Cover
Cover - USD ($) | 12 Months Ended | ||
Sep. 30, 2023 | Dec. 15, 2023 | Mar. 31, 2023 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Sep. 30, 2023 | ||
Document Transition Report | false | ||
Entity File Number | 001-41508 | ||
Entity Registrant Name | LOOP MEDIA, INC. | ||
Entity Incorporation, State Code | NV | ||
Entity Tax Identification Number | 47-3975872 | ||
Entity Address, Address Line One | 2600 West Olive Avenue, Suite 5470 | ||
Entity Address, City or Town | Burbank | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 91505 | ||
City Area Code | 213 | ||
Local Phone Number | 436-2100 | ||
Title of 12(g) Security | Common stock, $0.0001 par value | ||
Trading Symbol | LPTV | ||
Security Exchange Name | NYSE | ||
Entity Well-known Season Issuer | No | ||
Entity Voluntary Filers | No | ||
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 | ||
ICFR Auditor Attestation Flag | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 245,468,455 | ||
Entity Common Stock, Shares Outstanding | 70,691,228 | ||
Auditor Name | Marcum LLP | ||
Auditor Firm ID | 688 | ||
Auditor Location | Costa Mesa, California | ||
Entity Central Index Key | 0001643988 | ||
Current Fiscal Year End Date | --09-30 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2023 | ||
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
Current assets | ||
Cash | $ 3,068,696 | $ 14,071,914 |
Accounts receivable, net | 6,211,815 | 12,590,970 |
Prepaid expenses and other current assets | 987,605 | 1,496,566 |
Content assets - current | 2,218,894 | 745,633 |
Total current assets | 12,487,010 | 28,905,083 |
Non-current assets | ||
Deposits | 12,054 | 63,889 |
Content assets - non current | 448,726 | 678,659 |
Deferred costs - non current | 744,408 | |
Property and equipment, net | 2,711,558 | 1,633,169 |
Operating lease right-of-use assets | 76,696 | |
Intangible assets, net | 477,889 | 590,333 |
Total non-current assets | 4,394,635 | 3,042,746 |
Total assets | 16,881,645 | 31,947,829 |
Current liabilities | ||
Accounts payable | 4,978,920 | 7,453,801 |
Accrued liabilities | 3,546,338 | 5,620,873 |
Accrued royalties and revenue share | 4,930,329 | 4,559,088 |
Payable on acquisition | 250,125 | |
License content liabilities - current | 489,157 | 1,092,819 |
Deferred Income | 140,764 | |
Lease liability - current | 75,529 | |
Total current liabilities | 19,054,762 | 19,192,999 |
Non-current liabilities | ||
License content liability - non current | 208,000 | |
Total non-current liabilities | 2,643,216 | 7,100,738 |
Total liabilities | 21,697,978 | 26,293,737 |
Commitments and contingencies (Note 9) | ||
Stockholders' equity (deficit) | ||
Common Stock, $0.0001 par value, 150,000,000 shares authorized, 65,620,151 and 56,381,209 shares issued and outstanding as of September 30, 2023 and September 30, 2022, respectively | 6,562 | 5,638 |
Additional paid in capital | 123,462,648 | 101,970,318 |
Accumulated deficit | (128,285,543) | (96,321,864) |
Total stockholders' equity (deficit) | (4,816,333) | 5,654,092 |
Total liabilities and stockholders' equity (deficit) | 16,881,645 | 31,947,829 |
Non-revolving line of credit | ||
Current liabilities | ||
Revolving line of credit, current | 2,124,720 | |
Non-current liabilities | ||
Line of credit, noncurrent | 475,523 | 1,494,469 |
Revolving line of credit | ||
Current liabilities | ||
Revolving line of credit, current | 2,985,298 | |
Non-current liabilities | ||
Line of credit, noncurrent | 3,030,516 | |
Related party | ||
Non-current liabilities | ||
Line of credit, noncurrent | $ 1,959,693 | $ 2,575,753 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2023 | Aug. 15, 2023 | Sep. 30, 2022 |
CONDENSED CONSOLIDATED BALANCE SHEETS | |||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Common stock, authorized | 150,000,000 | 150,000,000 | |
Common stock, issued | 65,620,151 | 56,381,209 | |
Common stock, outstanding | 65,620,151 | 56,381,209 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Revenue | $ 31,642,293 | $ 30,832,796 |
Cost of revenue | 20,982,933 | 19,450,398 |
Gross profit | 10,659,360 | 11,382,398 |
Operating expenses | ||
Sales, general and administrative | 29,427,139 | 24,481,603 |
Stock-based compensation | 7,997,849 | 9,355,342 |
Depreciation and amortization | 1,068,999 | 342,105 |
Restructuring costs | 950,985 | |
Impairment of goodwill and intangible assets | 1,970,321 | |
Total operating expenses | 39,444,972 | 36,149,371 |
Loss from operations | (28,785,612) | (24,766,973) |
Other income (expense) | ||
Interest income | 200 | |
Interest expense | (3,802,346) | (3,620,212) |
Loss on extinguishment of debt | (2,097,833) | |
Gain on extinguishment of debt | 490,051 | |
Change in fair value of derivatives | 514,643 | |
Employee retention credits | 645,919 | |
Other expense | (3,128) | |
Total other income (expense) | (3,159,555) | (4,713,151) |
Loss before income taxes | (31,945,167) | (29,480,124) |
Income tax (expense)/benefit | (18,512) | 676 |
Net loss | $ (31,963,679) | $ (29,479,448) |
Basic net loss per common share (in dollars per share) | $ (0.56) | $ (0.61) |
Diluted net loss per common share (in dollars per share) | $ (0.56) | $ (0.61) |
Weighted average number of basic common shares outstanding (in shares) | 57,502,870 | 48,167,932 |
Weighted average number of diluted common shares outstanding (in shares) | 57,502,870 | 48,167,932 |
Advertising and Legacy and other revenue | ||
Cost of revenue | $ 18,036,529 | $ 18,200,045 |
Depreciation and amortization | ||
Cost of revenue | $ 2,946,404 | $ 1,250,353 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) | Common Stock | Preferred Stock Series B preferred stock | Additional Paid in Capital. | Accumulated Deficit | Total |
Balance at beginning at Sep. 30, 2021 | $ 4,449 | $ 20 | $ 69,833,650 | $ (66,842,416) | $ 2,995,703 |
Balance at beginning (in shares) at Sep. 30, 2021 | 44,490,003 | 200,000 | |||
Increase (Decrease) in Stockholders' Equity | |||||
Conversion of convertible debenture | $ 199 | 5,313,153 | 5,313,352 | ||
Conversion of convertible debenture (in shares) | 1,988,266 | ||||
Stock-based compensation | 8,988,681 | 8,988,681 | |||
Warrants issued in conjunction with debt | 4,322,984 | 4,322,984 | |||
Shares issued for cash | $ 240 | 10,888,925 | 10,889,165 | ||
Shares issued for cash (in shares) | 2,400,000 | ||||
Payment in kind interest stock issuance | $ 2 | 176,998 | 177,000 | ||
Payment in kind interest stock issuance (in shares) | 23,151 | ||||
Warrants issued for consulting fees | 366,661 | 366,661 | |||
Beneficial conversion feature of convertible debenture | 2,079,993 | 2,079,993 | |||
Conversion of series convertible preferred to common stock | $ 667 | $ (20) | (647) | ||
Conversion of series convertible preferred to common stock (in shares) | 6,666,666 | (200,000) | |||
Cashless exercise of warrants | $ 57 | (57) | |||
Cashless exercise of warrants (in shares) | 578,847 | ||||
Shares issued as part of uplist allotment | $ 23 | (23) | |||
Shares issued as part of uplist allotment (in shares) | 232,700 | ||||
Adjustment for fractional shares | $ 1 | 1 | |||
Adjustment for fractional shares (in shares) | 1,576 | ||||
Net loss | (29,479,448) | (29,479,448) | |||
Balance at ending (in shares) at Sep. 30, 2022 | 56,381,209 | ||||
Balance at ending at Sep. 30, 2022 | $ 5,638 | 101,970,318 | (96,321,864) | 5,654,092 | |
Increase (Decrease) in Stockholders' Equity | |||||
Shares issued upon exercise of options | $ 4 | 64,057 | $ 64,061 | ||
Shares issued upon exercise of options (in shares) | 37,462 | 37,462 | |||
Stock-based compensation | 8,594,779 | $ 8,594,779 | |||
Short Swing Profit Recovery | 1,201 | 1,201 | |||
Issuance costs from uplist of stock | (86,330) | (86,330) | |||
Warrants issued in conjunction with debt | 447,897 | 447,897 | |||
Shares issued for vested RSUs | $ 8 | 8 | |||
Shares issued for vested RSUs (in shares) | 79,393 | ||||
Payment in kind interest stock issuance | 177,000 | ||||
Payment in kind interest stock issuance (in shares) | 23,151 | ||||
Shares issued for cash under ATM, net | $ 311 | 8,619,292 | 8,619,603 | ||
Shares issued for cash under ATM, net (in shares) | 3,109,843 | ||||
Shares issued for capital raise costs | $ 1 | 4,999 | 5,000 | ||
Shares issued for capital raise costs (in shares) | 6,757 | ||||
Shares issued for debt | $ 600 | 3,846,435 | 3,847,035 | ||
Shares issued for debt (in shares) | 6,005,487 | ||||
Net loss | (31,963,679) | (31,963,679) | |||
Balance at ending (in shares) at Sep. 30, 2023 | 65,620,151 | ||||
Balance at ending at Sep. 30, 2023 | $ 6,562 | $ 123,462,648 | $ (128,285,543) | $ (4,816,333) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net loss | $ (31,963,679) | $ (29,479,448) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Amortization of debt discount | 6,721,476 | 2,691,617 |
Depreciation and amortization expense | 1,068,999 | 342,105 |
Amortization of content assets | 2,946,403 | 1,250,353 |
Amortization of right-of-use assets | 76,696 | 160,398 |
Bad debt expense | 630,629 | 441,223 |
Gain on extinguishment of debt | (490,051) | |
Loss on early extinguishment of convertible debt | 2,097,833 | |
Change in fair value of derivative | (514,643) | |
Stock-based compensation | 7,997,849 | 9,355,342 |
Stock option exercise | 596,938 | |
Payment in kind for interest stock issuance | 177,000 | |
Impairment of Intangible Assets (Excluding Goodwill) | 1,970,321 | |
Change in operating assets and liabilities: | ||
Accounts receivable | 5,748,526 | (11,460,966) |
Prepaid income tax | (3,569) | |
Inventory | 3,593 | 205,379 |
Prepaid expenses | 505,370 | (1,062,487) |
Deposit | 51,835 | (29,600) |
Accounts payable | (2,474,881) | 5,611,133 |
Accrued liabilities | (2,074,535) | 5,445,805 |
Accrued royalties and revenue share | 371,241 | 3,925,625 |
Licensed content liability | (4,585,393) | (1,160,000) |
Operating lease liabilities | (75,529) | (167,101) |
Deferred income taxes | (140,764) | (50,567) |
NET CASH USED IN OPERATING ACTIVITIES | (14,595,226) | (10,744,298) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchase of property and equipment | (1,969,447) | (1,823,893) |
Capitalized internally-developed content | 191,204 | |
NET CASH USED IN INVESTING ACTIVITIES | (1,969,447) | (2,015,097) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from issuance of common stock | 8,724,855 | 1,250,000 |
Proceeds from issuance of convertible debt | 2,079,993 | |
Proceeds from non-revolving line of credit | 10,766,546 | |
Proceeds from line of credit | 46,237,319 | |
Proceeds from exercise of stock options | 64,061 | |
Common stock issuance cost | (105,252) | |
Deferred costs | (809,905) | |
Payment of acquisition related consideration | (250,128) | |
Repayments on lines of credit | (47,906,217) | |
Debt issuance costs | (313,149) | (87,646) |
Shares issued for capital raise costs | 5,000 | |
Proceeds from public offering, net of underwriting discount | 12,060,933 | |
Public offering issuance cost | (86,330) | (685,481) |
Repayment of convertible debt | (2,715,583) | |
Short swing profit recovery | 1,201 | |
NET CASH PROVIDED BY FINANCING ACTIVITIES | 5,561,455 | 22,668,761 |
Change in cash and cash equivalents | (11,003,218) | 9,909,366 |
Cash, beginning of period | 14,071,914 | 4,162,548 |
Cash, end of period | 3,068,696 | 14,071,914 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW STATEMENTS | ||
Cash paid for interest | 1,536,370 | 194,591 |
Cash paid for income taxes | 1,051 | |
SUPPLEMENTAL DISCLOSURES OF NON CASH INVESTING AND FINANCING ACTIVITIES | ||
Conversion of convertible debenture to common stock | 5,313,352 | |
Beneficial conversion feature recorded as discounted debt | 2,097,833 | |
Payment in kind common stock payment | 265,749 | 177,000 |
Warrants issued in conjunction with debt | 447,897 | 4,322,984 |
Conversion of Preferred Class A stock to common stock | 667 | |
Unpaid offering costs | 129,667 | 486,286 |
Unpaid debt issuance costs | $ 215,224 | |
Unpaid additions to property and equipment | 319,696 | |
Shares issued for cash under ATM, net | $ 8,619,603 |
BUSINESS
BUSINESS | 12 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BUSINESS | NOTE 1 – BUSINESS Loop Media, Inc., a Nevada corporation, (collectively, “Loop Media,” the “Company,” “we,” “us” or “our”) is a multichannel digital video platform media company that uses marketing technology, or “MarTech,” to generate our revenue and offer our services. Our technology and vast library of videos and licensed content enable us to curate and distribute short-form videos to out-of-home (“OOH”) dining, hospitality, retail, convenience stores and other locations and venues to enable them to inform, entertain and engage their customers. Our technology provides third-party advertisers with a targeted marketing and promotional tool for their products and services and, in certain instances, allows us to measure the number of potential viewers of such advertising and promotional materials. We also allow our OOH clients to access our service without advertisements by paying a monthly subscription fee. We offer hand-curated music video content licensed from major and independent record labels, including Universal Music Group (“Universal”), Sony Music Entertainment (“Sony”), and Warner Music Group (“Warner” and collectively with Universal and Sony, the “Music Labels”), as well as non-music video content, which is predominantly licensed or acquired from third parties, including action sports clips, drone and atmospheric footage, trivia, news headlines, lifestyle channels and kid-friendly videos, as well as movie, television and video game trailers, amongst other content. We distribute our content and advertising inventory to digital screens located in OOH locations primarily through (i) our owned and operated platform (the “O&O Platform”) of Loop Media-designed “small-box” streaming Android media players (“Loop Players”) and legacy ScreenPlay computers and (ii) through screens (“Partner Screens”) on digital platforms owned and operated by third parties (each a “Partner Platform” and collectively, the “Partner Platforms,” and together with the O&O Platform, the “Loop Platform”). Liquidity and management’s Plan As shown in the accompanying consolidated financial statements, we have incurred significant recurring losses resulting in an accumulated deficit. We anticipate further losses in the foreseeable future. We also had negative cash flows used in operations. These factors raise substantial doubt about our ability to continue as a going concern. On December 22, 2022, we filed a Shelf Registration Statement on Form S-3 that has been declared effective by the Securities and Exchange Commission (“SEC”). On May 12, 2023, we entered into an At The Market (“ATM”) Issuance Sales Agreement (the “Sales Agreement”) with B. Riley Securities, Inc. (the “Agent”) pursuant to which we may offer and sell, from time to time through the Agent, shares of our common stock, par value $0.0001 per share, for aggregate gross proceeds of up to $50,000,000 . During the twelve months ended September 30, 2023, we issued 3,109,843 shares of our common stock under the Sales Agreement, resulting in cash proceeds of $8,724,544 , net of placement agent’s commission and related fees of $269,600 but before deducting issuance costs of $105,253 . We have not raised any funds through sales under our ATM Sales Agreement from October 1, 2023, through the date of this Report. Based on the available cash balance at September 30, 2023, and these new sources of funding, we believe that we will have sufficient resources to fund our operations for at least twelve months from the date these financial statements were issued and that the substantial doubt in connection with our ability to continue as a going concern is alleviated. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of presentation The consolidated financial statements include our accounts and our wholly-owned subsidiary, EON Media Group Pte. Ltd. (“EON Media”) and Retail Media TV, Inc. These consolidated financial statements are prepared using the accrual basis of accounting in accordance with accounting principles generally accepted in the United States (“GAAP”). All inter-company transactions and balances have been eliminated on consolidation. Use of estimates The preparation of the financial statements in conformity with generally accepted accounting principles 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 revenue recognition of performance obligations, allowance for doubtful accounts, fair value of stock-based compensation awards, income taxes and going concern. Segment reporting We report as one reportable 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 losses on such accounts. On September 30, 2023, and 2022, we had no cash equivalents. As of September 30, 2023, and 2022, approximately $2,818,696 and $13,821,914 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 judgement and includes the review of individual receivables based on individual customers, current economic trends and analysis of historical bad debts. As of September 30, 2023, and 2022, we had recorded an allowance for doubtful accounts of $630,629 and $646,013, respectively. Concentration of credit risk During the twelve-months ended September 30, 2023, we had two customers which each individually comprised greater than 10% of net revenue. These customers represented 14%, and 12% of net revenue, respectively. No other customer accounted for more than 10% of net revenue during the periods presented. During the twelve-months ended September 30, 2022, we had two customers which each individually comprised greater than 10% of net revenue. These customers represented 15%, and 11% of net revenue, respectively. No other customer accounted for more than 10% of net revenue during the periods presented. As of September 30, 2023, one customer accounted for a total of 18% of our accounts receivable balance. No other customer accounted for more than 10% of total accounts receivable. As of September 30, 2022, three customers accounted for a total of 49% of our accounts receivable balance or 21%, 17%, and 11%, respectively. No other customer accounted for more than 10% of total accounts receivable. We grant credit in the normal course of business to our customers. Periodically, we review past due accounts and make 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. Prepaid expenses Expenditures paid in one accounting period which will not be consumed until a future period such as insurance premiums and annual subscription fees are accounted for on the balance sheet as a prepaid expense. When the asset is eventually consumed, it is charged to expense. Content Asset We capitalize the fixed content fees and corresponding liability when the license period begins, the cost of the content is known, and the content is accepted and available for streaming. If the licensing fee is not determinable or reasonably estimable, no asset or liability is recorded, and licensing costs are expensed as incurred. We amortize licensed content assets into cost of revenue, using the straight-line method over the contractual period of availability. The liability is paid in accordance with the contractual terms of the arrangement. Internally-developed content costs are capitalized in the same manner as licensed content costs, when the cost of the content is known and the content is ready and available for streaming. We amortize internally-developed content assets into cost of revenue, using the straight-line method over the estimated period of streaming. Long-lived assets We evaluate the recoverability of long-lived assets, including intangible assets, for impairment when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Conditions that would necessitate an impairment assessment include a significant decline in the observable market value of an asset, a significant change in the extent or manner that an asset is used, or a significant adverse change that would indicate that the carrying amount of an asset or group of assets is not recoverable. For long-lived assets to be held and used, we recognize an impairment loss only if their carrying amount is not recoverable through the undiscounted cash flows. The impairment loss is based on the difference between the carrying amount and estimated fair value as determined by discounted future cash flows. Our finite long-lived intangible assets are amortized on a straight-line basis over their estimated useful lives, which range from two Property and equipment, net Property and equipment are stated at cost, less accumulated depreciation. Depreciation is calculated using the straight-line method over the asset’s estimated useful life. Our capitalization policy is to capitalize property and equipment purchases greater than $3,000, as well as internally-developed software enhancements. Expenditures for maintenance and repairs are expensed as incurred. When retired or otherwise disposed, the related carrying value and accumulated depreciation are removed from the respective accounts and the net difference less any amount realized from disposition is reflected in earnings. Loop Players are capitalized as fixed assets and depreciated over the estimated period of use. See below for estimated useful lives: Loop Players 3 years Equipment 3 Software 3 years 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 our 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 our 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 twelve months, we have elected the short-term lease measurement and recognition exemption, and we 