Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Dec. 31, 2013 | Feb. 07, 2014 | |
Document and Entity Information: | ' | ' |
Entity Registrant Name | 'SECUREALERT, INC. | ' |
Document Type | 'S-1 | ' |
Document Period End Date | 31-Dec-13 | ' |
Amendment Flag | 'false | ' |
Entity Central Index Key | '0001045942 | ' |
Current Fiscal Year End Date | '--09-30 | ' |
Entity Common Stock, Shares Outstanding | ' | 9,813,749 |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Voluntary Filers | 'No | ' |
Entity Well-known Seasoned Issuer | 'No | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'FY | ' |
CONDENSED_CONSOLIDATED_BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) | Dec. 31, 2013 | Sep. 30, 2013 |
Current assets: | ' | ' |
Cash | $1,326,278 | $3,382,428 |
Accounts receivable, net of allowance for doubtful accounts of $3,959,000 and $3,968,000, respectively | 3,563,456 | 3,721,964 |
Note receivable, current portion | 167,301 | 176,205 |
Prepaid expenses and other | 2,230,328 | 1,783,805 |
Inventory, net of reserves of $252,114 and $148,043, respectively | 640,541 | 467,101 |
Total current assets | 7,927,904 | 9,531,503 |
Property and equipment, net of accumulated depreciation of $2,139,395 and $2,092,222, respectively | 333,108 | 318,201 |
Monitoring equipment, net of accumulated amortization of $1,238,912 and $1,183,346, respectively | 1,600,180 | 1,236,696 |
Note receivable, net of current portion | ' | 28,499 |
Intangible assets, net of accumulated amortization of $1,478,279 and $1,256,647, respectively | 15,192,288 | 15,413,920 |
Other assets | 3,516,650 | 170,172 |
Total assets | 28,570,130 | 26,698,991 |
Current liabilities: | ' | ' |
Accounts payable | 670,609 | 348,074 |
Accrued liabilities | 2,233,599 | 2,180,791 |
Dividends payable | 9,427 | 9,427 |
Deferred revenue | 8,685 | 8,674 |
Current portion of long-term related-party debt | 2,700,000 | 60,000 |
Current portion of long-term debt | 87,115 | 88,095 |
Total current liabilities | 5,709,435 | 2,695,061 |
Long-term debt, net of current portion | 19,350 | 40,588 |
Total liabilities | 5,728,785 | 2,735,649 |
Stockholders' equity: | ' | ' |
Series D 8% dividend, convertible, voting, $0.0001 par value: 85,000 shares designated; 468 and 468 shares outstanding, respectively (aggregate liquidation preference of $467,507) | 1 | 1 |
Common stock, $0.0001 par value: 15,000,000 shares authorized; 9,811,946 and 9,805,503 shares outstanding, respectively | 980 | 980 |
Additional paid-in capital | 290,539,894 | 290,391,698 |
Accumulated deficit | -267,699,530 | -266,429,337 |
Total equity | 22,841,345 | 23,963,342 |
Total liabilities and stockholders' equity | $28,570,130 | $26,698,991 |
CONDENSED_CONSOLIDATED_BALANCE1
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Dec. 31, 2013 | Sep. 30, 2013 |
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) | ' | ' |
Allowance for doubtful accounts | $3,959,000 | $3,968,000 |
Reserve for damaged or obsolete inventory | 252,114 | 148,043 |
Property and equipment accumulated depreciation | 2,139,395 | 2,092,222 |
Monitoring equipment accumulated amortization | 1,238,912 | 1,183,346 |
Intangible assets accumulated amortization | 1,478,279 | 1,256,647 |
Series D 8% dividend, convertible, voting - par value | $0.00 | $0.00 |
Series D 8% dividend, convertible, voting - shares designated | 85,000 | 85,000 |
Series D 8% dividend, convertible, voting - shares outstanding | 468 | 468 |
Series D 8% dividend, convertible, voting - aggregate liquidation preference | $467,507 | ' |
Common stock - par value | $0.00 | $0.00 |
Common stock - shares authorized | 15,000,000 | 15,000,000 |
Common stock - shares outstanding | 9,811,946 | 9,805,503 |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 3 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Revenues: | ' | ' |
Products (Revenues) | $65,611 | $1,212,497 |
Monitoring and other related services (Revenues) | 2,593,683 | 4,375,575 |
Total revenues | 2,659,294 | 5,588,072 |
Cost of revenues: | ' | ' |
Products (Cost of revenues) | 62,721 | 615,592 |
Monitoring and other related services (Cost of revenues) | 1,336,108 | 2,362,926 |
Total cost of revenues | 1,398,829 | 2,978,518 |
Gross profit | 1,260,465 | 2,609,554 |
Operating expenses: | ' | ' |
Selling, general and administrative (including $140,196 and $7,344, respectively, of compensation expense paid in stock, stock options / warrants or as a result of amortization of stock-based compensation) | 2,171,447 | 2,038,022 |
Settlement expense | ' | 350,000 |
Research and development | 319,570 | 201,594 |
Income (loss) from continuing operations | -1,230,552 | 19,938 |
Other income (expense): | ' | ' |
Currency exchange rate loss | -7,035 | -8,204 |
Loss on disposal of equipment | ' | -1,365 |
Interest income | 11,223 | ' |
Interest expense (including $2,118 and $700,384, respectively, paid in stock, stock options / warrants, and accretion of debt discount) | -43,918 | -843,224 |
Other income (expense), net | 89 | -7,983 |
Net loss from continuing operations | -1,270,193 | -840,838 |
Gain on disposal of discontinued operations | ' | 285,255 |
Net loss from discontinued operations | ' | -6,460 |
Net loss | -1,270,193 | -562,043 |
Dividends on Series D Preferred stock | -9,427 | -630,330 |
Net loss attributable to SecureAlert, Inc. common stockholders | ($1,279,620) | ($1,192,373) |
Net loss per common share, basic and diluted from continuing operations | ($0.13) | ($0.26) |
Net loss per common share, basic and diluted from discontinued operations | ' | ' |
Weighted average common shares outstanding, basic and diluted | 9,808,000 | 3,183,520 |
CONDENSED_CONSOLIDATED_STATEME1
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) (USD $) | 3 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) | ' | ' |
Compensation expense paid in stock, stock options, warrants or as a result of amortization of stock-based compensation included in selling and general and administrative expenses | $140,196 | $7,344 |
Interest expense paid in stock, stock options, warrants, or repricing of warrants, and accretion of debt discount | $2,118 | $700,384 |
CONDENSED_CONSOLIDATED_STATEME2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 3 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Cash flows from operating activities: | ' | ' |
Net Loss | ($1,270,193) | ($562,043) |
Income from discontinued operations | ' | 6,460 |
Loss from continuing operations | -1,270,193 | -555,583 |
Adjustments to reconcile net income to net cash used in operating activities: | ' | ' |
Depreciation and amortization | 459,799 | 479,569 |
Vesting of stock options for services | 71,250 | 7,344 |
Issuance of warrants to Board of Directors for services | 53,946 | ' |
Issuance of common stock to Board of Directors for services | 15,000 | ' |
Accretion interest expense in connection with debt discount related to notes payable | 2,118 | 147,606 |
Beneficial conversion feature recorded as interest expense | ' | 552,778 |
Impairment of monitoring equipment and parts | 75,000 | 150,000 |
Loss on disposal of property and equipment | ' | 1,365 |
Loss on disposal of monitoring equipment and parts | 10,771 | 31,851 |
Gain on disposal of discontinued operations | ' | -285,255 |
Change in assets and liabilities: | ' | ' |
Change in accounts receivable, net | 158,508 | -3,248,722 |
Change in notes receivable | 37,403 | 37,332 |
Change in inventories | -63,498 | 7,607 |
Change in prepaid expenses and other assets | -446,379 | -43,784 |
Change in accounts payable | 322,535 | -83,600 |
Change in accrued expenses | 52,808 | 2,074,597 |
Change in deferred revenue | 11 | -317,551 |
Net cash used in operating activities | -520,921 | -1,044,446 |
Cash flow from investing activities: | ' | ' |
Purchase of property and equipment | -62,082 | -3,826 |
Purchase of monitoring equipment and parts | -750,189 | -229,000 |
Cash deposited in escrow to secure international bond | -3,346,622 | ' |
Net cash used in investing activities | -4,158,893 | -232,826 |
Cash flow from financing activities: | ' | ' |
Borrowings on related-party notes payable | 2,700,000 | 1,800,000 |
Principal payments on related-party notes payable | -60,000 | ' |
Principal payments on notes payable | -24,336 | -187,947 |
Cash received from the exercise of warrants | 8,000 | ' |
Net cash provided by financing activities | 2,623,664 | 1,612,053 |
Cash flow from discontinued operations: | ' | ' |
Net cash provided by operating activities | ' | 993 |
Net cash used in financing activities | ' | -18,475 |
Net cash used in discontinued operations | ' | -17,482 |
Net increase (decrease) in cash | -2,056,150 | 317,299 |
Cash, beginning of period | 3,382,428 | 458,029 |
Cash, end of period | 1,326,278 | 775,328 |
Cash paid for interest | 7,519 | 41,715 |
Supplemental schedule of non-cash investing and financing activities: | ' | ' |
Issuance of 483 and 103,808 shares of common stock in connection with Series D Preferred stock dividends | 9,427 | 630,528 |
Series D Preferred stock dividends earned | $9,427 | $630,330 |
CONDENSED_CONSOLIDATED_STATEME3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) | 3 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) | ' | ' |
Common stock issued for payment of Series D Preferred stock dividends | 483 | 103,808 |
1_Basis_of_Presentation
(1) Basis of Presentation | 3 Months Ended |
Dec. 31, 2013 | |
Notes | ' |
(1) Basis of Presentation | ' |
(1) BASIS OF PRESENTATION | |
