Cover
Cover - shares | 3 Months Ended | |
Dec. 31, 2021 | Feb. 14, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Dec. 31, 2021 | |
Document Transition Report | false | |
Entity File Number | 000-55591 | |
Entity Registrant Name | LOOP MEDIA, INC. | |
Entity Incorporation, State Code | NV | |
Entity Tax Identification Number | 47-3975872 | |
Entity Address, Address Line One | 700 N. Central Ave. | |
Entity Address, Address Line Two | Suite 430 | |
Entity Address, City or Town | Glendale | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 91203 | |
City Area Code | 818 | |
Local Phone Number | 823-4801 | |
Entity Reporting Status Current | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 133,470,141 | |
Entity Central Index Key | 0001643988 | |
Current Fiscal Year End Date | --09-30 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2022 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2021 | Sep. 30, 2021 |
Current assets | ||
Cash | $ 1,662,098 | $ 4,162,548 |
Accounts receivable, net | 2,924,484 | 1,571,226 |
Inventory | 114,723 | 223,048 |
Prepaid expenses and other current assets | 465,590 | 1,645,037 |
Prepaid income tax | 19,648 | 17,806 |
License content assets - current | 539,208 | 850,263 |
Total current assets | 5,725,751 | 8,469,928 |
Non-current assets | ||
Deposits | 63,879 | 34,289 |
License content assets - non current | 365,360 | 365,360 |
Equipment, net | 34,644 | 38,936 |
Operating lease right-of-use assets | 198,539 | 237,094 |
Intangible assets, net | 674,667 | 702,778 |
Goodwill | 1,970,321 | 1,970,321 |
Total non-current assets | 3,307,410 | 3,348,778 |
Total assets | 9,033,161 | 11,818,706 |
Current liabilities | ||
Accounts payable and accrued liabilities | 3,287,903 | 2,215,906 |
Payable on acquisition | 250,125 | 250,125 |
License content liabilities - current | 404,000 | 985,000 |
Note payable - current | 25,714 | |
Deferred Income | 178,549 | 191,331 |
Convertible debt related party - current, net | 2,305,211 | 530,226 |
Convertible debt - current, net | 446,251 | |
Lease liability - current | 170,533 | 167,101 |
Total current liabilities | 7,042,572 | 4,365,403 |
Non-current liabilities | ||
Convertible debt - related party, less current portion, net | 726,838 | 1,619,398 |
Convertible debt, less current portion, net | 1,243,115 | |
Note payable - non-current | 460,924 | |
Derivative liability | 959,888 | 1,058,633 |
Lease liability | 32,749 | 75,530 |
Total non-current liabilities | 1,719,475 | 4,457,600 |
Total liabilities | 8,762,047 | 8,823,003 |
Stockholders' equity | ||
Common Stock, $0.0001 par value, 316,666,667 shares authorized,133,470,019 and 133,470,019 shares issued and outstanding as of December 31, 2021 and September 30, 2021, respectively | 13,345 | 13,345 |
Additional paid in capital | 71,374,160 | 69,824,754 |
Accumulated deficit | (71,116,411) | (66,842,416) |
Total stockholders' equity | 271,114 | 2,995,703 |
Total liabilities and stockholders' equity | 9,033,161 | 11,818,706 |
Series B Convertible Preferred Stock [Member] | ||
Stockholders' equity | ||
Preferred stock | $ 20 | $ 20 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2021 | Sep. 30, 2021 | Dec. 31, 2020 |
Preferred stock, par value (in dollars per share) | $ 0.0001 | ||
Preferred stock, authorized | 16,666,667 | ||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | |
Common stock, authorized | 316,666,667 | 316,666,667 | |
Common stock, issued | 133,470,020 | 133,470,020 | 116,800,982 |
Common stock, outstanding | 133,470,019 | 133,470,019 | 116,800,982 |
Series B Convertible Preferred Stock [Member] | |||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | |
Preferred stock, authorized | 3,333,334 | 3,333,334 | |
Preferred stock, issued | 200,000 | 200,000 | |
Preferred stock, outstanding | 200,000 | 200,000 | |
Liquidation preference | $ 1.50 | $ 1.50 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||
Revenue | $ 2,996,034 | $ 705,168 |
Cost of revenue | 1,444,977 | 462,042 |
Gross profit | 1,551,057 | 243,126 |
Operating expenses | ||
Selling, general and administrative | 5,909,680 | 3,036,298 |
Impairment of goodwill and intangibles | 2,390,799 | |
Total operating expenses | 5,909,680 | 5,427,097 |
Loss from operations | (4,358,623) | (5,183,971) |
Other income (expense) | ||
Interest income | 200 | 2,996 |
Interest expense | (504,117) | (395,905) |
Gain on extinguishment of debt, net | 490,051 | 13,900 |
Loss on settlement of obligation | (15,000) | |
Change in fair value of derivatives | 98,745 | |
Total other income (expense) | 84,879 | (394,009) |
Income tax (expense)/benefit | (251) | (98,244) |
Net loss | (4,273,995) | (5,676,224) |
Net loss attributable to common stockholders | $ (4,273,995) | $ (5,676,224) |
Basic net loss per common share (in dollars per share) | $ (0.03) | $ (0.05) |
Diluted net loss per common share (in dollars per share) | $ (0.03) | $ (0.05) |
Weighted average number of basic common shares outstanding (in shares) | 133,470,020 | 116,800,982 |
Weighted average number of diluted common shares outstanding (in shares) | 133,470,020 | 116,800,982 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) | Common Stock | Preferred StockSeries A Convertible Preferred Stock [Member] | Preferred StockSeries B Convertible Preferred Stock [Member] | Common stock subscriptions | Additional Paid in Capital. | Accumulated Deficit | Total |
Balance at beginning at Sep. 30, 2020 | $ 11,432 | $ 3 | $ 20 | $ 135,144 | $ 36,669,899 | $ (35,867,920) | $ 1,156,299 |
Balance at beginning (in shares) at Sep. 30, 2020 | 114,320,911 | 30,667 | 200,000 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Shares issued for cash | $ 75 | 899,925 | $ 900,000 | ||||
Shares issued for cash (in shares) | 757,333 | 704,000 | |||||
Cash received for common stock subscribed | 330,000 | $ 330,000 | |||||
Issuance of common stock subscribed | $ (5) | 20,000 | (19,995) | ||||
Issuance of common stock subscribed (in shares) | (53,333) | ||||||
Shares issued in conjunction with reverse merger | (1) | (1) | |||||
Shares issued for asset purchase | $ 137 | 2,671,096 | 2,671,233 | ||||
Shares issued for asset purchase (in shares) | 1,369,863 | ||||||
Beneficial conversion feature of convertible debenture | 750,000 | 750,000 | |||||
Stock-based compensation | 134,253 | 134,253 | |||||
Warrants issued to consultant | 492,000 | 492,000 | |||||
Shares issued for investment in unconsolidated entity | $ 10 | 194,793 | $ 194,803 | ||||
Shares issued for debt settlement (in shares) | 97,891 | 97,891 | |||||
Shares issued for license content assets | $ 118 | 2,065,878 | $ 2,065,996 | ||||
Shares issued for license content asset (in shares) | 1,180,880 | ||||||
Shares issued for equity investment in unconsolidated entity | $ 46 | 863,434 | 863,480 | ||||
Shares issued for equity investment in unconsolidated entity (in shares) | 454,463 | ||||||
Net loss | (5,676,224) | (5,676,224) | |||||
Balance at ending at Dec. 31, 2020 | $ 11,813 | $ 3 | $ 20 | 485,144 | 44,721,282 | (41,544,144) | 3,881,839 |
Balance at ending (in shares) at Dec. 31, 2020 | 118,128,008 | 30,667 | 200,000 | ||||
Balance at beginning at Sep. 30, 2020 | $ 11,432 | $ 3 | $ 20 | $ 135,144 | 36,669,899 | (35,867,920) | 1,156,299 |
Balance at beginning (in shares) at Sep. 30, 2020 | 114,320,911 | 30,667 | 200,000 | ||||
Balance at ending at Sep. 30, 2021 | $ 13,345 | $ 20 | 69,824,754 | (66,842,416) | 2,995,703 | ||
Balance at ending (in shares) at Sep. 30, 2021 | 133,470,018 | 200,000 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Stock-based compensation | 1,549,406 | 1,549,406 | |||||
Warrants issued for severance | 492,000 | ||||||
Net loss | (4,273,995) | (4,273,995) | |||||
Balance at ending at Dec. 31, 2021 | $ 13,345 | $ 20 | $ 71,374,160 | $ (71,116,411) | $ 271,114 | ||
Balance at ending (in shares) at Dec. 31, 2021 | 133,470,018 | 200,000 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 3 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net loss | $ (4,273,995) | $ (5,676,224) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Amortization of debt discount | 358,248 | 183,533 |
Depreciation and amortization expense | 32,403 | 338,260 |
Amortization of license contract assets | 311,055 | 173,169 |
Amortization of right-of-use assets | 38,555 | 34,860 |
Bad debt expense | 20,000 | 62,154 |
Gain on extinguishment of debt | (490,051) | (13,900) |
Change in fair value of derivative | (98,745) | |
Warrants issued for consulting services | 492,000 | |
Stock-based compensation | 1,549,406 | 134,253 |
Loss on settlement of obligations | 15,000 | |
Impairment of intangible assets | 2,390,799 | |
Accounts receivable | (1,373,259) | 49,106 |
Prepaid income tax | (1,842) | 98,244 |
Inventory | 108,325 | (51,225) |
Prepaid expenses | (70,555) | 15,954 |
Deposit | (29,590) | 4,182 |
Accounts payable and accrued liabilities | 1,075,413 | 42,294 |
License content liability | (581,000) | 955,500 |
License contract asset | (1,567,500) | |
Operating lease liabilities | (39,349) | (34,502) |
Deferred income | (12,782) | 27,009 |
NET CASH USED IN OPERATING ACTIVITIES | (3,477,763) | (2,327,034) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Acquisition of EON Media Group, net of cash acquired | (750,000) | |
Purchase of equipment | 2,752 | |
Collection of note receivable | 1,477 | |
NET CASH USED IN INVESTING ACTIVITIES | (745,771) | |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from issuance of common stock | 1,250,000 | 880,000 |
Proceeds from issuance of convertible debt | 750,000 | |
Repayment of stockholder loans | (272,687) | (40,956) |
Proceeds from issuing common stock subscribed | 350,000 | |
NET CASH PROVIDED BY FINANCING ACTIVITIES | 977,313 | 1,939,044 |
Change in cash and cash equivalents | (2,500,450) | (1,133,761) |
Cash, beginning of period | 4,162,548 | 1,971,923 |
Cash, end of period | 1,662,098 | 838,162 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW STATEMENTS | ||
Cash paid for interest | 43,130 | 152,479 |
Cash paid for income taxes | $ 251 | 1,600 |
SUPPLEMENTAL DISCLOSURES OF NON CASH INVESTING AND FINANCING ACTIVITIES | ||
Shares issued for asset purchase | 2,671,233 | |
Beneficial conversion feature of convertible debt | 750,000 | |
Shares issued for investment in unconsolidated entity | 194,803 | |
Shares issued for license content assets | 2,065,878 | |
Common stock issued for equity investment in unconsolidated entity | $ 863,434 |
BUSINESS
BUSINESS | 3 Months Ended |
Dec. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BUSINESS | NOTE 1 – BUSINESS Loop Media Inc. (the “Company”; formerly Interlink Plus, Inc.) is a Nevada corporation. We were incorporated under the laws of the State of Nevada on May 11, 2015. We are a multichannel digital video platform media company that uses marketing technology, or “MarTech,” to generate our revenue and fuel our services. Our technology and vast library of videos and licensed content enable us to curate and deliver short-form videos to our out-of-home (“OOH”) dining, hospitality, retail and other customers to enable them to inform, entertain and engage their customers. Our technology provides OOH customers and third-party advertisers with a targeted marketing and promotional tool for their products and services and allows us to measure the number of potential viewers of such advertising and promotional materials. In addition to providing services to OOH venue operators, we provide our services direct to consumers (“D2C”) in their homes and on their mobile devices. We offer self-curated music video content licensed from major and independent record labels, as well as movie, television and video game trailers, kid-friendly videos, viral videos, drone footage, news headlines, and lifestyle and atmospheric channels. We believe we are the only service in the United States that has OOH and D2C licenses with all three major music labels. These licenses allow us to provide music video content in both the OOH and D2C markets. Our OOH services are complimented by our mobile app (the “Loop App”), which allows users to follow each other, share their locations and playlists, view activity, and signal support for a music video. We curate content into playlists for OOH locations and into streaming channels for delivery to our over-the-top (“OTT”) platform customers and our mobile application users. Our digital platform service seeks to surround and engage consumers with a diverse offering of video content on their chosen digital screen wherever they are located. Our services include both an ad-supported service, which offers content on a free or unpaid advertising supported basis, and a subscription service, which offers content on a paid subscription basis. We deliver our services to OOH locations primarily through our proprietary Loop Media-designed “small-box” streaming Android media player (the “Loop Player”) and direct to consumers through our fully functional and operational Loop App and across OTT streaming platforms on connected TVs. Going concern and management’s plans As of December 31, 2021, we had cash of $1,662,098 and an accumulated deficit of ($71,116,411). During the three months ended December 31, 2021, we used net cash in operating activities of $(3,477,763). We have incurred net losses since inception. These conditions raise substantial doubt about our ability to continue as a going concern within one year from the issuance date of these consolidated financial statements. Our primary source of operating funds since inception has been cash proceeds from debt and equity financing transactions. Our ability to continue as a going concern is dependent upon our ability to generate sufficient revenue and our ability to raise additional funds by way of our debt and equity financing efforts. The accompanying unaudited consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. These unaudited consolidated financial statements do not include any adjustments relating to the recovery of the recorded assets or classification of the liabilities that might be necessary if we are unable to continue as a going concern. Our ability to continue as a going concern is dependent on management’s further implementation of our on-going and strategic plans, which include continuing to raise funds through equity and/or debt raises. If we are unable to raise adequate funds, certain aspects of the on-going and strategic plans may require modification. Management is in the process of identifying sources of capital via strategic partnerships, debt refinancing and equity investments through one or more private placements. COVID-19 The continuing spread of COVID-19 around the world is affecting the United States and global economies and has affected our operations and those of third parties on which we rely, including disruptions in staffing, order fulfillment and demand for the product. In addition, the COVID-19 pandemic has in the past and may affect our revenue significantly in the future. Additionally, while the potential economic impact brought by, and the duration of the COVID-19 pandemic is difficult to assess or predict, the impact of the COVID-19 pandemic on the global financial markets may reduce our ability to access capital, which could negatively impact our short-term and long-term liquidity. The continuing impact of the COVID-19 pandemic is highly uncertain and subject to change. As COVID-19 continues to evolve, the extent to which the coronavirus impacts operations will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the duration and severity of the outbreak, and the actions that may be required to contain the coronavirus or treat its impact. We continue to monitor the pandemic and, the extent to which the continued spread of the virus adversely affects our customer base and therefore revenue. As the COVID-19 pandemic is complex and rapidly evolving, our plans as described above may change. At this point, we cannot reasonably estimate the duration and severity of this pandemic, which could have a material adverse impact on the business, results of operations, financial position, and cash flows. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Interim Financial Statements The following (a) condensed consolidated balance sheet as of September 30, 2021, which has been derived from our audited financial statements, and (b) our unaudited condensed consolidated interim financial statements for the three months ended December 31, 2021, have been prepared in accordance with accounting principles generally accepted in the United States ("US GAAP") for interim financial information and the instructions to Form 10-Q and Rule 8-03 of Regulation S-X of the Securities Act of 1933. Accordingly, they do not include all of the information and footnotes required by US GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended December 31, 2021, are not necessarily indicative of results that may be expected for the year ending September 30, 2022. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended September 30, 2021, included in our Annual Report on Form 10-KT filed with the Securities and Exchange Commission ("SEC") on January 21, 2022. Basis of presentation The unaudited Use of estimates The preparation of the unaudited condensed consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include assumptions used in the fair value of stock-based compensation, the fair value of other equity and debt instruments, fair value of intangible assets and recoverability of license content assets. Business combinations We account for business acquisitions under Accounting Standards Codification (“ASC”) 805, Business Combinations. instruments issued and liabilities assumed on the acquisition date. Costs that are directly attributable to the acquisition are expenses as incurred. Identifiable assets (including intangible assets), liabilities assumed (including contingent liabilities) and noncontrolling interests in an acquisition are measured initially at their fair values on the acquisition date. We recognize goodwill if the fair value of the total purchase consideration and any noncontrolling interest is in excess of the net fair value of the identifiable assets and the liabilities assumed. The results of operations of the acquired business are included in the consolidated financial statements beginning on the acquisition date. Variable interest entities (“VIE”) Variable interests are contractual, ownership or other monetary interests in an entity that change with fluctuations in the fair value of the entity’s net assets exclusive of variable interests. A VIE can arise from items such as lease agreements, loan arrangements, guarantees or service contracts. An entity is a VIE if (a) the entity lacks sufficient equity or (b) the entity’s equity holders lack power or the obligation and right as equity holders to absorb the entity’s expected losses or to receive its expected residual returns. If an entity is determined to be a VIE, the entity must be consolidated by the primary beneficiary. The primary beneficiary is the holder of the variable interests that has the power to direct the activities of a VIE that most significantly impact the VIE’s economic performance and has the obligation to absorb losses of or the right to receive benefits from the VIE that could potentially be significant to the VIE. Therefore, we must identify which activities most significantly impact the VIE’s economic performance and determine whether it, or another party, has the power to direct those activities. As of December 31, 2021, and September 30, 2021, we had no investments that qualify as VIE. Segment reporting We report as one reportable segment because we do not have more than one operating segment. Our business activities, revenues and expenses are evaluated by management as one reportable segment. Cash Cash and cash equivalents include all highly liquid monetary instruments with original maturities of three months or less when purchased. These investments are carried at cost, which approximates fair value. Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash deposits. We maintain our cash in institutions insured by the Federal Deposit Insurance Corporation (“FDIC”). At times, our cash and cash equivalent balances may be uninsured or in amounts that exceed the FDIC insurance limits. We have not experienced any loses on such accounts. On December 31, 2021, and September 30, 2021, we had no cash equivalents. As of December 31, 2021, and September 30, 2021, approximately $1,162,098 and $3,655,716 of cash exceeded the FDIC insurance limits, respectively. Accounts receivable Accounts receivable represent amounts due from customers. We assess the collectability of receivables on an ongoing basis. A provision for the impairment of receivables involves significant management judgment and includes the review of individual receivables based on individual customers, current economic trends and analysis of historical bad debts. As of December 31, 2021, and September 30, 2021, we recorded an allowance for doubtful accounts of $446,812 and $216,238, respectively. Concentration of credit risk We grant credit in the normal course of business to our customers. Periodically, we review past due accounts and makes decisions about future credit on a customer by customer basis. Credit risk is the risk that one party to a financial instrument will cause a loss for the other party by failing to discharge an obligation. Our concentration of credit risk was not significant as of December 31, 2021, and September 30, 2021. License Content Asset On January 1, 2020, we adopted the guidance in ASU 2019-02, Entertainment—Films—Other Assets—Film Costs (Subtopic 926-20) and Entertainment—Broadcasters—Intangibles—Goodwill and Other (Subtopic 920-350): Improvements to Accounting for Costs of Films and License Agreements for Program Materials Goodwill and other intangible assets Goodwill represents the excess of the purchase consideration over the fair value of the net tangible and identifiable intangible assets acquired in a business combination. Goodwill and other intangible assets determined to have an indefinite useful life are not amortized but are subject to impairment tests. We conduct our annual impairment tests or whenever events and changes in circumstances suggest that the carrying amount may not be recoverable. We conducted the annual impairment test on September 30, 2021. When evaluating goodwill and indefinite-lived intangible assets for impairment, we may first perform an assessment of qualitative factors to determine if the fair value of the reporting unit or the intangible asset is more-likely-than-not greater than the carrying amount. Significant factors considered in this assessment include, but are not limited to, macro-economic conditions, market and industry conditions, cost considerations, the competitive environment, overall financial performance, and results of past impairment tests. If, based on a review of the qualitative factors, we determine it is more-likely-than-not that the fair value is greater than the carrying value, we may bypass a quantitative test for impairment. In performing the quantitative test for impairment of goodwill, we compare the fair value of each reporting unit with it carrying amount, including goodwill, in order to identify a potential impairment. Measurement of the fair value of a reporting unit is based on a fair value measure using the sum of the discounted estimated future cash flows. Estimates of forecasted cash flows involve measurement uncertainty, and it is therefore possible that reductions in the carrying value of goodwill may be required in the future because of changes in management’s future cash flow estimates. When the fair value of a reporting unit is less than it carrying amount, goodwill of the reporting unit is considered to be impaired. Effective January 1, 2020, we adopted the guidance in Accounting Standards Update (“ASU”) 2017-04, Simplifying the Test for Goodwill Impairment , which measures impairment amount as the excess of a reporting unit’s carrying amount over its fair value as determined by the quantitative test. Operating leases We determine if an arrangement is a lease at inception. Operating lease right-of-use assets (“ROU assets”) and short-term and long-term lease liabilities are included on the face of the consolidated balance sheet. ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, we use an incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Our 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 with lease and non-lease components, which are accounted for as a single lease component. For lease agreements with terms less than 12 months, we have elected the short-term lease measurement and recognition exemption, and recognize such lease payments on a straight-line basis over the lease term. Fair value measurement We determine the fair value of our assets and liabilities using a hierarchy established by the accounting guidance that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). The three levels of valuation hierarchy are defined as follows: ● Level 1 inputs to the valuation methodology are quoted prices for identical assets or liabilities in active markets. ● Level 2 inputs to the valuation methodology included quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets in inactive markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. ● Level 3 inputs to the valuation methodology is one or more unobservable inputs which are significant to the fair value measurement. The carrying amount of our financial instruments, including cash, accounts receivable, deposits, short-term portion of notes receivable and notes payable, and current liabilities approximate fair value due to their short-term nature. We do not have financial assets or liabilities that are required under US GAAP to be measured at fair value on a recurring basis. We have not elected to use fair value measurement option for any assets or liabilities for which fair value measurement is not presently required. We record assets and liabilities at fair value on nonrecurring basis as required by US GAAP. Assets recognized or disclosed at fair value in the condensed The following table summarizes changes in fair value measurements of the Derivative Liability during the three months ended December 31, 2021: Quoted Prices in Significant Active Markets Significant Other Unobservable For Identical Items Observable Inputs Inputs (Level 1) (Level 2) (Level 3) Total Derivative liabilities — — 959,888 959,888 Total $ — $ — $ 959,888 $ 959,888 The following table summarizes changes in fair value measurements of the Derivative Liability during the three months ended September 30, 2021: Quoted Prices in Significant Active Markets Significant Other Unobservable For Identical Items Observable Inputs Inputs (Level 1) (Level 2) (Level 3) Total Derivative liabilities — — 1,058,633 1,058,633 Total $ — $ — $ 1,058,633 $ 1,058,633 The following table summarizes changes in fair value measurements of the Derivative Liability during the three months ended December 31, 2021: Balance as of September 30, 2021 $ 1,058,633 Change in fair value (98,745) Balance as of December 31, 2021 $ 959,888 The following table summarizes the unobservable inputs used in the valuation of the derivatives during the three months ended December 31, 2021: Expected term 0.92 - 2 years Discount rate 7.12% - 11.09% Volatility 75% - 110.0% Convertible debt and derivative treatment When we issue debt with a conversion feature, we must first assess whether the conversion feature meets the requirements to be treated as a derivative, as follows: a) one or more underlyings, typically the price of our common stock; b) one or more notional amounts or payment provisions or both, generally the number of shares upon conversion; c) no initial net investment, which typically excludes the amount borrowed; and d) net settlement provisions, which in the case of convertible debt generally means the stock received upon conversion can be readily sold for cash. An embedded equity-linked component that meets the definition of a derivative does not have to be separated from the host instrument if the component qualifies for the scope exception for certain contracts involving an issuer’s own equity. The scope exception applies if the contract is both a) indexed to its own stock, and b) classified in shareholders’ equity in its statement of financial position. If the conversion feature within convertible debt meets the requirements to be treated as a derivative, we estimate the fair value of the convertible debt derivative using the Monte Carlo Method upon the date of issuance. If the fair value of the convertible debt derivative is higher than the face value of the convertible debt, the excess is immediately recognized as interest expense. Otherwise, the fair value of the convertible debt derivative is recorded as a liability with an offsetting amount recorded as a debt discount, which offsets the carrying amount of the debt. The convertible debt derivative is revalued at the end of each reporting period and any change in fair value is recorded as a gain or loss in the statement of operations. The debt discount is amortized through interest expense over the life of the debt. Convertible debt and beneficial conversion features If the conversion feature is not treated as a derivative, we assess whether it is a beneficial conversion feature (“BCF”). A BCF exists if the conversion price of the convertible debt instrument is less than the stock price on the