Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Sep. 30, 2020 | Dec. 07, 2020 | Mar. 31, 2020 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | NEUROONE MEDICAL TECHNOLOGIES Corp | ||
Entity Central Index Key | 0001500198 | ||
Amendment Flag | false | ||
Document Type | 10-K | ||
Document Period End Date | Sep. 30, 2020 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Current Fiscal Year End Date | --09-30 | ||
Entity Current Reporting Status | Yes | ||
Entity Well Known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Shell Company | false | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Public Float | $ 17,100,000 | ||
Entity File Number | 000-54716 | ||
Entity Interactive Data Current | Yes | ||
Entity Common Stock, Shares Outstanding | 22,993,388 | ||
Entity Incorporation State Country Code | DE |
Balance Sheets
Balance Sheets - USD ($) | Sep. 30, 2020 | Sep. 30, 2019 |
Current assets: | ||
Cash | $ 4,036,397 | $ 260,749 |
Prepaid and other assets | 118,611 | 41,002 |
Total current assets | 4,155,008 | 301,751 |
Intangible assets, net | 156,523 | 178,838 |
Right-of-use asset | 282,211 | |
Property and equipment, net | 166,031 | 52,026 |
Total assets | 4,759,773 | 532,615 |
Current liabilities: | ||
Accounts payable | 762,538 | 1,152,472 |
Accrued expenses | 512,762 | 617,721 |
Convertible promissory notes (Note 8) | 1,007,206 | |
Deferred revenue | 73,434 | |
Total current liabilities | 2,355,940 | 1,770,193 |
Operating lease liability | 254,328 | |
Other liabilities | 83,333 | |
Total liabilities | 2,693,601 | 1,770,193 |
Commitments and contingencies (Note 4) | ||
Stockholders' equity (deficit): | ||
Preferred stock, $0.001 par value; 10,000,000 shares authorized as of September 30, 2020 and 2019; no shares issued or outstanding as of September 30, 2020 and 2019. | ||
Common stock, $0.001 par value; 100,000,000 shares authorized as of September 30, 2020 and 2019; 22,180,674 and 13,493,705 shares issued and outstanding as of September 30, 2020 and 2019, respectively. | 22,181 | 13,494 |
Additional paid-in capital | 32,923,022 | 15,987,799 |
Accumulated deficit | (30,879,031) | (17,238,871) |
Total stockholders' equity (deficit) | 2,066,172 | (1,237,578) |
Total liabilities and stockholders' equity (deficit) | $ 4,759,773 | $ 532,615 |
Balance Sheets (Parenthetical)
Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2020 | Sep. 30, 2019 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | ||
Preferred stock, shares outstanding | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 22,180,674 | 13,493,705 |
Common stock, shares outstanding | 22,180,674 | 13,493,705 |
Statements of Operations
Statements of Operations - USD ($) | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Income Statement [Abstract] | ||
Revenue from collaboration | $ 1,926,566 | |
Operating expenses: | ||
General and administrative | 4,753,036 | 4,284,205 |
Research and development | 2,075,791 | 1,529,189 |
Total operating expenses | 6,828,827 | 5,813,394 |
Loss from operations | (4,902,261) | (5,813,394) |
Interest expense | (7,524,581) | (284,557) |
Net valuation change of instruments measured at fair value | 804,529 | (129,763) |
Loss on note extinguishment | (2,017,847) | (553,447) |
Net loss | $ (13,640,160) | $ (6,781,161) |
Net loss per share: | ||
Basic and diluted | $ (0.84) | $ (0.57) |
Number of shares used in per share calculations: | ||
Basic and diluted | 16,246,130 | 11,857,571 |
Statement of Changes in Stockho
Statement of Changes in Stockholders' Equity (Deficit) - USD ($) | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Total |
Balance at Sep. 30, 2018 | $ 9,657 | $ 6,052,161 | $ (10,457,710) | $ (4,395,892) |
Balance, shares at Sep. 30, 2018 | 9,656,505 | |||
Stock-based compensation | 324,205 | 324,205 | ||
Issuance of common stock upon conversion of convertible promissory notes | $ 839 | 1,920,881 | 1,921,720 | |
Issuance of common stock upon conversion of convertible promissory notes, shares | 839,179 | |||
Issuance of warrants and reclassification of warrant liability upon conversion of convertible promissory notes | 1,565,402 | 1,565,402 | ||
Issuance of warrants and reclassification of warrant liability upon conversion of convertible promissory notes, shares | ||||
Issuance of common stock under 2019 and 2018 private placements | $ 2,508 | 4,558,707 | 4,561,215 | |
Issuance of common stock under 2019 and 2018 private placements, shares | 2,508,179 | |||
Issuance of warrants under 2019 and 2018 private placements | 1,709,233 | 1,709,233 | ||
Issuance costs related to 2019 and 2018 private placements | (1,168,679) | (1,168,679) | ||
Issuance of warrants to brokers related to 2019 and 2018 private placements | 378,838 | 378,838 | ||
Issuance of common stock for consulting services | $ 50 | 114,950 | 115,000 | |
Issuance of common stock for consulting services, shares | 50,000 | |||
Granting of options previously recorded as a liability | 38,696 | 38,696 | ||
Exercise of stock options | $ 198 | 52,313 | 52,511 | |
Exercise of stock options, shares | 198,043 | |||
Issuance of stock awards | $ 11 | 24,990 | 25,001 | |
Issuance of stock awards, shares | 10,503 | |||
Exercise of warrants | $ 231 | 416,102 | 416,333 | |
Exercise of warrants, shares | 231,296 | |||
Net loss | (6,781,161) | (6,781,161) | ||
Balance at Sep. 30, 2019 | $ 13,494 | 15,987,799 | (17,238,871) | (1,237,578) |
Balance, shares at Sep. 30, 2019 | 13,493,705 | |||
Conversion of convertible notes into common stock | $ 7,794 | 14,172,676 | 14,180,470 | |
Conversion of convertible notes into common stock, shares | 7,793,985 | |||
Issuance costs in connection with conversion of convertible notes into common stock | (161,881) | (161,881) | ||
Stock-based compensation | 798,242 | 798,242 | ||
Issuance of common stock under securities purchase agreement | $ 217 | 389,783 | 390,000 | |
Issuance of common stock under securities purchase agreement, shares | 216,666 | |||
Issuance of warrants in connection with convertible notes offering | 696,672 | 696,672 | ||
Issuance of warrants in connection with convertible notes offering, shares | ||||
Issuance of common stock for consulting services | $ 427 | 641,289 | 641,716 | |
Issuance of common stock for consulting services, shares | 426,583 | |||
Issuance of common stock upon vesting of restricted stock units | $ 173 | 395,839 | 396,012 | |
Issuance of common stock upon vesting of restricted stock units, shares | 173,190 | |||
Exercise of stock options | $ 76 | 2,603 | 2,679 | |
Exercise of stock options, shares | 76,545 | |||
Net loss | (13,640,160) | (13,640,160) | ||
Balance at Sep. 30, 2020 | $ 22,181 | $ 32,923,022 | $ (30,879,031) | $ 2,066,172 |
Balance, shares at Sep. 30, 2020 | 22,180,674 |
Statements of Cash Flows
Statements of Cash Flows - USD ($) | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Operating activities | ||
Net loss | $ (13,640,160) | $ (6,781,161) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Amortization and depreciation | 47,609 | 27,569 |
Stock-based compensation | 1,835,970 | 491,749 |
Non-cash interest on convertible promissory notes | 5,616,858 | 51,333 |
Non-cash discount amortization on convertible promissory notes | 233,224 | |
Fair value change of convertible promissory notes | (804,529) | |
Revaluation of premium conversion and warrant liability | 129,763 | |
Issuance costs attributed to financing activities | 1,907,723 | |
Non-cash lease expense | 22,943 | |
Loss on notes extinguishment | 2,017,847 | 553,447 |
Change in assets and liabilities: | ||
Prepaid and other assets | (77,609) | (35,624) |
Accounts payable | (269,601) | 770,612 |
Accrued expenses, deferred revenue, operating lease and other liabilities | (82,353) | (836,869) |
Net cash used in operating activities | (3,425,302) | (5,395,957) |
Investing activities | ||
Purchase of intangible assets | (65,000) | |
Purchase of property and equipment | (122,427) | (58,352) |
Net cash used in investing activities | (122,427) | (123,352) |
Financing activities | ||
Proceeds from issuance of convertible promissory notes | 8,357,500 | |
Proceeds from issuance of common stock in connection with private placements | 390,000 | 4,561,215 |
Proceeds from issuance of warrants in connection with private placements | 1,709,233 | |
Issuance costs in connection with convertible promissory notes | (1,125,241) | |
Issuance costs in connection with private placements | (384,894) | (689,494) |
Exercise of warrants | 416,333 | |
Exercise of stock-options | 2,679 | 52,511 |
Proceeds from paycheck protection program | 83,333 | |
Repayment of unsecured loans net of proceeds | (283,000) | |
Net cash provided by financing activities | 7,323,377 | 5,766,798 |
Net increase in cash | 3,775,648 | 247,489 |
Cash at beginning of period | 260,749 | 13,260 |
Cash at end of period | 4,036,397 | 260,749 |
Supplemental non-cash financing and investing transactions: | ||
Conversion of convertible promissory notes to equity | 14,180,470 | 1,678,361 |
Exercise of premium conversion derivative liability | 419,590 | |
Reclassification of warrant liability to equity | 835,723 | |
Unpaid issuance costs attributed to convertible notes and private placement | 95,735 | 100,347 |
Non-cash issuance of broker warrants in connection with convertible notes and private placements | 696,672 | 378,838 |
Stock-based compensation liability reclassification to equity | 11,153 | |
Operating lease right of use asset obtained in exchange for operating lease | 335,119 | |
Unpaid purchases of property and equipment | $ 16,872 |
Organization and Nature of Oper
Organization and Nature of Operations | 12 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Nature of Operations | NOTE 1 - Organization and Nature of Operations NeuroOne Medical Technologies Corporation (the "Company" or "NeuroOne"), a Delaware Corporation, is an early-stage medical technology company developing comprehensive neuromodulation cEEG and sEEG monitoring, ablation, and brain stimulation solutions to diagnose and treat patients with epilepsy, Parkinson's disease, essential tremors, and other brain related disorders. To date, the Company has recorded no commercial sales and has a limited expense history. The Company is currently raising capital to fund the development of its proprietary technology. The Company received 510(k) clearance from the FDA to market the initial device and expect to submit an application for 510(k) clearance for a second product by end of calendar year 2020 or first calendar quarter 2021. The Company is based in Eden Prairie, Minnesota. COVID-19 On March 11, 2020, the World Health Organization declared the outbreak of a novel coronavirus ("COVID-19") as a global pandemic, which continues to spread throughout the United States and around the world. As a result of the COVID-19 pandemic, the Company has experienced delays and disruptions in its pre-clinical and clinical trials, as well as interruptions in its manufacturing, supply chain, and research and development operations. Additionally, the development of the Company's technology was delayed in fiscal year 2020 due to interruption in global manufacturing and shipping due to the COVID-19 pandemic. For example, one of our key manufacturing partners and one of the Company's suppliers have had staffing issues due to COVID-19, leading to delays in the Company's development builds and delays in shipping product. Additionally, the Company's own staff has been impacted by infections and mandatory quarantines. The Company's plans for further testing or clinical trials may be further impacted by the continuing effects of COVID-19. The global outbreak of COVID-19 continues to rapidly evolve. In April 2020, given the impact of COVID-19 on the Company, the Company applied for and received loan funding of $83,333 under the Paycheck Protection Program ("PPP"). The Company may be required to repay any portion of the outstanding principal that is not forgiven, along with accrued interest, and it cannot provide any assurance that it will be eligible for loan forgiveness, or that any amount of the PPP loan will ultimately be forgiven. The extent to which the COVID-19 pandemic may impact the Company's business and pre-clinical and clinical trials will depend on future developments, which are highly uncertain and cannot be predicted with confidence, such as the effect of the pandemic on its suppliers and distributors and the global supply chain, the ultimate geographic spread of the disease, the duration of the outbreak, travel restrictions and social distancing in the U.S. and other countries, business closures or business disruptions and the effectiveness of actions taken in the U.S. and other countries to contain and treat the disease. The COVID-19 pandemic may also impact the Company's business because of employee illness, school closures, and other community response measures. The COVID-19 pandemic may also impact the Company's ability to secure additional financing, or its ability to up-list from our current OTC Market ("OTCQB") and may result in further modifications to its debt agreements. Although the Company cannot estimate the length or gravity of the impact of the COVID-19 outbreak at this time, if the pandemic continues, it may have a material adverse effect on the Company's results of future operations, financial position, and liquidity in fiscal year 2021 and beyond. |
Going Concern
Going Concern | 12 Months Ended |
Sep. 30, 2020 | |
Going Concern [Abstract] | |
Going Concern | NOTE 2 - Going Concern The accompanying financial statements have been prepared on the basis that the Company will continue as a going concern. The Company has incurred losses since inception, negative cash flows from operations, and an accumulated deficit of $30,879,031 as of September 30, 2020. The Company has not established a source of revenues to cover its full operating costs, and as such, has been dependent on funding operations through the issuance of debt and sale of equity securities. The Company does not have adequate liquidity to fund its operations without raising additional funds. These factors raise substantial doubt about its ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this condition. While the Company's future operating activities under the distribution and development agreement with Zimmer, Inc. coupled with its plans to raise capital or issue debt financing may provide additional liquidity in the future, these actions are not solely within the control of the Company. If the Company is unable to raise additional funds, or the Company's anticipated operating results are not achieved, management believes planned expenditures may need to be reduced in order to extend the time period that existing resources can fund the Company's operations. If management is unable to obtain the necessary capital, it may have a material adverse effect on the operations of the Company and the development of its technology, or the Company may have to cease operations altogether. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | NOTE 3 - Summary of Significant Accounting Policies Basis of Presentation The accompanying financial statements have been prepared in accordance with accounting standards generally accepted in the United States of America. Reclassifications Certain amounts presented in the prior year period have been reclassified to conform to current period financial statement presentation. The change in accounts payable and accrued expenses reported in the statements of cash flows during the comparable prior year period was reclassified into two separate line item categories. Management's Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, primarily in connection with the convertible promissory notes, and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates. Concentration of Credit Risk Financial instruments that potentially subject the Company to a concentration of credit risk consist of cash. The Company's cash is held by one financial institution in the United States. Amounts on deposit may at times exceed federally insured limits. The Company has not experienced any losses on its deposits since inception, and management believes that minimal credit risk exists with respect to these financial institutions. As of September 30, 2020, the Company had $3,786,397 of deposits in excess of federally insured amounts. Revenue Recognition Beginning October 1, 2018, the Company has followed the provisions of ASC 606, Revenue from Contracts with Customers In determining the appropriate amount of revenue to be recognized as it fulfills its obligations under its agreements, the Company performs the following steps: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations based on estimated selling prices; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account in ASC Topic 606. Performance obligations may include license rights, development services, and services associated with regulatory submission and approval processes. Significant management judgment is required to determine the level of effort required under an arrangement and the period over which the Company expects to complete its performance obligations under the arrangement. If the Company cannot reasonably estimate when its performance obligations are either completed or become inconsequential, then revenue recognition is deferred until the Company can reasonably make such estimates. Revenue is then recognized over the remaining estimated period of performance using the cumulative catch-up method. As part of the accounting for these arrangements, the Company must develop assumptions that require judgment to determine the stand-alone selling price of each performance obligation identified in the contract. The Company uses key assumptions to determine the stand-alone selling price, which may include forecasted revenues, development timelines, reimbursement rates for personnel costs, discount rates and probabilities of technical and regulatory success. The Company allocates the total transaction price to each performance obligation based on the estimated relative standalone selling prices of the promised goods or service underlying each performance obligation. Licenses of intellectual property: If the license to the Company's intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, the Company recognizes revenues from non-refundable, up-front fees allocated to the license when the license is transferred to the customer, and the customer can use and benefit from the license. For licenses that are bundled with other promises, the Company utilizes judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue from non-refundable, up-front fees. The Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. Milestone payments: At the inception of each arrangement that includes milestone payments, the Company evaluates whether the milestones are considered probable of being achieved and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the value of the associated milestone (such as a regulatory submission) is included in the transaction price. Milestone payments that are not within the control of the Company, such as approvals from regulators, are not considered probable of being achieved until those approvals are received. When the Company's assessment of probability of achievement changes and variable consideration becomes probable, any additional estimated consideration is allocated to each performance obligation based on the estimated relative standalone selling prices of the promised goods or service underlying each performance obligation and recorded in license, collaboration, and other revenues based upon when the customer obtains control of each element. Royalties: For arrangements that include sales-based royalties, including milestone payments based on the level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (a) when the related sales occur, or (b) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). Common