The unaudited interim condensed consolidated financial information of SecureAlert, Inc. and subsidiaries (collectively, the “Company” or “SecureAlert”) has been prepared in accordance with the Instructions to Form 10-Q and Article 8 of Regulation S-X promulgated by the Securities and Exchange Commission (“SEC”). Certain information and disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, the accompanying interim consolidated financial information contains all adjustments, consisting only of normal recurring adjustments necessary to present fairly the Company’s financial position as of December 31, 2013, and results of its operations for the three months ended December 31, 2013 and 2012. These financial statements should be read in conjunction with the annual consolidated financial statements and notes thereto that are included in the Company’s Annual Report on Form 10-K for the year ended September 30, 2013. The results of operations for the three months ended December 31, 2013 may not be indicative of the results for the fiscal year ending September 30, 2014. |
2_Principles_of_Consolidation
(2) Principles of Consolidation | 3 Months Ended |
Dec. 31, 2013 | |
Notes | ' |
(2) Principles of Consolidation | ' |
(2) PRINCIPLES OF CONSOLIDATION | |
The condensed consolidated financial statements include the accounts of SecureAlert and its subsidiaries. All significant inter-company transactions have been eliminated in consolidation. |
3_Recently_Issued_Accounting_S
(3) Recently Issued Accounting Standards | 3 Months Ended |
Dec. 31, 2013 | |
Notes | ' |
(3) Recently Issued Accounting Standards | ' |
(3) RECENTLY ISSUED ACCOUNTING STANDARDS | |
From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (FASB) or other standard setting bodies, which are adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on its financial position or results of operations upon adoption. |
4_Impairment_of_Longlived_Asse
(4) Impairment of Long-lived Assets | 3 Months Ended |
Dec. 31, 2013 | |
Notes | ' |
(4) Impairment of Long-lived Assets | ' |
(4) IMPAIRMENT OF LONG-LIVED ASSETS | |
The Company reviews its long-lived assets for impairment when events or changes in circumstances indicate that the book value of an asset may not be recoverable and in the case of intangibles, at least annually. The Company evaluates whether events and circumstances have occurred which indicate possible impairment as of each balance sheet date. If the carrying amount of an asset exceeds its fair value, an impairment charge is recognized for the amount by which the carrying amount exceeds the estimated fair value of the asset. Impairment of long-lived assets is assessed at the lowest levels for which there is an identifiable fair value that is independent of other groups of assets. During the three months ended December 31, 2013 and 2012, the Company had no impairments. |
5_Geographic_Information
(5) Geographic Information | 3 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Notes | ' | |||||||
(5) Geographic Information | ' | |||||||
(5) GEOGRAPHIC INFORMATION | ||||||||
During the three months ended December 31, 2013, the Company recognized revenues from international sources from its products and monitoring services. Revenues are attributed to the geographic areas based on the location of the customers purchasing and leasing the products and services. The revenues recognized by geographic area for the three months ended December 31, 2013 and 2012, are as follows: | ||||||||
31-Dec-13 | 31-Dec-12 | |||||||
United States of America | $ 1,884,164 | $ 1,768,366 | ||||||
Latin American Countries | - | 3,018,477 | ||||||
Caribbean Countries and Commonwealths | 756,678 | 786,530 | ||||||
Other Foreign Countries | 18,452 | 14,699 | ||||||
Total | $ 2,659,294 | $ 5,588,072 | ||||||
The long-lived assets, net of accumulated depreciation, used in the generation of revenues by geographic area as of December 31, 2013 and September 30, 2013, were as follows: | ||||||||
Net Property and Equipment | Net Monitoring Equipment | |||||||
31-Dec-13 | 30-Sep-13 | 31-Dec-13 | 30-Sep-13 | |||||
United States of America | $ 306,579 | $ 318,201 | $ 1,437,866 | $ 878,823 | ||||
Latin American Countries | - | - | - | - | ||||
Caribbean Countries and Commonwealths | 8,391 | - | 155,263 | 351,138 | ||||
Other Foreign Countries | 18,138 | - | 7,051 | 6,735 | ||||
Total | $ 333,108 | $ 318,201 | $ 1,600,180 | $ 1,236,696 | ||||
6_Net_Loss_Per_Common_Share
(6) Net Loss Per Common Share | 3 Months Ended | ||||
Dec. 31, 2013 | |||||
Notes | ' | ||||
(6) Net Loss Per Common Share | ' | ||||
(6) NET LOSS PER COMMON SHARE | |||||
Basic net loss per common share ("Basic EPS") is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding during the period. | |||||
Diluted net loss per common share ("Diluted EPS") is computed by dividing net loss attributable to common shareholders by the sum of the weighted-average number of common shares outstanding and the weighted-average dilutive common share equivalents outstanding. The computation of Diluted EPS does not assume exercise or conversion of securities that would have an anti-dilutive effect. | |||||
Common share equivalents consist of shares issuable upon the exercise of common stock options and warrants, and shares issuable upon conversion of preferred stock. As of December 31, 2013 and 2012, there were 466,094 and 2,547,492 outstanding common share equivalents, respectively, that were not included in the computation of Diluted EPS as their effect would be anti-dilutive. No reconciliation for discontinued operations was provided since the impact was immaterial. The common stock equivalents outstanding as of December 31, 2013 and 2012, consisted of the following: | |||||
31-Dec-13 | 31-Dec-12 | ||||
Conversion of debt and accrued interest | - | 586,070 | |||
Conversion of Series D Preferred stock | 24,503 | 1,462,890 | |||
Exercise of outstanding common stock options and warrants | 399,591 | 336,532 | |||
Exercise and conversion of outstanding Series D Preferred | |||||
stock warrants | 42,000 | 162,000 | |||
Total common stock equivalents | 466,094 | 2,547,492 | |||
7_Prepaid_and_Other_Expenses
(7) Prepaid and Other Expenses | 3 Months Ended |
Dec. 31, 2013 | |
Notes | ' |
(7) Prepaid and Other Expenses | ' |
(7) PREPAID AND OTHER EXPENSES | |
The carrying amounts reported in the balance sheets for prepaid and other expenses approximate their fair market value based on the short-term maturity of these instruments. As of December 31, 2013 and 2012, the outstanding balance of prepaid and other expenses was $2,230,328 and $1,783,805, respectively. Of the $2,230,328, was a bond posted for an international customer totaling $1,488,778 which the Company believes will be returned to the Company by March 31, 2014. |
8_Inventory
(8) Inventory | 3 Months Ended | ||||
Dec. 31, 2013 | |||||
Notes | ' | ||||
(8) Inventory | ' | ||||
(8) INVENTORY | |||||
Inventory is valued at the lower of the cost or market. Cost is determined using the first-in, first-out (“FIFO”) method. Market is determined based on the estimated net realizable value, which generally is the item selling price. Inventory is periodically reviewed in order to identify obsolete or damaged items or impaired values. | |||||
Inventory consists of raw materials that are used in the manufacturing of TrackerPAL® and ReliAlert devices. Completed TrackerPAL® and ReliAlert devices are reflected in Monitoring Equipment. As of December 31, 2013 and September 30, 2013, respectively, inventory consisted of the following: | |||||
December 31, | September 30, | ||||
2013 | 2013 | ||||
Raw materials | $ 892,655 | $ 615,144 | |||
Reserve for damaged or obsolete inventory | (252,114) | (148,043) | |||
Total inventory, net of reserves | $ 640,541 | $ 467,101 | |||
9_Property_and_Equipment
(9) Property and Equipment | 3 Months Ended | ||||
Dec. 31, 2013 | |||||
Notes | ' | ||||
(9) Property and Equipment | ' | ||||
(9) PROPERTY AND EQUIPMENT | |||||
Property and equipment as of December 31, 2013 and September 30, 2013, were as follows: | |||||
December 31, | September 30, | ||||
2013 | 2013 | ||||
Equipment, software and tooling | $ 2,064,657 | $ 2,002,577 | |||
Automobiles | 33,466 | 33,466 | |||
Leasehold improvements | 127,162 | 127,162 | |||
Furniture and fixtures | 247,218 | 247,218 | |||
Total property and equipment before accumulated depreciation | 2,472,503 | 2,410,423 | |||
Accumulated depreciation | (2,139,395) | (2,092,222) | |||
Property and equipment, net of accumulated depreciation | $ 333,108 | $ 318,201 | |||
Depreciation expense for the three months ended December 31, 2013 and 2012, was $47,175 and $67,156, respectively. Property and equipment to be disposed of is reported at the lower of the carrying amount or fair value, less the estimated costs to sell and any gains or losses are included in the results of operations. During the three months ended December 31, 2013 and 2012, the Company disposed of property and equipment with a net book value of $0 and $1,365, respectively. |
10_Monitoring_Equipment
(10) Monitoring Equipment | 3 Months Ended | ||||
Dec. 31, 2013 | |||||
Notes | ' | ||||
(10) Monitoring Equipment | ' | ||||
(10) MONITORING EQUIPMENT | |||||
Monitoring equipment as of December 31, 2013 and September 30, 2013, was as follows: | |||||
December 31, | September 30, | ||||
2013 | 2013 | ||||
Monitoring equipment | $ 2,839,092 | $ 2,420,042 | |||
Less: accumulated depreciation | (1,238,912) | (1,183,346) | |||
Monitoring equipment, net of accumulated depreciation | $ 1,600,180 | $ 1,236,696 | |||
The Company began leasing monitoring equipment to agencies for offender tracking in April 2006 under operating lease arrangements. The monitoring equipment is amortized using the straight-line method over an estimated useful life of three years. | |||||