commitment date. This typically occurs when the conversion price is less than the fair value of the stock on the date the instrument was issued. The value of a BCF is equal to the intrinsic value of the feature, the difference between the conversion price and the common stock into which it is convertible and is recorded as additional paid in capital and as a debt discount in the consolidated balance sheets. We amortize the balance over the life of the underlying debt as amortization of debt discount expense in the consolidated statements of operations. If the debt is retired early, the associated debt discount is then recognized immediately as amortization of debt discount expense in the consolidated statements of operations. If the conversion feature does not qualify for either the derivative treatment or as a BCF, the convertible debt is treated as traditional debt. Advertising costs We expense all advertising costs as incurred. Advertising and marketing costs for the three months ended December 31, 2021, and 2020 were $1,198,000 and $780,000, respectively. Revenue recognition We recognize revenue in accordance with ASC 606 , Revenue from Contracts with Customers ● executed contracts with our customers that it believes are legally enforceable; ● identification of performance obligations in the respective contract; ● determination of the transaction price for each performance obligation in the respective contract; ● allocation of the transaction price to each performance obligation; and ● recognition of revenue only when we satisfy each performance obligation. Performance obligations and significant judgments Our revenue streams can be categorized into the following performance obligations and recognition patterns: o Delivery of streaming services including content encoding and hosting. We recognize revenue over the term of the service based on bandwidth usage. o Delivery of subscription content services in customized formats. We recognize revenue over the term of the service. o Delivery of hardware for ongoing subscription content delivery through software. We recognize revenue at the point of hardware delivery. o Revenue share arrangements, where platform providers distribute our licensed content and providers pay us a portion of the usage-based advertising revenues. Transaction prices for performance obligations are explicitly outlined in relevant agreements; therefore, we do not believe that significant judgments are required with respect to the determination of the transaction price, including any variable consideration identified. Customer acquisition costs We record commission expense associated with subscription revenue. Commissions are included in operating expenses. We have elected the practical expedient that allows us to recognize the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that we otherwise would have recognized is one year or less. Cost of revenue Cost of revenue represents the cost of the delivered hardware and related bundled software and is recognized at the time of sale. For ongoing licensing and hosting fees, cost of sales is recognized over time based on usage patterns. Deferred income We bill subscription services in advance of when the service period is performed. The deferred income recorded at December 31, 2021, and September 30, 2021, represents our accounting for the timing difference between when the subscription fees are received and when the performance obligation is satisfied. Net loss per share We account for net loss per share in accordance with ASC subtopic 260-10, Earnings Per Share Basic net loss per share is computed by dividing net loss attributable to common stockholders by the weighted average number of shares of common stock outstanding during each period. It excludes the dilutive effects of any potentially issuable common shares. Diluted net loss per share is calculated by including any potentially dilutive share issuances in the denominator. The following securities are excluded from the calculation of weighted average diluted shares at December 31, 2021, and December 31, 2020, respectively, because their inclusion would have been anti-dilutive. December 31, December 31, 2021 2020 Options to purchase common stock 18,638,806 8,312,306 Warrants to purchase common stock 15,464,700 8,585,558 Series A preferred stock — 3,066,700 Series B preferred stock 20,000,000 20,000,000 Convertible debentures 5,393,685 7,079,622 Total common stock equivalents 59,497,191 47,044,186 Stock-based compensation Share-based compensation issued to employees is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the requisite service period. We measure the fair value of the share-based compensation issued to non-employees using the stock price observed in the trading market (for stock transactions) or the fair value of the award (for non-stock transactions), which were more reliably determinable measures of fair value than the value of the services being rendered. The measurement date is the earlier of (1) the date at which commitment for performance by the counterparty to earn the equity instruments is reached, or (2) the date at which the counterparty’s performance is complete. |
INVENTORY
INVENTORY | 3 Months Ended |
Dec. 31, 2021 | |
Inventory Disclosure [Abstract] | |
INVENTORY. | NOTE 3 – INVENTORY Our finished goods inventory consisted of the following on December 31, 2021, and September 30, 2021: December 31, September 30, 2021 2021 Computers $ 6,535 $ 6,881 Hasp keys 3,416 3,581 Loop player 104,772 212,586 Total inventory $ 114,723 $ 223,048 |
LICENSE CONTENT ASSETS
LICENSE CONTENT ASSETS | 3 Months Ended |
Dec. 31, 2021 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
LICENSE CONTENT ASSETS | NOTE 4 – LICENSE CONTENT ASSETS License Content Assets To stream video content to the users, we generally secure intellectual property rights to such content by obtaining licenses from, and paying royalties or other consideration to, rights holders or their agents. The licensing arrangements can be for a fixed fee, variable fee, or combination of both. The licensing arrangements specify the period when the content is available for streaming. The license content assets are two years in duration and include prepayments to distributors for customer subscription revenues, per play usage fees, and ad supported fees. As of December 31, 2021, license content assets were $539,208 recorded as License content asset, net – current and $365,360 recorded as License content asset, net – noncurrent. On December 30, 2020, we issued common shares capitalized as License content asset and we subsequently deemed the equity portion of the consideration paid was not recoverable and not recoupable and therefore impaired the License content asset for the value of the capitalized shares for $2,260,799 on December 31, 2020. We recorded amortization expense of $311,055 and $170,682 for the three months ended December 31, 2021, and 2020, respectively, in cost of revenue, in the consolidated statements of operations, related to capitalized license content assets. The amortization expense for the next two years for capitalized license content assets as of December 31, is $746,722 in 2022, and $157,846 in 2023. License Content Liabilities On December 31, 2021, we had $404,000 of obligations comprised of $404,000 in License content liability – current and $0 in License content liability – noncurrent on the Consolidated Balance Sheets. Payments for content liabilities for the three months ended December 31, 2021, were $581,000. The expected timing of payments for these content obligations is $404,000 payable in fiscal year 2022. Certain contracts provide for recoupment of payments on minimum obligations during the term of the contracts. |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 3 Months Ended |
Dec. 31, 2021 | |
Disclosure Text Block [Abstract] | |
GOODWILL AND OTHER INTANGIBLE ASSETS | NOTE 5. GOODWILL AND OTHER INTANGIBLE ASSETS As of December 31, 2021, and September 30, 2021, the balance of goodwill was $1,970,321 and $1,970,321, respectively. Our other intangible assets, each definite lived assets, consisted of the following as of December 31, 2021, and September 30, 2021: December 31, September 30, Useful life 2021 2021 Customer relationships nine years $ 1,012,000 $ 1,012,000 Content library two years 198,000 198,000 Total intangible assets, gross 1,210,000 1,210,000 Less: accumulated amortization (535,333) (507,222) Total (535,333) (507,222) Total intangible assets, net $ 674,667 $ 702,778 Amortization expense charged to operations amounted to $32,403 and $335,078, respectively, for the three months ended December 31, 2021, and the three months ended December 31, 2020. Annual amortization expense for the next five years and thereafter is estimated to be $80,041 (remaining in 2022), $112,444, $112,444, $112,444, $112,444, and $112,444, respectively. The weighted average life of the intangible assets subject to amortization is 6 years on December 31, 2021. |
LEASES
LEASES | 3 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
LEASES | NOTE 6 – LEASES Operating leases We have operating leases for office space and office equipment. Many leases include one or more options to renew, some of which include options to extend the leases for a long-term period, and some leases include options to terminate the leases within 30 days. In certain of our lease agreements, the rental payments are adjusted periodically to reflect actual charges incurred for capital area maintenance, utilities, inflation and/or changes in other indexes. December 31, September 30, 2021 2021 Short term portion $ 170,533 $ 167,101 Long term portion 32,749 75,530 Total lease liability $ 203,282 $ 242,631 Maturity analysis under these lease agreements are as follows: 2022 $ 185,834 2023 37,584 Total undiscounted cash flows 223,418 Less: 10% Present value discount (20,136) Lease liability $ 203,282 Three months ended December 31. 2021 2020 Operating lease expense $ 44,444 $ 44,444 Short-term lease expense 2,100 3,033 Total lease expense $ 46,544 $ 47,477 Operating lease expense is included in selling, general and administration expenses in the consolidated statement of operations. For the three months ended December 31, 2021, cash payments against lease liabilities totaled $45,238, accretion on lease liability of $5,889. For the three months ended December 31, 2020, cash payments against lease liabilities totaled $44,086, accretion on lease liability of $9,584. Weighted-average remaining lease term and discount rate for operating leases are as follows: Weighted-average remaining lease term 1.45 years Weighted-average discount rate 10 % |
ACCOUNTS PAYABLE AND ACCRUED EX
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | 3 Months Ended |
Dec. 31, 2021 | |
Payables and Accruals [Abstract] | |
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | NOTE 7 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES Accounts payable and accrued expenses consisted of the following as of December 31, 2021, and September 30, 2021: December 31, September 30, 2021 2021 Accounts payable $ 1,465,271 $ 1,147,585 Interest payable 201,818 106,631 Accrued liabilities 1,600,564 941,440 Payroll liabilities 20,250 20,250 Total accounts payable and accrued expenses $ 3,287,903 $ 2,215,906 |
NOTE PAYABLE
NOTE PAYABLE | 3 Months Ended |
Dec. 31, 2021 | |
Disclosure Text Block [Abstract] | |
NOTE PAYABLE | NOTE 8 – NOTE PAYABLE PPP loan On December 28, 2021, we received a notification from the Small Business Association for the full forgiveness of the PPP loan of $486,638 received on April 26, 2021. The PPP loan forgiven consisted of $486,638 principal and $3,413 accrued interest, which are included in other income for the three months ending December 31, 2021. |
CONVERTIBLE DEBENTURES PAYABLE
CONVERTIBLE DEBENTURES PAYABLE | 3 Months Ended |
Dec. 31, 2021 | |
Debt Instruments [Abstract] | |
CONVERTIBLE DEBENTURES PAYABLE | NOTE 9 – CONVERTIBLE DEBENTURES PAYABLE Convertible debentures as of December 31, 2021: Unpaid Contractual Net Carrying Value Principal Interest Rates Contractual Warrants Related party convertible debentures: Current Long Term Balance Cash PIK Maturity Date issued $3,000,000 convertible debenture amended October 23, 2020 (1) $ 558,689 $ 726,839 $ 2,442,896 10% 12/1/2023 3,550,709 $750,000 convertible debenture, December 1, 2020 (2) 582,256 — 750,000 4% 6% 12/1/2022 68,182 $800,000 convertible debenture, April 1, 2021 (2) 591,090 — 800,000 4% 6% 12/1/2022 72,727 $400,000 convertible debenture, May 1, 2021 (2) 289,407 — 400,000 4% 6% 12/1/2022 36,364 $400,000 convertible debenture, June 2, 2021 (2) 283,769 — 400,000 4% 6% 12/1/2022 36,364 Total related party convertible debentures, net $ 2,305,211 $ 726,839 $ 4,792,896 Convertible debentures: $350,000 convertible debenture, January 12, 2021 (2) 266,384 — 350,000 4% 6% 12/1/2022 87,500 $250,000 convertible debenture, May 21, 2021 (2) 179,867 — 250,000 4% 6% 12/1/2022 22,727 Total convertible debentures, net $ 446,251 $ — $ 600,000 Convertible debentures as of September 30, 2021: Unpaid Contractual Net Carrying Value Principal Interest Rates Contractual Warrants Related party convertible debentures: Current Long Term Balance Cash PIK Maturity Date issued $3,000,000 convertible debenture amended October 23, 2020 (1) $ 530,226 $ 876,256 $ 2,715,582 10% 12/1/2023 3,550,709 $750,000 convertible debenture, December 1, 2020 (2) — 536,508 750,000 4% 6% 12/1/2022 68,182 $800,000 convertible debenture, April 1, 2021 (2) — 534,114 800,000 4% 6% 12/1/2022 72,727 $400,000 convertible debenture, May 1, 2021 (2) — 259,246 400,000 4% 6% 12/1/2022 36,364 $400,000 convertible debenture, June 2, 2021 (2) — 252,070 400,000 4% 6% 12/1/2022 36,364 Total related party convertible debentures, net $ 530,226 $ 2,458,194 $ 5,065,582 Convertible debentures: $350,000 convertible debenture, January 12, 2021 (3) — 243,579 350,000 4% 6% 12/1/2022 87,500 $250,000 convertible debenture, May 21, 2021 (4) — 160,741 250,000 4% 6% 12/1/2022 22,727 Total convertible debentures, net $ — $ 404,320 $ 600,000 1) Unsecured convertible debentures (at $0.60 per common share) issued to related parties, amended October 23, 2020, interest at 10% per annum beginning November 1, 2020, monthly payments of unpaid interest accrued at 12.5% per annum will be paid in arrears through March 31, 2021, beginning April 1, 2021, we began paying equal monthly installments of principal and interest at 10% per annum through December 1, 2023. The debentures are convertible at any time prior to the maturity in whole or in parts into our common shares at a price of $0.60 per common share. We issued 3,550,709 common share purchase warrants, with each warrant exercisable at $0.86 for a period of 10 years. The beneficial