Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Jan. 15, 2024 | Mar. 31, 2023 | |
Document and Entity Information | ||||
Document Type | 10-K | |||
Document Annual Report | true | |||
Document Transition Report | false | |||
Document Period End Date | Sep. 30, 2023 | |||
Entity File Number | 001-34887 | |||
Entity Registrant Name | MULLEN AUTOMOTIVE INC. | |||
Entity Incorporation, State or Country Code | DE | |||
Entity Tax Identification Number | 86-3289406 | |||
Entity Address, Address Line One | 1405 Pioneer Street | |||
Entity Address, City or Town | Brea | |||
Entity Address State Or Province | CA | |||
Entity Address, Postal Zip Code | 92821 | |||
City Area Code | 714 | |||
Local Phone Number | 613-1900 | |||
Title of 12(b) Security | Common Stock, par value $0.001 | |||
Trading Symbol | MULN | |||
Security Exchange Name | NASDAQ | |||
Entity Well-known Seasoned Issuer | No | |||
Entity Voluntary Filers | No | |||
Entity Current Reporting Status | Yes | |||
Entity Interactive Data Current | Yes | |||
Entity Filer Category | Non-accelerated Filer | |||
Entity Small Business | true | |||
Entity Emerging Growth Company | false | |||
Entity Shell Company | false | |||
Entity Public Float | $ 360.2 | |||
Entity Common Stock, Shares Outstanding | 5,884,693 | |||
Entity Central Index Key | 0001499961 | |||
Current Fiscal Year End Date | --09-30 | |||
Document Fiscal Year Focus | 2023 | |||
Document Fiscal Period Focus | FY | |||
Amendment Flag | false | |||
ICFR Auditor Attestation Flag | false | |||
Document Financial Statement Error Correction [Flag] | true | |||
Document Financial Statement Restatement Recovery Analysis [Flag] | false | |||
Auditor Name | RBSM LLP | Daszkal Bolton LLP | ||
Auditor Firm ID | 587 | 229 | ||
Auditor Location | Larkspur, California | Fort Lauderdale, Florida |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 155,267,098 | $ 54,085,685 |
Restricted cash | 429,372 | 30,289,400 |
Accounts receivable | 671,750 | |
Inventory | 16,807,013 | |
Prepaid expenses and other current assets | 24,955,223 | 1,958,759 |
TOTAL CURRENT ASSETS | 198,130,456 | 86,333,844 |
Property, plant, and equipment, net | 82,032,785 | 14,803,716 |
Intangible assets, net | 104,235,249 | 93,947,018 |
Deposit on ELMS assets purchase | 5,500,000 | |
Related party receivable | $ 2,250,489 | $ 1,232,387 |
Financing Receivable, after Allowance for Credit Loss, Noncurrent, Related Party, Type [Extensible Enumeration] | Related Party | Related Party |
Right-of-use assets | $ 5,249,417 | $ 4,597,052 |
Goodwill, net | 28,846,832 | 92,834,832 |
Other non-current assets | 960,502 | 3,345,631 |
TOTAL ASSETS | 421,705,730 | 302,594,479 |
CURRENT LIABILITIES | ||
Accounts payable | 13,175,504 | 6,109,425 |
Accrued expenses and other current liabilities | 41,201,929 | 7,185,881 |
Dividends payable | 401,859 | 7,762,255 |
Derivative liabilities | 64,863,309 | 84,799,179 |
Liability to issue shares | 9,935,950 | 10,710,000 |
Lease liabilities, current portion | 2,134,494 | 1,428,474 |
Notes payable, current portion | 7,461,492 | 3,856,497 |
Refundable deposits | 429,372 | 289,000 |
Other current liabilities | 7,000 | 90,372 |
TOTAL CURRENT LIABILITIES | 139,610,909 | 122,231,083 |
Notes payable, net of current portion | 5,164,552 | |
Liability to issue shares, net of current portion | 1,827,889 | |
Lease liabilities, net of current portion | 3,566,922 | 3,359,354 |
Deferred tax liability | 3,891,900 | 14,882,782 |
TOTAL LIABILITIES | 148,897,620 | 145,637,771 |
Commitments and Contingencies (Note 19) | ||
STOCKHOLDERS' EQUITY | ||
Preferred Stock, Value | ||
Common stock; $0.001 par value; 5,000,000,000 and 1,750,000,000 shares authorized at September 30, 2023 and September 30, 2022, respectively; 2,871,707 and 37,043 shares issued and outstanding at September 30, 2023 and 2022 respectively (*) | 2,872 | 37 |
Additional paid-in capital (*) | 2,071,110,126 | 948,598,587 |
Accumulated deficit | (1,862,162,037) | (889,907,455) |
TOTAL STOCKHOLDERS' EQUITY ATTRIBUTABLE TO THE COMPANY'S STOCKHOLDERS | 208,952,537 | 58,696,890 |
Noncontrolling interest | 63,855,573 | 98,259,819 |
TOTAL STOCKHOLDERS' EQUITY | 272,808,110 | 156,956,709 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 421,705,730 | 302,594,479 |
Series D Preferred Stock | ||
CURRENT LIABILITIES | ||
Dividends payable | 400,000 | |
STOCKHOLDERS' EQUITY | ||
Preferred Stock, Value | 363 | 4,359 |
Series C Preferred Stock | ||
STOCKHOLDERS' EQUITY | ||
Preferred Stock, Value | 1,212 | 1,360 |
Series A Preferred Stock | ||
STOCKHOLDERS' EQUITY | ||
Preferred Stock, Value | $ 1 | $ 2 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
Preferred Stock, par value | $ 0.001 | $ 0.001 |
Preferred Stock, shares authorized | 500,000,000 | 500,000,000 |
Common Stock, par value | $ 0.001 | $ 0.001 |
Common Stock, shares authorized | 5,000,000,000 | 1,750,000,000 |
Common Stock, shares issued | 2,871,707 | 37,043 |
Common Stock, shares outstanding | 2,871,707 | 37,043 |
Series D Preferred Stock | ||
Preferred Stock, shares authorized | 437,500,001 | 437,500,001 |
Preferred Stock, shares issued | 363,097 | 4,359,652 |
Preferred Stock, shares outstanding | 363,097 | 4,359,652 |
Preferred Stock, preference in liquidation | $ 159,000 | $ 1,909,091 |
Series C Preferred Stock | ||
Preferred Stock, shares authorized | 40,000,000 | 40,000,000 |
Preferred Stock, shares issued | 1,211,757 | 1,360,321 |
Preferred Stock, shares outstanding | 1,211,757 | 1,360,321 |
Preferred Stock, preference in liquidation | $ 10,696,895 | $ 12,025,238 |
Series A Preferred Stock | ||
Preferred Stock, shares authorized | 200,000 | 200,000 |
Preferred Stock, shares issued | 648 | 1,924 |
Preferred Stock, shares outstanding | 648 | 1,924 |
Preferred Stock, preference in liquidation | $ 836 | $ 2,482 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Revenue | ||
Vehicle sales | $ 366,000 | |
Cost of sales | (273,882) | |
Gross margin | 92,118 | |
Operating expenses: | ||
General and administrative | 215,846,132 | $ 75,338,256 |
Research and development | 77,387,336 | 21,650,840 |
Impairment of goodwill | 63,988,000 | |
Impairment of property, plant, and equipment, and other non-current assets | 14,770,000 | |
Impairment of intangible assets | 5,873,000 | |
Loss from operations | (377,772,350) | (96,989,096) |
Other income (expense): | ||
Other financing costs - initial recognition of derivative liabilities | (506,238,038) | (484,421,258) |
Gain / (loss) on derivative liability revaluation | (116,256,212) | (122,803,715) |
Gain / (loss) extinguishment of debt, net | (6,246,089) | 33,413 |
Gain / (loss) on financing | (8,934,892) | |
Gain / (loss) on sale of fixed assets | 386,377 | (50,574) |
Gain / (loss) on lease termination | (125,000) | |
Interest expense | (4,993,140) | (26,949,081) |
Penalty for insufficient authorized shares | (3,495,000) | |
Other income (expense), net | 2,532,034 | (5,647,841) |
Net loss before income tax benefit | (1,017,647,310) | (740,323,152) |
Income tax benefit/ (provision) | 10,988,482 | (1,600) |
Net loss | (1,006,658,828) | (740,324,752) |
Net loss attributable to noncontrolling interest | (34,404,246) | (791,946) |
Net loss attributable to stockholders | (972,254,582) | (739,532,806) |
Waived/(Accrued) accumulated preferred dividends | 7,360,397 | (40,516,440) |
Net loss attributable to common stockholders after preferred dividends | $ (964,894,185) | $ (780,049,246) |
Net Loss per share, basic | $ (1,574.14) | $ (63,085.26) |
Net Loss per share, diluted | $ (1,574.14) | $ (63,083.67) |
Weighted average shares outstanding, basic | 612,964 | 12,365 |
Weighted average shares outstanding, diluted | 612,964 | 12,365 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) | Preferred Stock Series A Preferred Stock | Preferred Stock Series B Preferred Stock | Preferred Stock Series C Preferred Stock | Preferred Stock Series D Preferred Stock | Preferred Stock | Common Stock | Paid-in Capital | Accumulated Deficit | Non-controlling Interest | Total |
Balance, beginning at Sep. 30, 2021 | $ 100 | $ 5,568 | $ 5,668 | $ 0 | $ 88,657,334 | $ (150,374,649) | $ (61,711,647) | |||
Balance, beginning (in shares) at Sep. 30, 2021 | 100,363 | 5,567,319 | 5,667,682 | 313 | ||||||
Cashless Warrant exercise | $ 23 | 554,371,515 | 554,371,538 | |||||||
Cashless Warrant exercise (in shares) | 23,567 | |||||||||
Issuance of common stock to settle liability to issue | 1,034,812 | 1,034,812 | ||||||||
Issuance of common stock to settle liability to issue (in shares) | 6 | |||||||||
Dividends deemed and accrued on preferred stock | (40,516,440) | (40,516,440) | ||||||||
Issuance of common stock for conversion of debt | $ 1 | 18,138,099 | 18,138,100 | |||||||
Issuance of common stock for conversion of debt (in shares) | 778 | |||||||||
Issuance of common stock for conversion of preferred stock | $ (98) | $ (5,568) | $ (13,766) | $ (75,568) | $ (95,000) | $ 5 | 93,145 | |||
Issuance of common stock for conversion of preferred stock (in shares) | (98,439) | (5,567,319) | (13,766,058) | (75,567,273) | (94,999,089) | 4,655 | ||||
Beneficial conversion feature of convertible debt | 3,336,854 | 3,335,005 | ||||||||
Issuance of common stock for note receivable | $ 1 | (1) | ||||||||
Issuance of common stock for note receivable (in shares) | 637 | |||||||||
Issuance of common stock as payment of penalty to shareholder | 3,494,999 | 3,495,000 | ||||||||
Issuance of common stock as payment of penalty to shareholder (in shares) | 248 | |||||||||
Preferred shares issued for cash | $ 12,212 | $ 79,927 | $ 92,139 | 141,009,395 | 141,101,534 | |||||
Preferred shares issued for cash (in shares) | 12,212,450 | 79,926,925 | 92,139,375 | |||||||
Preferred shares issued in exchange for conversion of debt | $ 2,829 | $ 2,829 | 24,988,926 | 24,991,755 | ||||||
Preferred shares issued in exchange for conversion of debt (in shares) | 2,829,029 | 2,829,029 | ||||||||
Preferred shares issued to settle liability to issue | $ 85 | $ 85 | 704,915 | 705,000 | ||||||
Preferred shares issued to settle liability to issue (in shares) | 84,900 | 84,900 | ||||||||
Prefunded warrant issuance | 15,000,000 | 15,000,000 | ||||||||
Issuance of common stock for asset | 141,000 | 141,000 | ||||||||
Issuance of common stock for asset (in shares) | 5 | |||||||||
Issuance of common stock issued for cash | $ 3 | 42,335,078 | 42,335,080 | |||||||
Issuance of common stock issued for cash (in shares) | 2,920 | |||||||||
Shares issued for business acquisition | $ 3 | 41,577,644 | 41,577,647 | |||||||
Shares issued for business acquisition (in shares) | 2,827 | |||||||||
Stock based compensation | $ 1 | 43,739,691 | 43,739,692 | |||||||
Share-based compensation (in shares) | 1,087 | |||||||||
Warrant issuances | 10,491,621 | 10,491,621 | ||||||||
Noncontrolling interest from Bollinger Motors acquisition | $ 99,051,765 | 99,051,765 | ||||||||
Noncontrolling interest loss since Bollinger Motors acquisition | (791,946) | (791,946) | ||||||||
Net loss | (739,532,806) | (739,532,806) | ||||||||
Balance, ending at Sep. 30, 2022 | $ 2 | $ 1,360 | $ 4,359 | $ 5,721 | $ 37 | 948,598,587 | (889,907,455) | 98,259,819 | 156,956,709 | |
Balance, ending (in shares) at Sep. 30, 2022 | 1,924 | 1,360,321 | 4,359,652 | 5,721,897 | 37,043 | |||||
Cashless Warrant exercise | $ 2,455 | 627,740,779 | 627,743,234 | |||||||
Cashless Warrant exercise (in shares) | 2,455,348 | |||||||||
Issuance of common stock as payment of penalty to shareholder | $ 1 | 5,519,999 | 5,520,000 | |||||||
Issuance of common stock as payment of penalty to shareholder (in shares) | 1,022 | |||||||||
Stock based compensation | $ 127 | 75,894,355 | 75,894,482 | |||||||
Share-based compensation (in shares) | 127,128 | |||||||||
Issuance of preferred stock, common stock and prefunded warrants in lieu of preferred stock | $ 273,364 | $ 273,364 | $ 268 | 196,551,580 | 196,825,212 | |||||
Issuance of preferred stock, common stock and prefunded warrants in lieu of preferred stock (in shares) | 273,363,635 | 273,363,635 | 267,317 | |||||||
Issuance of common stock for conversion of convertible notes and interest | $ 24 | 153,222,213 | 153,222,237 | |||||||
Issuance of common stock for conversion of convertible notes and interest (in shares) | 23,576 | |||||||||
Issuance of common stock for conversion of preferred stock and dividends | $ (1) | $ (148) | $ (277,360) | $ (277,509) | $ 12 | 277,477 | (20) | |||
Issuance of common stock for conversion of preferred stock and dividends (in shares) | (1,276) | (148,564) | (277,360,190) | (277,510,030) | 12,138 | |||||
Shares issued to settle note payable | $ 3 | 13,736,400 | 13,736,403 | |||||||
Shares issued to settle note payable (in shares) | 2,758 | |||||||||
Preferred shares issued to officers | 25,000 | 25,000 | ||||||||
Preferred shares series AA refund | (25,000) | (25,000) | ||||||||
Preferred stock dividends waiver | 7,360,397 | 7,360,397 | ||||||||
Common stock purchased and retired | $ (57) | (5,610,543) | (5,610,600) | |||||||
Common stock purchased and retired (in shares) | (57,000) | |||||||||
Shares issued to avoid fractional shares on reverse stock split | $ 2 | (2) | 0 | |||||||
Shares issued to avoid fractional shares on reverse stock split (in shares) | 2,377 | |||||||||
Reclassification of derivatives to equity upon authorization of sufficient number of shares | 47,818,884 | 47,818,884 | ||||||||
Noncontrolling interest | (34,404,246) | (34,404,246) | ||||||||
Net loss | (972,254,582) | (972,254,582) | ||||||||
Balance, ending at Sep. 30, 2023 | $ 1 | $ 1,212 | $ 363 | $ 1,576 | $ 2,872 | $ 2,071,110,126 | $ (1,862,162,037) | $ 63,855,573 | $ 272,808,110 | |
Balance, ending (in shares) at Sep. 30, 2023 | 648 | 1,211,757 | 363,097 | 1,575,502 | 2,871,707 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Cash Flows from Operating Activities | ||
Net loss | $ (1,006,658,828) | $ (740,324,752) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 16,388,299 | 3,282,285 |
Stock-based compensation | 85,441,869 | 43,715,242 |
Deferred income taxes | (10,990,882) | 1,600 |
Revaluation of derivative liabilities | 116,256,212 | 122,803,715 |
Initial recognition of derivative liabilities | 513,052,038 | 484,421,258 |
Impairment of goodwill | 63,988,000 | |
Impairment of property, plant, and equipment, and other non-current assets | 14,770,000 | |
Impairment of intangible assets | 5,873,000 | |
Non-cash financing loss on over-exercise of warrants | 8,934,892 | |
Non-cash interest and other operating activities | 199,998 | 13,883,637 |
Amortization of debt discount | 662,047 | 19,595,915 |
Loss/(gain) on asset disposal | (386,377) | 50,574 |
Loss/(gain) on extinguishment of debt | 6,246,089 | 41,096 |
Changes in operating assets and liabilities: | ||
Prepaids and other current assets | (22,687,245) | 3,114,540 |
Inventories | (16,807,013) | |
Accounts payable | 7,784,136 | 1,192,113 |
Accrued expenses and other liabilities | 38,500,352 | (18,013,899) |
Right of use assets and lease liabilities | 261,222 | 441,066 |
Net cash used in operating activities | (179,172,191) | (65,795,610) |
Cash Flows from Investing Activities | ||
Purchase of equipment | (14,508,004) | (11,606,944) |
Purchase of intangible assets | (498,431) | (415,181) |
ELMS assets purchase | (92,916,874) | (5,500,000) |
Acquisition of Bollinger Motors, Inc, net of cash acquired | (29,631,984) | |
Net cash used in investing activities | (107,923,309) | (47,154,109) |
Cash Flows from Financing Activities | ||
Proceeds from issuance of convertible notes payable | 170,000,000 | 12,240,353 |
Payment of notes payable | (20,694,353) | (15,100,768) |
Proceeds from issuance of preferred stock, common stock and prefunded warrants in lieu of preferred stock | 196,999,970 | 142,873,667 |
Reimbursement for over issuance of shares | 17,721,868 | |
Payments to acquire treasury stock | (5,610,600) | |
Proceeds from issuance of common stock | 42,269,378 | |
Proceeds from issue of prefunded warrants | 15,000,000 | |
Net cash provided by financing activities | 358,416,885 | 197,282,630 |
Increase in cash | 71,321,385 | 84,332,911 |
Cash, cash equivalents and restricted cash (in amount of $30,289,400), beginning of period | 84,375,085 | 42,174 |
Cash, cash equivalents and restricted cash (in amount of $429,372), ending of period | 155,696,470 | 84,375,085 |
Supplemental disclosure of Cash Flow information: | ||
Cash paid for interest | 122,501 | 1,407,988 |
Supplemental Disclosure for Non-Cash Activities: | ||
Convertible notes and interest - conversion to common stock | 167,070,343 | 17,339,000 |
Exercise of warrants recognized earlier as liabilities | 627,836,463 | 555,161,139 |
Reclassification of derivatives to equity upon authorization of common shares | 47,818,882 | |
Waiver of dividends by stockholders | 7,387,808 | |
Common stock issued to extinguish other liabilities | 5,524,838 | |
Notes issued to extinguish liability to issue stock | 11,597,571 | |
Right-of-use assets obtained in exchange of operating lease liabilities | 2,112,773 | 4,081,716 |
Extinguishment of operational liabilities by sale of property | 760,669 | |
Preferred shares issued in exchange for convertible debt | 24,988,926 | |
Stock based payment for business acquired | 41,577,647 | |
Conversion of a note payable to a liability to issue shares | $ 10,413,900 | |
Extinguishment of financial liabilities by sale of property | $ 238,259 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
CONSOLIDATED STATEMENTS OF CASH FLOWS | ||
Restricted cash | $ 429,372 | $ 30,289,400 |
DESCRIPTION OF BUSINESS AND BAS
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | 12 Months Ended |
Sep. 30, 2023 | |
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | |
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | NOTE 1 –DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION Description of Business Mullen Automotive Inc., a Delaware corporation (“MAI”, “Mullen”, “we” or the “Company”), is a Southern California-based development-stage electric vehicle company that operates in various verticals of businesses focused within the automotive industry. Mullen Automotive Inc., a California corporation (“Previous Mullen”), was originally formed on April 20 2010, as a developer and manufacturer of electric vehicle technology and operated as the Electric Vehicle (“EV”) division of Mullen Technologies, Inc. (“MTI”) until November 5, 2021, at which time Previous Mullen underwent a capitalization and corporate reorganization by way of a spin-off to its shareholders, followed by a reverse merger with and into Net Element, Inc., which was accounted for as a reverse merger transaction, in which Previous Mullen was treated as the acquirer for financial accounting purposes. (the “Merger”). The Company changed its name from “Net Element, Inc.” to “Mullen Automotive Inc” and the Nasdaq ticker symbol for the Company’s common stock changed from “NETE” to “MULN” on the Nasdaq Capital Market at the opening of trading on November 5, 2021. Mullen is building and delivering the newest generation of Commercial Trucks. We also have a portfolio of high-performance Passenger vehicles in various stages of Product Development for launch in subsequent years. Acquisition of controlling interest in Bollinger Motors, Inc. (see Note 4 The second acquisition (see Note 4 Basis of Presentation and Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries Mullen Investment Properties LLC, a Mississippi corporation, Ottava Automotive, Inc., a California corporation, Mullen Real Estate, LLC, a Delaware corporation, as well as a 60%-owned subsidiary Bollinger Motors Inc., a Delaware corporation. Intercompany accounts and transactions have been eliminated, if any. Noncontrolling interest presented in these consolidated financial statements relates to the portion of equity (net assets) in subsidiaries not attributable, directly or indirectly, to Mullen. Net income or loss are allocated to noncontrolling interests by multiplying the relative ownership interest of the noncontrolling interest holders for the period by the net income or loss of the entity to which the noncontrolling interest relates. The financial statements reflect the consolidated financial position and results of operations of Mullen, which have been prepared in accordance with Generally Accepted Accounting Principles in the United States (“U.S. GAAP”). Reverse Stock Splits In January 2023, the Company’s stockholders, in an effort for the Company to regain compliance with NASDAQ listing rules, approved a proposal to authorize the Board of the Company (the “Board”) to implement a reverse stock split of the outstanding shares of the Company’s common stock at a ratio up to 1-for- 25 25 In August 2023, the Company’s stockholders approved a proposal to authorize the Board to implement a second reverse stock split of the outstanding shares of the Company’s common stock at a ratio up to 1-for- 100 9 In December 2023, the stockholders approved a proposal to authorize a reverse stock split of the Company’s common stock at a ratio within the range of 1 1 1 100 As a result of the reverse stock splits, the number of shares of common stock that can be issued upon exercise of warrants, preferred stock, and other convertible securities, as well as any commitments to issue securities, that provide for adjustments in the event of a reverse stock split, was appropriately adjusted pursuant to their applicable terms for the reverse stock splits. If applicable, the conversion price for each outstanding share of preferred stock and the exercise price for each outstanding warrant was increased, pursuant to their terms, in inverse proportion to the split ratio such that upon conversion or exercise, the aggregate conversion price for conversion of preferred stock and the aggregate exercise price payable by the warrant holder to the Company for shares of common stock subject to such warrant will remain approximately the same as the aggregate conversion or exercise price, as applicable, prior to the reverse stock splits. The reverse stock splits have not changed the authorized number of shares or the par value of the common stock nor modified any voting rights of the common stock. No proportionate adjustment was made to the number of shares reserved for issuance pursuant to the Company’s 2022 Equity Incentive Plan as per decision of stockholders that approved an amendment to the Plan in August 2023, increasing the maximum aggregate number of shares of common stock and stock equivalents available for the grant of awards under the 2022 Plan by an additional 52,000,000 shares, which amount is not subject to any decrease or increase in the number shares of common stock resulting from a stock spilt, reverse stock split, recapitalization, combination, reclassification, the payment of a stock dividend on the common stock or any other decrease in the number of such shares of common stock effected without receipt of consideration by the Company. No fractional shares were issued in connection with the reverse stock splits. All fractional shares were rounded up to the nearest whole share. The number and par value of Series A Preferred Stock, Series C Preferred Stock and Series D Preferred Stock were not affected by the reverse stock splits, but their conversion ratios have been proportionally adjusted. There were no outstanding shares of Series B Preferred Stock as of the effective date of the reverse stock splits. The Company retroactively adjusted its historical financial statements to reflect the reverse stock splits (See Note 10 The impact of the reverse stock splits on the shares of common stock previously reported for the fiscal year ended September 30, 2022 was as follows: Pre-RSS Adjustment to RSS 1:25 Adjustment to RSS 1:9 Adjustment to RSS 1:100 Total post-RSS Balance, September 30, 2021 7,048,387 (6,766,452) (250,609) (31,013) 313 Increase of common stock during fiscal year 2022 826,419,793 (793,363,001) (29,383,815) (3,636,247) 36,730 Balance, September 30, 2022 833,468,180 (800,129,453) (29,634,424) (3,667,260) 37,043 |
LIQUIDITY, CAPITAL RESOURCES, A
LIQUIDITY, CAPITAL RESOURCES, AND GOING CONCERN | 12 Months Ended |
Sep. 30, 2023 | |
LIQUIDITY, CAPITAL RESOURCES, AND GOING CONCERN | |
LIQUIDITY, CAPITAL RESOURCES, AND GOING CONCERN | NOTE 2 – LIQUIDITY, CAPITAL RESOURCES, AND GOING CONCERN These consolidated financial statements have been prepared on the basis that assumes the Company will continue as a going concern which contemplates the realization of assets and satisfaction of liabilities and commitments in the ordinary course of business. The Company's principal source of liquidity consists of existing cash and restricted cash of approximately $155.7 million as of September 30, 2023. During the twelve months ended September 30, 2023, the Company used approximately $179.2 million of cash for operating activities. The net working capital on September 30, 2023 was positive and amounted to approximately $58.5 million, or approximately $133.3 million after excluding derivative liabilities and liabilities to issue stock that are supposed to be settled by issuing common stock without using cash. For the year ended September 30, 2023, the Company has incurred a net loss of $1,006.7 million and, as of September 30, 2023, our accumulated deficit was $1,862.2 million. These factors raise substantial doubt as to the Company’s ability to continue as a going concern. The Company is evaluating strategies to obtain the required additional funding for future operations. These strategies may include, but are not limited to, obtaining equity financing, issuing debt, or entering other financing arrangements, and restructuring of operations to grow revenues and decrease expenses. However, given the impact of the economic downturn on the U.S. and global financial markets, the Company may be unable to access further equity or debt financing when needed. As such, there can be no assurance that the Company will be able to obtain additional liquidity when needed or under acceptable terms, if at all. Therefore, there can be no assurance that our plans will be successful in alleviating the substantial doubt about our ability to continue as a going concern. These financial statements do not include any adjustments that might result from the outcome of this uncertainties. During the year ended September 30, 2023, the COVID-19 pandemic did not have a material impact on our operating results. The Company has not observed any impairments of its assets or a significant change in the fair value of its assets due to the COVID-19 pandemic. At this time, it is not possible for the Company to predict the duration or magnitude of the adverse results of the outbreak and its effects on the Company’s business or results of operations, financial condition, or liquidity. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Sep. 30, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Significant accounting policies are defined as those that are reflective of significant judgments and uncertainties, and potentially result in materially different results under different assumptions and conditions. Use of Estimates The preparation of our financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the dates of the consolidated financial statements and the reported amounts of total expenses in the reporting periods. Estimates are used for, but not limited to, cash flow projections and discount rate for calculation of goodwill impairment, fair value and impairment of long-lived assets, including intangible assets, inventory reserves, accrued expenses, fair value of financial instruments, depreciable lives of property and equipment, income taxes, contingencies, valuation of preferred stock and warrants. Additionally, the rates of interest on several debt agreements have been imputed where there was no stated interest rate within the original agreement. Management bases its estimates on historical experience and on various other assumptions believed to be reasonable, the results of which form the basis for carrying values of assets and liabilities and the recording of costs and expenses that are not readily apparent from other sources. The actual results may differ materially from these estimates. Risks and Uncertainties We operate within an industry that is subject to rapid technological change, intense competition, and significant government regulation. It is subject to significant risks and uncertainties, including competitive, financial, developmental, operational, technological, required knowledge of industry governmental regulations, and other risks associated with an emerging business. Any one or combination of these or other risks could have a substantial influence on our future operations and prospects for commercial success. Business Combination Business acquisitions are accounted for in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 805 “Business Combinations” . FASB ASC 805 requires the reporting entity to identify the acquirer, determine the acquisition date, recognize and measure the identifiable tangible and intangible assets acquired, the liabilities assumed and any noncontrolling interest in the acquired entity, and recognize and measure goodwill or a gain from the purchase. The acquiree’s results are included in the Company’s consolidated financial statements from the date of acquisition. Assets acquired and liabilities assumed are recorded at their fair values and the excess of the purchase price over the amounts assigned is recorded as goodwill. Adjustments to fair value assessments are recorded to goodwill over the measurement period (not longer than twelve months). The acquisition method also requires that acquisition-related transaction and post-acquisition restructuring costs be charged to expense. The Company completed the acquisition of Bollinger Motors Inc. on September 7, 2022 (see Note 4 ). Cash and Cash Equivalents Company management considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. There were no cash equivalents as of September 30, 2023, and 2022, respectively. Restricted Cash Cash obtained from customer deposits is held by the Company and is restricted from use to fund operations. Refundable deposits were $429 thousand and $289 thousand for the years ended September 30, 2023, and 2022, respectively, and are presented as liabilities. On September 7, 2022, the Company deposited $30 million in an escrow account as part of the Bollinger Motors Inc. acquisition – these funds have been released for the use of Bollinger Motors Inc. during the year ended September 30, 2023. Prepaid Expenses and Other Current Assets Prepaid expenses consist of various advance payments made for goods or services to be received in the future. These prepaid expenses include insurance and other contracted services requiring up-front payments. Inventory Cost of inventories is determined using the standard cost method, which approximates actual cost on a first-in first-out basis. This method includes direct materials, direct labor, and a proportionate share of manufacturing overhead costs based on normal capacity. As of September 30, 2023 there have been no significant direct labor or manufacturing overhead costs included in inventory. Regular reviews are performed to identify and account for variances between the standard costs and actual costs. Any variances identified are recognized in the cost of goods sold during the period in which they occur. On a quarterly basis, the Company reviews its inventory for excess quantities and obsolescence. This analysis takes into account factors such as demand forecasts, product life cycles, product development plans, and current market conditions. Provisions are made to reduce the carrying value of the inventories to their net realizable value. Once inventory is written down, a new, lower-cost basis is established, and the inventory is not subsequently written up if market conditions improve. All such inventory write-downs are included as a component of cost of goods sold in the period in which the write-down occurs. Adjustments to these estimates and assumptions could impact our financial position and results of operations. Property, Plant, and Equipment, net Property, plant, and equipment is stated at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated economic useful lives of the assets. Repairs and maintenance expenditures that do not extend the useful lives of related assets are expensed as incurred. Estimated Useful Lives Description Life Buildings 20 Furniture and equipment 3 to 7 years Computer and software 1 to 5 years Machinery, shop and testing equipment 3 to 7 years Leasehold improvements Shorter of the estimated useful life or the underlying lease term Vehicles 5 years Expenditures for major improvements are capitalized, while minor replacements, maintenance and repairs, which do not extend the asset lives, are charged to operations as incurred. Upon sale or disposition, the cost and related accumulated depreciation are removed from the accounts and any gain or loss is included in operations. Company management continually monitors events and changes in circumstances that could indicate that the carrying balances of its property, plant, and equipment may not be recoverable in accordance with the provisions of ASC 360, “Property, Plant, and Equipment.” flows. If the total of the future cash flows is less than the carrying amount of those assets, we recognize an impairment loss based on the excess of the carrying amount over the fair value of the assets. Income Taxes Income taxes are recorded in accordance with ASC 740 , Income Taxes Uncertain tax positions taken or expected to be taken in a tax return are accounted for using the “more likely than not” threshold for financial statement recognition and measurement. There are transactions that occur during the ordinary course of business for which the ultimate tax determination may be uncertain. At September 30, 2023 and 2022, there were no material changes to either the nature or the amounts of the uncertain tax positions. The Company’s income tax provision consists of an estimate for U.S. federal and state income taxes based on enacted rates, as adjusted for allowable credits, deductions, uncertain tax positions, changes in deferred tax assets and liabilities, and changes in the tax law. We maintain a full valuation allowance against the value of our deferred tax assets because based on the weight of evidence available at September 30, 2023 and 2022, it is more likely than not that deferred tax assets will not be realized. Intangible Assets, net Intangible assets consist of acquired and developed intellectual property. In accordance with ASC 350, “Intangibles—Goodwill and Others,” Intangible assets with determinate lives are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Amortizable intangible assets generally are amortized on a straight-line basis over periods up to 120 months. The costs to periodically renew our intangible assets are expensed as incurred. Impairment of Long-Lived Assets The Company periodically evaluates long-lived assets (both intangible assets and property, plant, and equipment) for impairment whenever events or changes in circumstances indicate that a potential impairment may have occurred. If such events or changes in circumstances arise, the Company compares the carrying amount of the long-lived assets to the estimated future undiscounted cash flows expected to be generated by the long-lived assets. If the estimated aggregate undiscounted cash flows are less than the carrying amount of the long-lived assets, an impairment charge, calculated as the amount by which the carrying amount of the assets exceeds the fair value of the assets, is recorded. The fair value of the long-lived assets is determined based on the estimated discounted cash flows expected to be generated from the long-lived asset unless another method provides a more reliable estimate. If an impairment loss is recognized, the adjusted carrying amount of a long-lived asset is recognized as a new cost basis of the impaired asset. Impairment loss is not reversed even if fair value exceeds carrying amount in subsequent periods. Other Assets Other assets are comprised primarily of prepayments and security deposits for property leases. Extinguishment of Liabilities The Company derecognizes financial liabilities when the Company’s obligations are discharged, cancelled, or expired. Leases The Company follows the provisions of ASC 842, “Leases” Contingencies and Commitments The Company follows ASC 440 & ASC 450 to account for contingencies and commitments respectively. Certain conditions, as a result of past events, may exist as of the balance sheet date, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be reasonably estimated, then the estimated liability is accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be reasonably estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed. Legal costs associated with such loss contingencies are expensed as incurred. