold percentage of gross proceeds of the public offering | 6% | |
Threshold amount of gross proceeds from public offering | $ 3,000,000 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) | Dec. 31, 2022 USD ($) |
COMMITMENTS AND CONTINGENCIES | |
Litigation liability | $ 0 |
RELATED PARTY TRANSACTIONS - Tr
RELATED PARTY TRANSACTIONS - Transactions with Affiliates (Details) $ in Millions | Dec. 31, 2022 USD ($) |
Other Current Assets | Mullen Technologies, Inc. | |
Related Party Transaction [Line Items] | |
Due from affiliate, current | $ 1.2 |
RELATED PARTY TRANSACTIONS - Wi
RELATED PARTY TRANSACTIONS - William Miltner (Details) | 3 Months Ended |
Dec. 31, 2022 USD ($) | |
Legal services provided | William Miltner | |
Related Party Transaction [Line Items] | |
Amount paid for legal services | $ 146,687 |
RELATED PARTY TRANSACTIONS - Ig
RELATED PARTY TRANSACTIONS - Ignacio Novoa (Details) - USD ($) | 3 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Related Party Transaction [Line Items] | ||
Proceeds from shares issued for cash | $ 10,894,659 | |
Consulting agreements | Director | ||
Related Party Transaction [Line Items] | ||
Term of agreement | 1 year |
RELATED PARTY TRANSACTIONS - Ma
RELATED PARTY TRANSACTIONS - Mary Winter (Details) - USD ($) | 3 Months Ended | ||
Oct. 26, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Related Party Transaction [Line Items] | |||
Consulting payments | $ 8,652,777 | $ 5,139,332 | |
Consulting agreements | Mary Winters, Corporate Secretary and Director | |||
Related Party Transaction [Line Items] | |||
Term of agreement | 1 year | ||
Annual salary under agreement | $ 60,000 | ||
Monthly salary under agreement | $ 5,000 |
SUBSEQUENT EVENTS - Special Sha
SUBSEQUENT EVENTS - Special Shareholder Meeting (Details) - $ / shares | Jan. 25, 2023 | Sep. 06, 2023 | Jan. 24, 2023 | Dec. 31, 2022 | Sep. 30, 2022 |
SUBSEQUENT EVENTS | |||||
Common Stock, shares authorized | 1,750,000,000 | 1,750,000,000 | |||
Subsequent event | |||||
SUBSEQUENT EVENTS | |||||
Common Stock, shares authorized | 5,000,000,000 | 1,750,000,000 | |||
Preferred Stock, Increase in Shares Authorized | 500,000 | ||||
Capital shares authorized | 5,500,000 | 2,250,000 | |||
Subsequent event | Minimum | |||||
SUBSEQUENT EVENTS | |||||
Share price (in dollars per share) | $ 1 |
SUBSEQUENT EVENTS - Series C Pr
SUBSEQUENT EVENTS - Series C Preferred Stock Dividend Waiver (Details) - Series C Preferred Stock | 3 Months Ended | |
Jan. 13, 2023 | Dec. 31, 2022 | |
SUBSEQUENT EVENTS | ||
Preferred stock dividends rate, percentage | 15% | |
Subsequent event | ||
SUBSEQUENT EVENTS | ||
Preferred stock dividends rate, percentage | 15% |
SUBSEQUENT EVENTS - Settlement
SUBSEQUENT EVENTS - Settlement Agreement - Warrants Exercise and Share Issuance (Details) - Subsequent event - Warrant And Share Issuance Agreement [Member] - Acuitas Capital LLC, Jim Fallon and Mank Capital - Settlement Note $ in Millions | Jan. 13, 2023 USD ($) shares |
Subsequent Event [Line Items] | |
Amount to be received from holders | $ | $ 17.8 |
Cashless Warrant exercise (in shares) | shares | 1,660,988 |
Number of preferred stock consisted in on unit | shares | 79,000,000 |
Value of right to purchase additional shares and warrants | $ | $ 20 |
Percentage of warrants per preferred stock issued | 185% |
Percentage of additional interest rate | 3.50% |
SUBSEQUENT EVENTS - Stock Subsc
SUBSEQUENT EVENTS - Stock Subscription (Details) - Subsequent event - Acuitas Group LLC | Jan. 13, 2023 USD ($) |
SUBSEQUENT EVENTS | |
Stock subscription receivable | $ 17,721,868 |
Promissory note interest rate (as a percent) | 3.50% |
SUBSEQUENT EVENTS - Settlemen_2
SUBSEQUENT EVENTS - Settlement Agreement - Series D Securities Purchase Agreement (Details) - USD ($) $ in Millions | Jan. 13, 2023 | May 06, 2021 |
Subsequent Event [Line Items] | ||
Warrants term | 5 years | |
Subsequent event | Securities Purchase Agreement | Series D Preferred Stock | ||
Subsequent Event [Line Items] | ||