Depreciation expense for the three months ended December 31, 2013 and 2012, was $190,992 and $324,246, respectively. Additionally, as of December 31, 2013, the Company reserved $75,000 for future monitoring equipment impairment. These expenses were classified as a cost of revenues. | |||||
Assets to be disposed of are reported at the lower of the carrying amount or fair value, less the estimated costs to sell. During the three months ended December 31, 2013 and 2012, the Company recorded in cost of revenues disposal of lease monitoring equipment and parts of $10,771 and $31,851, respectively. |
11_Intangible_Assets
(11) Intangible Assets | 3 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Notes | ' | |||||||
(11) Intangible Assets | ' | |||||||
(11) INTANGIBLE ASSETS | ||||||||
The following table summarizes the activity of intangible assets for the first fiscal quarter ended December 31, 2013: | ||||||||
Borinquen Container Corporation | International Surveillance Services Corp. | Patent | Total | |||||
Intangible assets: | ||||||||
Patent license agreement | $ - | $ - | $ 50,000 | $ 50,000 | ||||
Royalty agreement | 11,616,984 | 5,003,583 | - | 16,620,567 | ||||
Total intangible assets | 11,616,984 | 5,003,583 | 50,000 | 16,670,567 | ||||
Accumulated amortization | (831,072) | (625,448) | (21,759) | (1,478,279) | ||||
Intangible assets, net of accumulated amortization | $10,785,912 | $ 4,378,135 | $ 28,241 | $15,192,288 | ||||
Borinquen Container Corporation | ||||||||
On September 5, 2012, the Company entered into an agreement to redeem the royalty held by Borinquen Container Corporation (“Borinquen”) pursuant to a royalty agreement dated July 1, 2011, as amended. Under the terms of the royalty, Borinquen had the right to receive 20 percent of net revenues derived within certain geographic territories. | ||||||||
On February 1, 2013, the Company redeemed the royalty with Borinquen and the Company capitalized the total cost of the royalty purchase commitment of $11,616,984, as a non-current asset and will amortize the asset over the remaining term of the royalty agreement, subject to periodic analysis for impairment based on future expected revenues. The Company will annually calculate the amortization based on the effective royalty rate and on the revenues in the geographic territory subject to the royalty. The Company’s analysis will be based on such factors as historical revenue and expected revenue growth in the territory. | ||||||||
As of December 31, 2013, the Company had a balance of $11,616,984 of intangible assets, as noted in the table above. The Company recorded $157,698 of amortization expense on intangible assets for Borinquen during the three months ended December 31, 2013, resulting in a total accumulated amortization of $831,072 and net other intangible assets of $10,785,912. | ||||||||
International Surveillance Services Corp. | ||||||||
Effective July 1, 2011, the Company entered into a stock purchase agreement and purchased all of the issued and outstanding shares of International Surveillance Services Corp. (“ISS”), a Puerto Rico corporation, to utilize the knowledge and connections of ISS in Central and South America and to acquire the rights to certain territorial commissions that were payable by the Company to ISS. | ||||||||
As of December 31, 2013, the Company had a balance of $5,003,583 of intangible assets, as noted in the table above. The Company recorded $62,545 of amortization expense on intangible assets for ISS during the three months ended December 31, 2013, resulting in a total accumulated amortization of $625,448 and net other intangible assets of $4,378,135. | ||||||||
Patent License | ||||||||
On January 29, 2010, the Company and Satellite Tracking of People, LLC (“STOP”) entered into a license agreement whereby STOP granted to the Company a non-exclusive license under U.S. Patent No. 6,405,213 and any and all patents issuing from continuation, continuation-in-part, divisional, reexamination and reissues thereof and along with all foreign counterparts, to make, have made, use, sell, offer to sell and import covered products in the Company’s present and future business. The license will continue for so long as any of the licensed patents have enforceable rights. The license is not assignable or transferable except for sublicenses within the scope of the license to the Company’s subsidiaries. | ||||||||
The Company paid $50,000 as consideration for the use of this patent. The Company recorded $1,389 of amortization expense for the patent during the three months ended December 31, 2013, resulting in a total accumulated amortization relating to the patent of $21,759 and net intangible assets of $28,241. | ||||||||
12_Other_Assets
(12) Other Assets | 3 Months Ended |
Dec. 31, 2013 | |
Notes | ' |
(12) Other Assets | ' |
(12) OTHER ASSETS | |
The carrying amounts reported in the balance sheets for other assets approximate their fair market value based on the long-term maturity of these instruments. As of December 31, 2013 and 2012, the outstanding balance of other assets was $3,516,650 and $170,172, respectively. Of the $3,516,650, $3,346,622 is cash held in Chilean Pesos to guarantee a bond for an international customer and will be released and available to the Company on March 16, 2018. The Company will reflect an unrealized gain or loss in future periods to reflect the change in currency fluctuations between Chilean Pesos and the US dollar until the money is returned to the Company at which time a realized gain or loss will be recorded on the financial statements. |
13_Accrued_Expenses
(13) Accrued Expenses | 3 Months Ended | ||||
Dec. 31, 2013 | |||||
Notes | ' | ||||
(13) Accrued Expenses | ' | ||||
(13) ACCRUED EXPENSES | |||||
Accrued expenses consisted of the following as of December 31, 2013 and September 30, 2013: | |||||
December 31, | September 30, | ||||
2013 | 2013 | ||||
Accrued royalties | $ 843,676 | $ 714,400 | |||
Accrued payroll, taxes and employee benefits | 493,623 | 473,179 | |||
Accrued consulting | 308,324 | 317,300 | |||
Accrued taxes - foreign and domestic | 91,101 | 262,880 | |||
Accrued travel | 82,080 | 50,000 | |||
Accrued legal costs | 78,070 | 57,001 | |||
Accrued settlement costs | 70,000 | 76,000 | |||
Accrued interest | 63,793 | 27,394 | |||
Accrued board of directors fees | 60,000 | 68,090 | |||
Accrued cellular costs | 57,630 | 55,000 | |||
Accrued outside services | 39,728 | 33,022 | |||
Accrued warranty and manufacturing costs | 30,622 | 30,622 | |||
Accrued other expenses | 14,952 | 15,903 | |||
Total accrued expenses | $ 2,233,599 | $ 2,180,791 | |||
14_Debt_Obligations
(14) Debt Obligations | 3 Months Ended | ||||||
Dec. 31, 2013 | |||||||
Notes | ' | ||||||
(14) Debt Obligations | ' | ||||||
(14) DEBT OBLIGATIONS | |||||||
Debt obligations as of December 31, 2013 and September 30, 2013, consisted of the following: | |||||||
December 31, | September 30, | ||||||
2013 | 2013 | ||||||
Note issued in connection with the acquisition of a subsidiary and matures in December 2014. | $ 51,230 | $ 64,111 | |||||
Capital leases with effective interest rates that range between 8.51% and 17.44%. Leases mature between June 2015 and November 2015. $154,410 was assumed through the sale of Midwest Monitoring & Surveillance, Inc. to its former owners. | 51,734 | 59,266 | |||||
Automobile loan with a financial institution secured by the vehicle. Interest rate is 7.06%, due June 2014. | 3,501 | 5,306 | |||||
Total debt obligations | 106,465 | 128,683 | |||||
Less current portion | (87,115) | (88,095) | |||||
Long-term debt, net of current portion | $ 19,350 | $ 40,588 | |||||
15_Relatedparty_Transactions
(15) Related-party Transactions | 3 Months Ended | ||||||
Dec. 31, 2013 | |||||||
Notes | ' | ||||||
(15) Related-party Transactions | ' | ||||||
(15) RELATED-PARTY TRANSACTIONS | |||||||
The Company entered into certain transactions with related parties during the three months ended December 31, 2013. These transactions consist mainly of financing transactions and service arrangements. Transactions with related parties are reviewed and approved by the independent and disinterested members of the Board of Directors. | |||||||
Loan Agreement | |||||||
On February 1, 2013, the Company entered into a loan agreement with Sapinda Asia (the “Loan”). Under this arrangement, the Company may borrow up to $1,200,000 at an interest rate of three3 percent per annum for unused funds and 10 percent per annum for borrowed funds. On October 24, 2013 the Company drew down the full $1,200,000 for use in a performance bond as required under a contract with an international customer. As of December 31, 2013, the Company owed $1,200,000 of principal and $49,316 of accrued interest on the Loan. The Loan matures on June 30, 2014. | |||||||
Related-Party Promissory Note | |||||||
On November 19, 2013, the Company borrowed $1,500,000 from Sapinda Asia, a significant shareholder. The unsecured note bears interest at a rate of 8 percent per annum and matures on November 18, 2014. As of December 31, 2013, the Company owed $1,500,000 of principal and $14,137 of accrued interest on the promissory note. | |||||||
Related-Party Service Agreement | |||||||
During the fiscal year ended September 30, 2013, the Company entered into an agreement with Paranet Solutions, LLC to provide the following primary services: (1) procurement of hardware and software necessary to ensure that vital databases are available in the event of a disaster (backup and disaster recovery system); and (2) providing the security of all data and the integrity of such data against all loss of data, misappropriation of data by Paranet, its employees and affiliates. David S. Boone, a director and member of the Company’s Executive Committee, is the Chief Executive Officer of Paranet. | |||||||