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Accrued Expenses Accrued expenses are expenses that have been incurred but not yet paid and are classified within current liabilities on the consolidated balance sheets. Revenue Recognition The Company’s revenue includes revenue from the sale of electric vehicles and is accounted for in accordance with ASC 606, “Revenue from Contracts with Customers” been sold by such dealer or until there is sufficient evidence to justify a reasonable estimate for the amount of consideration to which the Company expects to be entitled. For any amounts received (or receivable) for which the Company does not recognize revenue when it transfers products to customers, a refund liability is recognized (amounted to $652,200 as at September 30, 2023, none at September 30, 2022). Relevant vehicles transferred to the dealer are presented as “Finished goods delivered to dealer for distribution” in the consolidated balance sheets at initial cost, less any expected costs to recover those products (including potential decreases in the value to the entity of returned products). At the end of each reporting period, the Company updates the measurement of these assets and refund liabilities. Cost of Goods Sold The Company’s cost of goods sold includes mainly production costs of vehicles sold in the relevant period as well as a provision for expected warranty expenses. General and Administrative Expenses General and administrative (“G&A”) expenses include expenses such as salaries and employee benefits, professional fees, rent, repairs and maintenance, utilities and office expense, depreciation and amortization, advertising and marketing, settlements and penalties, taxes, and licenses. Advertising costs are expensed as incurred and are included in G&A expenses, other than trade show expenses which are deferred until occurrence of the future event, we expense advertising costs as incurred in accordance with ASC 720-35, “Other Expenses – Advertising Cost.” Research and Development Costs Per ASC 730, "Research and Development," Share-Based Compensation The share-based awards issued by the Company are accounted for in accordance with ASC Subtopic 718-10, “Compensation – Share Compensation The overwhelming part of share-based awards to employees per employment contracts, and a certain part of contracts with non-employees (consultants) are classified as equity with costs and additional paid-in capital recognized ratably over the service period. A significant part of the Company’s share-based awards to consultants is liability-classified: mainly if the number of shares consultant is entitled to depends on a certain monetary value fixed in the contract. An accrued part of liability in this case is revaluated each period based on market price of the shares of common stock of the Company, until sufficient number of shares is issued. The Company has also adopted incentive plans that entitle the Chief Executive Officer to share-based awards generally calculated as 1-3% of then outstanding number of shares of common stock, issuable upon achievement of specific financial and operational targets (milestones) that are supposed to significantly increase value of the Company. This share-based compensation is accrued over the service term when it is probable that the milestone will be achieved. The liability to issue stock (presented within non-current liabilities if the achievement is expected later than 12 month after the balance sheet date) is revalued on every balance sheet date based on the length of the service period, current market price of the common stock and on the number of shares of common stock outstanding – until the shares have been issued, or until fulfilling the milestone requirements becomes unlikely. Fair Value of Financial Instruments We apply fair value accounting for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value on a recurring basis. Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities that are required to be recorded at fair value, Company management considers the principal or most advantageous market in which we would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as risks inherent in valuation techniques, transfer restrictions and credit risk. Fair value is estimated by applying the hierarchy as per requirements of ASC 820, “Fair value measurements” Concentrations of Credit Risk The Company maintains cash balances in several financial institutions that are insured by either the Federal Deposit Insurance Corporation or the National Credit Union Association up to certain federal limitations, generally $250,000. At times, our cash balance may exceed these federal limitations. However, we have not experienced any losses in such accounts and management believes we are not exposed to any significant credit risk on these accounts. The amounts in excess of insured limits as of September 30, 2023 and 2022 are $154.9 million and $53.3 million, respectively. Accounting Pronouncements The Company has implemented all new applicable accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements. The following are accounting pronouncements that have been issued but are not yet effective for the Company’s consolidated financial statements: In June 2016, the FASB issued ASU 2016-13, “ Measurement of Credit Losses on Financial Instruments In August 2020, the FASB issued ASU No. 2020-06, Debt—Debt with Conversion and Other Options Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt-Modifications and Extinguishments (Subtopic 470-50), Compensation-Stock Compensation (Topic 718), and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40) In November 2023, the FASB issued Accounting Standards Update 2023-07— Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. Other accounting pronouncements issued but not yet effective are not believed by management to be relevant or to have a material impact on the Company’s present or future consolidated financial statements. |
ACQUISITION OF SUBSIDIARIES AND
ACQUISITION OF SUBSIDIARIES AND CERTAIN ASSETS | 12 Months Ended |
Sep. 30, 2023 | |
ACQUISITION OF SUBSIDIARIES AND CERTAIN ASSETS | |
ACQUISITION OF SUBSIDIARIES AND CERTAIN ASSETS | NOTE 4 – ACQUISITION OF SUBSIDIARIES AND CERTAIN ASSETS Acquisition of Bollinger Motors, Inc. On September 7, 2022, the Company acquired, through a series of purchase agreements, 544,347 shares of common stock of Bollinger Motors, Inc. (“Bollinger Motors”), representing approximately 60% of the outstanding shares. This acquisition has provided the Company with opportunities to produce medium duty truck classes 4-6, along with the B1 Sport Utility and B2 Pick Up Trucks. The following table summarizes the purchase price consideration to acquire Bollinger Motors: Cash consideration paid at closing $ 75,000,000 Cash consideration deferred 32,000,000 Stock consideration (2,827 shares of common stock of Mullen) 41,577,647 Fair value of total consideration transferred $ 148,577,647 Total consideration of $148.6 million paid to Bollinger Motors Inc. and Bollinger Motors Inc. shareholders included: ● Cash consideration due was approximately $107 million, of which $75 million was paid at closing and $32 million was deposited into an escrow account on November 29, 2022. ● Stock consideration due to shareholders of Bollinger Motors was 2,827 shares of the Company’s common stock (giving effect to reverse stock splits, see Note 1 ) with a fair value of approximately $41.6 million. The Company has determined that the acquisition of Bollinger Motors constitutes a business acquisition as defined by ACS 805, Business Combinations 820, Fair Measurements and Disclosure As a result of the acquisition, Mullen acquired controlling interest of Bollinger Motors. Acquired intellectual property, patents and non-compete agreements have finite lives and will be amortized using the straight-line method of the respective lives of each asset, acquired in-process research and development assets have indefinite lives and will be tested for impairment at least annually (see Note 6 Intangible assets The following tables summarize the allocation of fair value of assets acquired and liabilities assumed. Purchase consideration Cash consideration $ 107,000,000 Stock consideration 41,577,647 Total consideration transferred for 60% of Bollinger Motors 148,577,647 Noncontrolling interest (40%) 99,051,765 Fair value of the entity $ 247,629,412 Recognized amounts of identifiable assets acquired and liabilities assumed Cash and restricted cash $ 77,238,086 In-process research and development assets 58,304,612 Patents 32,391,186 Other current assets 867,112 Trademarks 1,075,048 Property, plant, and equipment 1,009,662 Non-compete agreements 745,947 Other non-current assets 246,896 Deferred tax liability (14,882,782) Accounts payable (638,752) Refundable deposits (213,679) Other current liabilities (993,628) Total identifiable net assets $ 155,149,708 Noncontrolling interest (99,051,765) Goodwill 92,479,704 $ 148,577,647 Valuation Methodology The fair value of in-process research and development assets was determined using the Multiperiod Excess Earnings Method. This method was applied to the core intellectual property of Bollinger Motors consisting of the designs and processes. Under this method, the Company determines free cash flows for a group of assets, and then adjusts it for a contributory charge for the use of other identifiable tangible and intangible assets. The present value of the resulting excess cash flows is adjusted for any tax benefits and the resulting amount represents the fair value of the intangible asset. The fair value of the Company’s patents was determined using the Relief from Royalty Method. The method considers what a purchaser could afford, or would be willing to pay, for a license of similar intellectual property rights. The royalty stream is then capitalized reflecting the risk and return relationship of investing in the asset. The Company used 5% as an initial royalty rate, gradually decreasing it to 1% over 10 years in 2031 to reflect technological obsolescence. The non-compete agreement was valued using a discounted cash flow with and without method. Under this method, estimated enterprise value is calculated with non-complete clauses and compared to the enterprise value in the absence of the clauses. Estimated enterprise value is determined as present value of future cash flows. The after-tax differential of enterprise value is adjusted for the probability, reflecting specific facts and circumstances. As part of application of the above methods, the annual discount rate used to determine the present value of future cash flows varied between 40% and 42%. Assumptions used in forecasting cash flows and determining the fair value for each of the identified intangible asset included consideration of the following: - Historical performance of the assets, sales and profitability - Estimation of the economic life of the assets - Risk profile of individual assets - Business prospects and industry expectations - Tax amortization benefits on intangible assets - Acquisition of new customers. Supplemental pro forma information The following supplemental pro forma information summarizes the Company’s results of operations for the fiscal year ended September 30, 2022, as if the Company completed the acquisition as of the beginning of the annual reporting period beginning October 1, 2021. Year ended September 30, 2022 2021 Total Revenues — — Net loss (753,916,185) (57,647,534) Mullen Advanced Energy Operations LLC On April 17, 2023, the Company entered into a binding Letter of Agreement with Lawrence Hardge, Global EV Technology, Inc., and EV Technology, LLC (collectively, “EVT”) to partner on a device known as a Battery Life Enhancing Technology. The parties formed a new corporation called Mullen Advanced Energy Operations (“MAEO”) to develop, manufacture, market, sell, lease, distribute, and service all products resulting from the technology. The Company holds a 51% equity interest in MAEO, and EVT holds a 49% equity interest. EVT was supposed to license the technology and intellectual property rights to MAEO and assign all rights to governmental and other contracts relating to the technology. The Company paid Mr. Hardge an upfront payment of $50,000 and an additional $5.0 million payment was due upon execution of definitive agreements and completion of IP assignment. On July 10, 2023, the Company issued a notice terminating the Agreement dated April 17, 2023. The termination notice, which was sent after numerous attempts by the Company to obtain adherence by EVT to the terms of the Agreement, references several breaches by EVT including (1) failing to execute documents evidencing an irrevocable, royalty free, worldwide exclusive license to the Technology and IP, in perpetuity, to MAEO, (2) refusing to conduct any tests of the Technology at a Mullen approved facility after the LOA, (3) repeatedly refusing to honor the terms of the Mutual Non-Disclosure Agreement signed April 14, 2023, and (4) failing to disclose all claims or threatened legal actions by any third parties related to the Technology. MAEO has not had significant transactions since formation. Acquisition of ELMS assets On October 13, 2022, the United States Bankruptcy Court for the District of Delaware issued an order approving the sale for approximately $105 million to Mullen of certain assets and assumption and assignment of contracts and related liabilities of Electric Last Mile, Inc. and Electric Last Mile Solutions, Inc. (collectively, “ELMS”) pursuant to the terms and conditions of the Asset Purchase Agreement dated September 16, 2022. The ELMS asset acquisition closed on November 30, 2022, and is expected to accelerate the market introduction of our cargo van program and provide us with critical manufacturing capacity at a much lower investment than previously expected to supply the rest of our product portfolio. ELMS assets include: ● The factory in Mishawaka, Indiana, providing Mullen with the capability to produce up to 50,000 vehicles per year; ● All Intellectual Property, including all manufacturing data that is required for the assembly of the Class 1 van and Class 3 Cab Chassis; ● All inventory including finished and unfinished vehicles, part modules, component parts, raw materials, and tooling; and ● All property including equipment, machinery, supplies, computer hardware, software, communication equipment, data networks and all other data storage. The following table details the allocation of purchase price by asset category for the ELMS asset purchase: Asset Category Fair Value Allocation Land $ 1,440,000 Buildings and site improvements 41,287,038 Equipment 27,336,511 Intangible assets: engineering design 22,112,791 Inventory 13,198,692 Total Purchased Assets $ 105,375,032 On November 9, 2022, the Company formed Mullen Indiana Real Estate LLC, a limited liability company in the State of Delaware, to hold the acquired real property located in Mishawaka, Indiana. |
INVENTORY
INVENTORY | 12 Months Ended |
Sep. 30, 2023 | |
INVENTORY | |
INVENTORY | NOTE 5 – INVENTORY The Company's inventories are stated at the lower of cost or net realizable value and consist of the following: September 30, 2023 Inventory Work in process 3,136,590 Raw materials 13,733,385 Finished goods delivered to dealer for distribution 937,322 Less: write-down to net realizable value (1,000,284) Total Inventory $ 16,807,013 The cost of inventories is determined using a standard cost method, which approximates the first-in, first-out (FIFO) method. This includes direct materials, direct labor, and relevant manufacturing overhead costs. Variances between standard and actual costs are recognized in the cost of goods sold during the period in which they occur. The Company regularly reviews its inventories for excess and obsolete items by assessing their net realizable value (NRV). The NRV is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. During the year ended September 30, 2023, a charge of $1 million was recorded to write the inventories down to NRV. During the year ended September 30, 2023, approximately $1 million of the Company's inventories was consumed for R&D activities, which was recognized as part of research and development expense in the consolidated statement of operations. |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 12 Months Ended |
Sep. 30, 2023 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | |
GOODWILL AND OTHER INTANGIBLE ASSETS | NOTE 6 – GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill The goodwill in gross amount of $92,834,832 and net carrying amount of $28,846,832 as at September 30, 2023 (and $92,834,832 gross and net carrying amount as at September 30, 2022) pertains to the Bollinger Motors acquisition on September 7, 2022 (see Note 4 Goodwill is not amortized and is tested for impairment annually, or more frequently if there are indicators of impairment. Every reporting period the Company assesses qualitative factors (such as macroeconomic conditions, industry and market considerations, financial performance of the Company, entity-specific events etc.) to determine whether it is necessary to perform the quantitative goodwill impairment test. Upon the quantitative goodwill impairment test, impairment may arise to the extent carrying amount of a reporting unit that includes goodwill (i.e. Bollinger production unit, see Note 21 – Segment information As a result of the impairment test performed on September 1, 2023 by management with the assistance of independent third-party valuation professionals, the Company has recognized impairment loss in amount of $63,988,000. We used a combination of the market and income approach to determine fair value. Full amount of the loss has been recognized in the consolidated statement of operations, and the part of the loss that relates to noncontrolling interest in the subsidiary ($25,595,200) has decreased noncontrolling interest in equity section of the consolidated balance sheets. The goodwill impairment was caused mainly by unfavorable capital market conditions, i.e., prolonged decrease in the Company’s market capitalization, including a significant decline in stock price and a budgeted performance misses compared to the budgets prepared on acquisition date. The quantitative goodwill impairment tests were based on determining the fair value of the Bollinger Motors reporting units based on management judgments and assumptions using the discounted cash flows under the income approach classified in Level 3 of the fair value hierarchy and comparable company market valuation classified in Level 2 of the fair value hierarchy approaches. If the carrying value of a reporting unit exceeds its fair value, the Company will measure any goodwill impairment loss as the amount by which the carrying amount of a reporting unit exceeds its fair value, not to exceed the total amount of goodwill allocated to that reporting unit. The valuation approaches are subject to key judgments and assumptions that are sensitive to change such as judgments and assumptions about appropriate sales growth rates, operating margins, discount rate, and comparable company market multiples. When developing these key judgments and assumptions, the Company considers economic, operational and market conditions that could impact the fair value of the reporting unit. However, estimates are inherently uncertain and represent only management’s reasonable expectations regarding future developments. These estimates and the judgments and assumptions upon which the estimates are based will likely differ in some respects from actual future results. Other intangible assets Intangible assets are stated at cost, net of accumulated amortization. Patents and other identifiable intellectual property purchased as part of the Bollinger Motors acquisition in September 2022 have been initially recognized at fair value. Intangible assets with indefinite useful lives are not amortized but instead tested for impairment. Intangible assets with finite useful lives are amortized over the period of estimated benefit using the straight-line method. The weighted average useful life of intangible assets is 8.97 years. The straight-line method of amortization represents management’s best estimate of the distribution of the economic value of the intangible assets. Due to unfavorable market conditions and decline of the market prices of the Company’s common stock, we have tested long-lived assets for recoverability. Based on the test performed on September 1, 2023 by independent professional appraisers, the assets of the Bollinger's segment (see Note 21 - Segment information An impairment loss in amount of $5,873,000 has been recognized in respect of the intangible assets of the ELMS/Legacy Mullen segment (primarily engineering designs and website design and development). Their accumulated depreciation in amount of $4,318,850 has been derecognized in correspondence with initial cost to present the new cost basis of these assets in accordance with ASC 350-30. Fair value of the engineering designs (classified in Level 3 of the fair value hierarchy) was estimated based on cost approach, which involves evaluation of the costs required to replace or recreate the subject intangible assets. Significant judgments inherent in this analysis include the accuracy of the historical cost data, obsolescence factor, probability of success related to the commercialization of the reporting segment that utilizes the engineering designs. September 30, 2023 September 30, 2022 Net Net Cost Accumulated Carrying Cost Accumulated Carrying Basis Amortization Amount Basis Amortization Amount Finite-Lived Intangible Assets Website design and development $ — $ — $ — $ 2,660,391 $ (1,108,496) $ 1,551,895 Patents 31,708,460 (3,445,694) 28,262,766 32,391,186 (204,109) 32,187,077 Engineering designs 16,200,332 (184,274) 16,016,058 — — — Other 745,947 (158,590) 587,357 2,259,575 (454,756) 1,804,819 Trademarks 1,180,138 (115,682) 1,064,456 466,014 — 466,014 Total finite-lived intangible assets 49,834,877 (3,904,240) 45,930,637 37,777,166 (1,767,361) 36,009,805 Indefinite-Lived Intangible Assets In-process research and development assets $ 58,304,612 $ — $ 58,304,612 $ 57,937,213 $ — $ 57,937,213 Total indefinite-lived intangible assets 58,304,612 — 58,304,612 57,937,213 — 57,937,213 Total Intangible Assets $ 108,139,489 $ (3,904,240) $ 104,235,249 $ 95,714,379 $ (1,767,361) $ 93,947,018 Total future amortization expense for finite-lived intangible assets is as follows: Years Ended September 30, 2023 Future Amortization 2024 $ 5,250,711 2025 5,250,711 2026 5,250,711 2027 5,241,310 2028 5,101,522 Thereafter 19,835,672 Total Future Amortization $ 45,930,637 For the years ended September 30, 2023 and 2022, amortization of the intangible assets was $6,526,911 and $1,476,457 respectively. |
DEBT
DEBT | 12 Months Ended |
Sep. 30, 2023 | |
DEBT | |
DEBT | NOTE 7 – DEBT Short and Long-Term Debt Short-term debt is defined as debt with principal maturities of one year or less, long-term debt has maturities greater than one year. The following is a summary of our indebtedness at September 30, 2023: Net Carrying Value Unpaid Principal Contractual Contractual Type of Debt Balance Current Long-Term Interest Rate Maturity Matured notes $ 2,398,881 $ 2,398,881 $ — 0.00 - 10.00 % 2019 - 2021 Real Estate note 5,000,000 5,000,000 — 8.99 % 2023-2024 Loan advances 332,800 332,800 — 0.00 - 10.00 % 2016 - 2018 Less: debt discount (270,189) (270,189) — NA NA Total Debt $ 7,461,492 $ 7,461,492 $ — The following is a summary of our indebtedness at September 30, 2022: Net Carrying Value Unpaid Principal Contractual Contractual Type of Debt Balance Current Long-Term Interest Rate Maturity Matured notes $ 3,051,085 $ 3,051,085 $ — 0.00 - 10.00% 2019 - 2021 Promissory notes 1,096,787 — 1,096,787 28.00% 2024 Real Estate note 5,247,612 247,612 5,000,000 5.0 - 8.99% 2023 - 2024 Loan advances 557,800 557,800 — 0.00 - 10.00% 2016 – 2018 Less: debt discount (932,235) — (932,235) NA NA Total Debt $ 9,021,049 $ 3,856,497 $ 5,164,552 Scheduled Debt Maturities The following are scheduled debt maturities as at September 30, 2023: Years Ended September 30, 2023 2024 2025 2026 2027 Total Total Debt $ 2,717,804 $ 4,743,688 $ — $ — $ — $ 7,461,492 Notes and Advances In November 2022, we issued convertible instruments with detachable warrants, resulting in the recognition of a debt discount, which is amortized to interest expense over the term of the relevant instrument. Debt discount on convertible notes with detachable warrants in the amount of $150,000,000 (see below) was presented in the statement of operations as "Other financing costs - initial recognition of derivative liabilities" and in the cash flow statement – in the line item “Initial recognition of derivative liabilities”. The Company issued shares of common stock to certain creditors for the conversion of convertible notes, satisfaction of debt payments, and in settlement of indebtedness. For the year ended September 30, 2023, the carrying amount of indebtedness that was settled via issuance of shares of our common stock was $167,070,343 (this relates mainly to convertible notes issued in lieu of preferred stock and relevant interest, see below). NuBridge Commercial Lending LLC Promissory Note On March 7, 2022, the Company’s wholly owned subsidiary, Mullen Investment Properties, LLC, entered into a Promissory Note (the “Promissory Note”) with NuBridge Commercial Lending LLC for a principal amount of $5 million. The Promissory Note bears interest at a fixed rate of 8.99% per annum and the principal amount is due March 1, 2024. Collateral for the loan includes the title to the Company’s property at 1 Greentech Drive, Tunica, MS. Under the Promissory Note, prepaid interest and issuance costs of $1,157,209 were withheld from the principal and recorded as debt discount, which is being amortized over the term of the Promissory note. As of September 30, 2023, the remaining unamortized debt discount was $270,188. Drawbridge and Amended A&R Note with Esousa On October 14, 2022, the Company entered into an Amended and Restated Secured Convertible Note and Security Agreement (the “A&R Note”) with Esousa Holdings LLC (“Esousa”), including principal of $1,032,217 (net of debt discount of $64,570) and accrued interest of $316,127 along with the liability to issue 467 shares of common stock (having a then carrying value of $10,710,000) and an obligation to compensate for the losses from market value decline of shares were exchanged for a new convertible note payable with a face value of $12,945,914 and 1,022 shares of common stock (having a fair value of $5,524,600), resulting in a loss on extinguishment of $6,452,170. On November 1, 2022, the A&R Note payable to Esousa, inclusive of any accrued interest, was converted into 2,758 shares of common stock. Convertible Notes On November 14, 2022, the Company entered into Amendment No. 3 (“Amendment No. 3”) to the June 7, 2022, Securities Purchase Agreement (as amended, the “Series D SPA”). The investors paid $150 million and, in lieu of receiving shares of Series D Preferred Stock and warrants, the investors received notes convertible into shares of the Company’s common stock (“Notes”) and warrants. Amendment No. 3 further provided that the remaining $90 million of the commitment amount will be paid in the first half of 2023 in two tranches. The purchase price per share of Series D Preferred Stock would be the lower of (i) $1.27 ($28,575 after reverse stock splits, see Note 1 Note 8 Warrants and Other Derivative Liabilities and Fair Value Measurements. On November 15, 2022, the Company issued the unsecured convertible Notes aggregating $150,000,000 in lieu of Series D Preferred Stock. The Notes bear interest at 15% and were convertible into shares of common stock either: (A) at the option of the noteholder at the lower of: (i) $0.303 (to be adjusted to stock splits); or (ii) the closing price of our common stock on January 3, 2023; or (B) mandatorily on November 21, 2022 at the lower of: (i) $0.303 ($6,818 after reverse stock splits, see Note 1 authorized shares were available. For each share issued upon conversion, the holders were entitled to 1.85 times as many five-year warrants with an exercise price equal to the conversion price for the Notes. As a result, and since the Company had an insufficient number of authorized shares available to settle potential future warrant exercises, the Company recognized a derivative liability of $244,510,164 for the warrants On December 23, 2022, the Company defaulted on the Notes by not having sufficient authorized shares to allow for both the Notes to be fully converted and the warrants to be exercised. On January 13, 2023, the Company entered into a Settlement Agreement and Release in which investors waived the default prior to February 1, 2023. In exchange, the Company granted the investors the right to purchase additional shares of Series D Preferred Stock and warrants in an amount equal to such investor’s pro rata portion of $10 million. This right expired on June 30, 2023. During February 2023, the remaining balance of the Notes (with the principal of $90,362,418) and accrued interest (in amount of $3,456,941) were converted by the holders into 13,762 shares of common stock. See Note 8 Warrants and Other Derivative Liabilities and Fair Value Measurements As of September 30, 2023 and 2022, accrued interest on outstanding notes payable was $1,548,723 and $1,374,925, respectively. |
WARRANTS AND OTHER DERIVATIVE L
WARRANTS AND OTHER DERIVATIVE LIABILITIES AND FAIR VALUE MEASUREMENTS | 12 Months Ended |
Sep. 30, 2023 | |
WARRANTS AND OTHER DERIVATIVE LIABILITIES AND FAIR VALUE MEASUREMENTS | |