Stock Valuation The Company has been utilizing pricing as quoted on the OTC Market as the basis for the fair value of the Company's common stock since September 30, 2019. Prior to September 30, 2019, the Company utilized methodologies in accordance with the framework of the American Institute of Certified Public Accountants' Technical Practice Aid, Valuation of Privately-Held Company Equity Securities Issued as Compensation, to estimate the fair value of its common stock (the "AICPA Valuation Framework"). The valuation methodology included estimates and assumptions that required the Company's judgment. These estimates and assumptions included a number of objective and subjective factors, including external market conditions affecting the biotechnology industry sector, and the likelihood of achieving a liquidity event, such as an offering or sale. Significant changes to the key assumptions used in the valuations would result in different fair values of common stock at each of those valuation dates. The fair value the Company's common stock is used as an input into the fair value determination of instruments recorded at fair value and stock option or other equity awards that the Company has issued. Fair Value of Financial Instruments The Company's accounting for fair value measurements of assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring or nonrecurring basis adheres to the Financial Accounting Standards Board ("FASB") fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows: ● Level 1 Inputs: Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the Company at the measurement date. ● Level 2 Inputs: Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability. ● Level 3 Inputs: Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at the measurement date. As of September 30, 2020 and 2019, the fair values of cash, prepaid, other assets, accounts payable and accrued expenses approximated their carrying values because of the short-term nature of these assets or liabilities. The fair value of the convertible notes outstanding during the year ended September 30, 2020 were based on both the fair value of our common stock, discount associated with the embedded redemption features, and cash flow models discounted at current implied market rates evidenced in recent arms-length transactions representing expected returns by market participants for similar instruments and are based on Level 3 inputs. The estimated fair value of the convertible promissory notes of the Company that were outstanding during year ended September 30, 2019 were based on amortized cost which was deemed to approximate fair value. The fair value of the warrant liability and the premium conversion derivatives associated with the convertible promissory notes outstanding during fiscal 2019 were based on both the estimated fair value of our common stock and cash flow models discounted at the then current implied market rates evidenced in arms-length transactions representing expected returns by market participants for similar instruments during that period and were based on Level 3 inputs. There were no transfers between fair value hierarchy levels during the years ended September 30, 2020 and 2019. The fair value of financial instruments measured on a recurring basis is as follows: As of Description Total Level 1 Level 2 Level 3 Liabilities: Convertible Notes $ 1,007,206 — — $ 1,007,206 Total liabilities at fair value $ 1,007,206 — — $ 1,007,206 The following table provides a roll-forward of the convertible notes, warrant liability and premium debt conversion derivatives measured at fair value on a recurring basis using unobservable level 3 inputs for the years ended September 30 as follows: 2020 Convertible notes Balance as of beginning of period – September 30, 2019 $ — Fair value attributed to convertible promissory notes upon issuance 13,974,358 Fair value attributed to note extinguishment 2,017,847 Conversion of convertible promissory notes to common stock (14,180,470 ) Change in fair value including accrued interest (804,529 ) Balance as of end of period – September 30, 2020 $ 1,007,206 2019 Warrant liability Balance as of beginning of period – September 30, 2018 $ 817,155 Change in fair value of warrant liability 18,568 Reclassification to equity upon conversion of convertible promissory notes (835,723 ) Balance as of end of period – September 30, 2019 $ — 2019 Premium debt conversion derivatives Balance as of beginning of period – September 30, 2018 $ 308,395 Change in fair value of premium debt conversion derivatives 111,195 Reclassification to equity upon conversion of convertible promissory notes (419,590 ) Balance as of end of period – September 30, 2019 $ — Intellectual Property The Company has entered into two licensing agreements with major research institutions, which allows for access to certain patented technology and know-how. Payments under those agreements are capitalized and amortized to general and administrative expense over the expected useful life of the acquired technology. Property and Equipment Property and equipment is recorded at cost and reduced by accumulated depreciation. Depreciation expense is recognized over the estimated useful lives of the assets using the straight-line method. The estimated useful life for equipment and furniture ranges from three to seven years and three years for software. Tangible assets acquired for research and development activities and that have alternative use are capitalized over the useful life of the acquired asset. Estimated useful lives are periodically reviewed, and, when appropriate, changes are made prospectively. Software purchased for internal use consists primarily of amounts paid for perpetual licenses to third-party software providers and installation costs. When certain events or changes in operating conditions occur, asset lives may be adjusted and an impairment assessment may be performed on the recoverability of the carrying amounts. Maintenance and repairs are charged directly to expense as incurred. Impairment of Long-Lived Assets The Company evaluates its long-lived assets, which consist of licensed intellectual property and property and equipment for impairment whenever events or changes in circumstances indicate that the carrying value of these assets may not be recoverable. The Company assesses the recoverability of long-lived assets by determining whether or not the carrying value of such assets will be recovered through undiscounted expected future cash flows. If the asset is considered to be impaired, the amount of any impairment is measured as the difference between the carrying value and the fair value of the impaired asset. Research and Development Costs Research and development costs are charged to expense as incurred. Research and development expenses may include costs incurred in performing research and development activities, including clinical trial costs, manufacturing costs for both clinical and pre-clinical materials as well as other contracted services, license fees, and other external costs. Non-refundable advance payments for goods and services that will be used in future research and development activities are expensed when the activity is performed or when the goods have been received, rather than when payment is made, in accordance with Accounting Standards Codification (ASC) 730, Research and Development Warrant Liability The Company issued warrants to purchase equity securities in connection with the issuance or amendment of the convertible promissory notes. The Company accounts for these warrants as a liability at fair value when the number of shares is not fixed and determinable. Additionally, issuance costs associated with the warrant liability are expensed as incurred and reflected as interest expense in the accompanying statements of operations. The Company adjusts the liability for changes in fair value until the earlier of the exercise or expiration of the warrants for any period when pricing protections in future equity financings remain in place, or until such time, if any, as the number of shares to be exercised becomes fixed, at which point the warrants will be classified in stockholders' equity (deficit) provided that there are sufficient authorized and unissued shares of common stock to settle the warrants and redeem any other contracts that may require settlement in shares of common stock. Any future change in fair value of the warrant liability, when outstanding, is recognized in the statements of operations. Premium Debt Conversion Derivatives The Company evaluates all conversion and redemption features contained in a debt instrument to determine if there are any embedded derivatives that require separation from the host debt instrument. An embedded derivative that requires separation is bifurcated from its host debt instrument and a corresponding discount to the host debt instrument is recorded. The discount is amortized and recorded to interest expense over the term of the host debt instrument using the straight-line method which approximates the effective interest method. The separated embedded derivative is accounted for separately on a fair market value basis. The Company records the fair value changes of a separated embedded derivative at each reporting period in the statements of operations based on the fair value of its common stock and cash flow models discounted at current implied market rates evidenced in recent arms-length transactions representing expected returns by market participants for similar instruments and are based on Level 3 inputs. Income Taxes For the Company, income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax base and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Deferred tax assets are reduced by a valuation allowance if it is more likely than not that some portion or all of the deferred tax asset will not be realized. Net Loss Per Share For the Company, basic loss per share of common stock is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted earnings or loss per share of common stock is computed similarly to basic earnings or loss per share except the weighted average shares outstanding are increased to include additional shares from the assumed exercise of any common stock equivalents, if dilutive. The Company's convertible promissory notes, warrants, stock options and restricted stock units while outstanding are considered common stock equivalents for this purpose. Diluted earnings is computed utilizing the treasury method for the warrants, stock options and restricted stock units. Diluted earnings with respect to the convertible promissory utilize the if-converted method. No incremental common stock equivalents were included in calculating diluted loss per share because such inclusion would be anti-dilutive given the net loss reported for the years ended September 30, 2020 and 2019. The following potential common shares were not considered in the computation of diluted net loss per share as their effect would have been anti-dilutive for the years ended September 30, 2020 and 2019: 2020 2019 Warrants 10,170,588 7,265,598 Stock options 1,478,485 845,840 Restricted stock units 88,478 31,515 Convertible notes 832,848 — Recent Accounting Pronouncements In February 2016, the FASB issued Accounting Standards Update ("ASU") 2016-02, Leases (Topic 842) and subsequently amended the guidance relating largely to transition considerations under the standard in January 2017 and July 2018. The objective of this update is to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. This ASU is effective for fiscal years beginning after December 15, 2018, including interim periods within those annual periods. The Company adopted the new standard on October 1, 2019 and it did not have a material impact on the Company's balance sheet, statements of comprehensive loss or statements of cash flows as the Company did not have any material lease agreements in place as of the adoption date. As such, the Company did not restate comparative periods and did not recognize any cumulative adjustment to retained earnings on the date of the adoption. The Company elected the short-term lease expedient upon adoption of the standard. In July 2017, the FASB issued ASU No. 2017-11, Earnings Per Share, Distinguishing Liabilities from Equity and Derivatives and Hedging In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement . ● Removals: the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy; the policy for timing of transfers between levels; and the valuation processes for Level 3 fair value measurements. ● Modifications: for investments in certain entities that calculate net asset value, an entity is required to disclose the timing of liquidation of an investee's assets and the date when restrictions from redemption might lapse only if the investee has communicated the timing to the entity or announced the timing publicly; and the amendments clarify that the measurement uncertainty disclosure is to communicate information about the uncertainty in measurement as of the reporting date. ● Additions: the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period; and the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. This guidance is effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should all be applied prospectively for only the most recent interim or annual period presented in the initial year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. Early adoption is permitted. An entity is permitted to early adopt any removed or modified disclosures upon issuance of ASU 2018-13 and delay adoption of the additional disclosures until their effective date. The Company is currently evaluating the impact of the new guidance and does not expect that it will have a material impact on its financial statements. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740) which amends the existing guidance relating to the accounting for income taxes. This ASU is intended to simplify the accounting for income taxes by removing certain exceptions to the general principles of accounting for income taxes and to improve the consistent application of GAAP for other areas of accounting for income taxes by clarifying and amending existing guidance. The ASU is effective for fiscal years beginning after December 15, 2020. The Company does not expect that the adoption of this new guidance will have a material impact on the Company's financial statements In August 2020, FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity's Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity's Own Equity, which, among other things, provides guidance on how to account for contracts on an entity's own equity. This ASU eliminates the beneficial conversion and cash conversion accounting models for convertible instruments. It also amends the accounting for certain contracts in an entity's own equity that are currently accounted for as derivatives because of specific settlement provisions. In addition, this ASU modifies how particular convertible instruments and certain contracts that may be settled in cash or shares impact the diluted EPS computation. The amendments in this ASU are effective for smaller reporting companies as defined by the SEC for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020. The Company is currently evaluating the impact of ASU 2020-06 on its financial statements. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Sep. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 4 - Commitments and Contingencies WARF License Agreement The Company has entered into an exclusive start-up company license agreement with the Wisconsin Alumni Research Foundation ("WARF") for WARF's neural probe array and thin film micro electrode technology (the "WARF Agreement"). The Company entered into an Amended and Restated Exclusive Start-up Company License Agreement (the "WARF License") with Wisconsin Alumni Research Foundation ("WARF") on January 21, 2020, which amended and restated in full the prior license agreement between WARF and NeuroOne, LLC, a predecessor of the Company, dated October 1, 2014, as amended on February 22, 2017, March 30, 2019 and September 18, 2019. The WARF License grants to the Company an exclusive license to make, use and sell, in the United States only, products that employ certain licensed patents for a neural probe array or thin-film micro electrode array and method. The Company has agreed to pay WARF a royalty equal to a single-digit percentage of its product sales pursuant to the WARF License, with a minimum annual royalty payment of $50,000 for 2020, $100,000 for 2021 and $150,000 for 2022 and each calendar year thereafter that the WARF License is in effect. If the Company or any of its sublicensees contest the validity of any licensed patent, the royalty rate will be doubled during the pendency of such contest and, if the contested patent is found to be valid and would be infringed by the Company if not for the WARF License, the royalty rate will be tripled for the remaining term of the WARF License. WARF may terminate the WARF License if the Company defaults on the payments of amounts due to WARF or fails to timely submit development reports, or breaches any other covenant in the WARF License and fails to remedy such default in ninety (90) days or in the event of certain bankruptcy events involving the Company. WARF may also terminate the WARF License on ninety (90) days' notice if the Company fails to have commercial sales of one or more FDA-approved products under the WARF License by June 30, 2021. The WARF License otherwise expires by its terms (i) on the date that no valid claims on the patents licensed thereunder remain or (ii) upon the cessation for more than four (4) calendar quarters of the payment, once begun, of earned royalties under certain sections of the WARF License. The Company expects the latest expiration of a licensed patent to occur in 2030. The first commercial sale occurred on December 7, 2020, prior to the June 30, 2021 deadline. See Note 13 – Subsequent Events. In addition, WARF reserves the right to grant non-profit research institutions and government agencies non-exclusive licenses to practice and use the inventions of the licensed patents for non-commercial research purposes, and the Company grants WARF a non-exclusive, sub licensable, royalty-free right and license for non-commercial research purposes to use improvements to the licensed patents. In the event that the Company discontinues use or commercialization of the licensed patents or improvements thereon, the Company must grant WARF an option to obtain a non-exclusive, sub-licensable royalty-bearing license to use the improvements for commercial purposes. Mayo Agreement The Company has an exclusive license and development agreement with the Mayo Foundation for Medical Education and Research ("Mayo") related to certain intellectual property and development services for thin film micro electrode technology ("Mayo Agreement"). If the Company is successful in obtaining regulatory approval, the Company is to pay royalties to Mayo based on a percentage of net sales of products of the licensed technology through the term of the Mayo Agreement, set to expire May 25, 2037. Legal PMT Litigation From time to time, the Company is subject to litigation and claims arising in the ordinary course of business. In May 2017, NeuroOne received a letter from PMT Corporation ("PMT"), the former employer of Mark Christianson and Wade Fredrickson. PMT claimed that these officers had breached their restrictive covenant obligations with PMT by virtue of their work for NeuroOne and such officer's prior work during employment with the prior employer, that these officers had breached their confidentiality and non-disclosure obligations to PMT and federal and state law by misappropriating confidential and trade secret information, and that the Company is responsible