Facility Agreement | |||||||
On January 3, 2014, the Company entered into a loan agreement (“Facility Agreement”) with Tetra House Pte. Ltd. (“Tetra House”) to provide unsecured debt financing to the Company for acquisitions and for other corporate purposes, including working capital. Tetra House is a private company incorporated under the laws of the Republic of Singapore and is controlled by Mr. Guy Dubois who is a director and member of the Company’s Executive Committee, and currently serves as the Chairman of the Company’s Board of Directors. Under this agreement, the Company may borrow up to $25,000,000, through May 31, 2014. Borrowed amounts under the Facility Agreement bear interest at a rate of 8 percent per annum and interest is payable in arrears semi-annually. All outstanding principal under the Facility Agreement, together with accrued and unpaid interest, is due and payable on January 3, 2016. The Company may prepay (in minimum amounts of $1,000,000) borrowed amounts without penalty. In consideration of the Facility Agreement, the Company agreed to pay Tetra House an arrangement fee equal to 3 percent of the aggregate maximum amount under the Facility Agreement ($750,000). The arrangement fee is payable as follows: (i) one percent (1%) due within five business days of signing the Facility Agreement, and (ii) the remaining two percent (2%) being withheld from the first draw down of funds under the Facility Agreement. The Company may draw down funds in increments of not less than $2,000,000 and in integral multiples of $1,000,000 by submitting a Utilization Request to Tetra House. Tetra House has 10 business days in which to fund the Utilization Request upon receipt of such request. The Facility Agreement was reviewed and approved by disinterested and independent members of the Board of Directors, David S. Boone, Winfried Kunz, Dan L. Mabey and George F. Schmitt. Since January 3, 2014, the Company borrowed $10,000,000 under the Facility Agreement. On January 14, 2014 the Company was informed that Tetra House had assigned all of its rights and interests in the Facility Agreement to Conrent Invest, S.A., through its compartment “Safety II”, a securitization company established under the Luxembourg Law of 22 March 2004 on securitization. Another compartment of Conrent Invest, S.A., “Safety” is a shareholder of the Company. The Company has sought additional information regarding the relationship between these compartments and how they are controlled by Conrent Invest, S.A. | |||||||
Additional Related-Party Transactions and Summary of All Related-Party Obligations | |||||||
December 31, | September 30, | ||||||
2013 | 2013 | ||||||
Loan from a significant shareholder with an interest rate of 10% per annum. Principal and interest due at maturity on June 30, 2014. | $ 1,200,000 | $ - | |||||
Promissory note with a significant shareholder with an interest rate of 8% per annum. Principal and interest due at maturity on November 19, 2014. | 1,500,000 | - | |||||
Convertible debenture of $16,700,000 from a significant shareholder with an interest rate of 8% per annum. On September 30, 2013, $16,640,000 plus accrued interest of $936,627 was converted into 3,905,917 shares of common stock and in October 2013, the Company paid $60,000 in cash to pay off the debenture. | - | 60,000 | |||||
Total related-party debt obligations | 2,700,000 | 60,000 | |||||
Less current portion | (2,700,000) | (60,000) | |||||
Long-term debt, net of current portion | $ - | $ - | |||||
16_Preferred_Stock
(16) Preferred Stock | 3 Months Ended |
Dec. 31, 2013 | |
Notes | ' |
(16) Preferred Stock | ' |
(16) PREFERRED STOCK | |
The Company is authorized to issue up to 20,000,000 shares of preferred stock, $0.0001 par value per share. The Company's Board of Directors has the authority to amend the Company's Articles of Incorporation, without further shareholder approval, to designate and determine, in whole or in part, the preferences, limitations and relative rights of the preferred stock before any issuance of the preferred stock and to create one or more series of preferred stock. | |
Series D Convertible Preferred Stock | |
In July 2011, the Company amended its Articles of Incorporation and increased the total designated shares of Series D Preferred stock from 70,000 to 85,000 shares (“Series D Preferred stock”). During the three months ended December 31, 2013 and 2012, the Company did not issue any additional new shares of Series D Preferred stock. | |
As of December 31, 2013 and September 30, 2013, there were 468 Series D Preferred shares outstanding. | |
Dividends | |
The Series D Preferred stock is entitled to dividends at the rate equal to 8 percent per annum calculated on the purchase amount actually paid for the shares or amount of debt converted. The dividend is payable in cash or shares of common stock at the sole discretion of the Board of Directors. If a dividend is paid in shares of common stock of the Company, the number of shares to be issued is based on the average per share market price of the common stock for the 14-day period immediately preceding the applicable accrual date (i.e., March 31, June 30, September 30, or December 31, as the case may be). Dividends are payable quarterly, no later than 30 days following the end of the accrual period. | |
During the three months ended December 31, 2013 and 2012, the Company issued 483 and 103,808 shares of common stock to pay $9,427 and $630,528 of accrued dividends on the Series D Preferred stock earned during the three months ended September 30, 2013 and 2012, respectively. Subsequent to December 31, 2013, the Company issued 496 shares of common stock to pay $9,427 of accrued dividends on Series D Preferred stock earned during the three months ended December 31, 2013. | |
Convertibility | |
Each share of Series D Preferred stock may be converted into 30 shares of common stock, commencing after ninety days from the date of issue. During the three months ended December 31, 2013 and 2012, no shares of Series D Preferred stock were converted into shares of common stock. During fiscal year 2013, the Company entered into an employment agreement with an officer. In addition, the officer and the Company agreed that he may convert his Series D Preferred shares into common stock at a rate of 155 percent of each share’s original investment; provided that the officer must convert all of his Series D Preferred shares before the next annual shareholder meeting of the Company. As of December 31, 2013, the 468 shares of Preferred stock were convertible into 24,503 shares of common stock. | |
Redemption | |
On January 16, 2014, the Company sent out notices to Series D Preferred shareholders regarding the Company’s election under the Amended and Restated Designation of the Rights and Preferences to redeem 261 shares of Series D Preferred stock at 120% of the aggregate original investment of $260,007 through the payment of cash totaling $312,008. The redemption date is February 13, 2014. The redemption is subject to the shareholder’s right to convert the shares of Series D Preferred stock by giving notice of conversion prior to the redemption date. | |
Voting Rights and Liquidation Preference | |
The holders of the Series D Preferred stock may vote their shares on an as-converted basis on any issue presented for a vote of the shareholders, including the election of directors and the approval of certain transactions such as a merger or other business combination of the Company. As of December 31, 2013 and September 30, 2013, there were 468 shares of Series D Preferred stock outstanding. Additionally, the holders are entitled to a liquidation preference equal to their original investment amount. | |
In the event of the liquidation, dissolution or winding up of the affairs of the Company (including in connection with a permitted sale of all or substantially all of the Company’s assets), whether voluntary or involuntary, the holders of shares of Series D Preferred Stock then outstanding will be entitled to receive, out of the assets of the Company available for distribution to its shareholders, an amount per share equal to original issue price, as adjusted to reflect any stock split, stock dividend, combination, recapitalization and the like with respect to the Series D Preferred Stock. | |
Series D Preferred Stock Warrants | |
As of December 31, 2013, 1,400 warrants to purchase Series D Preferred stock at an exercise price of $500 per share were issued and outstanding. During the three months ended December 31, 2013, no Series D Preferred stock warrants were issued or exercised. |
17_Common_Stock
(17) Common Stock | 3 Months Ended |
Dec. 31, 2013 | |
Notes | ' |
(17) Common Stock | ' |
(17) COMMON STOCK | |
Authorized Shares | |
The Company held an Annual Shareholders meeting on February 28, 2013, at which time the shareholders approved a reverse stock split at a ratio of 200 for 1 and reduced the total authorized shares of common stock to 15,000,000 shares. The retroactive effect of the reverse stock split has been reflected throughout these financial statements. | |
Common Stock Issuances | |
During the three months ended December 31, 2013, the Company issued 483 shares of common stock to pay $9,427 of accrued dividends on Series D Preferred stock; 760 shares of common stock to pay $15,000 of Board of Director fees for services rendered during the fourth fiscal quarter ended September 30, 2013; and 5,200 shares of common stock were issued from the exercise of options and warrants providing net cash proceeds to the Company of $8,000. Subsequent to December 31, 2013, the Company issued 496 shares of common stock as payment of dividends on Series D Preferred stock for the first fiscal quarter ended December 31, 2013, valued at $9,427. |