WARRANTS AND OTHER DERIVATIVE LIABILITIES AND FAIR VALUE MEASUREMENTS | NOTE 8 – WARRANTS AND OTHER DERIVATIVE LIABILITIES AND FAIR VALUE MEASUREMENTS ASC 825-10 defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact and considers assumptions that market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of non-performance. ASC 825-10 establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 825-10 establishes three levels of inputs that may be used to measure fair value: ● Level 1 – Quoted prices in active markets for identical assets or liabilities. ● Level 2 – Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which all significant inputs are observable or can be derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities. ● Level 3 – Unobservable inputs to the valuation methodology that are significant to the measurement of fair value of assets or liabilities. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement is disclosed and is determined based on the lowest level input that is significant to the fair value measurement. Financial Instruments at Carrying Value That Approximated Fair Value Certain financial instruments that are not carried at fair value on the consolidated balance sheets are carried at amounts that approximate fair value, due to their short-term nature and credit risk. These instruments include cash and cash equivalents, accounts payable, and debt. Accounts payable are short-term in nature and generally are due upon receipt or within 30 to 90 days. Non-Financial Assets Measured at Fair Value on a Non-Recurring Basis Non-financial assets are only required to be measured at fair value when acquired as a part of business combination or when an impairment loss is recognized. See Note 4 – Acquisition of subsidiaries Note 14 - Property, Plant, and Equipment Note 6 – Intangible assets . Financial Liabilities Measured at Fair Value on a Recurring Basis During the year ended September 30, 2023, the Company had the following financial liabilities measured at fair value on a recurring basis: Preferred C Warrants The warrants, which were exercisable for common stock, issued in connection with the sale of Series C Preferred Stock (the “Preferred C Warrants”) in accordance with the November 2021 Merger Agreement and further amendments had an exercise price per share of $8.834 (after the reverse stock splits - $198,765) and a cashless exercise option based on certain formula established by relevant contracts. These warrant liabilities were recognized as liabilities due to requirements of ASC 480 because the variable number of shares to be issued upon cashless exercise (which was deemed to be the predominant exercise option) is based predominantly on a fixed monetary value. The initial financial costs recorded upon the issuance of the Preferred C Warrants during the year ended September 30, 2022 was $429,883,573. This amount is comprised of $137,090,205 preferred stock discount (amortized immediately as the preferred stock does not have a stated term of life) and $292,793,368 finance costs (calculated as the difference between fair value of warrant liabilities recognized and the preferred stock discount). At each warrant exercise date and each accounting period end the warrant liability for the remaining unexercised warrants was marked-to-market value and the resulting gain or loss was recorded. On February 10, 2022, the terms of the Preferred C Warrants were amended, resulting in a change to the calculated derived dollar amount. The effect of these changes in the amount of $32,735,345 has been accounted for as deemed dividends on preferred stock and decreased additional paid-in capital of the Company. During the year ended September 30, 2022, 1,864 (giving effect to the reverse stock splits, see Note 1 During the quarter ended December 31, 2022, 132 Preferred C Warrants that remained outstanding as at September 30, 2022 were fully exercised. Preferred D Warrants In accordance with Series D SPA for every share of Series D Preferred Stock purchased, the investors received 185% (for the final $100 million voluntary investment right expiring June 30, 2023 - 110%) warrants (the “Preferred D Warrants”) exercisable for shares of common stock at an exercise price equal to the lower of (i) $1.27 (after the reverse stock splits - $28,575) or (ii) the market price of common stock on the trading day immediately preceding the purchase notice date. The Preferred D Warrants are exercisable during a five-year period commencing upon issuance. The contracts for the Preferred D Warrants contain cashless exercise provisions similar to Preferred C Warrants described above. Therefore, management applied similar accounting treatment to recognition, measurement, and presentation of the warrant liabilities. In September 2022, the Company received initial investment in amount of $35 million (exercise price was $0.4379, or $9,853 after reverse stock splits) and issued to investors 79,926,925 shares of Series D preferred stock, and 263 Preferred D Warrants (hereinafter warrants and shares of common stock are presented giving effect to the reverse stock splits, see Note 1 By September 30, 2022, no Preferred D Warrants were exercised and all Preferred D Warrants remained outstanding with the fair value on September 30, 2022 in the amount of $55,398,551. During the quarter ended December 31, 2022, all initial Preferred D Warrants were exercised on a cashless basis for 10,182 shares of common stock. In November 2022, the Company received $150,000,000 and issued, in lieu of Series D Preferred Stock, notes convertible into shares of common stock and Preferred D Warrants. As a result of the conversion of the convertible debt into shares of common stock in November 2022 and February 2023, 43,616 Preferred D Warrants were issued. By June 30, 2023, all these Preferred D Warrants were exercised on a cashless basis for 93,664 shares of common stock. During April 2023, we exercised our investment rights under the Series D SPA and requested additional $45 million (exercise price was $0.1 or $2,250 after reverse stock splits) issuing to investors: 273,363,635 Series D Preferred Stock, 7,851 shares of common stock (in lieu of Series D Preferred Stock), and 37,000 Preferred D Warrants (post reverse stock split). The warrant liability recognized initially amounted to $73,260,454. By June 30, 2023 all these Preferred D Warrants were exercised on a cashless basis for 147,672 shares of common stock (post reverse stock split). In June 2023, we exercised the second half of our investment right for $45 million (exercise price was $0.432 or $388.8 after reverse stock splits) and, in lieu of Series D Preferred Stock, investors received: 60,778 shares of common stock and 54,962 prefunded warrants exercisable for one share of common stock each, as well as 214,120 Preferred D Warrants. In June 2023, one of the investors exercised their investment rights and invested $7 million (exercise price was $0.52 or $468 after reverse stock splits). The Company issued, in lieu of Series D Preferred Stock, 14,957 shares of common stock and 27,671 Preferred D Warrants. Final voluntary investment rights under the Series D SPA have been exercised by the pool of investors in June 2023 and the Company received $100 million (exercise price was $0.1601, or $144.09 after reverse stock splits, for majority of investors, and $0.1696, or $152.64 after reverse stock splits, for one the investors), issuing to investors, in lieu of Series D Preferred Stock: 183,731 shares of common stock and 508,159 prefunded warrants exercisable for one share of common stock each, as well as 761,079 Preferred D Warrants. The warrant liability recognized in June 2023 upon initial accounting of these investments amounted to $254,962,776. By September 30, 2023, a part of these prefunded warrants and Preferred D Warrants was exercised on a cashless basis for 2,194,413 shares of common stock (post reverse stock splits). As of September 30, 2023, none of prefunded warrants and 382,436 Preferred D Warrants (recognized as liability in the consolidated balance sheets) exercisable into 1,438,009 shares of common stock with fair value of $64,739,175 remained outstanding and their exercise (on a cash or cashless basis) is available to investors for a period of approximately 5 years. The fair value of warrant obligations is calculated based on the number and market value of shares that can be issued upon exercise of the warrants. The number of shares to be issued in accordance with relevant agreements is variable and depends on (i) lowest closing market price of shares for 2 days before the exercise, and (i) multiplicator calculated based on Black Scholes formula where all elements, except for risk-free rate, are fixed on the investment date. Accordingly, the fair value of warrants on recognition date and on subsequent dates was estimated as a maximum of (i) Black Scholes value for cash exercise of relevant warrants and (ii) current market value of the number of shares the Company would be required to issue upon cashless warrant exercise on a relevant date in accordance with warrant contract requirements. The latter valuation, based on observable inputs (level 2), has been higher and reflects the pattern of the warrants exercise since the inception of the Series D SPA. At each warrant exercise date and each accounting period end the warrant liability for the remaining unexercised warrants was marked-to-market value and the resulting gain or loss was recorded in consolidated statement of operations as a “Gain / (loss) on derivative liability revaluation”. All the warrants mentioned in this section provide that if the Company issues or sells, enters into a definitive, binding agreement pursuant to which he Company is required to issue or sell or is deemed, pursuant to the provisions of the warrants, to have issued or sold, any shares of common stock for a price per share lower than the exercise price then in effect, subject to certain limited exceptions, then the exercise price of the warrants shall be reduced to such lower price per share. In addition, the exercise price and the number of shares of common stock issuable upon exercise of the warrants are subject to adjustment in connection with stock splits, dividends or distributions or other similar transactions. Other derivative liabilities Other derivative liabilities recognized and remeasured subsequently at fair value include: embedded derivatives issued with convertible notes (primarily, conversion option), and preferred stock that failed equity presentation when the Company had insufficient number of authorized shares available to settle all potential future conversion transactions, automatic increase in interest rate upon an event of default, and optional conversion feature that were not clearly and closely related to the economic characteristics and risks of a debt host. These derivative liabilities were initially recognized on November 15, 2022, when the Company entered into Amendment No. 3 to the Series D SPA (see Note 7 Qiantu Warrants On March 14, 2023, the Company entered into an Intellectual Property and Distribution Agreement (the “IP Agreement”) with Qiantu Motor (Suzhou) Ltd., and two of Qiantu Suzhou’s affiliates (herein “Qiantu”). Pursuant to the IP Agreement, Qiantu granted the Company the exclusive license to use certain of Qiantu’s trademarks and the exclusive right to assemble, manufacture, and sell the homologated vehicles based on the Qiantu K-50 model throughout North America and South America for a period of five years (see Note 19 As a part of consideration for the Company’s entry into the IP Agreement, the Company issued to Qiantu USA warrants to purchase up to 3,334 (giving effect to the reverse stock splits, see Note 1 The Qiantu warrants, per contract, are exercisable at Qiantu USA’s discretion at any time from September 30, 2023 up to and including September 30, 2024 at 110% of the market price of the Company’s common stock at the close of trading on the earlier of (a) when the Company completes its obligations to its Series D Preferred Stock investors; or (b) June 15, 2023, so their exercise price is $234 (giving effect to the reverse stock splits). The Qiantu Warrants have anti-dilution provisions similar to those described above, but they provide for exemption for Series D Preferred Stock transactions rights and obligations that existed on the date the Qiantu Warrants were issued. As it was expected that the Company may not have a sufficient number of authorized shares of common stock available for issuance during the term of the contract (up to September 2024), and the shares to be issued upon possible exercise of warrants have not been registered, the Qiantu Warrants were recognized at fair value on inception ($6,814,000) and on each subsequent period end. Due to decline in market price of shares the fair value of Qiantu Warrants on September 30, 2023 decreased to $124,133. The difference has been recognized within gains (losses) on derivative liabilities revaluation in the consolidated statements of operations. Upon issuance and upon revaluation of the instruments, the Company estimated the fair value of these derivatives using the Black-Scholes Pricing Model and binomial option valuation techniques based on the following assumptions: (1) dividend yield of 0% , (2) expected annualized volatility of 198 - 222% , and (3) risk-free interest rate of 4.3% to 4.7% . These liabilities are classified as having significant unobservable inputs (level 3) in the table below. Breakdown of items recorded at fair value on a recurring basis in consolidated balance sheets by levels of observable and unobservable inputs as of September 30, 2023 and on September 30, 2022 is presented below: September 30, Quoted Prices Significant Significant 2023 in Active Other Unobservable Markets for Observable Inputs Identical Assets Inputs (Level 3) (Level 1) (Level 2) Derivative liability $ 64,863,309 $ - $ 64,739,175 $ 124,134 September 30, Quoted Prices Significant Significant 2022 in Active Other Unobservable Markets for Observable Inputs Identical Assets Inputs (Level 3) (Level 1) (Level 2) Derivative liability $ 84,799,179 $ - $ 84,799,179 $ - A summary of all changes in warrants and other derivative liabilities is presented below: Balance, September 30, 2022 $ 84,799,179 Derivative liabilities recognized upon issuance of convertible instruments 501,073,872 Derivative liability recognized upon authorized shares shortfall 11,978,166 Loss / (gain) on derivative liability revaluation 116,256,211 Reclassification of derivative liabilities to equity (47,818,882) Financing loss upon over-issuance of shares from warrants 8,934,892 Receivables upon over-issuance of shares from warrants 17,721,868 Conversions of warrants into shares of common stock (628,081,997) Balance, September 30, 2023 $ 64,863,309 Balance, September 30, 2021 $ — Derivative liabilities recognized upon issuance of convertible instruments 484,421,258 Loss / (gain) on derivative liability revaluation 122,803,715 Conversions of warrants into shares of common stock (555,161,139) Change in agreement with warrant holders (recognized as deemed dividends) 32,735,345 Balance, September 30, 2022 $ 84,799,179 |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 12 Months Ended |
Sep. 30, 2023 | |
STOCKHOLDERS' EQUITY | |
STOCKHOLDERS' EQUITY | NOTE 9 – STOCKHOLDERS’ EQUITY Common Stock At a special meeting on January 25, 2023, stockholders approved the proposal to increase the Company’s authorized common stock capital from 1.75 billion to 5 billion shares. At September 30, 2023, the Company had 5,000,000,000 shares of common stock authorized with $0.001 par value per share. As described in detail in the Note 1 issued outstanding On July 6, 2023, the Board of the Company authorized a stock buyback program, pursuant to which the Company could, until December 31, 2023, purchase up to $25 million in shares of its outstanding common stock. The shares may be repurchased, from time to time, in the open market or in privately negotiated transactions depending upon market conditions and other factors, and in accordance with applicable regulations of the Securities and Exchange Commission. The authorization of the stock buyback program did not obligate the Company to purchase any shares and may be terminated or amended by the Board at any time prior to its expiration date. Up to September 30, 2023, the Company has purchased through a broker from unrelated parties, on an open market, 57,000 shares of common stock at prices ($99.7 and $98.5 giving effect to 1 The holders of common stock are entitled to one vote for each share of common stock held at all meetings of stockholders. In the event of a liquidation, dissolution or winding up of the Company, whether voluntary or involuntary, the common stockholders are entitled to receive the remaining assets following distribution of liquidation preferences, if any, to the holders of our preferred stock. The holders of common stock are not entitled to receive dividends unless declared by our Board. To date, no dividends were declared or paid to the holders of common stock. When the Company receives a warrant exercise notice or preferred stock conversion notice close to the balance sheet date, and issues relevant order to a transfer agent which is effectively exercised only after the balance sheet date, relevant shares of common stock are presented in the balance sheet as common stock owed but not issued. Change in Control Agreements On August 11, 2023, the Board of Directors approved, and the Company entered, Change in Control Agreements with each non-employee director and Chief Executive Officer. Pursuant to the Change in Control Agreements with each non-employee director, upon a change in control of the Company, any unvested equity compensation will immediately vest in full and such non-employee director will receive $5 million. Pursuant to the Agreement with CEO, upon a change in control of the Company, any unvested equity compensation will immediately vest in full and CEO will receive an aggregate percentage of the transaction proceeds as follows: 10% of the transaction proceeds that are up to and including $1 billion; plus an additional 5% of transaction proceeds that are more than $1 billion and up to $1.5 billion; and an additional 5% of transaction proceeds that are more than $1.5 billion. A change in control, as defined in the agreements occurs upon (i) any person becoming the beneficial owner of 50% or more of the total voting power of the Company’s then outstanding voting securities, (ii) a change in the composition of the Board, as a result of which fewer than a majority of the directors are Incumbent Directors (as defined in the Change in Control Agreements), or (iii) the consummation of a merger or consolidation of the Company (except when the total voting power of the Company continues to represent at least 50% of the surviving entity), any liquidation, or the sale or disposition by the Company of all or substantially all of its assets. Preferred Stock Under the terms of our Certificate of Incorporation, the Board may determine the rights, preferences, and terms of our authorized but unissued shares of Preferred Stock. On September 30, 2023, the Company had 500,000,000 shares of Preferred Stock authorized with $0.001 par value per share. The reverse stock splits (see Note 1 The Company has designated Series A Preferred Stock, Series B Preferred Stock, Series C Preferred Stock, and Series D Preferred Stock, with transactions over the last two years presented below: Preferred Stock Preferred Stock Series A Series B Series C Series D Total Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Balance, October 1, 2022 100,363 100 5,567,319 5,568 — — — — 5,667,682 5,668 Issuance of common stock for conversion of preferred stock (98,439) (98) (5,567,319) (5,568) (13,766,058) (13,766) (75,567,273) (75,568) (94,999,089) (95,000) Preferred shares issued for cash — — — — 12,212,450 12,212 79,926,925 79,927 92,139,375 92,139 Preferred shares issued in exchange for conversion of debt — — — — 2,829,029 2,829 — — 2,829,029 2,829 Preferred shares issued to settle liability to issue — — — — 84,900 85 — — 84,900 85 Balance, September 30, 2022 1,924 2 — — 1,360,321 1,360 4,359,652 4,359 5,721,897 5,721 Issuance of preferred stock, common stock and — — — — — — 273,363,635 273,364 273,363,635 273,364 prefunded warrants in lieu of preferred stock Issuance of common stock for conversion of preferred stock and dividends (1,276) (1) — — (148,564) (148) (277,360,190) (277,360) (277,510,030) (277,509) Balance, September 30, 2023 648 1 — — 1,211,757 1,212 363,097 363 1,575,502 1,576 Redemption Rights The shares of Preferred Stock are not subject to mandatory redemption. The Series C and Series D Preferred Stock are voluntarily redeemable by the Company in accordance with the following schedule, provided that the issuance of shares of common stock issuable upon conversion has been registered and the registration statement remains effective: Year 1: No Redemption Year 2: Redemption at 120% of Year 3: Redemption at 115% of Year 4: Redemption at 110% of Year 5: Redemption at 105% of Year 6 and thereafter: Redemption at 100% of The Series C and Series D Preferred Stock are also redeemable by the Company at any time for a price per share equal to the Issue Price ($8.84 for Series C Preferred Stock and $0.4379 for remaining Series D Preferred Stock), plus all unpaid accrued and accumulated dividends on such share (whether or not declared), provided: (A) the Preferred Stock has been issued and outstanding for a period of at least one year, (B) the issuance of the shares of common stock underlying the Preferred Stock has been registered pursuant to the Securities Act and such registration remains effective, and (C) the trading price for the common stock is less than the Conversion Price for 20 trading days in any period of 30 consecutive trading days on the Nasdaq Capital Market. Dividends The holders of Series A and Series B Preferred Stock are entitled to non-cumulative dividends if declared by the Board of Directors. The holders of the Series A Preferred Stock and Series B Preferred Stock participate on a pro rata basis (on an “as converted” basis to common stock) in any cash dividend paid on common stock. No dividends have been declared or paid during years ended September 30, 2023, and 2022 The Series C Preferred Stock originally provided for a cumulative 15.0% per annum fixed dividend on the Series C Original Issue Price plus unpaid accrued and accumulated dividends. On January 13, 2023, the Company and holders of Series C Preferred Stock entered into a waiver agreement pursuant to which such holders irrevocably waived their right to receive any and all cumulative 15.0% per annum fixed dividends on such Preferred Stock, including all unpaid accrued and accumulated dividends. As a result, an The Series D Preferred Stock bears a 15.0% per annum fixed dividend accumulated and compounded monthly, payable no later than the 5 th The Company may elect to pay dividends for any month with a payment-in-kind (“PIK”) election if (i) the shares issuable further to the PIK are subject to an effective registration statement, (ii) the Company is then in compliance with all listing requirements of NASDAQ and (iii) the average daily trading dollar volume of the Company’s common stock for 10 trading days in any period of 20 consecutive trading days on the NASDAQ is equal to or greater than $27.5 million. Liquidation, Dissolution, and Winding Up In the event of any Liquidation Event, the holders of the Series D Preferred Stock will be entitled to receive, prior and in preference to any distribution of the proceeds to the holders of the other series of Preferred Stock or the common stock by reason of their ownership thereof, an amount per share equal to the Series D Original Issue Price ($0.4379 per share in respect of the outstanding Series D Preferred Stock) plus declared but unpaid dividends (none declared but unpaid dividends on September 30, 2023 and 2022). In the event of any Liquidation Event, the holders of the Series B Preferred Stock will be entitled to receive, after full execution of rights of the Series D Preferred Stock holders, and prior and in preference to any distribution of the proceeds to the holders of the other series of Preferred Stock or the common stock by reason of their ownership thereof, an amount per share equal to the Series B Original Issue Price plus declared but unpaid dividends (none declared but unpaid dividends on September 30, 2023 and 2022). Upon the completion of a distribution pursuant to a Liquidation Event to the Series D Preferred Stock and Series B Preferred Stock, the holders of the Series C Preferred Stock will be entitled to receive, prior and in preference to any distribution of the proceeds to the holders of the Series A Preferred Stock or the common stock by reason of their ownership thereof, an amount per share equal to the Series C Original Issue Price ($8.84 per share) plus declared but unpaid dividends (none declared but unpaid dividends on September 30, 2023 and 2022). Upon the completion of a distribution pursuant to a Liquidation Event to the Series D Preferred Stock, Series B Preferred Stock and Series C Preferred Stock, the holders of Series A Preferred Stock are entitled to receive, prior and in preference to any distribution of any proceeds to the holders of the common stock, by reason of their ownership thereof, $1.29 per share of each share of the Series A Preferred Stock, plus declared but unpaid dividends on such share (none declared but unpaid dividends on September 30, 2023 and 2022). “Liquidation Event” is as defined in the Certificate of Incorporation and, subject to certain exceptions, includes a sale or other disposition of all or substantially all of the Company’s assets, certain mergers, consolidations and transfers of securities, and any liquidation, dissolution or winding up of the Company. Conversion Each share of Series A Preferred Stock is convertible at any time at the option of the holder into 0.0044 (giving effect to the reverse stock splits – see Note 1 Each share of Series B Preferred Stock and each share of Series C Preferred Stock are convertible at the option of the holder at any time into such number of shares of common stock as is determined by dividing the Issue Price by the relevant Conversion Price (in each case, subject to adjustment). As of September 30, 2023, there were no shares of Series B Preferred Stock issued and outstanding Note 1 Each share of Series C Preferred Stock will automatically be converted into shares of common stock at the applicable conversion rate at the time in effect immediately upon (A) the issuance of shares of common stock underlying the Series C Preferred Stock being registered pursuant to the Securities Act of 1933 and such registration remaining effective, (B) the trading price for the Company’s common stock being more than two times the Series C Conversion Price for 20 trading days in any period of 30 consecutive trading days on the Nasdaq Capital Market, and (C) the average daily trading dollar volume of the Company’s common stock during such 20 trading days is equal to or greater than $4.0 million. The Series D Preferred Stock is convertible at the option of each holder at any time into the number of shares of common stock determined by dividing the Series D Original Issue Price (plus all unpaid accrued and accumulated dividends thereon, as applicable, whether or not declared), by the Series D Conversion Price, subject to adjustment as set in the Certificate of Designation. As of September 30, 2023, each share of Series D is convertible into 0.000044 (giving effect to the reverse stock split – see Note 1 Each share of Series D Preferred Stock will automatically be converted into shares of common stock at the applicable Conversion Rate at the time in effect immediately upon (A) the issuance of shares of common stock underlying the Series D Preferred Stock being registered pursuant to the Securities Act and such registration remaining effective, (B) the trading price for the Company’s common stock being more than two times the Series D Conversion Price for 20 trading days in any period of 30 consecutive trading days on the Nasdaq Capital Market, and (C) the average daily trading dollar volume of the Company’s common stock during such 20 trading days is equal to or greater than $27.5 million. Voting Rights The holders of shares of common stock and Series A, Series B and Series C Preferred Stock at all times vote together as a single class on all matters (including the election of directors) submitted to a vote of the stockholders; provided, however, that, any proposal which adversely affects the rights, preferences and privileges of the Series A Preferred Stock, Series B Preferred Stock, or Series C Preferred Stock, as applicable, must be approved by a majority in interest of the affected series of Preferred Stock, as the case may be. Each holder of common stock, Series B Preferred and Series C Preferred has right to one vote for each share of common stock into which such Series B Preferred Stock and/or Series C Preferred Stock, as applicable, could be converted. Each holder of Series A Preferred has the right to 1,000 votes per share held of record by such holder (this right will terminate on November 5, 2024). The holders of Series D Preferred Stock have no voting rights except for protective voting rights (one vote for each share of common stock into which such Series D Preferred Stock could be converted) in such cases as approval of a liquidation event, authorization of issue of securities having a preference over or parity with the Series D Preferred Stock with respect to dividends, liquidation, redemption or voting, entering a merger or consolidation, etc. |
LOSS PER SHARE
LOSS PER SHARE | 12 Months Ended |
Sep. 30, 2023 | |
LOSS PER SHARE | |
LOSS PER SHARE | NOTE 10 – LOSS PER SHARE Earnings per common share (“EPS”) is computed by dividing net income allocated to common stockholders by the weighted-average shares of common stock outstanding. Diluted EPS is computed by dividing income allocated to common stockholders plus dividends on dilutive convertible preferred stock and preferred stock that can be tendered to exercise warrants, by the weighted-average shares of common stock outstanding plus amounts representing the dilutive effect of outstanding warrants and the dilution resulting from the conversion of convertible preferred stock, if applicable. For the fiscal years ended September 30, 2023 and 2022, outstanding warrants, convertible debt and shares of Preferred Stock were excluded from the diluted share count because the result would have been antidilutive under the “if-converted method.” The following table presents the reconciliation of net loss attributable to common stockholders to net loss used in computing basic and diluted net income per share of common stock (giving effect to the reverse stock splits – see Note 1 Fiscal Year ended September 30, 2023 2022 Net loss attributable to common stockholders $ (972,254,582) $ (739,532,806) Waived/(Accrued) accumulated preferred dividends 7,360,397 (40,516,440) Net loss used in computing basic net loss per share of common stock $ (964,894,185) $ (780,049,246) Net loss per share $ (1,574.14) $ (63,085.26) Weighted average shares outstanding, basic and diluted 612,964 12,365 |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 12 Months Ended |
Sep. 30, 2023 | |
SHARE-BASED COMPENSATION | |
SHARE-BASED COMPENSATION | NOTE 11 –SHARE- BASED COMPENSATION The Company has share incentive plans that are a part of annual discretionary share-based compensation program. The plans include consultants and employees, directors and officers. The Company has been issuing new shares of common stock under the share-based compensation programs, and cash has not been used to settle equity instruments granted under share-based payment arrangements. The remaining number of shares reserved for awards equity instruments under the Equity Incentives Plan to both employees and consultants on September 30, 2023 is 42,234,250 shares of common stock. For the fiscal year ended September 30, Composition of Stock-Based Compensation Expense 2023 2022 Directors, officers and employees share-based compensation $ 63,748,809 $ 19,471,496 Share-based compensation to consultants (equity-classified) 7,553,487 23,937,976 Share-based compensation to consultants (liability-classified) 14,139,573 330,220 Total share-based compensation expense $ 85,441,869 $ 43,739,692 Employees of the Company Employees of the Company, including officers, are entitled to a number of shares of common stock specified in relevant employment contracts and subject to the approval of our Board of Directors Compensation Committee. The total expense of share awards to employees represents the grant date fair value of relevant number of shares to be issued and is recognized, along with additional paid-in capital, ratably over the service period. Awards to the majority of employees vest on the first or the second employment anniversary of the employee - the weighted average vesting period is 14 months. Total remaining unrecognized compensation costs related to nonvested awards to these employees amount to $0.2 million. The weighted-average period over which these costs are expected to be recognized is 6 months. The liability that relates to liability classified stock-based compensation contracts amounts to $75,000 on September 30, 2023. Awards granted to employees: one time issuance on employment anniversary Number of shares Weighted average grant date fair value of shares Nonvested at the beginning of the year 35 $ 42,416 Granted during the year 1,021 $ 376 Vested during the year (30) $ 43,287 Forfeited during the year (61) $ 2,081 Nonvested at the end of the year 965 $ 456 Several members of management and officers are entitled to the same number of common stock specified in their employment contracts on every anniversary as long as they continue to serve. The grant fair value in this case is also based on the employment date. Therefore, these annual stock-based compensation costs are fixed throughout the employment period of each employee, unless modified subsequently. Total stock-based compensation costs of this type amounted to $6.0 million in the year ended September 30, 2023, and will amount to $5.8 million in each subsequent year unless entitled employees change or their contracts are modified. Awards granted to management: issuances on every employment anniversary (*) Number of shares Weighted average grant date fair value of shares Nonvested at the beginning of the year 100 $ 79,616 Granted during the year 100 $ 79,616 Vested during the year (100) $ 79,616 Forfeited during the year (13) $ 159,525 Nonvested at the end of the year 87 $ 67,353 (*) Information is presented for a 12-month period, see comments above. Consultants From time to time the Company also issues share-based compensation to external consultants providing consulting, marketing, R&D, legal and other services. The weighted average term of such contracts is 5 months. The number of shares specified within the individual agreements, or a monetary value of those shares, if applicable, is usually negotiated by our Chief Executive Officer and approved by the Board. These costs are generally presented as professional fees within general and administrative, and certain qualifying costs may be presented as part of research and development expenses ($5.0 million in the year ended September 30, 2023, and none in the year ended September 30, 2022). A part of these share-based awards is classified as equity and accounted for similar to stock-based compensation to employees. Another part of the Company’s share-based awards to consultants is classified as liabilities: mainly if a number of shares a consultant is entitled to is predominantly based on monetary value fixed in the contract. An accrued part of liability in this case is revaluated each period based on market price of the shares of common stock of the Company, until sufficient number of shares is issued. There was no liability to consultants as at September 30, 2023. The Company generally practices prepayment for future services of the consultants by unrestricted shares of common stock – in this case a prepaid asset is recognized on the balance sheet and is amortized over the period the consultant is delivering their services to the Company. The amount of these prepaid costs amounted to $5.1 million as at September 30, 2023 and this amount represents the total unrecognized compensation cost related to nonvested share-based compensation arrangements granted under the Plan to non-employees. The weighted-average period over which these costs are expected to be recognized after the balance sheet date is 6 months. Awards granted to consultants: classified as equity Number of shares Weighted average grant date fair value of shares Nonvested at the beginning of the year 38 $ 14,400 Granted during the year 6,982 $ 862 Vested during the year (8,019) $ 761 Forfeited during the year - $ - Nonvested at the end of the year 1,000 $ 56 Prepaid in vested stock but not amortized by the end of the year 5,275 $ 128 Awards granted to consultants: classified as liability Number of shares Weighted average grant date fair value of shares Nonvested at the beginning of the year - $ - Granted during the year 102,928 $ 208 Vested during the year (102,928) $ 208 Forfeited during the year - $ - Nonvested at the end of the year - $ - Prepaid in vested stock but not amortized by the end of the year 51,002 $ 87 CEO Award Incentive Plans The Company adopted the CEO Performance Stock Award Agreement, approved by the Board and by stockholders in 2022 (“2022 PSA Agreement”) and CEO Performance Stock Award Agreement, approved by the Board and by stockholders in 2023 (“2023 PSA Agreement”). Under these plans, the Chief Executive Officer is entitled to share-based awards generally calculated as 1-3% of then outstanding number of shares of common stock, issuable upon achievement of specific financial and operational targets (milestones) that are supposed to significantly increase value of the Company. This share-based compensation is accrued over the service term when it is probable that the milestone will be achieved. The liability to issue stock (presented within non-current liabilities if the achievement is expected later than 12 months after the balance sheet date) is revalued on every balance sheet date based on the length of the service period, current market price of the common stock, and on the number of shares of common stock outstanding – until the shares have been issued, or until fulfilling of the milestone requirements is no longer probable. The milestones per 2022 PSA Agreement: ● Vehicle Delivery Milestones : For each of the following five vehicle delivery milestone that is satisfied within the performance period specified, the Company will issue to Mr. Michery a number of shares of common stock equal to 2% of the Company’s then-current total issued and outstanding shares of common stock: (i) Delivery of the Company’s Class One Van to customers for a pilot program under the captured fleet exemption by the end of December 2022; (ii) Procuring full USA certification and homologation (or vehicle approval process) for the sale and delivery of its Class One Van by end of August 2023 (expired by September 30, 2023); (iii) Full USA certification and homologation of the Dragonfly RS sports car by August 2024 (not considered probable by September 30, 2023); (iv) Producing a drivable prototype of its Mullen 5 vehicle for consumers to test by end of October 2023; and (v) Producing a drivable prototype of its Mullen 5 RS High Performance vehicle for consumers to test by end of January 2023 (expired by September 30, 2023) . On October 3, 2022, the Company delivered its Class One Van to Hotwire Communications, a South Florida-based telecommunications company and Internet Service Provider for a pilot program under the captured fleet exemption. On August 20, 2023, a drivable porotype of the Mullen 5 vehicle was part of the Mullen road tour and available for consumers to test drive. ● Capital Benchmark Milestones : For each $100 million raised (a “Capital Tranche”), and subject to an aggregate maximum of raised of $1.0 billion in equity or debt financing between the date of the award agreement and the end of July 2024, the Company will issue a number of shares of common stock equal to 1% , of the Company’s then-current total issued and outstanding shares of common stock; as of the date a Capital Tranche is achieved. Additionally, if the Company is included in the Russell Index, the Company will issue to Mr. Michery a number of shares of common stock equal to 2% of Mullen’s then-current