for tortious interference with contracts. The letter, which purported to attach a noncompete agreement signed by Mr. Fredrickson, demanded that Mr. Fredrickson (who resigned from the Company in June 2017), Mr. Christianson and NeuroOne cease and desist all competitive activities, that Mr. Fredrickson step down from his position and that Mr. Christianson and NeuroOne provide the former employer access to NeuroOne's systems to demonstrate that it is not using trade secrets or proprietary information nor competing with the former employer. On March 29, 2018, the Company was served with a complaint filed by PMT adding the Company, NeuroOne and Mr. Christianson to its existing lawsuit against Mr. Fredrickson in the Fourth Judicial District Court of the State of Minnesota. The complaint purported to attach Mr. Fredrickson's noncompete agreement as Exhibit A. In the lawsuit, PMT claims that Mr. Fredrickson and Mr. Christianson breached their non-competition, non-solicitation and non-disclosure obligations, breached their fiduciary duty obligations, were unjustly enriched, engaged in unfair competition, engaged in a civil conspiracy, tortiously interfered with PMT's contracts and prospective economic advantage, and breached a covenant of good faith and fair dealing. Against Mr. Fredrickson, PMT also alleges that he intentionally or negligently spoliated evidence, made negligent or fraudulent misrepresentations, misappropriated trade secrets in violation of Minnesota law, and committed the tort of conversion and statutory civil theft. Against the Company and NeuroOne, PMT alleges that the Company and NeuroOne were unjustly enriched and engaged in unfair competition. PMT asked the Court to impose a constructive trust over the shares held by Mr. Fredrickson and Mr. Christianson and to award compensatory damages, equitable relief, punitive damages, attorneys' fees, costs and interest. On April 18, 2018, Mr. Christianson, the Company and NeuroOne, Inc. filed a motion for dismissal, which was heard by the Court on October 11, 2018. The motion for dismissal states that: the contract claims against Mr. Christianson fail because his agreement was not supported by consideration; the Minnesota Uniform Trade Secrets Act preempts plaintiff's claims for unfair competition, civil conspiracy and unjust enrichment; plaintiff fails to state a claim regarding alleged breach of the duties of loyalty and good faith/fair dealing; plaintiff cannot legally obtain a constructive trust; plaintiff has insufficiently pled its tortious interference claims; and Plaintiff has not stated a claim for unfair competition. On January 7, 2019, the judge granted the motion for dismissal with respect to PMT's claim for breach of the duty of good faith and fair dealing, and denied the motion for dismissal with respect to the other claims presented. In April 2019, PMT served the Company, NeuroOne, Inc and Christianson with a proposed Second Amended Complaint, which included new claims against the Company and NeuroOne, Inc for tortious interference with contract and tortious interference with prospective business advantage and punitive damages against the Company, NeuroOne Inc. and Christianson. On June 28, 2019, the Company presented evidence indicating that PMT had participated in a fraud on the Court and sought an Order that PMT had waived the attorney client privilege. On July 16, 2019, the defendants served PMT with a joint notice of motion for sanctions seeking a variety of sanctions for litigation misconduct including, but not limited to, dismissal of the case and an award of attorneys' fees. The Company, NeuroOne Inc and Mr. Christianson further intend to move for summary judgment on all remaining claims asserted against them as well as for leave to assert counterclaims against PMT for abuse of process. The outcome of any claim against the Company by PMT was not estimable as of the filing of this Annual Report on Form 10-K. On August 30, 2019, the Hennepin County District Court heard dispositive motions in this case. The district court judge indicated some claims would likely be tried to a jury and encouraged the parties to settle. On September 12, 2019, the district court heard NeuroOne's motion for sanctions. The district court held the sanctions hearing on December 17, 2019 and December 18, 2019 and indicated that a ruling would be made in approximately 90 days. NeuroOne intends to continue to defend themselves vigorously. The Court issued multiple rulings on the Company's request for summary judgment and sanctions against PMT in April 2020. On April 29, 2020, the district court granted the Company's motion for sanctions. Additionally, the district court granted the Company's motion for summary judgment in part with respect to the counts for Christianson's breach of non-confidentiality agreement, Fredrickson's breach of confidentiality covenants, and the creation of a constructive trust and denied the Company's motion for summary judgment on all other counts. On August 24, 2020, defendants moved the Court to amend their counterclaims for abuse of process against PMT to add a claim for punitive damages. Trial has been set for May 2021, but this may be delayed or impacted by the COVID-19 pandemic. The Company intends to continue to defend itself vigorously and to continue to aggressively prosecute its affirmative counterclaim against PMT. Facility Lease On October 7, 2019, the Company entered into a non-cancellable lease agreement (the "Lease") with Biynah Cleveland, LLC, BIP Cleveland, LLC, and Edenvale Investors (together, the "Landlord") pursuant to which the Company has agreed to lease office space located at 7599 Anagram Drive, Eden Prairie, Minnesota (the "Premises"). The Company took possession of the Premises on November 1, 2019, with the term of the Lease ending 65 months after such date, unless terminated earlier (the "Term"). The initial base rent for the Premises is $6,410 per month for the first 17 months, increasing to $7,076 per month by the end of the Term. In addition, as long as the Company is not in default under the Lease, the Company shall be entitled to an abatement of its base rent for the first 5 months. In addition, the Company will pay its pro rata share of the Landlord's annual operating expenses associated with the premises, calculated as set forth in the Lease of which the Company is entitled to an abatement of these operating expense for the first 3 months. Prior to the October 2019 Lease, the Company entered into a non-cancellable facility lease for its operations and headquarters for an eleven-month term beginning on December 1, 2018. The monthly rent under that lease was $4,763. During the year ended September 30, 2020 and 2019, rent expense associated with the facility leases amounted to $103,189 and $47,630, respectively. Supplemental cash flow information related to the operating lease was as follows: Year Ended September 30, Cash paid for amounts included in the measurement of lease liability: Operating cash flows from operating leases $ 38,462 Right-of -use assets obtained in exchange for lease obligations: Operating leases $ 335,119 Supplemental balance sheet information related to the operating lease was as follows: As of Right-of-use assets $ 282,211 Lease liability $ 312,176 Weighted average remaining lease term (years) 4.5 Weighted average discount rate 7.0 % Maturity of the lease liability was as follows: As of 2021 $ 77,884 2022 79,832 2023 81,827 2024 83,873 2025 42,454 Total lease payments 365,870 Less imputed interest (53,694 ) Total 312,176 Short-term portion (57,848 ) Long-term portion $ 254,328 |
Intangibles and Property and Eq
Intangibles and Property and Equipment | 12 Months Ended |
Sep. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangibles and Property and Equipment | NOTE 5 – Intangibles and Property and Equipment Intangibles Intangible assets rollforward is as follows: Useful Life Net Intangibles, December 31, 2018 12-13 years $ 200,081 Less: amortization (21,243 ) Net Intangibles, September 30, 2019 178,838 Less: amortization (22,315 ) Net Intangibles, September 30, 2020 $ 156,523 The Company anticipates amortization expense of approximately $21,000 per year for fiscal year 2021 through 2025 based upon the two current license agreements. Property and Equipment Property and equipment held for use by category are presented in the following table: As of 2020 2019 Equipment and furniture $ 195,756 $ 56,457 Software 1,895 1,895 Total property and equipment 197,651 58,352 Less accumulated depreciation (31,620 ) (6,326 ) Property and equipment, net $ 166,031 $ 52,026 Depreciation expense was $25,294 and $6,326 for the years ended September 30, 2020 and 2019, respectively. |
Accrued Expenses and Other Liab
Accrued Expenses and Other Liabilities | 12 Months Ended |
Sep. 30, 2020 | |
Payables and Accruals [Abstract] | |
Accrued Expenses | NOTE 6 - Accrued Expenses and Other Liabilities Accrued expenses consisted of the following at September 30, 2020 and 2019: As of 2020 2019 Legal services $ — $ 228,709 Accrued payroll 238,212 171,087 Operating lease liability, short term 57,848 — Accrued issuance costs 50,400 50,400 Other 166,302 167,525 Total $ 512,762 $ 617,721 The "other" category is primarily comprised of board fees. Paycheck Protection Program The CARES Act, signed into law in March 2020, established the Paycheck Protection Program ("PPP"). The PPP authorizes over $600 billion in forgivable loans to small businesses. Loan amounts are forgiven to the extent proceeds are used to cover documented payroll, mortgage interest, rent, and utility costs over a 24-week measurement period following loan funding. There can be no assurance that this PPP loan will be forgiven. Loans have a maturity of 2 years and an interest rate of 1%. Prepayments may be made without penalty. In April 2020, the Company received loan funding of $83,333 under the PPP and was recorded as a long-term liability. Interest in connection with the PPP was nominal during the year ended September 30, 2020. |
Zimmer Development Agreement
Zimmer Development Agreement | 12 Months Ended |
Sep. 30, 2020 | |
Zimmer Development Agreement [Abstract] | |
Zimmer Development Agreement | NOTE 7 – Zimmer Development Agreement On July 20, 2020, the Company entered into an exclusive development and distribution agreement (the "Development Agreement") with Zimmer, Inc. ("Zimmer"), pursuant to which the Company granted Zimmer exclusive global rights to distribute NeuroOne's strip and grid cortical electrodes (the "Strip/Grid Products") and electrode cable assembly products (the "Electrode Cable Assembly Products"). Additionally, the Company granted Zimmer the exclusive right and license to distribute certain depth electrodes developed by the Company ("SEEG Products", and together with the Strip/Grid Products and Electrode Cable Assembly Products, the "Products"). The parties have agreed to collaborate with respect to development activities under the Development Agreement through a joint development committee composed of an equal number of representatives of Zimmer and the Company. Under the terms of the Development Agreement, the Company will be responsible for all costs and expenses related to developing the Products, and Zimmer will be responsible for all costs and expenses related to the commercialization of the Products. In addition to the Development Agreement, Zimmer and the Company have entered into a Manufacturing and Supply Agreement (the "MS Agreement") and a supplier quality agreement (the "Quality Agreement") with respect to the manufacturing and supply of the Products. Except as otherwise provided in the Development Agreement, the Company will be responsible for performing all development activities, including non-clinical and clinical studies directed at obtaining regulatory approval of each Product. Zimmer has agreed to use commercially reasonable efforts to promote, market and sell each Product following the "Product Availability Date" (as defined in the Development Agreement) for such Product. Pursuant to the Development Agreement, Zimmer made an upfront initial exclusivity fee payment of $2.0 million to the Company, the announcement of which triggered the automatic conversion of the Company's 2020 Paulson Notes pursuant to their terms. See Note 8 - Convertible Promissory Notes and Warrant Agreements. In addition, the Company is to receive the following fee payments upon reaching certain milestones: Scenario 1 ● Design freeze for the SEEG Products by November 30, 2020 - $500,000 ● Acceptance of all Deliverables for SEEG Products under the Development Plan (as defined in the Development Agreement) by April 30, 2021 - $500,000 Scenario 2: ● Acceptance of all Deliverables for SEEG Products under the Development Plan other than the Modified Connector by April 30, 2021 - $500,000 ● Acceptance of all Deliverables for SEEG Products under the Development Plan, including the Modified Connector by September 30, 2021 - $500,000 For purposes of the Development Agreement, each of the foregoing events shall have occurred only if the Company has demonstrated the achievement of the event to Zimmer's reasonable satisfaction. Notwithstanding the foregoing, the events in Sections 6.1(c)(ii), (iii) and (iv) of the Development Agreement shall not be deemed to be met if FDA Approval for the SEEG Products is not received prior to the applicable deadline. In addition to the Initial Exclusivity Fee and Interim Fee Bonus, in order to maintain the exclusivity of the SEEG Distribution License, Zimmer must pay the SEEG Exclusivity Maintenance Fee to the Company, on or prior to the SEEG Exclusivity Confirmation Date, in immediately available funds as follows: ● if the Product Availability Date for the SEEG Products occurs on or before June 30, 2021, then $3,000,000, plus the amount of any Interim Fee Bonuses earned pursuant to Section 6.1(c), including any such Interim Fee Bonus earned after June 30, 2021 pursuant to Section 6.1(c)(iv) following the delivery of a Design Modification Notice; ● if the Product Availability Date for the SEEG Products occurs after June 30, 2021, but on or before September 30, 2021, then $3,000,000, plus if Zimmer timely issues a Design A-9 Modification Notice, any Interim Fee Bonus earned pursuant to Section 6.1(c)(iv); ● if the Product Availability Date for the SEEG Products occurs after September 30, 2021, but on or before December 31, 2021, then $2,500,000; and ● if the Product Availability Date for the SEEG Products occurs after December 31, 2021, then $1,500,000. Notwithstanding any other provision of the Development Agreement, if the Product Availability Date for the SEEG Products has not occurred on or before June 30, 2022, Zimmer shall have the right to terminate the SEEG Distribution License by delivering written notice to the Company to that effect and, upon delivery of such notice, Zimmer shall be relieved of all of its obligations hereunder with respect to SEEG Products, including any obligation to pay the SEEG Exclusivity Maintenance Fee or to purchase, market, distribute or sell any SEEG Products. The Initial Exclusivity Fee and the SEEG Exclusivity Maintenance Fee (including any Interim Fee Bonus(es) Fess), once paid, are non-refundable. Additionally, to maintain the exclusivity of its distribution license for the SEEG Products, Zimmer must pay an additional fee to the Company within 60 days following the Product Availability Date for the SEEG Products. The Development Agreement will expire on the tenth anniversary of the date of the first commercial sale of the last of the Products to achieve a first commercial sale, unless terminated earlier pursuant to its terms. Either party may terminate the Development Agreement (x) with written notice for the other party's material breach following a cure period or (y) if the other party becomes subject to certain insolvency proceedings. In addition, Zimmer may terminate the Development Agreement for any reason with 90 days' written notice, and the Company may terminate the Development Agreement if Zimmer acquires or directly or indirectly owns a controlling interest in certain competitors of the Company. At inception of the Zimmer Development Agreement through September 30, 2020, the Company had identified three performance obligations under the Zimmer Development Agreement and consisted of the following: (1) the Company obligation to grant Zimmer access to its intellectual property; and, (2) the Company's obligations to complete the development of both the SEEG and Strip/Grid Products. Accordingly, the Company recognized revenue in the amount of $1,926,566 for the fixed or determinable portion of the upfront payment received related to the license access granted to Zimmer and for the portion of the development of the Products completed. The Zimmer Development Agreement was accounted for under the provisions of ASC 606, Revenue from Contracts with Customers. A reconciliation of the closing balance of deferred revenue related to the Zimmer Development Agreement is as follows as of September 30, 2020: 2020 Deferred Revenue Balance as of beginning of period – September 30, 2019 $ — Upfront initial exclusivity payment 2,000,000 Revenue recognized (1,926,566 ) Balance as of end of period – September 30, 2020 $ 73,434 The remaining performance obligations reflected in deferred revenue as of September 30, 2020 is expected to be completed in the latter half of fiscal year 2021. |
Convertible Promissory Notes an