18_Stock_Options_and_Warrants
(18) Stock Options and Warrants | 3 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Notes | ' | ||||||||
(18) Stock Options and Warrants | ' | ||||||||
(18) STOCK OPTIONS AND WARRANTS | |||||||||
Stock Incentive Plan | |||||||||
At the annual meeting of shareholders on December 21, 2011, the shareholders approved the 2012 Equity Compensation Plan (the “2012 Plan”), which had previously been adopted by the Board of Directors of the Company. The 2012 Plan provides for the grant of incentive stock options and nonqualified stock options, restricted stock, stock appreciation rights, performance shares, performance stock units, dividend equivalents, stock payments, deferred stock, restricted stock units, other stock-based awards and performance-based awards to employees and certain non-employees who have important relationships with the Company. A total of 90,000 shares are authorized for issuance pursuant to awards granted under the 2012 Plan. During the three months ended December 31, 2013 and 2012, no options were issued under this 2012 Plan, respectively. As of December 31, 2013, 60,000 shares of common stock were available for future grants under the 2012 Plan. | |||||||||
All Options and Warrants | |||||||||
During the three months ended December 31, 2013 and 2012, the Company granted 6,840 and 0 stock purchase warrants, respectively. These warrants were fully vested at the time of grant and have a term of two years. The 6,840 warrants granted this quarter were to members of its Board of Directors for services rendered during the fourth fiscal quarter ended September 30, 2013, valued at $53,947. As of December 31, 2013, $83,128 of compensation expense associated with unvested stock options and warrants issued previously to members of the Board of Directors will be recognized over the next year. | |||||||||
The Company recorded $125,196 and $7,344 of expense for the three months ended December 31, 2013 and 2012, respectively, related to the granting and vesting of all stock options and warrants. The following are the weighted-average assumptions used for options granted during the three months ended December 31, 2013 and 2012 using the Black-Scholes model, respectively: | |||||||||
Three Months Ended December 31, | |||||||||
2013 | 2012 | ||||||||
Expected cash dividend yield | - | - | |||||||
Expected stock price volatility | 103% | - | |||||||
Risk-free interest rate | 0.10% | - | |||||||
Expected life of options/warrants | 1 Year | - | |||||||
The fair value of each stock option and warrant grant is estimated on the date of grant using the Black-Scholes option-pricing model. The expected life of stock options and warrants represents the period of time that the stock options or warrants are expected to be outstanding based on the simplified method allowed under GAAP. The expected volatility is based on the historical price volatility of the Company’s common stock. The risk-free interest rate represents the U.S. Treasury bill rate for the expected life of the related stock options and warrants. The dividend yield represents the Company’s anticipated cash dividends over the expected life of the stock option and warrants. | |||||||||
A summary of stock option and warrant activity for the three months ended December 31, 2013 is presented below: | |||||||||
Shares Under Option/ Warrant | Weighted Average Exercise Price | Weighted Average Remaining Contractual Life | Aggregate Intrinsic Value | ||||||
Outstanding as of September 30, 2013 | 427,965 | $ 16.12 | |||||||
Granted | 6,840 | $ 19.46 | |||||||
Expired / Cancelled | - | $ - | |||||||
Exercised | (35,214) | $ 16.43 | |||||||
Outstanding as of December 31, 2013 | 399,591 | $ 16.15 | 1.16 years | $1,640,319 | |||||
Exercisable as of December 31, 2013 | 380,730 | $ 16.50 | 1.15 years | $1,446,243 | |||||
The intrinsic values are based upon the closing price on December 31, 2013 of $19.29 per share. |
19_Changes_in_Equity
(19) Changes in Equity | 3 Months Ended | ||
Dec. 31, 2013 | |||
Notes | ' | ||
(19) Changes in Equity | ' | ||
(19) CHANGES IN EQUITY | |||
A summary of the composition of equity of the Company as of December 31, 2013, and the changes during the three months then ended is presented in the following table: | |||
Total Equity | |||
Balance at September 30, 2013 | $ 23,963,342 | ||
Issuance of common stock for: | |||
Dividends from Series D Preferred stock | 9,427 | ||
Board of Director fees | 15,000 | ||
Exercise of options and warrants | 8,000 | ||
Vesting of stock options and warrants | 71,250 | ||
Series D Preferred dividends | (9,427) | ||
Issuance of warrants for Board of Director fees | 53,946 | ||
Net loss | (1,270,193) | ||
Balance at December 31, 2013 | $ 22,841,345 | ||
20_Commitments_and_Contingenci
(20) Commitments and Contingencies | 3 Months Ended |
Dec. 31, 2013 | |
Notes | ' |
(20) Commitments and Contingencies | ' |
(20) COMMITMENTS AND CONTINGENCIES | |
Legal Matters | |
Lazar Leybovich et al v. SecureAlert, Inc. On March 29, 2012, Lazar Leybovich, Dovie Leybovich and Ben Leybovich filed a complaint in the 11th Circuit Court in and for Miami-Dade County, Florida alleging breach of contract with regard to certain Stock Redemption Agreements with the Company. The complaint was subsequently withdrawn by the plaintiffs. An amended complaint was filed by the plaintiffs on November 15, 2012. The Company believes these allegations are inaccurate and intend to defend the case vigorously. The Company has not accrued any potential loss as the probability of incurring a material loss is deemed remote by management, after consultation with legal counsel. | |
Larry C. Duggan v. Court Programs of Florida, Inc. and SecureAlert, Inc. On March 26, 2012, Mr. Duggan filed a complaint in the 9th Circuit Court in and for Orange County, Florida alleging malicious prosecution, abuse of process and negligent infliction of emotional distress against us and our former subsidiary. The case resulted from actions of a former agent of our former subsidiary. The Company intends to defend this matter. The Company has not accrued any potential loss as the probability of incurring a material loss is deemed remote by management, after consultation with legal counsel. | |
Integratechs v. SecureAlert, Inc. On March 14, 2013, Integratechs, Inc. filed a suit in the Fourth Judicial District Court of Utah County, claiming the Company breached a contract for computer services and intentionally interfered with its economic relations. The Company believes the allegations are inaccurate and will defend the case vigorously. No accrual for a potential loss has been made as the Company believes the probability of incurring a material loss is remote. | |
Christopher P. Baker v. SecureAlert, Inc. In February 2013, Mr. Baker filed suit against the Company in the Third Judicial District Court in and for Salt Lake County, State of Utah. Mr. Baker asserts that the Company breached a 2006 consulting agreement with him and claims damages of not less than $210,000. The Company disputes plaintiff’s claims and will defend the case vigorously. No accrual for a potential loss has been made as the Company believes the probability of incurring a material loss is remote. | |
SecureAlert, Inc. v. STOP, LLC. On December 17, 2013, the Company filed a claim in the United States District Court, District of Utah, Central Division against STOP, LLC seeking declaratory relief and other claims related to a Settlement Agreement entered into by and between the Company and STOP, effective January 29, 2010. The complaint was filed under seal and is not publicly available. The Company believes the relief sought in the case is warranted based on the language and intent of the parties and we will pursue the matter vigorously. | |
21_Discontinued_Operations
(21) Discontinued Operations | 3 Months Ended | ||||
Dec. 31, 2013 | |||||
Notes | ' | ||||
(21) Discontinued Operations | ' | ||||
(21) DISCONTINUED OPERATIONS | |||||
SecureAlert entered into a Stock Purchase Agreement to sell to a former principal all of the issued and outstanding stock of Court Programs Inc. (“Court Programs”), effective January 1, 2013. Court Programs were components of the Company’s consolidated entity, and as a result of the sale, these financial statements include the applicable discontinued operations reporting treatment. | |||||
Since the sale of Court Programs was effective January 1, 2013, there were no effect to the assets and liabilities of Court Programs reported as discontinued operations for the three months ended December 31, 2013 and fiscal year ended September 30, 2013, respectively: | |||||
A summary of the operating results of discontinued operations for the three months ended December 31, 2013 and 2012 are as follows: | |||||
December 31, | December 31, | ||||
2013 | 2012 | ||||
Revenues | $ - | $ 477,298 | |||
Cost of revenues | - | (163,487) | |||
Gross profit | - | 313,811 | |||
Selling, general and administrative | - | (319,976) | |||
Loss from operations | - | (6,165) | |||
Other expense | - | (295) | |||
Net loss from discontinued operations | $ - | $ (6,460) | |||
22_Subsequent_Events
(22) Subsequent Events | 3 Months Ended |
Dec. 31, 2013 | |
Notes | ' |
(22) Subsequent Events | ' |
(22) SUBSEQUENT EVENTS | |