total issued and outstanding shares as of the date the Company is approved to be included on the Russell Index. On June 7, 2022, the Company entered into a Securities Purchase Agreement which, along with subsequent amendments, allowed the Company to raise more than $400 million to date through the issuance of preferred stock, prefunded warrants and common stock in lieu of preferred stock and other warrants. As at September 30, 2022, reaching the next 2 financial milestones (raising more than $500 and $600 million) was also considered probable. On June 27, 2022, the Company joined the Russell 2000 and 3000 Indexes. ● Feature Milestone : If Mullen enters into an agreement with a manufacturer or provider of equipment, accessory, feature or other product (collectively, “Feature”) by the end of 2023 that sets the Company or its vehicle apart from its competitors or that provides the Company a first mover or first disclosure advantage over its competitors for the Feature, the Company will issue to Mr. Michery a number of shares of common stock equal to 5% of the Company’s then-current total issued and outstanding shares of common stock as of the date the Feature milestone is achieved. On September 1, 2022, the Company announced that it a signed partnership with Watergen Inc. to develop and equip Mullen’s portfolio of electric vehicles with technology that will produce fresh drinking water from the air for in-vehicle consumer and commercial application. On October 12, 2022, the Company entered into the Distributorship Agreement whereby Watergen will be integrating its unique atmospheric water generating and dehumidifying technology into the Company’s vehicles and granting exclusivity to the Company for the integration design developed specifically for its vehicles. ● Distribution Milestone : For each vehicle distribution milestone set forth below that is satisfied by entering into a joint venture or other distribution agreement by December 31, 2024, the Company will issue to Mr. Michery a number of shares of common stock equal to 2% of Mullen’s then-current total issued and outstanding shares of common stock for each distribution milestone achieved: (i) agreement with an established local, US dealer or franchise network; and (ii) agreement with an established Latin American or other non-US based dealer or franchise network. On November 8, 2022, the Company entered into an agreement into an agreement to appoint Newgate Motor Group as the marketing, sales, distribution and servicing agent for the Mullen I-GO in Ireland and the United Kingdom. On December 12, 2022, the Company entered into a Dealer Agreement with Randy Marion Isuzu, a large USA dealer, to purchase and distribute the Company’s vehicles. The milestones per 2023 PSA Agreement: (In accordance with management’s assessment, all milestones per 2023 PSA Agreement as at September 30, 2023 are considered probable and one (Accelerated Development Milestone) has been achieved). ● Vehicle Completion Milestones : For each vehicle completion Milestone set forth below that is satisfied within the performance period specified, the Company will issue to Mr. Michery a number of shares of common stock equal to 3% of Mullen’s then-current total issued and outstanding shares of common stock: (i) Procuring full USA certification and homologation of its Class Three Van by end of December 2023; (ii) Full USA certification and homologation of the Bollinger B1 SUV by end of June 2025; and (iii) Full USA certification and homologation of the Bollinger B2 truck by end of June 2025. ● Revenue Benchmark Milestones : For each $ 25 Million of revenue recognized by the Company (each a “Revenue Tranche”), and subject to an aggregate maximum of recognized revenue of $ 250 Million between the date of grant and the end of December 2025, the Company will issue to Mr. Michery a number of shares of common stock equal to 1% of Mullen’s then-current total issued and outstanding shares of common stock as of the date a Revenue Tranche is achieved. ● Battery Development Milestones : For each Battery Development Milestone set forth below that is satisfied within the performance period specified, the Company will issue to Mr. Michery a number of shares of common stock equal to 2% of Mullen’s then-current total issued and outstanding shares of common stock: (i) the Company either directly or in collaboration with a joint venture partner develops or produces new and more advanced battery cells by the end of December 2024; (ii) the Company either directly or in collaboration with a joint venture partner scales its battery cells in the USA to the vehicle pack level for the Mullen Class 1 vehicle by the end of December 2024; (iii) the Company either directly or in collaboration with a joint venture partner scales its battery cells in the USA to the vehicle pack level for the Mullen Class 3 vehicle by the end of December 2024. ● JV-Acquisition Milestones : If Mullen enters into a partnership, joint venture, purchase and sale agreement or similar transaction by the end of 2025 where the Company acquires a majority interest in an enterprise that manufacturers or provides vehicles, vehicle equipment, battery cells, accessories or other products beneficial to the Company, the Company will issue to Mr. Michery a number of shares of common stock equal to 3% of Mullen’s then-current total issued and outstanding shares of common stock as of date the JV-Acquisition Milestone is achieved. ● Accelerated Development Milestone : If Mullen acquires a facility with existing equipment that allows the Company to expedite scaling of battery pack production in the USA, the Company will issue to Mr. Michery a number of shares of common stock equal to 2% of Mullen’s then-current total issued and outstanding shares of common stock as of date the Accelerated Development Milestone is achieved. On September 6, 2023, the Company acquired the battery production assets of Romeo Power including intellectual property, machinery and equipment that allows the Company to expedite scaling of battery pack production in the USA. CEO Performance Award Table Date Tranche % of O/S Shares O/S Shares Issued Stock Price Stock 9/21/2022 PSA2022. Russell Index Tranche 2% 21,386 428 9,225 $ 3,945,799 10/12/2022 PSA2022. Features Milestone 5% 39,897 1,995 5,625 11,221,088 11/9/2022 PSA2022. Non-USA Distribution 2% 54,718 1,094 6,075 6,648,217 11/30/2022 PSA2022. Capital Benchmark (>$200 mln) 2% 63,923 1,278 4,500 5,753,090 12/16/2022 PSA2022. USA Distribution 2% 75,274 1,505 6,750 10,161,979 2/16/2023 PSA2022. Vehicle Delivery - Pilot 2% 37,079 742 7,650 5,673,024 6/13/2023 PSA2022. Capital Benchmark (>$300 mln) 1% 292,533 2,925 207 605,542 7/5/2023 PSA2022. Capital Benchmark (>$400 mln) 1% 714,863 7,149 53 378,877 10/10/2023 PSA2022. Vehicle Delivery - Mullen 5 2% 1,844,064 36,881 27 985,468 10/10/2023 PSA2023. Accelerated development milestone 2% 2,484,730 49,695 27 1,327,840 Total Shares Awarded 103,692 $ 46,700,924 As at September 30, 2023, the accrual for future awards under 2022 PSA Agreement amounted to approximately $2.6 million (including $1.7 million award for the milestone that has been achieved but the shares have not been issued on the year end yet). Out of all remaining 2022 PSA Agreement awards the only awards that are considered probable are capital benchmarks that provide for a 1% of outstanding common stock on every $100 million the Company raises. The costs recognized within the line item "Directors, Officers and Employees share-based compensation" in the table above represent both actual issuances of common stock under the PSA Agreements (16,689 shares with fair value of $40.4 million) and this provision for future achieved and probable awards. Total remaining compensation cost related to nonvested share-based compensation milestones granted under the Plans will depend on probability of the milestones achievement, market price of the shares at the day before the issuance date, and on the number of shares of common stock outstanding on the day a milestone is achieved. If market price and the number of shares of common stock outstanding on September 30, 2023 remain constant and all milestones considered probable are actually achieved, these remaining compensation cost would amount to $31.3 million; the weighted-average period over which these costs are expected to be recognized after the balance sheet date is 14 months. The remaining number of shares authorized for awards under the PSA Agreements on September 30, 2023 was 293,861 shares of common stock (giving effect to the reverse stock splits, see Note 1 |
ACCRUED EXPENSES AND OTHER CURR
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | 12 Months Ended |
Sep. 30, 2023 | |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | NOTE 12 – ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES September 30, 2023 September 30, 2022 Accrued Expenses and Other Liabilities Accrued expense - other $ 34,397,209 $ 3,529,384 IRS tax liability 2,849,346 1,744,707 Accrued payroll 2,406,650 534,782 Accrued interest 1,548,724 1,377,008 Total $ 41,201,929 $ 7,185,881 |
LIABILITY TO ISSUE STOCK
LIABILITY TO ISSUE STOCK | 12 Months Ended |
Sep. 30, 2023 | |
LIABILITY TO ISSUE STOCK | |
LIABILITY TO ISSUE STOCK | NOTE 13 - LIABILITY TO ISSUE STOCK The liability on September 30, 2023 (current liability in amount of $9.9 million and non-current liability in amount of $1.8 million) primarily represents CEO incentive award provision to be settled in shares of common stock upon achievement of specific targets, see Note 11 - Share Based Compensation |
PROPERTY, PLANT, AND EQUIPMENT,
PROPERTY, PLANT, AND EQUIPMENT, NET | 12 Months Ended |
Sep. 30, 2023 | |
PROPERTY, PLANT, AND EQUIPMENT, NET | |
PROPERTY, PLANT, AND EQUIPMENT, NET | NOTE 14 – PROPERTY, PLANT, AND EQUIPMENT, NET Property, plant, and equipment, net consists of the following: September 30, September 30, 2023 2022 Buildings $ 48,081,466 $ 7,659,121 Machinery and equipment 27,861,452 7,383,612 Land 3,040,303 647,576 Construction-in-progress 5,180,642 269,778 Other fixed assets 2,824,165 1,743,057 Total cost of assets excluding accumulated impairment 86,988,028 17,703,144 Less: accumulated depreciation (4,955,243) (2,899,428) Property, Plant, and Equipment, Net $ 82,032,785 $ 14,803,716 Due to unfavorable market conditions, decline of the market prices of the Company’s common stock, and budgeted performance misses compared to the budgets prepared previously, we have tested long-lived asset for recoverability. The test was performed on September 1, 2023 by independent professional appraisers using both discounted cash flow method and guideline public company method. The fair value of the property, plant, and equipment of the ELMS/Legacy Mullen segment (classified in Level 3 of the fair value hierarchy) was determined on a standalone basis utilizing the cost and market approaches to value. The assets of the Bollinger's segment (see Note 21 - Segment information Note 6 - Goodwill and intangible assets Depreciation expense related to property, plant, and equipment for the years ended September 30, 2023 and 2022 was $8,023,596 and $379,256, respectively. |
OTHER NON-CURRENT ASSETS
OTHER NON-CURRENT ASSETS | 12 Months Ended |
Sep. 30, 2023 | |
OTHER NON-CURRENT ASSETS | |
OTHER NONCURRENT ASSETS | NOTE 15 – OTHER NON-CURRENT ASSETS As discussed in the Note 14 September 30, 2023 September 30, 2022 Other Non-current Assets Other assets $ — $ 81,589 Show room vehicles — 2,982,986 Security deposits 960,502 281,056 Total Other Assets $ 960,502 $ 3,345,631 |
OPERATING EXPENSES
OPERATING EXPENSES | 12 Months Ended |
Sep. 30, 2023 | |
OPERATING EXPENSES | |
OPERATING EXPENSES | NOTE 16 – OPERATING EXPENSES General and Administrative Expenses consist of the following: Year ended September 30, 2023 2022 Professional fees $ 36,374,957 $ 46,224,690 Compensation to employees 94,140,300 13,714,669 Depreciation 9,786,011 966,940 Amortization 6,602,288 888,774 Lease 1,429,110 2,145,648 Settlements and penalties 36,196,538 1,134,707 Employee benefits 4,014,915 2,107,793 Utilities and office expense 4,620,425 511,899 Advertising and promotions 8,443,311 4,407,764 Taxes and licenses 442,279 (284,854) Repairs and maintenance 1,128,266 392,679 Executive expenses and directors' fees 699,133 482,455 Listing and regulatory fees 6,042,474 1,546,810 Outside labor — 352,201 Other 5,926,125 746,081 Total $ 215,846,132 $ 75,338,256 The main portions of the Professional fees and Compensation to employees relate to stock-based compensation issued to non-employees and employees, respectively, see Note 11 - Share Based Compensation Research and Development Research and Development expenses as of September 30, 2023 and 2022, were $77,387,336 and $21,650,840, respectively. Costs are expensed as incurred. Research and development expenses are primarily comprised of external fees and internal costs for engineering, homologation, prototyping costs and other expenses related to preparation to mass-production of electric vehicles such as Mullen Five EV, Mullen One EV cargo van, etc. |
LEASES
LEASES | 12 Months Ended |
Sep. 30, 2023 | |
LEASES | |
LEASES | NOTE 17 – LEASES We have entered into various operating lease agreements for certain offices, manufacturing and warehouse facilities, and corporate aircraft. Operating leases led to recognition of right-of-use assets, and current and noncurrent portion of lease liabilities, as appropriate. These right-of-use assets also include any lease payments made and initial direct costs incurred at lease commencement and exclude lease incentives. The lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. We have lease agreements which require payments for both lease and non-lease components and have elected to account for these as a single lease component. Certain leases provide for annual increases to lease payment based on an index or rate. We calculate the present value of future lease payments based on the index or at the lease commencement date for new leases. The table below presents information regarding our lease assets and liabilities. September 30, 2023 September 30, 2022 Assets: Operating lease right-of-use assets $ 5,249,417 $ 4,597,052 Liabilities: Operating lease liabilities, current (2,134,494) (1,428,474) Operating lease liabilities, non-current (3,566,922) (3,359,354) Total lease liabilities $ (5,701,416) $ (4,787,828) Weighted average remaining lease terms: Operating leases 3.98 years 2.63 years Weighted average discount rate: Operating leases 28 % 28 % Cash paid for amounts included in the measurement of lease liabilities for the fiscal year ended September 30, 2023, and 2022 $ 3,168,567 $ 1,751,680 Operating lease costs: For the fiscal year ended September 30, 2023 2022 Fixed lease cost $ 3,318,326 $ 1,718,424 Variable lease cost 250,499 496,914 Short-term lease cost — 164,690 Sublease income (362,126) (293,511) Total operating lease costs $ 3,206,699 $ 2,086,517 Operating Lease Commitments Our leases primarily consist of land, land and building, or equipment leases. Our lease obligations are based upon contractual minimum rates. Most leases provide that we pay taxes, maintenance, insurance and operating expenses applicable to the premises. The initial term for most real property leases is typically 1 to 3 years, with renewal options of 1 to 5 years, and may include rent escalation clauses. The following table reflects maturities of operating lease liabilities at September 30, 2023: Years ending September 30, 2024 $ 3,135,400 2025 2,639,884 2026 803,759 2027 584,468 2028 206,919 Thereafter 1,579,534 Total lease payments $ 8,949,964 Less: imputed interest (3,248,548) Present value of lease liabilities $ 5,701,416 |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Sep. 30, 2023 | |
INCOME TAXES | |
INCOME TAXES | NOTE 18 – INCOME TAXES The Company and its less than 100% owned subsidiaries are filing separate tax returns and we calculate the provision for income taxes by using a “separate return” method. Sec 174 deduction and R&D credits are calculated using consolidated tax return rules and allocated among its members. We record deferred income taxes using enacted tax laws and rates for the years in which the taxes are expected to be paid. Deferred income tax assets and liabilities are recorded based on the differences between the financial reporting and income tax bases of assets and liabilities. The components of loss before income taxes are $1,017,647,310 and $740,323,152, for the years ended September 30, 2023 and 2022, respectively. The Company's total provision (benefit) for income taxes consists of the following for the years ended September 30, 2023 and 2022, respectively: September 30, September 30, 2023 2022 Current Federal $ — $ — State 2,400 1,600 Total Current $ 2,400 $ 1,600 Deferred Federal $ (10,990,882) $ (280,552) State — — Total Deferred $ (10,990,882) $ (280,552) Total provision (benefit) for income taxes $ (10,988,482) $ (278,952) The following table represents accumulated income tax NOL (net operating loss) carryforwards for the years ended September 30, 2023 and 2022, respectively: September 30, September 30, 2023 2022 Federal 2034-2037 $ 29,838,716 $ 29,838,716 Indefinite 451,052,564 311,525,886 Total Federal $ 480,891,280 $ 341,364,602 California 2034-2040 $ 473,427,974 $ 318,862,714 Total California $ 473,427,974 $ 318,862,714 The reconciliation of our effective tax rate to the statutory federal rate of 21% for the years ended September 30, 2023 and 2022 is as follows: September 30, September 30, September 30, September 30, 2023 2023 - % 2022 2022 - % Income tax benefit at statutory rate $ (213,705,935) 21% $ (155,466,389) 21% State income taxes 2,400 0% 1,600 0% Permanent differences 155,268,652 (15)% 995,227 (0.13)% Valuation allowance 49,635,916 (5)% 154,180,328 (20.83)% Federal return to provision true up (2,269,617) 0% — 0% Other 80,102 0% 10,282 0% Total (benefit) provision for income taxes $ (10,988,482) 1% $ (278,952) 0.04% We record deferred income taxes using enacted tax laws and rates for the years in which the taxes are expected to be paid. Deferred income tax assets and liabilities are recorded based on the differences between the financial reporting and income tax bases of assets and liabilities. Significant components of the Company's net deferred tax assets as of September 30, 2023 and 2022, respectively, are as follows: 2023 2022 Deferred tax assets: Stock compensation $ 10,327,117 $ 8,442 Net operating loss carryforwards 118,886,728 78,791,906 Charitable contributions 2,680 1,219 Accrued expenses 414,745 86,926 Impairment other — — Other assets 413,579 426,099 Intangibles 48,382,778 163(j) limitation 15,971,671 14,522,536 Research expenditures 16,077,633 — Mark-to-market warrants — 121,545,414 Total gross deferred tax assets 162,094,153 263,765,320 R&D tax credits 7,353,043 578,842 Less valuation allowance (155,435,630) (258,903,457) Total net deferred tax assets 14,011,566 5,440,705 Deferred tax liabilities: Intangibles (16,358,329) (19,428,527) Fixed assets (1,545,473) (969,201) Other 336 (336) Total deferred tax liabilities (17,903,466) (20,398,064) Net deferred tax assets $ (3,891,900) $ (14,957,359) We maintain a full valuation allowance against the value of our deferred tax assets because based on the weight of evidence available at September 30, 2023 and 2022, it is more likely than not that deferred tax assets will not be realized. We follow the guidance for accounting for uncertainty in income taxes in accordance with FASB ASC 740, which clarifies uncertainty in income taxes recognized in an enterprise's financial statements. The standard also prescribes a recognition threshold and measurement standard for the financial statement recognition and measurement of an income tax position taken, or expected to be taken, in an income tax return. Only tax positions that meet the more likely than not recognition threshold may be recognized. In addition, the standard provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, and disclosure. The Company's tax years for 2014 through 2023 are still subject to examination by the tax authorities. |
CONTINGENCIES AND CLAIMS
CONTINGENCIES AND CLAIMS | 12 Months Ended |
Sep. 30, 2023 | |
CONTINGENCIES AND CLAIMS | |
CONTINGENCIES AND CLAIMS | NOTE 19 – CONTINGENCIES AND CLAIMS ASC 450.20 governs the disclosure and recognition of loss contingencies, including potential losses from litigation, regulation, tax and other matters. The accounting standard defines a “loss contingency” as “an existing condition, situation, or set of circumstances involving uncertainty as to possible loss to an entity that will ultimately be resolved when one or more future events occur or fail to occur.” ASC 450 requires accrual for a loss contingency when it is probable that one or more future events will occur confirming the fact of loss and the amount of the loss can be reasonably estimated. Under this standard an event is probable when it is likely to occur. From time to time, we are subject to asserted and actual claims and lawsuits arising in the ordinary course of business. Company management reviews any such legal proceedings and claims on an ongoing basis and follows appropriate accounting guidance when making accrual and disclosure decisions. We recognize accruals for those contingencies where the incurrence of a loss is probable and can be reasonably estimated, and disclose the amount accrued and the amount of a reasonably possible loss in excess of the amount accrued, if such disclosure is necessary for our consolidated financial statements to not be misleading. As required by ASC 450 we do not record liabilities when the likelihood is not probable, or when the likelihood is probable, but the amount cannot be reasonably estimated. To estimate whether a loss contingency should be accrued by a charge to income, management evaluates, among other factors, the degree of probability of an unfavorable outcome and the ability to make a reasonable estimate of the amount of the loss. The outcomes of our legal proceedings and other contingencies are inherently unpredictable, subject to significant uncertainties, and could be material to our operating results and cash flows for a particular period. We evaluate, at least quarterly, developments in our legal proceedings and other contingencies that could affect the amount of liability, including amounts in excess of any previous accruals and reasonably possible losses disclosed, and make adjustments and changes to our accruals and disclosures as appropriate. For the matters we disclose that do not include an estimate of the amount of loss or range of losses, such an estimate is not possible or is immaterial, and we may be unable to estimate the possible loss or range of losses that could potentially result from the application of non-monetary remedies. Until the final resolution of such matters, if any of our estimates and assumptions change or prove to have been incorrect, we may experience losses in excess of the amounts recorded, which could have a material effect on our business, consolidated financial position, results of operations, or cash flows. Qiantu Motor (Suzhou) Ltd. This matter arises out of a contract dispute between Mullen and Qiantu Motor (Suzhou) Ltd. (“Qiantu”) related to the engineering, design, support, and homologation of Qiantu’s K50 vehicle by Mullen. On March 14, 2023, the parties entered into a Settlement Agreement providing for full settlement of all pending litigation between Mullen and Qiantu. The parties also released all claims against each other arising from or in connection with the matters and claims that were subject to the legal proceedings. Pursuant to the Settlement Agreement, (1) the parties agreed to enter into an IP Agreement (as defined and described below) and (2) in connection with the settlement of the Legal Proceedings and for the privilege of entering into the IP Agreement, the Mullen paid $6 million to Qiantu. In connection with the execution of the Settlement Agreement, on March 14, 2023, Mullen entered into an Intellectual Property and Distribution Agreement ( “IP Agreement”) with Qiantu, and two of Qiantu’s affiliates (collectively “Qiantu”). Pursuant to the IP Agreement, Qiantu granted Mullen the exclusive license to use certain of Qiantu’s trademarks and the exclusive right to assemble, manufacture, and sell the homologated vehicles based on the Qiantu K-50 model throughout North America (including Canada, Mexico, and the United States of America) and South America for a period of five Five As consideration for Mullen’s entry into the IP Agreement, (1) Mullen issued to Qiantu USA warrants to purchase up to 3,334 shares of Mullen’s common stock (the “Qiantu Warrants”) as described below; (2) Mullen additionally paid Qiantu $2,000,000 for deliverable items under the IP Agreement; and (3) in exchange, Mullen will pay Qiantu a royalty fee of $1,200 for each homologated vehicle sold in North America and South America during the term of the IP Agreement. The Qiantu Warrants were issued upon execution of the IP Agreement and are exercisable at Qiantu USA’s discretion commencing at any time from September 30, 2023 up to and including September 30, 2024 at 110% of the market price of Mullen’s common stock at the close of trading on the earlier of (a) when Mullen completes its obligations to its Series D Preferred Stock investors; or (b) June 15, 2023 (for more information on these warrants, see Note 8 As Mullen continues analysis of the homologation costs, Mullen believes it would be in its best interest to also acquire licensing rights in additional territories. In that regard, Mullen is currently in negotiations with Qiantu for the licensing rights to the European territory. No loss contingencies have been accrued in respect of this matter as at September 30, 2023, other than those paid (see above) as the Company can reasonably estimate neither probability of additional losses, nor their magnitude (if any), based on all available information presently known to management. International Business Machines (“IBM”) This claim was filed in the Supreme Court of the State of New York on May 7, 2019. This matter arises out of a contract dispute between Mullen and IBM related to a joint development and technology license agreement, patent license agreement, and a logo trademark agreement. On November 9, 2021, the court, pursuant to an inquest order, awarded damages in favor of IBM and on December 1, 2021, the court entered a judgment in favor of IBM in the amount of $5,617,192. On February 2, 2022, IBM filed a Motion to Amend the Judgment it had obtained to add Mullen Automotive and Ottava as Judgment Debtors. Mullen filed an Appeal on April 8, 2022. A settlement was reached in which Mullen paid the full amount of the Judgment with interest, for a total of approximately $5,900,000, but maintained its Appeal rights. IBM then filed a Motion to Dismiss the Appeal based on Mullen’s payment of the Judgment. Mullen filed an Opposition to the same on July 18, 2022, and the hearing of the matter was set for July 25, 2022. The Court took the same under submission, and a decision has still not been issued. The Appeal remains pending. The Company has recognized the amounts paid ($5.9 million) as losses on settlement in the year ended September 30, 2022 and does not expect any additional losses to be reasonably possible. TOA Trading LLC Litigation This claim arises out of an alleged breach of contract related to an unpaid finder’s fee. On April 11, 2022, TOA Trading LLC and Munshibari LLC (“Plaintiffs”), filed a complaint against Mullen in the United States District Court for the Southern District of Florida. The Plaintiffs estimated the damages to be $15 million. On May 18, 2022, Mullen filed a Motion to Dismiss or in the Alternative, Transfer Venue. Plaintiffs filed their opposition on June 1, 2022 and Mullen filed its reply on June 8, 2022. The court took the Motion to Dismiss or in the Alternative, Transfer Venue under submission. Plaintiffs filed a Notification of Ninety Days Expiring on February 1, 2023 notifying the court that Mullen’s Motion to Dismiss or in the Alternative, Transfer Venue had been fully briefed for a period of time exceeding 90 days. On March 22, 2023, the Court issued a ruling denying Mullen’s Motion to Dismiss or in the Alternative, Transfer Venue. Accordingly, Mullen filed its Answer to Plaintiffs’ complaint on April 7, 2023. The Parties have completed written and oral discovery. Court mandated mediation took place on September 7, 2023, and was not successful. Mullen filed a Motion for Summary Judgment (“MSJ”) on October 6, 2023. The MSJ was fully submitted on November 3, 2023. Trial is set for February 12, 2024. Based on the early stage of the litigation, no loss contingencies have been accrued in respect of this matter as at September 30, 2023 as the Company can reasonably estimate neither probability of the loss, nor their magnitude (if any), based on all available information presently known to management. DBI Lease Buyback Servicing LLC, Drawbridge Investments LLC In June 2022, Mullen entered into a letter agreement with DBI Lease Buyback Servicing LLC (“DBI”) wherein it agreed to provide DBI with a right to purchase up to $25 million worth of a to-be-issued Series E Convertible Preferred Stock and warrants. The option and its terms have not been finalized. On March 2, 2023, DBI and Drawbridge Investments LLC (collectively, “Drawbridge”) filed a complaint in the Commercial Division of the Supreme Court of the State of New York, County of New York against Mullen. The complaint asserted three claims arising out of an alleged Series E option agreement by which Drawbridge allegedly would be able to purchase to-be-created Series E preferred shares and obtain warrants for Mullen’s common stock in exchange for, inter alia, a $3.5 million discount on a promissory note held by Drawbridge. Specifically, Drawbridge asserts claims for: (1) specific performance of the alleged agreement; (2) money damages (in an amount exceeding $100 million) arising out of Mullen’s alleged breach of the alleged agreement; and (3) declaratory judgment setting forth Drawbridge’s rights and Mullen’s obligations under the alleged agreement. Drawbridge commenced the action by Order to Show Cause (“OSC”) whereby it, inter alia, sought a temporary restraining order (“TRO”) (a) enjoining Mullen from (i) increasing the number of designated shares for any outstanding stock and (ii) issuing new preferred stock; and (b) requiring Mullen to maintain at least 500,000,000 in authorized common stock (post reverse splits). On March 14, 2023, the Court vacated the TRO and entered an Order on March 15, 2023 whereby the TRO was vacated and denied. At the April 18, 2023 hearing for the preliminary injunctive relief sought by Drawbridge in the OSC and after reviewing Mullen’s opposition and hearing oral argument from both sides, the Court reserved decision on Drawbridge’s motion. Mullen moved to dismiss the complaint, with prejudice, on May 9, 2023. The Motion to Dismiss (“MTD”) was fully submitted on or about June 27, 2023. By Order dated August 25, 2023 and entered on August 29, 2023, the Court granted Mullen’s MTD and denied Drawbridge’s motion for a preliminary injunction. On December 5, 2023, as part of the settlement, Drawbridge withdrew its appeal with prejudice. Based on the contract signed by the parties, the Company accrued $1.95 million as of September 30, 2023 in full and complete satisfaction of the claims. The GEM Group On September 21, 2021, the GEM Group filed an arbitration demand and statement of claim against Mullen seeking declaratory relief and damages. This matter arises out of an alleged breach of a securities purchase agreement dated November 13, 2020. On June 7, 2023, the arbitrator held oral argument on issues related to liability. The arbitrator has not yet issued his decision on issues related to liability. Briefing and oral argument on issues of damages, if necessary, will be scheduled after the arbitrator issues its decision on liability. On June 13, 2023, the GEM Group requested permission to file a motion for interim relief based on its belief that Mullen may not be able to satisfy its obligations should the arbitrator ultimately rule in the GEM Group’s favor. Despite Mullen’s objections, the arbitrator authorized the GEM Group to file an application. On July 12, 2023, the GEM Group filed an Application for Interim Award of Relief. Mullen filed its response on July 19, 2023. On August 3, 2023, the Arbitrator issued his Decision and Order on Application for Interim Measures requiring Mullen to deposit $7,000,000 into an interest-bearing escrow account with a commercial bank or brokerage firm. The arbitrator also ordered that all interest earned on the escrow account shall become the property of the party determined in the arbitration to be entitled to the principal and that the amounts held in escrow shall be released only upon further order of the arbitrator, a court or other tribunal of competent jurisdiction, or by agreement of the parties. On December 15, 2023, the GEM Group filed a motion seeking to have an additional $29,114,921.00 of cash placed in escrow considering the issuance of the Partial Award. Mullen filed an opposition to that request on December 29, 2023. To date, the arbitrator has not issued a decision on the GEM Group’s request. The Company has accrued $7 million as a probable settlement expense as of September 30, 2023. Based on the early stage of the litigation, it is not possible to reasonably estimate if exposure exceeds the amounts accrued. Mullen Stockholder Litigation Margaret Schaub v. Mullen Automotive Inc. On May 5, 2022, Plaintiff Margaret Schaub, a purported stockholder, filed a putative class action complaint in the United States District Court Central District of California against the “Company”, as well as its Chief Executive Officer, David Michery, and the Chief Executive Officer of a predecessor entity, Oleg Firer (the “Schaub Lawsuit”). This lawsuit was brought by Schaub both individually and on behalf of a putative class of the Company’s shareholders, claiming false or misleading statements regarding the Company’s business partnerships, technology, and manufacturing capabilities, and alleging violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (“Exchange Act”) and Rule 10b-5 promulgated thereunder. The Schaub Lawsuit seeks to certify a putative class of shareholders, and seeks monetary damages, as well as an award of reasonable fees and expenses. On August 4, 2022, the Court issued an order consolidating the Schaub Lawsuit with the later-filed Gru Lawsuit (discussed below), and appointing lead plaintiff and lead counsel. On September 23, 2022, Lead Plaintiff filed her Consolidated Amended Class Action Complaint (“Amended Complaint”) against the Company, Mr. Michery, and the Company’s predecessor, Mullen Technologies, Inc., premised on the same purported violations of the Exchange Act and Rule 10b-5, seeking to certify a putative class of shareholders, and seeking an award of monetary damages, as well as reasonable fees and expenses. Defendants filed their motion to dismiss the Amended Complaint on November 22, 2022. On September 28, 2023, the Court granted Defendants’ motion to dismiss, in part, and denied the motion to dismiss, in part. No loss contingencies have been accrued in respect of this matter as at September 30, 2023, as the Company can reasonably estimate neither probability of the loss, nor their magnitude (if any), based on all available information presently known to management. Trinon Coleman v. David Michery et al. On December 8, 2023, Trinon Coleman, a purported stockholder, filed a derivative action in the Court of Chancery for the State of Delaware against the Company as a nominal defendant, Mr. Michery, and Company directors