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 a nonrecurring basis as required by US GAAP. Assets recognized or disclosed at fair value in the condensed consolidated financial statements on a nonrecurring basis include items such as property and equipment, operating lease assets, goodwill, and other intangible assets, which are measured at fair value if determined to be impaired. On September 26, 2022, our convertible debentures converted to Common Stock as part of our public offering and uplist to The NYSE American, LLC, in accordance with the terms of the original debt agreements. As of September 30, 2022, the remaining balance of the Derivative Liability was written off as part of the conversion to equity. Thus, there is no fair value measurement of the Derivative Liability balance as of September 30, 2023. Advertising costs We expense all advertising costs as incurred. Advertising and marketing costs for the twelve months ended September 30, 2023, and 2022, were $11,149,084 and $7,255,962, respectively. Revenue recognition We recognize revenue in accordance with ASC 606, Revenue from Contracts with Customers, when it satisfies a performance obligation by transferring control over a product to a customer. Revenue is measured based on the consideration we expect to receive in exchange for those products. In instances where final acceptance of the product is specified by the client, revenue is deferred until all acceptance criteria have been met. For example, we bill subscription services in advance of when the service is performed and revenue is treated as deferred revenue until the service is performed and/or the performance obligation is satisfied. Revenues are recognized under Topic 606 in a manner that reasonably reflects the delivery of our products and services to clients in return for expected consideration and includes the following elements: ● executed contracts with our customers that we believe 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. Our revenue can be categorized into two revenue streams: Advertising revenue and Legacy and other revenue. The following table disaggregates our revenue by major type for each of the periods indicated: Twelve months ended September 30, 2023 2022 Advertising revenue $ 28,740,623 $ 26,060,885 Legacy and other revenue 2,901,670 4,771,911 Total $ 31,642,293 $ 30,832,796 Performance obligations and significant judgments Our performance obligations and recognition patterns for each revenue stream are as follows: Advertising revenue For the twelve months ended September 30, 2023, advertising revenue accounts for 91% of our revenue and includes revenue from direct and programmatic advertising as well as sponsorships. For all advertising revenue sources, we evaluate whether we should be considered the principal (i.e., report revenues on a gross basis) or an agent (i.e., report revenues on a net basis). Our role as principal or agent differs based on our performance obligation for each revenue share arrangement. For both the O&O and Partner Platforms businesses, advertising inventory provided to advertisers through the use of an advertising demand partner or agency, with whose fees or commission is calculated based on a stated percentage of gross advertising spending, we are considered the agent and our revenues are reported net of agency fees and commissions. We are considered the agent because the demand partner or agency controls all aspects of the transaction (pricing risk, inventory risk, obligation for fulfillment) except for the devices used to show the advertisements, therefore we report this advertising revenue net of agency fees and commissions. We are considered the principal in our arrangements with content providers in our O&O Platform business and with our arrangements with our third-party partners in our Partner Platforms business and thus report revenues on a gross basis (net of agency fees and commissions), wherein the amounts billed to our advertising demand partners, advertising agencies, and direct advertisers and sponsors are recorded as revenues, and amounts paid to content providers and third-party partners are recorded as expenses. We are considered the principal because we control the advertising space, are primarily responsible to our advertising demand partners and other parties filling our advertising inventory, have discretion in pricing and advertising fill rates and typically have an inventory risk. For advertising revenue, we recognize revenue at the time the digital advertising impressions are filled and the advertisements are played and, for sponsorship revenue, we generally recognize revenue ratably over the term of the sponsorship arrangement as the sponsored advertisements are played. Legacy and other business revenue For the twelve months ended September 30, 2023, legacy and other business revenue accounts for the remaining 9% of total revenue and includes streaming services, subscription content services, and hardware delivery, as described below: o Delivery of streaming services including content encoding and hosting. We recognize revenue over the term of the service based on bandwidth usage. Revenue from streaming services is insignificant. o Delivery of subscription content services in customized formats. We recognize revenue straight-line 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. Revenue from hardware sales is insignificant. 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 Customer acquisition costs consist of marketing costs and affiliate fees associated with the O&O Platform business. They are included in operating expenses and expensed as incurred. Cost of revenue Cost of revenue for the O&O Platform and legacy businesses represents the amortized cost of ongoing licensing and hosting fees, which is recognized over time based on usage patterns. The depreciation expense associated with the Loop Players is not included in cost of sales. Cost of revenue for the Partner Platforms business represents hosting fees, amortized costs of internally-developed content, and the revenue share with third party partners (after deduction of allocated infrastructure costs). The cost of revenue is higher with partners within the Partner Platforms versus those within the O&O Platform because we leverage our Partner Platforms partners’ network of customers and their screens to deliver content and advertising inventory, rather than using our own Loop Players. Deferred income As of September 30, 2023, we no longer bill subscription services in advance of when the service period is performed. The deferred income recorded at September 30, 2022, 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 (“ASC 260-10”), which requires presentation of basic and diluted earnings per share (“EPS”) on the face of the statement of operations for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation to the numerator and denominator of the diluted EPS. 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 September 30, 2023, and 2022, respectively, because their inclusion would have been anti-dilutive. September 30, 2023 2022 Options to purchase common stock 8,849,305 8,174,583 Warrants to purchase common stock 5,592,573 5,300,033 Restricted Stock Units (RSUs) 1,156,397 890,000 Series A preferred stock — — Series B preferred stock — — Convertible debentures — — Total common stock equivalents 15,598,275 14,364,616 Shipping and handling costs Loop Players are provided as part of the charge for service to our customers. Loop Media absorbs any associated costs of shipping and handling and records as an operational expense at the time of service. Income taxes We account for income taxes in accordance with ASC Topic 740, Income Taxes (“ASC 740”). ASC 740 requires a company to use the asset and liability method of accounting for income taxes, whereby deferred tax assets are recognized for deductible temporary differences, and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion, or all of, the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effect of changes in tax laws and rates on the date of enactment. Under ASC 740, a tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. We have no material uncertain tax positions for any of the reporting periods presented. We recognize accrued interest and penalties related to unrecognized tax benefits as part of income tax expense. We have also made a policy election to treat the income tax with respect to global intangible low-tax income as a period expense when incurred. In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2019-12, Simplifying the Accounting for Income Taxes, as part of its initiative to reduce complexity in accounting standards. The amendments in the ASU are effective for fiscal years beginning after December 15, 2020, including interim periods therein. The adoption of this standard in the first quarter of 2022 had no impact on our consolidated financial statements. Stock-based compensation Stock-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 stock-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. Deferred costs Deferred costs represent legal, accounting and other direct costs related to our efforts to raise capital through a public or private sale of our Common Stock. Costs related to the public sale of our Common Stock are deferred until the completion of the applicable offering, at which time such costs are reclassified to additional paid-in-capital as a reduction of the proceeds. Costs related to the private sale of our Common Stock are deferred until the completion of the applicable offering, at which time such costs are amortized over the term of the applicable purchase agreement. Employee retention credits In March 2020, the Coronavirus Aid, Relief, and Economic Security Act was signed into law, providing numerous tax provisions and other stimulus measures, including the Employee Retention Credit (“ERC”): a refundable tax credit against certain employment taxes. The Taxpayer Certainty and Disaster Tax Relief Act of 2020 and the American Rescue Plan Act of 2021 extended and expanded the availability of the ERC. We qualified for the ERC in the third and fourth quarters of 2020 and the first, second and third quarters of 2021. During the twelve months ended September 30, 2023, we recorded an aggregate benefit of $645,919 in our condensed combined income statement to reflect the ERC. Reclassifications Certain prior year amounts have been reclassified to conform to current year presentation. These reclassifications have no effect on the previously reported financial position, results of operations, or cash flows. Previously reported accounts payable and accrued liabilities have now been disaggregated into accounts payable, accrued liabilities, and accrued royalty. Further, stock-based compensation and depreciation and amortization expenses have now been segregated from sales, general and administrative expenses and separately reported within operating expenses. Restructuring costs We undertook initiatives to increase efficiency and cut costs, while still maintaining our focus on, and dedication to, the continued growth of our business. During the twelve months ended September 30, 2023, we made cuts and adjustments across several aspects of our business. We completed a plan to reduce our overall SG&A costs by approximately 20% , including labor and various other operating costs. Part of this reduction included eliminating some non-revenue generating headcount, while continuing to invest in expansion of our revenue and ad sales team. Our restructuring costs for the year ended September 30, 2023, were $950,986 compared to $0 for the year ended September 30, 2022, primarily due to the reduction of headcount and the integration of Loop Media Studios division into other areas of our business. Recently adopted accounting pronouncements In August 2020, the FASB issued ASU 2020-06, Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40). This ASU reduces the number of accounting models for convertible debt instruments and convertible preferred stock as well as amend the guidance for the derivatives scope exception for contracts in an entity’s own equity to reduce form-over-substance-based accounting conclusions. In addition, this ASU improves and amends the related EPS guidance. The ASU is effective for interim and annual periods beginning after December 15, 2021, with early adoption permitted for periods beginning after December 15, 2020. Adoption of the ASU can either be on a modified retrospective or full retrospective basis. We adopted this ASU as of October 1, 2022, and there is no material impact to our financial statements. Recent accounting pronouncements In September 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This guidance requires the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions and reasonable and supportable forecasts. This guidance also requires enhanced disclosures regarding significant estimates and judgments used in estimating credit losses. The new guidance is effective for fiscal years beginning after December 15, 2022. We are currently evaluating the impact of this standard on our condensed consolidated financial statements and related disclosures. In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, that would enhance disclosures for significant segment expenses for all public entities required to report segment information in accordance with ASC 280. ASC 280 requires a public entity to report for each reportable segment a measure of segment profit or loss that its chief operating decision maker (“CODM”) uses to assess segment performance and to make decisions about resource allocations. The amendments in ASU 2023-07 improve financial reporting by requiring disclosure of incremental segment information on an annual and interim basis for all public entities to enable investors to develop more useful financial analyses. Currently, Topic 280 requires that a public entity disclose certain information about its reportable segments. For example, a public entity is required to report a measure of segment profit or loss that the CODM uses to assess segment performance and make decisions about allocating resources. ASC 280 also requires other specified segment items and amounts such as depreciation, amortization and depletion expense to be disclosed under certain circumstances. The amendments in ASU 2023-07 do not change or remove those disclosure requirements. The amendments in ASU 2023-07 also do not change how a public entity identifies its operating segments, aggregates those operating segments, or applies the quantitative thresholds to determine its reportable segments. The amendments in ASU 2023-07 are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. A public entity should apply the amendments in ASU 2023-07 retrospectively to all prior periods presented in the financial statements. We are currently evaluating the impact of this standard on our condensed consolidated financial statements and related disclosures. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 is intended to enhance the transparency and decision usefulness of income tax disclosures. The amendments in ASU 2023-09 address investor requests for enhanced income tax information primarily through changes to the rate reconciliation and income taxes paid information. ASU 2023-09 will be effective for us in the annual period beginning October 1, 2025, though early adoption is permitted. We are still evaluating the presentational effect that ASU 2023-09 will have on our consolidated financial statements, but we expect considerable changes to our income tax footnote. |
CONTENT ASSETS
CONTENT ASSETS | 12 Months Ended |
Sep. 30, 2023 | |
Content Assets [Abstract] | |
CONTENT ASSETS | NOTE 3 –CONTENT ASSETS Content Assets The content we stream to our users is generally acquired by securing the intellectual property rights to the content through licenses from, and paying royalties or other consideration to, rights holders or their agents. The licensing can be for a fixed fee or can be a revenue sharing arrangement. The licensing arrangements specify the period when the content is available for streaming, the territories, the platforms, the fee structure and other standard content licensing terms defining the rights and/or restrictions for how the licensed content can be used by Loop Media. We also develop original content internally, which is capitalized when the content is ready and available for streaming, and generally amortized over a period of two to three years . As of September 30, 2023, content assets were $2,218,894 recorded as Content asset, net – current and $448,726 recorded as Content asset, net – noncurrent, of which $140,862 was internally-developed content asset, net. We recorded amortization expense in cost of revenue, in the consolidated statements of operations, related to capitalized content assets: September 30, 2023 2022 Licensed Content Assets $ 2,882,106 $ 1,236,933 Internally-Developed Assets 64,297 13,420 Total $ 2,946,403 $ 1,250,353 Our content license contracts are typically two three years Fiscal Year 2024 Fiscal Year 2025 Fiscal Year 2026 Licensed Content Assets $ 2,218,894 $ 210,463 $ 97,402 Internally-Developed Assets 72,860 59,440 8,563 Total $ 2,291,754 $ 269,903 $ 105,965 License Content Liabilities On September 30, 2023, we had $926,656 of obligations comprised of $489,157 in license content liability – current, $208,000 in license content liability - noncurrent and $229,499 in accounts payable on our Consolidated Balance Sheets. Payments for content liabilities for the twelve months ended September 30, 2023, were $4,508,517. The expected timing of payments for these content obligations is $399,157 payable in fiscal year 2024, $98,000 payable in fiscal year 2025 and $110,000 payable in fiscal year 2026. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended |
Sep. 30, 2023 | |
PROPERTY AND EQUIPMENT | |
PROPERTY AND EQUIPMENT | NOTE 4. PROPERTY AND EQUIPMENT Our property and equipment, net consisted of the following as of September 30, 2023, and 2022: September 30, 2023 2022 Loop Players $ 2,536,937 $ 1,259,402 Equipment 801,301 703,341 Software 854,966 404,058 4,193,204 2,366,801 Less: accumulated depreciation (1,481,646) (733,632) Total property and equipment, net $ 2,711,558 $ 1,633,169 For the twelve months ended September 30, 2023, and 2022, depreciation expense, calculated using straight line method, charged to operations amounted to $891,058 and $229,661 , respectively. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 12 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS incl goodwill | NOTE 5. INTANGIBLE ASSETS Our other intangible assets, each definite lived assets, consisted of the following as of September 30, 2023, and 2022: September 30, Useful life 2023 2022 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 (732,111) (619,667) Total (732,111) (619,667) Total intangible assets, net $ 477,889 $ 590,333 Amortization expense charged to operations amounted to $112,444 and $112,444, respectively, for the twelve months ended September 30, 2023, and 2022. Annual amortization expense for the next five years and thereafter is estimated to be $112,444, $112,444, $112,444, $112,444, and $28,113, respectively. The weighted average life of the intangible assets subject to amortization is 4.2 years on September 30, 2023. |
OPERATING LEASES
OPERATING LEASES | 12 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
OPERATING LEASES | NOTE 6 – OPERATING LEASES Operating leases As of September 30, 2023, we no longer have operating leases for office space and office equipment in excess of one year. Many of our prior leases included one Our lease liability consisted of the following as of September 30, 2023: September 30, 2023 2022 Short term portion $ — $ 75,529 Long term portion — — Total lease liability $ — $ 75,529 We recorded lease expense in sales, general and administration expenses in the consolidated statement of operations: Twelve months ended September 30, 2023 2022 Operating lease expense $ 79,434 $ 177,776 Short-term lease expense 113,590 9,000 Total lease expense $ 193,024 $ 186,776 For the twelve months ended September 30, 2023, cash payments against lease liabilities totaled $77,929 and accretion on lease liability of $2,737. For the twelve months ended September 30, 2022, cash payments against lease liabilities totaled $184,480 and accretion on lease liability of $17,379. |
ACCOUNTS PAYABLE AND ACCRUED EX
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | 12 Months Ended |
Sep. 30, 2023 | |
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 September 30, 2023, and 2022: September 30, 2023 2022 Accounts payable $ 4,978,920 $ 7,453,801 Performance bonuses 1,262,000 2,970,000 Interest payable 175,094 348,150 Professional fees 449,944 505,169 Marketing 800,165 344,309 Commissions — 425,321 Insurance liabilities 552,000 602,970 Other accrued liabilities 307,135 424,954 Accrued liabilities 3,546,338 5,620,873 Accrued royalties and revenue share 4,930,329 4,559,088 Total accounts payable and accrued expenses $ 13,455,587 $ 17,633,762 |
DEBT
DEBT | 12 Months Ended |
Sep. 30, 2023 | |
Debt Instruments [Abstract] | |