conversion feature totaled $612,313 and was recorded as a debt discount. We also recorded the allocated fair value of the warrants $2,387,687 as additional debt discount. (2) On December 1, 2020, we offered, in a private placement, the aggregate offering amount of up to $3,000,000 of Senior Secured Promissory Debentures, with a minimum subscription amount of $250,000 and common stock warrants with an aggregate exercise price of $750,000 and aggregate exercisable warrant shares of 272,727 shares. We treated the conversion feature as a derivative instrument. At the option of the Senior Secured Promissory Note holders, the notes are convertible at the earlier of a change of control event, a Qualified IPO, both of which are defined in the Promissory Note Agreement or the maturity date of December 1, 2022. If the conversion takes place at the maturity date, the note will be converted in whole or in parts (which cannot be less than 50% of the amount due under the note) into an amount of shares equal to the amount due divided by the average of the VWAP of common stock during each trading day during the thirty trading day period ending one trading day prior to the maturity date. If the conversion takes place at the change of control date, the note will be converted into an amount of shares equal to the amount due divided by the average of the VWAP of common stock during each trading day during the ten trading day period ending one trading day prior to the change of control effective date. In the event of a Qualified IPO, but subject to the closing of such Qualified IPO, the amount due shall convert in full on the closing date of such Qualified IPO into a number of shares equal to the amount due on such closing date divided by the applicable IPO conversion price, as defined in the Promissory Note Agreement. The Senior Secured Promissory Debentures under the offering accrue cash interest at 4% per annum and payment in kind (PIK) interest at 6% payable in our common stock, determined on a 360-day basis. Cash interest is payable in advance for the period from the issue date to November 30, 2021, and then is payable six months in arrears on June 1, 2022, then six months in arrears on December 1, 2022. The accrued PIK interest is payable in shares of common stock in an amount equal to the amount of PIK Interest accrued as of such date, divided by the volume weighted average price (VWAP) of common stock during each trading day during the ten-trading day period ending one trading day prior to the PIK Interest Payment due dates of June 1, 2021, December 1, 2021, June 1, 2022, and December 1, 2022. The proceeds received upon issuing the Senior Secured Promissory Debentures were first allocated to the fair value of the embedded features with the remainder to the debt host instrument. ● $750,000 December 1, 2020 debenture the fair value of the conversion feature of $339,216 and the allocated fair value of the warrants of $26,770 were recorded as debenture discount. ● $350,000 January 12, 2021 debenture the fair value of the conversion feature of $139,751 and the allocated fair value of the warrants of $31,282 were recorded as debenture discount. ● $800,000 April 1, 2021 debenture the fair value of the conversion feature of $319,431 and the allocated fair value of the warrants of $60,406 were recorded as debenture discount. ● $400,000 May 1, 2021 debenture the fair value of the conversion feature of $159,715 and the allocated fair value of the warrants of $31,309 were recorded as debenture discount. ● $250,000 May 21, 2021 debenture the fair value of the conversion feature of $99,822 and the allocated fair value of the warrants of $14,940 were recorded as debenture discount. ● $400,000 June 2, 2020 debenture the fair value of the conversion feature of $159,715 and the allocated fair value of the warrants of $30,481 were recorded as debenture discount. The following table presents the interest expense related to the contractual interest coupon and the amortization of debt discounts on the convertible debentures: Three months ended December 31, 2021 2020 Interest expense $ 145,869 $ 212,372 Amortization of debt discounts 358,248 183,533 Total $ 504,117 $ 395,905 For the nine months remaining 2022 $ 859,518 2023 4,200,761 2024 332,616 Convertible debentures payable, related and non related party 5,392,895 Less: Debt discount on convertible debentures payable (1,914,595) Total convertible debentures payable, related and non related party, net $ 3,478,300 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 10 – COMMITMENTS AND CONTINGENCIES We may be involved in legal proceedings, claims and assessments arising in the ordinary course of business. Such matters are subject to many uncertainties, and outcomes are not predictable with assurance. There are no such loss contingencies that are included in the financial statements as of December 31, 2021. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Dec. 31, 2021 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 11 – RELATED PARTY TRANSACTIONS Related parties are natural persons or other entities that have the ability, directly or indirectly, to control another party or exercise significant influence over the party making financial and operating decisions. Related parties include other parties that are subject to common control or that are subject to common significant influences. We borrowed funds for business operations from a certain stockholder and board member through convertible debenture agreements and have remaining balances, including accrued interest amounting to $3,130,834 and $2,448,871 as of December 31, 2021, and September 30, 2021, respectively. We incurred interest expense, including amortization of debt discount for these convertible debentures in the amounts of $223,818 and $21,708 for the three months ended December 31, 2021, and 2020, respectively. See Note 9 for convertible debentures discussion. |
STOCKHOLDERS' EQUITY (DEFICIT)
STOCKHOLDERS' EQUITY (DEFICIT) | 3 Months Ended |
Dec. 31, 2021 | |
Equity [Abstract] | |
STOCKHOLDERS' EQUITY (DEFICIT) | NOTE 12 –STOCKHOLDERS’ EQUITY (DEFICIT) Convertible Preferred Stock Of the 16,666,667 shares of preferred stock authorized, we had designated (i) 3,333,334 shares of preferred stock as Series A Convertible Preferred Stock (the “Series A Preferred Stock”) and (ii) 3,333,334 shares of preferred stock as Series B Convertible Preferred Stock (the “Series B Preferred Stock.” As of December 31, 2021, and December 31, 2020, we had 0 and 30,667 shares of Series A Preferred Stock issued and outstanding, respectively. As of December 31, 2021, and December 31, 2020, we had 200,000 and 200,000 shares of Series B Preferred Stock issued and outstanding, respectively. Each share of Series B Preferred Stock has a liquidation preference of $1.50 per share, is entitled to 100 votes per share and is convertible at any time at the discretion of the holder thereof into 100 shares of common stock. We evaluated the features of the Convertible Preferred Stock under ASC 480 and classified them as permanent equity because the Convertible Preferred stock is not mandatorily or contingently redeemable at the stockholder’s option and the liquidation preference that exists does not fall within the guidance of SEC Accounting Series Release No. 268 – Presentation in Financial Statements of “Redeemable Preferred Stocks” Common stock Our authorized capital stock consists of 316,666,667 shares of common stock, $0.0001 par value per share, and 16,666,667 shares of preferred stock, $0.0001 par value per share. As of December 31, 2021, and December 31, 2020, there were 133,470,020 and 116,800,982, respectively, shares of common stock issued outstanding Three months ended December 31, 2021 Three months ended December 31, 2020 During the three months ended December 31, 2020, we issued an aggregate of 704,000 shares of common stock for proceeds of $880,000. During the three months ended December 31, 2020, we received $350,000 for common stock payable. During the three months ended December 31, 2020, we issued 1,369,863 shares of our common stock with a value of $2,671,096 for the purchase certain intangible assets. During the three months ended December 31, 2020, we issued 97,891 shares of our common stock with a value of $194,803 as a debt settlement. During the three months ended December 31, 2020, we issued warrants valued at $492,000. During the three months ended December 31, 2020, we issued 1,180,880 shares of our common stock, valued at $2,065,878 capitalized as license content assets. During the three months ended December 31, 2020, we issued 454,463 shares of our common stock with a value of $863,480 for the purchase of 20% ownership in EON. |
STOCK OPTIONS AND WARRANTS
STOCK OPTIONS AND WARRANTS | 3 Months Ended |
Dec. 31, 2021 | |
Share-based Payment Arrangement, Additional Disclosure [Abstract] | |
STOCK OPTIONS AND WARRANTS | NOTE 13 – STOCK OPTIONS AND WARRANTS Options Option valuation models require the input of highly subjective assumptions. The fair value of stock-based payment awards was estimated using the Black-Scholes option model with a volatility figure derived from using our historical stock prices. We account for the expected life of options based on the contractual life of options for non-employees. For employees, our accounts for the expected life of options in accordance with the “simplified” method, which is used for “plain-vanilla” options, as defined in the accounting standards codification. The risk-free interest rate was determined from the implied yields of U.S. Treasury zero-coupon bonds with a remaining life consistent with the expected term of the options. The following table summarizes the stock option activity for the three months ended December 31, 2021: Weighted Weighted Average Average Remaining Aggregate Options Exercise Price Contractual Term Intrinsic Value Outstanding at September 30, 2021 17,833,356 $ 1.04 8.30 $ 25,478,339 Grants 911,200 2.30 9.77 — Exercised — — — — Expired — — — — Forfeited (105,750) 1.10 — (3,454,110) Outstanding at December 31, 2021 18,638,806 $ 1.10 8.13 $ 22,024,229 Exercisable at December 31, 2021 12,175,833 $ 0.95 7.68 $ 16,073,164 The aggregate intrinsic value in the preceding tables represents the total pretax intrinsic value, based on options with an exercise price less than our stock price of $2.25 as of December 31, 2021, and $3.21 as of December 31, 2020, which would have been received by the option holders had those option holders exercised their options as of that date. The following table presents information related to stock options on December 31, 2021: Options outstanding Weighted Options average exercisable Exercise Number of remaining life number of price options in years options 0.86 1,148,371 4.66 1,148,371 0.66 4,663,935 6.84 4,663,935 0.89 2,500,000 8.46 1,714,000 1.10 7,915,299 8.87 3,669,990 0.57 300,000 9.17 300,000 2.84 450,000 9.33 250,000 2.75 600,000 9.34 116,667 2.35 125,000 9.72 6,944 2.40 50,000 9.57 — 2.50 50,000 9.59 50,000 2.30 836,200 9.77 255,925 18,638,806 12,175,833 Stock-based compensation We recognize compensation expense for all stock options granted using the fair value-based method of accounting. During the three months ended December 31, 2021, we issued 911,200 options valued at $1.38 per option. As of December 31, 2021, the total compensation cost related to nonvested awards not yet recognized is $11,096,347 and the weighted average period over which expense is expected to be recognized in months is 27.41. We calculated the fair value of options issued using the Black-Scholes option pricing model, with the following assumptions: December 31, 2021 Weighted average fair value of options granted $ 2.03 Expected life 5.00 – 6.00 years Risk-free interest rate 0.01 - 1.47 % Expected volatility 55.80 - 69.60 % Expected dividends yield 0 % Forfeiture rate 0 % The stock-based compensation expense related to option grants was $1,549,406 and $316,033, for the three months ended December 31, 2021, and 2020, respectively. Warrants The following table summarizes the changes in warrants outstanding and the related prices for the shares of our common stock: Warrants outstanding Warrants exercisable Weighted Weighted average average remaining Weighted remaining contractual average contractual Number life exercise Number life Exercise prices outstanding (years) price exercisable (years) $ 0.86 3,850,709 5.37 $ 0.86 3,850,709 5.37 0.38 2,000,000 4.93 0.38 2,000,000 4.93 0.75 2,666,667 8.20 0.75 2,666,667 8.20 2.75 323,864 0.92 2.75 323,864 0.92 2.80 50,000 9.32 2.80 50,000 9.32 2.75 6,573,460 2.75 2.75 6,573,460 2.75 The following table summarizes the warrant activity for the nine months ended December 31, 2021: Weighted average exercise Number of price per shares share Outstanding at September 30, 2021 15,464,700 $ 1.63 Issued — — Exercised — — Expired — — Outstanding at December 31, 2021 15,464,700 $ 1.63 We record all warrants granted using the fair value-based method of accounting. During the three months ended December 31, 2021, we issued no warrants. During the three months ended December 31, 2020, we issued 68,182 warrants in conjunction with the issue of related party senior secured convertible debentures in the total amount of $750,000 and recorded the allocated fair values of the warrants of $26,770 as additional debt discounts. We also issued 300,000 warrants to a company for consulting services and recorded consulting expense of $492,000. We calculated the fair value of warrants issued using the Black-Scholes option pricing model, with the following assumptions: December 31, 2021 Weighted average fair value of warrants granted $ 1.15 Expected life 1.75 - 10 years Risk-free interest rate 0.15% to 1.58% Expected volatility 57.30% to 58.65% Expected dividends yield 0 % Forfeiture rate 0 % |
INCOME TAX
INCOME TAX | 3 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
INCOME TAX | NOTE 14 – INCOME TAXES For the three months ended December 31, 2021, we recorded an income tax provision of $251 related to state and local taxes. For the three months ended December 31, 2020, we recorded an income tax provision of $98,244 related to a true-up of prepaid taxes from 2019. The effective rate for both the three months ended December 31, 2021, and December 31, 2020, differ from the U.S. federal statutory rate of 21% as no income tax benefit was recorded for current year operating losses as we maintain a full valuation allowance on our deferred tax assets. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Dec. 31, 2021 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 15 – SUBSEQUENT EVENTS We have evaluated all subsequent events through the date of filing, February 14, 2022, of this Report on Form 10-Q with the SEC, to ensure that this filing includes appropriate disclosure of events both recognized in the financial statements as of December 31, 2021, and events which occurred after December 31, 2021, but which were not recognized in the financial statements. We have determined that there were no subsequent events which required recognition, adjustment to or disclosure in the financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation The unaudited |