Mr. Puckett, Ms. Winter, Mr. Betor, Mr. Miltner, and Mr. New (the “Coleman Lawsuit”). This lawsuit asserts claims for breach of fiduciary duty, insider trading, and unjust enrichment primarily in connection with the issues and claims asserted in the Schaub Lawsuit. The Coleman Lawsuit seeks to direct the Company to improve its corporate governance and internal procedures, and seeks monetary damages and an award of reasonable fees and expenses. No loss contingencies have been accrued in respect of this matter as at September 30, 2023, as the Company can reasonably estimate neither probability of the loss, nor their magnitude (if any), based on all available information presently known to management. David Gru v. Mullen Automotive Inc On May 12, 2022, David Gru, a purported stockholder, filed a putative class action lawsuit in the United States District Court for the Central District of California against Mullen Automotive Inc. (“Mullen”), Mr. Michery, and Mr. Firer (the “Gru Lawsuit”). This lawsuit was brought by Gru both individually and on behalf of a putative class of Mullen’s shareholders, claiming false or misleading statements regarding Mullen’s business partnerships, technology, and manufacturing capabilities, and alleging violations of Sections 10(b) and 20(a) of the Exchange Act and Rule 10b-5. The Gru Lawsuit sought to declare the action to be a class action, and sought monetary damages, pre-judgment and post-judgment interest, as well as an award of reasonable fees and expenses. On August 4, 2022, the Court consolidated this action into the Schaub Lawsuit, and ordered this action administratively closed. Jeff Witt v. Mullen Automotive Inc. On August 1, 2022, Jeff Witt and Joseph Birbigalia, purported stockholders, filed a derivative action in the United States District Court for the Central District of California against the Company as a nominal defendant, Mr. Michery, Mr. Firer, and current or former Company directors Ignacio Novoa, Mary Winter, Kent Puckett, Mark Betor, William Miltner and Jonathan New (the “Witt Lawsuit”). The Witt lawsuit asserts claims for breach of fiduciary duty, unjust enrichment, abuse of control, waste of corporate assets, and violation of Section 14 of the Exchange Act primarily in connection with the issues and claims asserted in the Schaub Lawsuit. The Witt Lawsuit seeks monetary damages, as well as an award of reasonable fees and expenses. On November 8, 2022, the Court consolidated this matter and the Morsy Lawsuit (see below) into one case, and on November 30, 2022 stayed the consolidated derivative action pending (1) dismissal of the consolidated securities class action (the Schaub Lawsuit discussed above), or (2) the filing of an answer in the consolidated securities class action and notice by any party that they no longer consent to the voluntary stay of this consolidated derivative action. The case currently remains stayed. No loss contingencies have been accrued in respect of this matter as at September 30, 2023, as the Company can reasonably estimate neither probability of the loss, nor their magnitude (if any), based on all available information presently known to management. Hany Morsy v. David Michery, et al. On September 30, 2022, Hany Morsy, a purported stockholder, filed a derivative action in the United States District Court for the Central District of California against the Company as a nominal defendant, Mr. Michery, Mr. Firer, former Company officer and director, Jerry Alban, and Company directors Mr. Novoa, Ms. Winter, Mr. Puckett, Mr. Betor, Mr. Miltner, and Mr. New (the “Morsy Lawsuit”). This lawsuit asserts claims for breach of fiduciary duty, abuse of control, gross mismanagement, waste of corporate assets, and violation of Section 14 of the Exchange Act primarily in connection with the issues and claims asserted in the Schaub Lawsuit. The Morsy Lawsuit seeks to direct the Company to improve its corporate governance and internal procedures, and also seeks monetary damages, pre-judgment and post-judgment interest, restitution, and an award of reasonable fees and expenses. On November 8, 2022, the Court consolidated this matter and the Witt Lawsuit (see above) into one case, and stayed the consolidated action (as discussed above). Chosten Caris v. David Michery On April 27, 2023, Chosten Caris, a purported stockholder, filed a complaint against Mr. Michery in the Eighth Judicial Circuit In and For Alachua County, Florida (the “Caris Lawsuit”). This lawsuit purports to seek damages for claims arising under Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder. The Caris Lawsuit also seeks punitive damages. On May 17, 2023, Mr. Michery removed the Caris Lawsuit to the United States District Court for the Northern District of Florida. Mr. Michery filed a Motion to Dismiss (“MTD”) the Caris Lawsuit on June 20, 2023. On July 21, 2023, Plaintiff filed a document entitled “Conclusion” and another entitled “Memorandum Summary.” The court, on July 25, 2023, entered an order in response to Plaintiff’s “Conclusion” advising that the document did not constitute a sufficient filing because it was not in the proper format, did not include a certificate of service, was not signed, and was not responsive to the MTD. The court additionally, expanded Plaintiff’s deadline to respond to the MTD from July 21, 2023 to August 8, 2023 and deferred its ruling on the MTD as a result of the extended filing deadline. On July 26, 2023, Plaintiff filed a document entitled “Plaintiff’s Demand” requesting certain relief from the court. The court, on July 28, 2023, issued an order denying “Plaintiff’s Demand”, advising that no action will be taken on Plaintiff’s July 21, 2023 “Memorandum Summary”, and further deferring a ruling on the MTD. Plaintiff filed his response to the MTD on August 3, 2023. No reply is permitted in this court. To date, the court has not issued an order with respect to the MTD. No loss contingencies have been accrued in respect of this matter as at September 30, 2023, as the Company can reasonably estimate neither probability of the loss, nor their magnitude (if any), based on all available information presently known to management. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Sep. 30, 2023 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | NOTE 20 – RELATED PARTY TRANSACTIONS Correction of Related Party Disclosures Subsequent to the issuance of the Company’s consolidated financial statements for fiscal year ended September 30, 2022, management was informed by the Company’s current independent auditor that it needed to provide additional disclosures pertaining to its advances to Mullen Technologies, Inc. (“MTI”) of approximately $1.2 million for fiscal year ended September 30, 2022, which were made under the Transition Services Agreement dated May 12, 2021 between the Company and MTI (the “TSA”). First, Note 19 to the consolidated financial statements for the year ended September 30, 2022 should have disclosed that the Company’s CEO was also the CEO, Board Chairman and controlling owner of MTI. As of September 30, 2022, approximately $1.2 million of the receivable from related party MTI was past due and outstanding. Second, Note 19 to the consolidated financial statements for fiscal year ended September 30, 2022, misdescribed the Company’s services to MTI as “management and accounting services at cost”. The proper disclosure should have been described as the processing and disbursement of payroll and related costs for 11 employees that provided services only to MTI, as well as the payment of rent for a facility utilized by MTI’s business during the fiscal year ended September 30, 2022. Pursuant to Article III of the TSA, MTI is obligated to pay monthly to the Company certain allocated costs, without mark-up, and covered taxes related to the services provided; however, such payments were not made to the Company during the year ended September 30, 2022. In addition, late monthly payments accrue interest at a rate per annum equal to the lower of the prime rate plus 1% or the maximum rate under applicable law. Interest on the unpaid receivable balance from related party MTI of approximately $0.1 million was not accrued and was not included in the September 30, 2022 balance of the receivable of approximately $1.2 million. In accordance with Staff Accounting bulletin (“SAB”) No. 99, “ Materiality Considering the Effects of Prior year Misstatements when Quantifying Misstatements in Current Year Financial Statements Related Party Note Receivable Prior to its spinoff as a separate entity and the closing of the Merger on November 5, 2021, the Company operated as a division of MTI, an entity in which the Company’s CEO had a controlling financial interest and of which he was CEO and Chairman during the fiscal years ended September 30, 2023 and 2022. Subsequent to the spinoff transaction and Merger on November 5, 2021, the Company processed and disbursed payroll and related compensation benefits for 11 employees that provided services only to MTI and rent costs for facilities utilized by MTI pursuant to the TSA. The terms of the TSA require MTI to repay monthly the amounts advanced by the Company, with the lower of the prime rate plus 1% or the maximum rate under applicable law charged on the unpaid amounts. The terms of the TSA do not provide for any other payment processing service fee from MTI to the Company except the interest fee on overdue advance balances. The Company incurred approximately $1.2 million and $0.9 million of disbursements on behalf of MTI during the years ended September 30, 2022 and 2023, respectively. No amounts have been collected for the funds advanced through September 30, 2023. On March 31, 2023, the Company converted approximately $1.4 million of these advances to MTI to a note receivable from MTI. The note bears interest at 10% per year and matures on March 31, 2025 with a default rate of 15% per annum. By the end of the 2023 fiscal year, the note principal has been increased by additional $0.4 million. Remaining advances, note and interest receivable as at September 30 2023 and 2022 are presented within non-current assets of the consolidated balance sheets. The following table summarizes the activity for the Company’s advances receivable from related party MTI: Advances Interest on advances Note Interest on note Total Balance, September 30, 2021 — — — — — Additions 1,232,387 — — — 1,232,387 Repayments — — — — — Balance, September 30, 2022 1,232,387 - - - 1,232,387 Additions 392,954 — 446,091 — 839,045 Conversion (1,388,405) — 1,388,405 — — Accrued interest — 91,030 — 88,027 179,057 Repayments — — — — — Balance, September 30, 2023 236,936 91,030 1,834,496 88,027 2,250,489 On January 16, 2023, the Company terminated the TSA with MTI, and received payment in full from MTI in settlement of all then receivable amounts outstanding (refer to Note 22 - Subsequent events Director Provided Services For the fiscal year ended September 30, 2023, our non-employee directors have earned compensation for service on our Board of Directors and Committees of our Board of Directors in amount of $287,000 in cash and $487,500 in shares of common stock. In addition, the following non-employee directors were engaged in certain other consulting contracts with the Company: William Miltner William Miltner is a litigation attorney who provides legal services to Mullen Automotive and its subsidiaries. Mr. Miltner also is an elected Director for the Company, beginning his term in August 2021. For the fiscal year ending September 30, 2023, Mr. Miltner received $1,058,105 for services rendered. Mr. Miltner has been providing legal services to us since 2020. Mary Winter On October 26, 2021, the Company entered into a consulting agreement with Mary Winter, Corporate Secretary and Director, to compensate for Corporate Secretary Services and director responsibilities for the period from October 1, 2021 to September 30, 2023, in the amount of $60,000 annually or $5,000 per month. As of September 30, 2023, Ms. Winter has received $60,000 in consulting payments. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 12 Months Ended |
Sep. 30, 2023 | |
SEGMENT INFORMATION | |
SEGMENT INFORMATION | NOTE 21 – SEGMENT INFORMATION Our CEO and Chairman of the Board, as the chief operating decision maker, makes decisions about resources to be acquired, allocated and utilized to each operating segment. The Company is currently comprised of 2 major operating segments: - Bollinger. The Company acquired the controlling interest of Bollinger Motors Inc. ( 60% ) on September 7, 2022. This acquisition positions Mullen into the medium duty truck classes 4-6, along with the Sport Utility and Pick Up Trucks EV segments. - Mullen/ELMS. By November 30, 2022, Mullen acquired ELMS’ manufacturing plant in Mishawaka Indiana and all the intellectual property needed to engineer and build Class 1 and Class 3 electric vehicles. All long-lived assets of the Company are located in the United States of America. All revenue presented in these consolidated financial statements relates to contracts with customers located in the United States of America. Segment reporting for the year ended September 30, 2023 Bollinger Mullen/ELMS Total Revenues (including $308,000 from one dealer) $ — $ 366,000 $ 366,000 Interest gains 1,585,376 684,367 2,269,743 Interest expenses (88,580) (4,904,560) (4,993,140) Depreciation and amortization expense (3,808,877) (12,579,422) (16,388,299) Impairment of goodwill (63,988,000) — (63,988,000) Impairment of property, plant, and equipment — (14,770,000) (14,770,000) Impairment of intangible assets — (5,873,000) (5,873,000) Income tax benefit/(expense) 10,990,882 (2,400) 10,988,482 Other significant noncash items: Stock-based compensation — (85,441,869) (85,441,869) Revaluation of derivative liabilities — (116,256,212) (116,256,212) Initial recognition of derivative liabilities — (513,052,038) (513,052,038) Non-cash financing loss on over-exercise of warrants — (8,934,892) (8,934,892) Loss on extinguishment of debt — (6,246,089) (6,246,089) Net loss $ (83,285,117) $ (923,373,711) $ (1,006,658,828) Total segment assets $ 169,410,298 $ 252,295,433 $ 421,705,730 Expenditures for segment's long-lived assets (property, plant, and equipment, and intangible assets) $ (4,677,421) $ (103,245,888) $ (107,923,309) Segment reporting for the year ended September 30, 2022 (*) Bollinger Mullen Total Revenues $ — $ — $ — Interest gains — — — Interest expenses — (26,949,081) (26,949,081) Depreciation and amortization expense (605,216) (2,677,069) (3,282,285) Other significant noncash items: Stock-based compensation — (43,715,242) (43,715,242) Revaluation of derivative liabilities — (122,803,715) (122,803,715) Initial recognition of derivative liabilities — (484,421,258) (484,421,258) Non-cash interest and other operating activities — (13,883,637) (13,883,637) Amortization of debt discount — (19,595,915) (19,595,915) Net loss $ (1,979,865) $ (738,344,887) $ (740,324,752) Segment assets $ 230,498,634 $ 72,095,844 $ 302,594,478 Expenditures for segment long-lived assets (property, plant, and equipment, and intangible assets) $ — $ (47,154,109) $ (47,154,109) (*) Bollinger Motors, Inc was acquired on September 7, 2022 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Sep. 30, 2023 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | NOTE 22 – SUBSEQUENT EVENTS Company management has evaluated subsequent events through January 16, 2023, which is the date these financial statements were available to be issued. Except as discussed below, management has determined that there were no subsequent events which required recognition, adjustment to or disclosure in the financial statements: New lease contracts On November 1, 2023, the Company entered a 5-year Continued NASDAQ listing On October 26, 2023, Mullen received approval from the Nasdaq Hearings Panel to continue its listing on The Nasdaq Capital Market. This decision is subject to two conditions: 1. By January 22, 2024, Mullen must demonstrate a closing bid price of $1 per share for 20 consecutive trading sessions to comply with Listing Rule 5550(a)(2). 2. By March 8, 2024, the Company needs to hold an annual shareholder meeting, satisfying Listing Rule 5620(a), which requires providing stockholders an opportunity to discuss company affairs with management. Amendment to Bylaws and Other Events Mullen revised its bylaws, effective November 30, 2023. The updated bylaws, now incorporating earlier amendments, make changes to stockholder nomination procedures. Notably, the timeframe for stockholder notices before annual meetings is now between 90 and 120 days. Additionally, any stockholder seeking to nominate directors must adhere to new SEC proxy rules, including using differently colored proxy cards than the company. Furthermore, the Company has scheduled its 2024 Annual Meeting for February 29, 2024, to be held virtually. This meeting will also count as the annual meeting for 2023, in response to a requirement from Nasdaq's Listing Qualifications Department. These changes reflect the Company’s efforts to streamline its governance and compliance processes, ensuring clearer guidelines for stockholder participation and aligning with regulatory requirements. Lawsuits on manipulation of the share price of the Company’s securities The Company has filed a spoofing complaint on Dec. 6, 2023, in the United States District Court for the Southern District of New York alleging that UBS Securities, LLC, IMC Financial Markets and Clear Street Markets, LLC engaged in a market manipulation scheme using spoofing to manipulate the market price of Mullen share. In connection with the decision to file the spoofing complaint, the Company has voluntarily dismissed the lawsuit originally filed on Aug. 29, 2023, in the United States District Court for the Southern District of New York against certain broker-dealers, alleging a scheme to manipulate the share price of the Company’s securities focusing on short-selling claims. That case covered a limited period of three months and did not provide the Company with a sufficient opportunity to justify the cost that would be incurred in pursuing the claims in that litigation. The Company conducted a cost-benefit analysis of both cases and concluded that it would be a prudent exercise of business judgment to pursue the larger spoofing litigation rather than the short-selling litigation. Prospectus supplement On November 1, 2023, Mullen filed a prospectus supplement with the U.S. Securities and Exchange Commission. This supplement updates the Company's prospectus dated February 14, 2023, and is part of the registration statement filed on the same date. It pertains to the registration of 1,030,097 shares of common stock (giving effect to reverse stock split, see above), related to remaining warrants held by certain selling stockholders. These warrants are part of the Company's existing securities purchase agreement, which has been amended several times since its initial date on June 7, 2022 (see Note 8 Significant stock issuances after the balance sheet date After the balance sheet date, the Company issued 3,012,986 shares of common stock, mainly upon exercise of 279,404 Preferred D Warrants (see Note 8 Certification of products In November 2023, the Mullen ONE received a certificate of conformity from the Environmental Protection Agency on Nov. 2, 2023, permitting sales in the majority of U.S. states. In December 2023, the Mullen ONE received certification from the California Air Resources Board (“CARB”) as a zero-emission vehicle in the state of California permitting sales in remaining15 states and the District of Columbia that follow CARB regulations. Having received credentials from both CARB and the EPA, Mullen can now sell the Mullen ONE in every state throughout the U.S. Additionally, the certification gives the Mullen ONE eligibility for critical state EV incentive programs. The CARB certification takes on even more significance with CARB’s recent Advanced Clean Truck regulation, which will require that all local delivery and government fleets must be zero emissions by 2036. The Company began manufacturing Mullen ONE cargo vans at Tunica Assembly plant on November 1, 2023. Non-convertible secured promissory note On December 18, 2023, Mullen entered into a Debt Agreement to issue a non-convertible secured promissory note (the “Note”) with a principal amount of $50 million, purchased for $32 million, reflecting an $18 million original issue discount. The Note, which does not include conversion rights, stock, warrants, or other securities, aims to raise capital for the Company's manufacturing operations. The issuance of this non-convertible Note is scheduled for the first trading day when all closing conditions are met. By January 15, 2024, the loan has not been received. The Note will incur 10% annual interest, escalating to 18% post-Event of Default. It matures three months post-issuance. The Note's terms allow for accelerated repayment upon default, requiring the Company to pay the principal, accrued interest, and other due amounts. The Note is secured by the Company’s assets and imposes restrictions on the Company, limiting additional debt, asset liens, stock repurchases, outstanding debt repayment, and affiliate transactions, except for specified exceptions. It mandates prepayment of the principal from net proceeds of any subsequent financing. Repayment of related party receivables On January 16, 2023, the Company terminated the Transition Services Agreement between the Company and Mullen Technologies, Inc., and received payment in full settlement of all amounts outstanding (including outstanding notes receivable, advances and related interest) of approximately $2.7 million (refer to Note 20 – Related party transactions Reverse stock split At the Special Meeting reconvened on December 18, 2023, the stockholders approved a proposal to authorize a reverse stock split of the Company’s common stock at a ratio within the range of 1-for- 2 100 100 100 The reverse stock split has not changed the authorized number of shares or the par value of the common stock nor modified any voting rights of the common stock. Also, at the effective Time, the number of shares of common stock issuable upon exercise of warrants, preferred stock, and other convertible securities, as well as any commitments to issue securities, that provide for adjustments in the event of a reverse stock split was appropriately adjusted pursuant to their applicable terms for the reverse stock split. If applicable, the conversion price for each outstanding share of preferred stock and the exercise price for each outstanding warrant was increased, pursuant to their terms, in inverse proportion to the 1-for- 100 No fractional shares were issued in connection with the reverse stock split. All shares of common stock that were held by a stockholder were aggregated subsequent to the reverse stock split and each fractional share resulting from such aggregation held by a stockholder was rounded up to the next whole share. As a result, additional 321,036 shares were issued for the benefit of shareholders that would otherwise obtain fractional shares. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Sep. 30, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Use of Estimates | Use of Estimates The preparation of our financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the dates of the consolidated financial statements and the reported amounts of total expenses in the reporting periods. Estimates are used for, but not limited to, cash flow projections and discount rate for calculation of goodwill impairment, fair value and impairment of long-lived assets, including intangible assets, inventory reserves, accrued expenses, fair value of financial instruments, depreciable lives of property and equipment, income taxes, contingencies, valuation of preferred stock and warrants. Additionally, the rates of interest on several debt agreements have been imputed where there was no stated interest rate within the original agreement. Management bases its estimates on historical experience and on various other assumptions believed to be reasonable, the results of which form the basis for carrying values of assets and liabilities and the recording of costs and expenses that are not readily apparent from other sources. The actual results may differ materially from these estimates. |
Risks and Uncertainties | Risks and Uncertainties We operate within an industry that is subject to rapid technological change, intense competition, and significant government regulation. It is subject to significant risks and uncertainties, including competitive, financial, developmental, operational, technological, required knowledge of industry governmental regulations, and other risks associated with an emerging business. Any one or combination of these or other risks could have a substantial influence on our future operations and prospects for commercial success. |
Business Combination | Business Combination Business acquisitions are accounted for in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 805 “Business Combinations” . FASB ASC 805 requires the reporting entity to identify the acquirer, determine the acquisition date, recognize and measure the identifiable tangible and intangible assets acquired, the liabilities assumed and any noncontrolling interest in the acquired entity, and recognize and measure goodwill or a gain from the purchase. The acquiree’s results are included in the Company’s consolidated financial statements from the date of acquisition. Assets acquired and liabilities assumed are recorded at their fair values and the excess of the purchase price over the amounts assigned is recorded as goodwill. Adjustments to fair value assessments are recorded to goodwill over the measurement period (not longer than twelve months). The acquisition method also requires that acquisition-related transaction and post-acquisition restructuring costs be charged to expense. The Company completed the acquisition of Bollinger Motors Inc. on September 7, 2022 (see Note 4 ). |
Cash and Cash Equivalents | Cash and Cash Equivalents Company management considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. There were no cash equivalents as of September 30, 2023, and 2022, respectively. |
Restricted Cash | Restricted Cash Cash obtained from customer deposits is held by the Company and is restricted from use to fund operations. Refundable deposits were $429 thousand and $289 thousand for the years ended September 30, 2023, and 2022, respectively, and are presented as liabilities. On September 7, 2022, the Company deposited $30 million in an escrow account as part of the Bollinger Motors Inc. acquisition – these funds have been released for the use of Bollinger Motors Inc. during the year ended September 30, 2023. |
Prepaid Expenses and Other Current Assets | Prepaid Expenses and Other Current Assets Prepaid expenses consist of various advance payments made for goods or services to be received in the future. These prepaid expenses include insurance and other contracted services requiring up-front payments. |
Inventory | Inventory Cost of inventories is determined using the standard cost method, which approximates actual cost on a first-in first-out basis. This method includes direct materials, direct labor, and a proportionate share of manufacturing overhead costs based on normal capacity. As of September 30, 2023 there have been no significant direct labor or manufacturing overhead costs included in inventory. Regular reviews are performed to identify and account for variances between the standard costs and actual costs. Any variances identified are recognized in the cost of goods sold during the period in which they occur. On a quarterly basis, the Company reviews its inventory for excess quantities and obsolescence. This analysis takes into account factors such as demand forecasts, product life cycles, product development plans, and current market conditions. Provisions are made to reduce the carrying value of the inventories to their net realizable value. Once inventory is written down, a new, lower-cost basis is established, and the inventory is not subsequently written up if market conditions improve. All such inventory write-downs are included as a component of cost of goods sold in the period in which the write-down occurs. Adjustments to these estimates and assumptions could impact our financial position and results of operations. |
Property, Plant, and Equipment, net | Property, Plant, and Equipment, net Property, plant, and equipment is stated at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated economic useful lives of the assets. Repairs and maintenance expenditures that do not extend the useful lives of related assets are expensed as incurred. Estimated Useful Lives Description Life Buildings 20 Furniture and equipment 3 to 7 years Computer and software 1 to 5 years Machinery, shop and testing equipment 3 to 7 years Leasehold improvements Shorter of the estimated useful life or the underlying lease term Vehicles 5 years Expenditures for major improvements are capitalized, while minor replacements, maintenance and repairs, which do not extend the asset lives, are charged to operations as incurred. Upon sale or disposition, the cost and related accumulated depreciation are removed from the accounts and any gain or loss is included in operations. Company management continually monitors events and changes in circumstances that could indicate that the carrying balances of its property, plant, and equipment may not be recoverable in accordance with the provisions of ASC 360, “Property, Plant, and Equipment.” flows. If the total of the future cash flows is less than the carrying amount of those assets, we recognize an impairment loss based on the excess of the carrying amount over the fair value of the assets. |
Income Taxes | Income Taxes Income taxes are recorded in accordance with ASC 740 , Income Taxes Uncertain tax positions taken or expected to be taken in a tax return are accounted for using the “more likely than not” threshold for financial statement recognition and measurement. There are transactions that occur during the ordinary course of business for which the ultimate tax determination may be uncertain. At September 30, 2023 and 2022, there were no material changes to either the nature or the amounts of the uncertain tax positions. The Company’s income tax provision consists of an estimate for U.S. federal and state income taxes based on enacted rates, as adjusted for allowable credits, deductions, uncertain tax positions, changes in deferred tax assets and liabilities, and changes in the tax law. We maintain a full valuation allowance against the value of our deferred tax assets because based on the weight of evidence available at September 30, 2023 and 2022, it is more likely than not that deferred tax assets will not be realized. |
Intangible Assets, net | Intangible Assets, net Intangible assets consist of acquired and developed intellectual property. In accordance with ASC 350, “Intangibles—Goodwill and Others,” Intangible assets with determinate lives are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Amortizable intangible assets generally are amortized on a straight-line basis over periods up to 120 months. The costs to periodically renew our intangible assets are expensed as incurred. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company periodically evaluates long-lived assets (both intangible assets and property, plant, and equipment) for impairment whenever events or changes in circumstances indicate that a potential impairment may have occurred. If such events or changes in circumstances arise, the Company compares the carrying amount of the long-lived assets to the estimated future undiscounted cash flows expected to be generated by the long-lived assets. If the estimated aggregate undiscounted cash flows are less than the carrying amount of the long-lived assets, an impairment charge, calculated as the amount by which the carrying amount of the assets exceeds the fair value of the assets, is recorded. The fair value of the long-lived assets is determined based on the estimated discounted cash flows expected to be generated from the long-lived asset unless another method provides a more reliable estimate. If an impairment loss is recognized, the adjusted carrying amount of a long-lived asset is recognized as a new cost basis of the impaired asset. Impairment loss is not reversed even if fair value exceeds carrying amount in subsequent periods. |
Other Assets | Other Assets Other assets are comprised primarily of prepayments and security deposits for property leases. |
Extinguishment of Liabilities | Extinguishment of Liabilities The Company derecognizes financial liabilities when the Company’s obligations are discharged, cancelled, or expired. |
Leases | Leases The Company follows the provisions of ASC 842, “Leases” |
Contingencies and Commitments | Contingencies and Commitments The Company follows ASC 440 & ASC 450 to account for contingencies and commitments respectively. Certain conditions, as a result of past events, may exist as of the balance sheet date, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be reasonably estimated, then the estimated liability is accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be reasonably estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed. Legal costs associated with such loss contingencies are expensed as incurred. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. |
Accrued Expenses | Accrued Expenses Accrued expenses are expenses that have been incurred but not yet paid and are classified within current liabilities on the consolidated balance sheets. |
Revenue Recognition | Revenue Recognition The Company’s revenue includes revenue from the sale of electric vehicles and is accounted for in accordance with ASC 606, “Revenue from Contracts with Customers” been sold by such dealer or until there is sufficient evidence to justify a reasonable estimate for the amount of consideration to which the Company expects to be entitled. For any amounts received (or receivable) for which the Company does not recognize revenue when it transfers products to customers, a refund liability is recognized (amounted to $652,200 as at September 30, 2023, none at September 30, 2022). Relevant vehicles transferred to the dealer are presented as “Finished goods delivered to dealer for distribution” in the consolidated balance sheets at initial cost, less any expected costs to recover those products (including potential decreases in the value to the entity of returned products). At the end of each reporting period, the Company updates the measurement of these assets and refund liabilities. |
Cost of Goods Sold | Cost of Goods Sold The Company’s cost of goods sold includes mainly production costs of vehicles sold in the relevant period as well as a provision for expected warranty expenses. |
General and Administrative Expenses | General and Administrative Expenses General and administrative (“G&A”) expenses include expenses such as salaries and employee benefits, professional fees, rent, repairs and maintenance, utilities and office expense, depreciation and amortization, advertising and marketing, settlements and penalties, taxes, and licenses. Advertising costs are expensed as incurred and are included in G&A expenses, other than trade show expenses which are deferred until occurrence of the future event, we expense advertising costs as incurred in accordance with ASC 720-35, “Other Expenses – Advertising Cost.” |
Research and Development Costs | Research and Development Costs Per ASC 730, "Research and Development," |