The Company evaluated subsequent events through the date the accompanying consolidated financial statements were issued. Subsequent to December 31, 2013, the following events occurred: | |
1) The Company issued to directors for services rendered during the first fiscal quarter ended December 31, 2013, warrants to purchase 5,860 shares of Common Stock with an exercise price of $19.29 per share, valued at the date of grant at $30,035 using the Black-Scholes model. | |
2) 496 shares of common stock were issued for first quarter Series D Preferred stock dividends, valued at $9,427. | |
3) 1,173 shares of common stock were issued to several directors for services rendered, valued at $22,500. | |
4) 134 shares of common stock were issued from the cashless exercise of employee options, valued at $2,600. | |
5) On January 3, 2014, the Company entered into an unsecured Facility Agreement with Tetra House Pte. Ltd., a related-party entity, controlled by the Company’s Chairman, Guy Dubois. Under this agreement, the Company may borrow up to $25,000,000 for working capital and acquisitions purposes. The loan bears interest at a rate of 8 percent per annum, payable in arrears semi-annually, with all principal and accrued and unpaid interest due on January 3, 2016. In addition, the Company agreed to pay Tetra House an arrangement fee equal to 3 percent of the aggregate maximum amount under the loan. After the loan was executed, Tetra House assigned the Facility Agreement to Conrent Invest S.A. Since January 3, 2014, the Company borrowed $10,000,000 under the Facility Agreement. | |
6) On January 16, 2014, the Company sent notices of redemption to holders of 261 shares of Series D Preferred stock of the Company. Pursuant to Section 10(c) of the Designation of Rights and Preferences the Company has the right to redeem Series D Preferred shares for cash at 120 percent of the original issue price at any time after December 1, 2010. The date of redemption has been set as February 13, 2014. The redemption by the Company is subject to the right of the Series D shareholder to convert the shares of Series D Preferred stock into common stock by giving notice of conversion prior to the date of redemption. If all 261 shares of Series D Preferred stock are redeemed by the Company, the cost to the Company will be $312,008. | |
7) On February 10, 2014, the Company entered into a non-binding letter of intent to acquire all of the issued and outstanding stock of Emerge Monitoring, Inc, a Florida corporation and all of its subsidiaries and affiliate entities. The parties are currently negotiating a definitive agreement for the stock purchase; compensation for the stock will be a combination of cash and our common stock. It is the intent of the parties to close the transaction as soon as possible. |
6_Net_Loss_Per_Common_Share_Ea
(6) Net Loss Per Common Share: Earnings per share (Policies) | 3 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Earnings per share | ' |
Basic net loss per common share ("Basic EPS") is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding during the period. | |
Diluted net loss per common share ("Diluted EPS") is computed by dividing net loss attributable to common shareholders by the sum of the weighted-average number of common shares outstanding and the weighted-average dilutive common share equivalents outstanding. The computation of Diluted EPS does not assume exercise or conversion of securities that would have an anti-dilutive effect. |
8_Inventory_Inventory_Policies
(8) Inventory: Inventory (Policies) | 3 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Inventory | ' |
Inventory is valued at the lower of the cost or market. Cost is determined using the first-in, first-out (“FIFO”) method. Market is determined based on the estimated net realizable value, which generally is the item selling price. Inventory is periodically reviewed in order to identify obsolete or damaged items or impaired values. | |
5_Geographic_Information_Sched
(5) Geographic Information: Schedule of Revenue from External Customers Attributed to Foreign Countries by Geographic Area (Tables) | 3 Months Ended | |||
Dec. 31, 2013 | ||||
Tables/Schedules | ' | |||
Schedule of Revenue from External Customers Attributed to Foreign Countries by Geographic Area | ' | |||
31-Dec-13 | 31-Dec-12 | |||
United States of America | $ 1,884,164 | $ 1,768,366 | ||
Latin American Countries | - | 3,018,477 | ||
Caribbean Countries and Commonwealths | 756,678 | 786,530 | ||
Other Foreign Countries | 18,452 | 14,699 | ||
Total | $ 2,659,294 | $ 5,588,072 | ||
5_Geographic_Information_Sched1
(5) Geographic Information: Schedule of Disclosure on Geographic Areas, Long-Lived Assets in Individual Foreign Countries by Country (Tables) | 3 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Tables/Schedules | ' | |||||||
Schedule of Disclosure on Geographic Areas, Long-Lived Assets in Individual Foreign Countries by Country | ' | |||||||
Net Property and Equipment | Net Monitoring Equipment | |||||||
31-Dec-13 | 30-Sep-13 | 31-Dec-13 | 30-Sep-13 | |||||
United States of America | $ 306,579 | $ 318,201 | $ 1,437,866 | $ 878,823 | ||||
Latin American Countries | - | - | - | - | ||||
Caribbean Countries and Commonwealths | 8,391 | - | 155,263 | 351,138 | ||||
Other Foreign Countries | 18,138 | - | 7,051 | 6,735 | ||||
Total | $ 333,108 | $ 318,201 | $ 1,600,180 | $ 1,236,696 |
6_Net_Loss_Per_Common_Share_Sc
(6) Net Loss Per Common Share: Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Tables) | 3 Months Ended | ||||
Dec. 31, 2013 | |||||
Tables/Schedules | ' | ||||
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | ' | ||||
31-Dec-13 | 31-Dec-12 | ||||
Conversion of debt and accrued interest | - | 586,070 | |||
Conversion of Series D Preferred stock | 24,503 | 1,462,890 | |||
Exercise of outstanding common stock options and warrants | 399,591 | 336,532 | |||
Exercise and conversion of outstanding Series D Preferred | |||||
stock warrants | 42,000 | 162,000 | |||
Total common stock equivalents | 466,094 | 2,547,492 |
8_Inventory_Schedule_of_Invent
(8) Inventory: Schedule of Inventory, Current (Tables) | 3 Months Ended | ||||
Dec. 31, 2013 | |||||
Tables/Schedules | ' | ||||
Schedule of Inventory, Current | ' | ||||
December 31, | September 30, | ||||
2013 | 2013 | ||||
Raw materials | $ 892,655 | $ 615,144 | |||
Reserve for damaged or obsolete inventory | (252,114) | (148,043) | |||
Total inventory, net of reserves | $ 640,541 | $ 467,101 |
9_Property_and_Equipment_Prope
(9) Property and Equipment: Property, Plant and Equipment (Tables) | 3 Months Ended | ||||
Dec. 31, 2013 | |||||
Tables/Schedules | ' | ||||
Property, Plant and Equipment | ' | ||||
December 31, | September 30, | ||||
2013 | 2013 | ||||
Equipment, software and tooling | $ 2,064,657 | $ 2,002,577 | |||
Automobiles | 33,466 | 33,466 | |||
Leasehold improvements | 127,162 | 127,162 | |||
Furniture and fixtures | 247,218 | 247,218 | |||
Total property and equipment before accumulated depreciation | 2,472,503 | 2,410,423 | |||
Accumulated depreciation | (2,139,395) | (2,092,222) | |||
Property and equipment, net of accumulated depreciation | $ 333,108 | $ 318,201 |
10_Monitoring_Equipment_Schedu
(10) Monitoring Equipment: Schedule Of Monitoring Property And Equipment (Tables) | 3 Months Ended | ||||
Dec. 31, 2013 | |||||
Tables/Schedules | ' | ||||
Schedule Of Monitoring Property And Equipment | ' | ||||
December 31, | September 30, | ||||
2013 | 2013 | ||||
Monitoring equipment | $ 2,839,092 | $ 2,420,042 | |||
Less: accumulated depreciation | (1,238,912) | (1,183,346) | |||
Monitoring equipment, net of accumulated depreciation | $ 1,600,180 | $ 1,236,696 |
11_Intangible_Assets_Schedule_
(11) Intangible Assets: Schedule of Intangible Assets (Tables) | 3 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Tables/Schedules | ' | |||||||
Schedule of Intangible Assets | ' | |||||||
Borinquen Container Corporation | International Surveillance Services Corp. | Patent | Total | |||||
Intangible assets: | ||||||||
Patent license agreement | $ - | $ - | $ 50,000 | $ 50,000 | ||||
Royalty agreement | 11,616,984 | 5,003,583 | - | 16,620,567 | ||||
Total intangible assets | 11,616,984 | 5,003,583 | 50,000 | 16,670,567 | ||||
Accumulated amortization | (831,072) | (625,448) | (21,759) | (1,478,279) | ||||
Intangible assets, net of accumulated amortization | $10,785,912 | $ 4,378,135 | $ 28,241 | $15,192,288 |
13_Accrued_Expenses_Schedule_O
(13) Accrued Expenses: Schedule Of Accrued Expenses (Tables) | 3 Months Ended | ||||
Dec. 31, 2013 | |||||
Tables/Schedules | ' | ||||
Schedule Of Accrued Expenses | ' | ||||
December 31, | September 30, | ||||
2013 | 2013 | ||||
Accrued royalties | $ 843,676 | $ 714,400 | |||
Accrued payroll, taxes and employee benefits | 493,623 | 473,179 | |||
Accrued consulting | 308,324 | 317,300 | |||
Accrued taxes - foreign and domestic | 91,101 | 262,880 | |||
Accrued travel | 82,080 | 50,000 | |||
Accrued legal costs | 78,070 | 57,001 | |||
Accrued settlement costs | 70,000 | 76,000 | |||
Accrued interest | 63,793 | 27,394 | |||
Accrued board of directors fees | 60,000 | 68,090 | |||
Accrued cellular costs | 57,630 | 55,000 | |||
Accrued outside services | 39,728 | 33,022 | |||
Accrued warranty and manufacturing costs | 30,622 | 30,622 | |||
Accrued other expenses | 14,952 | 15,903 | |||
Total accrued expenses | $ 2,233,599 | $ 2,180,791 |
14_Debt_Obligations_Schedule_o
(14) Debt Obligations: Schedule of Debt (Tables) | 3 Months Ended | ||||||
Dec. 31, 2013 | |||||||
Tables/Schedules | ' | ||||||
Schedule of Debt | ' | ||||||
December 31, | September 30, | ||||||
2013 | 2013 | ||||||
