STOCKHOLDERS EQUITY

3 Months Ended

Dec. 31, 2021

STOCKHOLDERS EQUITY

C. STOCKHOLDERS' EQUITY

C.	STOCKHOLDERS’ EQUITY
	Proceeds from the Sale of Common Stock
	In December 2020, the Company sold 1,000,000shares of common stock at a public offering price of $14.65 per share and received aggregate proceeds of approximately $13.6 million.
	Equity Compensation
	Underlying share information for equity compensation plans as of December 31, 2021 is as follows:

Name of Plan	Total Shares Reserved Under Plans		Shares Reserved for Outstanding Options		Shares Issued		Remaining Options/Shares Under Plans
Incentive Stock Option Plans		138,400		76,829		N/A		213
Non-Qualified Stock Option Plans		11,787,200		11,204,380		N/A		172,592
Stock Bonus Plans		783,760		N/A		370,691		413,036
Stock Compensation Plans		634,000		N/A		153,195		462,395
Incentive Stock Bonus Plan		640,000		N/A		614,500		25,500

Underlying share information for equity compensation plans as of September 30, 2021 is as follows:

Name of Plan	Total Shares Reserved Under Plans		Shares Reserved for Outstanding Options		Shares Issued		Remaining Options/Shares Under Plans
Incentive Stock Option Plans		138,400		76,829		N/A		213
Non-Qualified Stock Option Plans		11,787,200		10,972,880		N/A		410,592
Stock Bonus Plans		783,760		N/A		363,086		420,641
Stock Compensation Plans		634,000		N/A		153,195		462,395
Incentive Stock Bonus Plan		640,000		N/A		614,500		25,500

Stock option activity:
	Three Months Ended December31,
	2021		2020
Options granted		251,000		7,500
Options exercised		6,500		5,300
Options forfeited		13,000		42,166
Options expired		-		55

During the quarter ended December 31, 2021, the Company granted 250,000performance-based stock options from the 2020 Non-Qualified Stock Option Plan to officers. Each option entitles the holder to purchase one share of the Company’s common stock at a price of $10.48per share, the fair value on the date of issuance. The stock options will vest 100% upon approval of the first marketing application for any pharmaceutical based upon the Company’s Multikine technology in any of the USA, Canada, UK, Germany, France, Italy, Spain, Japan, or Australia. None of the options will be exercisable before November 19, 2022. All options which have not vested as of November 18, 2031 will be canceled. On the grant date, the options were valued using a Monte Carlo Simulation approach. A Monte Carlo Simulation is a statistical technique that is used to model probabilistic systems and establish the probabilities for a variety of outcomes. However, because attainment of the performance condition cannot be considered probable, no compensation cost is recognized relating to these options as of December 31, 2021. Management will re-assess the probability of achieving the performance condition at each reporting date.

Stock-Based Compensation Expense
	Three months Ended December 31,
	2021		2020
Employees	$	3,262,296	$	3,296,309
Non-employees	$	218,318	$	248,660

Employee compensation expense includes the expense related to options and restricted stock that is expensed over the vesting periods. Non-employee expense includes the expense related to options and stock issued to consultants expensed over the period of the related service contracts.

Warrants and Non-Employee Options

The following chart represents the warrants and non-employee options outstanding at December 31, 2021:

Warrant/Options	Issue Date	Shares Issuable upon Exercise of Warrants/ Options		Exercise Price		Expiration Date	Reference
Series N	8/18/2008		85,339	$	3.00	8/18/2022	*
Series UU	6/11/2018		93,603	$	2.80	6/30/2022	*
Series X	1/13/2016		120,000	$	9.25	7/13/2022	*
Series Y	2/15/2016		26,000	$	12.00	8/15/2022	*
Series HH	2/23/2017		200	$	3.13	2/16/2022	*
Series AA	8/26/2016		100,000	$	13.75	2/22/2022	*
Series MM	6/22/2017		333,432	$	1.86	6/22/2022	*
Series NN	7/24/2017		205,587	$	2.52	7/24/2022	2
Series RR	10/30/2017		251,761	$	1.65	10/30/2022	*
Series SS	12/19/2017		200,000	$	2.09	12/18/2022	*
Series TT	2/5/2018		600	$	2.24	2/5/2023	*
Consultants	7/28/2017 - 11/18/2020		15,000	$2.18 $11.61		11/17/2022 - 7/27/2027	*

* No current period changes to these warrants

1.	Derivative Liabilities
	The table below presents the fair value of the warrant liabilities at the balance sheet dates:

	December 31, 2021		September 30, 2021
Series Z warrants	$	-	$	64,787
Series AA warrants		1,400		276,035
Series CC warrants		-		94,961
Series HH warrants		795		1,597
Total warrant liabilities	$	2,195	$	437,380

The table below presents the gains on the warrant liabilities for the three months ended December 31:

	2021		2020
Series W warrants	$	-	$	73,570
Series Z warrants		64,787		278,363
Series ZZ warrants		-		51,867
Series AA warrants		274,635		333,808
Series BB warrants		-		30,632
Series CC warrants		24,372		164,345
Series HH warrants		802		251
Net gain on warrant liabilities	$	364,596	$	932,836

The Company reviews all outstanding warrants in accordance with the requirements of ASC 815. This topic provides that an entity should use a two-step approach to evaluate whether an equity-linked financial instrument (or embedded feature) is indexed to its own stock, including evaluating the instrument’s contingent exercise and settlement provisions. The warrant agreements provide for adjustments to the exercise price for certain dilutive events. Under the provisions of ASC 815, the warrants are not considered indexed to the Company’s stock because future equity offerings or sales of the Company’s stock are not an input to the fair value of a “fixed-for-fixed” option on equity shares, and equity classification is therefore precluded.