Share-Based Compensation | Share-Based Compensation The share-based awards issued by the Company are accounted for in accordance with ASC Subtopic 718-10, “Compensation – Share Compensation The overwhelming part of share-based awards to employees per employment contracts, and a certain part of contracts with non-employees (consultants) are classified as equity with costs and additional paid-in capital recognized ratably over the service period. A significant part of the Company’s share-based awards to consultants is liability-classified: mainly if the number of shares consultant is entitled to depends on a certain monetary value fixed in the contract. An accrued part of liability in this case is revaluated each period based on market price of the shares of common stock of the Company, until sufficient number of shares is issued. The Company has also adopted incentive plans that entitle the Chief Executive Officer to share-based awards generally calculated as 1-3% of then outstanding number of shares of common stock, issuable upon achievement of specific financial and operational targets (milestones) that are supposed to significantly increase value of the Company. This share-based compensation is accrued over the service term when it is probable that the milestone will be achieved. The liability to issue stock (presented within non-current liabilities if the achievement is expected later than 12 month after the balance sheet date) is revalued on every balance sheet date based on the length of the service period, current market price of the common stock and on the number of shares of common stock outstanding – until the shares have been issued, or until fulfilling the milestone requirements becomes unlikely. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments We apply fair value accounting for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value on a recurring basis. Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities that are required to be recorded at fair value, Company management considers the principal or most advantageous market in which we would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as risks inherent in valuation techniques, transfer restrictions and credit risk. Fair value is estimated by applying the hierarchy as per requirements of ASC 820, “Fair value measurements” |
Concentrations of Credit Risk | Concentrations of Credit Risk The Company maintains cash balances in several financial institutions that are insured by either the Federal Deposit Insurance Corporation or the National Credit Union Association up to certain federal limitations, generally $250,000. At times, our cash balance may exceed these federal limitations. However, we have not experienced any losses in such accounts and management believes we are not exposed to any significant credit risk on these accounts. The amounts in excess of insured limits as of September 30, 2023 and 2022 are $154.9 million and $53.3 million, respectively. |
Accounting Pronouncements | Accounting Pronouncements The Company has implemented all new applicable accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements. The following are accounting pronouncements that have been issued but are not yet effective for the Company’s consolidated financial statements: In June 2016, the FASB issued ASU 2016-13, “ Measurement of Credit Losses on Financial Instruments In August 2020, the FASB issued ASU No. 2020-06, Debt—Debt with Conversion and Other Options Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt-Modifications and Extinguishments (Subtopic 470-50), Compensation-Stock Compensation (Topic 718), and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40) In November 2023, the FASB issued Accounting Standards Update 2023-07— Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. Other accounting pronouncements issued but not yet effective are not believed by management to be relevant or to have a material impact on the Company’s present or future consolidated financial statements. |
- DESCRIPTION OF BUSINESS AND B
- DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | |
Summary of impact of the reverse stock splits on the shares of common stock previously reported | Pre-RSS Adjustment to RSS 1:25 Adjustment to RSS 1:9 Adjustment to RSS 1:100 Total post-RSS Balance, September 30, 2021 7,048,387 (6,766,452) (250,609) (31,013) 313 Increase of common stock during fiscal year 2022 826,419,793 (793,363,001) (29,383,815) (3,636,247) 36,730 Balance, September 30, 2022 833,468,180 (800,129,453) (29,634,424) (3,667,260) 37,043 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of Property, Equipment and Leasehold Improvements, Net Useful Lives | Description Life Buildings 20 Furniture and equipment 3 to 7 years Computer and software 1 to 5 years Machinery, shop and testing equipment 3 to 7 years Leasehold improvements Shorter of the estimated useful life or the underlying lease term Vehicles 5 years |
ACQUISITION OF SUBSIDIARIES A_2
ACQUISITION OF SUBSIDIARIES AND CERTAIN ASSETS (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
ACQUISITION OF SUBSIDIARIES AND CERTAIN ASSETS | |
Summary of fair value of the purchase price consideration | Cash consideration paid at closing $ 75,000,000 Cash consideration deferred 32,000,000 Stock consideration (2,827 shares of common stock of Mullen) 41,577,647 Fair value of total consideration transferred $ 148,577,647 |
Summary of allocation of fair value of assets acquired and liabilities assumed | Purchase consideration Cash consideration $ 107,000,000 Stock consideration 41,577,647 Total consideration transferred for 60% of Bollinger Motors 148,577,647 Noncontrolling interest (40%) 99,051,765 Fair value of the entity $ 247,629,412 Recognized amounts of identifiable assets acquired and liabilities assumed Cash and restricted cash $ 77,238,086 In-process research and development assets 58,304,612 Patents 32,391,186 Other current assets 867,112 Trademarks 1,075,048 Property, plant, and equipment 1,009,662 Non-compete agreements 745,947 Other non-current assets 246,896 Deferred tax liability (14,882,782) Accounts payable (638,752) Refundable deposits (213,679) Other current liabilities (993,628) Total identifiable net assets $ 155,149,708 Noncontrolling interest (99,051,765) Goodwill 92,479,704 $ 148,577,647 |
Summary of supplemental pro forma information | Year ended September 30, 2022 2021 Total Revenues — — Net loss (753,916,185) (57,647,534) |
Summary of allocation of purchase price by asset category | Asset Category Fair Value Allocation Land $ 1,440,000 Buildings and site improvements 41,287,038 Equipment 27,336,511 Intangible assets: engineering design 22,112,791 Inventory 13,198,692 Total Purchased Assets $ 105,375,032 |
INVENTORY (Tables)
INVENTORY (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
INVENTORY | |
Schedule Of inventories | September 30, 2023 Inventory Work in process 3,136,590 Raw materials 13,733,385 Finished goods delivered to dealer for distribution 937,322 Less: write-down to net realizable value (1,000,284) Total Inventory $ 16,807,013 |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | |
Schedule of finite lived intangible assets | September 30, 2023 September 30, 2022 Net Net Cost Accumulated Carrying Cost Accumulated Carrying Basis Amortization Amount Basis Amortization Amount Finite-Lived Intangible Assets Website design and development $ — $ — $ — $ 2,660,391 $ (1,108,496) $ 1,551,895 Patents 31,708,460 (3,445,694) 28,262,766 32,391,186 (204,109) 32,187,077 Engineering designs 16,200,332 (184,274) 16,016,058 — — — Other 745,947 (158,590) 587,357 2,259,575 (454,756) 1,804,819 Trademarks 1,180,138 (115,682) 1,064,456 466,014 — 466,014 Total finite-lived intangible assets 49,834,877 (3,904,240) 45,930,637 37,777,166 (1,767,361) 36,009,805 Indefinite-Lived Intangible Assets In-process research and development assets $ 58,304,612 $ — $ 58,304,612 $ 57,937,213 $ — $ 57,937,213 Total indefinite-lived intangible assets 58,304,612 — 58,304,612 57,937,213 — 57,937,213 Total Intangible Assets $ 108,139,489 $ (3,904,240) $ 104,235,249 $ 95,714,379 $ (1,767,361) $ 93,947,018 |
Schedule of future amortization expense for finite-lived intangible assets | Years Ended September 30, 2023 Future Amortization 2024 $ 5,250,711 2025 5,250,711 2026 5,250,711 2027 5,241,310 2028 5,101,522 Thereafter 19,835,672 Total Future Amortization $ 45,930,637 |
DEBT (Tables)
DEBT (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
DEBT | |
Schedule of indebtedness of short term and long term debt | Net Carrying Value Unpaid Principal Contractual Contractual Type of Debt Balance Current Long-Term Interest Rate Maturity Matured notes $ 2,398,881 $ 2,398,881 $ — 0.00 - 10.00 % 2019 - 2021 Real Estate note 5,000,000 5,000,000 — 8.99 % 2023-2024 Loan advances 332,800 332,800 — 0.00 - 10.00 % 2016 - 2018 Less: debt discount (270,189) (270,189) — NA NA Total Debt $ 7,461,492 $ 7,461,492 $ — The following is a summary of our indebtedness at September 30, 2022: Net Carrying Value Unpaid Principal Contractual Contractual Type of Debt Balance Current Long-Term Interest Rate Maturity Matured notes $ 3,051,085 $ 3,051,085 $ — 0.00 - 10.00% 2019 - 2021 Promissory notes 1,096,787 — 1,096,787 28.00% 2024 Real Estate note 5,247,612 247,612 5,000,000 5.0 - 8.99% 2023 - 2024 Loan advances 557,800 557,800 — 0.00 - 10.00% 2016 – 2018 Less: debt discount (932,235) — (932,235) NA NA Total Debt $ 9,021,049 $ 3,856,497 $ 5,164,552 |
Scheduled debt maturities | Years Ended September 30, 2023 2024 2025 2026 2027 Total Total Debt $ 2,717,804 $ 4,743,688 $ — $ — $ — $ 7,461,492 |
WARRANTS AND OTHER DERIVATIVE_2
WARRANTS AND OTHER DERIVATIVE LIABILITIES AND FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
WARRANTS AND OTHER DERIVATIVE LIABILITIES AND FAIR VALUE MEASUREMENTS | |
Schedule of fair value of derivative liability on recurring basis | September 30, Quoted Prices Significant Significant 2023 in Active Other Unobservable Markets for Observable Inputs Identical Assets Inputs (Level 3) (Level 1) (Level 2) Derivative liability $ 64,863,309 $ - $ 64,739,175 $ 124,134 September 30, Quoted Prices Significant Significant 2022 in Active Other Unobservable Markets for Observable Inputs Identical Assets Inputs (Level 3) (Level 1) (Level 2) Derivative liability $ 84,799,179 $ - $ 84,799,179 $ - |
Summary of all changes in warrants and other derivative liabilities | Balance, September 30, 2022 $ 84,799,179 Derivative liabilities recognized upon issuance of convertible instruments 501,073,872 Derivative liability recognized upon authorized shares shortfall 11,978,166 Loss / (gain) on derivative liability revaluation 116,256,211 Reclassification of derivative liabilities to equity (47,818,882) Financing loss upon over-issuance of shares from warrants 8,934,892 Receivables upon over-issuance of shares from warrants 17,721,868 Conversions of warrants into shares of common stock (628,081,997) Balance, September 30, 2023 $ 64,863,309 Balance, September 30, 2021 $ — Derivative liabilities recognized upon issuance of convertible instruments 484,421,258 Loss / (gain) on derivative liability revaluation 122,803,715 Conversions of warrants into shares of common stock (555,161,139) Change in agreement with warrant holders (recognized as deemed dividends) 32,735,345 Balance, September 30, 2022 $ 84,799,179 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
STOCKHOLDERS' EQUITY | |
Schedule of Preferred stock | Preferred Stock Preferred Stock Series A Series B Series C Series D Total Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Balance, October 1, 2022 100,363 100 5,567,319 5,568 — — — — 5,667,682 5,668 Issuance of common stock for conversion of preferred stock (98,439) (98) (5,567,319) (5,568) (13,766,058) (13,766) (75,567,273) (75,568) (94,999,089) (95,000) Preferred shares issued for cash — — — — 12,212,450 12,212 79,926,925 79,927 92,139,375 92,139 Preferred shares issued in exchange for conversion of debt — — — — 2,829,029 2,829 — — 2,829,029 2,829 Preferred shares issued to settle liability to issue — — — — 84,900 85 — — 84,900 85 Balance, September 30, 2022 1,924 2 — — 1,360,321 1,360 4,359,652 4,359 5,721,897 5,721 Issuance of preferred stock, common stock and — — — — — — 273,363,635 273,364 273,363,635 273,364 prefunded warrants in lieu of preferred stock Issuance of common stock for conversion of preferred stock and dividends (1,276) (1) — — (148,564) (148) (277,360,190) (277,360) (277,510,030) (277,509) Balance, September 30, 2023 648 1 — — 1,211,757 1,212 363,097 363 1,575,502 1,576 |
LOSS PER SHARE (Tables)
LOSS PER SHARE (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
LOSS PER SHARE | |
Schedule of computation of basic and diluted net income per share | Fiscal Year ended September 30, 2023 2022 Net loss attributable to common stockholders $ (972,254,582) $ (739,532,806) Waived/(Accrued) accumulated preferred dividends 7,360,397 (40,516,440) Net loss used in computing basic net loss per share of common stock $ (964,894,185) $ (780,049,246) Net loss per share $ (1,574.14) $ (63,085.26) Weighted average shares outstanding, basic and diluted 612,964 12,365 |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Table) | 12 Months Ended |
Sep. 30, 2023 | |
SHARE-BASED COMPENSATION | |
Schedule of composition of stock-based compensation expense | For the fiscal year ended September 30, Composition of Stock-Based Compensation Expense 2023 2022 Directors, officers and employees share-based compensation $ 63,748,809 $ 19,471,496 Share-based compensation to consultants (equity-classified) 7,553,487 23,937,976 Share-based compensation to consultants (liability-classified) 14,139,573 330,220 Total share-based compensation expense $ 85,441,869 $ 43,739,692 |
Schedule of awards granted to employees | Awards granted to employees: one time issuance on employment anniversary Number of shares Weighted average grant date fair value of shares Nonvested at the beginning of the year 35 $ 42,416 Granted during the year 1,021 $ 376 Vested during the year (30) $ 43,287 Forfeited during the year (61) $ 2,081 Nonvested at the end of the year 965 $ 456 |
Schedule of awards granted to management | Awards granted to management: issuances on every employment anniversary (*) Number of shares Weighted average grant date fair value of shares Nonvested at the beginning of the year 100 $ 79,616 Granted during the year 100 $ 79,616 Vested during the year (100) $ 79,616 Forfeited during the year (13) $ 159,525 Nonvested at the end of the year 87 $ 67,353 (*) Information is presented for a 12-month period, see comments above. |
Schedule of awards granted to consultants | Awards granted to consultants: classified as equity Number of shares Weighted average grant date fair value of shares Nonvested at the beginning of the year 38 $ 14,400 Granted during the year 6,982 $ 862 Vested during the year (8,019) $ 761 Forfeited during the year - $ - Nonvested at the end of the year 1,000 $ 56 Prepaid in vested stock but not amortized by the end of the year 5,275 $ 128 Awards granted to consultants: classified as liability Number of shares Weighted average grant date fair value of shares Nonvested at the beginning of the year - $ - Granted during the year 102,928 $ 208 Vested during the year (102,928) $ 208 Forfeited during the year - $ - Nonvested at the end of the year - $ - Prepaid in vested stock but not amortized by the end of the year 51,002 $ 87 |
Schedule of CEO performance award | Date Tranche % of O/S Shares O/S Shares Issued Stock Price Stock 9/21/2022 PSA2022. Russell Index Tranche 2% 21,386 428 9,225 $ 3,945,799 10/12/2022 PSA2022. Features Milestone 5% 39,897 1,995 5,625 11,221,088 11/9/2022 PSA2022. Non-USA Distribution 2% 54,718 1,094 6,075 6,648,217 11/30/2022 PSA2022. Capital Benchmark (>$200 mln) 2% 63,923 1,278 4,500 5,753,090 12/16/2022 PSA2022. USA Distribution 2% 75,274 1,505 6,750 10,161,979 2/16/2023 PSA2022. Vehicle Delivery - Pilot 2% 37,079 742 7,650 5,673,024 6/13/2023 PSA2022. Capital Benchmark (>$300 mln) 1% 292,533 2,925 207 605,542 7/5/2023 PSA2022. Capital Benchmark (>$400 mln) 1% 714,863 7,149 53 378,877 10/10/2023 PSA2022. Vehicle Delivery - Mullen 5 2% 1,844,064 36,881 27 985,468 10/10/2023 PSA2023. Accelerated development milestone 2% 2,484,730 49,695 27 1,327,840 Total Shares Awarded 103,692 $ 46,700,924 |
ACCRUED EXPENSES AND OTHER CU_2
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | |
Schedule of accrued expenses and other current liabilities | September 30, 2023 September 30, 2022 Accrued Expenses and Other Liabilities Accrued expense - other $ 34,397,209 $ 3,529,384 IRS tax liability 2,849,346 1,744,707 Accrued payroll 2,406,650 534,782 Accrued interest 1,548,724 1,377,008 Total $ 41,201,929 $ 7,185,881 |
PROPERTY, PLANT, AND EQUIPMEN_2
PROPERTY, PLANT, AND EQUIPMENT, NET (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
PROPERTY, PLANT, AND EQUIPMENT, NET | |
Schedule of property, plant and equipment, net | September 30, September 30, 2023 2022 Buildings $ 48,081,466 $ 7,659,121 Machinery and equipment 27,861,452 7,383,612 Land 3,040,303 647,576 Construction-in-progress 5,180,642 269,778 Other fixed assets 2,824,165 1,743,057 Total cost of assets excluding accumulated impairment 86,988,028 17,703,144 Less: accumulated depreciation (4,955,243) (2,899,428) Property, Plant, and Equipment, Net $ 82,032,785 $ 14,803,716 |
OTHER NON-CURRENT ASSETS (Table
OTHER NON-CURRENT ASSETS (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
OTHER NON-CURRENT ASSETS | |
Schedule of other non-current assets | September 30, 2023 September 30, 2022 Other Non-current Assets Other assets $ — $ 81,589 Show room vehicles — 2,982,986 Security deposits 960,502 281,056 Total Other Assets $ 960,502 $ 3,345,631 |
OPERATING EXPENSES (Tables)
OPERATING EXPENSES (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
OPERATING EXPENSES | |
Schedule of Operating Expenses | General and Administrative Expenses consist of the following: Year ended September 30, 2023 2022 Professional fees $ 36,374,957 $ 46,224,690 Compensation to employees 94,140,300 13,714,669 Depreciation 9,786,011 966,940 Amortization 6,602,288 888,774 Lease 1,429,110 2,145,648 Settlements and penalties 36,196,538 1,134,707 Employee benefits 4,014,915 2,107,793 Utilities and office expense 4,620,425 511,899 Advertising and promotions 8,443,311 4,407,764 Taxes and licenses 442,279 (284,854) Repairs and maintenance 1,128,266 392,679 Executive expenses and directors' fees 699,133 482,455 Listing and regulatory fees 6,042,474 1,546,810 Outside labor — 352,201 Other 5,926,125 746,081 Total $ 215,846,132 $ 75,338,256 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
LEASES | |
Summary of lease assets and liabilities and lease costs | September 30, 2023 September 30, 2022 Assets: Operating lease right-of-use assets $ 5,249,417 $ 4,597,052 Liabilities: Operating lease liabilities, current (2,134,494) (1,428,474) Operating lease liabilities, non-current (3,566,922) (3,359,354) Total lease liabilities $ (5,701,416) $ (4,787,828) Weighted average remaining lease terms: Operating leases 3.98 years 2.63 years Weighted average discount rate: Operating leases 28 % 28 % Cash paid for amounts included in the measurement of lease liabilities for the fiscal year ended September 30, 2023, and 2022 $ 3,168,567 $ 1,751,680 Operating lease costs: For the fiscal year ended September 30, 2023 2022 Fixed lease cost $ 3,318,326 $ 1,718,424 Variable lease cost 250,499 496,914 Short-term lease cost — 164,690 Sublease income (362,126) (293,511) Total operating lease costs $ 3,206,699 $ 2,086,517 |
Summary of maturities of operating lease liabilities | Years ending September 30, 2024 $ 3,135,400 2025 2,639,884 2026 803,759 2027 584,468 2028 206,919 Thereafter 1,579,534 Total lease payments $ 8,949,964 Less: imputed interest (3,248,548) Present value of lease liabilities $ 5,701,416 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
INCOME TAXES | |
Schedule of total provision (benefit) for income taxes | September 30, September 30, 2023 2022 Current Federal $ — $ — State 2,400 1,600 Total Current $ 2,400 $ 1,600 Deferred Federal $ (10,990,882) $ (280,552) State — — Total Deferred $ (10,990,882) $ (280,552) Total provision (benefit) for income taxes $ (10,988,482) $ (278,952) |
Summary of income tax NOL carryforwards | September 30, September 30, 2023 2022 Federal 2034-2037 $ 29,838,716 $ 29,838,716 Indefinite 451,052,564 311,525,886 Total Federal $ 480,891,280 $ 341,364,602 California 2034-2040 $ 473,427,974 $ 318,862,714 Total California $ 473,427,974 $ 318,862,714 |
Summary of reconciliation of our effective tax rate to statutory federal tax rate | September 30, September 30, September 30, September 30, 2023 2023 - % 2022 2022 - % Income tax benefit at statutory rate $ (213,705,935) 21% $ (155,466,389) 21% State income taxes 2,400 0% 1,600 0% Permanent differences 155,268,652 (15)% 995,227 (0.13)% Valuation allowance 49,635,916 (5)% 154,180,328 (20.83)% Federal return to provision true up (2,269,617) 0% — 0% Other 80,102 0% 10,282 0% Total (benefit) provision for income taxes $ (10,988,482) 1% $ (278,952) 0.04% |
Summary of significant component of net deferred tax assets | 2023 2022 Deferred tax assets: Stock compensation $ 10,327,117 $ 8,442 Net operating loss carryforwards 118,886,728 78,791,906 Charitable contributions 2,680 1,219 Accrued expenses 414,745 86,926 Impairment other — — Other assets 413,579 426,099 Intangibles 48,382,778 163(j) limitation 15,971,671 14,522,536 Research expenditures 16,077,633 — Mark-to-market warrants — 121,545,414 Total gross deferred tax assets 162,094,153 263,765,320 R&D tax credits 7,353,043 578,842 Less valuation allowance (155,435,630) (258,903,457) Total net deferred tax assets 14,011,566 5,440,705 Deferred tax liabilities: Intangibles (16,358,329) (19,428,527) Fixed assets (1,545,473) (969,201) Other 336 (336) Total deferred tax liabilities (17,903,466) (20,398,064) Net deferred tax assets $ (3,891,900) $ (14,957,359) |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
RELATED PARTY TRANSACTIONS | |
Summary of related party transactions | Advances Interest on advances Note Interest on note Total Balance, September 30, 2021 — — — — — Additions 1,232,387 — — — 1,232,387 Repayments — — — — — Balance, September 30, 2022 1,232,387 - - - 1,232,387 Additions 392,954 — 446,091 — 839,045 Conversion (1,388,405) — 1,388,405 — — Accrued interest — 91,030 — 88,027 179,057 Repayments — — — — — Balance, September 30, 2023 236,936 91,030 1,834,496 88,027 2,250,489 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
SEGMENT INFORMATION | |
Schedule of all revenue presented in these financial statements relates to contracts with customers located in the United States of America | Segment reporting for the year ended September 30, 2023 Bollinger Mullen/ELMS Total Revenues (including $308,000 from one dealer) $ — $ 366,000 $ 366,000 Interest gains 1,585,376 684,367 2,269,743 Interest expenses (88,580) (4,904,560) (4,993,140) Depreciation and amortization expense (3,808,877) (12,579,422) (16,388,299) Impairment of goodwill (63,988,000) — (63,988,000) Impairment of property, plant, and equipment — (14,770,000) (14,770,000) Impairment of intangible assets — (5,873,000) (5,873,000) Income tax benefit/(expense) 10,990,882 (2,400) 10,988,482 Other significant noncash items: Stock-based compensation — (85,441,869) (85,441,869) Revaluation of derivative liabilities — (116,256,212) (116,256,212) Initial recognition of derivative liabilities — (513,052,038) (513,052,038) Non-cash financing loss on over-exercise of warrants — (8,934,892) (8,934,892) Loss on extinguishment of debt — (6,246,089) (6,246,089) Net loss $ (83,285,117) $ (923,373,711) $ (1,006,658,828) Total segment assets $ 169,410,298 $ 252,295,433 $ 421,705,730 Expenditures for segment's long-lived assets (property, plant, and equipment, and intangible assets) $ (4,677,421) $ (103,245,888) $ (107,923,309) Segment reporting for the year ended September 30, 2022 (*) Bollinger Mullen Total Revenues $ — $ — $ — Interest gains — — — Interest expenses — (26,949,081) (26,949,081) Depreciation and amortization expense (605,216) (2,677,069) (3,282,285) Other significant noncash items: Stock-based compensation — (43,715,242) (43,715,242) Revaluation of derivative liabilities — (122,803,715) (122,803,715) Initial recognition of derivative liabilities — (484,421,258) (484,421,258) Non-cash interest and other operating activities — (13,883,637) (13,883,637) Amortization of debt discount — (19,595,915) (19,595,915) Net loss $ (1,979,865) $ (738,344,887) $ (740,324,752) Segment assets $ 230,498,634 $ 72,095,844 $ 302,594,478 Expenditures for segment long-lived assets (property, plant, and equipment, and intangible assets) $ — $ (47,154,109) $ (47,154,109) (*) Bollinger Motors, Inc was acquired on September 7, 2022 |
DESCRIPTION OF BUSINESS AND B_2
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION (Details) | 1 Months Ended | 12 Months Ended | |||||||||
Dec. 21, 2023 shares | Dec. 18, 2023 | Aug. 11, 2023 | May 04, 2023 | Sep. 30, 2022 USD ($) $ / shares | Oct. 01, 2021 USD ($) | Dec. 31, 2023 | Aug. 31, 2023 | Jan. 31, 2023 | Sep. 30, 2023 segment $ / shares shares | Apr. 17, 2023 | |
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | |||||||||||
Common Stock, par value | $ / shares | $ 0.001 | $ 0.001 | |||||||||
Reverse stock ratio | 0.11 | 0.04 | 0.01 | 0.04 | |||||||
Fractional shares | 0 | ||||||||||
Decrease in equity of reverse stock | $ | $ 833,431 | $ 7,048 | |||||||||
Number of operating segment | segment | 2 | ||||||||||
Series B Preferred Stock | |||||||||||
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | |||||||||||
Preferred Stock, shares outstanding | 0 | ||||||||||
Subsequent event | |||||||||||
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | |||||||||||
Reverse stock ratio | 0.01 | 0.01 | 0.01 | ||||||||
Fractional shares | 0 | ||||||||||
Minimum | Subsequent event | |||||||||||
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | |||||||||||
Reverse stock ratio | 0.5 | 0.5 | |||||||||
Maximum | Subsequent event | |||||||||||
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | |||||||||||
Reverse stock ratio | 0.01 | 0.01 | |||||||||
Equity Incentive Plan, 2022 | |||||||||||
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | |||||||||||
Additional shares authorized | 52,000,000 | ||||||||||
Bollinger Motors, Inc | |||||||||||
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | |||||||||||
Beneficial ownership | 60% | ||||||||||
Mullen Advanced Energy Operations LLC | |||||||||||
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | |||||||||||
Beneficial ownership | 51% |
DESCRIPTION OF BUSINESS AND B_3
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION - Reverse stock splits on the shares of common stock (Details) - Common Stock | 12 Months Ended |
Sep. 30, 2022 shares | |
Schedule of Equity Method Investments [Line Items] | |
Balance, beginning (in shares) | 313 |
Increase of common stock during fiscal year 2022 | 36,730 |
Balance, ending (in shares) | 37,043 |
Pre-RSS | |
Schedule of Equity Method Investments [Line Items] | |
Balance, beginning (in shares) | 7,048,387 |
Increase of common stock during fiscal year 2022 | 826,419,793 |
Balance, ending (in shares) | 833,468,180 |
Adjustment to RSS 1:25 | |
Schedule of Equity Method Investments [Line Items] | |
Balance, beginning (in shares) | (6,766,452) |
Increase of common stock during fiscal year 2022 | (793,363,001) |
Balance, ending (in shares) | (800,129,453) |
Adjustment to RSS 1:9 | |
Schedule of Equity Method Investments [Line Items] | |
Balance, beginning (in shares) | (250,609) |
Increase of common stock during fiscal year 2022 | (29,383,815) |
Balance, ending (in shares) | (29,634,424) |
Adjustment to RSS 1:100 | |
Schedule of Equity Method Investments [Line Items] | |
Balance, beginning (in shares) | (31,013) |
Increase of common stock during fiscal year 2022 | (3,636,247) |
Balance, ending (in shares) | (3,667,260) |
LIQUIDITY, CAPITAL RESOURCES,_2
LIQUIDITY, CAPITAL RESOURCES, AND GOING CONCERN (Details) - USD ($) | 12 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2021 | |
LIQUIDITY, CAPITAL RESOURCES, AND GOING CONCERN | |||
Cash and restricted cash | $ 155,696,470 | $ 84,375,085 | $ 42,174 |
Net working capital | 58,500,000 | ||
Working capital excluding derivative liabilities | 133,300,000 | ||
Accumulated deficit | (1,862,162,037) | (889,907,455) | |
Net loss | $ (1,006,658,828) | $ (740,324,752) |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Property, Plant, and Equipment, net (Details) | Sep. 30, 2023 |
Buildings | Maximum | |
Property, Plant And Equipment | |
Property, plant and equipment, useful life | 30 years |
Buildings | Minimum | |
Property, Plant And Equipment | |
Property, plant and equipment, useful life | 20 years |
Furniture and equipment | Maximum | |
Property, Plant And Equipment | |
Property, plant and equipment, useful life | 7 years |
Furniture and equipment | Minimum | |
Property, Plant And Equipment | |
Property, plant and equipment, useful life | 3 years |
Computer and software | Maximum | |
Property, Plant And Equipment | |
Property, plant and equipment, useful life | 5 years |
Computer and software | Minimum | |
Property, Plant And Equipment | |
Property, plant and equipment, useful life | 1 year |
Machinery, shop and testing equipment | Maximum | |
Property, Plant And Equipment | |
Property, plant and equipment, useful life | 7 years |
Machinery, shop and testing equipment | Minimum | |
Property, Plant And Equipment | |
Property, plant and equipment, useful life | 3 years |
Vehicles | |
Property, Plant And Equipment | |
Property, plant and equipment, useful life | 5 years |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 07, 2022 | |
Cash and cash equivalents | $ 155,267,098 | $ 54,085,685 | |
Refundable deposits | 429,000 | 289,000 | |
Refund liability | 652,200 | 0 | |
Amounts in excess of insured limits | 154,900,000 | 53,300,000 | |
Cash equivalents | 0 | 0 | |
General and administrative ("G&A") expenses | |||
Advertising costs | $ 8,443,311 | $ 4,407,764 | |
Bollinger Motors, Inc | |||
Escrow deposit | $ 30,000,000 | ||
Minimum | |||
Share-based awards granted to Chief Executive Office (as a percent) | 1% | ||
Maximum | |||
Amortization period | 120 months | ||
Share-based awards granted to Chief Executive Office (as a percent) | 3% |
ACQUISITION OF SUBSIDIARIES A_3
ACQUISITION OF SUBSIDIARIES AND CERTAIN ASSETS - Additional information (Details) | 12 Months Ended | ||||
Apr. 17, 2023 USD ($) | Nov. 30, 2022 item | Oct. 13, 2022 USD ($) | Sep. 07, 2022 USD ($) item shares | Sep. 30, 2022 USD ($) shares | |
Business Acquisition | |||||
Cash consideration paid at closing | $ 29,631,984 | ||||
ELMS | |||||
Business Acquisition | |||||
Approximate sale consideration approved | $ 105,000,000 | ||||
Number of vehicles | item | 50,000 | ||||
Mullen Advanced Energy Operations LLC | |||||
Business Acquisition | |||||
Percentage of ownership (as a percent) | 51% | ||||
Mullen Advanced Energy Operations LLC | |||||
Business Acquisition | |||||
Cash consideration, deferred | $ 5,000,000 | ||||
Upfront payment paid for investment in subsidiary | $ 50,000 | ||||
Mullen Advanced Energy Operations LLC | Mullen Advanced Energy Operations LLC | Lawrence Hardge, Global EV Technology, Inc., and EV Technology, LLC [Member] | |||||
Business Acquisition | |||||
Noncontrolling interest percentage | 49% | ||||
Common stock | |||||
Business Acquisition | |||||
Shares acquired | shares | 2,827 | ||||
Bollinger Motors, Inc | |||||
Business Acquisition | |||||
Business acquisition, percentage of voting interests acquired | 60% | ||||
Total consideration | $ 148,577,647 | ||||
Cash consideration due | 107,000,000 | ||||
Cash consideration paid at closing | 75,000,000 | ||||
Fair value adjustment of shares | $ 247,629,412 | ||||
Business combination, initial royalty rate | 5% | ||||
Business combination, percentage of decrease in royalty rate | 1% | ||||
Business combination, percentage of decrease in royalty term | 10 years | ||||
Bollinger Motors, Inc | Minimum | |||||
Business Acquisition | |||||
Number of medium duty truck classes | item | 4 | ||||
Business Combination, annual discount rate | 40% | ||||
Bollinger Motors, Inc | Maximum | |||||
Business Acquisition | |||||
Number of medium duty truck classes | item | 6 | ||||
Business Combination, annual discount rate | 42% | ||||
Bollinger Motors, Inc | Consideration, paid at closing | |||||
Business Acquisition | |||||
Cash consideration paid at closing | $ 75,000,000 | ||||
Bollinger Motors, Inc | Consideration, paid in five installments through August 5, 2023 | |||||
Business Acquisition | |||||
Cash consideration, deferred | $ 32,000,000 | ||||
Bollinger Motors, Inc | Common stock | |||||
Business Acquisition | |||||
Shares acquired | shares | 544,347 | ||||
Number of common stock acquired | shares | 2,827 | ||||
Fair value adjustment of shares | $ 41,600,000 |
ACQUISITION OF SUBSIDIARIES A_4
ACQUISITION OF SUBSIDIARIES AND CERTAIN ASSETS - Summary of fair value of the purchase price consideration (Details) - USD ($) | 12 Months Ended | |
Sep. 07, 2022 | Sep. 30, 2022 | |
Business Acquisition | ||
Cash consideration paid at closing | $ 29,631,984 | |
Bollinger Motors, Inc | ||
Business Acquisition | ||
Cash consideration paid at closing | $ 75,000,000 | |
Cash consideration- deferred | 32,000,000 | |
Stock consideration (2,827 shares of common stock of Mullen) | 41,577,647 | |
Fair value of total consideration transferred | $ 148,577,647 | |
Bollinger Motors, Inc | Common Stock | ||
Business Acquisition | ||
Number of common stock acquired | 2,827 |
ACQUISITION OF SUBSIDIARIES A_5
ACQUISITION OF SUBSIDIARIES AND CERTAIN ASSETS - Summary of allocation of fair value of assets acquired and liabilities assumed (Details) - USD ($) | Sep. 07, 2022 | Sep. 30, 2023 | Sep. 30, 2022 |
Business Acquisition | |||
Goodwill | $ 28,846,832 | $ 92,834,832 | |
Bollinger Motors, Inc | |||
Business Acquisition | |||
Cash consideration | $ 107,000,000 | ||
Stock consideration | 41,577,647 | ||
Total consideration transferred for 60% of Bollinger Motors | 148,577,647 | ||
Noncontrolling interest (40%) | 99,051,765 | ||
Fair value of the entity | 247,629,412 | ||
Cash and restricted cash | 77,238,086 | ||
Other current assets | 867,112 | ||
Property, plant, and equipment | 1,009,662 | ||
Other non-current assets | 246,896 | ||
Accounts payable | (638,752) | ||
Refundable deposits | (213,679) | ||
Deferred tax liability | (14,882,782) | ||
Other current liabilities | (993,628) | ||
Total identifiable net assets | 155,149,708 | ||
Noncontrolling interest | 99,051,765 | ||
Goodwill | 92,479,704 | ||
Total identifiable assets acquired and liabilities assumed | $ 148,577,647 | ||
Business acquisition, percentage of voting interests acquired | 60% | ||
Bollinger Motors, Inc | In-process research and development assets | |||
Business Acquisition | |||
Finite-lived intangibles | $ 58,304,612 | ||
Bollinger Motors, Inc | Patents | |||
Business Acquisition | |||
Property, plant, and equipment | 32,391,186 | ||
Bollinger Motors, Inc | Trademark | |||
Business Acquisition | |||
Finite-lived intangibles | 1,075,048 | ||
Bollinger Motors, Inc | Non-compete agreements | |||
Business Acquisition | |||
Finite-lived intangibles | $ 745,947 |
ACQUISITION OF SUBSIDIARIES A_6
ACQUISITION OF SUBSIDIARIES AND CERTAIN ASSETS - Summary of supplemental pro forma information (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Bollinger Motors, Inc | ||
Business Acquisition | ||
Net loss | $ (753,916,185) | $ (57,647,534) |
ACQUISITION OF SUBSIDIARIES A_7
ACQUISITION OF SUBSIDIARIES AND CERTAIN ASSETS - Fair value allocation of ELMS (Details) - ELMS | Nov. 30, 2022 USD ($) |
Asset acquisition | |
Land | $ 1,440,000 |
Buildings and site improvements | 41,287,038 |
Equipment | 27,336,511 |
Intangible assets: engineering design | 22,112,791 |
Inventory | 13,198,692 |
Total Purchased Assets | $ 105,375,032 |