Use of estimates | Use of estimates The preparation of the unaudited condensed consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include assumptions used in the fair value of stock-based compensation, the fair value of other equity and debt instruments, fair value of intangible assets and recoverability of license content assets. |
Business combinations | Business combinations We account for business acquisitions under Accounting Standards Codification (“ASC”) 805, Business Combinations. instruments issued and liabilities assumed on the acquisition date. Costs that are directly attributable to the acquisition are expenses as incurred. Identifiable assets (including intangible assets), liabilities assumed (including contingent liabilities) and noncontrolling interests in an acquisition are measured initially at their fair values on the acquisition date. We recognize goodwill if the fair value of the total purchase consideration and any noncontrolling interest is in excess of the net fair value of the identifiable assets and the liabilities assumed. The results of operations of the acquired business are included in the consolidated financial statements beginning on the acquisition date. |
Variable interest entities (""VIE'") | Variable interest entities (“VIE”) Variable interests are contractual, ownership or other monetary interests in an entity that change with fluctuations in the fair value of the entity’s net assets exclusive of variable interests. A VIE can arise from items such as lease agreements, loan arrangements, guarantees or service contracts. An entity is a VIE if (a) the entity lacks sufficient equity or (b) the entity’s equity holders lack power or the obligation and right as equity holders to absorb the entity’s expected losses or to receive its expected residual returns. If an entity is determined to be a VIE, the entity must be consolidated by the primary beneficiary. The primary beneficiary is the holder of the variable interests that has the power to direct the activities of a VIE that most significantly impact the VIE’s economic performance and has the obligation to absorb losses of or the right to receive benefits from the VIE that could potentially be significant to the VIE. Therefore, we must identify which activities most significantly impact the VIE’s economic performance and determine whether it, or another party, has the power to direct those activities. As of December 31, 2021, and September 30, 2021, we had no investments that qualify as VIE. |
Segment reporting | Segment reporting We report as one reportable segment because we do not have more than one operating segment. Our business activities, revenues and expenses are evaluated by management as one reportable segment. |
Cash | Cash Cash and cash equivalents include all highly liquid monetary instruments with original maturities of three months or less when purchased. These investments are carried at cost, which approximates fair value. Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash deposits. We maintain our cash in institutions insured by the Federal Deposit Insurance Corporation (“FDIC”). At times, our cash and cash equivalent balances may be uninsured or in amounts that exceed the FDIC insurance limits. We have not experienced any loses on such accounts. On December 31, 2021, and September 30, 2021, we had no cash equivalents. As of December 31, 2021, and September 30, 2021, approximately $1,162,098 and $3,655,716 of cash exceeded the FDIC insurance limits, respectively. |
Accounts receivable | Accounts receivable Accounts receivable represent amounts due from customers. We assess the collectability of receivables on an ongoing basis. A provision for the impairment of receivables involves significant management judgment and includes the review of individual receivables based on individual customers, current economic trends and analysis of historical bad debts. As of December 31, 2021, and September 30, 2021, we recorded an allowance for doubtful accounts of $446,812 and $216,238, respectively. |
Concentration of credit risk | Concentration of credit risk We grant credit in the normal course of business to our customers. Periodically, we review past due accounts and makes decisions about future credit on a customer by customer basis. Credit risk is the risk that one party to a financial instrument will cause a loss for the other party by failing to discharge an obligation. Our concentration of credit risk was not significant as of December 31, 2021, and September 30, 2021. |
License Content Asset | License Content Asset On January 1, 2020, we adopted the guidance in ASU 2019-02, Entertainment—Films—Other Assets—Film Costs (Subtopic 926-20) and Entertainment—Broadcasters—Intangibles—Goodwill and Other (Subtopic 920-350): Improvements to Accounting for Costs of Films and License Agreements for Program Materials |
Goodwill and other intangible assets | Goodwill and other intangible assets Goodwill represents the excess of the purchase consideration over the fair value of the net tangible and identifiable intangible assets acquired in a business combination. Goodwill and other intangible assets determined to have an indefinite useful life are not amortized but are subject to impairment tests. We conduct our annual impairment tests or whenever events and changes in circumstances suggest that the carrying amount may not be recoverable. We conducted the annual impairment test on September 30, 2021. When evaluating goodwill and indefinite-lived intangible assets for impairment, we may first perform an assessment of qualitative factors to determine if the fair value of the reporting unit or the intangible asset is more-likely-than-not greater than the carrying amount. Significant factors considered in this assessment include, but are not limited to, macro-economic conditions, market and industry conditions, cost considerations, the competitive environment, overall financial performance, and results of past impairment tests. If, based on a review of the qualitative factors, we determine it is more-likely-than-not that the fair value is greater than the carrying value, we may bypass a quantitative test for impairment. In performing the quantitative test for impairment of goodwill, we compare the fair value of each reporting unit with it carrying amount, including goodwill, in order to identify a potential impairment. Measurement of the fair value of a reporting unit is based on a fair value measure using the sum of the discounted estimated future cash flows. Estimates of forecasted cash flows involve measurement uncertainty, and it is therefore possible that reductions in the carrying value of goodwill may be required in the future because of changes in management’s future cash flow estimates. When the fair value of a reporting unit is less than it carrying amount, goodwill of the reporting unit is considered to be impaired. Effective January 1, 2020, we adopted the guidance in Accounting Standards Update (“ASU”) 2017-04, Simplifying the Test for Goodwill Impairment , which measures impairment amount as the excess of a reporting unit’s carrying amount over its fair value as determined by the quantitative test. |
Operating leases | Operating leases We determine if an arrangement is a lease at inception. Operating lease right-of-use assets (“ROU assets”) and short-term and long-term lease liabilities are included on the face of the consolidated balance sheet. ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, we use an incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Our 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 with lease and non-lease components, which are accounted for as a single lease component. For lease agreements with terms less than 12 months, we have elected the short-term lease measurement and recognition exemption, and recognize such lease payments on a straight-line basis over the lease term. |
Fair value measurement | Fair value measurement We determine the fair value of our assets and liabilities using a hierarchy established by the accounting guidance that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). The three levels of valuation hierarchy are defined as follows: ● Level 1 inputs to the valuation methodology are quoted prices for identical assets or liabilities in active markets. ● Level 2 inputs to the valuation methodology included quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets in inactive markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. ● Level 3 inputs to the valuation methodology is one or more unobservable inputs which are significant to the fair value measurement. The carrying amount of our financial instruments, including cash, accounts receivable, deposits, short-term portion of notes receivable and notes payable, and current liabilities approximate fair value due to their short-term nature. We do not have financial assets or liabilities that are required under US GAAP to be measured at fair value on a recurring basis. We have not elected to use fair value measurement option for any assets or liabilities for which fair value measurement is not presently required. We record assets and liabilities at fair value on nonrecurring basis as required by US GAAP. Assets recognized or disclosed at fair value in the condensed The following table summarizes changes in fair value measurements of the Derivative Liability during the three months ended December 31, 2021: Quoted Prices in Significant Active Markets Significant Other Unobservable For Identical Items Observable Inputs Inputs (Level 1) (Level 2) (Level 3) Total Derivative liabilities — — 959,888 959,888 Total $ — $ — $ 959,888 $ 959,888 The following table summarizes changes in fair value measurements of the Derivative Liability during the three months ended September 30, 2021: Quoted Prices in Significant Active Markets Significant Other Unobservable For Identical Items Observable Inputs Inputs (Level 1) (Level 2) (Level 3) Total Derivative liabilities — — 1,058,633 1,058,633 Total $ — $ — $ 1,058,633 $ 1,058,633 The following table summarizes changes in fair value measurements of the Derivative Liability during the three months ended December 31, 2021: Balance as of September 30, 2021 $ 1,058,633 Change in fair value (98,745) Balance as of December 31, 2021 $ 959,888 The following table summarizes the unobservable inputs used in the valuation of the derivatives during the three months ended December 31, 2021: Expected term 0.92 - 2 years Discount rate 7.12% - 11.09% Volatility 75% - 110.0% |
Convertible debt and derivative treatment | Convertible debt and derivative treatment When we issue debt with a conversion feature, we must first assess whether the conversion feature meets the requirements to be treated as a derivative, as follows: a) one or more underlyings, typically the price of our common stock; b) one or more notional amounts or payment provisions or both, generally the number of shares upon conversion; c) no initial net investment, which typically excludes the amount borrowed; and d) net settlement provisions, which in the case of convertible debt generally means the stock received upon conversion can be readily sold for cash. An embedded equity-linked component that meets the definition of a derivative does not have to be separated from the host instrument if the component qualifies for the scope exception for certain contracts involving an issuer’s own equity. The scope exception applies if the contract is both a) indexed to its own stock, and b) classified in shareholders’ equity in its statement of financial position. If the conversion feature within convertible debt meets the requirements to be treated as a derivative, we estimate the fair value of the convertible debt derivative using the Monte Carlo Method upon the date of issuance. If the fair value of the convertible debt derivative is higher than the face value of the convertible debt, the excess is immediately recognized as interest expense. Otherwise, the fair value of the convertible debt derivative is recorded as a liability with an offsetting amount recorded as a debt discount, which offsets the carrying amount of the debt. The convertible debt derivative is revalued at the end of each reporting period and any change in fair value is recorded as a gain or loss in the statement of operations. The debt discount is amortized through interest expense over the life of the debt. |
Convertible debt and beneficial conversion features | Convertible debt and beneficial conversion features If the conversion feature is not treated as a derivative, we assess whether it is a beneficial conversion feature (“BCF”). A BCF exists if the conversion price of the convertible debt instrument is less than the stock price on the commitment date. This typically occurs when the conversion price is less than the fair value of the stock on the date the instrument was issued. The value of a BCF is equal to the intrinsic value of the feature, the difference between the conversion price and the common stock into which it is convertible and is recorded as additional paid in capital and as a debt discount in the consolidated balance sheets. We amortize the balance over the life of the underlying debt as amortization of debt discount expense in the consolidated statements of operations. If the debt is retired early, the associated debt discount is then recognized immediately as amortization of debt discount expense in the consolidated statements of operations. If the conversion feature does not qualify for either the derivative treatment or as a BCF, the convertible debt is treated as traditional debt. |
Advertising costs | Advertising costs We expense all advertising costs as incurred. Advertising and marketing costs for the three months ended December 31, 2021, and 2020 were $1,198,000 and $780,000, respectively. |