DEBT | NOTE 8 – DEBT Lines of Credit as of September 30, 2023: Unpaid Contractual Net Carrying Value Principal Interest Rates Contractual Warrants Related party lines of credit: Current Long Term Balance Cash Maturity Date issued $4,000,000 non-revolving line of credit, May 10, 2023 $ — $ 1,959,693 $ 2,266,733 12% 5/10/2025 209,398 Total related party lines of credit, net $ — $ 1,959,693 $ 2,266,733 Lines of credit: $2,200,000 non-revolving line of credit, May 13, 2022 $ 2,124,720 $ — $ 2,200,000 12% 11/13/2023 314,286 $6,000,000 revolving line of credit, July 29, 2022 2,985,298 — 3,730,914 Greater of 4% or Prime 7/29/2024 — $4,000,000 non-revolving line of credit, May 10, 2023 — 475,523 900,000 12% 5/10/2025 83,142 Total lines of credit, net $ 5,110,018 $ 475,523 $ 6,830,914 Lines of Credit as of September 30, 2022: Unpaid Contractual Net Carrying Value Principal Interest Rates Contractual Warrants Related party lines of credit: Current Long Term Balance Cash Maturity Date issued $4,022,986 non-revolving line of credit, April 25, 2022 $ — $ 2,575,753 $ 4,022,986 12% 10/25/2023 383,141 Total related party lines of credit, net $ — $ 2,575,753 $ 4,022,986 Lines of credit: $2,200,000 non-revolving line of credit, May 13, 2022 $ — $ 1,494,469 $ 2,200,000 12% 11/13/2023 314,286 $6,000,000 revolving line of credit, July 29, 2022 — 3,030,516 4,543,560 Greater of 4% or Prime 7/29/2024 — Total lines of credit, net $ — $ 4,524,985 $ 6,743,560 The following table presents the interest expense related to the contractual interest coupon and the amortization of debt discounts on the convertible debentures: Twelve months ended September 30, 2023 2022 Interest expense $ 1,363,314 $ 919,372 Amortization of debt discounts 2,426,544 2,691,617 Total $ 3,789,858 $ 3,610,989 Maturity analysis under the line of credit agreements for the fiscal years ended September 30, 2024 $ 5,930,914 2025 3,166,733 2026 — 2027 — 2028 — Lines of credit, related and non-related party 9,097,647 Less: Debt discount on lines of credit payable (1,552,413) Total Lines of credit payable, related and non-related party, net $ 7,545,234 Revolving Lines of Credit GemCap Revolving Line of Credit Agreement Effective as of July 29, 2022, we entered into a Loan and Security Agreement with Industrial Funding Group, Inc. (the “Initial Lender”) for a revolving loan credit facility for the initial principal sum of up to $4,000,000 , and through the exercise of an accordion feature, a total sum of up to $10,000,000 (the “GemCap Revolving Line of Credit Agreement”), evidenced by a Revolving Loan Secured Promissory Note, also effective as of July 29, 2022 (the “GemCap Revolving Line of Credit”). Shortly after the effective date of the GemCap Revolving Line of Credit, the Initial Lender assigned the GemCap Revolving Line of Credit Agreement, and the loan documents related thereto, to the GemCap Solutions, LLC (“GemCap” or “Senior Lender.”) Availability for borrowing under the GemCap Revolving Line of Credit is dependent upon our assets in certain eligible accounts and measures of revenue, subject to reduction for reserves that the Senior Lender may require in its discretion, and the accordion feature is a provision whereby we may request that the Senior Lender increase availability under the GemCap Revolving Line of Credit, subject to its sole discretion. Effective as of October 27, 2022, we entered into Amendment Number 1 to the Loan and Security Agreement and to the Revolving Loan Agreement Schedule, and the Amended and Restated Secured Promissory Note (Revolving Loans) with the Senior Lender to increase the principal sum available under the GemCap Revolving Line of Credit Agreement from $4,000,000 to $6,000,000 . The GemCap Revolving Line of Credit matures on July 29, 2024, and began accruing interest on the unpaid principal balance of advances, payable monthly in arrears, on September 7, 2022, at an annual rate equal to the greater of (I) the sum of (i) the “Prime Rate” as reported in the “Money Rates” column of The Wall Street Journal, adjusted as and when such Prime Rate changes, plus (ii) zero percent ( 0.00% ), and (II) four percent ( 4.00% ). Under the GemCap Revolving Line of Credit Agreement, we have granted to the Senior Lender a first-priority security interest in all of our present and future property and assets, including products and proceeds thereof. In connection with the loan, our existing secured lenders, some of whom are the RAT Lenders under our RAT Non-Revolving Line of Credit (each as defined below) (collectively, the “Subordinated Lenders”) delivered subordination agreements (the “GemCap Subordination Agreements”) to the Senior Lender. We are permitted to make regularly scheduled payments, including payments upon maturity, to such subordinated lenders and potentially other payments subject to a measure of cash flow and receiving certain financing activity proceeds, in accordance with the terms of the GemCap Subordination Agreements. In connection with the delivery of the GemCap Subordination Agreements by the Subordinated Lenders, on July 29, 2022, we issued warrants to each Subordinated Lender on identical terms for an aggregate of up to 296,329 shares of our common stock (each, a “Subordination Agreement Warrant”). Each Subordination Agreement Warrant has an exercise price of $5.25 per share, expires on July 29, 2025, and is exercisable at any time prior to such date. One warrant for 191,570 warrant shares was issued to Eagle Investment Group, LLC, an entity managed by Bruce Cassidy, Chairman of our Board of Directors (“Mr. Cassidy”), as directed by its affiliate, Excel Family Partners, LLLP (“Excel”), an entity also managed by Mr. Cassidy, one of the Subordinated Lenders. The Subordinated Lenders receiving warrants for the remaining 104,759 warrant shares were also entitled to receive a cash payment of $22,000 six months from the date of the GemCap Subordination Agreements, representing one percent ( 1.00% ) of the outstanding principal amount of the loan held by such Subordinated Lenders. This cash payment was made to those Subordinated Lenders on January 25, 2023. The GemCap Revolving Line of Credit had a balance, including accrued interest, amounting to $3,757,074 and $4,587,255 as of September 30, 2023, and 2022, respectively. We incurred interest expense for the GemCap Revolving Line of Credit in the amount of $1,379,673 and $225,345 for the twelve months ended September 30, 2023, and 2022. Non-Revolving Lines of Credit Excel Non-Revolving Line of Credit On February 23, 2022, we entered into a Non-Revolving Line of Credit Loan Agreement (the “Prior Excel Line of Credit Agreement”) with Excel, an entity managed by Bruce Cassidy, Chairman of our Board of Directors, for aggregate principal amount of $1,500,000 , which was amended on April 13, 2022, to increase the aggregate principal amount to $2,000,000 (the “$2m Line of Credit”). Effective as of April 25, 2022, we entered into a Non-Revolving Line of Credit Loan Agreement with Excel (the “Excel Non-Revolving Line of Credit Agreement”) for an aggregate principal amount of $4,022,986 (the “Excel Non-Revolving Line of Credit”). The Excel Non-Revolving Line of Credit matured eighteen (18) months from the date of the Excel Non-Revolving Line of Credit Agreement and accrues interest, payable semi-annually in arrears, at a fixed rate of interest equal to twelve percent ( 12% ) per year. On April 25, 2022, we used $2,000,000 of the proceeds of the Excel Non-Revolving Line of Credit to prepay all of the remaining outstanding principal and interest of the $2m Line of Credit and the Prior Excel Line of Credit Agreement was terminated in connection with such prepayment. Under the Excel Non-Revolving Line of Credit Agreement, we granted to the lender a security interest in all of our present and future assets and properties, real or personal, tangible or intangible, wherever located, including products and proceeds thereof (which was subsequently subordinated in connection with our GemCap Revolving Line of Credit Agreement (as defined above)). In connection with the Excel Non-Revolving Line of Credit, on April 25, 2022, we issued a warrant to Excel for an aggregate of up to 383,141 shares of our common stock. The warrant has an exercise price of $5.25 per share, expires on April 25, 2025, and is exercisable at any time prior to the expiration date. Effective as of December 14, 2022, we entered into a Non-Revolving Line of Credit Agreement Amendment and a Non-Revolving Line of Credit Promissory Note Amendment with Excel to extend the maturity date of the Excel Non-Revolving Line of Credit from eighteen (18) months to twenty-four (24) months from the date of the Excel Non-Revolving Line of Credit Agreement. Effective as of May 10, 2023, we entered into a Non-Revolving Line of Credit Agreement Amendment No. 2 and a Non-Revolving Line of Credit Promissory Note Amendment No. 2 with Excel to extend the maturity date of the Excel Non-Revolving Line of Credit from twenty-four (24) months to twenty-five (25) months from the date of the Excel Non-Revolving Line of Credit Agreement. As of September 12, 2023, $4,444,060 of principal and interest on the Excel Non-Revolving Line of Credit was outstanding (the “Excel Non-Revolving Line of Credit Pay Off Amount”). On September 12, 2023, we entered into a Note Conversion Agreement with Excel (the “Excel Non-Revolving Note Conversion Agreement”), pursuant to which Excel agreed to convert the Excel Non-Revolving Line of Credit Amount owed under the Excel Non-Revolving Line of Credit Agreement into 6,005,487 shares of our common stock, par value $0.0001 per share, at a conversion price per share of $0.74 . The Excel Non-Revolving Note Conversion Agreement contains customary representations, warranties, agreements and obligations of the parties. After the conversion of the Excel Non-Revolving Line of Credit Pay Off Amount and the issuance of the shares, there was no principal or interest remaining under the Excel Non-Revolving Line of Credit and the Prior Excel Line of Credit Agreement was terminated in connection with such conversion. The Excel Non-Revolving Line of Credit had a balance, including accrued interest, amounting to $0 and $4,226,181 as of September 30, 2023, and September 30, 2022, respectively. We incurred interest expense for the Excel Non-Revolving Line of Credit in the amount of $1,304,807 and $820,051 for the twelve months ended September 30, 2023, and 2022, respectively. RAT Non-Revolving Line of Credit Effective as of May 13, 2022, we entered into a Secured Non-Revolving Line of Credit Loan Agreement (the “RAT Non-Revolving Line of Credit Agreement”) with several institutions and individuals (each a “RAT Lender” and collectively, the “RAT Lenders”) and RAT Investment Holdings, LP, as administrator of the loan (the “Loan Administrator”) for an aggregate principal amount of $2,200,000 (the “RAT Non-Revolving Line of Credit”), . Pursuant to the terms of the RAT Non-Revolving Line of Credit Agreement, the RAT Non-Revolving Line of Credit matured eighteen (18) months from the effective date of the RAT Non-Revolving Line of Credit and accrues interest, payable semi-annually in arrears, at a fixed rate of interest equal to twelve percent ( 12% ) per year. Under the RAT Non-Revolving Line of Credit Agreement, we granted to the RAT Lenders a security interest in all of our present and future assets and properties, real or personal, tangible or intangible, wherever located, including products and proceeds thereof, which security interest is pari passu with the Excel Revolving Line of Credit Agreement (as defined above) and the May 2023 Secured Line of Credit Agreement (as defined below) and (each of which are subordinated in connection with our GemCap Revolving Line of Credit Agreement (as defined above)). In connection with the RAT Non-Revolving Line of Credit Agreement, on May 13, 2022, we issued a warrant (collectively, the “RAT Loan Warrants”) to each RAT Lender for an aggregate of up to 209,522 shares of our common stock. Each RAT Loan Warrant had an exercise price of $5.25 per share, expires on May 13, 2025, and is exercisable at any time prior to the expiration date. Effective as of November 13, 2023, we entered into a Non-Revolving Line of Credit Loan Agreement Amendment (the “RAT Non-Revolving Line of Credit Agreement Amendment”) with the RAT Lenders to: (i) extend the maturity date from eighteen (18) months to twenty-seven (27) months from the date of the RAT Non-Revolving Line of Credit Agreement, or August 13, 2024; and (ii) amend the payment terms of the RAT Non-Revolving Line of Credit Line of Credit . In consideration for the extension of the , we agreed to amend the terms of the RAT Loan Warrants as well as the Subordination Agreement Warrants issued to the RAT Lenders in connection with the GemCap Subordination Agreements described above to reduce the warrant exercise price to $1.00 . See “—GemCap Revolving Line of Credit.” one-third RAT Non-Revolving RAT Non-Revolving RAT Non-Revolving twelve RAT Non-Revolving The RAT Non-Revolving had a balance, including accrued interest, amounting to $2,300,899 and $2,301,260 as of September 30, 2023, and September 30, 2022, respectively. We incurred interest expense for the RAT Non-Revolving in the amount of $894,251 and $346,847 for the twelve months ended September 30, 2023, and 2022, respectively. May 2023 Secured Line of Credit Effective as of May 10, 2023, we entered into a Secured Non-Revolving Line of Credit Loan Agreement (the “May 2023 Secured Agreement”) with several individuals and institutional lenders for aggregate loans of up to $4.0 million (the “May 2023 Secured Line of Credit”), evidenced by Secured Non-Revolving Line of Credit Promissory Notes (each a “May 2023 Secured Note” and collectively, the “May 2023 Secured Notes”), also effective as of May 10, 2023. The May 2023 Secured Line of Credit matures twenty-four (24) months from the date of the May 2023 Secured Line of Credit Agreement and accrues interest, payable semi-annually in arrears, at a fixed rate of interest equal to twelve percent (12%) per year. We granted to the lenders under the May 2023 Secured Line of Credit Agreement a security interest in all of our present and future assets and properties, real or personal, tangible or intangible, wherever located, including products and proceeds thereof, which security interest is pari passu with the RAT Non-Revolving Line of Credit Agreement and the Excel Revolving Line of Credit Agreement, but is subordinate in rights to GemCap under the GemCap Revolving Line of Credit Agreement. See “— GemCap Revolving Line of Credit Agreement.” In connection with the May 2023 Secured Line of Credit, on May 10, 2023, we agreed to issue to each lender under the May 2023 Secured Line of Credit Agreement, upon drawdown, a warrant to purchase up to an aggregate of 369,517 shares of our common stock. The warrants have an exercise price of $4.33 per share, expire on May 10, 2026, and is exercisable at any time prior to such date. As of May 10, 2023, Excel, an entity managed by Mr. Cassidy, had committed to be a lender under the May 2023 Secured Line of Credit Agreement for an aggregate loan of $2.65 million, and as of September 11, 2023, Line of Credit. Pursuant to the terms of a Pay Off Letter Agreement with Excel dated September 12, 2023, we refinanced the outstanding principal and interest of the Excel $2.2M Line of Credit (as defined below) to be included as part of the obligations of the May 2023 Secured Line of Credit Agreement. As a result, as of September 12, 2023, Excel had loaned $2,266,733 under the May 2023 Secured Line of Credit Agreement and received a warrant See “Excel $2.2M Line of Credit.” The May 2023 Secured had a balance, including accrued interest, amounting to $3,214,769 and $0 as of September 30, 2023, and September 30, 2022, respectively. We incurred interest expense for the May 2023 Secured in the amount of $144,392 and $0 for the twelve months ended September 30, 2023, and 2022, respectively. As of December 14, 2023, the outstanding principal and interest on Excel’s portion of the May 2023 Secured Line of Credit was $2,328,617 (the “Excel May 2023 Secured Line of Credit Pay Off Amount”) . On December 14, 2023, we entered into a Note Conversion Agreement with Excel (the “Excel May 2023 Secured Line of Credit Note Conversion Agreement”) pursuant to which Excel agreed to convert the Excel May 2023 Secured Line of Credit Amount owed under the May 2023 Secured Line of Credit Agreement into 2,910,771 shares of our common stock, par value $0.0001 per share, at a conversion price per share of $0.80 . The Excel May 2023 Secured Line of Credit Note Conversion Agreement contains customary representations, warranties, agreements and obligations of the parties. After the conversion of the Excel May 2023 Secured Line of Credit Pay Off Amount and the issuance of the shares to Excel, $934,200 in principal and interest remained under the May 2023 Secured Line of Credit. As of December 15 we had issued warrants for a total of 292,540 warrant shares to Lenders in connection with the May 2023 Secured Line of Credit. Excel $2.2M Line of Credit On May 31, 2023, we entered into a Secured Non-Revolving Line of Credit Loan Agreement (“Excel $2.2M Secured Line of Credit Agreement”) with Excel, an entity managed by Bruce Cassidy, Chairman of our Board of Directors, for an aggregate principal amount of up to $2,200,000 (the “Excel $2.2M Line of Credit”), evidenced by a Non-Revolving Line of Credit Promissory Note (the “Excel $2.2M Note”). The Excel $2.2M Line of Credit matured ninety (90) days from the date of the Excel $2.2M Secured Line of Credit Agreement and accrues interest, payable in arrears on the Excel $2.2M Line of Credit maturity date, at a fixed rate of interest equal to ten and one half percent ( 10.5% ) per year. Effective as of August 29, 2023, we entered into a letter agreement (the “Excel $2.2M Line of Credit Amendment Letter Agreement”) with Excel to amend the Excel $2.2M Line of Credit Agreement and the Excel $2.2M Note to extend the maturity date of the Excel $2.2M Secured Line of Credit from ninety (90) days to one hundred twenty (120) days from the date of the Excel $2.2M Secured Line of Credit Agreement, or September 28, 2023. Under the Excel $2.2M Secured Line of Credit Agreement, we granted to Excel a security interest in all of our present and future assets and properties, real or personal, tangible or intangible, wherever located, including products and proceeds thereof, which security interest was pari passu with the RAT Non-Revolving Line of Credit Agreement, but subordinate in rights to GemCap under the GemCap Revolving Line of Credit Agreement. On September 12, 2023, we entered into a Pay Off Letter Agreement with Excel, pursuant to which we agreed to pay off the principal and interest outstanding under the $2.2M Line of Credit, amounting to $2,266,733 (the “$2.2M Line of Credit Pay Off Amount”) by refinancing the $2.2M Line of Credit Pay Off Amount to be included as part of the obligations under the May 2023 Secured Line of Credit Agreement. Under the terms of the May 2023 Secured Line of Credit Agreement, Excel was issued a warrant to purchase 209,398 shares of our common stock, which has an exercise price of $4.33 per share, expires on May 10, 2026, and is exercisable at any time prior to such date. As a result of such refinancing, there was no principal or interest remaining under the Excel $2.2M Secured Line of Credit, and the Excel $2.2M Secured Line of Credit Agreement was terminated. The Excel $2.2M Line of Credit had a balance, including accrued interest, amounting to $0 and $0 as of September 30, 2023, and 2022, respectively. We incurred interest expense for the Excel $2.2M Line of Credit in the amount of $66,733 and $0 for the twelve months ended September 30, 2023, and 2022, respectively. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 9 – 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 September 30, 2023. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Sep. 30, 2023 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 10 – 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. GemCap Revolving Line of Credit Agreement and Warrants Effective as of July 29, 2022, we entered into the GemCap Revolving Line of Credit Agreement. In connection with the loan under the GemCap Revolving Line of Credit, the Subordinated Lenders delivered the GemCap Subordination Agreements to GemCap, or the Senior Lender. In connection with the delivery of the GemCap Subordination Agreements by the Subordinated Lenders, on July 29, 2022, we issued warrants to each Subordinated Lender on identical terms for an aggregate of up to 296,329 shares of our common stock. Each warrant has an exercise price of $5.25 per share, expires on July 29, 2025. One warrant for 191,570 warrant shares was issued to Eagle Investment Group, LLC, an entity managed by Bruce Cassidy, Chairman of our Board of Directors, as directed by its affiliate, Excel, one of the Subordinated Lenders. Excel Non-Revolving Loan Agreement On February 23, 2022, we entered into a Non-Revolving Line of Credit Loan Agreement (the “Prior Excel Line of Credit Agreement”) with Excel Family Partners, LLLP (“Excel”), an entity managed by Bruce Cassidy, Chairman of our Board of Directors, for aggregate principal amount of $1,500,000 , which was amended on April 13, 2022, to increase the aggregate principal amount to $2,000,000 (the “$2m Line of Credit”). Effective as of April 25, 2022, we entered into a Non-Revolving Line of Credit Agreement with Excel (the “Excel Non-Revolving Line of Credit Agreement”) for an aggregate principal amount of $4,022,986 (the “Excel Non-Revolving Line of Credit”). The Excel Non-Revolving Line of Credit matured eighteen (18) months from the date of the Excel Non-Revolving Line of Credit Agreement and accrues interest, payable semi-annually in arrears, at a fixed rate of interest equal to twelve percent (12%) per year. On April 25, 2022, we used $2,000,000 of the proceeds of the Excel Non-Revolving Line of Credit to prepay all of the remaining outstanding principal and interest of the $2m Line of Credit and the Prior Excel Line of Credit Agreement was terminated in connection with such prepayment. Under the Excel Non-Revolving Line of Credit Agreement, we granted to the lender a security interest in all of our present and future assets and properties, real or personal, tangible or intangible, wherever located, including products and proceeds thereof (which was subsequently subordinated in connection with our GemCap Revolving Line of Credit Agreement (as defined above)). In connection with the Excel Non-Revolving Line of Credit, on April 25, 2022, we issued a warrant to Excel for an aggregate of up to 383,141 shares of our common stock. The warrant has an exercise price of $5.25 per share, expires on April 25, 2025, and is exercisable at any time prior to the expiration date. Effective as of December 14, 2022, we entered into a Non-Revolving Line of Credit Agreement Amendment and a Non-Revolving line of Credit Promissory Note Amendment with Excel to extend the maturity date of the Excel Non-Revolving Line of Credit from eighteen (18) months to twenty-four (24) months from the date of the Excel Non-Revolving Line of Credit Agreement. Effective as of May 10, 2023, we entered into a Non-Revolving Line of Credit Agreement Amendment No. 2 and a Non-Revolving Line of Credit Promissory Note Amendment No. 2 with Excel to extend the maturity date of the Excel Non-Revolving Line of Credit from twenty-four (24) months to twenty-five (25) months from the date of the Excel Non-Revolving Line of Credit Agreement. As of September 12, 2023, $4,444,060 of principal and interest on the Excel Non-Revolving Line of Credit were outstanding (the “Excel Non-Revolving Line of Credit Pay Off Amount”). On September 12, 2023, we entered into a Note Conversion Agreement with Excel (the “Excel Non-Revolving Note Conversion Agreement”), pursuant to which Excel agreed to convert the Excel Non-Revolving Line of Credit Amount owed under the Excel Non-Revolving Line of Credit Agreement into 6,005,487 shares of our common stock, par value $0.0001 per share, at a conversion price per share of $0.74 . After the conversion of the Excel Non-Revolving Line of Credit Pay Off Amount and the issuance of the shares, there was no principal or interest remaining under the Excel Non-Revolving Line of Credit and the Prior Excel Line of Credit Agreement was terminated in connection with such conversion. The Excel Non-Revolving Line of Credit had a balance, including accrued interest, amounting to $0 and $4,226,181 as of September 30, 2023, and 2022, respectively. We incurred interest expense for the Excel Non-Revolving Line of Credit in the amount of $1,304,807 and $820,051 for the twelve months ended September 30, 2023, and 2022, respectively. May 2023 Secured Line of Credit As of May 10, 2023, Excel, an entity managed by Bruce Cassidy, Chairman of our Board of Directors, had committed to be a lender under the May 2023 Secured Line of Credit Agreement for an aggregate loan of $2.65 million, and as of September 11, 2023, Line of Credit. Pursuant to the terms of a Pay Off Letter Agreement with Excel dated September 12, 2023, we refinanced the outstanding principal and interest of the Excel $2.2M Line of Credit (as described below) to be included as part of the obligations of the May 2023 Secured Line of Credit Agreement. As a result, as of September 12, 2023, Excel had loaned $2,266,733 under the May 2023 Secured Line of Credit Agreement and received a warrant The May 2023 Secured Line of Credit had a balance, including accrued interest, amounting to $3,214,769 and $0 as of September 30, 2023, and 2022, respectively. We incurred interest expense for the May 2023 Secured Line of Credit in the amount of $144,392 and $0 for the twelve months ended September 30, 2023, and 2022, respectively. As of December 14, 2023, the outstanding principal and interest on Excel’s portion of the May 2023 Secured Line of Credit was $ 2,328,617 (the “Excel May 2023 Secured Line of Credit Pay Off Amount”) . On December 14, 2023, we entered into a Note Conversion Agreement with Excel (the “Excel May 2023 Secured Line of Credit Note Conversion Agreement”) pursuant to which Excel agreed to convert the Excel May 2023 Secured Line of Credit Amount owed under the May 2023 Secured Line of Credit Agreement into 2,910,771 shares of our common stock, par value $0.0001 per share, at a conversion price per share of $0.80 . The Excel May 2023 Secured Line of Credit Note Conversion Agreement contains customary representations, warranties, agreements and obligations of the parties. After the conversion of the Excel May 2023 Secured Line of Credit Pay Off Amount and the issuance of the shares to Excel, $934,200 in principal and interest remained under the May 2023 Secured Line of Credit. Excel $2.2M Line of Credit On May 31, 2023, we entered into a Secured Non-Revolving Line of Credit Loan Agreement (“Excel $2.2M Secured Line of Credit Agreement”) with Excel, an entity managed by Bruce Cassidy, Chairman of our Board of Directors, for principal amount of up to $2,200,000 (the “Excel $2.2M Line of Credit”), evidenced by a Non-Revolving Line of Credit Promissory Note (the “Excel $2.2M Note”). The Excel $2.2M Line of Credit matured ninety (90) days from the date of the Excel $2.2M Secured Line of Credit Agreement and accrues interest, payable in arrears on the Excel $2.2M Line of Credit maturity date, at a fixed rate of interest equal to ten and one half percent ( 10.5% ) per year. Effective as of August 29, 2023, we entered into a letter agreement (the “Excel $2.2M Line of Credit Amendment Letter Agreement”) with Excel to amend the Excel $2.2M Line of Credit Agreement and the Excel $2.2M Note to extend the maturity date of the Excel $2.2M Secured Line of Credit from ninety ( 90 ) days to one hundred twenty ( 120 ) days from the date of the Excel $2.2M Secured Line of Credit Agreement, or September 28, 2023. Under the Excel $2.2M Secured Line of Credit Agreement, we granted to Excel a security interest in all of our present and future assets and properties, real or personal, tangible or intangible, wherever located, including products and proceeds thereof, which security interest was pari passu with the RAT Non-Revolving Line of Credit Agreement, but subordinate in rights to GemCap under the GemCap Revolving Line of Credit Agreement. On September 12, 2023, we entered into a Pay Off Letter Agreement with Excel, pursuant to which we agreed to pay off the principal and interest outstanding under the $2.2M Line of Credit, amounting to $2,266,733 (the “$2.2M Line of Credit Pay Off Amount”) by refinancing the $2.2M Line of Credit Pay Off Amount to be included as part of the obligations under the May 2023 Secured Line of Credit Agreement. Under the terms of the May 2023 Secured Line of Credit Agreement, Excel was issued a warrant to purchase 209,398 shares of our common stock, which has an exercise price of $4.33 per share, expires on May 10, 2026, and is exercisable at any time prior to such date. As a result of such refinancing, there was no principal or interest remaining under the Excel $2.2M Secured Line of Credit, and the Excel $2.2M Secured Line of Credit Agreement was terminated. The Excel $2.2 M Line of Credit had a balance, including accrued interest, amounting to $0 and $0 as of September 30, 2023, and 2022, respectively. We incurred interest expense for the Excel $2.2 M Line of Credit in the amount of $66,733 and $0 for the twelve months ended September 30, 2023, and 2022, respectively. 500 Limited For the twelve months ended September 30, 2023, and 2022, we paid 500 Limited $394,300 and $413,469 , respectively, for programming services provided to Loop. 500 Limited is an entity controlled by Liam McCallum, our Chief Product and Technology Officer. |
STOCKHOLDERS' EQUITY (DEFICIT)
STOCKHOLDERS' EQUITY (DEFICIT) | 12 Months Ended |
Sep. 30, 2023 | |
Equity [Abstract] | |
STOCKHOLDERS' EQUITY (DEFICIT) | NOTE 11 –STOCKHOLDERS’ EQUITY (DEFICIT) Change in Number of Authorized and Outstanding Shares On August 15, 2023, the Loop stockholders voted at our 2023 Annual Meeting of Stockholders to approve an amendment to our Restated Articles of Incorporation to increase the number of shares of common stock, par value of $0.0001 per share (“Common Stock”), authorized for issuance thereunder from 105,555,556 shares to 150,000,000 shares. On September 26, 2022, a 1 for 3 reverse stock split of our Common stock became effective. All share and per share information in the accompanying consolidated financial statements and footnotes has been retroactively adjusted for the effects of the reverse split for all periods presented. Common stock Our authorized capital stock consists of 150,000,000 shares of common stock, $0.0001 par value per share, 3,333,334 shares of Series A preferred stock, $0.0001 par value per share and 3,333,334 shares of Series B preferred stock, $0.0001 par value per share. As of September 30, 2023, and 2022, there were 65,620,151 and 56,381,209, respectively, shares of common stock issued outstanding Twelve months ended September 30, 2023 We filed a Shelf Registration Statement on Form S-3 that has been declared effective by the SEC. On May 12, 2023, we entered into an At Market (“ATM”) Issuance Sales Agreement (the “Sales Agreement”) with B. Riley Securities, Inc. (the “Agent”) pursuant to which we may offer and sell, from time to time through the Agent, shares of our Common Stock, for aggregate gross proceeds of up to $50,000,000. During the twelve months ended September 30, 2023, we issued 3,109,843 shares of Common Stock under the Sales Agreement, resulting in cash proceeds of $8,724,544, net of placement agent’s commission and related fees of $269,600 but before deducting issuance costs of $105,253. As of December 15 During the twelve months ended September 30, 2023, we issued 37,462 shares of Common Stock upon the exercise of stock options. During the twelve months ended September 30, 2023, we issued 6,005,487 shares of Common Stock to a board member upon the conversion of non-revolving line of credit plus accrued interest totaling $4,444,060. During the twelve months ended September 30, 2023, we issued 6,757 shares of Common Stock for capital raise costs. See Note 12 – Stock Options and Warrants for stock compensation discussion. Twelve months ended September 30, 2022 During the twelve months ended September 30, 2022, we issued 23,151 shares of common stock with a value of $177,000 as payment in kind for accrued interest due on certain convertible notes. Of this amount, 55,329 shares of common stock at a value of $141,000 was issued to a board member. During the twelve months ended September 30, 2022, we issued 6,666,666 shares of common stock to a board member upon conversion of 200,000 shares of Series B Preferred Stock. During the twelve months ended September 30, 2022, we issued an aggregate of 2,634,145 shares of common stock for gross cash proceeds of $13,163,500 and incurred $2,274,335 of issuance costs and underwriters discount, in a public offering. During the twelve months ended September 30, 2022, we converted convertible notes plus accrued interest in the amount of $5,313,352 into 1,988,266 shares of common stock. During the twelve months ended September 30, 2022, we issued 578,847 shares of common stock in connection with the exercise of warrants. |
STOCK OPTIONS, RESTRICTED STOCK
STOCK OPTIONS, RESTRICTED STOCK UNITS (RSUs) AND WARRANTS | 12 Months Ended |
Sep. 30, 2023 | |
Share-based Payment Arrangement, Additional Disclosure [Abstract] | |
STOCK OPTIONS, RESTRICTED STOCK UNITS (RSUs) AND WARRANTS | NOTE 12 – STOCK OPTIONS, RESTRICTED STOCK UNITS (RSUs) 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, we account 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 twelve months ended September 30, 2023: Number of Weighted Average Weighted Average Aggregate Options Exercise Price Remaining Contractual Term Intrinsic Value Outstanding at September 30, 2022 8,174,563 $ 3.78 8.05 $ 91,888,491 Grants 839,996 4.59 — — Exercised (37,462) 1.71 — — Expired — — — — Forfeited (127,792) 5.81 — — Outstanding at September 30, 2023 8,849,305 $ 3.84 6.35 $ — Exercisable at September 30, 2023 7,348,076 $ 3.64 5.82 $ — The aggregate intrinsic value in the preceding tables represents the total pretax intrinsic value, based on options with an exercise price greater than our stock price of $0.50 as of September 30, 2023, and $4.46 as of September 30, 2022, which would have been received by the option holders had those option holders exercised their options as of that date. We recognize compensation expense for all stock options granted using the fair value-based method of accounting. During the twelve months ended September 30, 2023, we issued 839,996 options valued at $4.59 per option. As of September 30, 2023, the total compensation cost related to nonvested awards not yet recognized is $4,561,372 and the weighted average period over which expense is expected to be recognized in months is 26.8. We calculated the fair value of options issued using the Black-Scholes option pricing model, with the following assumptions: September 30, 2023 Weighted average fair value of options granted $ 4.59 Expected life 5.88 Risk-free interest rate 3.97 % Expected volatility 52.30 % Expected dividends yield — % Forfeiture rate — % The stock-based compensation expense related to option grants was $6,326,055 and $8,889,474, for the twelve months ended September 30, 2023, and 2022, respectively. Restricted stock units On September 18, 2022, the Compensation Committee of our Board of Directors approved Restricted Stock Unit (“RSU”) awards to certain officers and key employees pursuant to the terms of the Loop Media, Inc. Amended and Restated 2020 Equity Incentive Compensation Plan (the “2020 Plan”). On September 22, 2022, we granted an aggregate of 890,000 RSUs, which vest over time subject to continued service. Each RSU was valued at the public offering price during our initial public offering of $5.00 per share, and twenty-five percent (25%) of the RSUs vest on the one-year anniversary of the grant date and the remainder in equal quarterly installments over the following three-year period. On January 3, 2023, the Compensation Committee of our Board of Directors approved RSU awards as compensation to members of our Board of Directors pursuant to the 2020 Plan. On January 3, 2023, we granted an aggregate of 212,004 RSUs which vest over time subject to continued service. Each RSU was valued at $6.23 per share. Twenty-five percent (25%) of 130,464 RSUs vest on the one-year anniversary of the grant date and the remainder in equal quarterly installments over the following three-year period. One hundred percent (100%) of 81,540 RSUs vest on the day after the end of the fiscal year in which the grant was made. On July 1, 2023, we granted an aggregate of 54,393 RSUs which vested one hundred percent (100%) on the grant date. Each RSU was valued at $2.39 per share. The following table summarizes the RSU activity for the twelve months ended September 30, 2023: Number of Weighted Average Aggregate RSUs Fair Value Intrinsic Value Outstanding at September 30, 2022 890,000 $ 5.00 $ 442,330 Granted 266,397 5.45 105,366 Vested (295,643) 4.52 119,901 Expired — — — Forfeited — — — Outstanding at September 30, 2023 860,754 $ 5.30 $ 427,795 The aggregate intrinsic value in the preceding tables represents the total pretax intrinsic value, based on our stock price of $0.50 as of September 30, 2023, and $4.46 as of September 30, 2022, which would have been received by the RSU holders as of that date. The stock-based compensation expense related to RSU grants was $1,755,995 and $27,356, for the twelve months ended September 30, 2023, and 2022, respectively. As of September 30, 2023, the total compensation cost related to nonvested RSU awards not yet recognized was $3,881,303 and the weighted average period over which expense is expected to be recognized is 36.3 months. Warrants The following table summarizes the warrant activity for the twelve months ended September 30, 2023: Number of Weighted average exercise shares price per share Outstanding at September 30, 2022 5,300,033 $ 5.82 Issued 292,540 4.43 Exercised — — Expired — — Outstanding at September 30, 2023 5,592,573 $ 5.74 We record all warrants granted using the fair value-based method of accounting. During the twelve months ended September 30, 2023, we issued 292,540 warrants in conjunction with debt. We allocated the fair value of the warrants at inception as debt discount and recorded the straight-line amortization ratably over the life of the debt as interest expense. During the twelve months ended September 30, 2023, we recorded $447,897 as debt discount and amortized as interest expense. We recorded consulting expense of $276,610 as a result of current period vesting of previously issued warrants to various companies for consulting services. We calculated the fair value of warrants issued using the Black-Scholes option pricing model, with the following assumptions: September 30, 2023 Weighted average fair value of warrants granted $ 4.33 Expected life 2.79 years Risk-free interest rate 4.56 % Expected volatility 47.63 % Expected dividends yield - % Forfeiture rate - % |
INCOME TAX
INCOME TAX | 12 Months Ended |
Sep. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
INCOME TAX | NOTE 13 - INCOME TAX The Inflation Reduction Act of 2022 (the “Act”) was signed into U.S. law on August 16, 2022. The Act includes various tax provisions, including an excise tax on stock repurchases, expanded tax credits for clean energy incentives, and a corporate alternative minimum tax that generally applies to U.S. corporations with average adjusted annual financial statement income over a three-year period in excess of $1 billion. We do not expect the Act to materially impact our financial statements. Effective beginning in fiscal 2022, the U.S. Tax Cuts and Job Act of 2017 requires us to deduct U.S. and international research and development expenditures ("R&D") for tax purposes over 5 to 15 years, instead of in the current fiscal year. We concurrently record a deferred tax benefit for the future amortization of the research and development for tax purposes. The requirement to expense R&D as incurred is unchanged for U.S. GAAP purposes and the impact to pre-tax R&D expense is not affected by this provision. The components of income (loss) before the provision (benefit) for income taxes are as follows: Twelve months ended September 30, 2023 2022 Domestic Operations $ (31,452,978) $ (29,123,800) Foreign Operations (492,189) (356,324) Total $ (31,945,167) $ (29,480,124) The provision for income taxes consists of the following: Twelve months ended September 30, 2023 2022 Current: Federal $ — $ — State 18,512 (676) Foreign — — Total Current provision (benefit) 18,512 (676) Deferred: Federal — — State — — Foreign — — Total Deferred provision (benefit) — — Total provision (benefit) $ 18,512 $ (676) The effective tax rate differs from the U.S. income tax rate as follows: September 30, 2023 2022 U.S. federal statutory rate 21.00 % 21.00 % State income taxes, net of federal benefit 7.62 % 1.65 % Goodwill impairment — % (1.40) % Non-deductible items (1.23) % (0.12) % Change in valuation allowance (33.13) % (18.08) % Change in tax rates 4.10 % (0.18) % US effects of foreign operations (0.07) % (0.04) % Deferred tax true-up (0.79) % (2.79) % Other 2.43 % (0.04) % Effective tax rate (0.07) % 0.00 % Deferred income taxes reflect the net effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting and tax purposes. Significant components of our deferred tax assets and liabilities are as follows: September 30, 2023 2022 Deferred tax assets: Net operating losses $ 16,532,642 $ 10,045,027 Allowance for doubtful accounts 133,539 189,124 Stock-based compensation 6,766,029 3,982,495 Accrued expenses 382,321 4,806 Intangible book/tax basis difference 1,900,189 1,695,480 Other 10,436 — Total deferred tax assets, net 25,725,156 15,916,932 Less: reserve for allowance (25,237,534) (14,748,164) Total deferred tax assets, net of valuation allowance $ 487,622 $ 1,168,768 Deferred tax liabilities: Fixed assets book/ tax basis difference (22,606) (298,437) Operating right of use assets — (277) Debt discount (462,873) (870,054) Other (2,143) — Total deferred tax liabilities $ (487,622) $ (1,168,768) Total deferred tax liabilities, net $ — $ — In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that the deferred tax assets will be realized. The ultimate realization of deferred tax assets is based on the assessment of available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit the utilization of existing deferred tax assets. A significant piece of objective negative evidence evaluated was the cumulative loss incurred over the prior three-year period ended September 30, 2023. Such objective evidence limits the ability to consider subject evidence such as our projections for future growth. Based on this assessment, we maintained a full valuation allowance against our net deferred tax assets as of September 30, 2023, and 2022. If these estimates and assumptions change in the future, we may be required to reduce our existing valuation allowance resulting in less income tax expense. For the year ended September 30, 2023, the valuation allowance increased by approximately $10.5 million from the prior year primarily from current year operating losses for which no tax benefit was provided. As of September 30, 2023, we have federal net operating loss carryforwards of $59.9 million of which $1.6 million expire between 2036 and 2037 and available to offset 100% of future taxable income. The remaining $58.3 million of federal net operating losses have an indefinite carryforward period but is available to offset only 80% of future taxable income. Our ability to use our federal net operating carryforwards may be limited if we experience an “ownership change” as defined in Section 382 (“Section 382”) of the Internal Revenue Code of 1986, as amended. As we are continuing to generate taxable losses, we have not completed an analysis under Section 382 to determine whether any such limitations have been triggered as of September 30, 2023. As of September 30, 2023, we have state net operating loss carryforwards of $57 million. The state NOLs begin to expire in 2037. We have Singapore net operating loss carryforwards of $2.2 million which have an indefinite carryforward period. We applied the applicable authoritative guidance which prescribes a comprehensive model for the manner in which a company should recognize, measure, present and disclose in its financial statements all material uncertain tax positions that it has taken or expects to take on a tax return. As of September 30, 2023, and 2022, we had no uncertain tax positions. We do not expect that our unrecognized tax benefits will significantly increase or decrease within twelve months. We file income tax returns in the U.S., Singapore and various U.S. state jurisdictions. As of September 30, 2023, the U.S. federal tax years open to examination by the Internal Revenue Service are 2019 through 2022. The Singapore and various U.S. state returns remain open to examination for 2018 through 2022. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Sep. 30, 2023 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 14 – SUBSEQUENT EVENTS We have evaluated all subsequent events through the date of this Report on Form 10-K with the SEC, to ensure that this filing includes appropriate disclosure of events both recognized in the financial statements as of September 30, 2023, and events which occurred after September 30, 2023, but which were not recognized in the financial statements. Excel Revolving Line of Credit Effective as of December 14, 2023, we entered into a Revolving Line of Credit Loan Agreement with Excel (the “Excel Revolving Line of Credit Agreement”) for up to a principal sum of $2,500,000, under which we may pay down and re-borrow up to the maximum amount of the $2,500,000 limit (the “Excel Revolving Line of Credit”). Our drawdown on the Excel Revolving Line of Credit is limited to no more than twenty-five percent (25%) of the last three full months’ revenue, not to exceed $1,250,000 in any quarter, and not to exceed in aggregate the outstanding debt amount of $2,500,000.The Excel Revolving Line of Credit is a perpetual loan, with a maturity date that is twelve ( 12 pari passu Under the terms of the Excel Revolving Line of Credit Agreement, on December 14, 2023, we agreed to issue to Excel a warrant to purchase up to an aggregate of 3,125,000 shares of our common stock. Each warrant has an exercise price of $0.80 per share, which was the closing price of our common stock on December 14, 2023, expires on December 14, 2026, and is exercisable at any time prior to such date , to the extent that after giving effect to such exercise, Excel and its affiliates would beneficially own, for purposes of Section 13(d) of the Exchange Act, no more than 29.99% of the outstanding shares of our common stock As of the date of this Report, we had not drawn down any funds from the Excel Revolving Line of Credit. Excel May 2023 Secured Line of Credit Note Conversion Agreement As of December 14, 2023, the outstanding principal and interest on Excel’s portion of the May 2023 Secured Line of Credit was $2,328,617 (the “Excel May 2023 Secured Line of Credit Pay Off Amount”) of the total aggregate principal and interest outstanding under the May 2023 Secured Line of Credit of $ 3,262,817 . On December 14, 2023, we entered into a Note Conversion Agreement with Excel (the “Excel May 2023 Secured Line of Credit Note Conversion Agreement”) pursuant to which Excel agreed to convert the Excel May 2023 Secured Line of Credit Amount owed under the May 2023 Secured Line of Credit Agreement into 2,910,771 shares of our common stock, par value $0.0001 per share, at a conversion price per share of $0.80 . The Excel May 2023 Secured Line of Credit Note Conversion Agreement contains customary representations, warranties, agreements and obligations of the parties. After the conversion of the Excel May 2023 Secured Line of Credit Pay Off Amount and the issuance of the shares to Excel, $934,200 in principal and interest remained under the May 2023 Secured Line of Credit. Repricing and Exercise of Certain Existing Warrants On December 14, 2023, we agreed to offer to amend certain existing warrants exercisable for an aggregate of up to 4,055,240 shares of the Company’s common stock (each such warrant an “Existing Warrant”) to reduce the respective exercise prices thereof to $0.80 per share (such new price being referred to as the “Amended Warrant Exercise Price”), which was the closing price per share of our common stock as quoted on the NYSE American on December 13, 2023, on the condition that the holder of each Existing Warrant will commit to exercise the Existing Warrant within eight |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation The consolidated financial statements include our accounts and our wholly-owned subsidiary, EON Media Group Pte. Ltd. (“EON Media”) and Retail Media TV, Inc. These consolidated financial statements are prepared using the accrual basis of accounting in accordance with accounting principles generally accepted in the United States (“GAAP”). All inter-company transactions and balances have been eliminated on consolidation. |
Use of estimates | Use of estimates The preparation of the financial statements in conformity with generally accepted accounting principles 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 revenue recognition of performance obligations, allowance for doubtful accounts, fair value of stock-based compensation awards, income taxes and going concern. |
Segment reporting | Segment reporting We report as one reportable 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 losses on such accounts. On September 30, 2023, and 2022, we had no cash equivalents. As of September 30, 2023, and 2022, approximately $2,818,696 and $13,821,914 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 judgement and includes the review of individual receivables based on individual customers, current economic trends and analysis of historical bad debts. As of September 30, 2023, and 2022, we had recorded an allowance for doubtful accounts of $630,629 and $646,013, respectively. |
Concentration of credit risk | Concentration of credit risk During the twelve-months ended September 30, 2023, we had two customers which each individually comprised greater than 10% of net revenue. These customers represented 14%, and 12% of net revenue, respectively. No other customer accounted for more than 10% of net revenue during the periods presented. During the twelve-months ended September 30, 2022, we had two customers which each individually comprised greater than 10% of net revenue. These customers represented 15%, and 11% of net revenue, respectively. No other customer accounted for more than 10% of net revenue during the periods presented. As of September 30, 2023, one customer accounted for a total of 18% of our accounts receivable balance. No other customer accounted for more than 10% of total accounts receivable. As of September 30, 2022, three customers accounted for a total of 49% of our accounts receivable balance or 21%, 17%, and 11%, respectively. No other customer accounted for more than 10% of total accounts receivable. We grant credit in the normal course of business to our customers. Periodically, we review past due accounts and make 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. |
Prepaid expenses | Prepaid expenses Expenditures paid in one accounting period which will not be consumed until a future period such as insurance premiums and annual subscription fees are accounted for on the balance sheet as a prepaid expense. When the asset is eventually consumed, it is charged to expense. |
Content Asset | Content Asset We capitalize the fixed content fees and corresponding liability when the license period begins, the cost of the content is known, and the content is accepted and available for streaming. If the licensing fee is not determinable or reasonably estimable, no asset or liability is recorded, and licensing costs are expensed as incurred. We amortize licensed content assets into cost of revenue, using the straight-line method over the contractual period of availability. The liability is paid in accordance with the contractual terms of the arrangement. Internally-developed content costs are capitalized in the same manner as licensed content costs, when the cost of the content is known and the content is ready and available for streaming. We amortize internally-developed content assets into cost of revenue, using the straight-line method over the estimated period of streaming. |
Long-lived assets | Long-lived assets We evaluate the recoverability of long-lived assets, including intangible assets, for impairment when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Conditions that would necessitate an impairment assessment include a significant decline in the observable market value of an asset, a significant change in the extent or manner that an asset is used, or a significant adverse change that would indicate that the carrying amount of an asset or group of assets is not recoverable. For long-lived assets to be held and used, we recognize an impairment loss only if their carrying amount is not recoverable through the undiscounted cash flows. The impairment loss is based on the difference between the carrying amount and estimated fair value as determined by discounted future cash flows. Our finite long-lived intangible assets are amortized on a straight-line basis over their estimated useful lives, which range from two |
Property and equipment, net | Property and equipment, net Property and equipment are stated at cost, less accumulated depreciation. Depreciation is calculated using the straight-line method over the asset’s estimated useful life. Our capitalization policy is to capitalize property and equipment purchases greater than $3,000, as well as internally-developed software enhancements. Expenditures for maintenance and repairs are expensed as incurred. When retired or otherwise disposed, the related carrying value and accumulated depreciation are removed from the respective accounts and the net difference less any amount realized from disposition is reflected in earnings. Loop Players are capitalized as fixed assets and depreciated over the estimated period of use. See below for estimated useful lives: |
Operating leases | Loop Players 3 years Equipment 3 Software 3 years 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 our 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 our 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 twelve months, we have elected the short-term lease measurement and recognition exemption, and we 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 a nonrecurring basis as required by US GAAP. Assets recognized or disclosed at fair value in the condensed consolidated financial statements on a nonrecurring basis include items such as property and equipment, operating lease assets, goodwill, and other intangible assets, which are measured at fair value if determined to be impaired. |
Advertising costs | Advertising costs We expense all advertising costs as incurred. Advertising and marketing costs for the twelve months ended September 30, 2023, and 2022, were $11,149,084 and $7,255,962, respectively. |
Revenue recognition | Revenue recognition We recognize revenue in accordance with ASC 606, Revenue from Contracts with Customers, when it satisfies a performance obligation by transferring control over a product to a customer. Revenue is measured based on the consideration we expect to receive in exchange for those products. In instances where final acceptance of the product is specified by the client, revenue is deferred until all acceptance criteria have been met. For example, we bill subscription services in advance of when the service is performed and revenue is treated as deferred revenue until the service is performed and/or the performance obligation is satisfied. Revenues are recognized under Topic 606 in a manner that reasonably reflects the delivery of our products and services to clients in return for expected consideration and includes the following elements: ● executed contracts with our customers that we believe 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. Our revenue can be categorized into two revenue streams: Advertising revenue and Legacy and other revenue. The following table disaggregates our revenue by major type for each of the periods indicated: Twelve months ended September 30, 2023 2022 Advertising revenue $ 28,740,623 $ 26,060,885 Legacy and other revenue 2,901,670 4,771,911 Total $ 31,642,293 $ 30,832,796 Performance obligations and significant judgments Our performance obligations and recognition patterns for each revenue stream are as follows: Advertising revenue For the twelve months ended September 30, 2023, advertising revenue accounts for 91% of our revenue and includes revenue from direct and programmatic advertising as well as sponsorships. For all advertising revenue sources, we evaluate whether we should be considered the principal (i.e., report revenues on a gross basis) or an agent (i.e., report revenues on a net basis). Our role as principal or agent differs based on our performance obligation for each revenue share arrangement. For both the O&O and Partner Platforms businesses, advertising inventory provided to advertisers through the use of an advertising demand partner or agency, with whose fees or commission is calculated based on a stated percentage of gross advertising spending, we are considered the agent and our revenues are reported net of agency fees and commissions. We are considered the agent because the demand partner or agency controls all aspects of the transaction (pricing risk, inventory risk, obligation for fulfillment) except for the devices used to show the advertisements, therefore we report this advertising revenue net of agency fees and commissions. We are considered the principal in our arrangements with content providers in our O&O Platform business and with our arrangements with our third-party partners in our Partner Platforms business and thus report revenues on a gross basis (net of agency fees and commissions), wherein the amounts billed to our advertising demand partners, advertising agencies, and direct advertisers and sponsors are recorded as revenues, and amounts paid to content providers and third-party partners are recorded as expenses. We are considered the principal because we control the advertising space, are primarily responsible to our advertising demand partners and other parties filling our advertising inventory, have discretion in pricing and advertising fill rates and typically have an inventory risk. For advertising revenue, we recognize revenue at the time the digital advertising impressions are filled and the advertisements are played and, for sponsorship revenue, we generally recognize revenue ratably over the term of the sponsorship arrangement as the sponsored advertisements are played. Legacy and other business revenue For the twelve months ended September 30, 2023, legacy and other business revenue accounts for the remaining 9% of total revenue and includes streaming services, subscription content services, and hardware delivery, as described below: o Delivery of streaming services including content encoding and hosting. We recognize revenue over the term of the service based on bandwidth usage. Revenue from streaming services is insignificant. o Delivery of subscription content services in customized formats. We recognize revenue straight-line 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. Revenue from hardware sales is insignificant. 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 | Customer acquisition costs Customer acquisition costs consist of marketing costs and affiliate fees associated with the O&O Platform business. They are included in operating expenses and expensed as incurred. |
Cost of revenue | Cost of revenue Cost of revenue for the O&O Platform and legacy businesses represents the amortized cost of ongoing licensing and hosting fees, which is recognized over time based on usage patterns. The depreciation expense associated with the Loop Players is not included in cost of sales. Cost of revenue for the Partner Platforms business represents hosting fees, amortized costs of internally-developed content, and the revenue share with third party partners (after deduction of allocated infrastructure costs). The cost of revenue is higher with partners within the Partner Platforms versus those within the O&O Platform because we leverage our Partner Platforms partners’ network of customers and their screens to deliver content and advertising inventory, rather than using our own Loop Players. |
Deferred income | Deferred income As of September 30, 2023, we no longer bill subscription services in advance of when the service period is performed. The deferred income recorded at September 30, 2022, 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 (“ASC 260-10”), which requires presentation of basic and diluted earnings per share (“EPS”) on the face of the statement of operations for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation to the numerator and denominator of the diluted EPS. 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 September 30, 2023, and 2022, respectively, because their inclusion would have been anti-dilutive. September 30, 2023 2022 Options to purchase common stock 8,849,305 8,174,583 Warrants to purchase common stock 5,592,573 5,300,033 Restricted Stock Units (RSUs) 1,156,397 890,000 Series A preferred stock — — Series B preferred stock — — Convertible debentures — — Total common stock equivalents 15,598,275 14,364,616 |
Shipping and handling costs | Shipping and handling costs Loop Players are provided as part of the charge for service to our customers. Loop Media absorbs any associated costs of shipping and handling and records as an operational expense at the time of service. |
Income taxes | Income taxes We account for income taxes in accordance with ASC Topic 740, Income Taxes (“ASC 740”). ASC 740 requires a company to use the asset and liability method of accounting for income taxes, whereby deferred tax assets are recognized for deductible temporary differences, and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion, or all of, the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effect of changes in tax laws and rates on the date of enactment. Under ASC 740, a tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. We have no material uncertain tax positions for any of the reporting periods presented. We recognize accrued interest and penalties related to unrecognized tax benefits as part of income tax expense. We have also made a policy election to treat the income tax with respect to global intangible low-tax income as a period expense when incurred. In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2019-12, Simplifying the Accounting for Income Taxes, as part of its initiative to reduce complexity in accounting standards. The amendments in the ASU are effective for fiscal years beginning after December 15, 2020, including interim periods therein. The adoption of this standard in the first quarter of 2022 had no impact on our consolidated financial statements. |
Stock-based compensation | Stock-based compensation Stock-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 stock-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. |
Deferred costs | Deferred costs Deferred costs represent legal, accounting and other direct costs related to our efforts to raise capital through a public or private sale of our Common Stock. Costs related to the public sale of our Common Stock are deferred until the completion of the applicable offering, at which time such costs are reclassified to additional paid-in-capital as a reduction of the proceeds. Costs related to the private sale of our Common Stock are deferred until the completion of the applicable offering, at which time such costs are amortized over the term of the applicable purchase agreement. |
Employee Retention Credit | Employee retention credits In March 2020, the Coronavirus Aid, Relief, and Economic Security Act was signed into law, providing numerous tax provisions and other stimulus measures, including the Employee Retention Credit (“ERC”): a refundable tax credit against certain employment taxes. The Taxpayer Certainty and Disaster Tax Relief Act of 2020 and the American Rescue Plan Act of 2021 extended and expanded the availability of the ERC. We qualified for the ERC in the third and fourth quarters of 2020 and the first, second and third quarters of 2021. During the twelve months ended September 30, 2023, we recorded an aggregate benefit of $645,919 in our condensed combined income statement to reflect the ERC. |