Convertible Promissory Notes and Warrant Agreements | 12 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Convertible Promissory Notes and Warrant Agreements | NOTE 8 - Convertible Promissory Notes and Warrant Agreements As of 2020 2019 Paulson convertible notes, principal $ 546,000 $ — Accrued interest 63,458 — Fair value adjustments 397,748 — $ 1,007,206 $ — Paulson Convertible Note Offerings Paulson 2019 Convertible Note Financing On November 1, 2019, the Company entered into a subscription agreement with certain accredited investors, pursuant to which the Company, in a private placement (the "2019 Paulson Private Placement"), agreed to issue and sell to the investors 13% convertible promissory notes (each, a "2019 Paulson Note" and collectively, the "2019 Paulson Notes") and warrants (each, a "2019 Paulson Warrant" and collectively, the "2019 Paulson Warrants") to purchase shares of the Company's common stock. The initial closing of the 2019 Paulson Private Placement was consummated on November 1, 2019, and, on that date and through December 3, 2019, the Company issued the 2019 Paulson Notes in an aggregate principal amount of $3,234,800 to the subscribers for gross proceeds equaling the principal amount. The 2019 Paulson Private Placement terminated on December 3, 2019. On April 24, 2020, the Company and holders of a majority in aggregate principal amount of the 2019 Paulson Notes entered into an amendment to the 2019 Paulson Notes (the "Second 2019 Paulson Notes Amendment") to, among other things: i. Extended the Maturity Date – ii. Revised Optional Conversion Terms – iii. Revise the Registration Date – The 2019 Paulson Notes bear interest at a fixed rate of 13% per annum and originally required the Company to repay the principal and accrued and unpaid interest thereon on November 1, 2020. Interest on principal amounted to $213,383 during the year ended September 30, 2020 and was recorded under the net valuation change of instruments measured at fair value in the statements of operations. The Second 2019 Paulson Notes Amendment was accounted for as a note extinguishment for accounting purposes given the substantive change in the optional redemption feature's conversion formula. The fair value change in the 2019 Paulson Notes associated with the extinguishment was recorded as a loss on notes extinguishment in the accompanying statements of operations in the amount of $2,017,847 during the year ended September 30, 2020. Lastly, in connection with the Second 2019 Paulson Notes Amendment, legal costs in the amount of $1,943 were incurred and recorded as a component of interest in the accompanying statements of operations. Prior to the Second 2019 Paulson Notes Amendment, the subscriber had the option to convert the outstanding principal and accrued and unpaid interest of such subscriber's 2019 Paulson Note (the "Outstanding Balance") into common stock in an amount equal to the Outstanding Balance divided by the ten day volume weighted average closing price ("VWAP") of the common stock prior to conversion at no discount. As referenced above, the Second 2019 Paulson Notes Amendment provides for the ten-day VWAP of the common stock under the optional conversion option to be discounted at 40%. In addition, if the Company raises more than $3,000,000 in an equity financing (the "2019 Qualified Financing") before the maturity date, each subscriber shall have the option to convert the Outstanding Balance into the securities issued by the Company in such 2019 Qualified Financing in an amount equal to (i) the Outstanding Balance divided by (ii) the lower of 0.6 multiplied by (A) the actual per share price of securities issued by the Company in the 2019 Qualified Financing or (B) the ten day VWAP of the common stock prior to the first closing of a 2019 Qualified Financing. If a change of control transaction occurs prior to a 2019 Qualified Financing or the maturity date, the 2019 Paulson Notes would become payable on demand as of the closing date of such transaction. Change of control means a merger or consolidation with another entity in which the Company's stockholders do not own more than 50% of the outstanding voting power of the surviving entity or the disposition of all or substantially all of the Company's assets. The Company elected to account for the 2019 Paulson Notes on a fair value basis under ASC 825 to comprehensively value and streamline the accounting for the embedded conversion options. The fair value of the 2019 Paulson Notes was significantly higher than the proceeds received as of each of the respective issuance dates given the significant redemption discount associated with the 2019 Qualified Financing provision. The excess of fair value over proceeds at issuance amounted to $1,831,940 and was recorded to interest expense in the statements of operations during the year ended September 30, 2020. Subsequent to issuance, the fair value change of the 2019 Paulson Notes amounted to a reduction of $1,221,480 during the year ended September 30, 2020 and was recorded under the net valuation change of instruments measured at fair value in the statements of operations. Each 2019 Paulson Warrant grants the holder the option to purchase the number of shares of common stock equal to (i) 0.5 multiplied by (ii) the principal amount of such subscriber's 2019 Paulson Notes divided by 1.87, with an exercise price per share equal to $1.87. As of the final closing on December 3, 2019, the Company issued 2019 Paulson Warrants exercisable for 864,913 shares of common stock in connection with all closings of the 2019 Paulson Private Placement. The 2019 Paulson Warrants are immediately exercisable and expire on November 1, 2022. The exercise price is subject to adjustment in the event of any stock dividends or splits, reverse stock split, recapitalization, reorganization or similar transaction, as described therein. The 2019 Paulson warrants were deemed to be a free-standing instrument and were accounted for as equity. Given that the fair value of the 2019 Paulson Notes exceeded the proceeds received at issuance, there was no value attributed to the 2019 Paulson Warrants in the financial statements. In connection with the 2019 Private Placement, Paulson Investment Company, LLC ("Paulson") received a cash commission equal to 12% of the gross proceeds from the sale of the 2019 Paulson Notes, and 10-year warrants to purchase an amount of Common Stock equal to 259,476 shares of common stock at an exercise price equal to $1.87 per share (the "Broker Warrants"). The issuance costs incurred during the year ended September 30, 2020 in connection with the 2019 Paulson Private Placement were $865,567. Issuance costs included cash commissions equal to $388,176 and legal and third-party fees in the amount of $57,756. In addition, issuance costs included the value of the Broker Warrants in the amount of $419,635. The issuance costs were recorded as a component of interest in the accompanying statements of operations. Between January 1, 2020 and September 30, 2020, certain holders of the 2019 Paulson Notes elected to convert outstanding principal and accrued and unpaid interest in the amount of $2,838,724 into 2,176,119 shares of common stock. Paulson 2020 Convertible Note Financing On April 30, 2020, the Company entered into a subscription agreement with certain accredited investors, pursuant to which the Company, in a private placement (the "2020 Paulson Private Placement"), agreed to issue and sell to the investors 13% convertible promissory notes (each, a "2020 Paulson Note" and collectively, the "2020 Paulson Notes") and warrants (each, a "2020 Paulson Warrant" and collectively, the "2020 Paulson Warrants") to purchase shares of the Company's common stock. Between May 1, 2020 and June 30, 2020, the Company issued 2020 Paulson Notes in an aggregate principal amount of $5,122,700 to the Subscribers. The 2020 Paulson Private Placement was terminated on June 30, 2020. Between May 4, 2020 and July 22, 2020, certain Subscribers elected to convert $3,590,353 of the outstanding principal and interest of such Subscribers' 2020 Paulson Notes into 4,012,334 shares of common stock. On July 23, 2020, the remaining $1,613,961 of the outstanding principal and interest of the 2020 Paulson Notes were automatically converted into 1,605,532 shares of Common Stock following the announcement of the strategic transaction with Zimmer. See Note 7 – Zimmer Development Agreement Prior to conversion, the 2020 Paulson Notes had a fixed rate of 13% per annum and required the Company to repay the principal and accrued and unpaid interest thereon on the earlier of December 31, 2020 or a change of control transaction. Interest on principal amounted to $81,613 during the year ended September 30, 2020 and was recorded under the net valuation change of instruments measured at fair value in the statements of operations. If the Company raised more than $5,000,000 in an equity financing before the maturity date (the "2020 Qualified Financing"), without any action on the part of the Subscribers, all of the outstanding principal and accrued and unpaid interest of the Notes (the "Outstanding Balance") would have converted into that number of shares of the securities issued by the Company in the closing on the date a 2020 Qualified Financing occurred equal to: (i) the Outstanding Balance divided by (ii) the lower of 0.6 multiplied by (A) the actual per share price of the securities issued by the Company in the closing on the date a 2020 Qualified Financing occurred and (B) the volume weighted average price of the common stock for ten (10) trading days immediately preceding the 2020 Qualified Financing. As was the case in July 2020, if the Company announced a transaction between the Company and any other company (or an affiliate of any such company) that was included in the S&P 500 Health Care Index as published from time to time by S&P Dow Jones Indices LLC that included an investment or upfront payments resulting in gross proceeds to the Company of at least $2,000,000 upon the execution of such transaction or definitive agreement, and provided for terms of collaboration, manufacturing, distribution, licensing or supply of the Company's products (a "Strategic Transaction") before the maturity date, without any action on the part of the subscribers, the Outstanding Balance would convert into that number of shares of common stock equal to: (i) the Outstanding Balance divided by (ii) the lower of 0.6 multiplied by (A) the VWAP of the common stock for the ten (10) trading days immediately preceding the first announcement of the Strategic Transaction or (B) closing price of the common stock on the day preceding the first announcement by the Company of a Strategic Transaction. At any time, prior to a Qualified Financing, Strategic Transaction or change of control transaction at the sole election of the holder of such 2020 Paulson Note, all or a portion of the Outstanding Balance could be converted into that number of shares of common stock equal to: (i) the Outstanding Balance elected by the holder to be converted divided by (ii) an amount equal to 0.6 multiplied by the volume weighted average price of the common stock for the ten (10) trading days immediately preceding the date of conversion. If a change of control transaction occurred prior to the conversion of the 2020 Paulson Notes or the maturity date, the 2020 Paulson Notes would have become payable on demand as of the closing date of such transaction. Change of control meant a merger or consolidation with another entity in which the Company's stockholders did not own more than 50% of the outstanding voting power of the surviving entity or the disposition of all or substantially all of the Company's assets. The Company elected to account for the 2020 Paulson Notes on a fair value basis under ASC 825 to comprehensively value and streamline the accounting for the embedded conversion options. The fair value of the 2020 Paulson Notes was significantly higher than the proceeds received as of each of the respective issuance dates given the significant redemption discount associated with the redemption provisions. The excess of fair value over proceeds at issuance amounted to $3,784,918 and was recorded to interest expense in the statements of operations during the year ended September 30, 2020. Subsequent to issuance, the fair value change of the 2020 Paulson Notes amounted to an increase of $416,951 during the year ended September 30, 2020 and was recorded under the net valuation change of instruments measured at fair value in the statements of operations. Each 2020 Paulson Warrant grants the holder the option to purchase the number of shares of common stock equal to (i) 0.5 multiplied by (ii) the principal amount of such subscriber's 2020 Paulson Notes divided by 1.87, with an exercise price per share equal to $1.87. The 2020 Paulson Warrants are immediately exercisable and expire on April 30, 2023. The exercise price is subject to adjustment in the event of any stock dividends or splits, reverse stock split, recapitalization, reorganization or similar transaction. The Company issued 2020 Paulson Warrants exercisable for 1,369,690 shares of common stock in connection with all closings of the 2020 Paulson Private Placement through June 30, 2020. The 2020 Paulson warrants were deemed to be a free-standing instrument and were accounted for as equity. Given that the fair value of the 2020 Paulson Notes exceeded the proceeds received at issuance, there was no value attributed to the 2020 Paulson Warrants in the financial statements. In connection with the 2020 Paulson Private Placement, Paulson received a cash commission equal to 12% of the gross proceeds from the sale of the 2020 Paulson Notes and received 7-year warrants to purchase an amount of common stock equal to 410,911 ("Broker Warrants"). The Broker Warrants have an exercise price equal to $1.87 per share. The issuance costs incurred during the year ended September 30, 2020 in connection with the 2020 Paulson Private Placement were $1,040,213. Issuance costs included cash commissions equal to $614,725 and legal and third-party fees in the amount of $148,451. In addition, issuance costs included the value of the Broker Warrants in the amount of $277,037. The issuance costs were recorded as a component of interest in the accompanying statements of operations. 2017 Convertible Notes From October 2017 to May 2018, the Company issued convertible notes (the "2017 Convertible Notes") in an aggregate principal amount of $1,540,000 that bear interest at a fixed rate of 8% per annum and warrants to purchase shares of the Company's capital stock (the "2017 Warrants"). On February 28, 2019, the 2017 Convertible Notes were converted into 839,179 shares of common stock and 839,179 common stock purchase warrants with an exercise term of approximately 4.8 years and an exercise price $3.00 per share. In addition, the previously issued 2017 Warrants became immediately exercisable for 839,179 shares of common stock. The conversion was accounted for as a debt extinguishment given the bifurcation of the embedded premium debt conversion feature. The fair value of the newly issued common shares and warrants associated with the 2017 Convertible Notes conversion relative to the carrying value of the debt and fair value of warrant liability and premium derivative liability on the conversion date was $553,447 and was recorded as a loss on note extinguishment in the accompanying statements of operations for the year September 30, 2019. During the year ended September 30, 2019, interest on the principal was $51,333 and interest related to amortization of discounts related to the bifurcation of premium derivative liability, separation of warrants, revaluation discounts and issuance costs amounted to $233,224. The fair value changes related to the underlying premium conversion derivative and warrant liability amounted to an expense of $129,763 during the year ended September 30, 2019. As noted above, the 2017 Convertible Notes were converted into shares of common stock and were not outstanding during the year ended September 30, 2020. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Sep. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | NOTE 9 - Stock-Based Compensation During the years ended September 30, 2019 and 2020, stock-based expense related to the stock options, restricted stock units and stock awards was included in general and administrative and research and development costs as follows in the accompanying statements of operations: 2020 2019 General and administrative $ 1,623,629 $ 357,318 Research and development 212,341 134,431 Total stock-based compensation expense $ 1,835,970 $ 491,749 The Company's 2016 and 2017 Equity Incentive Plans provide for the issuance of restricted shares and stock options to employees, directors, and consultants of the Company. The Company initially reserved 2,292,265 shares of common stock for issuance under the 2016 and 2017 Equity Incentive Plans on a combined basis. Evergreen provision Under the 2017 Plan, the shares reserved automatically increase on January 1st of each year, for a period of not more than ten years from the date the 2017 Plan is approved by the stockholders of the Company, commencing on January 1, 2019 and ending on (and including) January 1, 2027, to an amount equal to 13% of the fully-diluted shares outstanding as of December 31st of the preceding calendar year. Notwithstanding the foregoing, the Board may act prior to January 1st of a given year to provide that there will be no January 1st increase in the share reserve for such year or that the increase in the share reserve for such year will be a lesser number of shares of common stock than would otherwise occur pursuant to the preceding sentence. "Fully Diluted Shares" as of a date means an amount equal to the number of shares of common stock (i) outstanding and (ii) issuable upon exercise, conversion or settlement of outstanding awards under the 2017 Plan and any other outstanding options, warrants or other securities of the Company that are (directly or indirectly) convertible or exchangeable into or exercisable for shares of common stock, in each case as of the close of business of the Company on December 31 of the preceding calendar year. On January 1, 2020 and 2019, 1,286,791 and 498,848 shares were added to the 2017 Plan, respectively, as a result of the evergreen provision. Stock Options During the years ended September 30, 2020 and 2019, 1,004,175 and 675,667 stock options were granted to employees, directors and consultants at a weighted average exercise price of $2.06 and $2.32 per share, respectively. The stock options granted during the year ended September 30, 2020 and 2019 had a weighted average grant date fair value of $1.01 and $1.13 per share, respectively, with the vesting period ranging from being immediate to four years. The options expire ten years from the date of grant. The total expense for the years ended September 30, 2020 and 2019 to the stock options was $798,242 and $324,205, respectively. The following table summarizes the Company's stock option plan activity for the years ended September 30, 2020 and 2019 as follows: Number of Weighted Weighted- Aggregate Outstanding at September 30, 2018 368,216 $ 0.07 8.6 $ 820,862 Granted 675,667 $ 2.32 — Exercised (198,043 ) $ 0.27 — Forfeited/Cancelled — $ — — Outstanding at September 30, 2019 845,840 $ 1.82 9.0 $ 343,406 Granted 1,004,175 $ 2.06 — Exercised (76,545 ) $ 0.04 — Forfeited/Cancelled (294,985 ) $ 1.97 — Outstanding at September 30, 2020 1,478,485 $ 2.04 8.8 $ 96,088 Vested and exercisable at September 30, 2020 761,998 $ 1.99 8.6 $ 96,088 (1) The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the estimated fair value of our common stock as of September 30, 2020 and 2019 of $1.29 and $1.87 per share, respectively. As of September 30, 2020, 1,401,940 and 685,453 outstanding and vested options, respectively, have no intrinsic value. The weighted-average assumptions used in the Black-Scholes option-pricing model are as follows for the stock options granted during the years ended September 30, 2020 and 2019: 2020 2019 Expected stock price volatility 53.1 % 50.4 % Expected life of options (years) 5.6 5.6 Expected dividend yield 0 % 0 % Risk free interest rate 1.4 % 2.4 % During the year ended September 30, 2020, 594,536 stock options vested having a weighted average grant date fair value per option of $1.02. During the year ended September 30, 2019, 288,138 stock options vested having a weighted average grant date fair value per option of $1.11. During the years ended September 30, 2020 and 2019, 294,985 and zero options were forfeited, respectively. Restricted Stock Units During the year ended September 30, 2020 and 2019, 234,964 and 42,018 restricted stock units ("RSUs") were granted to members of its board of directors and consultants that vest over a period ranging from immediate to two years, with a grant date fair value of $2.09 and $2.38 per unit, respectively. During the years ended September 30, 2020 and 2019, 179,378 and 10,503 RSUs vested, respectively. The total expense for the years ended September 30, 2020 and 2019 to the RSU's was $396,012 and $25,001, respectively. The number of RSUs forfeited during the year ended September 30, 2020 and 2019 was 7,003 and zero, respectively. Other Stock-Based Awards 2020 Activity In October 2019, two consulting agreements were executed whereby up to 115,000 shares of common stock were issued as of September 30, 2020 of which 115,000 shares of common stock were vested as of September 30, 2020 under these agreements. On April 22, 2020, the Company entered into an amendment (the "Amendment") to one of the consulting agreements. Pursuant to the Amendment, the Company issued an additional 35,000 shares in exchange for consulting services of which 35,000 shares of common stock were vested as of September 30, 2020 under the Amendment. Vesting was based on a time-based vesting condition ranging over a three to nine-month period commencing upon the execution of the consulting agreements. In February 2020, an additional consulting agreement was executed whereby up to 90,000 shares of common stock were issuable of which 90,000 shares of common stock were issued and vested as of September 30, 2020 under this agreement. In addition, on May 21, 2020, 66,583 shares of common stock were issued as compensation to a former 2019 Paulson Note holder related to a prior 2019 Paulson Note conversion and release of liability. In August 2020, an additional consulting agreement was executed whereby 120,000 shares of common stock were issued, subject to Company repurchase. The stock award under the agreement vests over a six-month period. As of September 30, 2020, 20,000 shares vested under this agreement. Compensation expense related to the stock awards granted under the consulting agreements and to the former 2019 Paulson Note holder referenced above amounted to $641,716 for the year ended September 30, 2020 and was included in the total stock-based expense. The expense was based on the fair value of the underlying common stock at the point of vesting which ranged from $1.51 to $2.65 per share. 2019 Activity A total of 250,000 shares of common stock were reserved in February 2018 as a result of a consulting agreement for investor relations services executed in February 2018. Under the agreement, 50,000 shares of common stock were awarded during the year ended September 30, 2019 subject to time-based vesting conditions. The compensation expense related to the vested common shares was included in the total stock-based compensation expense referenced above which totaled $115,000 during the year ended September 30, 2019. The expense was based on the fair value of the underlying common stock at the point of vesting which, on a weighted average basis, was $2.30 per share during the year ended September 30, 2019. The underlying stock price used in the analysis was on a non-marketable basis and was according to the market approach, considering both the traded price and forward multiples from guideline public companies, using allocation and marketability-discount methodologies. As of November 2018, all shares under the February 2018 share reserve were issued from the Company's authorized but unissued shares, but were not eligible to be issued under the 2016 or 2017 Equity Incentive Plan reserves. In addition, the Company previously had formal obligations to issue future common stock options relating to several consulting agreements. A total of 38,874 stock options were granted in May 2019 related to those consulting agreements. The corresponding stock-based compensation expense related to the stock-based awards in the amount of $27,543 was included in research and development expense in the accompanying statements of operations. General As of September 30, 2020, 1,839,400 shares were available for future issuance on a combined basis under the 2016 and 2017 Equity Incentive Plans. Unrecognized stock-based compensation was $845,273 as of September 30, 2020. The unrecognized share-based expense is expected to be recognized over a weighted average period of 2.0 years. |