Revenue recognition | Revenue recognition We recognize revenue in accordance with ASC 606 , Revenue from Contracts with Customers ● executed contracts with our customers that it believes are legally enforceable; ● identification of performance obligations in the respective contract; ● determination of the transaction price for each performance obligation in the respective contract; ● allocation of the transaction price to each performance obligation; and ● recognition of revenue only when we satisfy each performance obligation. Performance obligations and significant judgments Our revenue streams can be categorized into the following performance obligations and recognition patterns: o Delivery of streaming services including content encoding and hosting. We recognize revenue over the term of the service based on bandwidth usage. o Delivery of subscription content services in customized formats. We recognize revenue over the term of the service. o Delivery of hardware for ongoing subscription content delivery through software. We recognize revenue at the point of hardware delivery. o Revenue share arrangements, where platform providers distribute our licensed content and providers pay us a portion of the usage-based advertising revenues. Transaction prices for performance obligations are explicitly outlined in relevant agreements; therefore, we do not believe that significant judgments are required with respect to the determination of the transaction price, including any variable consideration identified. |
Cost of revenue | Cost of revenue Cost of revenue represents the cost of the delivered hardware and related bundled software and is recognized at the time of sale. For ongoing licensing and hosting fees, cost of sales is recognized over time based on usage patterns. |
Deferred income | Deferred income We bill subscription services in advance of when the service period is performed. The deferred income recorded at December 31, 2021, and September 30, 2021, represents our accounting for the timing difference between when the subscription fees are received and when the performance obligation is satisfied. |
Net loss per share | Net loss per share We account for net loss per share in accordance with ASC subtopic 260-10, Earnings Per Share Basic net loss per share is computed by dividing net loss attributable to common stockholders by the weighted average number of shares of common stock outstanding during each period. It excludes the dilutive effects of any potentially issuable common shares. Diluted net loss per share is calculated by including any potentially dilutive share issuances in the denominator. The following securities are excluded from the calculation of weighted average diluted shares at December 31, 2021, and December 31, 2020, respectively, because their inclusion would have been anti-dilutive. December 31, December 31, 2021 2020 Options to purchase common stock 18,638,806 8,312,306 Warrants to purchase common stock 15,464,700 8,585,558 Series A preferred stock — 3,066,700 Series B preferred stock 20,000,000 20,000,000 Convertible debentures 5,393,685 7,079,622 Total common stock equivalents 59,497,191 47,044,186 |
Stock-based compensation | Stock-based compensation Share-based compensation issued to employees is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the requisite service period. We measure the fair value of the share-based compensation issued to non-employees using the stock price observed in the trading market (for stock transactions) or the fair value of the award (for non-stock transactions), which were more reliably determinable measures of fair value than the value of the services being rendered. The measurement date is the earlier of (1) the date at which commitment for performance by the counterparty to earn the equity instruments is reached, or (2) the date at which the counterparty’s performance is complete. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Schedule of fair value measurements | Quoted Prices in Significant Active Markets Significant Other Unobservable For Identical Items Observable Inputs Inputs (Level 1) (Level 2) (Level 3) Total Derivative liabilities — — 959,888 959,888 Total $ — $ — $ 959,888 $ 959,888 |
Schedule of changes in fair value measurements | Balance as of September 30, 2021 $ 1,058,633 Change in fair value (98,745) Balance as of December 31, 2021 $ 959,888 The following table summarizes the unobservable inputs used in the valuation of the derivatives during the three months ended December 31, 2021: Expected term 0.92 - 2 years Discount rate 7.12% - 11.09% Volatility 75% - 110.0% |
Schedule of weighted average diluted shares | The following securities are excluded from the calculation of weighted average diluted shares at December 31, 2021, and December 31, 2020, respectively, because their inclusion would have been anti-dilutive. December 31, December 31, 2021 2020 Options to purchase common stock 18,638,806 8,312,306 Warrants to purchase common stock 15,464,700 8,585,558 Series A preferred stock — 3,066,700 Series B preferred stock 20,000,000 20,000,000 Convertible debentures 5,393,685 7,079,622 Total common stock equivalents 59,497,191 47,044,186 |
INVENTORY (Tables)
INVENTORY (Tables) | 3 Months Ended |
Dec. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Schedule of inventory | Our finished goods inventory consisted of the following on December 31, 2021, and September 30, 2021: December 31, September 30, 2021 2021 Computers $ 6,535 $ 6,881 Hasp keys 3,416 3,581 Loop player 104,772 212,586 Total inventory $ 114,723 $ 223,048 |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 3 Months Ended |
Dec. 31, 2021 | |
Table Text Block Supplement [Abstract] | |
Schedule of other intangible assets | Our other intangible assets, each definite lived assets, consisted of the following as of December 31, 2021, and September 30, 2021: December 31, September 30, Useful life 2021 2021 Customer relationships nine years $ 1,012,000 $ 1,012,000 Content library two years 198,000 198,000 Total intangible assets, gross 1,210,000 1,210,000 Less: accumulated amortization (535,333) (507,222) Total (535,333) (507,222) Total intangible assets, net $ 674,667 $ 702,778 |
LEASES (Tables)
LEASES (Tables) | 3 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Schedule of lease liability | December 31, September 30, 2021 2021 Short term portion $ 170,533 $ 167,101 Long term portion 32,749 75,530 Total lease liability $ 203,282 $ 242,631 |
Schedule of maturity analysis | Maturity analysis under these lease agreements are as follows: 2022 $ 185,834 2023 37,584 Total undiscounted cash flows 223,418 Less: 10% Present value discount (20,136) Lease liability $ 203,282 |
Schedule of lease expense | Three months ended December 31. 2021 2020 Operating lease expense $ 44,444 $ 44,444 Short-term lease expense 2,100 3,033 Total lease expense $ 46,544 $ 47,477 |
Schedule of weighted-average remaining lease term and discount rate | Weighted-average remaining lease term and discount rate for operating leases are as follows: Weighted-average remaining lease term 1.45 years Weighted-average discount rate 10 % |
ACCOUNTS PAYABLE AND ACCRUED _2
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Tables) | 3 Months Ended |
Dec. 31, 2021 | |
Payables and Accruals [Abstract] | |
Schedule of accounts payable and accrued expenses | Accounts payable and accrued expenses consisted of the following as of December 31, 2021, and September 30, 2021: December 31, September 30, 2021 2021 Accounts payable $ 1,465,271 $ 1,147,585 Interest payable 201,818 106,631 Accrued liabilities 1,600,564 941,440 Payroll liabilities 20,250 20,250 Total accounts payable and accrued expenses $ 3,287,903 $ 2,215,906 |
CONVERTIBLE DEBENTURES PAYABLE
CONVERTIBLE DEBENTURES PAYABLE (Tables) | 3 Months Ended |
Dec. 31, 2021 | |
Debt Instruments [Abstract] | |
Schedule of convertible debentures to related parties | Convertible debentures as of December 31, 2021: Unpaid Contractual Net Carrying Value Principal Interest Rates Contractual Warrants Related party convertible debentures: Current Long Term Balance Cash PIK Maturity Date issued $3,000,000 convertible debenture amended October 23, 2020 (1) $ 558,689 $ 726,839 $ 2,442,896 10% 12/1/2023 3,550,709 $750,000 convertible debenture, December 1, 2020 (2) 582,256 — 750,000 4% 6% 12/1/2022 68,182 $800,000 convertible debenture, April 1, 2021 (2) 591,090 — 800,000 4% 6% 12/1/2022 72,727 $400,000 convertible debenture, May 1, 2021 (2) 289,407 — 400,000 4% 6% 12/1/2022 36,364 $400,000 convertible debenture, June 2, 2021 (2) 283,769 — 400,000 4% 6% 12/1/2022 36,364 Total related party convertible debentures, net $ 2,305,211 $ 726,839 $ 4,792,896 Convertible debentures: $350,000 convertible debenture, January 12, 2021 (2) 266,384 — 350,000 4% 6% 12/1/2022 87,500 $250,000 convertible debenture, May 21, 2021 (2) 179,867 — 250,000 4% 6% 12/1/2022 22,727 Total convertible debentures, net $ 446,251 $ — $ 600,000 Convertible debentures as of September 30, 2021: Unpaid Contractual Net Carrying Value Principal Interest Rates Contractual Warrants Related party convertible debentures: Current Long Term Balance Cash PIK Maturity Date issued $3,000,000 convertible debenture amended October 23, 2020 (1) $ 530,226 $ 876,256 $ 2,715,582 10% 12/1/2023 3,550,709 $750,000 convertible debenture, December 1, 2020 (2) — 536,508 750,000 4% 6% 12/1/2022 68,182 $800,000 convertible debenture, April 1, 2021 (2) — 534,114 800,000 4% 6% 12/1/2022 72,727 $400,000 convertible debenture, May 1, 2021 (2) — 259,246 400,000 4% 6% 12/1/2022 36,364 $400,000 convertible debenture, June 2, 2021 (2) — 252,070 400,000 4% 6% 12/1/2022 36,364 Total related party convertible debentures, net $ 530,226 $ 2,458,194 $ 5,065,582 Convertible debentures: $350,000 convertible debenture, January 12, 2021 (3) — 243,579 350,000 4% 6% 12/1/2022 87,500 $250,000 convertible debenture, May 21, 2021 (4) — 160,741 250,000 4% 6% 12/1/2022 22,727 Total convertible debentures, net $ — $ 404,320 $ 600,000 |
Schedule of interest expense related to the contractual interest coupon and the amortization of debt discounts on the convertible debentures | Three months ended December 31, 2021 2020 Interest expense $ 145,869 $ 212,372 Amortization of debt discounts 358,248 183,533 Total $ 504,117 $ 395,905 |
Schedule of maturity analysis under total convertible debentures | For the nine months remaining 2022 $ 859,518 2023 4,200,761 2024 332,616 Convertible debentures payable, related and non related party 5,392,895 Less: Debt discount on convertible debentures payable (1,914,595) Total convertible debentures payable, related and non related party, net $ 3,478,300 |
STOCK OPTIONS AND WARRANTS (Tab
STOCK OPTIONS AND WARRANTS (Tables) | 3 Months Ended |
Dec. 31, 2021 | |
Share-based Payment Arrangement, Additional Disclosure [Abstract] | |
Schedule of stock option activity | The following table summarizes the stock option activity for the three months ended December 31, 2021: Weighted Weighted Average Average Remaining Aggregate Options Exercise Price Contractual Term Intrinsic Value Outstanding at September 30, 2021 17,833,356 $ 1.04 8.30 $ 25,478,339 Grants 911,200 2.30 9.77 — Exercised — — — — Expired — — — — Forfeited (105,750) 1.10 — (3,454,110) Outstanding at December 31, 2021 18,638,806 $ 1.10 8.13 $ 22,024,229 Exercisable at December 31, 2021 12,175,833 $ 0.95 7.68 $ 16,073,164 |
Schedule of related to stock options | The following table presents information related to stock options on December 31, 2021: Options outstanding Weighted Options average exercisable Exercise Number of remaining life number of price options in years options 0.86 1,148,371 4.66 1,148,371 0.66 4,663,935 6.84 4,663,935 0.89 2,500,000 8.46 1,714,000 1.10 7,915,299 8.87 3,669,990 0.57 300,000 9.17 300,000 2.84 450,000 9.33 250,000 2.75 600,000 9.34 116,667 2.35 125,000 9.72 6,944 2.40 50,000 9.57 — 2.50 50,000 9.59 50,000 2.30 836,200 9.77 255,925 18,638,806 12,175,833 |
Schedule of fair value of options | We calculated the fair value of options issued using the Black-Scholes option pricing model, with the following assumptions: December 31, 2021 Weighted average fair value of options granted $ 2.03 Expected life 5.00 – 6.00 years Risk-free interest rate 0.01 - 1.47 % Expected volatility 55.80 - 69.60 % Expected dividends yield 0 % Forfeiture rate 0 % |
Schedule of warrants outstanding and related prices | The following table summarizes the changes in warrants outstanding and the related prices for the shares of our common stock: Warrants outstanding Warrants exercisable Weighted Weighted average average remaining Weighted remaining contractual average contractual Number life exercise Number life Exercise prices outstanding (years) price exercisable (years) $ 0.86 3,850,709 5.37 $ 0.86 3,850,709 5.37 0.38 2,000,000 4.93 0.38 2,000,000 4.93 0.75 2,666,667 8.20 0.75 2,666,667 8.20 2.75 323,864 0.92 2.75 323,864 0.92 2.80 50,000 9.32 2.80 50,000 9.32 2.75 6,573,460 2.75 2.75 6,573,460 2.75 |
Schedule of warrant activity | The following table summarizes the warrant activity for the nine months ended December 31, 2021: Weighted average exercise Number of price per shares share Outstanding at September 30, 2021 15,464,700 $ 1.63 Issued — — Exercised — — Expired — — Outstanding at December 31, 2021 15,464,700 $ 1.63 |
Schedule of fair value of warrants issued | December 31, 2021 Weighted average fair value of warrants granted $ 1.15 Expected life 1.75 - 10 years Risk-free interest rate 0.15% to 1.58% Expected volatility 57.30% to 58.65% Expected dividends yield 0 % Forfeiture rate 0 % |
BUSINESS (Details Narrative)
BUSINESS (Details Narrative) - USD ($) | 3 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Cash | $ 1,662,098 | $ 4,162,548 | |
Accumulated deficit | (71,116,411) | $ (66,842,416) | |
Net cash used in operating activities | $ (3,477,763) | $ (2,327,034) |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2021USD ($)segment | Dec. 31, 2020USD ($) | Sep. 30, 2021USD ($) | |
Accounting Policies [Abstract] | |||
Amount of investments that qualify as VIE | $ 0 | $ 0 | |
Number of reportable segments | segment | 1 | ||
Number of operating segments | segment | 1 | ||
Cash Equivalents, at Carrying Value | $ 0 | 0 | |
FDIC insurance Limit | 1,162,098 | 3,655,716 | |
Allowance for doubtful accounts | 446,812 | $ 216,238 | |
Advertising costs | $ 1,198,000 | $ 780,000 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Fair Value Measurement - Fair Value Measurements (Details) - USD ($) | Dec. 31, 2021 | Sep. 30, 2021 |
Financial Liabilities Fair Value Disclosure [Abstract] | ||
Derivative liabilities | $ 1,058,633 | |
Fair Value, Recurring [Member] | ||
Financial Liabilities Fair Value Disclosure [Abstract] | ||
Derivative liabilities | $ 959,888 | 1,058,633 |
Financial Liabilities Fair Value Disclosure, Total | 959,888 | 1,058,633 |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Financial Liabilities Fair Value Disclosure [Abstract] | ||
Derivative liabilities | 959,888 | |
Financial Liabilities Fair Value Disclosure, Total | $ 959,888 | $ 1,058,633 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Fair Value Measurement - Changes in Fair Value Measurements (Details) | 3 Months Ended |