Note issued in connection with the acquisition of a subsidiary and matures in December 2014. | $ 51,230 | $ 64,111 | |||||
Capital leases with effective interest rates that range between 8.51% and 17.44%. Leases mature between June 2015 and November 2015. $154,410 was assumed through the sale of Midwest Monitoring & Surveillance, Inc. to its former owners. | 51,734 | 59,266 | |||||
Automobile loan with a financial institution secured by the vehicle. Interest rate is 7.06%, due June 2014. | 3,501 | 5,306 | |||||
Total debt obligations | 106,465 | 128,683 | |||||
Less current portion | (87,115) | (88,095) | |||||
Long-term debt, net of current portion | $ 19,350 | $ 40,588 |
15_Relatedparty_Transactions_S
(15) Related-party Transactions: Schedule of Related Party Transactions (Tables) | 3 Months Ended | ||||||
Dec. 31, 2013 | |||||||
Tables/Schedules | ' | ||||||
Schedule of Related Party Transactions | ' | ||||||
December 31, | September 30, | ||||||
2013 | 2013 | ||||||
Loan from a significant shareholder with an interest rate of 10% per annum. Principal and interest due at maturity on June 30, 2014. | $ 1,200,000 | $ - | |||||
Promissory note with a significant shareholder with an interest rate of 8% per annum. Principal and interest due at maturity on November 19, 2014. | 1,500,000 | - | |||||
Convertible debenture of $16,700,000 from a significant shareholder with an interest rate of 8% per annum. On September 30, 2013, $16,640,000 plus accrued interest of $936,627 was converted into 3,905,917 shares of common stock and in October 2013, the Company paid $60,000 in cash to pay off the debenture. | - | 60,000 | |||||
Total related-party debt obligations | 2,700,000 | 60,000 | |||||
Less current portion | (2,700,000) | (60,000) | |||||
Long-term debt, net of current portion | $ - | $ - |
18_Stock_Options_and_Warrants_
(18) Stock Options and Warrants: Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions (Tables) | 3 Months Ended | ||||
Dec. 31, 2013 | |||||
Tables/Schedules | ' | ||||
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | ' | ||||
Three Months Ended December 31, | |||||
2013 | 2012 | ||||
Expected cash dividend yield | - | - | |||
Expected stock price volatility | 103% | - | |||
Risk-free interest rate | 0.10% | - | |||
Expected life of options/warrants | 1 Year | - |
18_Stock_Options_and_Warrants_1
(18) Stock Options and Warrants: Schedule of Stock Options Roll Forward (Tables) | 3 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Tables/Schedules | ' | ||||||||
Schedule of Stock Options Roll Forward | ' | ||||||||
Shares Under Option/ Warrant | Weighted Average Exercise Price | Weighted Average Remaining Contractual Life | Aggregate Intrinsic Value | ||||||
Outstanding as of September 30, 2013 | 427,965 | $ 16.12 | |||||||
Granted | 6,840 | $ 19.46 | |||||||
Expired / Cancelled | - | $ - | |||||||
Exercised | (35,214) | $ 16.43 | |||||||
Outstanding as of December 31, 2013 | 399,591 | $ 16.15 | 1.16 years | $1,640,319 | |||||
Exercisable as of December 31, 2013 | 380,730 | $ 16.50 | 1.15 years | $1,446,243 |
19_Changes_in_Equity_Schedule_
(19) Changes in Equity: Schedule of Stockholders Equity (Tables) | 3 Months Ended | ||
Dec. 31, 2013 | |||
Tables/Schedules | ' | ||
Schedule of Stockholders Equity | ' | ||
Total Equity | |||
Balance at September 30, 2013 | $ 23,963,342 | ||
Issuance of common stock for: | |||
Dividends from Series D Preferred stock | 9,427 | ||
Board of Director fees | 15,000 | ||
Exercise of options and warrants | 8,000 | ||
Vesting of stock options and warrants | 71,250 | ||
Series D Preferred dividends | (9,427) | ||
Issuance of warrants for Board of Director fees | 53,946 | ||
Net loss | (1,270,193) | ||
Balance at December 31, 2013 | $ 22,841,345 |
21_Discontinued_Operations_Sch
(21) Discontinued Operations: Schedule Of Operating Results Of Discontinued Operations (Tables) | 3 Months Ended | ||||
Dec. 31, 2013 | |||||
Tables/Schedules | ' | ||||
Schedule Of Operating Results Of Discontinued Operations | ' | ||||
December 31, | December 31, | ||||
2013 | 2012 | ||||
Revenues | $ - | $ 477,298 | |||
Cost of revenues | - | (163,487) | |||
Gross profit | - | 313,811 | |||
Selling, general and administrative | - | (319,976) | |||
Loss from operations | - | (6,165) | |||
Other expense | - | (295) | |||
Net loss from discontinued operations | $ - | $ (6,460) |
5_Geographic_Information_Sched2
(5) Geographic Information: Schedule of Revenue from External Customers Attributed to Foreign Countries by Geographic Area (Details) (USD $) | 3 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Revenue, Net | $2,659,294 | $5,588,072 |
UnitedStatesOfAmericaMember | ' | ' |
Revenue, Net | 1,884,164 | 1,768,366 |
LatinAmericanCountriesMember | ' | ' |
Revenue, Net | ' | 3,018,477 |
CaribbeanCountriesAndCommonwealthMember | ' | ' |
Revenue, Net | 756,678 | 786,530 |
OtherForeignCountriesMember | ' | ' |
Revenue, Net | $18,452 | $14,699 |
5_Geographic_Information_Sched3
(5) Geographic Information: Schedule of Disclosure on Geographic Areas, Long-Lived Assets in Individual Foreign Countries by Country (Details) (USD $) | Dec. 31, 2013 | Sep. 30, 2013 |
Property and equipment, net of accumulated depreciation of $2,139,395 and $2,092,222, respectively | $333,108 | $318,201 |
Monitoring equipment, net of accumulated amortization of $1,238,912 and $1,183,346, respectively | 1,600,180 | 1,236,696 |
UnitedStatesOfAmericaMember | ' | ' |
Property and equipment, net of accumulated depreciation of $2,139,395 and $2,092,222, respectively | 306,579 | 318,201 |
Monitoring equipment, net of accumulated amortization of $1,238,912 and $1,183,346, respectively | 1,437,866 | 878,823 |
CaribbeanCountriesAndCommonwealthMember | ' | ' |
Property and equipment, net of accumulated depreciation of $2,139,395 and $2,092,222, respectively | 8,391 | ' |
Monitoring equipment, net of accumulated amortization of $1,238,912 and $1,183,346, respectively | 155,263 | 351,138 |
OtherForeignCountriesMember | ' | ' |
Property and equipment, net of accumulated depreciation of $2,139,395 and $2,092,222, respectively | 18,138 | ' |
Monitoring equipment, net of accumulated amortization of $1,238,912 and $1,183,346, respectively | $7,051 | $6,735 |
6_Net_Loss_Per_Common_Share_De
(6) Net Loss Per Common Share (Details) | 3 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Details | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 466,094 | 2,547,492 |
6_Net_Loss_Per_Common_Share_Sc1
(6) Net Loss Per Common Share: Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Details | ' | ' |
Conversion of debt and accrued interest | ' | $586,070 |
Conversion of Series D Preferred stock | 24,503 | 1,462,890 |
Exercise of outstanding common stock options and warrants | 399,591 | 336,532 |
Exercise and conversion of outstanding Series D Preferred stock warrants | 42,000 | 162,000 |
Total common stock equivalents | $466,094 | $2,547,492 |
7_Prepaid_and_Other_Expenses_D
(7) Prepaid and Other Expenses (Details) (USD $) | Dec. 31, 2013 | Sep. 30, 2013 |
Details | ' | ' |
Prepaid expenses and other | $2,230,328 | $1,783,805 |
Bond posted for an international customer | $1,488,778 | ' |
8_Inventory_Schedule_of_Invent1
(8) Inventory: Schedule of Inventory, Current (Details) (USD $) | Dec. 31, 2013 | Sep. 30, 2013 |
Details | ' | ' |
Inventory, Raw Materials, Gross | $892,655 | $615,144 |
Reserve for damaged or obsolete inventory | -252,114 | -148,043 |
Inventory, net of reserves of $252,114 and $148,043, respectively | $640,541 | $467,101 |
9_Property_and_Equipment_Prope1
(9) Property and Equipment: Property, Plant and Equipment (Details) (USD $) | Dec. 31, 2013 | Sep. 30, 2013 |
Details | ' | ' |
Equipment, software and tooling | $2,064,657 | $2,002,577 |
Automobiles | 33,466 | 33,466 |
Leasehold Improvements, Gross | 127,162 | 127,162 |
Furniture And Fixtures | 247,218 | 247,218 |
Property, Plant and Equipment, Gross | 2,472,503 | 2,410,423 |
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | -2,139,395 | -2,092,222 |
Property and equipment, net of accumulated depreciation of $2,139,395 and $2,092,222, respectively | $333,108 | $318,201 |
9_Property_and_Equipment_Detai
(9) Property and Equipment (Details) (USD $) | 3 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Details | ' | ' |
Depreciation | $47,175 | $67,156 |
Impaired Assets to be Disposed of by Method Other than Sale, Amount of Impairment Loss | $0 | $1,365 |
10_Monitoring_Equipment_Schedu1
(10) Monitoring Equipment: Schedule Of Monitoring Property And Equipment (Details) (USD $) | Dec. 31, 2013 | Sep. 30, 2013 |
Details | ' | ' |
Property Subject to or Available for Operating Lease, Gross | $2,839,092 | $2,420,042 |
Property Subject to or Available for Operating Lease, Accumulated Depreciation | -1,238,912 | -1,183,346 |
Monitoring equipment, net of accumulated amortization of $1,238,912 and $1,183,346, respectively | $1,600,180 | $1,236,696 |
10_Monitoring_Equipment_Detail
(10) Monitoring Equipment (Details) (USD $) | 3 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Details | ' | ' |
Depreciation Expense | $190,992 | $324,246 |
Reserve for future monitoring equipment impairment | 75,000 | ' |
Disposal of lease monitoring equipment | $10,771 | $31,851 |
11_Intangible_Assets_Schedule_1
(11) Intangible Assets: Schedule of Intangible Assets (Details) (USD $) | Dec. 31, 2013 |
Patent license agreement | $50,000 |
FiniteLivedRoyaltyAgreement | 16,620,567 |
Finite-Lived Intangible Assets, Net | 16,670,567 |
Accumulated amortization | -1,478,279 |
Intangible assets, net of accumulated amortization | 15,192,288 |
Borinquen Container Corporation | ' |
FiniteLivedRoyaltyAgreement | 11,616,984 |