Value of right to purchase additional shares and warrants | $ 10 |
SUBSEQUENT EVENTS - Warrants is
SUBSEQUENT EVENTS - Warrants issued pursuant to Settlement Agreements (Details) - $ / shares | Jan. 13, 2023 | Dec. 31, 2022 | Sep. 30, 2022 |
Subsequent Event [Line Items] | |||
Closing Bid Price | $ 0.001 | $ 0.001 | |
Subsequent event | Settlement Agreement [Member] | Acuitas Capital LLC, Jim Fallon and Mank Capital | |||
Subsequent Event [Line Items] | |||
Percentage of amount payable upon failure to timely deliver shares | 1% | ||
Percentage of minimum beneficial ownership held | 9.99% | ||
Subsequent event | Settlement Agreement [Member] | Minimum | Acuitas Capital LLC, Jim Fallon and Mank Capital | |||
Subsequent Event [Line Items] | |||
Shares held restriction percentage of outstanding voting shares | 50% | ||
Percentage of shares issuable upon exercise of the warrants | 250% |
SUBSEQUENT EVENTS - Underwritin
SUBSEQUENT EVENTS - Underwriting Deposit (Details) - Subsequent event - Utica Equipment Finance ("UEF") | 1 Months Ended |
Jan. 31, 2023 USD ($) | |
SUBSEQUENT EVENTS | |
Underwriting deposit for lease commitment | $ 125,000 |
Lease commitment | $ 50,000,000 |
Forced liquidation value (as a percent) | 75% |
Operating lease term | 48 months |
Lease factor (as a percent) | 2.934% |
Funding fee (as a percent) | 10% |
Annual fees | $ 10,000 |
Refundable Deposits | $ 100,000 |
SUBSEQUENT EVENTS - Common Stoc
SUBSEQUENT EVENTS - Common Stock Issuances (Details) - USD ($) | 1 Months Ended | 3 Months Ended | ||
Feb. 08, 2023 | Jan. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Subsequent Event [Line Items] | ||||
Value of shares issued for CEO Equity Incentive | $ 30,267,660 | $ 4,425,268 | ||
Subsequent event | ||||
Subsequent Event [Line Items] | ||||
Number of shares issued for CEO Equity Incentive | 34,032,329 | |||
Value of shares issued for CEO Equity Incentive | $ 9,561,561 | |||
Number of shares issued for consulting services | 19,513,727 | |||
Value of shares issued for consulting services | $ 7,412,744 |
SUBSEQUENT EVENTS - Partial Con
SUBSEQUENT EVENTS - Partial Conversion (Details) - USD ($) | 3 Months Ended | |
Feb. 09, 2022 | Dec. 31, 2022 | |
Subsequent Event [Line Items] | ||
Issuance of common stock for convertible notes | $ 59,402,876 | |
Series D Preferred Stock Commitment | Amendment No. 3 to Securities Purchase Agreement | ||
Subsequent Event [Line Items] | ||
Issuance of common stock for convertible notes (in shares) | 132,013,202 | |
Series D Preferred Stock Commitment | Series D Preferred Stock | Amendment No. 3 to Securities Purchase Agreement | ||
Subsequent Event [Line Items] | ||
Face amount of debt | $ 150,000,000 | |
Issuance of common stock for convertible notes | $ 40,000,000 | |
Issuance of common stock for convertible notes (in shares) | 244,224,424 |
RESTATEMENT - Statement of Oper
RESTATEMENT - Statement of Operations (Details) - USD ($) | 3 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
RESTATEMENT | ||
Loss from Operations | $ (73,618,020) | $ (14,058,407) |
Other financing costs - initial recognition of warrants at fair value | (108,979,229) | |
Revaluation of warrants | (10,618,382) | |
Others | (22,405,532) | |
Net loss attributable to shareholders | (376,275,786) | (156,061,550) |
Net loss attributable to shareholders | $ (376,914,463) | $ (156,061,550) |
Loss per Share, Basic | $ (0.28) | $ (8.93) |
Weighted average shares outstanding, basic | 1,360,570,075 | 17,471,173 |
As Previously Reported | ||
RESTATEMENT | ||
Loss from Operations | $ (14,058,407) | |
Others | (22,405,532) | |
Net loss attributable to shareholders | $ (36,463,939) | |
Loss per Share, Basic | $ (2.09) | |
Weighted average shares outstanding, basic | 17,471,173 | |
Adjustments | ||
RESTATEMENT | ||
Other financing costs - initial recognition of warrants at fair value | $ (108,979,229) | |
Revaluation of warrants | (10,618,382) | |
Net loss attributable to shareholders | $ (119,597,611) |