Stockholders' Deficit
Stockholders' Deficit | 12 Months Ended |
Sep. 30, 2020 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Deficit | NOTE 10 - Stockholders' Deficit 2020 Common Stock Offering On July 28, 2020, the Company entered into securities purchase agreements with an accredited investor in a private placement, pursuant to which the Company has issued and sold 75,000 shares to such investor, at $1.80 per share for gross proceeds amounting to $135,000. 2019 Common Stock Offering On October 23, 2019, the Company entered into Securities Purchase Agreements with certain accredited investors, pursuant to which the Company, in a private placement, has issued and sold 141,666 shares of the Company's common stock to the accredited investors at a price of $1.80 per share, for gross proceeds amounting to $255,000. The Company filed a registration statement with the SEC covering the resale of the shares of common stock sold in the private placement on August 11, 2020. 2019 Private Placement From December 28, 2018 through July 1, 2019, the Company entered into Subscription Agreements (each, a "2019 Purchase Agreement") with certain accredited investors (the "New Purchasers"), pursuant to which the Company, in a new private placement (the "2019 Unit Private Placement"), agreed to issue and sell Units (the "2019 Units"), each consisting of (i) 1 share of common stock and (ii) a warrant to purchase 1 share of common stock at an initial exercise price of $3.00 per share (the "2019 Warrants"), to the New Purchasers. The 2019 Warrants are exercisable beginning on the date of issuance and will expire on December 28, 2023, five years from the date of the first closing of the 2019 Unit Private Placement. The initial closing of the 2019 Unit Private Placement was consummated on December 28, 2018. The Company issued and sold an aggregate of 2,338,179 of the 2019 Units at $2.50 per Unit to the New Purchasers, for total gross proceeds to the Company of $5,845,448 before deducting offering expenses during the year ended September 30, 2019. In connection with the 2019 Unit Private Placement, the Company recorded issuance costs in the amount of $1,150,359. The 2019 Unit Private Placement was terminated on July 1, 2019. 2018 Private Placement From July 9, 2018 through November 30, 2018 (the final closing), the Company entered into subscription agreements (each, a "Purchase Agreement") with certain accredited investors (the "Purchasers"), pursuant to which the Company, in a private placement (the "2018 Private Placement"), agreed to issue and sell to the Purchasers units (each, a "2018 Unit"), each consisting of (i) 1 share (each, a "Share") of common stock and (ii) a warrant to purchase 1 share of common stock at an initial exercise price of $3.00 per share (the "2018 Warrants"). The 2018 Warrants are exercisable beginning on the date of issuance and will expire on July 9, 2023, five years from the date of the first closing. The 2018 Warrants were accounted for as free-standing equity instruments and classified as additional paid-in capital in the accompanying balance sheets based on their relative fair value to the underlying common shares issued. The initial closing of the 2018 Private Placement was consummated on July 9, 2018 and was terminated on December 12, 2018. As of the termination of the 2018 Private Placement on December 12, 2018, the Company had issued and sold an aggregate of 615,200 of the 2018 Units at a price of $2.50 per Unit to the Purchasers, for total gross proceeds to the Company of $1,538,000 before deducting offering expenses (170,000 of the 2018 Units were sold during the year ended September 30, 2019). In connection with the 2018 Private Placement, the Company recorded issuance costs in the amount of $191,387 ($18,320 recorded during the year ended September 30, 2019). Warrant Activity and Summary The following table summarizes warrant activity during the years ended September 30, 2020 and 2019: Warrants Exercise Weighted Weighted Outstanding and exercisable at September 30, 2018 2,927,572 $ 1.80 - 3.00 $ 1.98 3.39 Issued 4,569,322 $ 2.00 - 3.00 $ 2.87 — Exercised (231,296 ) $ 1.80 $ 1.80 — Forfeited — $ — $ — — Outstanding and exercisable at September 30, 2019 7,265,598 $ 1.80 - 3.00 $ 2.55 3.60 Issued 2,904,990 $ 1.87 $ 1.87 — Exercised — $ — $ — — Forfeited — $ — $ — — Outstanding and exercisable at September 30, 2020 10,170,588 $ 1.80 - 3.00 $ 2.35 2.89 The following table summarizes information about warrants outstanding at September 30, 2020: Exercise Price Number Outstanding Weighted Average Number Exercisable at $ 1.80 2,251,076 1.14 2,251,076 $ 1.87 2,904,990 3.63 2,904,990 $ 2.00 135,512 3.75 135,512 $ 2.50 839,179 3.41 839,179 $ 2.75 193,417 3.75 193,417 $ 3.00 3,846,414 3.18 3,846,414 Total 10,170,588 10,170,588 |
Income Taxes
Income Taxes | 12 Months Ended |
Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 11 - Income Taxes The effective tax rate for the Company for the year ended September 30, 2020 and 2019 was zero percent. A reconciliation of income tax computed at the statutory federal income tax rate to the provision (benefit) for income taxes included in the accompanying statements of operations for the Company is as follows: 2020 2019 Income tax benefit at federal statutory rate (21.0 )% (21.0 )% State income tax, net of federal benefit (7.7 ) (7.7 ) Warrant expense — 2.5 Disqualified interest and other 17.0 0.2 Research credits (1.3 ) (2.0 ) Stock-based compensation and other 0.2 (0.8 ) Valuation allowance 12.8 28.8 Effective tax rate — % — % Significant components of the Company's deferred tax assets and liabilities are summarized in the tables below as of September 30, 2020 and 2019: 2020 2019 Deferred tax assets: Federal and state operating loss carryforwards $ 4,936,384 $ 3,528,712 Acquired intangibles 22,635 16,221 Accruals and other 30,406 40,113 Research and development credit carryforwards 450,081 275,343 Stock-based compensation 255,068 90,819 Total deferred tax assets 5,694,574 3,951,208 Valuation allowance (5,694,574 ) (3,951,208 ) Net deferred tax assets $ — $ — As of September 30, 2020 and 2019, the Company had gross deferred tax assets of approximately $5,695,000 and 3,951,000, respectively. Realization of the deferred assets is primarily dependent upon future taxable income, if any, the amount and timing of which are uncertain. The Company has had significant pre-tax losses since its inception. The Company has not yet generated revenues from sales and faces significant challenges to becoming profitable. Accordingly, the net deferred tax assets have been fully offset by a valuation allowance of approximately $5,695,000 and $3,951,000 as of September 30, 2020 and 2019, respectively. The U.S. net deferred tax assets will continue to require a valuation allowance until the Company can demonstrate their realizability through sustained profitability or another source of income. As of September 30, 2020 and 2019, the Company's federal net operating loss carryforwards were approximately $17,175,000 and $12,277,000, respectively. The Company had federal research credit carryforwards as of September 30, 2020 and 2019 of approximately $272,000 and $166,000, respectively. The federal net operating loss incurred prior to January 1, 2018 and tax credit carryforwards will begin to expire in 2036 if not utilized. Federal net operating losses incurred after December 31, 2017 will not expire. As of September 30, 2020 and 2019, the Company had state net operating loss carryforwards of approximately $17,175,000 and $12,277,000, respectively. The Company had state research credit carryforwards of approximately $178,000 and $110,000 as of September 30, 2020 and 2019, respectively. The state net operating loss carryforwards will begin to expire in 2031, if not utilized, and the state research credit carryforwards will begin to expire in 2032 if not utilized. Utilization of the net operating loss carryforwards and credits may be subject to a substantial annual limitation due to the ownership change limitations provided by Section 382 of the Internal Revenue Code of 1986, as amended, and similar state provisions. Generally, in addition to certain entity reorganizations, the limitation applies when one or more "5-percent shareholders" increase their ownership, in the aggregate, by more than 50 percentage points over a 36-month testing period or beginning the day after the most recent ownership change, if shorter. The annual limitation may result in the expiration of net operating losses and credits before utilization. In accordance with ASC 740, Income Taxes In accordance with this guidance, the Company has adopted a policy under which, if required to be recognized in the future, interest related to the underpayment of income taxes will be classified as a component of interest expense and any related penalties will be classified in operating expenses in the statements of operations. The Company's corporate returns are subject to examination for the 2016, 2017, 2018 and 2019 tax years for federal and subject to examination for the 2016, 2017, 2018 and 2019 tax years in several state jurisdictions. |
Defined Contribution Plan
Defined Contribution Plan | 12 Months Ended |
Sep. 30, 2020 | |
Retirement Benefits [Abstract] | |
Defined Contribution Plan | NOTE 12 - Defined Contribution Plan The Company has a 401(k) defined contribution plan (the "401K Plan") for all employees over age 21. Employees can defer up to 100% of their compensation through payroll withholdings into the 401K Plan subject to federal law limits. The Company matches 100% of deferrals up to 3% of one's contributions. The Company's matching contributions to employee deferrals are discretionary. The Company may also make discretionary profit sharing contributions under the 401K Plan in the future, but it has not done so through September 30, 2020. Employee contributions and any employer matching contributions made to satisfy certain non-discrimination tests required by the Internal Revenue Code are 100% vested upon contribution. Discretionary employer matches to employee deferrals vest over a six year period beginning on the second anniversary of an employee's date of hire. Discretionary profit sharing contributions vest over a five year period beginning on the first anniversary of an employee's date of hire. The amount of matching contributions made during the year ended September 30, 2020 and 2019 was zero and a benefit reduction of $(4,359), respectively. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Sep. 30, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 13 - Subsequent Events Conversions of 2019 Paulson Notes Between October 1, 2020 and November 2, 2020, 2019 Paulson Notes with an aggregate of $557,992, were converted into 787,571 shares of Common Stock. On December 7, 2020, the Company received its first purchase order for commercial sale of its product from Zimmer Biomet. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying financial statements have been prepared in accordance with accounting standards generally accepted in the United States of America. |
Reclassifications | Reclassifications Certain amounts presented in the prior year period have been reclassified to conform to current period financial statement presentation. The change in accounts payable and accrued expenses reported in the statements of cash flows during the comparable prior year period was reclassified into two separate line item categories. |
Management's Use of Estimates | Management's Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, primarily in connection with the convertible promissory notes, and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates. |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to a concentration of credit risk consist of cash. The Company's cash is held by one financial institution in the United States. Amounts on deposit may at times exceed federally insured limits. The Company has not experienced any losses on its deposits since inception, and management believes that minimal credit risk exists with respect to these financial institutions. As of September 30, 2020, the Company had $3,786,397 of deposits in excess of federally insured amounts. |
Revenue Recognition | Revenue Recognition Beginning October 1, 2018, the Company has followed the provisions of ASC 606, Revenue from Contracts with Customers In determining the appropriate amount of revenue to be recognized as it fulfills its obligations under its agreements, the Company performs the following steps: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations based on estimated selling prices; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account in ASC Topic 606. Performance obligations may include license rights, development services, and services associated with regulatory submission and approval processes. Significant management judgment is required to determine the level of effort required under an arrangement and the period over which the Company expects to complete its performance obligations under the arrangement. If the Company cannot reasonably estimate when its performance obligations are either completed or become inconsequential, then revenue recognition is deferred until the Company can reasonably make such estimates. Revenue is then recognized over the remaining estimated period of performance using the cumulative catch-up method. As part of the accounting for these arrangements, the Company must develop assumptions that require judgment to determine the stand-alone selling price of each performance obligation identified in the contract. The Company uses key assumptions to determine the stand-alone selling price, which may include forecasted revenues, development timelines, reimbursement rates for personnel costs, discount rates and probabilities of technical and regulatory success. The Company allocates the total transaction price to each performance obligation based on the estimated relative standalone selling prices of the promised goods or service underlying each performance obligation. Licenses of intellectual property: If the license to the Company's intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, the Company recognizes revenues from non-refundable, up-front fees allocated to the license when the license is transferred to the customer, and the customer can use and benefit from the license. For licenses that are bundled with other promises, the Company utilizes judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue from non-refundable, up-front fees. The Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. Milestone payments: At the inception of each arrangement that includes milestone payments, the Company evaluates whether the milestones are considered probable of being achieved and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the value of the associated milestone (such as a regulatory submission) is included in the transaction price. Milestone payments that are not within the control of the Company, such as approvals from regulators, are not considered probable of being achieved until those approvals are received. When the Company's assessment of probability of achievement changes and variable consideration becomes probable, any additional estimated consideration is allocated to each performance obligation based on the estimated relative standalone selling prices of the promised goods or service underlying each performance obligation and recorded in license, collaboration, and other revenues based upon when the customer obtains control of each element. Royalties: For arrangements that include sales-based royalties, including milestone payments based on the level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (a) when the related sales occur, or (b) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). |