Reclassifications | Reclassifications Certain prior year amounts have been reclassified to conform to current year presentation. These reclassifications have no effect on the previously reported financial position, results of operations, or cash flows. Previously reported accounts payable and accrued liabilities have now been disaggregated into accounts payable, accrued liabilities, and accrued royalty. Further, stock-based compensation and depreciation and amortization expenses have now been segregated from sales, general and administrative expenses and separately reported within operating expenses. |
Restructuring costs | Restructuring costs We undertook initiatives to increase efficiency and cut costs, while still maintaining our focus on, and dedication to, the continued growth of our business. During the twelve months ended September 30, 2023, we made cuts and adjustments across several aspects of our business. We completed a plan to reduce our overall SG&A costs by approximately 20% , including labor and various other operating costs. Part of this reduction included eliminating some non-revenue generating headcount, while continuing to invest in expansion of our revenue and ad sales team. Our restructuring costs for the year ended September 30, 2023, were $950,986 compared to $0 for the year ended September 30, 2022, primarily due to the reduction of headcount and the integration of Loop Media Studios division into other areas of our business. |
Recently adopted and recent accounting pronouncements | Recently adopted accounting pronouncements In August 2020, the FASB issued ASU 2020-06, Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40). This ASU reduces the number of accounting models for convertible debt instruments and convertible preferred stock as well as amend the guidance for the derivatives scope exception for contracts in an entity’s own equity to reduce form-over-substance-based accounting conclusions. In addition, this ASU improves and amends the related EPS guidance. The ASU is effective for interim and annual periods beginning after December 15, 2021, with early adoption permitted for periods beginning after December 15, 2020. Adoption of the ASU can either be on a modified retrospective or full retrospective basis. We adopted this ASU as of October 1, 2022, and there is no material impact to our financial statements. Recent accounting pronouncements In September 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This guidance requires the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions and reasonable and supportable forecasts. This guidance also requires enhanced disclosures regarding significant estimates and judgments used in estimating credit losses. The new guidance is effective for fiscal years beginning after December 15, 2022. We are currently evaluating the impact of this standard on our condensed consolidated financial statements and related disclosures. In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, that would enhance disclosures for significant segment expenses for all public entities required to report segment information in accordance with ASC 280. ASC 280 requires a public entity to report for each reportable segment a measure of segment profit or loss that its chief operating decision maker (“CODM”) uses to assess segment performance and to make decisions about resource allocations. The amendments in ASU 2023-07 improve financial reporting by requiring disclosure of incremental segment information on an annual and interim basis for all public entities to enable investors to develop more useful financial analyses. Currently, Topic 280 requires that a public entity disclose certain information about its reportable segments. For example, a public entity is required to report a measure of segment profit or loss that the CODM uses to assess segment performance and make decisions about allocating resources. ASC 280 also requires other specified segment items and amounts such as depreciation, amortization and depletion expense to be disclosed under certain circumstances. The amendments in ASU 2023-07 do not change or remove those disclosure requirements. The amendments in ASU 2023-07 also do not change how a public entity identifies its operating segments, aggregates those operating segments, or applies the quantitative thresholds to determine its reportable segments. The amendments in ASU 2023-07 are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. A public entity should apply the amendments in ASU 2023-07 retrospectively to all prior periods presented in the financial statements. We are currently evaluating the impact of this standard on our condensed consolidated financial statements and related disclosures. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 is intended to enhance the transparency and decision usefulness of income tax disclosures. The amendments in ASU 2023-09 address investor requests for enhanced income tax information primarily through changes to the rate reconciliation and income taxes paid information. ASU 2023-09 will be effective for us in the annual period beginning October 1, 2025, though early adoption is permitted. We are still evaluating the presentational effect that ASU 2023-09 will have on our consolidated financial statements, but we expect considerable changes to our income tax footnote. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Schedule of estimated useful lives | See below for estimated useful lives: |
Schedule of revenue by category | The following table disaggregates our revenue by major type for each of the periods indicated: Twelve months ended September 30, 2023 2022 Advertising revenue $ 28,740,623 $ 26,060,885 Legacy and other revenue 2,901,670 4,771,911 Total $ 31,642,293 $ 30,832,796 |
Schedule of weighted average diluted shares | The following securities are excluded from the calculation of weighted average diluted shares at September 30, 2023, and 2022, respectively, because their inclusion would have been anti-dilutive. September 30, 2023 2022 Options to purchase common stock 8,849,305 8,174,583 Warrants to purchase common stock 5,592,573 5,300,033 Restricted Stock Units (RSUs) 1,156,397 890,000 Series A preferred stock — — Series B preferred stock — — Convertible debentures — — Total common stock equivalents 15,598,275 14,364,616 |
CONTENT ASSETS (Tables)
CONTENT ASSETS (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
Content Assets [Abstract] | |
Schedule of amortization expense | September 30, 2023 2022 Licensed Content Assets $ 2,882,106 $ 1,236,933 Internally-Developed Assets 64,297 13,420 Total $ 2,946,403 $ 1,250,353 |
Schedule of future amortization expense | Fiscal Year 2024 Fiscal Year 2025 Fiscal Year 2026 Licensed Content Assets $ 2,218,894 $ 210,463 $ 97,402 Internally-Developed Assets 72,860 59,440 8,563 Total $ 2,291,754 $ 269,903 $ 105,965 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
Table Text Block Supplement [Abstract] | |
Schedule of equipment | September 30, 2023 2022 Loop Players $ 2,536,937 $ 1,259,402 Equipment 801,301 703,341 Software 854,966 404,058 4,193,204 2,366,801 Less: accumulated depreciation (1,481,646) (733,632) Total property and equipment, net $ 2,711,558 $ 1,633,169 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
Table Text Block Supplement [Abstract] | |
Schedule of other intangible assets | Our other intangible assets, each definite lived assets, consisted of the following as of September 30, 2023, and 2022: September 30, Useful life 2023 2022 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 (732,111) (619,667) Total (732,111) (619,667) Total intangible assets, net $ 477,889 $ 590,333 |
OPERATING LEASES (Tables)
OPERATING LEASES (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
Schedule of lease liability | September 30, 2023 2022 Short term portion $ — $ 75,529 Long term portion — — Total lease liability $ — $ 75,529 |
Schedule of lease expense | Twelve months ended September 30, 2023 2022 Operating lease expense $ 79,434 $ 177,776 Short-term lease expense 113,590 9,000 Total lease expense $ 193,024 $ 186,776 |
ACCOUNTS PAYABLE AND ACCRUED _2
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
Payables and Accruals [Abstract] | |
Schedule of accounts payable and accrued expenses | Accounts payable and accrued expenses consisted of the following as of September 30, 2023, and 2022: September 30, 2023 2022 Accounts payable $ 4,978,920 $ 7,453,801 Performance bonuses 1,262,000 2,970,000 Interest payable 175,094 348,150 Professional fees 449,944 505,169 Marketing 800,165 344,309 Commissions — 425,321 Insurance liabilities 552,000 602,970 Other accrued liabilities 307,135 424,954 Accrued liabilities 3,546,338 5,620,873 Accrued royalties and revenue share 4,930,329 4,559,088 Total accounts payable and accrued expenses $ 13,455,587 $ 17,633,762 |
DEBT (Tables)
DEBT (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
Debt Instruments [Abstract] | |
Schedule of classifications of non-revolving line of credit | Lines of Credit as of September 30, 2023: Unpaid Contractual Net Carrying Value Principal Interest Rates Contractual Warrants Related party lines of credit: Current Long Term Balance Cash Maturity Date issued $4,000,000 non-revolving line of credit, May 10, 2023 $ — $ 1,959,693 $ 2,266,733 12% 5/10/2025 209,398 Total related party lines of credit, net $ — $ 1,959,693 $ 2,266,733 Lines of credit: $2,200,000 non-revolving line of credit, May 13, 2022 $ 2,124,720 $ — $ 2,200,000 12% 11/13/2023 314,286 $6,000,000 revolving line of credit, July 29, 2022 2,985,298 — 3,730,914 Greater of 4% or Prime 7/29/2024 — $4,000,000 non-revolving line of credit, May 10, 2023 — 475,523 900,000 12% 5/10/2025 83,142 Total lines of credit, net $ 5,110,018 $ 475,523 $ 6,830,914 Lines of Credit as of September 30, 2022: Unpaid Contractual Net Carrying Value Principal Interest Rates Contractual Warrants Related party lines of credit: Current Long Term Balance Cash Maturity Date issued $4,022,986 non-revolving line of credit, April 25, 2022 $ — $ 2,575,753 $ 4,022,986 12% 10/25/2023 383,141 Total related party lines of credit, net $ — $ 2,575,753 $ 4,022,986 Lines of credit: $2,200,000 non-revolving line of credit, May 13, 2022 $ — $ 1,494,469 $ 2,200,000 12% 11/13/2023 314,286 $6,000,000 revolving line of credit, July 29, 2022 — 3,030,516 4,543,560 Greater of 4% or Prime 7/29/2024 — Total lines of credit, net $ — $ 4,524,985 $ 6,743,560 |
Schedule of interest expense related to the contractual interest coupon and the amortization of debt discounts on the convertible debentures | The following table presents the interest expense related to the contractual interest coupon and the amortization of debt discounts on the convertible debentures: Twelve months ended September 30, 2023 2022 Interest expense $ 1,363,314 $ 919,372 Amortization of debt discounts 2,426,544 2,691,617 Total $ 3,789,858 $ 3,610,989 |
Schedule of maturity analysis under line of credit agreements | Maturity analysis under the line of credit agreements for the fiscal years ended September 30, 2024 $ 5,930,914 2025 3,166,733 2026 — 2027 — 2028 — Lines of credit, related and non-related party 9,097,647 Less: Debt discount on lines of credit payable (1,552,413) Total Lines of credit payable, related and non-related party, net $ 7,545,234 |
STOCK OPTIONS, RESTRICTED STO_2
STOCK OPTIONS, RESTRICTED STOCK UNITS (RSUs) AND WARRANTS (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
Share-based Payment Arrangement, Additional Disclosure [Abstract] | |
Schedule of stock option activity | The following table summarizes the stock option activity for the twelve months ended September 30, 2023: Number of Weighted Average Weighted Average Aggregate Options Exercise Price Remaining Contractual Term Intrinsic Value Outstanding at September 30, 2022 8,174,563 $ 3.78 8.05 $ 91,888,491 Grants 839,996 4.59 — — Exercised (37,462) 1.71 — — Expired — — — — Forfeited (127,792) 5.81 — — Outstanding at September 30, 2023 8,849,305 $ 3.84 6.35 $ — Exercisable at September 30, 2023 7,348,076 $ 3.64 5.82 $ — |
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: September 30, 2023 Weighted average fair value of options granted $ 4.59 Expected life 5.88 Risk-free interest rate 3.97 % Expected volatility 52.30 % Expected dividends yield — % Forfeiture rate — % |
Summary of the RSU activity | The following table summarizes the RSU activity for the twelve months ended September 30, 2023: Number of Weighted Average Aggregate RSUs Fair Value Intrinsic Value Outstanding at September 30, 2022 890,000 $ 5.00 $ 442,330 Granted 266,397 5.45 105,366 Vested (295,643) 4.52 119,901 Expired — — — Forfeited — — — Outstanding at September 30, 2023 860,754 $ 5.30 $ 427,795 |
Schedule of warrant activity | The following table summarizes the warrant activity for the twelve months ended September 30, 2023: Number of Weighted average exercise shares price per share Outstanding at September 30, 2022 5,300,033 $ 5.82 Issued 292,540 4.43 Exercised — — Expired — — Outstanding at September 30, 2023 5,592,573 $ 5.74 |
Schedule of fair value of warrants issued | September 30, 2023 Weighted average fair value of warrants granted $ 4.33 Expected life 2.79 years Risk-free interest rate 4.56 % Expected volatility 47.63 % Expected dividends yield - % Forfeiture rate - % |
INCOME TAX (Tables)
INCOME TAX (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of components of income (loss) before the provision (benefit) for income taxes | Twelve months ended September 30, 2023 2022 Domestic Operations $ (31,452,978) $ (29,123,800) Foreign Operations (492,189) (356,324) Total $ (31,945,167) $ (29,480,124) |
Schedule of income tax expense (benefit) | Twelve months ended September 30, 2023 2022 Current: Federal $ — $ — State 18,512 (676) Foreign — — Total Current provision (benefit) 18,512 (676) Deferred: Federal — — State — — Foreign — — Total Deferred provision (benefit) — — Total provision (benefit) $ 18,512 $ (676) |
Schedule of the reconciliation between U.S. statutory federal income tax rate | September 30, 2023 2022 U.S. federal statutory rate 21.00 % 21.00 % State income taxes, net of federal benefit 7.62 % 1.65 % Goodwill impairment — % (1.40) % Non-deductible items (1.23) % (0.12) % Change in valuation allowance (33.13) % (18.08) % Change in tax rates 4.10 % (0.18) % US effects of foreign operations (0.07) % (0.04) % Deferred tax true-up (0.79) % (2.79) % Other 2.43 % (0.04) % Effective tax rate (0.07) % 0.00 % |
Schedule of deferred tax assets liabilities | September 30, 2023 2022 Deferred tax assets: Net operating losses $ 16,532,642 $ 10,045,027 Allowance for doubtful accounts 133,539 189,124 Stock-based compensation 6,766,029 3,982,495 Accrued expenses 382,321 4,806 Intangible book/tax basis difference 1,900,189 1,695,480 Other 10,436 — Total deferred tax assets, net 25,725,156 15,916,932 Less: reserve for allowance (25,237,534) (14,748,164) Total deferred tax assets, net of valuation allowance $ 487,622 $ 1,168,768 Deferred tax liabilities: Fixed assets book/ tax basis difference (22,606) (298,437) Operating right of use assets — (277) Debt discount (462,873) (870,054) Other (2,143) — Total deferred tax liabilities $ (487,622) $ (1,168,768) Total deferred tax liabilities, net $ — $ — |
BUSINESS - Offerings (Details)
BUSINESS - Offerings (Details) - USD ($) | 12 Months Ended | |||||
May 12, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 14, 2023 | Aug. 15, 2023 | May 10, 2023 | |
Common stock, issued | 65,620,151 | 56,381,209 | ||||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||
Proceeds from issuance of common stock | $ 8,724,855 | $ 1,250,000 | ||||
Issuance costs | $ 313,149 | $ 87,646 | ||||
2023 Secured Loan | ||||||
Common stock, par value (in dollars per share) | $ 0.0001 | |||||
Maximum borrowing capacity | $ 4,000,000 | |||||
Sales Agreement | ||||||
Common stock, issued | 3,109,843 | |||||
Common stock, par value (in dollars per share) | $ 0.0001 | |||||
Proceeds from issuance of common stock | $ 8,724,544 | |||||
Amount of placement agent's commission and related fees | 269,600 | |||||
Issuance costs | $ 105,253 | |||||
Sales Agreement | Maximum | ||||||
Proceeds from issuance of common stock | $ 50,000,000 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Segment reporting (Details) | 12 Months Ended |
Sep. 30, 2023 segment | |
Accounting Policies [Abstract] | |
Number of reportable segments | 1 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Cash (Details) - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
Accounting Policies [Abstract] | ||
Cash equivalents | $ 0 | $ 0 |
FDIC insurance Limit | $ 2,818,696 | $ 13,821,914 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Accounts receivable (Details) - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
Accounting Policies [Abstract] | ||
Allowance for doubtful accounts | $ 630,629 | $ 646,013 |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Concentration of credit risk (Details) - customer | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Sales Revenue | ||
Number of major customers | 0 | 0 |
Sales Revenue | Customer Concentration Risk | ||
Number of major customers | 2 | |
Sales Revenue | Customer Concentration Risk | Customer One | ||
Concentration risk, percentage | 14% | |
Sales Revenue | Customer Concentration Risk | Customer Two | ||
Concentration risk, percentage | 12% | |
Sales Revenue | Revenue from Rights Concentration Risk | ||
Number of major customers | 2 | |
Sales Revenue | Revenue from Rights Concentration Risk | Customer One | ||
Concentration risk, percentage | 15% | |
Sales Revenue | Revenue from Rights Concentration Risk | Customer Two | ||
Concentration risk, percentage | 11% | |
Sales Revenue | Revenue from Rights Concentration Risk | Direct and Programmatic Advertising including Sponsorships [Member] | ||
Concentration risk, percentage | 91% | |
Sales Revenue | Revenue from Rights Concentration Risk | Legacy and other business revenue | ||
Concentration risk, percentage | 9% | |
Accounts Receivable. | ||
Number of major customers | 0 | 0 |
Accounts Receivable. | Customer Concentration Risk | ||
Number of major customers | 1 | 3 |
Accounts Receivable. | Customer Concentration Risk | Three Customer | ||
Concentration risk, percentage | 49% | |
Accounts Receivable. | Customer Concentration Risk | Customer One | ||
Concentration risk, percentage | 18% | 21% |
Accounts Receivable. | Customer Concentration Risk | Customer Two | ||
Concentration risk, percentage | 17% | |
Accounts Receivable. | Customer Concentration Risk | Customer Three | ||
Concentration risk, percentage | 11% | |
Minimum | Sales Revenue | Customer Concentration Risk | ||
Concentration risk, percentage | 10% | |
Minimum | Sales Revenue | Revenue from Rights Concentration Risk | ||
Concentration risk, percentage | 10% | |
Maximum | Sales Revenue | Customer Concentration Risk | ||
Concentration risk, percentage | 10% | |
Maximum | Sales Revenue | Revenue from Rights Concentration Risk | ||
Concentration risk, percentage | 10% | |
Maximum | Accounts Receivable. | Customer Concentration Risk | ||
Concentration risk, percentage | 10% | 10% |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Long Lived assets (Details) | Sep. 30, 2023 USD ($) |
Threshold amount for capitalization of Property and equipment | $ 3,000 |
Minimum | |
Useful life | 2 years |
Maximum | |
Useful life | 9 years |
Loop players | |
Property and equipment, estimated useful lives | 3 years |
Equipment | |
Useful life | 5 years |
Equipment | Minimum | |
Property and equipment, estimated useful lives | 3 years |
Software | |
Property and equipment, estimated useful lives | 3 years |
SUMMARY OF SIGNIFICANT ACCOUN_9
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Fair Value Measurements (Details) | Sep. 30, 2023 USD ($) |
Financial Liabilities Fair Value Disclosure [Abstract] | |
Derivative liabilities | $ 0 |
SUMMARY OF SIGNIFICANT ACCOU_10
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Advertising costs (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Accounting Policies [Abstract] | ||
Advertising costs | $ 11,149,084 | $ 7,255,962 |
SUMMARY OF SIGNIFICANT ACCOU_11
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Revenue recognition (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Revenue | $ 31,642,293 | $ 30,832,796 |
Direct and Programmatic Advertising including Sponsorships [Member] | ||
Revenue | 28,740,623 | 26,060,885 |
Legacy and other business revenue | ||
Revenue | $ 2,901,670 | $ 4,771,911 |
Sales Revenue | Customer Concentration Risk | Customer One | ||
Concentration risk, percentage | 14% | |
Sales Revenue | Customer Concentration Risk | Customer Two | ||
Concentration risk, percentage | 12% | |
Sales Revenue | Revenue from Rights Concentration Risk | Customer One | ||
Concentration risk, percentage | 15% | |
Sales Revenue | Revenue from Rights Concentration Risk | Customer Two | ||
Concentration risk, percentage | 11% | |
Sales Revenue | Revenue from Rights Concentration Risk | Direct and Programmatic Advertising including Sponsorships [Member] | ||
Concentration risk, percentage | 91% | |
Sales Revenue | Revenue from Rights Concentration Risk | Legacy and other business revenue | ||