Dec. 31, 2021USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability Value, Beginning Balance | $ 1,058,633 |
Change in fair value | (98,745) |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability Value, Ending Balance | $ 959,888 |
Minimum [Member] | Derivative [Member] | Measurement Input, Expected Term [Member] | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Derivative Liability, Expected Term | 11 months 1 day |
Minimum [Member] | Derivative [Member] | Measurement Input, Discount Rate [Member] | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Derivative Liability, Measurement Input | 7.12 |
Minimum [Member] | Derivative [Member] | Measurement Input, Offered Price [Member] | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Derivative Liability, Measurement Input | 75 |
Maximum [Member] | Derivative [Member] | Measurement Input, Expected Term [Member] | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Derivative Liability, Expected Term | 2 years |
Maximum [Member] | Derivative [Member] | Measurement Input, Discount Rate [Member] | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Derivative Liability, Measurement Input | 11.09 |
Maximum [Member] | Derivative [Member] | Measurement Input, Offered Price [Member] | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Derivative Liability, Measurement Input | 110 |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) - shares | 3 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Total common stock equivalents | 59,497,191 | 47,044,186 |
Series A Convertible Preferred Stock [Member] | ||
Total common stock equivalents | 3,066,700 | |
Series B Convertible Preferred Stock [Member] | ||
Total common stock equivalents | 20,000,000 | 20,000,000 |
Options To Purchase Common Stock [Member] | ||
Total common stock equivalents | 18,638,806 | 8,312,306 |
Warrants To Purchase Common Stock [Member] | ||
Total common stock equivalents | 15,464,700 | 8,585,558 |
Convertible Debentures [Member] | ||
Total common stock equivalents | 5,393,685 | 7,079,622 |
INVENTORY (Details)
INVENTORY (Details) - USD ($) | Dec. 31, 2021 | Sep. 30, 2021 |
Total inventory | $ 114,723 | $ 223,048 |
Computers [Member] | ||
Total inventory | 6,535 | 6,881 |
Hasp Keys [Member] | ||
Total inventory | 3,416 | 3,581 |
Loop Player [Member] | ||
Total inventory | $ 104,772 | $ 212,586 |
LICENSE CONTENT ASSETS (Details
LICENSE CONTENT ASSETS (Details Narrative) - USD ($) | 3 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2021 | |
Term of license content asset | 2 years | ||
License content asset - current | $ 539,208 | $ 850,263 | |
License content asset - non current | 365,360 | 365,360 | |
License content liability | 404,000 | ||
License content liability - current | 404,000 | $ 985,000 | |
License content liability - non current | 0 | ||
Payments for license content liabilities | 581,000 | ||
Amortization expense | 32,403 | $ 338,260 | |
Payable in 2022 | 404,000 | ||
License Content Asset [Member] | |||
Impairment of license asset | 2,260,799 | ||
Amortization expense | $ 311,055 | $ 170,682 | |
Useful life | 2 years | ||
Amortization expense, 2022 | $ 746,722 | ||
Amortization expense, 2023 | $ 157,846 |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS (Details) - USD ($) | 3 Months Ended | |
Dec. 31, 2021 | Sep. 30, 2021 | |
Total intangible assets, gross | $ 1,210,000 | $ 1,210,000 |
Less: accumulated amortization | (535,333) | (507,222) |
Total intangible accumulated amortization | (535,333) | (507,222) |
Total intangible assets, net | $ 674,667 | 702,778 |
Useful life | 6 years | |
Customer Relationships [Member] | ||
Total intangible assets, gross | $ 1,012,000 | 1,012,000 |
Useful life | 9 years | |
Non-recoverable license content assets [Member] | ||
Total intangible assets, gross | $ 198,000 | $ 198,000 |
Useful life | 2 years |
GOODWILL AND OTHER INTANGIBLE_4
GOODWILL AND OTHER INTANGIBLE ASSETS (Details narrative) - USD ($) | 3 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Goodwill balance | $ 1,970,321 | $ 1,970,321 | |
Useful life | 6 years | ||
Amortization expense | $ 32,403 | $ 335,078 | |
Finite-Lived Intangible Assets, Amortization Expense, Rolling Year Two | 112,444 | ||
Finite-Lived Intangible Assets, Amortization Expense, Rolling Year Three | 112,444 | ||
Finite-Lived Intangible Assets, Amortization Expense, Rolling Year Four | 112,444 | ||
Finite-Lived Intangible Assets, Amortization Expense, Rolling Year Five | 112,444 | ||
Finite-Lived Intangible Assets, Amortization Expense, Rolling after Year Five | $ 112,444 |
LEASES (Details)
LEASES (Details) - USD ($) | Dec. 31, 2021 | Sep. 30, 2021 |
Leases [Abstract] | ||
Short term portion | $ 170,533 | $ 167,101 |
Long term portion | 32,749 | 75,530 |
Total lease liability | $ 203,282 | $ 242,631 |
LEASES (Details 1)
LEASES (Details 1) - USD ($) | Dec. 31, 2021 | Sep. 30, 2021 |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | ||
2022 | $ 185,834 | |
2023 | 37,584 | |
Total undiscounted cash flows | 223,418 | |
Less: 10% Present value discount | (20,136) | |
Lease liability | $ 203,282 | $ 242,631 |
LEASES (Details 2)
LEASES (Details 2) - USD ($) | 3 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Leases. | ||
Operating lease expense | $ 44,444 | $ 44,444 |
Short-term lease expense | 2,100 | 3,033 |
Total lease expense | $ 46,544 | $ 47,477 |
LEASES (Details 3)
LEASES (Details 3) | Dec. 31, 2021 |
Lease Detail 3 [Abstract] | |
Weighted-average remaining lease term | 1 year 5 months 12 days |
Weighted-average discount rate | 10.00% |
LEASES (Details Narrative)
LEASES (Details Narrative) - USD ($) | 3 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Lease Detail Narrative [Abstract] | ||
Cash payments against lease liabilities | $ 45,238 | $ 44,086 |
Accretion on lease liability | $ 5,889 | $ 9,584 |
ACCOUNTS PAYABLE AND ACCRUED _3
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Details) - USD ($) | Dec. 31, 2021 | Sep. 30, 2021 |
Accounts Payable And Accrued Expenses. | ||
Accounts payable | $ 1,465,271 | $ 1,147,585 |
Interest payable | 201,818 | 106,631 |
Accrued liabilities | 1,600,564 | 941,440 |
Payroll liabilities | 20,250 | 20,250 |
Total accounts payable and accrued expenses | $ 3,287,903 | $ 2,215,906 |
NOTE PAYABLE (Details Narrative
NOTE PAYABLE (Details Narrative) - Paycheck Protection Program, CARES Act Loan [Member] | Dec. 28, 2020USD ($) |
Loan forgiveness amount | $ 486,638 |
Accrued interest forgiven | $ 3,413 |
CONVERTIBLE DEBENTURES PAYABL_2
CONVERTIBLE DEBENTURES PAYABLE (Details 1) - USD ($) | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2021 | Sep. 30, 2021 | Dec. 01, 2020 | |
Current - related parties | $ 2,305,211 | $ 530,226 | |
Net Carrying Value Long Term - related party | 726,839 | 2,458,194 | |
Unpaid Principal Balance - related parties | 4,792,896 | 5,065,582 | |
Current - nonrelated parties | 446,251 | ||
Net Carrying Value Long Term - nonrelated party | 404,320 | ||
Convertible debt, less current portion, net | 1,243,115 | ||
Unpaid Principal Balance - nonrelated parties | 600,000 | 600,000 | |
Warrants issued | 492,000 | ||
$3,000,000 Convertible Debenture Amended October 23, 2020 | |||
Convertible debenture | 3,000,000 | 3,000,000 | |
Current - related parties | 558,689 | 530,226 | |
Net Carrying Value Long Term - related party | 726,839 | 876,256 | |
Unpaid Principal Balance - related parties | $ 2,442,896 | $ 2,715,582 | |
Percentage of cash interest | 10.00% | 10.00% | |
Interest rate | 10.00% | ||
Maturity date | Dec. 1, 2023 | Dec. 1, 2023 | |
Warrants issued | $ 3,550,709 | $ 3,550,709 | |
$750,000 convertible debenture, December 1, 2020 | |||
Convertible debenture | 750,000 | 750,000 | |
Current - related parties | 582,256 | ||
Net Carrying Value Long Term - related party | 536,508 | ||
Unpaid Principal Balance - related parties | $ 750,000 | $ 750,000 | |
Percentage of cash interest | 4.00% | 4.00% | |
Interest rate | 6.00% | 6.00% | |
Maturity date | Dec. 1, 2022 | Dec. 1, 2022 | |
Warrants issued | $ 68,182 | $ 68,182 | |
$800,000 convertible debenture, April 1, 2021 | |||
Convertible debenture | 800,000 | 800,000 | |
Current - related parties | 591,090 | ||
Net Carrying Value Long Term - related party | 534,114 | ||
Unpaid Principal Balance - related parties | $ 800,000 | $ 800,000 | |
Percentage of cash interest | 4.00% | 4.00% | |
Interest rate | 6.00% | 6.00% | |
Maturity date | Dec. 1, 2022 | Dec. 1, 2022 | |
Warrants issued | $ 72,727 | $ 72,727 | |
$400,000 convertible debenture, May 1, 2021 | |||
Convertible debenture | 400,000 | 400,000 | |
Current - related parties | 289,407 | ||
Net Carrying Value Long Term - related party | 259,246 | ||
Unpaid Principal Balance - related parties | $ 400,000 | $ 400,000 | |
Percentage of cash interest | 4.00% | 4.00% | |
Interest rate | 6.00% | 6.00% | |
Maturity date | Dec. 1, 2022 | Dec. 1, 2022 | |
Warrants issued | $ 36,364 | $ 36,364 | |
$400,000 convertible debenture, June 2, 2021 | |||
Convertible debenture | 400,000 | 400,000 | |
Current - related parties | 283,769 | ||
Net Carrying Value Long Term - related party | 252,070 | ||
Unpaid Principal Balance - related parties | $ 400,000 | $ 400,000 | |
Percentage of cash interest | 4.00% | 4.00% | |
Interest rate | 6.00% | 6.00% | |
Maturity date | Dec. 1, 2022 | Dec. 1, 2022 | |
Warrants issued | $ 36,364 | $ 36,364 | |
$287,000 convertible debenture amended October 22, 2020 | |||
Convertible debenture | 350,000 | ||
$350,000 convertible debenture, January 12, 2021 | |||
Convertible debenture | 350,000 | ||
Current - nonrelated parties | 266,384 | ||
Net Carrying Value Long Term - nonrelated party | 243,579 | ||
Unpaid Principal Balance - nonrelated parties | $ 350,000 | $ 350,000 | |
Percentage of cash interest | 4.00% | 4.00% | |
Interest rate | 6.00% | 6.00% | |
Maturity date | Dec. 1, 2022 | Dec. 1, 2022 | |
Warrants issued | $ 87,500 | $ 87,500 | |
$250,000 convertible debenture, May 21, 2021 | |||
Convertible debenture | 250,000 | ||
Current - nonrelated parties | 179,867 | ||
Net Carrying Value Long Term - nonrelated party | 160,741 | ||
Unpaid Principal Balance - nonrelated parties | $ 250,000 | $ 250,000 | |
Percentage of cash interest | 4.00% | 4.00% | |
Interest rate | 6.00% | 6.00% | |
Maturity date | Dec. 1, 2022 | Dec. 1, 2022 | |
Warrants issued | $ 22,727 | $ 22,727 | |
$400,000 convertible debenture amended August 20, 2019 | |||
Convertible debenture | $ 250,000 | ||
Convertible Debentures Due on due December 1, 2022 [Member] | |||
Percentage of cash interest | 4.00% | ||
Debentures Subject to Mandatory Redemption [Member] | $750,000 convertible debenture, December 1, 2020 | |||
Convertible debenture | 750,000 | ||
Debentures Subject to Mandatory Redemption [Member] | $800,000 convertible debenture, April 1, 2021 | |||
Convertible debenture | 800,000 | ||
Debentures Subject to Mandatory Redemption [Member] | $400,000 convertible debenture, May 1, 2021 | |||
Convertible debenture | 400,000 | ||
Debentures Subject to Mandatory Redemption [Member] | $350,000 convertible debenture, January 12, 2021 | |||
Convertible debenture | 350,000 | ||
Debentures Subject to Mandatory Redemption [Member] | $250,000 convertible debenture, May 21, 2021 | |||
Convertible debenture | $ 250,000 |
CONVERTIBLE DEBENTURES PAYABL_3
CONVERTIBLE DEBENTURES PAYABLE (Details 2) - USD ($) | 3 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Debt Instruments [Abstract] | ||
Interest exepense | $ 145,869 | $ 212,372 |
Amortization of debt discounts | 358,248 | 183,533 |
Total interest expense and amortization of debt discounts | $ 504,117 | $ 395,905 |
CONVERTIBLE DEBENTURES PAYABL_4
CONVERTIBLE DEBENTURES PAYABLE (Details 3) | Dec. 31, 2021USD ($) |
Debt Disclosure [Abstract] | |
For the nine months remaining 2022 | $ 859,518 |
2023 | 4,200,761 |
2024 | 332,616 |
Convertible debentures payable, related and non related party | 5,392,895 |
Less: Debt discount on convertible debentures payable | (1,914,595) |
Total convertible debentures payable, related and non related party, net | $ 3,478,300 |
CONVERTIBLE DEBENTURES PAYABL_5
CONVERTIBLE DEBENTURES PAYABLE (Details Narrative) - USD ($) | Dec. 01, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2021 |
Number of warrants issued | 300,000 | |||
Exercise price of warrants | $ 1.63 | $ 1.63 | ||
Beneficial conversion feature recorded as debt discount | $ 750,000 | |||
Debentures balance | $ 600,000 | $ 600,000 | ||
Number of shares issued | 704,000 | |||
Gain on extinguishment of debt, net | 490,051 | $ 13,900 | ||
$3,000,000 Convertible Debenture Amended October 23, 2020 | ||||
Convertible debenture | $ 3,000,000 | $ 3,000,000 | ||
Debt Instrument, Convertible, Conversion Price | $ 0.60 | |||
Interest rate | 10.00% | |||
Description of monthly installments | monthly payments of unpaid interest accrued at 12.5% per annum will be paid in arrears through March 31, 2021, beginning April 1, 2021, we began paying equal monthly installments of principal and interest at 10% per annum through December 1, 2023 | |||
Number of warrants issued | 3,550,709 | |||
Exercise price of warrants | $ 0.86 | |||
Expected life in years | 10 years | |||
Beneficial conversion feature recorded as debt discount | $ 612,313 | |||
Allocated fair value of warrants as additional debt discount | $ 2,387,687 | |||
Percentage of cash interest | 10.00% | 10.00% | ||
$750,000 convertible debenture, December 1, 2020 | ||||
Convertible debenture | $ 750,000 | $ 750,000 | ||
Interest rate | 6.00% | 6.00% | ||
Beneficial conversion feature recorded as debt discount | $ 339,216 | |||
Allocated fair value of warrants as additional debt discount | $ 26,770 | |||
Percentage of cash interest | 4.00% | 4.00% | ||
$750,000 convertible debenture, December 1, 2020 | Private Placement [Member] | ||||
Convertible debenture and warranty purchase agreement amount | $ 3,000,000 | |||
$800,000 convertible debenture, April 1, 2021 | ||||
Convertible debenture | $ 800,000 | $ 800,000 | ||
Interest rate | 6.00% | 6.00% | ||
Beneficial conversion feature recorded as debt discount | $ 319,431 | |||
Allocated fair value of warrants as additional debt discount | $ 60,406 | |||
Percentage of cash interest | 4.00% | 4.00% | ||
$400,000 convertible debenture, May 1, 2021 | ||||
Convertible debenture | $ 400,000 | $ 400,000 | ||
Interest rate | 6.00% | 6.00% | ||
Beneficial conversion feature recorded as debt discount | $ 159,715 | |||
Allocated fair value of warrants as additional debt discount | $ 31,309 | |||
Percentage of cash interest | 4.00% | 4.00% | ||
$400,000 convertible debenture, June 2, 2021 | ||||
Convertible debenture | $ 400,000 | $ 400,000 | ||
Interest rate | 6.00% | 6.00% | ||
Percentage of cash interest | 4.00% | 4.00% | ||
$400,000 convertible debenture, June 2, 2020 | ||||