Common Stock Valuation | Common Stock Valuation The Company has been utilizing pricing as quoted on the OTC Market as the basis for the fair value of the Company’s common stock since September 30, 2019. Prior to September 30, 2019, the Company utilized methodologies in accordance with the framework of the American Institute of Certified Public Accountants’ Technical Practice Aid, Valuation of Privately-Held Company Equity Securities Issued as Compensation, to estimate the fair value of its common stock (the “AICPA Valuation Framework”). The valuation methodology included estimates and assumptions that required the Company’s judgment. These estimates and assumptions included a number of objective and subjective factors, including external market conditions affecting the biotechnology industry sector, and the likelihood of achieving a liquidity event, such as an offering or sale. Significant changes to the key assumptions used in the valuations would result in different fair values of common stock at each of those valuation dates. The fair value the Company’s common stock is used as an input into the fair value determination of instruments recorded at fair value and stock option or other equity awards that the Company has issued. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company’s accounting for fair value measurements of assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring or nonrecurring basis adheres to the Financial Accounting Standards Board (“FASB”) fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows: ● Level 1 Inputs: Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the Company at the measurement date. ● Level 2 Inputs: Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability. ● Level 3 Inputs: Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at the measurement date. As of September 30, 2020 and 2019, the fair values of cash, prepaid, other assets, accounts payable and accrued expenses approximated their carrying values because of the short-term nature of these assets or liabilities. The fair value of the convertible notes outstanding during the year ended September 30, 2020 were based on both the fair value of our common stock, discount associated with the embedded redemption features, and cash flow models discounted at current implied market rates evidenced in recent arms-length transactions representing expected returns by market participants for similar instruments and are based on Level 3 inputs. The estimated fair value of the convertible promissory notes of the Company that were outstanding during year ended September 30, 2019 were based on amortized cost which was deemed to approximate fair value. The fair value of the warrant liability and the premium conversion derivatives associated with the convertible promissory notes outstanding during fiscal 2019 were based on both the estimated fair value of our common stock and cash flow models discounted at the then current implied market rates evidenced in arms-length transactions representing expected returns by market participants for similar instruments during that period and were based on Level 3 inputs. There were no transfers between fair value hierarchy levels during the years ended September 30, 2020 and 2019. The fair value of financial instruments measured on a recurring basis is as follows: As of Description Total Level 1 Level 2 Level 3 Liabilities: Convertible Notes $ 1,007,206 — — $ 1,007,206 Total liabilities at fair value $ 1,007,206 — — $ 1,007,206 The following table provides a roll-forward of the convertible notes, warrant liability and premium debt conversion derivatives measured at fair value on a recurring basis using unobservable level 3 inputs for the years ended September 30 as follows: 2020 Convertible notes Balance as of beginning of period – September 30, 2019 $ — Fair value attributed to convertible promissory notes upon issuance 13,974,358 Fair value attributed to note extinguishment 2,017,847 Conversion of convertible promissory notes to common stock (14,180,470 ) Change in fair value including accrued interest (804,529 ) Balance as of end of period – September 30, 2020 $ 1,007,206 2019 Warrant liability Balance as of beginning of period – September 30, 2018 $ 817,155 Change in fair value of warrant liability 18,568 Reclassification to equity upon conversion of convertible promissory notes (835,723 ) Balance as of end of period – September 30, 2019 $ — 2019 Premium debt conversion derivatives Balance as of beginning of period – September 30, 2018 $ 308,395 Change in fair value of premium debt conversion derivatives 111,195 Reclassification to equity upon conversion of convertible promissory notes (419,590 ) Balance as of end of period – September 30, 2019 $ — |
Intellectual Property | Intellectual Property The Company has entered into two licensing agreements with major research institutions, which allows for access to certain patented technology and know-how. Payments under those agreements are capitalized and amortized to general and administrative expense over the expected useful life of the acquired technology. |
Property and Equipment | Property and Equipment Property and equipment is recorded at cost and reduced by accumulated depreciation. Depreciation expense is recognized over the estimated useful lives of the assets using the straight-line method. The estimated useful life for equipment and furniture ranges from three to seven years and three years for software. Tangible assets acquired for research and development activities and that have alternative use are capitalized over the useful life of the acquired asset. Estimated useful lives are periodically reviewed, and, when appropriate, changes are made prospectively. Software purchased for internal use consists primarily of amounts paid for perpetual licenses to third-party software providers and installation costs. When certain events or changes in operating conditions occur, asset lives may be adjusted and an impairment assessment may be performed on the recoverability of the carrying amounts. Maintenance and repairs are charged directly to expense as incurred. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company evaluates its long-lived assets, which consist of licensed intellectual property and property and equipment for impairment whenever events or changes in circumstances indicate that the carrying value of these assets may not be recoverable. The Company assesses the recoverability of long-lived assets by determining whether or not the carrying value of such assets will be recovered through undiscounted expected future cash flows. If the asset is considered to be impaired, the amount of any impairment is measured as the difference between the carrying value and the fair value of the impaired asset. |
Research and Development Costs | Research and Development Costs Research and development costs are charged to expense as incurred. Research and development expenses may include costs incurred in performing research and development activities, including clinical trial costs, manufacturing costs for both clinical and pre-clinical materials as well as other contracted services, license fees, and other external costs. Non-refundable advance payments for goods and services that will be used in future research and development activities are expensed when the activity is performed or when the goods have been received, rather than when payment is made, in accordance with Accounting Standards Codification (ASC) 730, Research and Development |
Warrant Liability | Warrant Liability The Company issued warrants to purchase equity securities in connection with the issuance or amendment of the convertible promissory notes. The Company accounts for these warrants as a liability at fair value when the number of shares is not fixed and determinable. Additionally, issuance costs associated with the warrant liability are expensed as incurred and reflected as interest expense in the accompanying statements of operations. The Company adjusts the liability for changes in fair value until the earlier of the exercise or expiration of the warrants for any period when pricing protections in future equity financings remain in place, or until such time, if any, as the number of shares to be exercised becomes fixed, at which point the warrants will be classified in stockholders’ equity (deficit) provided that there are sufficient authorized and unissued shares of common stock to settle the warrants and redeem any other contracts that may require settlement in shares of common stock. Any future change in fair value of the warrant liability, when outstanding, is recognized in the statements of operations. |
Premium Debt Conversion Derivatives | Premium Debt Conversion Derivatives The Company evaluates all conversion and redemption features contained in a debt instrument to determine if there are any embedded derivatives that require separation from the host debt instrument. An embedded derivative that requires separation is bifurcated from its host debt instrument and a corresponding discount to the host debt instrument is recorded. The discount is amortized and recorded to interest expense over the term of the host debt instrument using the straight-line method which approximates the effective interest method. The separated embedded derivative is accounted for separately on a fair market value basis. The Company records the fair value changes of a separated embedded derivative at each reporting period in the statements of operations based on the fair value of its common stock and cash flow models discounted at current implied market rates evidenced in recent arms-length transactions representing expected returns by market participants for similar instruments and are based on Level 3 inputs. |
Income Taxes | Income Taxes For the Company, income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax base and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Deferred tax assets are reduced by a valuation allowance if it is more likely than not that some portion or all of the deferred tax asset will not be realized. |
Net Loss Per Share | Net Loss Per Share For the Company, basic loss per share of common stock is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted earnings or loss per share of common stock is computed similarly to basic earnings or loss per share except the weighted average shares outstanding are increased to include additional shares from the assumed exercise of any common stock equivalents, if dilutive. The Company’s convertible promissory notes, warrants, stock options and restricted stock units while outstanding are considered common stock equivalents for this purpose. Diluted earnings is computed utilizing the treasury method for the warrants, stock options and restricted stock units. Diluted earnings with respect to the convertible promissory utilize the if-converted method. No incremental common stock equivalents were included in calculating diluted loss per share because such inclusion would be anti-dilutive given the net loss reported for the years ended September 30, 2020 and 2019. The following potential common shares were not considered in the computation of diluted net loss per share as their effect would have been anti-dilutive for the years ended September 30, 2020 and 2019: 2020 2019 Warrants 10,170,588 7,265,598 Stock options 1,478,485 845,840 Restricted stock units 88,478 31,515 Convertible notes 832,848 — |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In February 2016, the FASB issued Accounting Standards Update ("ASU") 2016-02, Leases (Topic 842) and subsequently amended the guidance relating largely to transition considerations under the standard in January 2017 and July 2018. The objective of this update is to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. This ASU is effective for fiscal years beginning after December 15, 2018, including interim periods within those annual periods. The Company adopted the new standard on October 1, 2019 and it did not have a material impact on the Company's balance sheet, statements of comprehensive loss or statements of cash flows as the Company did not have any material lease agreements in place as of the adoption date. As such, the Company did not restate comparative periods and did not recognize any cumulative adjustment to retained earnings on the date of the adoption. The Company elected the short-term lease expedient upon adoption of the standard. In July 2017, the FASB issued ASU No. 2017-11, Earnings Per Share, Distinguishing Liabilities from Equity and Derivatives and Hedging In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement . ● Removals: the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy; the policy for timing of transfers between levels; and the valuation processes for Level 3 fair value measurements. ● Modifications: for investments in certain entities that calculate net asset value, an entity is required to disclose the timing of liquidation of an investee's assets and the date when restrictions from redemption might lapse only if the investee has communicated the timing to the entity or announced the timing publicly; and the amendments clarify that the measurement uncertainty disclosure is to communicate information about the uncertainty in measurement as of the reporting date. ● Additions: the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period; and the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. This guidance is effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should all be applied prospectively for only the most recent interim or annual period presented in the initial year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. Early adoption is permitted. An entity is permitted to early adopt any removed or modified disclosures upon issuance of ASU 2018-13 and delay adoption of the additional disclosures until their effective date. The Company is currently evaluating the impact of the new guidance and does not expect that it will have a material impact on its financial statements. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740) which amends the existing guidance relating to the accounting for income taxes. This ASU is intended to simplify the accounting for income taxes by removing certain exceptions to the general principles of accounting for income taxes and to improve the consistent application of GAAP for other areas of accounting for income taxes by clarifying and amending existing guidance. The ASU is effective for fiscal years beginning after December 15, 2020. The Company does not expect that the adoption of this new guidance will have a material impact on the Company's financial statements In August 2020, FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity's Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity's Own Equity, which, among other things, provides guidance on how to account for contracts on an entity's own equity. This ASU eliminates the beneficial conversion and cash conversion accounting models for convertible instruments. It also amends the accounting for certain contracts in an entity's own equity that are currently accounted for as derivatives because of specific settlement provisions. In addition, this ASU modifies how particular convertible instruments and certain contracts that may be settled in cash or shares impact the diluted EPS computation. The amendments in this ASU are effective for smaller reporting companies as defined by the SEC for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020. The Company is currently evaluating the impact of ASU 2020-06 on its financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Schedule of fair value of financial instruments measured on a recurring basis | As of Description Total Level 1 Level 2 Level 3 Liabilities: Convertible Notes $ 1,007,206 — — $ 1,007,206 Total liabilities at fair value $ 1,007,206 — — $ 1,007,206 |
Schedule of convertible notes, warrant liability and premium debt conversion derivatives measured at fair value on a recurring basis | 2020 Convertible notes Balance as of beginning of period – September 30, 2019 $ — Fair value attributed to convertible promissory notes upon issuance 13,974,358 Fair value attributed to note extinguishment 2,017,847 Conversion of convertible promissory notes to common stock (14,180,470 ) Change in fair value including accrued interest (804,529 ) Balance as of end of period – September 30, 2020 $ 1,007,206 2019 Warrant liability Balance as of beginning of period – September 30, 2018 $ 817,155 Change in fair value of warrant liability 18,568 Reclassification to equity upon conversion of convertible promissory notes (835,723 ) Balance as of end of period – September 30, 2019 $ — 2019 Premium debt conversion derivatives Balance as of beginning of period – September 30, 2018 $ 308,395 Change in fair value of premium debt conversion derivatives 111,195 Reclassification to equity upon conversion of convertible promissory notes (419,590 ) Balance as of end of period – September 30, 2019 $ — |
Schedule of computation of diluted net loss per share | 2020 2019 Warrants 10,170,588 7,265,598 Stock options 1,478,485 845,840 Restricted stock units 88,478 31,515 Convertible notes 832,848 — |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Summary of supplemental cash flow information related to the operating lease | Year Ended September 30, Cash paid for amounts included in the measurement of lease liability: Operating cash flows from operating leases $ 38,462 Right-of -use assets obtained in exchange for lease obligations: Operating leases $ 335,119 |
Summary of Supplemental balance sheet information related to the operating lease | As of Right-of-use assets $ 282,211 Lease liability $ 312,176 Weighted average remaining lease term (years) 4.5 Weighted average discount rate 7.0 % |
Summary of Maturity of the lease liability | As of 2021 $ 77,884 2022 79,832 2023 81,827 2024 83,873 2025 42,454 Total lease payments 365,870 Less imputed interest (53,694 ) Total 312,176 Short-term portion (57,848 ) Long-term portion $ 254,328 |
Intangibles and Property and _2
Intangibles and Property and Equipment (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets | Useful Life Net Intangibles, December 31, 2018 12-13 years $ 200,081 Less: amortization (21,243 ) Net Intangibles, September 30, 2019 178,838 Less: amortization (22,315 ) Net Intangibles, September 30, 2020 $ 156,523 |
Schedule of property and equipment | As of 2020 2019 Equipment and furniture $ 195,756 $ 56,457 Software 1,895 1,895 Total property and equipment 197,651 58,352 Less accumulated depreciation (31,620 ) (6,326 ) Property and equipment, net $ 166,031 $ 52,026 |
Accrued Expenses and Other Li_2
Accrued Expenses and Other Liabilities (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Payables and Accruals [Abstract] | |
Schedule of accrued expenses | As of 2020 2019 Legal services $ — $ 228,709 Accrued payroll 238,212 171,087 Operating lease liability, short term 57,848 — Accrued issuance costs 50,400 50,400 Other 166,302 167,525 Total $ 512,762 $ 617,721 |
Zimmer Development Agreement (T
Zimmer Development Agreement (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Zimmer Development Agreement [Abstract] | |
Schedule of deferred revenue | 2020 Deferred Revenue Balance as of beginning of period – September 30, 2019 $ — Upfront initial exclusivity payment 2,000,000 Revenue recognized (1,926,566 ) Balance as of end of period – September 30, 2020 $ 73,434 |
Convertible Promissory Notes _2
Convertible Promissory Notes and Warrant Agreements (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of convertible promissory notes and warrant agreements | As of 2020 2019 Paulson convertible notes, principal $ 546,000 $ — Accrued interest 63,458 — Fair value adjustments 397,748 — $ 1,007,206 $ — |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of stock-based compensation expense | 2020 2019 General and administrative $ 1,623,629 $ 357,318 Research and development 212,341 134,431 Total stock-based compensation expense $ 1,835,970 $ 491,749 |
Schedule of stock option plan activity | Number of Weighted Weighted- Aggregate Outstanding at September 30, 2018 368,216 $ 0.07 8.6 $ 820,862 Granted 675,667 $ 2.32 — Exercised (198,043 ) $ 0.27 — Forfeited/Cancelled — $ — — Outstanding at September 30, 2019 845,840 $ 1.82 9.0 $ 343,406 Granted 1,004,175 $ 2.06 — Exercised (76,545 ) $ 0.04 — Forfeited/Cancelled (294,985 ) $ 1.97 — Outstanding at September 30, 2020 1,478,485 $ 2.04 8.8 $ 96,088 Vested and exercisable at September 30, 2020 761,998 $ 1.99 8.6 $ 96,088 (1) The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the estimated fair value of our common stock as of September 30, 2020 and 2019 of $1.29 and $1.87 per share, respectively. As of September 30, 2020, 1,401,940 and 685,453 outstanding and vested options, respectively, have no intrinsic value. |
Schedule of weighted-average assumptions used black-scholes option-pricing model | 2020 2019 Expected stock price volatility 53.1 % 50.4 % Expected life of options (years) 5.6 5.6 Expected dividend yield 0 % 0 % Risk free interest rate 1.4 % 2.4 % |