Concentration risk, percentage | 9% | |
Accounts Receivable. | Customer Concentration Risk | Three Customer | ||
Concentration risk, percentage | 49% | |
Accounts Receivable. | Customer Concentration Risk | Customer One | ||
Concentration risk, percentage | 18% | 21% |
Accounts Receivable. | Customer Concentration Risk | Customer Two | ||
Concentration risk, percentage | 17% | |
Accounts Receivable. | Customer Concentration Risk | Customer Three | ||
Concentration risk, percentage | 11% | |
Minimum | Sales Revenue | Customer Concentration Risk | ||
Concentration risk, percentage | 10% | |
Minimum | Sales Revenue | Revenue from Rights Concentration Risk | ||
Concentration risk, percentage | 10% | |
Maximum | Sales Revenue | Customer Concentration Risk | ||
Concentration risk, percentage | 10% | |
Maximum | Sales Revenue | Revenue from Rights Concentration Risk | ||
Concentration risk, percentage | 10% | |
Maximum | Accounts Receivable. | Customer Concentration Risk | ||
Concentration risk, percentage | 10% | 10% |
SUMMARY OF SIGNIFICANT ACCOU_12
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Net loss per share (Details) - shares | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Total common stock equivalents | 15,598,275 | 14,364,616 |
Options to purchase common stock | ||
Total common stock equivalents | 8,849,305 | 8,174,583 |
Warrants to purchase common stock | ||
Total common stock equivalents | 5,592,573 | 5,300,033 |
Restricted Stock Units (RSUs) | ||
Total common stock equivalents | 1,156,397 | 890,000 |
SUMMARY OF SIGNIFICANT ACCOU_13
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Employee retention credits (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Accounting Policies [Abstract] | ||
Employee retention credits | $ 645,919 | |
Restructuring Costs | $ 950,986 | $ 0 |
Estimate Of Reduction in Costs As A Percentage | 20% |
CONTENT ASSETS (Details)
CONTENT ASSETS (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Content assets - current | $ 2,218,894 | $ 745,633 |
License content asset - non current | 448,726 | 678,659 |
License content liability | 926,656 | |
License content liability - current | 489,157 | $ 1,092,819 |
License content liability in Accounts Payable | 229,499 | |
License content liability - non current | 208,000 | |
Payments for license content liabilities | 4,508,517 | |
Payable in 2024 | 399,157 | |
Payable in 2025 | 98,000 | |
Payable in 2026 | $ 110,000 | |
Minimum | ||
Useful life | 2 years | |
Maximum | ||
Useful life | 9 years | |
Licensed Content Assets | Minimum | ||
Useful life | 2 years | |
Licensed Content Assets | Maximum | ||
Useful life | 3 years | |
Internally Developed Content Assets | ||
Useful life | 3 years | |
License content asset - non current | $ 140,862 | |
Internally Developed Content Assets | Minimum | ||
Useful life | 2 years | |
Internally Developed Content Assets | Maximum | ||
Useful life | 3 years |
CONTENT ASSETS - Amortization e
CONTENT ASSETS - Amortization expense (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Amortization expense | $ 2,946,403 | $ 1,250,353 |
Licensed Content Assets | ||
Amortization expense | 2,882,106 | 1,236,933 |
Internally Developed Content Assets | ||
Amortization expense | $ 64,297 | $ 13,420 |
CONTENT ASSETS - Capitalized co
CONTENT ASSETS - Capitalized content assets (Details) | Sep. 30, 2023 USD ($) |
Fiscal Year 2024 | $ 2,291,754 |
Fiscal Year 2025 | 269,903 |
Fiscal Year 2026 | 105,965 |
Licensed Content Assets | |
Fiscal Year 2024 | 2,218,894 |
Fiscal Year 2025 | 210,463 |
Fiscal Year 2026 | 97,402 |
Internally Developed Content Assets | |
Fiscal Year 2024 | 72,860 |
Fiscal Year 2025 | 59,440 |
Fiscal Year 2026 | $ 8,563 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
Total property and equipment, gross | $ 4,193,204 | $ 2,366,801 |
Less: accumulated depreciation | (1,481,646) | (733,632) |
Total property and equipment, net | 2,711,558 | 1,633,169 |
Loop players | ||
Total property and equipment, gross | 2,536,937 | 1,259,402 |
Equipment | ||
Total property and equipment, gross | 801,301 | 703,341 |
Software | ||
Total property and equipment, gross | $ 854,966 | $ 404,058 |
PROPERTY AND EQUIPMENT - Deprec
PROPERTY AND EQUIPMENT - Depreciation (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
PROPERTY AND EQUIPMENT | ||
Depreciation expense | $ 891,058 | $ 229,661 |
INTANGIBLE ASSETS (Details)
INTANGIBLE ASSETS (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Total intangible assets, gross | $ 1,210,000 | $ 1,210,000 |
Less: accumulated amortization | (732,111) | (619,667) |
Total | (732,111) | (619,667) |
Total intangible assets, net | $ 477,889 | 590,333 |
Useful life | 4 years 2 months 12 days | |
Customer relationships | ||
Total intangible assets, gross | $ 1,012,000 | 1,012,000 |
Useful life | 9 years | |
Content library | ||
Total intangible assets, gross | $ 198,000 | $ 198,000 |
Useful life | 2 years |
INTANGIBLE ASSETS - Amortizatio
INTANGIBLE ASSETS - Amortization expense (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Useful life | 4 years 2 months 12 days | |
Amortization expense | $ 112,444 | $ 112,444 |
Intangible Assets, Net (Excluding Goodwill) | 477,889 | $ 590,333 |
Finite-Lived Intangible Assets, Amortization Expense, Next Rolling Twelve Months | 112,444 | |
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 | $ 28,113 |
OPERATING LEASES - Short and lo
OPERATING LEASES - Short and long term leases (Details) | Sep. 30, 2022 USD ($) |
Leases [Abstract] | |
Short term portion | $ 75,529 |
Total lease liability | $ 75,529 |
OPERATING LEASES - Lease expens
OPERATING LEASES - Lease expense (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Leases. | ||
Operating lease expense | $ 79,434 | $ 177,776 |
Short-term lease expense | 113,590 | 9,000 |
Total lease expense | $ 193,024 | $ 186,776 |
OPERATING LEASES (Details)
OPERATING LEASES (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Lease Detail Narrative [Abstract] | ||
Cash payments against lease liabilities | $ 77,929 | $ 184,480 |
Accretion on lease liability | $ 2,737 | $ 17,379 |
Lease term | 1 year | |
Options to renew lease | 1 year | |
Option to terminate | 30 days |
ACCOUNTS PAYABLE AND ACCRUED _3
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Details) - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
Accounts Payable And Accrued Expenses. | ||
Accounts payable | $ 4,978,920 | $ 7,453,801 |
Performance bonuses | 425,321 | |
Interest payable | 1,262,000 | 2,970,000 |
Professional fees | 800,165 | 344,309 |
Marketing | 449,944 | 505,169 |
Commissions | 552,000 | 602,970 |
Insurance liabilities | 175,094 | 348,150 |
Other accrued liabilities | 307,135 | 424,954 |
Accrued liabilities | 3,546,338 | 5,620,873 |
Accrued royalties and revenue share | 4,930,329 | 4,559,088 |
Total accounts payable and accrued expenses | $ 13,455,587 | $ 17,633,762 |
DEBT - Lines of Credit (Details
DEBT - Lines of Credit (Details) - USD ($) | 12 Months Ended | |||||
Sep. 30, 2023 | Sep. 30, 2022 | May 10, 2023 | Oct. 27, 2022 | Jul. 29, 2022 | May 13, 2022 | |
Line of Credit Facility [Line Items] | ||||||
Warrants issued for severance | $ 276,610 | |||||
Related party | ||||||
Line of Credit Facility [Line Items] | ||||||
Line of credit, noncurrent | 1,959,693 | $ 2,575,753 | ||||
Line of credit, Unpaid Principal Balance | 2,266,733 | 4,022,986 | ||||
Nonrelated party | ||||||
Line of Credit Facility [Line Items] | ||||||
Non-revolving line of credit | 5,110,018 | |||||
Line of credit, noncurrent | 475,523 | 4,524,985 | ||||
Line of credit, Unpaid Principal Balance | 6,830,914 | 6,743,560 | ||||
Non-revolving line of credit | ||||||
Line of Credit Facility [Line Items] | ||||||
Non-revolving line of credit | 2,124,720 | |||||
Line of credit, noncurrent | 475,523 | 1,494,469 | ||||
Non revolving lines of credit, May 10 2023 | ||||||
Line of Credit Facility [Line Items] | ||||||
Maximum borrowing capacity | $ 4,000,000 | |||||
Non revolving lines of credit, May 10 2023 | Related party | ||||||
Line of Credit Facility [Line Items] | ||||||
Line of credit, noncurrent | 1,959,693 | |||||
Line of credit, Unpaid Principal Balance | $ 2,266,733 | |||||
Interest rate | 12% | |||||
Maturity date | May 10, 2025 | |||||
Warrants issued for severance | $ 209,398 | |||||
Secured loan amount | 4,000,000 | |||||
Non revolving lines of credit, May 10 2023 | Nonrelated party | ||||||
Line of Credit Facility [Line Items] | ||||||
Line of credit, noncurrent | 475,523 | |||||
Line of credit, Unpaid Principal Balance | $ 900,000 | |||||
Interest rate | 12% | |||||
Maturity date | May 10, 2025 | |||||
Warrants issued for severance | $ 83,142 | |||||
Secured loan amount | 4,000,000 | |||||
Non-revolving lines of credit, April 25, 2022 | Related party | ||||||
Line of Credit Facility [Line Items] | ||||||
Line of credit, noncurrent | 2,575,753 | |||||
Line of credit, Unpaid Principal Balance | $ 4,022,986 | |||||
Interest rate | 12% | |||||
Maturity date | Oct. 25, 2023 | |||||
Warrants issued for severance | $ 383,141 | |||||
Secured loan amount | 4,022,986 | |||||
Non-revolving lines of credit, May 13, 2022 | ||||||
Line of Credit Facility [Line Items] | ||||||
Maximum borrowing capacity | $ 2,200,000 | |||||
Non-revolving lines of credit, May 13, 2022 | Nonrelated party | ||||||
Line of Credit Facility [Line Items] | ||||||
Non-revolving line of credit | 2,124,720 | |||||
Line of credit, noncurrent | 1,494,469 | |||||
Line of credit, Unpaid Principal Balance | $ 2,200,000 | $ 2,200,000 | ||||
Interest rate | 12% | 12% | ||||
Maturity date | Nov. 13, 2023 | Nov. 13, 2023 | ||||
Warrants issued for severance | $ 314,286 | $ 314,286 | ||||
Secured loan amount | 2,200,000 | 2,200,000 | ||||
Revolving line of credit | ||||||
Line of Credit Facility [Line Items] | ||||||
Non-revolving line of credit | 2,985,298 | |||||
Line of credit, noncurrent | 3,030,516 | |||||
Revolving line of credit, July 29, 2022 | ||||||
Line of Credit Facility [Line Items] | ||||||
Maximum borrowing capacity | $ 6,000,000 | $ 4,000,000 | ||||
Revolving line of credit, July 29, 2022 | Nonrelated party | ||||||
Line of Credit Facility [Line Items] | ||||||
Non-revolving line of credit | 2,985,298 | |||||
Line of credit, noncurrent | 3,030,516 | |||||
Line of credit, Unpaid Principal Balance | $ 3,730,914 | $ 4,543,560 | ||||
Loan interest rate | 4% | 4% | ||||
Maturity date | Jul. 29, 2024 | Jul. 29, 2024 | ||||
Maximum borrowing capacity | $ 6,000,000 | $ 6,000,000 |
DEBT - Line of Credit - Narrati
DEBT - Line of Credit - Narrative (Details) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 14, 2023 USD ($) $ / shares shares | Dec. 13, 2023 USD ($) | Nov. 13, 2023 USD ($) payment $ / shares | Sep. 14, 2023 USD ($) $ / shares shares | Sep. 12, 2023 USD ($) $ / shares shares | Aug. 29, 2023 | May 31, 2023 USD ($) | May 10, 2023 USD ($) $ / shares shares | May 09, 2023 | Dec. 14, 2022 | Dec. 13, 2022 | Sep. 07, 2022 | Jul. 29, 2022 USD ($) $ / shares shares | May 13, 2022 USD ($) $ / shares shares | Apr. 25, 2022 USD ($) $ / shares shares | Sep. 30, 2023 USD ($) $ / shares shares | Sep. 30, 2022 USD ($) $ / shares | Dec. 15, 2023 USD ($) | Dec. 08, 2023 shares | Sep. 15, 2023 USD ($) | Aug. 15, 2023 $ / shares | Feb. 23, 2023 USD ($) | Oct. 27, 2022 USD ($) | Apr. 13, 2022 USD ($) | Feb. 23, 2022 USD ($) | |
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Shares to be issued for loan conversion | shares | 6,005,487 | ||||||||||||||||||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||||||||||||||||||
Principal amount | $ 374,000 | ||||||||||||||||||||||||
Exercise price (in dollars per share) | $ / shares | $ 5.74 | $ 5.82 | |||||||||||||||||||||||
Allocated fair value of warrants as additional debt discount | $ 5,592,573 | $ 5,300,033 | |||||||||||||||||||||||
Aggregate loan amount | 9,097,647 | ||||||||||||||||||||||||
Long-term Debt | 7,545,234 | ||||||||||||||||||||||||
Prime rate | Maximum | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Loan interest rate | 4% | ||||||||||||||||||||||||
Prime rate | Minimum | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Loan interest rate | 0% | ||||||||||||||||||||||||
Excel Non-Revolving Loan | Excel May 2023 Secured Line of Credit Note Conversion Agreement | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Conversion price | $ / shares | $ 0.80 | ||||||||||||||||||||||||
RAT Non-Revolving Loan | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Maximum borrowing capacity | $ 2,200,000 | ||||||||||||||||||||||||
Line of Credit, Interest rate | 12% | ||||||||||||||||||||||||
Line of credit | 2,300,899 | 2,301,260 | |||||||||||||||||||||||
Number of aggregate warrants | shares | 209,522 | ||||||||||||||||||||||||
Exercise price (in dollars per share) | $ / shares | $ 5.25 | ||||||||||||||||||||||||
Interest expense | 894,251 | 346,847 | |||||||||||||||||||||||
Days until maturity | 18 months | ||||||||||||||||||||||||
Non-Revolving Line of Credit Loan Agreement Amendment | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Ratio of net proceeds | 33.33 | ||||||||||||||||||||||||
Period for which shares has to be locked | 12 months | ||||||||||||||||||||||||
Line of credit, Accrued interest | $ 220,000 | $ 132,000 | |||||||||||||||||||||||
Line of Credit, Periodic payment | 220,000 | ||||||||||||||||||||||||
Amount of consideration to be paid to extend the credit maturity | $ 22,000 | ||||||||||||||||||||||||
Number of monthly payments | payment | 9 | ||||||||||||||||||||||||
2023 Secured Loan | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | ||||||||||||||||||||||||
Conversion price | $ / shares | $ 0.80 | ||||||||||||||||||||||||
Maximum borrowing capacity | $ 4,000,000 | ||||||||||||||||||||||||
Remaining borrowing capacity | $ 0 | ||||||||||||||||||||||||
Line of Credit, Interest rate | 12% | ||||||||||||||||||||||||
Line of credit | $ 2,328,617 | $ 2,328,617 | $ 900,000 | $ 934,200 | |||||||||||||||||||||
Number of Warrants for Each Investor | shares | 209,398 | ||||||||||||||||||||||||
Number of aggregate warrants | shares | 209,398 | 369,517 | 292,540 | ||||||||||||||||||||||
Exercise price (in dollars per share) | $ / shares | $ 4.33 | $ 4.33 | |||||||||||||||||||||||
Aggregate loan amount | $ 2,266,733 | ||||||||||||||||||||||||
Days until maturity | 24 months | ||||||||||||||||||||||||
2023 Secured Loan | Excel May 2023 Secured Line of Credit Note Conversion Agreement | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Shares to be issued for loan conversion | shares | 2,910,771 | 2,910,771 | |||||||||||||||||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | |||||||||||||||||||||||
Conversion price | $ / shares | $ 0.80 | ||||||||||||||||||||||||
Excel $2.2M Line of Credit | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Line of Credit, Interest rate | 10.50% | ||||||||||||||||||||||||
Days until maturity | 90 days | ||||||||||||||||||||||||
Non-revolving line of credit loan agreement | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Number of aggregate warrants | shares | 209,398 | ||||||||||||||||||||||||
Exercise price (in dollars per share) | $ / shares | $ 1 | ||||||||||||||||||||||||
Aggregate loan amount | $ 2,266,733 | ||||||||||||||||||||||||
Non-revolving line of credit loan agreement | Amendment 1 | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Line of credit | $ 0 | ||||||||||||||||||||||||
Non-revolving line of credit loan agreement | Maximum | Amendment 1 | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Days until maturity | 27 months | ||||||||||||||||||||||||
Non-revolving line of credit loan agreement | Minimum | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Days until maturity | 18 months | ||||||||||||||||||||||||
Excel secured line of credit agreement | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Maximum borrowing capacity | $ 2,266,733 | ||||||||||||||||||||||||
Excel secured line of credit agreement | Maximum | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Extend maturity period | 120 days | ||||||||||||||||||||||||
Excel secured line of credit agreement | Minimum | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Extend maturity period | 90 days | ||||||||||||||||||||||||
GemCap Revolving Line of Credit | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Maximum borrowing capacity | $ 4,000,000 | $ 6,000,000 | |||||||||||||||||||||||
Line of credit, Accordion feature | $ 10,000,000 | ||||||||||||||||||||||||
Number of aggregate warrants | shares | 296,329 | ||||||||||||||||||||||||
Exercise price (in dollars per share) | $ / shares | $ 5.25 | ||||||||||||||||||||||||
Cash payments | $ 22,000 | ||||||||||||||||||||||||
Percentage of outstanding principal amount | 1% | ||||||||||||||||||||||||
Long-term Debt | 3,757,074 | 4,587,255 | |||||||||||||||||||||||
Interest expense | 1,379,673 | 225,345 | |||||||||||||||||||||||
Excel Family Partners, LLLP | Excel Non-Revolving Loan | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Loan term | 18 months | ||||||||||||||||||||||||
Shares to be issued for loan conversion | shares | 6,005,487 | ||||||||||||||||||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | ||||||||||||||||||||||||
Conversion price | $ / shares | $ 0.74 | ||||||||||||||||||||||||
Maximum borrowing capacity | $ 4,022,986 | $ 1,500,000 | $ 2,000,000 | $ 1,500,000 | |||||||||||||||||||||
Maximum amount outstanding | $ 4,444,060 | ||||||||||||||||||||||||
Remaining borrowing capacity | $ 0 | ||||||||||||||||||||||||
Line of Credit, Interest rate | 12% | ||||||||||||||||||||||||
Proceeds from Line of credit | $ 2,000,000 | ||||||||||||||||||||||||
Line of credit | 0 | 4,226,181 | |||||||||||||||||||||||
Number of aggregate warrants | shares | 383,141 | ||||||||||||||||||||||||
Exercise price (in dollars per share) | $ / shares | $ 5.25 | ||||||||||||||||||||||||
Interest expense | 1,304,807 | 820,051 | |||||||||||||||||||||||
Days until maturity | 25 months | 24 months | 24 months | 18 months | 18 months | ||||||||||||||||||||
Excel Family Partners, LLLP | Excel Non-Revolving Loan | Amendment 1 | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Expiration period | 24 months | ||||||||||||||||||||||||
Days until maturity | 24 months | ||||||||||||||||||||||||
Excel Family Partners, LLLP | Excel Non-Revolving Loan | Amendment 2 | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Days until maturity | 25 months | ||||||||||||||||||||||||
Excel Family Partners, LLLP | 2023 Secured Loan | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Maximum borrowing capacity | $ 2,650,000 | ||||||||||||||||||||||||
Line of credit | 3,214,769 | 0 | |||||||||||||||||||||||
Number of aggregate warrants | shares | 209,398 | ||||||||||||||||||||||||
Interest expense | 144,392 | 0 | |||||||||||||||||||||||
Excel Family Partners, LLLP | Excel $2.2M Line of Credit | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Interest rate | 10.50% | ||||||||||||||||||||||||
Maximum borrowing capacity | $ 2,200,000 | 2,200,000 | |||||||||||||||||||||||
Line of credit | 0 | 0 | |||||||||||||||||||||||
Long-term Debt | 0 | 0 | |||||||||||||||||||||||
Interest expense | $ 66,733 | $ 0 | |||||||||||||||||||||||
Days until maturity | 90 days | ||||||||||||||||||||||||
Excel Family Partners, LLLP | Excel $2.2M Line of Credit | Maximum | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Extend maturity period | 120 days | ||||||||||||||||||||||||
Excel Family Partners, LLLP | Excel $2.2M Line of Credit | Minimum | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Extend maturity period | 90 days | ||||||||||||||||||||||||
Excel Family Partners, LLLP | Non-revolving line of credit loan agreement | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Maximum borrowing capacity | $ 2,650,000 | ||||||||||||||||||||||||
Excel Family Partners, LLLP | Excel secured line of credit agreement | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Remaining borrowing capacity | $ 0 | ||||||||||||||||||||||||
Eagle Investment Group, LLC. | GemCap Revolving Line of Credit | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Number of Warrants for Each Investor | shares | 1 | ||||||||||||||||||||||||
Number of aggregate warrants | shares | 191,570 | ||||||||||||||||||||||||
Subordinated Lenders [Member] | GemCap Revolving Line of Credit | |||||||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||||||
Number of aggregate warrants | shares | 104,759 |
DEBT - Interest Expenses of Lin
DEBT - Interest Expenses of Lines of Credit (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Debt Instrument [Line Items] | ||
Amortization of debt discounts | $ 6,721,476 | $ 2,691,617 |
Convertible debentures. | ||
Debt Instrument [Line Items] | ||
Interest expense | 1,363,314 | 919,372 |
Amortization of debt discounts | 2,426,544 | 2,691,617 |
Total | $ 3,789,858 | $ 3,610,989 |
DEBT - Maturities (Details)
DEBT - Maturities (Details) | Sep. 30, 2023 USD ($) |
Line of Credit Facility [Abstract] | |
2024 | $ 5,930,914 |
2025 | 3,166,733 |
Lines of credit, related and non-related party | 9,097,647 |
Less: Debt discount on lines of credit payable | (1,552,413) |
Total Lines of credit payable, related and non-related party, net | $ 7,545,234 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) | 12 Months Ended |
Sep. 30, 2023 USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | |
Loss contingencies | $ 0 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | 12 Months Ended | ||||||||||||||||||||