INVENTORY - Components (Details
INVENTORY - Components (Details) | Sep. 30, 2023 USD ($) |
INVENTORY | |
Work in process | $ 3,136,590 |
Raw materials | 13,733,385 |
Finished goods delivered to dealer for distribution | 937,322 |
Less: write-down to net realizable value | (1,000,284) |
Total Inventories | $ 16,807,013 |
INVENTORY - Additional informat
INVENTORY - Additional information (Details) $ in Millions | 12 Months Ended |
Sep. 30, 2023 USD ($) | |
INVENTORY | |
Inventory write down | $ 1 |
Inventories consumed for R&D activities | $ 1 |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS - Goodwill (Details) - USD ($) | 12 Months Ended | ||
Sep. 01, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | |
Finite-Lived Intangible Assets [Line Items] | |||
Goodwill in gross | $ 92,834,832 | ||
Goodwill | 28,846,832 | $ 92,834,832 | |
Impairment of goodwill | $ 63,988,000 | 63,988,000 | |
Noncontrolling interest | $ 63,855,573 | $ 98,259,819 | |
Subsidiaries | |||
Finite-Lived Intangible Assets [Line Items] | |||
Noncontrolling interest | $ (25,595,200) |
GOODWILL AND OTHER INTANGIBLE_4
GOODWILL AND OTHER INTANGIBLE ASSETS - Intangible assets - General information (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Finite-Lived Intangible Assets | ||
Intangible asset net carrying amount | $ 104,235,249 | $ 93,947,018 |
Impairment loss of intangible assets | 5,873,000 | |
Accumulated depreciation | 3,904,240 | $ 1,767,361 |
ELMS/Legacy Mullen | ||
Finite-Lived Intangible Assets | ||
Impairment loss of intangible assets | 5,873,000 | |
Accumulated depreciation | $ 4,318,850 | |
Intellectual property | ||
Finite-Lived Intangible Assets | ||
Weighted average Useful life | 8 years 11 months 19 days |
GOODWILL AND OTHER INTANGIBLE_5
GOODWILL AND OTHER INTANGIBLE ASSETS - Intangible assets -Total (Details) - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
Finite-Lived Intangible Assets | ||
Gross Carrying Amount | $ 49,834,877 | $ 37,777,166 |
Accumulated Amortization | (3,904,240) | (1,767,361) |
Net Carrying Amount | 45,930,637 | 36,009,805 |
Indefinite-Lived Intangible Assets | ||
Indefinite-Lived Intangible Assets | 58,304,612 | 57,937,213 |
Total Intangible Assets, Gross | 108,139,489 | 95,714,379 |
Total Intangible Assets | 104,235,249 | 93,947,018 |
In-process research and development assets | ||
Indefinite-Lived Intangible Assets | ||
Indefinite-Lived Intangible Assets | 58,304,612 | 57,937,213 |
Website design and development | ||
Finite-Lived Intangible Assets | ||
Gross Carrying Amount | 2,660,391 | |
Accumulated Amortization | (1,108,496) | |
Net Carrying Amount | 1,551,895 | |
Patents | ||
Finite-Lived Intangible Assets | ||
Gross Carrying Amount | 31,708,460 | 32,391,186 |
Accumulated Amortization | (3,445,694) | (204,109) |
Net Carrying Amount | 28,262,766 | 32,187,077 |
Engineer Design - ELMS | ||
Finite-Lived Intangible Assets | ||
Gross Carrying Amount | 16,200,332 | |
Accumulated Amortization | (184,274) | |
Net Carrying Amount | 16,016,058 | |
Other | ||
Finite-Lived Intangible Assets | ||
Gross Carrying Amount | 745,947 | 2,259,575 |
Accumulated Amortization | (158,590) | (454,756) |
Net Carrying Amount | 587,357 | 1,804,819 |
Trademarks | ||
Finite-Lived Intangible Assets | ||
Gross Carrying Amount | 1,180,138 | 466,014 |
Accumulated Amortization | (115,682) | |
Net Carrying Amount | $ 1,064,456 | $ 466,014 |
GOODWILL AND OTHER INTANGIBLE_6
GOODWILL AND OTHER INTANGIBLE ASSETS - Future amortization expense for finite-lived intangible assets (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Future Amortization Expense | ||
2024 | $ 5,250,711 | |
2025 | 5,250,711 | |
2026 | 5,250,711 | |
2027 | 5,241,310 | |
2028 | 5,101,522 | |
Thereafter | 19,835,672 | |
Net Carrying Amount | 45,930,637 | $ 36,009,805 |
Amortization | $ 6,526,911 | $ 1,476,457 |
DEBT - Summary of our indebtedn
DEBT - Summary of our indebtedness (Details) - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 | Mar. 07, 2022 |
Debt Instrument [Line Items] | |||
Net Carrying Value Unpaid Principal Balance | $ 7,461,492 | $ 9,021,049 | |
Current | 7,461,492 | 3,856,497 | |
Long-term | 5,164,552 | ||
Less: debt discount | (270,189) | (932,235) | |
Less: debt discount (Current) | (270,189) | ||
Less: debt discount (Long-Term) | (932,235) | ||
Matured notes | |||
Debt Instrument [Line Items] | |||
Net Carrying Value Unpaid Principal Balance | 2,398,881 | 3,051,085 | |
Current | $ 2,398,881 | $ 3,051,085 | |
Matured notes | Maximum | |||
Debt Instrument [Line Items] | |||
Contractual Interest Rate | 10% | 10% | |
Matured notes | Minimum | |||
Debt Instrument [Line Items] | |||
Contractual Interest Rate | 0% | 0% | |
Promissory notes | |||
Debt Instrument [Line Items] | |||
Net Carrying Value Unpaid Principal Balance | $ 1,096,787 | ||
Long-term | $ 1,096,787 | ||
Contractual Interest Rate | 28% | 8.99% | |
Real Estate note | |||
Debt Instrument [Line Items] | |||
Net Carrying Value Unpaid Principal Balance | $ 5,000,000 | $ 5,247,612 | |
Current | $ 5,000,000 | 247,612 | |
Long-term | $ 5,000,000 | ||
Real Estate note | Maximum | |||
Debt Instrument [Line Items] | |||
Contractual Interest Rate | 8.99% | ||
Real Estate note | Minimum | |||
Debt Instrument [Line Items] | |||
Contractual Interest Rate | 8.99% | 5% | |
Loan advances | |||
Debt Instrument [Line Items] | |||
Net Carrying Value Unpaid Principal Balance | $ 332,800 | $ 557,800 | |
Current | $ 332,800 | $ 557,800 | |
Loan advances | Maximum | |||
Debt Instrument [Line Items] | |||
Contractual Interest Rate | 10% | 10% | |
Loan advances | Minimum | |||
Debt Instrument [Line Items] | |||
Contractual Interest Rate | 0% | 0% |
DEBT - Scheduled debt maturitie
DEBT - Scheduled debt maturities (Details) - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
Debt Maturities | ||
2023 | $ 2,717,804 | |
2024 | 4,743,688 | |
Net Carrying Value Unpaid Principal Balance | $ 7,461,492 | $ 9,021,049 |
DEBT - NuBridge Commercial Lend
DEBT - NuBridge Commercial Lending LLC Promissory Note (Details) - USD ($) | 12 Months Ended | |||
Nov. 15, 2022 | Mar. 07, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Promissory notes | ||||
Debt Instrument [Line Items] | ||||
Principal amount | $ 5,000,000 | |||
Interest rate (as a percent) | 8.99% | 28% | ||
Amortization of debt discount | $ 1,157,209 | |||
Carrying amount of debt settled via issuance of stock during the period | $ 167,070,343 | |||
Remaining unamortized discount | $ 270,188 | |||
Convertible notes | ||||
Debt Instrument [Line Items] | ||||
Principal amount | $ 150,000,000 | |||
Interest rate (as a percent) | 15% | |||
Debt discount on convertible notes | $ 150,000,000 |
DEBT - Amended and Restated Sec
DEBT - Amended and Restated Secured Convertible Note and Security Agreement (Details) - USD ($) | 12 Months Ended | |||
Nov. 01, 2022 | Oct. 14, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Debt Instrument [Line Items] | ||||
Debt discount | $ 270,189 | $ 932,235 | ||
Loss on extinguishment of debt | $ (6,246,089) | $ 33,413 | ||
A&R Note | A&R Note | ||||
Debt Instrument [Line Items] | ||||
Liability to issue common shares | 10,710,000 | |||
A&R Note | Esousa Holdings, LLC | A&R Note | ||||
Debt Instrument [Line Items] | ||||
Amount of debt converted | $ 1,032,217 | |||
Debt discount | 64,570 | |||
Debt instrument accrued interest | $ 316,127 | |||
Liability to issue common shares | 467 | |||
Debt conversion to common stock | $ 12,945,914 | |||
Shares issued for conversion of convertible debt ( in shares) | 1,022 | |||
Shares issued fair value | $ 5,524,600 | |||
Loss on extinguishment of debt | $ (6,452,170) | |||
Shares issuable upon conversion | 2,758 |
DEBT - Convertible Notes (Detai
DEBT - Convertible Notes (Details) | 1 Months Ended | 12 Months Ended | ||||||
Nov. 21, 2022 USD ($) shares | Nov. 14, 2022 USD ($) tranche $ / shares | Feb. 28, 2023 USD ($) shares | Sep. 30, 2023 USD ($) $ / shares | Sep. 30, 2022 USD ($) $ / shares | Jun. 30, 2023 $ / shares | Jan. 13, 2023 USD ($) | Nov. 15, 2022 USD ($) | |
Debt Instrument [Line Items] | ||||||||
Proceeds from investors in exchange for notes convertible into shares of the Company's Common Stock | $ 170,000,000 | $ 12,240,353 | ||||||
Derivative Liability, Statement of Financial Position [Extensible Enumeration] | Derivative Liability, Current | |||||||
Warrants exercise price | $ / shares | $ 0.4379 | |||||||
Amendment No. 3 to Securities Purchase Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Proceeds from investors in exchange for notes convertible into shares of the Company's Common Stock | $ 150,000,000 | |||||||
Remaining Commitment Amount, Number of tranches | tranche | 2 | |||||||
Share Purchase Price, Floor price (in dollars per share) | $ / shares | $ 0.10 | |||||||
Additional consideration for issuance of warrants | $ 0 | |||||||
Percentage of Preferred Stock exercisable for warrants | 185% | |||||||
Securities Purchase Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Warrants exercise price | $ / shares | $ 0.432 | |||||||
Series D Preferred Stock | ||||||||
Debt Instrument [Line Items] | ||||||||
Original issue price | $ / shares | $ 0.4379 | |||||||
Series D Preferred Stock | Amendment No. 3 to Securities Purchase Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Remaining Commitment Amount | $ 90,000,000 | |||||||
Closing price of the Common Stock | $ / shares | $ 1.27 | |||||||
Amount after reverse stock splits for conversion of preferred stock | $ 28,575 | |||||||
Series D Preferred Stock | Securities Purchase Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Value of right to purchase additional shares and warrants | $ 10,000,000 | |||||||
Convertible notes | Share conversion price lower of (i) $0.303; or (ii) the closing price on November 18, 2022 | ||||||||
Debt Instrument [Line Items] | ||||||||
Amount After Reverse Stock Splits for Conversion of Debt | $ 6,818 | |||||||
Convertible notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal amount | $ 150,000,000 | |||||||
Interest rate (as a percent) | 15% | |||||||
Conversion ratio | 1.85 | |||||||
Warrants term | 5 years | |||||||
Derivative liability | $ 244,510,164 | |||||||
Increase in debt discount | 150,000,000 | |||||||
Debt instrument interest expense | 94,510,164 | |||||||
Debt instrument accrued interest | $ 1,548,723 | $ 1,374,925 | ||||||
Amount of debt converted | $ 59,402,877 | $ 90,362,418 | ||||||
Accrued interests | $ 3,456,941 | |||||||
Shares issued for conversion of convertible debt ( in shares) | shares | 9,815 | 13,762 | ||||||
Convertible notes | Share conversion price lower of (i) $0.303; or (ii) the closing price on November 18, 2022 | ||||||||
Debt Instrument [Line Items] | ||||||||
Conversion ratio | 0.303 |
WARRANTS AND OTHER DERIVATIVE_3
WARRANTS AND OTHER DERIVATIVE LIABILITIES AND FAIR VALUE MEASUREMENTS - (Details) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||
Mar. 14, 2023 USD ($) item shares | Feb. 10, 2022 USD ($) | Jun. 30, 2023 USD ($) $ / shares shares | Apr. 30, 2023 USD ($) $ / shares shares | Feb. 28, 2023 shares | Nov. 30, 2022 USD ($) | Sep. 30, 2022 USD ($) $ / shares shares | Dec. 31, 2022 shares | Jun. 30, 2023 USD ($) $ / shares shares | Sep. 30, 2023 USD ($) $ / shares shares | Sep. 30, 2022 USD ($) $ / shares shares | Jun. 15, 2023 $ / shares | Nov. 21, 2022 | |
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Debt premium | $ | $ 662,047 | $ 19,595,915 | |||||||||||
Deemed dividend on preferred stock | $ | 7,360,397 | $ (40,516,440) | |||||||||||
Exercised on a cash-less basis | 0 | ||||||||||||
Warrants exercise price | $ / shares | $ 0.4379 | $ 0.4379 | |||||||||||
Warrants exercise price, after reverse stock splits | $ / shares | $ 9,853 | 9,853 | |||||||||||
Proceeds from issuance of shares and warrants | $ | $ 35,000,000 | ||||||||||||
Securities Purchase Agreement | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Warrants exercise price | $ / shares | $ 0.432 | $ 0.432 | |||||||||||
Warrants exercise price, after reverse stock splits | $ / shares | $ 388.8 | 388.8 | |||||||||||
Proceeds from issuance of shares and warrants | $ | $ 45,000,000 | ||||||||||||
Warrants issued (in shares) | 214,120 | ||||||||||||
Securities Purchase Agreement | Scenario one | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Warrants exercise price | $ / shares | $ 0.52 | 0.52 | |||||||||||
Warrants exercise price, after reverse stock splits | $ / shares | $ 468 | $ 468 | |||||||||||
Proceeds from issuance of shares and warrants | $ | $ 7,000,000 | ||||||||||||
Securities Purchase Agreement | Scenario two | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Warrants to acquire shares of common stock | 1 | 1 | |||||||||||
Warrants exercise price | $ / shares | $ 0.1601 | $ 0.1601 | |||||||||||
Warrants exercise price, after reverse stock splits | $ / shares | 144.09 | $ 144.09 | |||||||||||
Proceeds from issuance of shares and warrants | $ | $ 100,000,000 | ||||||||||||
Number of shares issued (in shares) | 183,731 | ||||||||||||
Warrants issued (in shares) | 761,079 | ||||||||||||
Warrants exercisable | 508,159 | ||||||||||||
Securities Purchase Agreement | Scenario two | One Investor | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Warrants exercise price | $ / shares | 0.1696 | $ 0.1696 | |||||||||||
Warrants exercise price, after reverse stock splits | $ / shares | $ 152.64 | $ 152.64 | |||||||||||
Securities Purchase Agreement | Scenario three | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Fair value of common stock warrants | $ | $ 64,739,175 | ||||||||||||
Warrants term | 5 years | ||||||||||||
Proceeds from issuance of shares and warrants | $ | $ 254,962,776 | ||||||||||||
Convertible notes | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Warrants term | 5 years | ||||||||||||
Proceeds from issuance of notes payable | $ | $ 150,000,000 | ||||||||||||
Prefunded Warrants | Securities Purchase Agreement | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Warrants exercisable | 54,962 | ||||||||||||
Warrants to purchase to common stock | 1 | 1 | |||||||||||
Prefunded Warrants | Securities Purchase Agreement | Scenario three | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Exercisable on a cash-less basis | 0 | ||||||||||||
Preferred D Warrants | Securities Purchase Agreement | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Warrants exercise price | $ / shares | $ 0.1 | ||||||||||||
Proceeds from issuance of shares and warrants | $ | $ 45,000,000 | ||||||||||||
Preferred C Warrants 2021 | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Warrants exercise price | $ / shares | $ 8.834 | 8.834 | |||||||||||
Warrants exercise price, after reverse stock splits | $ / shares | $ 198,765 | $ 198,765 | |||||||||||
Preferred C Warrants 2022 | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Warrants | 132 | ||||||||||||
Initial expense upon issuance of warrants | $ | $ 429,883,573 | ||||||||||||
Debt premium | $ | 137,090,205 | ||||||||||||
Amortization of financing costs | $ | $ 292,793,368 | ||||||||||||
Deemed dividend on preferred stock | $ | $ (32,735,345) | ||||||||||||
Exercised on a cash-less basis | 1,864 | ||||||||||||
Warrants to acquire shares of common stock | 23,698 | 23,698 | |||||||||||
Fair value of warrants | $ | $ 554,371,539 | $ 554,371,539 | |||||||||||
Preferred D Warrants 2022 | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Fair value of common stock warrants | $ | $ 55,398,551 | $ 55,398,551 | |||||||||||
Exercised on a cash-less basis | 10,182 | ||||||||||||
Warrants exercise price | $ / shares | $ 1.27 | ||||||||||||
Warrants exercise price, after reverse stock splits | $ / shares | $ 28,575 | ||||||||||||
Warrants term | 5 years | ||||||||||||
Warrants issued (in shares) | 263 | ||||||||||||
Percentage of warrants exercisable for common stock | 110% | 185% | |||||||||||
Preferred D Warrants 2022 | Securities Purchase Agreement | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Fair value of common stock warrants | $ | $ 73,260,454 | ||||||||||||
Exercisable on a cash-less basis | 147,672 | ||||||||||||
Warrants exercise price, after reverse stock splits | $ / shares | $ 2,250 | ||||||||||||
Warrants issued (in shares) | 37,000 | ||||||||||||
Preferred D Warrants 2022 | Securities Purchase Agreement | Scenario one | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Warrants issued (in shares) | 27,671 | ||||||||||||
Preferred D Warrants 2022 | Securities Purchase Agreement | Scenario three | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Exercised on a cash-less basis | 2,194,413 | ||||||||||||
Exercisable on a cash-less basis | 382,436 | ||||||||||||
Preferred D Warrants 2022 | Convertible notes | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Exercisable on a cash-less basis | 93,664 | ||||||||||||
Warrants issued (in shares) | 43,616 | ||||||||||||
Qiantu Warrants | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Fair value of warrants | $ | $ 6,814,000 | $ 124,133 | |||||||||||
Market price of the Company's common shares | 110% | ||||||||||||
Warrants exercise price | $ / shares | $ 234 | ||||||||||||
Number of intellectual property agreement | item | 2 | ||||||||||||
Period to use the license under intellectual property agreement | 5 years | ||||||||||||
Qiantu Warrants | Maximum | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Warrants to acquire shares of common stock | 3,334 | ||||||||||||
Series D Preferred Stock | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Investment right amount | $ | $ 100,000,000 | $ 100,000,000 | |||||||||||
Number of shares issued (in shares) | 79,926,925 | ||||||||||||
Series D Preferred Stock | Securities Purchase Agreement | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Number of shares issued (in shares) | 273,363,635 | ||||||||||||
Common Stock | Securities Purchase Agreement | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Number of shares issued (in shares) | 60,778 | ||||||||||||
Common Stock | Securities Purchase Agreement | Scenario one | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Number of shares issued (in shares) | 14,957 | ||||||||||||
Common Stock | Securities Purchase Agreement | Scenario three | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Warrants to acquire shares of common stock | 1,438,009 | ||||||||||||
Common Stock | Series D Preferred Stock | Securities Purchase Agreement | |||||||||||||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
Conversion of stock, shares issued | 7,851 |
WARRANTS AND OTHER DERIVATIVE_4
WARRANTS AND OTHER DERIVATIVE LIABILITIES AND FAIR VALUE MEASUREMENTS - Fair Value of warrant (Details) - Revaluation prior to conversion of underlying instrument | Sep. 30, 2023 |
Dividend yield | |
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |
Embedded derivative, measurement input | 0 |
Volatility | Minimum | |
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |
Embedded derivative, measurement input | 198 |
Volatility | Maximum | |
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |
Embedded derivative, measurement input | 222 |
Risk-free interest rate | Minimum | |
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |
Embedded derivative, measurement input | 4.3 |
Risk-free interest rate | Maximum | |
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | |
Embedded derivative, measurement input | 4.7 |
WARRANTS AND OTHER DERIVATIVE_5
WARRANTS AND OTHER DERIVATIVE LIABILITIES AND FAIR VALUE MEASUREMENTS - Financial Liabilities Measured at Fair Value on a Recurring Basis (Details) - Recurring - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | ||
Derivative liability | $ 64,863,309 | $ 84,799,179 |
Level 2 | ||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | ||
Derivative liability | 64,739,175 | $ 84,799,179 |
Level 3 | ||
FAIR VALUE MEASUREMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS | ||
Derivative liability | $ 124,134 |
WARRANTS AND OTHER DERIVATIVE_6
WARRANTS AND OTHER DERIVATIVE LIABILITIES AND FAIR VALUE MEASUREMENTS - Changes in derivative liability (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
WARRANTS AND OTHER DERIVATIVE LIABILITIES AND FAIR VALUE MEASUREMENTS | ||
Balance, Beginning | $ 84,799,179 | |
Derivative liabilities recognized upon issuance of convertible instruments | 501,073,872 | $ 484,421,258 |
Derivative liability recognized upon authorized shares shortfall | 11,978,166 | |
Loss / (gain) on derivative liability revaluation | $ 116,256,211 | $ 122,803,715 |
Fair Value, Liability, Recurring Basis, Unobservable Input Reconciliation, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Derivative, Gain (Loss) on Derivative, Net | Derivative, Gain (Loss) on Derivative, Net |
Reclassification of derivative liabilities to equity | $ (47,818,882) | |
Financing loss upon over-issuance of shares from warrants | 8,934,892 | |
Receivables upon over-issuance of shares from warrants | 17,721,868 | |
Conversions of warrants into shares of common stock | (628,081,997) | $ (555,161,139) |
Change in agreement with warrant holders (recognized as deemed dividends | 32,735,345 | |
Balance, Ending | $ 64,863,309 | $ 84,799,179 |
STOCKHOLDERS' EQUITY - Common S
STOCKHOLDERS' EQUITY - Common Stock (Details) | 1 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2023 | Aug. 11, 2023 | Jul. 06, 2023 USD ($) $ / shares shares | May 04, 2023 | Aug. 31, 2023 | Jan. 31, 2023 | Sep. 30, 2023 USD ($) $ / shares shares | Sep. 30, 2022 $ / shares shares | Jan. 25, 2023 shares | Jan. 24, 2023 shares | |
Class of Stock [Line Items] | ||||||||||
Common Stock, shares authorized | 5,000,000,000 | 1,750,000,000 | 5,000,000,000 | 1,750,000,000 | ||||||
Common Stock, par value | $ / shares | $ 0.001 | $ 0.001 | ||||||||
Common Stock, shares issued | 2,871,707 | 37,043 | ||||||||
Common Stock, shares outstanding | 2,871,707 | 37,043 | ||||||||
Voting rights | one | |||||||||
Reverse stock ratio | 0.11 | 0.04 | 0.01 | 0.04 | ||||||
Common stock dividends declared or paid | $ | $ 0 | |||||||||
Common stock | ||||||||||
Class of Stock [Line Items] | ||||||||||
Issuance of common stock as payment of penalty to shareholder (in shares) | 1,022 | 248 | ||||||||
Cashless Warrant exercise (in shares) | 2,455,348 | 23,567 | ||||||||
Issuance of common stock for conversion of preferred stock (in shares) | 4,655 | |||||||||
Dollar 25 Million Stock Buyback Program | Common stock | ||||||||||
Class of Stock [Line Items] | ||||||||||
Shares repurchased | $ | $ 25,000,000 | |||||||||
Shares repurchased broker from unrelated parties | 57,000 | |||||||||
Reverse Stock Split | 0.01 | |||||||||
Minimum | Dollar 25 Million Stock Buyback Program | ||||||||||
Class of Stock [Line Items] | ||||||||||
Closing market price | $ / shares | $ 98.5 | |||||||||
Maximum | Dollar 25 Million Stock Buyback Program | ||||||||||
Class of Stock [Line Items] | ||||||||||
Closing market price | $ / shares | $ 99.7 |
STOCKHOLDERS' EQUITY - Change i
STOCKHOLDERS' EQUITY - Change in Control Agreements (Details) - Change in Control Agreements $ in Millions | Aug. 11, 2023 USD ($) |
Minimum | |
Class of Stock [Line Items] | |
Beneficial ownership (as a percent) | 50% |
Board of Directors | |
Class of Stock [Line Items] | |
Payment pursuant to change in control | $ 5 |
Chief Executive Officer | Transaction Proceeds Scenario One [Member] | |
Class of Stock [Line Items] | |
Percentage of transaction proceeds paid as compensation (as a percent) | 10% |
Transaction proceeds threshold | $ 1,000 |
Chief Executive Officer | Transaction Proceeds Scenario Two [Member] | |
Class of Stock [Line Items] | |
Percentage of transaction proceeds paid as compensation (as a percent) | 5% |
Chief Executive Officer | Transaction Proceeds Scenario Two [Member] | Minimum | |
Class of Stock [Line Items] | |
Transaction proceeds threshold | $ 1,000 |
Chief Executive Officer | Transaction Proceeds Scenario Two [Member] | Maximum | |
Class of Stock [Line Items] | |
Transaction proceeds threshold | $ 1,500 |
Chief Executive Officer | Transaction Proceeds Scenario Three [Member] | |
Class of Stock [Line Items] | |
Percentage of transaction proceeds paid as compensation (as a percent) | 5% |
Transaction proceeds threshold | $ 1,500 |
STOCKHOLDERS' EQUITY - Preferre
STOCKHOLDERS' EQUITY - Preferred Stock (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Class of Stock [Line Items] | ||
Preferred Stock, shares authorized | 500,000,000 | 500,000,000 |
Preferred Stock, par value | $ 0.001 | $ 0.001 |
Balance, beginning | $ 156,956,709 | $ (61,711,647) |
Preferred shares issued for cash | 141,101,534 | |
Preferred shares issued in exchange for conversion of debt | 24,991,755 | |
Preferred shares issued to settle liability to issue | 705,000 | |
Issuance of preferred stock, common stock and prefunded warrants in lieu of preferred stock | 196,825,212 | |
Issuance of common stock for conversion of preferred stock and dividends | (20) | |
Balance, ending | 272,808,110 | 156,956,709 |
Preferred Stock | ||
Class of Stock [Line Items] | ||
Balance, beginning | $ 5,721 | $ 5,668 |
Balance, beginning (in shares) | 5,721,897 | 5,667,682 |
Issuance of common stock for conversion of preferred stock | $ (95,000) | |
Issuance of common stock for conversion of preferred stock (in shares) | (94,999,089) | |
Preferred shares issued for cash | $ 92,139 | |
Preferred shares issued for cash (in shares) | 92,139,375 | |
Preferred shares issued in exchange for conversion of debt | $ 2,829 | |
Preferred shares issued in exchange for conversion of debt (in shares) | 2,829,029 | |
Preferred shares issued to settle liability to issue | $ 85 | |
Preferred shares issued to settle liability to issue (in shares) | 84,900 | |
Issuance of preferred stock, common stock and prefunded warrants in lieu of preferred stock | $ 273,364 | |
Issuance of preferred stock, common stock and prefunded warrants in lieu of preferred stock (in shares) | 273,363,635 | |
Issuance of common stock for conversion of preferred stock and dividends | $ (277,509) | |
Issuance of common stock for conversion of preferred stock and dividends (in shares) | (277,510,030) | |
Balance, ending | $ 1,576 | $ 5,721 |
Balance, ending (in shares) | 1,575,502 | 5,721,897 |
Series A Preferred Stock | ||
Class of Stock [Line Items] | ||
Preferred Stock, shares authorized | 200,000 | 200,000 |
Preferred Stock, shares issued | 648 | 1,924 |
Preferred Stock, shares outstanding | 648 | 1,924 |
Series A Preferred Stock | Preferred Stock | ||
Class of Stock [Line Items] | ||
Balance, beginning | $ 2 | $ 100 |
Balance, beginning (in shares) | 1,924 | 100,363 |
Issuance of common stock for conversion of preferred stock | $ (98) | |
Issuance of common stock for conversion of preferred stock (in shares) | (98,439) | |
Issuance of common stock for conversion of preferred stock and dividends | $ (1) | |
Issuance of common stock for conversion of preferred stock and dividends (in shares) | (1,276) | |
Balance, ending | $ 1 | $ 2 |
Balance, ending (in shares) | 648 | 1,924 |
Series B Preferred Stock | ||
Class of Stock [Line Items] | ||
Preferred Stock, shares issued | 0 | |
Preferred Stock, shares outstanding | 0 | |
Series B Preferred Stock | Preferred Stock | ||
Class of Stock [Line Items] | ||
Balance, beginning | $ 5,568 | |
Balance, beginning (in shares) | 5,567,319 | |
Issuance of common stock for conversion of preferred stock | $ (5,568) | |
Issuance of common stock for conversion of preferred stock (in shares) | (5,567,319) | |
Series C Preferred Stock | ||
Class of Stock [Line Items] | ||
Preferred Stock, shares authorized | 40,000,000 | 40,000,000 |
Preferred Stock, shares issued | 1,211,757 | 1,360,321 |
Preferred Stock, shares outstanding | 1,211,757 | 1,360,321 |
Series C Preferred Stock | Preferred Stock | ||
Class of Stock [Line Items] | ||
Balance, beginning | $ 1,360 | |
Balance, beginning (in shares) | 1,360,321 | |
Issuance of common stock for conversion of preferred stock | $ (13,766) | |
Issuance of common stock for conversion of preferred stock (in shares) | (13,766,058) | |
Preferred shares issued for cash | $ 12,212 | |
Preferred shares issued for cash (in shares) | 12,212,450 | |
Preferred shares issued in exchange for conversion of debt | $ 2,829 | |
Preferred shares issued in exchange for conversion of debt (in shares) | 2,829,029 | |
Preferred shares issued to settle liability to issue | $ 85 | |
Preferred shares issued to settle liability to issue (in shares) | 84,900 | |
Issuance of common stock for conversion of preferred stock and dividends | $ (148) | |
Issuance of common stock for conversion of preferred stock and dividends (in shares) | (148,564) | |
Balance, ending | $ 1,212 | $ 1,360 |
Balance, ending (in shares) | 1,211,757 | 1,360,321 |
Series D Preferred Stock | ||
Class of Stock [Line Items] | ||
Preferred Stock, shares authorized | 437,500,001 | 437,500,001 |
Preferred Stock, shares issued | 363,097 | 4,359,652 |
Preferred Stock, shares outstanding | 363,097 | 4,359,652 |
Series D Preferred Stock | Preferred Stock | ||
Class of Stock [Line Items] | ||
Balance, beginning | $ 4,359 | |
Balance, beginning (in shares) | 4,359,652 | |
Issuance of common stock for conversion of preferred stock | $ (75,568) | |
Issuance of common stock for conversion of preferred stock (in shares) | (75,567,273) | |
Preferred shares issued for cash | $ 79,927 | |
Preferred shares issued for cash (in shares) | 79,926,925 | |
Issuance of preferred stock, common stock and prefunded warrants in lieu of preferred stock | $ 273,364 | |
Issuance of preferred stock, common stock and prefunded warrants in lieu of preferred stock (in shares) | 273,363,635 | |
Issuance of common stock for conversion of preferred stock and dividends | $ (277,360) | |
Issuance of common stock for conversion of preferred stock and dividends (in shares) | (277,360,190) | |
Balance, ending | $ 363 | $ 4,359 |
Balance, ending (in shares) | 363,097 | 4,359,652 |
STOCKHOLDERS' EQUITY - Redempti
STOCKHOLDERS' EQUITY - Redemption Rights and Dividends (Details) | 12 Months Ended | |
Sep. 30, 2023 USD ($) D $ / shares | Sep. 30, 2022 USD ($) | |
Class of Stock [Line Items] | ||
Minimum Term of Shares Issued and Outstanding | 1 year | |
Preferred stock redemption, number of trading days | D | 20 | |
Preferred stock redemption, number of consecutive trading days | D | 30 | |
Adjustment to the additional paid-in capital | $ 7,360,397 | |
Dividends payable | 401,859 | $ 7,762,255 |
Series A Preferred Stock | ||
Class of Stock [Line Items] | ||
Preferred stock dividends declared or paid | 0 | 0 |
Series B Preferred Stock | ||
Class of Stock [Line Items] | ||
Preferred stock dividends declared or paid | $ 0 | $ 0 |
Series C Preferred Stock | ||
Class of Stock [Line Items] | ||
Percentage of redemption price in first year | 0% | |
Percentage of redemption price in second year | 120% | |
Percentage of redemption price in third year | 115% | |
Percentage of redemption price in fourth year | 110% | |
Percentage of redemption price in fifth year | 105% | |
Percentage of redemption price in sixth year and thereafter | 100% | |
Redemption Price | $ / shares | $ 8.84 | |
Preferred stock dividends rate, percentage | 15% | |
Series D Preferred Stock | ||
Class of Stock [Line Items] | ||
Percentage of redemption price in first year | 0% | |
Percentage of redemption price in second year | 120% | |
Percentage of redemption price in third year | 115% | |
Percentage of redemption price in fourth year | 110% | |
Percentage of redemption price in fifth year | 105% | |
Percentage of redemption price in sixth year and thereafter | 100% | |
Redemption Price | $ / shares | $ 0.4379 | |
Preferred stock dividends rate, percentage | 15% | |
Dividends payable | $ 400,000 | |
Number of Trading Days | D | 10 | |
Number of Consecutive Trading Days | D | 20 | |
Average daily trading volume of the Common Stock | $ 27,500,000 |
STOCKHOLDERS' EQUITY - Liquidat
STOCKHOLDERS' EQUITY - Liquidation, Conversion and Voting Rights (Details) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Sep. 30, 2023 USD ($) Vote D $ / shares shares | Sep. 30, 2022 USD ($) shares | Mar. 08, 2022 $ / shares | |
Class of Stock [Line Items] | |||
Voting rights | one | ||
Number of votes per share | Vote | 1,000 | ||
Series A Preferred Stock | |||
Class of Stock [Line Items] | |||
Price per share in purchase agreement (USD per share) | $ / shares | $ 1.29 | ||
Preferred Stock, shares outstanding | 648 | 1,924 | |
Preferred Stock, shares issued | 648 | 1,924 | |
Conversion ratio | 0.0044 | ||
Accrued dividend | $ | $ 0 | $ 0 | |
Series B Preferred Stock | |||
Class of Stock [Line Items] | |||
Preferred Stock, shares outstanding | 0 | ||
Preferred Stock, shares issued | 0 | ||
Accrued dividend | $ | $ 0 | $ 0 | |
Series C Preferred Stock | |||
Class of Stock [Line Items] | |||
Preferred Stock, shares outstanding | 1,211,757 | 1,360,321 | |
Preferred Stock, shares issued | 1,211,757 | 1,360,321 | |
Conversion ratio | 0.000044 | ||
Original issue price | $ / shares | $ 8.84 | ||
Accrued dividend | $ | $ 0 | $ 0 | |
Ratio of Trading Price to Conversion Price | 2 | ||
Trading days | D | 20 | ||
Consecutive trading days | D | 30 | ||
Value of average daily trading dollar volume | $ | $ 4 | ||
Series D Preferred Stock | |||
Class of Stock [Line Items] | |||
Preferred Stock, shares outstanding | 363,097 | 4,359,652 | |
Preferred Stock, shares issued | 363,097 | 4,359,652 | |
Conversion ratio | 0.000044 | ||
Original issue price | $ / shares | $ 0.4379 | ||
Accrued dividend | $ | $ 0 | $ 0 | |
Ratio of Trading Price to Conversion Price | 2 | ||
Trading days | D | 20 | ||
Consecutive trading days | D | 30 | ||
Voting rights | one | ||
Series B And C Preferred Stock | |||
Class of Stock [Line Items] | |||
Voting rights | one |
LOSS PER SHARE (Details)
LOSS PER SHARE (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
LOSS PER SHARE | ||
Net loss attributable to common stockholders | $ (972,254,582) | $ (739,532,806) |
Waived/(Accrued) accumulated preferred dividends | 7,360,397 | (40,516,440) |
Net loss attributable to common stockholders after preferred dividends | $ (964,894,185) | $ (780,049,246) |
Net Loss per share, basic | $ (1,574.14) | $ (63,085.26) |
Net Loss per share, diluted | $ (1,574.14) | $ (63,083.67) |
Weighted average shares outstanding, basic | 612,964 | 12,365 |
Weighted average shares outstanding, diluted | 612,964 | 12,365 |
SHARE-BASED COMPENSATION (Detai
SHARE-BASED COMPENSATION (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Composition of Stock-Based Compensation Expense | ||
Directors, officers and employees share-based compensation | $ 63,748,809 | $ 19,471,496 |
Share-based compensation to consultants (equity-classified) | 7,553,487 | 23,937,976 |
Share-based compensation to consultants (liability-classified) | 14,139,573 | 330,220 |
Total share-based compensation expense | $ 85,441,869 | $ 43,739,692 |
SHARE-BASED COMPENSATION - Addi
SHARE-BASED COMPENSATION - Additional Information (Details) | 1 Months Ended | 12 Months Ended | ||||
Oct. 03, 2022 item | Jul. 02, 2022 USD ($) | Dec. 31, 2022 item | Sep. 30, 2024 USD ($) | Sep. 30, 2023 USD ($) item shares | Sep. 30, 2022 USD ($) | |
SHARE- BASED COMPENSATION | ||||||
Total share-based compensation expense | $ 85,441,869 | $ 43,739,692 | ||||
Research and development expenses | ||||||
SHARE- BASED COMPENSATION | ||||||
Total share-based compensation expense | $ 5,000,000 | 0 | ||||
Employee | ||||||
SHARE- BASED COMPENSATION | ||||||
Vesting period | 14 months | |||||
Unrecognized compensation costs | $ 200,000 | |||||
Weighted-average period cost expected to be recognized | 6 months | |||||
Stock-based compensation liability contract amount | $ 75,000 | |||||
Total share-based compensation expense | $ 6,000,000 | |||||
Employee | Subsequent event | ||||||
SHARE- BASED COMPENSATION | ||||||
Total share-based compensation expense | $ 5,800,000 | |||||
Consultants | ||||||