Stockholders' Deficit (Tables)
Stockholders' Deficit (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Stockholders' Equity Note [Abstract] | |
Schedule of warrant activity | Warrants Exercise Weighted Weighted Outstanding and exercisable at September 30, 2018 2,927,572 $ 1.80 - 3.00 $ 1.98 3.39 Issued 4,569,322 $ 2.00 - 3.00 $ 2.87 — Exercised (231,296 ) $ 1.80 $ 1.80 — Forfeited — $ — $ — — Outstanding and exercisable at September 30, 2019 7,265,598 $ 1.80 - 3.00 $ 2.55 3.60 Issued 2,904,990 $ 1.87 $ 1.87 — Exercised — $ — $ — — Forfeited — $ — $ — — Outstanding and exercisable at September 30, 2020 10,170,588 $ 1.80 - 3.00 $ 2.35 2.89 |
Schedule of warrants outstanding | Exercise Price Number Outstanding Weighted Average Number Exercisable at $ 1.80 2,251,076 1.14 2,251,076 $ 1.87 2,904,990 3.63 2,904,990 $ 2.00 135,512 3.75 135,512 $ 2.50 839,179 3.41 839,179 $ 2.75 193,417 3.75 193,417 $ 3.00 3,846,414 3.18 3,846,414 Total 10,170,588 10,170,588 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of reconciliation of income tax computed at the statutory federal income tax rate | 2020 2019 Income tax benefit at federal statutory rate (21.0 )% (21.0 )% State income tax, net of federal benefit (7.7 ) (7.7 ) Warrant expense — 2.5 Disqualified interest and other 17.0 0.2 Research credits (1.3 ) (2.0 ) Stock-based compensation and other 0.2 (0.8 ) Valuation allowance 12.8 28.8 Effective tax rate — % — % |
Schedule ofdeferred tax assets and liabilities | 2020 2019 Deferred tax assets: Federal and state operating loss carryforwards $ 4,936,384 $ 3,528,712 Acquired intangibles 22,635 16,221 Accruals and other 30,406 40,113 Research and development credit carryforwards 450,081 275,343 Stock-based compensation 255,068 90,819 Total deferred tax assets 5,694,574 3,951,208 Valuation allowance (5,694,574 ) (3,951,208 ) Net deferred tax assets $ — $ — |
Organization and Nature of Op_2
Organization and Nature of Operations (Details) | 1 Months Ended |
Apr. 30, 2020USD ($) | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Funding loan received | $ 83,333 |
Going Concern (Details)
Going Concern (Details) - USD ($) | Sep. 30, 2020 | Sep. 30, 2019 |
Going Concern (Textual) | ||
Accumulated deficit | $ 30,879,031 | $ 17,238,871 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) | Sep. 30, 2020USD ($) |
Liabilities: | |
Convertible Notes | $ 1,007,206 |
Total liabilities at fair value | 1,007,206 |
Level 1 [Member] | |
Liabilities: | |
Convertible Notes | |
Total liabilities at fair value | |
Level 2 [Member] | |
Liabilities: | |
Convertible Notes | |
Total liabilities at fair value | |
Level 3 [Member] | |
Liabilities: | |
Convertible Notes | 1,007,206 |
Total liabilities at fair value | $ 1,007,206 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details 1) - Convertible Notes [Member] | 12 Months Ended |
Sep. 30, 2020USD ($) | |
Convertible notes | |
Balance as of beginning of period - September 30, 2019 | |
Fair value attributed to convertible promissory notes upon issuance | 13,974,358 |
Fair value attributed to note extinguishment | 2,017,847 |
Conversion of convertible promissory notes to common stock | (14,180,470) |
Change in fair value including accrued interest | (804,529) |
Balance as of end of period - September 30, 2020 | $ 1,007,206 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Details 2) | 12 Months Ended |
Sep. 30, 2019USD ($) | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Reclassification to equity upon conversion of convertible promissory notes | $ 1,921,720 |
Warrant [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Balance as of beginning of period – September 30, 2018 | 817,155 |
Change in fair value of warrant liability | 18,568 |
Reclassification to equity upon conversion of convertible promissory notes | (835,723) |
Balance as of end of period - September 30, 2019 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies (Details 3) | 12 Months Ended |
Sep. 30, 2019USD ($) | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Reclassification to equity upon conversion of convertible promissory notes | $ 1,921,720 |
Premium debt conversion derivatives [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Balance as of beginning of period - September 30, 2018 | 308,395 |
Change in fair value of premium debt conversion derivatives | 111,195 |
Reclassification to equity upon conversion of convertible promissory notes | (419,590) |
Balance as of end of period - September 30, 2019 |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies (Details 4) - shares | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Warrants [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive computation of diluted net loss per share | 10,170,588 | 7,265,598 |
Stock options [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive computation of diluted net loss per share | 1,478,485 | 845,840 |
Restricted stock units [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive computation of diluted net loss per share | 88,478 | 31,515 |
Convertible Notes [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive computation of diluted net loss per share | 832,848 |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies (Details Textual) | 12 Months Ended |
Sep. 30, 2020USD ($)Agreements | |
Summary of Significant Accounting Policies (Textual) | |
Deposits in excess of federally insured amounts | $ | $ 3,786,397 |
Number of licencing agreements | Agreements | 2 |
Equipment [Member] | Minimum [Member] | |
Summary of Significant Accounting Policies (Textual) | |
Estimated useful life | 3 years |
Equipment [Member] | Maximum [Member] | |
Summary of Significant Accounting Policies (Textual) | |
Estimated useful life | 7 years |
Software [Member] | |
Summary of Significant Accounting Policies (Textual) | |
Estimated useful life | 3 years |
Commitments and Contingencies_2
Commitments and Contingencies (Details) | 12 Months Ended |
Sep. 30, 2020USD ($) | |
Cash paid for amounts included in the measurement of lease liability: | |
Operating cash flows from operating leases | $ 38,462 |
Right-of -use assets obtained in exchange for lease obligations: | |
Operating leases | $ 335,119 |
Commitments and Contingencies_3
Commitments and Contingencies (Details 1) - USD ($) | Sep. 30, 2020 | Sep. 30, 2019 |
Commitments and Contingencies Disclosure [Abstract] | ||
Right-of-use assets | $ 282,211 | |
Lease liability | $ 312,176 | |
Weighted average remaining lease term (years) | 4 years 6 months | |
Weighted average discount rate | 7.00% |
Commitments and Contingencies_4
Commitments and Contingencies (Details 2) | Sep. 30, 2020USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2021 | $ 77,884 |
2022 | 79,832 |
2023 | 81,827 |
2024 | 83,873 |
2025 | 42,454 |
Total lease payments | 365,870 |
Less imputed interest | (53,694) |
Total | 312,176 |
Short-term portion | (57,848) |
Long-term portion | $ 254,328 |
Commitments and Contingencies_5
Commitments and Contingencies (Details Textual) - USD ($) | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Nov. 01, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Royalty payments - 2020 | $ 50,000 | ||
Royalty payments - 2021 | 100,000 | ||
Royalty payments - 2022 | 150,000 | ||
Facility lease term | 65 months | ||
Monthly lease rent | $ 4,763 | ||
Lease rent expense,description | Prior to the October 2019 Lease, the Company entered into a non-cancellable facility lease for its operations and headquarters for an eleven-month term beginning on December 1, 2018. The monthly rent under that lease was $4,763. | ||
Facility lease agreement, description | On October 7, 2019, the Company entered into a non-cancellable lease agreement (the “Lease”) with Biynah Cleveland, LLC, BIP Cleveland, LLC, and Edenvale Investors (together, the “Landlord”) pursuant to which the Company has agreed to lease office space located at 7599 Anagram Drive, Eden Prairie, Minnesota (the “Premises”). The Company took possession of the Premises on November 1, 2019, with the term of the Lease ending 65 months after such date, unless terminated earlier (the “Term”). The initial base rent for the Premises is $6,410 per month for the first 17 months, increasing to $7,076 per month by the end of the Term. In addition, as long as the Company is not in default under the Lease, the Company shall be entitled to an abatement of its base rent for the first 5 months. In addition, the Company will pay its pro rata share of the Landlord’s annual operating expenses associated with the premises, calculated as set forth in the Lease of which the Company is entitled to an abatement of these operating expense for the first 3 months. | ||
Rent expense | $ 103,189 | $ 47,630 |
Intangibles and Property and _3
Intangibles and Property and Equipment (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Finite-Lived Intangible Assets [Line Items] | ||
Beginning Balance | $ 178,838 | $ 200,081 |
Less: amortization | (22,315) | (21,243) |
Ending Balance | $ 156,523 | $ 178,838 |
Minimum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 12 years | |
Maximum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 13 years |
Intangibles and Property and _4
Intangibles and Property and Equipment (Details 1) - USD ($) | Sep. 30, 2020 | Sep. 30, 2019 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Equipment and furniture | $ 195,756 | $ 56,457 |
Software | 1,895 | 1,895 |
Total property and equipment | 197,651 | 58,352 |
Less accumulated depreciation | (31,620) | (6,326) |
Property and equipment, net | $ 166,031 | $ 52,026 |
Intangibles and Property and _5
Intangibles and Property and Equipment (Details Textual) - USD ($) | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Intangibles and Property and Equipment (Textual) | ||
Depreciation expense | $ 25,294 | $ 6,326 |
Amortization expense for fiscal year 2021 | 21,000 | |
Amortization expense for fiscal year 2022 | 21,000 | |
Amortization expense for fiscal year 2023 | 21,000 | |
Amortization expense for fiscal year 2024 | 21,000 | |
Amortization expense for fiscal year 2025 | $ 21,000 |
Accrued Expenses and Other Li_3
Accrued Expenses and Other Liabilities (Details) - USD ($) | Sep. 30, 2020 | Sep. 30, 2019 |
Payables and Accruals [Abstract] | ||
Legal services | $ 228,709 | |
Accrued payroll | 238,212 | 171,087 |
Operating lease liability, short term | 57,848 | |
Accrued issuance costs | 50,400 | 50,400 |
Other | 166,302 | 167,525 |
Total | $ 512,762 | $ 617,721 |
Accrued Expenses and Other Li_4
Accrued Expenses and Other Liabilities (Details Textual) | 12 Months Ended |
Sep. 30, 2020 | |
Paycheck Protection Program [Member] | |
Paycheck protection program, description | The PPP authorizes over $600 billion in forgivable loans to small businesses. Loan amounts are forgiven to the extent proceeds are used to cover documented payroll, mortgage interest, rent, and utility costs over a 24-week measurement period following loan funding. There can be no assurance that this PPP loan will be forgiven. Loans have a maturity of 2 years and an interest rate of 1%. Prepayments may be made without penalty. In April 2020, the Company received loan funding of approximately $83,333 under the PPP. Interest in connection with the PPP was nominal during the year ended September 30, 2020. |
Zimmer Development Agreement (D
Zimmer Development Agreement (Details) | 12 Months Ended |
Sep. 30, 2020USD ($) | |
Deferred Revenue | |
Balance as of beginning of period - September 30, 2019 | |
Upfront initial exclusivity payment | 2,000,000 |
Revenue recognized | (1,926,566) |
Balance as of end of period - September 30, 2020 | $ 73,434 |
Zimmer Development Agreement _2
Zimmer Development Agreement (Details Textual) | 12 Months Ended |
Sep. 30, 2020USD ($) | |
Zimmer Development Agreement (Textual) | |
Intial fee payment | $ 2,000,000 |
Revenue recognized | 1,926,566 |
Development Agreement [Member] | Scenario One [Member] | November 30, 2020 [Member] | |
Zimmer Development Agreement (Textual) | |
Future potential milestone payments to Neuroone | 500,000 |
Development Agreement [Member] | Scenario One [Member] | April 30, 2021 [Member] | |
Zimmer Development Agreement (Textual) | |
Future potential milestone payments to Neuroone | 500,000 |
Development Agreement [Member] | Scenario One [Member] | On or before June 30, 2021 [Member] | |
Zimmer Development Agreement (Textual) | |
Future potential milestone payments to Neuroone | 3,000,000 |
Development Agreement [Member] | Scenario Two [Member] | Modified Connector by April 30, 2021 [Member] | |
Zimmer Development Agreement (Textual) | |
Future potential milestone payments to Neuroone | 500,000 |
Development Agreement [Member] | Scenario Two [Member] | Modified Connector by September 30, 2021 [Member] | |
Zimmer Development Agreement (Textual) | |
Future potential milestone payments to Neuroone | 500,000 |
Development Agreement [Member] | Scenario Two [Member] | After June 30, 2021, but on or before September 30, 2021 [Member] | |
Zimmer Development Agreement (Textual) | |
Future potential milestone payments to Neuroone | 3,000,000 |
Development Agreement [Member] | Scenario Two [Member] | After September 30, 2021, but on or before December 31, 2021 [Member] | |
Zimmer Development Agreement (Textual) | |
Future potential milestone payments to Neuroone | 2,500,000 |
Development Agreement [Member] | Scenario Two [Member] | After December 31, 2021 [Member] | |
Zimmer Development Agreement (Textual) | |
Future potential milestone payments to Neuroone | $ 1,500,000 |
Convertible Promissory Notes _3
Convertible Promissory Notes and Warrant Agreements (Details) - USD ($) | Sep. 30, 2020 | Sep. 30, 2019 |
Debt Disclosure [Abstract] | ||
Paulson convertible notes, principal | $ 546,000 | |
Accrued interest | 63,458 | |
Fair value adjustments | 397,748 | |
Total | $ 1,007,206 |
Convertible Promissory Notes _4
Convertible Promissory Notes and Warrant Agreements (Details Textual) - USD ($) | Dec. 03, 2019 | Jul. 23, 2020 | Jul. 22, 2020 | Apr. 24, 2020 | Feb. 28, 2019 | Jun. 30, 2020 | Jul. 22, 2020 | Jun. 30, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | Apr. 30, 2020 | Nov. 01, 2019 | May 31, 2018 | Oct. 31, 2017 |
Convertible Promissory Notes and Warrant Agreements (Textual) | ||||||||||||||||
Loss on notes extinguishment | $ (2,017,847) | $ (553,447) | ||||||||||||||
Net valuation change of instruments measured at fair value | 804,529 | $ (129,763) | ||||||||||||||
Paulson Private Placement [Member] | ||||||||||||||||
Convertible Promissory Notes and Warrant Agreements (Textual) | ||||||||||||||||
Principal and interest converted | 81,613 | |||||||||||||||
Issuance cost | 419,635 | |||||||||||||||
Issuance cost include cash commission | 388,176 | |||||||||||||||
Legal and third party fee | $ 57,756 | |||||||||||||||
Paulson Private Placement [Member] | Common Stock [Member] | ||||||||||||||||
Convertible Promissory Notes and Warrant Agreements (Textual) | ||||||||||||||||
Principal and interest converted into common stock during the period | $ 2,838,724 | |||||||||||||||
Issuance of common stock | 2,176,119 | |||||||||||||||
Warrants to purchase of common stock shares | 259,476 | |||||||||||||||
Issuance cost | $ 865,567 | |||||||||||||||
2020 Paulson Notes [Member] | ||||||||||||||||
Convertible Promissory Notes and Warrant Agreements (Textual) | ||||||||||||||||
Gross proceeds of strategic transaction conversion | $ 2,000,000 | |||||||||||||||
Equity qualified financing, description | (i) the Outstanding Balance divided by (ii) the lower of 0.6 multiplied by (A) the VWAP of the common stock for the ten (10) trading days immediately preceding the first announcement of the Strategic Transaction or (B) closing price of the common stock on the day preceding the first announcement by the Company of a Strategic Transaction. | |||||||||||||||
Aggregate principal amount | $ 5,122,700 | |||||||||||||||
Paulson Convertible Note Offering [Member] | ||||||||||||||||
Convertible Promissory Notes and Warrant Agreements (Textual) | ||||||||||||||||
Convertible notes bear interest at fixed rate | 13.00% | 13.00% | 13.00% | |||||||||||||
Principal amount | $ 3,234,800 | |||||||||||||||
Extended maturity date, description | The Second 2019 Paulson Notes Amendment extended the maturity date of the 2019 Paulson Notes from May 1, 2020 to November 1, 2020 (in either case, unless a change of control transaction happens prior to such date). | |||||||||||||||
Revised optional conversion terms, description | (1) the Outstanding Balance as defined below of such subscriber's 2019 Paulson Note elected by the subscriber to be converted divided by (2) an amount equal to 0.6 multiplied by the volume weighted average price of the common stock for the ten (10) trading days immediately preceding the date of conversion. | |||||||||||||||
Gross proceeds of equity qualified financing | $ 5,000,000 | |||||||||||||||
Equity qualified financing, description | (i) the Outstanding Balance divided by (ii) the lower of 0.6 multiplied by (A) the actual per share price of the securities issued by the Company in the closing on the date a 2020 Qualified Financing occurred and (B) the volume weighted average price of the common stock for ten (10) trading days immediately preceding the 2020 Qualified Financing. | |||||||||||||||
Description of maximum voting power of surviving entity | Change of control means a merger or consolidation with another entity in which the Company's stockholders do not own more than 50% of the outstanding voting power of the surviving entity or the disposition of all or substantially all of the Company's assets. | |||||||||||||||
Warrants exercise price | $ 1.87 | $ 1.87 | ||||||||||||||
Warrants exercisable date of issuance and expire | Nov. 1, 2022 | |||||||||||||||
Interest expense related to excess of fair value over proceeds at issuance | $ 1,831,940 | |||||||||||||||
Warrant issuance in connection with execution note agreement | 864,913 | |||||||||||||||
Maturity date | May 1, 2020 | |||||||||||||||
Interest on principal amount | $ 213,383 | |||||||||||||||
Loss on notes extinguishment | $ 2,017,847 | |||||||||||||||
Conversion option discount percentage | 40.00% | 40.00% | ||||||||||||||
Warrants, description | (i) 0.5 multiplied by (ii) the principal amount of such subscriber’s 2019 Paulson Notes divided by 1.87, with an exercise price per share equal to $1.87. | |||||||||||||||
Paulson Convertible Note Offering [Member] | 2019 Qualified Financing [Member] | ||||||||||||||||
Convertible Promissory Notes and Warrant Agreements (Textual) | ||||||||||||||||
Gross proceeds of equity qualified financing | $ 3,000,000 | |||||||||||||||
Equity qualified financing, description | (i) the Outstanding Balance divided by (ii) the lower of 0.6 multiplied by (A) the actual per share price of securities issued by the Company in the 2019 Qualified Financing or (B) the ten day VWAP of the common stock prior to the first closing of a 2019 Qualified Financing. If a change of control transaction occurs prior to a 2019 Qualified Financing or the maturity date, the 2019 Paulson Notes would become payable on demand as of the closing date of such transaction. | |||||||||||||||
Description of maximum voting power of surviving entity | Change of control means a merger or consolidation with another entity in which the Company's stockholders do not own more than 50% of the outstanding voting power of the surviving entity or the disposition of all or substantially all of the Company's assets. | |||||||||||||||
Legal costs | $ 1,943 | |||||||||||||||
Net valuation change of instruments measured at fair value | $ 1,221,480 | |||||||||||||||
Warrants, description | (i) 0.5 multiplied by (ii) the principal amount of such subscriber’s 2019 Paulson Notes divided by 1.87, with an exercise price per share equal to $1.87. | |||||||||||||||
2019 Paulson Private Placement [Member] | ||||||||||||||||