Dec. 14, 2023 | Sep. 14, 2023 | Sep. 12, 2023 | Aug. 29, 2023 | May 31, 2023 | May 10, 2023 | May 09, 2023 | Dec. 14, 2022 | Dec. 13, 2022 | Jul. 29, 2022 | Apr. 25, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 15, 2023 | Dec. 08, 2023 | Sep. 15, 2023 | Aug. 15, 2023 | Feb. 23, 2023 | Oct. 27, 2022 | Apr. 13, 2022 | Feb. 23, 2022 | |
Common stock subscribed for settlement of obligations | 6,005,487 | ||||||||||||||||||||
Aggregate loan amount | $ 9,097,647 | ||||||||||||||||||||
Exercise price (in dollars per share) | $ 5.74 | $ 5.82 | |||||||||||||||||||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||||||||||||||
Non-revolving lines of credit, April 25, 2022 | Excel May 2023 Secured Line of Credit Note Conversion Agreement | |||||||||||||||||||||
Conversion price | $ 0.80 | ||||||||||||||||||||
2023 Secured Loan | |||||||||||||||||||||
Maximum borrowing capacity | $ 4,000,000 | ||||||||||||||||||||
Days until maturity | 24 months | ||||||||||||||||||||
Line of Credit, Interest rate | 12% | ||||||||||||||||||||
Remaining borrowing capacity | $ 0 | ||||||||||||||||||||
Conversion price | $ 0.80 | ||||||||||||||||||||
Aggregate loan amount | $ 2,266,733 | ||||||||||||||||||||
Number of aggregate warrants | 209,398 | 369,517 | 292,540 | ||||||||||||||||||
Exercise price (in dollars per share) | $ 4.33 | $ 4.33 | |||||||||||||||||||
Number of warrants for each investor | 209,398 | ||||||||||||||||||||
Common stock, par value (in dollars per share) | $ 0.0001 | ||||||||||||||||||||
Line of credit | $ 2,328,617 | $ 2,328,617 | $ 900,000 | $ 934,200 | |||||||||||||||||
2023 Secured Loan | Excel May 2023 Secured Line of Credit Note Conversion Agreement | |||||||||||||||||||||
Common stock subscribed for settlement of obligations | 2,910,771 | 2,910,771 | |||||||||||||||||||
Conversion price | $ 0.80 | ||||||||||||||||||||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | |||||||||||||||||||
Excel $2.2M Line of Credit | |||||||||||||||||||||
Days until maturity | 90 days | ||||||||||||||||||||
Line of Credit, Interest rate | 10.50% | ||||||||||||||||||||
Excel Non-Revolving Loan | |||||||||||||||||||||
Remaining borrowing capacity | $ 0 | ||||||||||||||||||||
Common stock subscribed for settlement of obligations | 6,005,487 | ||||||||||||||||||||
Conversion price | $ 0.74 | ||||||||||||||||||||
Common stock, par value (in dollars per share) | $ 0.0001 | ||||||||||||||||||||
Excel secured line of credit agreement | |||||||||||||||||||||
Maximum borrowing capacity | $ 2,266,733 | ||||||||||||||||||||
Excel secured line of credit agreement | Maximum | |||||||||||||||||||||
Extend maturity period | 120 days | ||||||||||||||||||||
Excel secured line of credit agreement | Minimum | |||||||||||||||||||||
Extend maturity period | 90 days | ||||||||||||||||||||
GemCap Revolving Line of Credit | |||||||||||||||||||||
Maximum borrowing capacity | $ 4,000,000 | $ 6,000,000 | |||||||||||||||||||
Number of aggregate warrants | 296,329 | ||||||||||||||||||||
Exercise price (in dollars per share) | $ 5.25 | ||||||||||||||||||||
Interest expense | $ 1,379,673 | $ 225,345 | |||||||||||||||||||
Eagle Investment Group, LLC | GemCap Revolving Line of Credit | |||||||||||||||||||||
Number of aggregate warrants | 191,570 | ||||||||||||||||||||
Number of warrants for each investor | 1 | ||||||||||||||||||||
Excel Family Partners, LLLP | Non-revolving lines of credit, April 25, 2022 | |||||||||||||||||||||
Maximum borrowing capacity | $ 4,022,986 | $ 1,500,000 | $ 2,000,000 | $ 1,500,000 | |||||||||||||||||
Days until maturity | 25 months | 24 months | 24 months | 18 months | 18 months | ||||||||||||||||
Line of Credit, Interest rate | 12% | ||||||||||||||||||||
Proceeds from Line of credit | $ 2,000,000 | ||||||||||||||||||||
Maximum amount outstanding | 4,444,060 | ||||||||||||||||||||
Remaining borrowing capacity | $ 0 | ||||||||||||||||||||
Loan term | 18 months | ||||||||||||||||||||
Common stock subscribed for settlement of obligations | 6,005,487 | ||||||||||||||||||||
Conversion price | $ 0.74 | ||||||||||||||||||||
Number of aggregate warrants | 383,141 | ||||||||||||||||||||
Exercise price (in dollars per share) | $ 5.25 | ||||||||||||||||||||
Interest expense | 1,304,807 | 820,051 | |||||||||||||||||||
Common stock, par value (in dollars per share) | $ 0.0001 | ||||||||||||||||||||
Line of credit | 0 | 4,226,181 | |||||||||||||||||||
Excel Family Partners, LLLP | Non-revolving lines of credit, April 25, 2022 | Amendment 2 | |||||||||||||||||||||
Days until maturity | 25 months | ||||||||||||||||||||
Excel Family Partners, LLLP | Non-revolving lines of credit, April 25, 2022 | Amendment 1 | |||||||||||||||||||||
Days until maturity | 24 months | ||||||||||||||||||||
Excel Family Partners, LLLP | 2023 Secured Loan | |||||||||||||||||||||
Maximum borrowing capacity | $ 2,650,000 | ||||||||||||||||||||
Number of aggregate warrants | 209,398 | ||||||||||||||||||||
Interest expense | 144,392 | 0 | |||||||||||||||||||
Line of credit | 3,214,769 | 0 | |||||||||||||||||||
Proceeds from Secured Lines of Credit | $ 2,266,733 | ||||||||||||||||||||
Excel Family Partners, LLLP | Excel $2.2M Line of Credit | |||||||||||||||||||||
Maximum borrowing capacity | $ 2,200,000 | 2,200,000 | |||||||||||||||||||
Days until maturity | 90 days | ||||||||||||||||||||
Interest rate | 10.50% | ||||||||||||||||||||
Interest expense | 66,733 | 0 | |||||||||||||||||||
Line of credit | 0 | 0 | |||||||||||||||||||
Excel Family Partners, LLLP | Excel $2.2M Line of Credit | Maximum | |||||||||||||||||||||
Extend maturity period | 120 days | ||||||||||||||||||||
Excel Family Partners, LLLP | Excel $2.2M Line of Credit | Minimum | |||||||||||||||||||||
Extend maturity period | 90 days | ||||||||||||||||||||
Excel Family Partners, LLLP | Excel secured line of credit agreement | |||||||||||||||||||||
Remaining borrowing capacity | $ 0 | ||||||||||||||||||||
Five Hundred Limited | |||||||||||||||||||||
Amount paid for programming services | $ 394,300 | $ 413,469 |
STOCKHOLDERS EQUITY DEFICIT (De
STOCKHOLDERS EQUITY DEFICIT (Details) | 12 Months Ended | |||||
Sep. 15, 2023 USD ($) | May 12, 2023 USD ($) $ / shares | Sep. 26, 2022 | Sep. 30, 2023 USD ($) $ / shares shares | Sep. 30, 2022 USD ($) $ / shares shares | Aug. 15, 2023 $ / shares shares | |
Reverse stock split | 3 | |||||
Common stock, shares authorized | 150,000,000 | 150,000,000 | ||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||
Proceeds from issuance of common stock | $ | $ 8,724,855 | $ 1,250,000 | ||||
Common stock, shares issues | 65,620,151 | 56,381,209 | ||||
Common stock, shares outstanding | 65,620,151 | 56,381,209 | ||||
Shares issued upon exercise of options (in shares) | 37,462 | |||||
Payment in kind interest stock issuance | $ | $ 177,000 | $ 177,000 | ||||
Amount of issuance costs and underwriters discount | $ | $ 809,905 | |||||
Exercised | 37,462 | |||||
Shares to be issued for loan conversion | 6,005,487 | |||||
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures | 6,757 | |||||
Description of reverse stock split | 1 for 3 reverse stock split of our Common stock became effective | |||||
Series A preferred stock | ||||||
Preferred stock, shares authorized | 3,333,334 | |||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.0001 | |||||
Series B preferred stock | ||||||
Preferred stock, shares authorized | 3,333,334 | |||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.0001 | |||||
Conversion of shares | 200,000 | |||||
Non-revolving line of credit | ||||||
Value of loan conversion | $ | $ 4,444,060 | |||||
Maximum | ||||||
Common stock, shares authorized | 150,000,000 | |||||
Minimum | ||||||
Common stock, shares authorized | 105,555,556 | |||||
Sales Agreement | ||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | |||||
Proceeds from issuance of common stock | $ | 8,724,544 | |||||
Amount of placement agent's commission and related fees | $ | $ 269,600 | |||||
Common stock, shares issues | 3,109,843 | |||||
Number of shares issued | 3,109,843 | |||||
Sales Agreement | Maximum | ||||||
Proceeds from issuance of common stock | $ | $ 50,000,000 | |||||
ATM | ||||||
Shares issued, value | $ | $ 41,000,000 | |||||
Initial Public Offering [Member] | ||||||
Number of shares issued, value | $ | $ 13,163,500 | |||||
Amount of issuance costs and underwriters discount | $ | $ 2,274,335 | |||||
Common Stock | ||||||
Number of shares issued | 37,462 | |||||
Shares issued upon exercise of options (in shares) | 37,462 | |||||
Payment in kind interest stock issuance | $ | $ 2 | |||||
Payment in kind interest stock issuance (in shares) | 23,151 | 23,151 | ||||
Conversion of series convertible preferred to common stock (in shares) | 6,666,666 | |||||
Conversion of shares | 6,666,666 | |||||
Number of shares issued in connection with the exercise of warrants. | 578,847 | |||||
Exercised | 37,462 | |||||
Shares to be issued for loan conversion | 1,988,266 | |||||
Value of loan conversion | $ | $ 5,313,352 | |||||
Common Stock | Initial Public Offering [Member] | ||||||
Number of shares issued | 2,634,145 | |||||
Preferred Stock | Series B preferred stock | ||||||
Conversion of series convertible preferred to common stock (in shares) | (200,000) | |||||
Board member | Common Stock | ||||||
Number of shares issued | 55,329 | |||||
Shares issued, value | $ | $ 141,000 |
STOCK OPTIONS, RESTRICTED STO_3
STOCK OPTIONS, RESTRICTED STOCK UNITS (RSUs) AND WARRANTS - Stock option activity (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||
Outstanding at the beginning | 8,174,563 | |
Grants | 839,996 | |
Exercised | (37,462) | |
Forfeited | (127,792) | |
Outstanding at the end | 8,849,305 | 8,174,563 |
Exercisable | 7,348,076 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | ||
Outstanding at the beginning | $ 3.78 | |
Grants | 4.59 | |
Exercised | 1.71 | |
Forfeited | 5.81 | |
Outstanding at the end | 3.84 | $ 3.78 |
Exercisable | $ 3.64 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||
Weighted average remaining contractual term, outstanding | 6 years 4 months 6 days | 8 years 18 days |
Exercisable | 5 years 9 months 25 days | |
Outstanding at the beginning | $ 91,888,491 | |
Outstanding at the end | $ 91,888,491 |
STOCK OPTIONS, RESTRICTED STO_4
STOCK OPTIONS, RESTRICTED STOCK UNITS (RSUs) AND WARRANTS - Stock options (Details) - $ / shares | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Share-based Payment Arrangement, Additional Disclosure [Abstract] | ||
Exercise price | $ 3.84 | $ 3.78 |
Number of options | 8,849,305 | 8,174,563 |
Weighted average remaining life in years remaining life in years | 6 years 4 months 6 days | 8 years 18 days |
Options exercisable number of options | 7,348,076 |
STOCK OPTIONS, RESTRICTED STO_5
STOCK OPTIONS, RESTRICTED STOCK UNITS (RSUs) AND WARRANTS - Fair value of options (Details) | 12 Months Ended |
Sep. 30, 2023 $ / shares | |
Share-based Payment Arrangement, Additional Disclosure [Abstract] | |
Weighted average fair value of options granted | $ 4.59 |
Expected life | 5 years 10 months 17 days |
Risk-free interest rate | 3.97% |
Expected volatility | 52.30% |
STOCK OPTIONS, RESTRICTED STO_6
STOCK OPTIONS, RESTRICTED STOCK UNITS (RSUs) AND WARRANTS - Restricted Stock Units (Details) - USD ($) | 12 Months Ended | |||||
Oct. 03, 2023 | Jul. 01, 2023 | Jan. 03, 2023 | Sep. 22, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Weighted Average Remaining Contractual Term | ||||||
Weighted average remaining contractual term, outstanding | 6 years 4 months 6 days | 8 years 18 days | ||||
Restricted Stock Units | ||||||
Restricted Stock Units | ||||||
Outstanding beginning of period | 890,000 | |||||
Grants | 54,393 | 212,004 | 890,000 | 266,397 | ||
Vested | 130,464 | |||||
Exercised | (295,643) | |||||
Outstanding end of period | 860,754 | 890,000 | ||||
Weighted Average Fair Value | ||||||
Outstanding beginning of period | $ 5 | |||||
Grants | 5.45 | |||||
Vested | 4.52 | |||||
Outstanding end of period | $ 5.30 | $ 5 | ||||
Aggregate Intrinsic Value | ||||||
Outstanding beginning of period | $ 442,330 | |||||
Grants | 105,366 | |||||
Vested | 119,901 | |||||
Outstanding end of period | $ 427,795 | $ 442,330 | ||||
Total pretax intrinsic value | $ 0.50 | $ 4.46 |
STOCK OPTIONS, RESTRICTED STO_7
STOCK OPTIONS, RESTRICTED STOCK UNITS (RSUs) AND WARRANTS - Changes in warrants outstanding (Details) - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
Share-based Payment Arrangement, Additional Disclosure [Abstract] | ||
Exercise price (in dollars per share) | $ 5.74 | $ 5.82 |
Number outstanding | $ 5,592,573 | $ 5,300,033 |
STOCK OPTIONS, RESTRICTED STO_8
STOCK OPTIONS, RESTRICTED STOCK UNITS (RSUs) AND WARRANTS - Warrant activity (Details) | 12 Months Ended |
Sep. 30, 2023 USD ($) $ / shares shares | |
Number of shares | |
Outstanding at beginning | $ | $ 5,300,033 |
Issued | shares | 292,540 |
Outstanding at ending | $ | $ 5,592,573 |
Weighted average exercise price per share | |
Outstanding at beginning | $ 5.82 |
Issued | 4.43 |
Outstanding at ending | $ 5.74 |
STOCK OPTIONS, RESTRICTED STO_9
STOCK OPTIONS, RESTRICTED STOCK UNITS (RSUs) AND WARRANTS - Fair value of warrants (Details) | Sep. 30, 2023 $ / shares |
Weighted average fair value of warrants granted | $ 4.33 |
Minimum | |
Warrant term | 2 years 9 months 14 days |
Minimum | Risk-free interest rate | |
Warrants outstanding, measurement input | 4.56 |
Minimum | Expected volatility | |
Warrants outstanding, measurement input | 47.63 |
STOCK OPTIONS, RESTRICTED ST_10
STOCK OPTIONS, RESTRICTED STOCK UNITS (RSUs) AND WARRANTS (Details) - USD ($) | 12 Months Ended | |||||
Oct. 03, 2023 | Jul. 01, 2023 | Jan. 03, 2023 | Sep. 22, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Value of shares issued | $ 8,594,779 | $ 8,988,681 | ||||
Amount of total compensation cost related to nonvested awards not yet recognized | $ 3,881,303 | |||||
Weighted average period over which expense is expected to be recognized | 36 months 9 days | |||||
Stock-based compensation expense | $ 6,326,055 | $ 8,889,474 | ||||
Number of warrants issued | 292,540 | |||||
Warrants issued for severance | $ 276,610 | |||||
Amount of debt discount and amortized as interest expense | $ 447,897 | |||||
Options | ||||||
Number of options issued | 839,996 | |||||
Stock price (in dollars per share) | $ 0.50 | $ 4.46 | ||||
Price per option (in dollars per share) | $ 4.59 | |||||
Amount of total compensation cost related to nonvested awards not yet recognized | $ 4,561,372 | |||||
Weighted average period over which expense is expected to be recognized | 26 months 24 days | |||||
Restricted Stock Units | ||||||
Vesting rights, percentage | 100% | |||||
Grants | 54,393 | 212,004 | 890,000 | 266,397 | ||
Stock price (in dollars per share) | $ 2.39 | $ 6.23 | $ 5 | |||
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Vested in Period | 130,464 | |||||
Stock-based compensation expense | $ 1,755,995 | $ 27,356 | ||||
Restricted Stock Units | Tranche One | ||||||
Vesting rights, percentage | 25% | 25% | ||||
Initial vestment of shares | 1 year | |||||
Restricted Stock Units | Tranche Two | ||||||
Vesting rights, percentage | 100% | |||||
Vesting period | 3 years | 3 years | ||||
Grants | 81,540 |
INCOME TAX - Components of inco
INCOME TAX - Components of income loss before provision (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | ||
Domestic Operations | $ (31,452,978) | $ (29,123,800) |
Foreign Operations | (492,189) | (356,324) |
Total | $ (31,945,167) | $ (29,480,124) |
INCOME TAX - Provision for inco
INCOME TAX - Provision for income tax (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Current: | ||
State | $ 18,512 | $ (676) |
Total Current provision (benefit) | 18,512 | (676) |
Total provision (benefit) | $ 18,512 | $ (676) |
INCOME TAX -Effective tax rate
INCOME TAX -Effective tax rate differs from the U.S. income tax rate (Details) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | ||
U.S. federal statutory rate | 21% | 21% |
State income taxes, net of federal benefit | 7.62% | 1.65% |
Goodwill impairment | (1.40%) | |
Non-deductible items | (1.23%) | (0.12%) |
Change in valuation allowance | (33.13%) | (18.08%) |
Change in tax rates | 4.10% | (0.18%) |
US effects of foreign operations | (0.07%) | (0.04%) |
Deferred tax true-up | (0.79%) | (2.79%) |
Other | 2.43% | (0.04%) |
Effective tax rate | (0.07%) | 0% |
INCOME TAX - Deferred tax asset
INCOME TAX - Deferred tax assets (Details) - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
Deferred tax assets: | ||
Net operating losses | $ 16,532,642 | $ 10,045,027 |
Allowance for doubtful accounts | 133,539 | 189,124 |
Stock-based compensation | 6,766,029 | 3,982,495 |
Accrued expenses | 382,321 | 4,806 |
Amortization of debt discount | 1,900,189 | 1,695,480 |
Intangible book/tax basis difference | 10,436 | |
Total deferred tax assets, net | 25,725,156 | 15,916,932 |
Less: reserve for allowance | (25,237,534) | (14,748,164) |
Total deferred tax assets, net of valuation allowance | 487,622 | 1,168,768 |
Deferred tax liabilities: | ||
Fixed assets book/tax basis differences | (22,606) | (298,437) |
Operating right of use assets | (277) | |
Debt discount | (462,873) | (870,054) |
Other | (2,143) | |
Total deferred tax liabilities, net | (487,622) | (1,168,768) |
Total deferred tax liabilities, net of valuation allowance | $ 0 | $ 0 |
INCOME TAX (Details)
INCOME TAX (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Income tax (expense)/benefit | $ (18,512) | $ 676 |
U.S. federal statutory rate | 21% | 21% |
Net operating loss carryforwards | $ 59,900,000 | |
Valuation allowance | 10,500,000 | |
Federal | ||
NOL carryforwards, not subject to expiration | 58,300,000 | |
Federal | Tax Year 2036 And 2037 | ||
NOL carryforwards, subject to expiration | 1,600,000 | |
State | ||
Net operating loss carryforwards | 57,000,000 | |
Foreign Tax Authority | ||
Net operating loss carryforwards | $ 2,200,000 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) | 12 Months Ended | |||||||||||||||
Oct. 03, 2023 | Sep. 15, 2023 | Sep. 14, 2023 | Sep. 12, 2023 | May 12, 2023 | May 10, 2023 | May 09, 2023 | Dec. 14, 2022 | Dec. 13, 2022 | Apr. 25, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Aug. 15, 2023 | Feb. 23, 2023 | Apr. 13, 2022 | Feb. 23, 2022 | |
Exercise price (in dollars per share) | $ 5.74 | $ 5.82 | ||||||||||||||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||||||||||||
Proceeds from issuance of common stock | $ 8,724,855 | $ 1,250,000 | ||||||||||||||
Issuance costs | 313,149 | 87,646 | ||||||||||||||
Stock-based compensation | $ 6,326,055 | 8,889,474 | ||||||||||||||
Shares to be issued for loan conversion | 6,005,487 | |||||||||||||||
Aggregate exercise price | $ 5,592,573 | 5,300,033 | ||||||||||||||
Restricted Stock Units | ||||||||||||||||
Vested (in shares) | 130,464 | |||||||||||||||
Stock-based compensation | 1,755,995 | 27,356 | ||||||||||||||
ATM | ||||||||||||||||
Net cash proceeds | $ 41,000,000 | |||||||||||||||
Sales Agreement | ||||||||||||||||
Common stock, par value (in dollars per share) | $ 0.0001 | |||||||||||||||
Proceeds from issuance of common stock | $ 8,724,544 | |||||||||||||||
Number of shares issued during period | 3,109,843 | |||||||||||||||
Issuance costs | $ 105,253 | |||||||||||||||
Sales Agreement | Maximum | ||||||||||||||||
Proceeds from issuance of common stock | $ 50,000,000 | |||||||||||||||
Excel Revolving Line of Credit Agreement | ||||||||||||||||
Exercise price (in dollars per share) | $ 0.80 | |||||||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 2,500,000 | |||||||||||||||
Line of Credit Facility, Expiration Period | 12 months | |||||||||||||||
Line of Credit Facility, Interest Rate During Period | 10% | |||||||||||||||
Excel Revolving Line of Credit Agreement | Maximum | ||||||||||||||||
Number of aggregate warrants | 3,125,000 | |||||||||||||||
Ownership interest percentage | 29.99% | |||||||||||||||
Line of Credit Facility, Current Borrowing Capacity | $ 1,250,000 | |||||||||||||||
Line of Credit Facility, Restriction on Draw Down As A Percentage | 25% | |||||||||||||||
Excel May 2023 Secured Line of Credit Pay Off Amount | ||||||||||||||||
Line of credit | $ 934,200 | $ 3,262,817 | ||||||||||||||
Shares to be issued for loan conversion | 2,910,771 | |||||||||||||||
Amended Warrant Exercise Price | ||||||||||||||||
Number of aggregate warrants | 4,055,240 | |||||||||||||||
Exercise price (in dollars per share) | $ 0.80 | |||||||||||||||
Proceeds from board member and related party | $ 983,851 | |||||||||||||||
Days until maturity | 8 days | |||||||||||||||
Aggregate exercise price | $ 1,462,518 | |||||||||||||||
Aggregate number of shares | 1,828,147 | |||||||||||||||
Mr. Cassidy | Amended Warrant Exercise Price | Maximum | ||||||||||||||||
Number of aggregate warrants | 786,482 | |||||||||||||||
Denise Penz | Amended Warrant Exercise Price | Maximum | ||||||||||||||||
Number of aggregate warrants | 443,332 | |||||||||||||||
Excel Family Partners, LLLP | Non-revolving lines of credit, April 25, 2022 | ||||||||||||||||
Number of aggregate warrants | 383,141 | |||||||||||||||
Exercise price (in dollars per share) | $ 5.25 | |||||||||||||||
Common stock, par value (in dollars per share) | $ 0.0001 | |||||||||||||||
Line of credit | $ 0 | $ 4,226,181 | ||||||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 4,022,986 | $ 1,500,000 | $ 2,000,000 | $ 1,500,000 | ||||||||||||
Proceeds from Lines of Credit | $ 2,000,000 | |||||||||||||||
Line of Credit Facility, Interest Rate During Period | 12% | |||||||||||||||
Shares to be issued for loan conversion | 6,005,487 | |||||||||||||||
Days until maturity | 25 months | 24 months | 24 months | 18 months | 18 months |