Beneficial conversion feature recorded as debt discount | $ 159,715 | |||
Allocated fair value of warrants as additional debt discount | 30,481 | |||
$287,000 convertible debenture amended October 22, 2020 | ||||
Convertible debenture | $ 350,000 | |||
$350,000 convertible debenture, January 12, 2021 | ||||
Convertible debenture | $ 350,000 | |||
Interest rate | 6.00% | 6.00% | ||
Beneficial conversion feature recorded as debt discount | $ 139,751 | |||
Allocated fair value of warrants as additional debt discount | $ 31,282 | |||
Percentage of cash interest | 4.00% | 4.00% | ||
Debentures balance | $ 350,000 | $ 350,000 | ||
$250,000 convertible debenture, May 21, 2021 | ||||
Convertible debenture | $ 250,000 | |||
Interest rate | 6.00% | 6.00% | ||
Beneficial conversion feature recorded as debt discount | $ 99,822 | |||
Allocated fair value of warrants as additional debt discount | $ 14,940 | |||
Percentage of cash interest | 4.00% | 4.00% | ||
Debentures balance | $ 250,000 | $ 250,000 | ||
Convertible Debentures Due on due December 1, 2022 [Member] | ||||
Percentage of cash interest | 4.00% | |||
Percentage of payment in kind interest | 6.00% | |||
Senior Secured Convertible Promissory Debentures [Member] | ||||
Number of warrants issued | 0 | 68,182 | ||
Senior Secured Convertible Promissory Debentures [Member] | Private Placement [Member] | ||||
Minimum subscription amount | $ 250,000 | |||
Aggregate exercise price | $ 750,000 | |||
Warrants Exercisable Shares | 272,727 | |||
Debentures Subject to Mandatory Redemption [Member] | $750,000 convertible debenture, December 1, 2020 | ||||
Convertible debenture | $ 750,000 | |||
Debentures Subject to Mandatory Redemption [Member] | $800,000 convertible debenture, April 1, 2021 | ||||
Convertible debenture | 800,000 | |||
Debentures Subject to Mandatory Redemption [Member] | $400,000 convertible debenture, May 1, 2021 | ||||
Convertible debenture | 400,000 | |||
Debentures Subject to Mandatory Redemption [Member] | $400,000 convertible debenture, June 2, 2020 | ||||
Convertible debenture | 400,000 | |||
Debentures Subject to Mandatory Redemption [Member] | $350,000 convertible debenture, January 12, 2021 | ||||
Convertible debenture | 350,000 | |||
Debentures Subject to Mandatory Redemption [Member] | $250,000 convertible debenture, May 21, 2021 | ||||
Convertible debenture | $ 250,000 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) | 3 Months Ended |
Dec. 31, 2021USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | |
Loss contingencies | $ 0 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - Convertible Debt [Member] - USD ($) | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2021 | |
Related party amounts of transaction | $ 3,130,834 | $ 2,448,871 | |
Related party interest expense | $ 223,818 | $ 21,708 |
STOCKHOLDERS' EQUITY (DEFICIT)
STOCKHOLDERS' EQUITY (DEFICIT) (Details Narrative) | 3 Months Ended | ||
Dec. 31, 2020USD ($)shares | Dec. 31, 2021Vote$ / sharesshares | Sep. 30, 2021$ / sharesshares | |
Preferred stock, shares authorized | 16,666,667 | ||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.0001 | ||
Common stock, shares authorized | 316,666,667 | 316,666,667 | |
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | |
Common stock, shares issues | 116,800,982 | 133,470,020 | 133,470,020 |
Common stock, shares outstanding | 116,800,982 | 133,470,019 | 133,470,019 |
Number of shares issued | 704,000 | ||
Number of shares issued, value | $ | $ 900,000 | ||
Number of shares issued for the purchase of certain intangible assets | 1,369,863 | ||
Number of shares issued for the purchase of certain intangible assets, value | $ | $ 2,671,096 | ||
Shares issued for debt settlement (in shares) | 97,891 | ||
Shares issued for investment in unconsolidated entity | $ | $ 194,803 | ||
Warrants issued to consultant | $ | 492,000 | ||
Exercise price of warrants | $ / shares | $ 1.63 | $ 1.63 | |
Number of shares issued, value | $ | 880,000 | ||
Proceeds from issuing common stock subscribed | $ | $ 350,000 | ||
Common Stock | |||
Number of shares issued | 757,333 | ||
Number of shares issued, value | $ | $ 75 | ||
Shares issued for debt settlement (in shares) | 97,891 | ||
Shares issued for investment in unconsolidated entity | $ | $ 10 | ||
License Content Asset [Member] | |||
Number of shares issued for services | 1,180,880 | ||
Number of shares issued for services, value | $ | $ 2,065,878 | ||
Asset impairment charges | $ | $ 2,260,799 | ||
EON Media Group [Member] | |||
Number of shares issued | 454,463 | ||
Number of shares issued, value | $ | $ 863,480 | ||
Ownership percentage | 20.00% | ||
Series A Convertible Preferred Stock [Member] | |||
Preferred stock, shares authorized | 3,333,334 | ||
Series B Convertible Preferred Stock [Member] | |||
Preferred stock, shares authorized | 3,333,334 | 3,333,334 | |
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | |
Preferred stock, shares issues | 200,000 | 200,000 | |
Preferred stock, shares outstanding | 200,000 | 200,000 | |
Preferred stock, liquidation preference (in dollars per share) | $ / shares | $ 1.50 | $ 1.50 | |
Preferred stock, number of votes per share | Vote | 100 | ||
Preferred stock, convertible, conversion ratio | 100 |
STOCK OPTIONS AND WARRANTS (Det
STOCK OPTIONS AND WARRANTS (Details) - USD ($) | 3 Months Ended | 12 Months Ended |
Dec. 31, 2021 | Sep. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||
Outstanding at the beginning | 17,833,356 | |
Grants | 911,200 | |
Forfeited | (105,750) | |
Outstanding at the end | 18,638,806 | 17,833,356 |
Exercisable | 12,175,833 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | ||
Outstanding at the beginning | $ 1.04 | |
Grants | 2.30 | |
Forfeited | 1.10 | |
Outstanding at the end | 1.10 | $ 1.04 |
Exercisable | $ 0.95 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||
Outstanding at the beginning | 8 years 3 months 18 days | |
Grants | 9 years 9 months 7 days | |
Outstanding at the end | 8 years 1 month 17 days | |
Exercisable | 7 years 8 months 4 days | |
Outstanding at the beginning | $ 25,478,339 | |
Forfeited | (3,454,110) | |
Outstanding at the end | 22,024,229 | $ 25,478,339 |
Exercisable at the end | $ 16,073,164 |
STOCK OPTIONS AND WARRANTS (D_2
STOCK OPTIONS AND WARRANTS (Details 1) - $ / shares | 3 Months Ended | 12 Months Ended |
Dec. 31, 2021 | Sep. 30, 2021 | |
Exercise price | $ 1.10 | $ 1.04 |
Number of options | 18,638,806 | 17,833,356 |
Weighted average remaining life in years remaining life in years | 8 years 3 months 18 days | |
Options exercisable number of options | 12,175,833 | |
Stock Options Exercise price 0.86 [Member] | ||
Exercise price | $ 0.86 | |
Number of options | 1,148,371 | |
Weighted average remaining life in years remaining life in years | 4 years 7 months 28 days | |
Options exercisable number of options | 1,148,371 | |
Stock Options Exercise price 0.66 [Member] | ||
Exercise price | $ 0.66 | |
Number of options | 4,663,935 | |
Weighted average remaining life in years remaining life in years | 6 years 10 months 2 days | |
Options exercisable number of options | 4,663,935 | |
Stock Options Exercise price 0.89 [Member] | ||
Exercise price | $ 0.89 | |
Number of options | 2,500,000 | |
Weighted average remaining life in years remaining life in years | 8 years 5 months 15 days | |
Options exercisable number of options | 1,714,000 | |
Stock Option Exercise Price 1.1 [Member] | ||
Exercise price | $ 1.10 | |
Number of options | 7,915,299 | |
Weighted average remaining life in years remaining life in years | 8 years 10 months 13 days | |
Options exercisable number of options | 3,669,990 | |
Stock Option Exercise Price 0.57 [Member] | ||
Exercise price | $ 0.57 | |
Number of options | 300,000 | |
Weighted average remaining life in years remaining life in years | 9 years 2 months 1 day | |
Options exercisable number of options | 300,000 | |
Stock Option Exercise Price 2.84 [Member] | ||
Exercise price | $ 2.84 | |
Number of options | 450,000 | |
Weighted average remaining life in years remaining life in years | 9 years 3 months 29 days | |
Options exercisable number of options | 250,000 | |
Stock Option Exercise Price 2.75 [Member] | ||
Exercise price | $ 2.75 | |
Number of options | 600,000 | |
Weighted average remaining life in years remaining life in years | 9 years 4 months 2 days | |
Options exercisable number of options | 116,667 | |
Stock Option Exercise Price 2.35 [Member] | ||
Exercise price | $ 2.35 | |
Number of options | 125,000 | |
Weighted average remaining life in years remaining life in years | 9 years 8 months 19 days | |
Options exercisable number of options | 6,944 | |
Stock Option Exercise Price 2.40 [Member] | ||
Exercise price | $ 2.40 | |
Number of options | 50,000 | |
Weighted average remaining life in years remaining life in years | 9 years 6 months 25 days | |
Stock Option Exercise Price 2.50 [Member] | ||
Exercise price | $ 2.50 | |
Number of options | 50,000 | |
Weighted average remaining life in years remaining life in years | 9 years 7 months 2 days | |
Options exercisable number of options | 50,000 | |
Stock Option Exercise Price 2.30 [Member] | ||
Exercise price | $ 2.30 | |
Number of options | 836,200 | |
Weighted average remaining life in years remaining life in years | 9 years 9 months 7 days | |
Options exercisable number of options | 255,925 |
STOCK OPTIONS AND WARRANTS (D_3
STOCK OPTIONS AND WARRANTS (Details 2) | 3 Months Ended |
Dec. 31, 2021$ / shares | |
Weighted average fair value of options granted | $ 2.03 |
Expected dividends yield | 0.00% |
Forfeiture rate | 0.00% |
Maximum [Member] | |
Expected life | 6 years |
Risk-free interest rate | 1.47% |
Expected volatility | 69.60% |
Minimum [Member] | |
Expected life | 5 years |
Risk-free interest rate | 0.01% |
Expected volatility | 55.80% |
STOCK OPTIONS AND WARRANTS (D_4
STOCK OPTIONS AND WARRANTS (Details 3) - USD ($) | 3 Months Ended | |
Dec. 31, 2021 | Sep. 30, 2021 | |
Exercise price (in dollars per share) | $ 1.63 | $ 1.63 |
Number outstanding | $ 15,464,700 | $ 15,464,700 |
Warrant Exercise price 0.86 [Member] | ||
Exercise price (in dollars per share) | $ 0.86 | |
Number outstanding | $ 3,850,709 | |
Weighted average remaining contractual life (years) | 5 years 4 months 13 days | |
Weighted average exercise price | $ 0.86 | |
Number exercisable | 3,850,709 | |
Weighted average remaining contractual life (years) | 5 years 4 months 13 days | |
Warrant Exercise price 0.38 [Member] | ||
Exercise price (in dollars per share) | $ 0.38 | |
Number outstanding | $ 2,000,000 | |
Weighted average remaining contractual life (years) | 4 years 11 months 4 days | |
Weighted average exercise price | $ 0.38 | |
Number exercisable | 2,000,000 | |
Weighted average remaining contractual life (years) | 4 years 11 months 4 days | |
Warrant Exercise price 0.75 [Member] | ||
Exercise price (in dollars per share) | $ 0.75 | |
Number outstanding | $ 2,666,667 | |
Weighted average remaining contractual life (years) | 8 years 2 months 12 days | |
Weighted average exercise price | $ 0.75 | |
Number exercisable | 2,666,667 | |
Weighted average remaining contractual life (years) | 8 years 2 months 12 days | |
Warrant Exercise price 2.75 [Member] | ||
Exercise price (in dollars per share) | $ 2.75 | |
Number outstanding | $ 323,864 | |
Weighted average remaining contractual life (years) | 11 months 1 day | |
Weighted average exercise price | $ 2.75 | |
Number exercisable | 323,864 | |
Weighted average remaining contractual life (years) | 11 months 1 day | |
Warrant Exercise price 2.80 [Member] | ||
Exercise price (in dollars per share) | $ 2.80 | |
Number outstanding | $ 50,000 | |
Weighted average remaining contractual life (years) | 9 years 3 months 25 days | |
Weighted average exercise price | $ 2.80 | |
Number exercisable | 50,000 | |
Weighted average remaining contractual life (years) | 9 years 3 months 25 days | |
Warrant Exercise price 2.75 [Member] | ||
Exercise price (in dollars per share) | $ 2.75 | |
Number outstanding | $ 6,573,460 | |
Weighted average remaining contractual life (years) | 2 years 9 months | |
Weighted average exercise price | $ 2.75 | |
Number exercisable | 6,573,460 | |
Weighted average remaining contractual life (years) | 2 years 9 months |
STOCK OPTIONS AND WARRANTS (D_5
STOCK OPTIONS AND WARRANTS (Details 4) | Dec. 31, 2021USD ($)$ / shares |
Number of shares | |
Outstanding at beginning | $ | $ 15,464,700 |
Outstanding at ending | $ | $ 15,464,700 |
Weighted average exercise price per share | |
Outstanding at beginning | $ / shares | $ 1.63 |
Outstanding at ending | $ / shares | $ 1.63 |
STOCK OPTIONS AND WARRANTS (D_6
STOCK OPTIONS AND WARRANTS (Details 5) | Dec. 31, 2021$ / shares |
Weighted average fair value of warrants granted | $ 1.15 |
Expected Dividend Yield [Member] | |
Warrants outstanding, measurement input | 0 |
Forfeiture Rate [Member] | |
Warrants outstanding, measurement input | 0 |
Minimum [Member] | |
Warrant term | 1 year 9 months |
Minimum [Member] | Risk Free Interest Rate [Member] | |
Warrants outstanding, measurement input | 0.15 |
Minimum [Member] | Expected Stock Volatility [Member] | |
Warrants outstanding, measurement input | 57.30 |
Maximum [Member] | |
Warrant term | 10 years |
Maximum [Member] | Risk Free Interest Rate [Member] | |
Warrants outstanding, measurement input | 1.58 |
Maximum [Member] | Expected Stock Volatility [Member] | |
Warrants outstanding, measurement input | 58.65 |
STOCK OPTIONS AND WARRANTS (D_7
STOCK OPTIONS AND WARRANTS (Details Narrative) - USD ($) | 3 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2021 | |
Stock-based compensation expense | $ 1,549,406 | $ 316,033 | |
Number of warrants issued | 300,000 | ||
Warrants issued for severance | $ 492,000 | ||
Number of shares issued | 704,000 | ||
Exercise price (in dollars per share) | $ 1.63 | $ 1.63 | |
Senior Secured Convertible Promissory Debentures [Member] | |||
Number of warrants issued | 0 | 68,182 | |
Value of warrants issued | $ 750,000 | ||
Additional debt discount | $ 26,770 | ||
Stock Options [Member] | |||
Stock price (in dollars per share) | $ 2.25 | $ 3.21 | |
Number of options issued | 911,200 | ||
Amount of total compensation cost related to nonvested awards not yet recognized | $ 11,096,347 | ||
Weighted average period over which expense is expected to be recognized | 27 months 12 days | ||
Price per option (in dollars per share) | $ 1.38 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - $ / shares | Dec. 31, 2021 | Sep. 30, 2021 |
Subsequent Events [Abstract] | ||
Exercise price of warrants | $ 1.63 | $ 1.63 |
INCOME TAX (Details Narrative)
INCOME TAX (Details Narrative) - USD ($) | 3 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | ||
Total provision (benefit) | $ 251 | $ 98,244 |
U.S. federal statutory rate | 21.00% | 21.00% |