Convertible Promissory Notes and Warrant Agreements (Textual) | ||||||||||||||||
Cash commission percentage rate on proceeds | 12.00% | 12.00% | ||||||||||||||
Warrants exercise price | $ 1.87 | $ 1.87 | ||||||||||||||
Warrant term | 10 years | 10 years | ||||||||||||||
2020 Paulson Private Placement [Member] | ||||||||||||||||
Convertible Promissory Notes and Warrant Agreements (Textual) | ||||||||||||||||
Convertible notes bear interest at fixed rate | 13.00% | |||||||||||||||
Cash commission percentage rate on proceeds | 12.00% | 12.00% | ||||||||||||||
Warrants exercise price | $ 1.87 | $ 1.87 | ||||||||||||||
Warrant term | 7 years | 7 years | ||||||||||||||
Principal and interest converted into common stock during the period | $ 1,605,532 | $ 3,590,353 | $ 1,870,352 | |||||||||||||
Issuance of common stock | 4,012,334 | 2,034,343 | ||||||||||||||
Value of the broker warrants issued | $ 277,037 | |||||||||||||||
Issued new warrants exercisable common stock | 410,911 | |||||||||||||||
Issuance cost include cash commission | $ 1,040,213 | $ 614,725 | ||||||||||||||
Legal and third party fee | $ 148,451 | |||||||||||||||
2020 Paulson Warrant [Member] | ||||||||||||||||
Convertible Promissory Notes and Warrant Agreements (Textual) | ||||||||||||||||
Warrants exercisable date of issuance and expire | Apr. 30, 2023 | |||||||||||||||
Warrant issuance in connection with execution note agreement | 1,369,690 | |||||||||||||||
Warrants, description | (i) 0.5 multiplied by (ii) the principal amount of such subscriber's 2020 Paulson Notes divided by 1.87, with an exercise price per share equal to $1.87. | |||||||||||||||
2017 Convertible Notes [Member] | ||||||||||||||||
Convertible Promissory Notes and Warrant Agreements (Textual) | ||||||||||||||||
Convertible notes bear interest at fixed rate | 8.00% | 8.00% | ||||||||||||||
Principal amount | $ 1,540,000 | $ 1,540,000 | ||||||||||||||
Convertible notes conversion price per common share | $ 3 | $ 3 | ||||||||||||||
Convertible promissory notes converted into common stock | 839,179 | |||||||||||||||
Shares of common stock issuable upon exercise of warrants | 839,179 | |||||||||||||||
Issued new warrants exercisable common stock | 839,179 | |||||||||||||||
Warrant exercise term | 4 years 9 months 18 days | |||||||||||||||
Loss on notes extinguishment | $ 553,447 | |||||||||||||||
Interest on principal amount | $ 51,333 | |||||||||||||||
Interest related to amortization of discounts related to bifurcation of premium derivative liability, separation of warrants, revaluation discounts and issuance costs amount | 233,224 | |||||||||||||||
Fair value changes related to underlying premium conversion derivative and warrant liability amounted to benefit | $ 129,763 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total share-based compensation | $ 1,835,970 | $ 491,749 |
General and administrative [Member] | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total share-based compensation | 1,623,629 | 357,318 |
Research and development [Member] | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total share-based compensation | $ 212,341 | $ 134,431 |
Stock-Based Compensation (Det_2
Stock-Based Compensation (Details 1) - Employee Stock Option [Member] - USD ($) | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | ||
Number of Options | |||
Outstanding at beginning | 845,840 | 368,216 | |
Granted | 1,004,175 | 675,667 | |
Exercised | (76,545) | (198,043) | |
Forfeited/Cancelled | (294,985) | ||
Outstanding at ending | 1,478,485 | 845,840 | |
Vested and exercisable at ending | 761,998 | ||
Weighted Average Exercise Price | |||
Outstanding at beginning | $ 1.82 | $ 0.07 | |
Granted | 2.06 | 2.32 | |
Exercised | 0.04 | 0.27 | |
Forfeited/Cancelled | 1.97 | ||
Outstanding at ending | 2.04 | $ 1.82 | |
Vested and exercisable at ending | $ 1.99 | ||
Weighted Average Remaining Contractual Term (years) | |||
Outstanding at beginning | 9 years | 8 years 7 months 6 days | |
Outstanding at ending | 8 years 9 months 18 days | 9 years | |
Vested and exercisable at ending | 8 years 7 months 6 days | ||
Aggregate Intrinsic Value | |||
Outstanding at beginning | [1] | $ 343,406 | $ 820,862 |
Outstanding at ending | [1] | 96,088 | $ 343,406 |
Vested and exercisable at ending | [1] | $ 96,088 | |
[1] | The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the estimated fair value of our common stock as of September 30, 2020 and 2019 of $1.29 and $1.87 per share, respectively. As of September 30, 2020, 1,401,940 and 685,453 outstanding and vested options, respectively, have no intrinsic value. |
Stock-Based Compensation (Det_3
Stock-Based Compensation (Details 2) - Stock Options [Member] | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Offsetting Assets [Line Items] | ||
Expected stock price volatility | 53.10% | 50.40% |
Expected life of options (years) | 5 years 7 months 6 days | 5 years 7 months 6 days |
Expected dividend yield | 0.00% | 0.00% |
Risk free interest rate | 1.40% | 2.40% |
Stock-Based Compensation (Det_4
Stock-Based Compensation (Details Textual) - USD ($) | 1 Months Ended | 12 Months Ended | |||||
May 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Aug. 31, 2020 | May 21, 2020 | Sep. 30, 2018 | Feb. 28, 2018 | |
Stock-Based Compensation (Textual) | |||||||
Fair value of common stock price per share | $ 1.01 | $ 1.13 | |||||
Stock options | $ 798,242 | $ 324,205 | |||||
Employee Stock Option [Member] | |||||||
Stock-Based Compensation (Textual) | |||||||
Stock options vested | 594,536 | 288,138 | |||||
Weighted average, stock options vested | $ 1.02 | $ 1.11 | |||||
Stock options forfeited | 294,985 | ||||||
Number of options, granted | 1,004,175 | 675,667 | |||||
Total number of stock options outstanding | 1,478,485 | 845,840 | 368,216 | ||||
Stock options weighted average exercise price for shares of common stock granted | $ 2.06 | $ 2.32 | |||||
Two consulting agreements [Member] | |||||||
Stock-Based Compensation (Textual) | |||||||
Common stock issued | 115,000 | 120,000 | |||||
Common stock vested | 115,000 | ||||||
Additional common shares | 35,000 | ||||||
Additional common stock vested | 35,000 | ||||||
Additional Consulting Agreement [Member] | |||||||
Stock-Based Compensation (Textual) | |||||||
Stock options vested | 20,000 | ||||||
Common stock issued | 90,000 | 66,583 | |||||
Common stock vested | 90,000 | ||||||
Consulting agreements [Member] | 2019 Paulson Note [Member] | |||||||
Stock-Based Compensation (Textual) | |||||||
Compensation expense related to the stock awards | $ 641,716 | ||||||
Consulting agreements [Member] | 2019 Paulson Note [Member] | Maximum [Member] | |||||||
Stock-Based Compensation (Textual) | |||||||
Fair value of the underlying common stock at the point of vesting | $ 1.51 | ||||||
Consulting agreements [Member] | 2019 Paulson Note [Member] | Minimum [Member] | |||||||
Stock-Based Compensation (Textual) | |||||||
Fair value of the underlying common stock at the point of vesting | 2.65 | ||||||
Board of Directors [Member] | |||||||
Stock-Based Compensation (Textual) | |||||||
Fair value of common stock price per share | $ 2.09 | $ 2.38 | |||||
Stock options vested | 179,378 | 10,503 | |||||
Compensation expense associated with restricted common stock | $ 396,012 | $ 25,001 | |||||
RSUs forfeited shares | 7,003 | 0 | |||||
Restricted stock units | 234,964 | 42,018 | |||||
Vesting period | 2 years | ||||||
2017 Equity Incentive Plan [Member] | |||||||
Stock-Based Compensation (Textual) | |||||||
Fair value of common stock price per share | $ 1.01 | ||||||
Compensation expense related to the stock awards | $ 630,887 | ||||||
Stock options vested | 475,182 | ||||||
Unrecognized stock-based compensation | $ 845,273 | ||||||
Unrecognized share-based expense is expected to be recognized over a weighted average period | 2 years | ||||||
Shares available for future grant issuance | 1,839,400 | ||||||
2016 and 2017 Equity Incentive Plans [Member] | |||||||
Stock-Based Compensation (Textual) | |||||||
Shares of common stock | 2,292,265 | ||||||
Stock Option [Member] | |||||||
Stock-Based Compensation (Textual) | |||||||
Fair value of common stock price per share | $ 1.29 | $ 1.87 | |||||
Stock options vested | 50,000 | ||||||
Stock-based services expense | $ 115,000 | ||||||
Number of options, granted | 38,874 | ||||||
Stock options weighted average exercise price for shares of common stock granted | $ 2.30 | ||||||
Research and development expense | $ 27,543 | ||||||
Stock Option [Member] | 2017 Equity Incentive Plan [Member] | |||||||
Stock-Based Compensation (Textual) | |||||||
Shares reserved, description | The shares reserved automatically increase on January 1st of each year, for a period of not more than ten years from the date the 2017 Plan is approved by the stockholders of the Company, commencing on January 1, 2019 and ending on (and including) January 1, 2027, to an amount equal to 13% of the fully-diluted shares outstanding as of December 31st of the preceding calendar year. Notwithstanding the foregoing, the Board may act prior to January 1st of a given year to provide that there will be no January 1st increase in the share reserve for such year or that the increase in the share reserve for such year will be a lesser number of shares of common stock than would otherwise occur pursuant to the preceding sentence. “Fully Diluted Shares” as of a date means an amount equal to the number of shares of common stock (i) outstanding and (ii) issuable upon exercise, conversion or settlement of outstanding awards under the 2017 Plan and any other outstanding options, warrants or other securities of the Company that are (directly or indirectly) convertible or exchangeable into or exercisable for shares of common stock, in each case as of the close of business of the Company on December 31 of the preceding calendar year. On January 1, 2020 and 2019, 1,286,791 and 498,848 shares were added to the 2017 Plan, respectively, as a result of the evergreen provision. | ||||||
Stock-Based Awards [Member] | |||||||
Stock-Based Compensation (Textual) | |||||||
Reserved shares of common stock for issuance | 250,000 |
Stockholders' Deficit (Details)
Stockholders' Deficit (Details) - Warrant [Member] - $ / shares | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Class of Warrant or Right [Line Items] | ||
Warrants, Outstanding and exercisable, Beginning | 7,265,598 | 2,927,572 |
Issued | 2,904,990 | 4,569,322 |
Exercised | (231,296) | |
Forfeited | ||
Warrants, Outstanding and exercisable, Ending | 10,170,588 | 7,265,598 |
Exercise Price Per Warrant, Issued | $ 1.87 | |
Exercise Price Per Warrant, Exercised | $ 1.80 | |
Exercise Price Per Warrant, Forfeited | ||
Weighted Average Exercise Price, Outstanding and exercisable, Beginning | 2.55 | 1.98 |
Weighted Average Exercise Price, Issued | 1.87 | 2.87 |
Weighted Average Exercise Price, Exercised | 1.80 | |
Weighted Average Exercise Price, Forfeited | ||
Weighted Average Exercise Price, Outstanding and exercisable, Ending | $ 2.35 | $ 2.55 |
Outstanding, Weighted Average Term (years), Beginning | 3 years 7 months 6 days | 3 years 4 months 20 days |
Outstanding, Weighted Average Term (years), Issued | 0 years | 0 years |
Outstanding, Weighted Average Term (years), Exercised | 0 years | 0 years |
Outstanding, Weighted Average Term (years), Forfeited | 0 years | 0 years |
Outstanding, Weighted Average Term (years), Ending | 2 years 10 months 21 days | 3 years 7 months 6 days |
Minimum [Member] | ||
Class of Warrant or Right [Line Items] | ||
Exercise Price Per Warrant, Outstanding and exercisable, Beginning | $ 1.80 | $ 1.80 |
Exercise Price Per Warrant, Issued | 2 | |
Exercise Price Per Warrant, Outstanding and exercisable, Ending | 1.80 | 1.80 |
Maximum [Member] | ||
Class of Warrant or Right [Line Items] | ||
Exercise Price Per Warrant, Outstanding and exercisable, Beginning | 3 | 3 |
Exercise Price Per Warrant, Issued | 3 | |
Exercise Price Per Warrant, Outstanding and exercisable, Ending | $ 3 | $ 3 |
Stockholders' Deficit (Details
Stockholders' Deficit (Details 1) | 12 Months Ended |
Sep. 30, 2020$ / sharesshares | |
Class of Warrant or Right [Line Items] | |
Outstanding, Number of Warrant Shares | 10,170,588 |
Outstanding, Number Exercisable | 10,170,588 |
Warrant [Member] | One Exercise Price [Member] | |
Class of Warrant or Right [Line Items] | |
Exercise Price | $ / shares | $ 1.80 |
Outstanding, Number of Warrant Shares | 2,251,076 |
Outstanding, Weighted Average Remaining Contractual life (Years) | 1 year 1 month 20 days |
Outstanding, Number Exercisable | 2,251,076 |
Warrant [Member] | Two Exercise Price [Member] | |
Class of Warrant or Right [Line Items] | |
Exercise Price | $ / shares | $ 1.87 |
Outstanding, Number of Warrant Shares | 2,904,990 |
Outstanding, Weighted Average Remaining Contractual life (Years) | 3 years 7 months 17 days |
Outstanding, Number Exercisable | 2,904,990 |
Warrant [Member] | Three Exercise Price [Member] | |
Class of Warrant or Right [Line Items] | |
Exercise Price | $ / shares | $ 2 |
Outstanding, Number of Warrant Shares | 135,512 |
Outstanding, Weighted Average Remaining Contractual life (Years) | 3 years 9 months |
Outstanding, Number Exercisable | 135,512 |
Warrant [Member] | Four Exercise Price [Member] | |
Class of Warrant or Right [Line Items] | |
Exercise Price | $ / shares | $ 2.50 |
Outstanding, Number of Warrant Shares | 839,179 |
Outstanding, Weighted Average Remaining Contractual life (Years) | 3 years 4 months 28 days |
Outstanding, Number Exercisable | 839,179 |
Warrant [Member] | Five Exercise Price [Member] | |
Class of Warrant or Right [Line Items] | |
Exercise Price | $ / shares | $ 2.75 |
Outstanding, Number of Warrant Shares | 193,417 |
Outstanding, Weighted Average Remaining Contractual life (Years) | 3 years 9 months |
Outstanding, Number Exercisable | 193,417 |
Warrant [Member] | Six Exercise Price [Member] | |
Class of Warrant or Right [Line Items] | |
Exercise Price | $ / shares | $ 3 |
Outstanding, Number of Warrant Shares | 3,846,414 |
Outstanding, Weighted Average Remaining Contractual life (Years) | 3 years 2 months 5 days |
Outstanding, Number Exercisable | 3,846,414 |
Stockholders' Deficit (Detail_2
Stockholders' Deficit (Details Textual) - USD ($) | Dec. 12, 2018 | Nov. 30, 2018 | Jul. 28, 2020 | Oct. 23, 2019 | Dec. 28, 2018 | Sep. 30, 2019 |
Warrant [Member] | ||||||
Stockholders' Deficit (Textual) | ||||||
Purchase price, per share | $ 1.80 | |||||
Gross proceeds from private placement | $ 255,000 | |||||
Private placement transaction, description | The SEC covering the resale of the shares of common stock sold in the private placement on August 11, 2020. | |||||
Shares issued under private placement | 141,666 | |||||
2018 Private Placement [Member] | ||||||
Stockholders' Deficit (Textual) | ||||||
Purchase agreement, description | (i) 1 share (each, a “Share”) of common stock and (ii) a warrant to purchase 1 share of common stock at an initial exercise price of $3.00 per share (the “2018 Warrants”). The 2018 Warrants are exercisable beginning on the date of issuance and will expire on July 9, 2023, five years from the date of the first closing. | |||||
Offering price, per share | $ 2.50 | |||||
Issuance costs related to private placement | $ 191,387 | $ 18,320 | ||||
Units sold under private placement | 170,000 | |||||
Gross proceeds from private placement | $ 1,538,000 | |||||
Shares issued under private placement | 615,200 | |||||
2019 Private Placement [Member] | ||||||
Stockholders' Deficit (Textual) | ||||||
Purchase agreement, description | (i) 1 share of common stock and (ii) a warrant to purchase 1 share of common stock at an initial exercise price of $3.00 per share (the “2019 Warrants”), to the New Purchasers. The 2019 Warrants are exercisable beginning on the date of issuance and will expire on December 28, 2023, five years from the date of the first closing of the 2019 Unit Private Placement. | |||||
Offering price, per share | $ 2.50 | |||||
Issuance costs related to private placement | $ 1,150,359 | |||||
Gross proceeds from private placement | $ 5,845,448 | |||||
Shares issued under private placement | 2,338,179 | |||||
2020 Common Stock Offering [Member] | ||||||
Stockholders' Deficit (Textual) | ||||||
Offering price, per share | $ 1.80 | |||||
Gross proceeds from private placement | $ 135,000 | |||||
Shares issued under private placement | 75,000 | |||||
2019 Common Stock Offering [Member] | ||||||
Stockholders' Deficit (Textual) | ||||||
Offering price, per share | $ 1.80 | |||||
Gross proceeds from private placement | $ 255,000 | |||||
Shares issued under private placement | 141,666 |
Income Taxes (Details)
Income Taxes (Details) | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Income Tax Disclosure [Abstract] | ||
Income tax benefit at federal statutory rate | (21.00%) | (21.00%) |
State income tax, net of federal benefit | (7.70%) | (7.70%) |
Warrant expense | 2.50% | |
Disqualified interest and other | 17.00% | 0.20% |
Research credits | (1.30%) | (2.00%) |
Stock-based compensation and other | 0.20% | (0.80%) |
Valuation allowance | 12.80% | 28.80% |
Effective tax rate |
Income Taxes (Details 1)
Income Taxes (Details 1) - USD ($) | Sep. 30, 2020 | Sep. 30, 2019 |
Deferred tax assets: | ||
Federal and state operating loss carryforwards | $ 4,936,384 | $ 3,528,712 |
Acquired intangibles | 22,635 | 16,221 |
Accruals and other | 30,406 | 40,113 |
Research and development credit carryforwards | 450,081 | 275,343 |
Stock-based compensation | 255,068 | 90,819 |
Total deferred tax assets | 5,694,574 | 3,951,208 |
Valuation allowance | (5,694,574) | (3,951,208) |
Net deferred tax assets |
Income Taxes (Details Textual)
Income Taxes (Details Textual) - USD ($) | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Income Tax Disclosure [Abstract] | ||
Effective tax rate | 0.00% | 0.00% |
Gross deferred tax assets | $ 5,695,000 | $ 3,951,000 |
Valuation allowance | 5,695,000 | 3,951,000 |
Federal net operating loss carryforwards | 17,175,000 | 12,277,000 |
Federal research credit carryforwards | 272,000 | 166,000 |
State net operating loss carryforwards | 17,175,000 | 12,277,000 |
State research credit carryforwards | $ 178,000 | $ 110,000 |
Income tax, description | The federal net operating loss incurred prior to January 1, 2018 and tax credit carryforwards will begin to expire in 2036 if not utilized. Federal net operating losses incurred after December 31, 2017 will not expire. | |
Operating loss carryforwards, description | The state net operating loss carryforwards will begin to expire in 2031, if not utilized, and the state research credit carryforwards will begin to expire in 2032 if not utilized. | |
Shareholders, percentage | 5.00% | |
Ownership, percentage | 50.00% |
Defined Contribution Plan (Deta
Defined Contribution Plan (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Defined Contribution Plan (Textual) | ||
Employees defer compensation, percentage | 100.00% | |
Employee deferrals contributions, description | The Company matches 100% of deferrals up to 3% of one’s contributions. The Company’s matching contributions to employee deferrals are discretionary. The Company may also make discretionary profit sharing contributions under the 401K Plan in the future, but it has not done so through September 30, 2020. | |
Employee contributions, vesting percentage | 100.00% | |
Employee deferrals, vesting term | 6 years | |
Discretionary profit sharing contributions, vesting term | 5 years | |
Contributions cost | $ 0 | $ (4,359) |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | 1 Months Ended | 12 Months Ended |
Nov. 02, 2020 | Sep. 30, 2019 | |
Subsequent Events (Textual) | ||
Aggregate value of notes converted into stock | $ 1,921,720 | |
2019 Paulson Notes [Member] | Subsequent Event [Member] | ||
Subsequent Events (Textual) | ||
Aggregate value of notes converted into stock | $ 557,992 | |
Conversion of convertible notes into common stock | 787,571 |