	In accordance with ASC 815, derivative liabilities must be measured at fair value upon issuance and re-valued at the end of each reporting period through expiration. Any change in fair value between the respective reporting dates is recognized as a gain or loss.
	Changes in Warrant Liabilities
	During the three months ended December 31, 2021, 15,205 Series CC warrants were exercised at an exercise price of $5.00for gross proceeds of $76,000. During the three months ended December 31, 2020, 5,000 Series CC warrants were exercised at an exercise price of $5.00for gross proceeds of $25,000.
	On December 8, 2021, 640 Series CC warrants, with an exercise price of $5.00, expired. On November 23, 2021, 184,800 Series Z warrants, with an exercise price of $13.75, expired.
	On August 22, 2021, 16,000 Series BB warrants, with an exercise price of $13.75, expired. On October 28, 2020, 688,930 Series W warrants, with an exercise price of $16.75, expired.
2.	Equity Warrants
	Changes in Equity Warrants
	During the three months ended December 31, 2021, 4,500 Series NN warrants were exercised at an exercise price of $2.52 for gross proceeds of $11,340.
	During the three months ended December 31, 2020, 10,000 Series TT warrants were exercised at an exercise price of $2.24 for gross proceeds of $22,400.
	On December 7, 2020, the expiration date of the Series N warrants was extended six months from February 18, 2021 to August 18, 2021. The incremental cost of this extension was approximately $1,000, which was recorded as a deemed dividend in the financial statements for the three months ended December 31, 2020. The Series N warrants are held by the de Clara Trust, of which the Company’s CEO, Geert Kersten, is a beneficiary.
	On December 7, 2020, the expiration date of the Series X warrants was extended six months from January 13, 2021 to July 13, 2021. The incremental cost of this extension was approximately $85,000, which was recorded as a deemed dividend in the financial statements for the three months ended December 31, 2020. The Series X warrants are also held by the de Clara Trust.
	On December 7, 2020, the expiration date of the Series Y warrants, which were issued in connection with a financing, was extended six months from February 15, 2021 to August 15, 2021. The incremental cost of this extension was approximately $41,000 and was recorded as additional paid-in capital.
	On December 7, 2020, the expiration date of Series UU warrants was extended six months from December 31, 2020 to June 30, 2021. These warrants were previously issued as an inducement to convert notes payable into shares of common stock. The incremental cost of this extension was $192 and was recorded as interest expense for the three months ended December 31, 2020. The Series UU warrants are held by Geert Kersten, Patricia Prichep (current Officers of the Company) and the de Clara Trust.
3.	Options and Shares Issued to Consultants
	During the three months ended December 31, 2021 and 2020, the Company issued 18,020 and 15,044 shares of restricted common stock, respectively, to consultants for services. The weighted average grant date fair value of the shares issued to consultants was $9.93 and $12.45 per share, respectively, during the three months ended December 31, 2021 and 2020.
	During the three months ended December 31, 2020, the Company issued to a consultant 5,000 options to purchase common stock with an exercise price of $11.61. The options are exercisable beginning May 18, 2021 and expire on November 17, 2022. The options were expensed on a straight-line basis over the six month vesting period at a fair value of approximately $28,000 or $5.65 per option.

	As of December 31, 2021 and September 30, 2021, 15,000 options issued to consultants remained outstanding, all of which were issued from the Non-Qualified Stock Option plans. All 15,000 options are vested as of December 31, 2021.
	During the three months ended December 31, 2021 and 2020, the Company recorded total expense of approximately $218,000 and $249,000, respectively, relating to the share based compensation under these consulting agreements. At December 31, 2021 and September 30, 2021, approximately $234,000and $364,000, respectively, are included in prepaid expenses.
4.	Securities Purchase Agreement
	The Company entered into a Securities Purchase Agreement with Ergomed plc (Ergomed), one of the Company’s CROs responsible for managing the Company’s Phase 3 clinical trial, to facilitate payment of amounts due to Ergomed. Under the Agreement, the Company issued Ergomed shares of common stock and the net proceeds from Ergomed's sales of those shares would reduce outstanding amounts due to Ergomed. Upon issuance, the Company expensed the full value of the shares as other non-operating gain/loss and subsequently offset the gain/loss as amounts were realized through the sale by Ergomed and reduced accounts payable to Ergomed.
	No sales were made by Ergomed during the three months ended December 31, 2021. As of December 31, 2021, Ergomed had no shares for resale. During the three months ended December 31, 2020, the Company realized approximately $0.1 million through the sale by Ergomed of 9,000 shares of the Company’s common stock and the Company reduced the payables to Ergomed and credited Other Operating Gain by that amount. No shares were issued to Ergomed during the three months ended December 31, 2021 and 2020.