SHARE- BASED COMPENSATION | ||||||
Weighted-average period cost expected to be recognized | 6 months | |||||
Stock-based compensation liability contract amount | $ 0 | |||||
Weighted average term of contracts | 5 months | |||||
Prepaid costs amount | $ 5,100,000 | |||||
Equity Incentives plan | Common stock | Employees and consultants | ||||||
SHARE- BASED COMPENSATION | ||||||
Remaining shares reserved for the plan | shares | 42,234,250 | |||||
CEO Award Incentive Plans | ||||||
SHARE- BASED COMPENSATION | ||||||
Weighted average term of contracts | 12 months | |||||
Issuances of common stock fair value | $ 40,400,000 | |||||
Remaining compensation cost | $ 31,300,000 | |||||
Weighted-average period of remaining compensation cost | 14 months | |||||
CEO Award Incentive Plans | 2022 PSA Agreement | Vehicle Delivery Milestones | ||||||
SHARE- BASED COMPENSATION | ||||||
Number of vehicle delivery milestone | item | 5 | |||||
Number of class Van to customers pilot program | item | 1 | 1 | 1 | |||
CEO Award Incentive Plans | 2022 PSA Agreement | Capital Benchmark Milestones | ||||||
SHARE- BASED COMPENSATION | ||||||
Percentage of common stock equal to issued and outstanding shares | 1% | |||||
Aggregate maximum of raised in debt | $ 100,000,000 | |||||
Aggregate maximum capital raised in equity | 1,000,000,000 | |||||
CEO Award Incentive Plans | 2022 PSA Agreement | Capital Benchmark Milestones | Securities Purchase Agreement | ||||||
SHARE- BASED COMPENSATION | ||||||
Capital raise by issuance of equity | $ 400,000,000 | |||||
Financial milestone one raising capital | 500,000,000 | |||||
Financial milestone two raising capital | $ 600,000,000 | |||||
CEO Award Incentive Plans | 2023 PSA Agreement | Revenue Benchmark Milestones | ||||||
SHARE- BASED COMPENSATION | ||||||
Revenue recognized | 25,000,000 | |||||
Aggregate maximum of recognized revenue | $ 250,000,000 | |||||
CEO Award Incentive Plans | Employee | ||||||
SHARE- BASED COMPENSATION | ||||||
Shares issued during the period | shares | 16,689 | |||||
CEO Award Incentive Plans | CEO | Minimum | ||||||
SHARE- BASED COMPENSATION | ||||||
Percentage of awards to be issued | 1% | |||||
CEO Award Incentive Plans | CEO | Maximum | ||||||
SHARE- BASED COMPENSATION | ||||||
Percentage of awards to be issued | 3% | |||||
CEO Award Incentive Plans | Mr. Michery | 2022 PSA Agreement | Vehicle Delivery Milestones | ||||||
SHARE- BASED COMPENSATION | ||||||
Percentage of common stock equal to issued and outstanding shares | 2% | |||||
CEO Award Incentive Plans | Mr. Michery | 2022 PSA Agreement | Capital Benchmark Milestones | ||||||
SHARE- BASED COMPENSATION | ||||||
Percentage of common stock equal to issued and outstanding shares | 2% | |||||
CEO Award Incentive Plans | Mr. Michery | 2022 PSA Agreement | Feature Milestone | ||||||
SHARE- BASED COMPENSATION | ||||||
Percentage of common stock equal to issued and outstanding shares | 5% | |||||
CEO Award Incentive Plans | Mr. Michery | 2022 PSA Agreement | Distribution Milestone | ||||||
SHARE- BASED COMPENSATION | ||||||
Percentage of common stock equal to issued and outstanding shares | 2% | |||||
CEO Award Incentive Plans | Mr. Michery | 2023 PSA Agreement | Vehicle Completion Milestones | ||||||
SHARE- BASED COMPENSATION | ||||||
Percentage of common stock equal to issued and outstanding shares | 3% | |||||
CEO Award Incentive Plans | Mr. Michery | 2023 PSA Agreement | Revenue Benchmark Milestones | ||||||
SHARE- BASED COMPENSATION | ||||||
Percentage of common stock equal to issued and outstanding shares | 1% | |||||
CEO Award Incentive Plans | Mr. Michery | 2023 PSA Agreement | Battery Development Milestones | ||||||
SHARE- BASED COMPENSATION | ||||||
Percentage of common stock equal to issued and outstanding shares | 2% | |||||
CEO Award Incentive Plans | Mr. Michery | 2023 PSA Agreement | JV-Acquisition Milestones | ||||||
SHARE- BASED COMPENSATION | ||||||
Percentage of common stock equal to issued and outstanding shares | 3% | |||||
CEO Award Incentive Plans | Mr. Michery | 2023 PSA Agreement | Accelerated development milestone | ||||||
SHARE- BASED COMPENSATION | ||||||
Percentage of common stock equal to issued and outstanding shares | 2% | |||||
CEO Award Incentive Plans | Common stock | ||||||
SHARE- BASED COMPENSATION | ||||||
Additional shares authorized | shares | 293,861 | |||||
CEO Award Incentive Plan 2022 | ||||||
SHARE- BASED COMPENSATION | ||||||
Percentage of common stock equal to issued and outstanding shares | 1% | |||||
Accrual for future awards amount | $ 2,600,000 | |||||
Accrual for future awards milestone amount | 1,700,000 | |||||
Outstanding common stock | 100,000,000 | |||||
CEO Award Incentive Plan 2023 | ||||||
SHARE- BASED COMPENSATION | ||||||
Accrual for future awards amount | 8,700,000 | |||||
Accrual for future awards milestone amount | 2,200,000 | |||||
Recognized within non-current liabilities | $ 1,800,000 |
SHARE-BASED COMPENSATION - Awar
SHARE-BASED COMPENSATION - Awards granted to employees, management and consultant (Details) | 12 Months Ended |
Sep. 30, 2023 $ / shares shares | |
Number of shares | |
Nonvested at the beginning of the year | 100 |
Employee | |
Number of shares | |
Nonvested at the beginning of the year | 35 |
Granted during the year | 1,021 |
Vested during the year | (30) |
Forfeited during the year | (61) |
Nonvested at the end of the year | 965 |
Weighted average grant date fair value of shares | |
Nonvested at the beginning of the year | $ / shares | $ 42,416 |
Granted during the year | $ / shares | 376 |
Vested during the year | $ / shares | 43,287 |
Forfeited during the year | $ / shares | 2,081 |
Nonvested at the end of the year | $ / shares | $ 456 |
Managements | Board and Executive Officer | |
Number of shares | |
Nonvested at the beginning of the year | 100 |
Granted during the year | 100 |
Vested during the year | (100) |
Forfeited during the year | (13) |
Nonvested at the end of the year | 87 |
Weighted average grant date fair value of shares | |
Nonvested at the beginning of the year | $ / shares | $ 79,616 |
Granted during the year | $ / shares | 79,616 |
Vested during the year | $ / shares | 79,616 |
Forfeited during the year | $ / shares | 159,525 |
Nonvested at the end of the year | $ / shares | $ 67,353 |
Consultants | Awards classified as equity | |
Number of shares | |
Nonvested at the beginning of the year | 38 |
Granted during the year | 6,982 |
Vested during the year | (8,019) |
Nonvested at the end of the year | 1,000 |
Prepaid in vested stock but not amortized by the end of the year | 5,275 |
Weighted average grant date fair value of shares | |
Nonvested at the beginning of the year | $ / shares | $ 14,400 |
Granted during the year | $ / shares | 862 |
Vested during the year | $ / shares | 761 |
Nonvested at the end of the year | $ / shares | 56 |
Prepaid in vested stock but not amortized by the end of the year | $ / shares | $ 128 |
Consultants | Awards Classified As Liability | |
Number of shares | |
Prepaid in vested stock but not amortized by the end of the year | 51,002 |
Weighted average grant date fair value of shares | |
Prepaid in vested stock but not amortized by the end of the year | $ / shares | $ 87 |
Number of shares | |
Nonvested at the beginning of the year | |
Granted during the year | 102,928 |
Vested during the year | (102,928) |
Nonvested at the end of the year | |
Weighted average grant date fair value of shares | |
Nonvested at the beginning of the year | $ / shares | |
Granted during the year | $ / shares | 208 |
Vested during the year | $ / shares | 208 |
Nonvested at the end of the year | $ / shares |
SHARE-BASED COMPENSATION - CEO
SHARE-BASED COMPENSATION - CEO performance award (Details) - CEO Performance Award | 12 Months Ended |
Sep. 30, 2023 USD ($) $ / shares shares | |
SHARE- BASED COMPENSATION | |
Shares issued during the period | 103,692 |
Stock Compensation | $ | $ 46,700,924 |
Russell Index Tranche | |
SHARE- BASED COMPENSATION | |
Percentage of O/S Shares | 2% |
Shares O/S | 21,386 |
Shares issued during the period | 428 |
Stock Price | $ / shares | $ 9,225 |
Stock Compensation | $ | $ 3,945,799 |
Feature Milestone | |
SHARE- BASED COMPENSATION | |
Percentage of O/S Shares | 5% |
Shares O/S | 39,897 |
Shares issued during the period | 1,995 |
Stock Price | $ / shares | $ 5,625 |
Stock Compensation | $ | $ 11,221,088 |
Non-USA Distribution | |
SHARE- BASED COMPENSATION | |
Percentage of O/S Shares | 2% |
Shares O/S | 54,718 |
Shares issued during the period | 1,094 |
Stock Price | $ / shares | $ 6,075 |
Stock Compensation | $ | $ 6,648,217 |
Capital Benchmark | |
SHARE- BASED COMPENSATION | |
Percentage of O/S Shares | 2% |
Shares O/S | 63,923 |
Shares issued during the period | 1,278 |
Stock Price | $ / shares | $ 4,500 |
Stock Compensation | $ | $ 5,753,090 |
USA Distribution | |
SHARE- BASED COMPENSATION | |
Percentage of O/S Shares | 2% |
Shares O/S | 75,274 |
Shares issued during the period | 1,505 |
Stock Price | $ / shares | $ 6,750 |
Stock Compensation | $ | $ 10,161,979 |
Vehicle Delivery - Pilot | |
SHARE- BASED COMPENSATION | |
Percentage of O/S Shares | 2% |
Shares O/S | 37,079 |
Shares issued during the period | 742 |
Stock Price | $ / shares | $ 7,650 |
Stock Compensation | $ | $ 5,673,024 |
Capital Benchmark | |
SHARE- BASED COMPENSATION | |
Percentage of O/S Shares | 1% |
Shares O/S | 292,533 |
Shares issued during the period | 2,925 |
Stock Price | $ / shares | $ 207 |
Stock Compensation | $ | $ 605,542 |
Capital Benchmark | |
SHARE- BASED COMPENSATION | |
Percentage of O/S Shares | 1% |
Shares O/S | 714,863 |
Shares issued during the period | 7,149 |
Stock Price | $ / shares | $ 53 |
Stock Compensation | $ | $ 378,877 |
Vehicle Delivery | |
SHARE- BASED COMPENSATION | |
Percentage of O/S Shares | 2% |
Shares O/S | 1,844,064 |
Shares issued during the period | 36,881 |
Stock Price | $ / shares | $ 27 |
Stock Compensation | $ | $ 985,468 |
Accelerated development milestone | |
SHARE- BASED COMPENSATION | |
Percentage of O/S Shares | 2% |
Shares O/S | 2,484,730 |
Shares issued during the period | 49,695 |
Stock Price | $ / shares | $ 27 |
Stock Compensation | $ | $ 1,327,840 |
ACCRUED EXPENSES AND OTHER CU_3
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Details) - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | ||
Accrued expense - other | $ 34,397,209 | $ 3,529,384 |
IRS Tax Liability | 2,849,346 | 1,744,707 |
Accrued payroll | 2,406,650 | 534,782 |
Accrued interest | 1,548,724 | 1,377,008 |
Total | $ 41,201,929 | $ 7,185,881 |
LIABILITY TO ISSUE STOCK (Detai
LIABILITY TO ISSUE STOCK (Details) - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
Schedule of Liability to Issue Stock [Line items] | ||
Liability to issue shares | $ 9,935,950 | $ 10,710,000 |
Liability to issue shares, net of current portion | 1,827,889 | |
CEO | ||
Schedule of Liability to Issue Stock [Line items] | ||
Liability to issue shares | 9,900,000 | |
Liability to issue shares, net of current portion | $ 1,800,000 |
PROPERTY, PLANT, AND EQUIPMEN_3
PROPERTY, PLANT, AND EQUIPMENT, NET (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Property, Plant and Equipment [Line Items] | ||
Total cost of assets excluding accumulated impairment | $ 86,988,028 | $ 17,703,144 |
Less: Accumulated Depreciation | (4,955,243) | (2,899,428) |
Property, Plant, and Equipment, Net | 82,032,785 | 14,803,716 |
Depreciation | 8,023,596 | 379,256 |
Impairment loss | 14,770,000 | |
Accumulated depreciation | 5,969,367 | |
Mullen/ELMS | ||
Property, Plant and Equipment [Line Items] | ||
Impairment loss | 13,519,492 | |
Buildings | ||
Property, Plant and Equipment [Line Items] | ||
Total cost of assets excluding accumulated impairment | 48,081,466 | 7,659,121 |
Machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total cost of assets excluding accumulated impairment | 27,861,452 | 7,383,612 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Total cost of assets excluding accumulated impairment | 3,040,303 | 647,576 |
Construction-in-progress | ||
Property, Plant and Equipment [Line Items] | ||
Total cost of assets excluding accumulated impairment | 5,180,642 | 269,778 |
Other fixed assets | ||
Property, Plant and Equipment [Line Items] | ||
Total cost of assets excluding accumulated impairment | $ 2,824,165 | $ 1,743,057 |
OTHER NON-CURRENT ASSETS (Detai
OTHER NON-CURRENT ASSETS (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
OTHER NON-CURRENT ASSETS | ||
Impairment of other assets | $ 1,250,508 | |
Depreciation of other assets | 1,762,415 | $ 587,684 |
Other assets | 81,589 | |
Show room vehicles | 2,982,986 | |
Security deposits | 960,502 | 281,056 |
Total Other Assets | $ 960,502 | $ 3,345,631 |
OPERATING EXPENSES (Details)
OPERATING EXPENSES (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
OPERATING EXPENSES | ||
Professional fees | $ 36,374,957 | $ 46,224,690 |
Compensation to employees | 94,140,300 | 13,714,669 |
Depreciation | 9,786,011 | 966,940 |
Amortization | 6,602,288 | 888,774 |
Lease | 1,429,110 | 2,145,648 |
Settlements and penalties | 36,196,538 | 1,134,707 |
Employee benefits | 4,014,915 | 2,107,793 |
Utilities and office expense | 4,620,425 | 511,899 |
Advertising and promotions | 8,443,311 | 4,407,764 |
Taxes and licenses | 442,279 | (284,854) |
Repairs and maintenance | 1,128,266 | 392,679 |
Executive expenses and directors' fees | 699,133 | 482,455 |
Listing and regulatory fees | 6,042,474 | 1,546,810 |
Outside labor | 352,201 | |
Other | 5,926,125 | 746,081 |
Total | $ 215,846,132 | $ 75,338,256 |
OPERATING EXPENSES - Research a
OPERATING EXPENSES - Research and development (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Research & Development | ||
Research and development | $ 77,387,336 | $ 21,650,840 |
LEASES - Lease assets and liabi
LEASES - Lease assets and liabilities (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Assets: | ||
Operating lease right-of-use assets | $ 5,249,417 | $ 4,597,052 |
Liabilities: | ||
Operating lease liabilities, current | (2,134,494) | (1,428,474) |
Operating lease liabilities, non-current | (3,566,922) | (3,359,354) |
Total lease liabilities | $ (5,701,416) | $ (4,787,828) |
Weighted average remaining lease terms: Operating leases | 3 years 11 months 23 days | 2 years 7 months 17 days |
Weighted average discount rate: Operating leases | 28% | 28% |
Cash paid for amounts included in the measurement of lease liabilities for the fiscal year ended September 30, 2023, and 2022 | $ 3,168,567 | $ 1,751,680 |
LEASES - Operating lease costs
LEASES - Operating lease costs (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Operating lease costs: | ||
Fixed lease cost | $ 3,318,326 | $ 1,718,424 |
Variable lease cost | 250,499 | 496,914 |
Short-term lease cost | 164,690 | |
Sublease income | (362,126) | (293,511) |
Total operating lease costs | $ 3,206,699 | $ 2,086,517 |
LEASES - Maturities of operatin
LEASES - Maturities of operating lease liabilities (Details) - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
Year ending December 31, | ||
2024 | $ 3,135,400 | |
2025 | 2,639,884 | |
2026 | 803,759 | |
2027 | 584,468 | |
2028 | 206,919 | |
Thereafter | 1,579,534 | |
Total lease payments | 8,949,964 | |
Less: imputed interest | (3,248,548) | |
Present value of lease liabilities | $ 5,701,416 | $ 4,787,828 |
LEASES - Additional Information
LEASES - Additional Information (Details) | 12 Months Ended |
Sep. 30, 2023 | |
Lessee, Lease, Description [Line Items] | |
Option to extend | true |
Option to terminate | true |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Operating lease term | 1 year |
Renewal term | 1 year |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Operating lease term | 3 years |
Renewal term | 5 years |
INCOME TAXES - Additional Infor
INCOME TAXES - Additional Information (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Operating Loss Carryforwards [Line Items] | ||
Loss before income taxes | $ (1,017,647,310) | $ (740,323,152) |
Income tax NOL carryforwards | $ 118,886,728 | $ 78,791,906 |
Federal statutory tax rate | 21% | 21% |
Federal | ||
Operating Loss Carryforwards [Line Items] | ||
Income tax NOL carryforwards | $ 480,891,280 | $ 341,364,602 |
California | ||
Operating Loss Carryforwards [Line Items] | ||
Income tax NOL carryforwards | $ 473,427,974 | $ 318,862,714 |
INCOME TAXES - Total provision
INCOME TAXES - Total provision (benefit) for income taxes (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Current | ||
State | $ 2,400 | $ 1,600 |
Total | 2,400 | 1,600 |
Deferred | ||
Federal | (10,990,882) | (280,552) |
Total | (10,990,882) | (280,552) |
Total provision (benefit) for income taxes | $ (10,988,482) | $ (278,952) |
INCOME TAXES - Summary of Incom
INCOME TAXES - Summary of Income Tax NOL carryforwards (Details) - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
Operating Loss Carryforwards [Line Items] | ||
Net operating loss carryforwards | $ 118,886,728 | $ 78,791,906 |
Federal | ||
Operating Loss Carryforwards [Line Items] | ||
Net operating loss carryforwards | 480,891,280 | 341,364,602 |
Federal | 2034-2037 | ||
Operating Loss Carryforwards [Line Items] | ||
Net operating loss carryforwards | 29,838,716 | 29,838,716 |
Federal | Indefinite | ||
Operating Loss Carryforwards [Line Items] | ||
Net operating loss carryforwards | 451,052,564 | 311,525,886 |
California | ||
Operating Loss Carryforwards [Line Items] | ||
Net operating loss carryforwards | 473,427,974 | 318,862,714 |
California | 2034-2040 | ||
Operating Loss Carryforwards [Line Items] | ||
Net operating loss carryforwards | $ 473,427,974 | $ 318,862,714 |
INCOME TAXES - Summary of Recon
INCOME TAXES - Summary of Reconciliation of Our Effective Tax Rate To Statutory Federal Tax Rate (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Effective Income Tax Rate Reconciliation, Amount | ||
Income tax benefit at statutory rate | $ (213,705,935) | $ (155,466,389) |
State income taxes | 2,400 | 1,600 |
Permanent differences | 155,268,652 | 995,227 |
Valuation allowance | 49,635,916 | 154,180,328 |
Federal Return to Provision True up | (2,269,617) | |
Other | 80,102 | 10,282 |
Total provision (benefit) for income taxes | $ (10,988,482) | $ (278,952) |
Effective Income Tax Rate Reconciliation, Percent | ||
Income tax benefit at statutory rate | 21% | 21% |
State income taxes | 0% | 0% |
Permanent Differences | (15.00%) | (0.13%) |
Valuation Allowance | (5.00%) | (20.83%) |
Federal Return to Provision True up | 0% | 0% |
Other | 0% | 0% |
Total (benefit) provision for income taxes | 1% | 0.04% |
INCOME TAXES - Summary of Signi
INCOME TAXES - Summary of Significant Component of Net Deferred Tax Assets (Details) - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
Deferred tax assets: | ||
Stock compensation | $ 10,327,117 | $ 8,442 |
Net operating loss carryforwards | 118,886,728 | 78,791,906 |
Charitable contributions | 2,680 | 1,219 |
Accrued expenses | 414,745 | 86,926 |
Other assets | 413,579 | 426,099 |
Intangibles | 48,382,778 | |
163(j) limitation | 15,971,671 | 14,522,536 |
Research expenditures | 16,077,633 | |
Mark-to-market warrants | 121,545,414 | |
Total gross deferred tax assets | 162,094,153 | 263,765,320 |
R&D tax credits | 7,353,043 | 578,842 |
Less valuation allowance | (155,435,630) | (258,903,457) |
Total net deferred tax assets | 14,011,566 | 5,440,705 |
Deferred tax liabilities: | ||
Intangibles | (16,358,329) | (19,428,527) |
Fixed assets | (1,545,473) | (969,201) |
Other | 336 | (336) |
Total deferred tax liabilities | (17,903,466) | (20,398,064) |
Net deferred tax assets | $ (3,891,900) | $ (14,957,359) |
CONTINGENCIES AND CLAIMS (Detai
CONTINGENCIES AND CLAIMS (Details) - USD ($) | Dec. 15, 2023 | Sep. 30, 2023 | Aug. 03, 2023 |
GEM Group | |||
CONTINGENCIES AND CLAIMS | |||
Loss contingencies accrued | $ 7,000,000 | ||
GEM Group | Pending Litigation | |||
CONTINGENCIES AND CLAIMS | |||
Escrow deposit | $ 7,000,000 | ||
GEM Group | Pending Litigation | Subsequent event | |||
CONTINGENCIES AND CLAIMS | |||
Escrow deposit | $ 29,114,921 | ||
Trinon Coleman v. David Michery et al | |||
CONTINGENCIES AND CLAIMS | |||
Loss contingencies accrued | 0 | ||
Jeff Witt v. Mullen Automotive, Inc. | |||
CONTINGENCIES AND CLAIMS | |||
Loss contingencies accrued | 0 | ||
Margaret Schaub v. Mullen Automotive, Inc. | |||
CONTINGENCIES AND CLAIMS | |||
Loss contingencies accrued | 0 | ||
Chosten Caris V David Michery | |||
CONTINGENCIES AND CLAIMS | |||
Loss contingencies accrued | $ 0 |
CONTINGENCIES AND CLAIMS - Qian
CONTINGENCIES AND CLAIMS - Qiantu Motor (Suzhou) Ltd. (Details) | Mar. 14, 2023 USD ($) item shares | Sep. 30, 2023 USD ($) |
Qiantu Warrants | ||
Other Commitments [Line Items] | ||
Number of intellectual property agreement | item | 2 | |
Period to use the license under intellectual property agreement | 5 years | |
Market price of the Company's common shares | 110% | |
Qiantu Motor (Suzhou) Ltd. | ||
Other Commitments [Line Items] | ||
Litigation owed | $ 6,000,000 | |
Period for assessment of feasibility and profitability | 150 days | |
Amount payable for deliverable items | $ 2,000,000 | |
Amount of royalty fee payable | $ 1,200 | |
Loss contingencies accrued | $ 0 | |
Qiantu Motor (Suzhou) Ltd. | Qiantu Warrants | ||
Other Commitments [Line Items] | ||
Warrants to acquire shares of common stock | shares | 3,334 | |
Market price of the Company's common shares | 110% |
CONTINGENCIES AND CLAIMS - Inte
CONTINGENCIES AND CLAIMS - International Business Machines (Details) - Lawsuit with IBM - USD ($) | 12 Months Ended | ||
Feb. 02, 2022 | Dec. 01, 2021 | Sep. 30, 2022 | |
CONTINGENCIES AND CLAIMS | |||
Amount of judgment | $ 5,617,192 | ||
Cash transferred to surety bonds to cover legal liability | $ 5,900,000 | ||
Losses on settlement | $ (5,900,000) |
CONTINGENCIES AND CLAIMS - TOA
CONTINGENCIES AND CLAIMS - TOA Trading LLC Litigation (Details) - TOA Trading LLC Litigation - USD ($) $ in Millions | Sep. 30, 2023 | Apr. 11, 2022 |
Loss Contingencies [Line Items] | ||
Estimate of damages | $ 15 | |
Loss contingencies accrued | $ 0 |
CONTINGENCIES AND CLAIMS - DBI
CONTINGENCIES AND CLAIMS - DBI Lease Buyback Servicing LLC, Drawbridge Investments LLC (Details) | 1 Months Ended | 12 Months Ended | ||||
Mar. 02, 2023 USD ($) claim shares | Jun. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) shares | Jan. 25, 2023 shares | Jan. 24, 2023 shares | Sep. 30, 2022 USD ($) shares | |
CONTINGENCIES AND CLAIMS | ||||||
Debt discount | $ 270,189 | $ 932,235 | ||||
Common Stock, shares authorized | shares | 5,000,000,000 | 5,000,000,000 | 1,750,000,000 | 1,750,000,000 | ||
DBI Lease Buyback Servicing LLC, Drawbridge Investments LLC | ||||||
CONTINGENCIES AND CLAIMS | ||||||
Number of Claims | claim | 3 | |||||
Debt discount | $ 3,500,000 | |||||
Damages in Drawbridge assets | $ 100,000,000 | |||||
Litigation settlement, amount | $ 1,950,000 | |||||
Minimum | DBI Lease Buyback Servicing LLC, Drawbridge Investments LLC | ||||||
CONTINGENCIES AND CLAIMS | ||||||
Common Stock, shares authorized | shares | 500,000,000 | |||||
Series E Preferred Stock Purchase Option | Series E Preferred Stock | DBI Lease Buyback Servicing LLC, Drawbridge Investments LLC | ||||||
CONTINGENCIES AND CLAIMS | ||||||
Option to purchase maximum value of stock and warrants. | $ 25,000,000 |
RELATED PARTY TRANSACTIONS - Co
RELATED PARTY TRANSACTIONS - Correction of Related Party Disclosures (Details) | 12 Months Ended | ||
Nov. 05, 2021 employee | Sep. 30, 2022 USD ($) employee | Sep. 30, 2023 USD ($) | |
Related Party Transaction [Line Items] | |||
Balance of advance receivable | $ 1,232,387 | $ 2,250,489 | |
Mullen Technologies, Inc. | |||
Related Party Transaction [Line Items] | |||
Balance of advance receivable | 1,232,387 | $ 2,250,489 | |
Related Party | Transition Services Agreement | Mullen Technologies, Inc. | |||
Related Party Transaction [Line Items] | |||
Balance of advance receivable | $ 1,200,000 | ||
Number of employees that provided services only to related party | employee | 11 | 11 | |
Interest on the unpaid receivable balance | $ 100,000 | ||
Related Party | Transition Services Agreement | Mullen Technologies, Inc. | Prime rate | |||
Related Party Transaction [Line Items] | |||
Spread on variable rate of advance receivable (as a percent) | 1% | 1% |
RELATED PARTY TRANSACTIONS - Re
RELATED PARTY TRANSACTIONS - Related Party Note Receivable (Details) | 12 Months Ended | ||||
Mar. 31, 2023 USD ($) | Jan. 16, 2023 USD ($) | Nov. 05, 2021 employee | Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) employee | |
Related Party Transaction [Line Items] | |||||
Amounts collected for the funds advanced | $ 2,700,000 | ||||
Mullen Technologies, Inc. | |||||
Related Party Transaction [Line Items] | |||||
Increase in principal amount of notes receivable | $ 839,045 | $ 1,232,387 | |||
Related Party | Transition Services Agreement | Mullen Technologies, Inc. | |||||
Related Party Transaction [Line Items] | |||||
Number of employees that provided services only to related party | employee | 11 | 11 | |||
Disbursements on behalf of related party | 900,000 | $ 1,200,000 | |||
Amounts collected for the funds advanced | $ 0 | ||||
Conversion of accounts receivable to note receivable | $ 1,400,000 | ||||
Related party transaction rate | 10% | ||||
Default rate (as a percent) | 15% | ||||
Increase in principal amount of notes receivable | $ 400,000 | ||||
Related Party | Transition Services Agreement | Mullen Technologies, Inc. | Prime rate | |||||
Related Party Transaction [Line Items] | |||||
Spread on variable rate of advance receivable (as a percent) | 1% | 1% |
RELATED PARTY TRANSACTIONS - Su
RELATED PARTY TRANSACTIONS - Summary of Advances Receivable from Related Party (Details) - USD ($) | 12 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2021 | |
Related party transactions | |||
Beginning balance | $ 1,232,387 | ||
Financing Receivable, after Allowance for Credit Loss, Noncurrent, Related Party, Type [Extensible Enumeration] | Related Party | Related Party | |
Ending balance | $ 2,250,489 | $ 1,232,387 | |
Mullen Technologies, Inc. | |||
Related party transactions | |||
Beginning balance | $ 1,232,387 | ||
Financing Receivable, after Allowance for Credit Loss, Noncurrent, Related Party, Type [Extensible Enumeration] | Related Party | Related Party | Related Party |
Additions | $ 839,045 | $ 1,232,387 | |
Accrued interest | 179,057 | ||
Ending balance | 2,250,489 | 1,232,387 | |
Mullen Technologies, Inc. | Advances | |||
Related party transactions | |||
Beginning balance | 1,232,387 | ||
Additions | 392,954 | 1,232,387 | |
Conversion | (1,388,405) | ||
Ending balance | 236,936 | $ 1,232,387 | |
Mullen Technologies, Inc. | Interest on advances | |||
Related party transactions | |||
Accrued interest | 91,030 | ||
Ending balance | 91,030 | ||
Mullen Technologies, Inc. | Note | |||
Related party transactions | |||
Additions | 446,091 | ||
Conversion | 1,388,405 | ||
Ending balance | 1,834,496 | ||
Mullen Technologies, Inc. | Interest on note | |||
Related party transactions | |||
Accrued interest | 88,027 | ||
Ending balance | $ 88,027 |
RELATED PARTY TRANSACTION - Dir
RELATED PARTY TRANSACTION - Director Provided Services (Details) - Non-employee director | Sep. 30, 2023 USD ($) |
Related Party Transaction [Line Items] | |
Compensation service on board of directors in cash | $ 287,000 |
Compensation service on board of directors in shares of common Stock | $ 487,500 |
RELATED PARTY TRANSACTIONS - Wi
RELATED PARTY TRANSACTIONS - William Miltner (Details) | 12 Months Ended |
Sep. 30, 2023 USD ($) | |
Related Party | William Miltner | |
Related Party Transaction [Line Items] | |
Amount paid for legal services | $ 1,058,105 |
RELATED PARTY TRANSACTIONS - Ma
RELATED PARTY TRANSACTIONS - Mary Winter (Details) - USD ($) | 12 Months Ended | ||
Oct. 26, 2021 | Sep. 30, 2023 | Sep. 30, 2022 | |
Related Party Transaction [Line Items] | |||
Consulting payments | $ 36,374,957 | $ 46,224,690 | |
Consulting agreements | Mary Winters, Corporate Secretary and Director | |||
Related Party Transaction [Line Items] | |||
Annual salary under agreement | $ 60,000 | ||
Monthly salary under agreement | $ 5,000 | ||
Consulting payments | $ 60,000 |
SEGMENT INFORMATION - Additiona
SEGMENT INFORMATION - Additional Information (Details) - segment | 12 Months Ended | |
Sep. 30, 2023 | Sep. 07, 2022 | |
SEGMENT INFORMATION | ||
Number of operating segment | 2 | |
Bollinger Motors, Inc | ||
SEGMENT INFORMATION | ||
Business acquisition, percentage of voting interests acquired | 60% |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) - USD ($) | 12 Months Ended | ||
Sep. 01, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | |
SEGMENT INFORMATION | |||
Revenues | $ 366,000 | ||
Interest expenses | (4,993,140) | $ (26,949,081) | |
Depreciation and amortization expense | (16,388,299) | (3,282,285) | |
Impairment of goodwill | $ (63,988,000) | (63,988,000) | |
Impairment of intangible assets | (5,873,000) | ||
Income tax benefit/(expense) | 10,988,482 | 278,952 | |
Other significant noncash items: | |||
Stock-based compensation | (85,441,869) | (43,715,242) | |
Revaluation of derivative liabilities | (116,256,212) | (122,803,715) | |
Initial recognition of derivative liabilities | (506,238,038) | (484,421,258) | |
Non-cash interest and other operating activities | 199,998 | 13,883,637 | |
Non-cash financing loss on over-exercise of warrants | (8,934,892) | ||
Loss on extinguishment of debt | (6,246,089) | 33,413 | |
Amortization of debt discount | (662,047) | (19,595,915) | |
Net loss | (1,006,658,828) | (740,324,752) | |
Total segment assets | 421,705,730 | 302,594,479 | |
Operating Segments | |||
SEGMENT INFORMATION | |||
Revenues | 366,000 | ||
Interest gains | 2,269,743 | ||
Interest expenses | (4,993,140) | (26,949,081) | |
Depreciation and amortization expense | (16,388,299) | (3,282,285) | |
Impairment of property, plant, and equipment | (14,770,000) | ||
Impairment of goodwill | (63,988,000) | ||
Impairment of intangible assets | (5,873,000) | ||
Income tax benefit/(expense) | 10,988,482 | ||
Other significant noncash items: | |||
Stock-based compensation | (85,441,869) | (43,715,242) | |
Revaluation of derivative liabilities | (116,256,212) | (122,803,715) | |
Initial recognition of derivative liabilities | (513,052,038) | (484,421,258) | |
Non-cash interest and other operating activities | (13,883,637) | ||
Non-cash financing loss on over-exercise of warrants | (8,934,892) | ||
Loss on extinguishment of debt | (6,246,089) | ||
Amortization of debt discount | (19,595,915) | ||
Net loss | (1,006,658,828) | (740,324,752) | |
Total segment assets | 421,705,730 | 302,594,478 | |
Expenditures for segment's long-lived assets (property, plant, and equipment, and intangible assets) | (107,923,309) | (47,154,109) | |
Operating Segments | Dealer | |||
SEGMENT INFORMATION | |||
Revenues | 308,000 | ||
Operating Segments | Bollinger | |||
SEGMENT INFORMATION | |||
Interest gains | 1,585,376 | ||
Interest expenses | (88,580) | ||
Depreciation and amortization expense | (3,808,877) | (605,216) | |
Impairment of goodwill | (63,988,000) | ||
Income tax benefit/(expense) | 10,990,882 | ||
Other significant noncash items: | |||
Net loss | (83,285,117) | (1,979,865) | |
Total segment assets | 169,410,298 | 230,498,634 | |
Expenditures for segment's long-lived assets (property, plant, and equipment, and intangible assets) | (4,677,421) | ||
Operating Segments | Mullen/ELMS | |||
SEGMENT INFORMATION | |||
Revenues | 366,000 | ||
Interest gains | 684,367 | ||
Interest expenses | (4,904,560) | (26,949,081) | |
Depreciation and amortization expense | (12,579,422) | (2,677,069) | |
Impairment of property, plant, and equipment | (14,770,000) | ||
Impairment of intangible assets | (5,873,000) | ||
Income tax benefit/(expense) | (2,400) | ||
Other significant noncash items: | |||
Stock-based compensation | (85,441,869) | (43,715,242) | |
Revaluation of derivative liabilities | (116,256,212) | (122,803,715) | |
Initial recognition of derivative liabilities | (513,052,038) | (484,421,258) | |
Non-cash interest and other operating activities | (13,883,637) | ||
Non-cash financing loss on over-exercise of warrants | (8,934,892) | ||
Loss on extinguishment of debt | (6,246,089) | ||
Amortization of debt discount | (19,595,915) | ||
Net loss | (923,373,711) | (738,344,887) | |
Total segment assets | 252,295,433 | 72,095,844 | |
Expenditures for segment's long-lived assets (property, plant, and equipment, and intangible assets) | $ (103,245,888) | $ (47,154,109) |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) | 1 Months Ended | 12 Months Ended | |||||||||||||
Jan. 22, 2024 $ / shares | Dec. 21, 2023 shares | Dec. 18, 2023 USD ($) | Nov. 30, 2023 | Nov. 01, 2023 USD ($) ft² shares | Aug. 11, 2023 | May 04, 2023 | Jan. 16, 2023 USD ($) | Dec. 31, 2023 | Aug. 31, 2023 | Jan. 31, 2023 | Sep. 30, 2022 $ / shares shares | Sep. 30, 2023 USD ($) $ / shares shares | Sep. 30, 2022 USD ($) $ / shares | Oct. 01, 2023 shares | |
SUBSEQUENT EVENTS | |||||||||||||||
Property operating expense per year | $ 1,429,110 | $ 2,145,648 | |||||||||||||
Common Stock, par value | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | ||||||||||||
Reverse stock ratio | 0.11 | 0.04 | 0.01 | 0.04 | |||||||||||
Fractional shares | shares | 0 | ||||||||||||||
Amounts collected for the funds advanced | $ 2,700,000 | ||||||||||||||
Series D Preferred Stock | |||||||||||||||
SUBSEQUENT EVENTS | |||||||||||||||
Number of shares issued (in shares) | shares | 79,926,925 | ||||||||||||||
Minimum | |||||||||||||||
SUBSEQUENT EVENTS | |||||||||||||||
Operating lease term | 1 year | ||||||||||||||
Maximum | |||||||||||||||
SUBSEQUENT EVENTS | |||||||||||||||
Operating lease term | 3 years | ||||||||||||||
Subsequent event | |||||||||||||||
SUBSEQUENT EVENTS | |||||||||||||||
Reverse stock ratio | 0.01 | 0.01 | 0.01 | ||||||||||||
Fractional shares | shares | 0 | ||||||||||||||
Additional shares issued for benefit of shareholders | shares | 321,036 | ||||||||||||||
Number of shares registration of common stock related to warrants issued shares | shares | 1,030,097 | ||||||||||||||
Capital market closing bid price | $ / shares | $ 1 | ||||||||||||||
Capital market consecutive trading days | 20 days | ||||||||||||||
Subsequent event | Non-convertible secured promissory note | |||||||||||||||
SUBSEQUENT EVENTS | |||||||||||||||
Principal amount | $ 50,000,000 | ||||||||||||||
Proceeds from financing | 32,000,000 | ||||||||||||||
Original Issue Discount | $ 18,000,000 | ||||||||||||||
Interest rate (as a percent) | 10% | ||||||||||||||
Default interest rate | 18% | ||||||||||||||
Maturity term | 3 months | ||||||||||||||
Subsequent event | Series D Preferred Stock | |||||||||||||||
SUBSEQUENT EVENTS | |||||||||||||||
Shares issuable upon conversion of Series D Preferred Stock | shares | 3,012,986 | ||||||||||||||
Shares issuable upon exercise of outstanding warrants | shares | 279,404 | ||||||||||||||
Subsequent event | Minimum | |||||||||||||||
SUBSEQUENT EVENTS | |||||||||||||||
Reverse stock ratio | 0.5 | 0.5 | |||||||||||||
Incorporating earlier amendments, make significant changes to stockholder nomination procedures | 90 days | ||||||||||||||
Subsequent event | Maximum | |||||||||||||||
SUBSEQUENT EVENTS | |||||||||||||||
Reverse stock ratio | 0.01 | 0.01 | |||||||||||||
Incorporating earlier amendments, make significant changes to stockholder nomination procedures | 120 days | ||||||||||||||
Subsequent event | Fullerton, California Premises [Member] | |||||||||||||||
SUBSEQUENT EVENTS | |||||||||||||||
Operating lease term | 5 years | ||||||||||||||
Area of land given on lease (sq. ft) | ft² | 122,000 | ||||||||||||||
Annual base rent for first year | $ 2,992,000 | ||||||||||||||
Annual rent increase (as a percent) | 4% | ||||||||||||||
Property operating expense per year | $ 715,000 | ||||||||||||||
Security deposit | $ 1,000,000 |