Finite-Lived Intangible Assets, Net | 11,616,984 |
Accumulated amortization | -831,072 |
Intangible assets, net of accumulated amortization | 10,785,912 |
International Surveillance Services Corp | ' |
FiniteLivedRoyaltyAgreement | 5,003,583 |
Finite-Lived Intangible Assets, Net | 5,003,583 |
Accumulated amortization | -625,448 |
Intangible assets, net of accumulated amortization | 4,378,135 |
Patent | ' |
Patent license agreement | 50,000 |
Finite-Lived Intangible Assets, Net | 50,000 |
Accumulated amortization | -21,759 |
Intangible assets, net of accumulated amortization | $28,241 |
11_Intangible_Assets_Details
(11) Intangible Assets (Details) (USD $) | 3 Months Ended |
Dec. 31, 2013 | |
Borinquen Container Corporation | ' |
Amortization of Intangible Assets | $157,698 |
International Surveillance Services Corp | ' |
Amortization of Intangible Assets | 62,545 |
Patent | ' |
Amortization of Intangible Assets | $1,389 |
12_Other_Assets_Details
(12) Other Assets (Details) (USD $) | 3 Months Ended | |
Dec. 31, 2013 | Sep. 30, 2013 | |
Details | ' | ' |
Other Assets, Noncurrent | $3,516,650 | $170,172 |
Cash deposited in escrow to secure international bond | $3,346,622 | ' |
13_Accrued_Expenses_Schedule_O1
(13) Accrued Expenses: Schedule Of Accrued Expenses (Details) (USD $) | Dec. 31, 2013 | Sep. 30, 2013 |
Details | ' | ' |
Accrued Royalties, Current | $843,676 | $714,400 |
Accrued payroll, taxes and employee benefits | 493,623 | 473,179 |
Accrued Professional Fees, Current | 308,324 | 317,300 |
Value added and business flat taxes | 91,101 | 262,880 |
Accrued travel costs | 82,080 | 50,000 |
Legal costs | 78,070 | 57,001 |
Settlement costs | 70,000 | 76,000 |
Accrued interest | 63,793 | 27,394 |
Board of Directors fees | 60,000 | 68,090 |
Accrued cellular costs | 57,630 | 55,000 |
Accrued outside services | 39,728 | 33,022 |
Warranty and manufacturing costs | 30,622 | 30,622 |
Accrued other expenses | 14,952 | 15,903 |
Accrued liabilities | $2,233,599 | $2,180,791 |
14_Debt_Obligations_Schedule_o1
(14) Debt Obligations: Schedule of Debt (Details) (USD $) | Dec. 31, 2013 | Sep. 30, 2013 | ||
Details | ' | ' | ||
Note payable | $51,230 | $64,111 | ||
Capital Lease Obligations | 51,734 | [1] | 59,266 | [1] |
Automobile loans | 3,501 | [2] | 5,306 | [2] |
Total debt obligations | 106,465 | 128,683 | ||
Current portion of long-term debt | -87,115 | -88,095 | ||
Long-term debt, net of current portion | $19,350 | $40,588 | ||
[1] | Effective interest rates that range between 8.51% and 17.44%. Leases mature between June 2015 and November 2015. | |||
[2] | Secured by vehicles. Interest rate is 7.06%, due June 2014. |
15_Relatedparty_Transactions_D
(15) Related-party Transactions (Details) (USD $) | Dec. 31, 2013 | Sep. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Jan. 03, 2014 |
Related Party - Loan Agreement | Related Party - Loan Agreement | Related Party - Promissory Note | Related Party - Facility Agreement | Related Party - Facility Agreement | |||
Line of Credit Facility, Maximum Borrowing Capacity | ' | ' | ' | $1,200,000 | ' | ' | $25,000,000 |
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | ' | ' | 3.00% | ' | ' | ' | ' |
Line of Credit Facility, Interest Rate During Period | ' | ' | 10.00% | ' | 8.00% | 8.00% | ' |
Due to Related Parties | 2,700,000 | 60,000 | 1,200,000 | ' | 1,500,000 | ' | 10,000,000 |
Accrued liabilities | $2,233,599 | $2,180,791 | $49,316 | ' | $14,137 | ' | ' |
15_Relatedparty_Transactions_S1
(15) Related-party Transactions: Schedule of Related Party Transactions (Details) (USD $) | Dec. 31, 2013 | Sep. 30, 2013 |
Due to Related Parties | $2,700,000 | $60,000 |
Current portion of long-term related-party debt | -2,700,000 | -60,000 |
Related Party - Loan Agreement | ' | ' |
Due to Related Parties | 1,200,000 | ' |
Related Party - Promissory Note | ' | ' |
Due to Related Parties | 1,500,000 | ' |
Related Party - Convertible Debenture | ' | ' |
Due to Related Parties | ' | $60,000 |
16_Preferred_Stock_Details
(16) Preferred Stock (Details) (USD $) | 3 Months Ended | ||
Dec. 31, 2013 | Sep. 30, 2013 | Jul. 31, 2011 | |
Details | ' | ' | ' |
Preferred stock shares authorized | 20,000,000 | ' | ' |
Series D 8% dividend, convertible, voting - par value | $0.00 | $0.00 | ' |
Series D 8% dividend, convertible, voting - shares designated | 85,000 | 85,000 | 85,000 |
Series D 8% dividend, convertible, voting - shares outstanding | 468 | 468 | ' |
16_Preferred_Stock_Dividends_D
(16) Preferred Stock: Dividends (Details) (USD $) | 1 Months Ended | 3 Months Ended | |
Jan. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Details | ' | ' | ' |
Dividend rate on Series D Preferred stock | ' | 8.00% | ' |
Common stock issued for payment of Series D preferred stock dividends | ' | 483 | 103,808 |
Issuance of shares of common stock in connection with Series D Preferred stock dividends | $9,427 | $9,427 | $630,528 |
Common Shares Issued As Payment Of Series D Dividends | 496 | 496 | ' |
16_Preferred_Stock_Convertibil
(16) Preferred Stock: Convertibility (Details) | 1 Months Ended | |
Feb. 28, 2013 | Dec. 31, 2013 | |
Details | ' | ' |
Common shares issued for each share of Series D Preferred stock | ' | 30 |
Exchange Offer Number of Series D Preferred Converted to Common Stock Shares | 24,503 | ' |
16_Preferred_Stock_Redemption_
(16) Preferred Stock: Redemption (Details) (USD $) | Jan. 16, 2014 |
Details | ' |
Redeemable Shares of Series D Preferred Stock | 261 |
Original Investment of Redeemable Shares of Series D Preferred Stock | $260,007 |
Cash Value of Redeemable Shares of Series D Preferred Stock | $312,008 |
16_Preferred_Stock_Series_D_Pr
(16) Preferred Stock: Series D Preferred Stock Purchase Warrants (Details) (USD $) | Dec. 31, 2013 |
Details | ' |
Warrants outstanding for the purchase of Series D Preferred stock | 1,400 |
Warrants Outstanding For The Purchase Of Series D Preferred Stock Exercise0020Price | $500 |
17_Common_Stock_Details
(17) Common Stock (Details) (USD $) | 1 Months Ended | 3 Months Ended | |
Jan. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Details | ' | ' | ' |
Stockholders' Equity, Reverse Stock Split | ' | '200 for 1 | ' |
Common stock shares authorized prior to amendment | ' | 15,000,000 | ' |
Issuance of 483 and 103,808 shares of common stock in connection with Series D Preferred stock dividends | ' | $9,427 | $630,528 |
Board of Director Fees | ' | 15,000 | ' |
Exercise of options and warrants | ' | 8,000 | ' |
Common Shares Issued As Payment Of Series D Dividends | 496 | 496 | ' |
Series D Preferred stock dividends earned | ' | $9,427 | $630,330 |
18_Stock_Options_and_Warrants_2
(18) Stock Options and Warrants (Details) (USD $) | 3 Months Ended | |||
Dec. 31, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Dec. 21, 2011 | |
Details | ' | ' | ' | ' |
Shares authorized for issuance under 2012 Plan | ' | ' | ' | 90,000 |
Options available to distribute under 2012 Plan | 60,000 | ' | ' | ' |
Beneficial conversion feature expense third party | $53,946 | $53,947 | ' | ' |
Compensation Expense associated with unvest stock options and warrants will be recognized over the next year | 83,128 | ' | ' | ' |
Expenses related to the granting and vesting of all stock options and warrants | $125,196 | ' | $7,344 | ' |
18_Stock_Options_and_Warrants_3
(18) Stock Options and Warrants: Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions (Details) | 3 Months Ended |
Dec. 31, 2013 | |
Details | ' |
Expected stock price volatility | 103.00% |
Risk free interest rate | 0.10% |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term | '1 year |
18_Stock_Options_and_Warrants_4
(18) Stock Options and Warrants: Schedule of Stock Options Roll Forward (Details) (USD $) | 3 Months Ended | |
Dec. 31, 2013 | Sep. 30, 2013 | |
Details | ' | ' |
Options outstanding | 427,965 | ' |
Weighted average exercise price of options outstanding | $16.15 | $16.12 |
Options granted | 6,840 | ' |
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $19.46 | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value | ($35,214) | ' |
Share-based Compensation Arrangements by Share-based Payment Award, Options, Exercises in Period, Weighted Average Exercise Price | $16.43 | ' |
Options outstanding | 399,591 | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term | '1 year 1 month 28 days | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Intrinsic Value | 1,640,319 | ' |
Options exercisable | 380,730 | ' |
Weighted average exercise price of exercisable options | $16.50 | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Remaining Contractual Term | '1 year 1 month 24 days | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Intrinsic Value | $1,446,243 | ' |
19_Changes_in_Equity_Schedule_1
(19) Changes in Equity: Schedule of Stockholders Equity (Details) (USD $) | 3 Months Ended | |
Dec. 31, 2013 | Sep. 30, 2013 | |
Details | ' | ' |
Total equity | $23,963,342 | ' |
Issuance Of Common Stock Due To Conversion Of Preferred Stock | 9,427 | ' |
Board of Director Fees | 15,000 | ' |
Exercise of options and warrants | 8,000 | ' |
Vesting of stock options and warrants | 71,250 | ' |
Series D Preferred stock dividends earned | -9,427 | ' |
Beneficial conversion feature expense third party | 53,946 | 53,947 |
Net loss | -1,270,193 | ' |
Total equity | $22,841,345 | $23,963,342 |
20_Commitments_and_Contingenci1
(20) Commitments and Contingencies (Details) | 3 Months Ended |
Mar. 31, 2013 | |
Details | ' |
Complaint seeking damages | '$210,000 |
21_Discontinued_Operations_Sch1
(21) Discontinued Operations: Schedule Of Operating Results Of Discontinued Operations (Details) (USD $) | 3 Months Ended |
Dec. 31, 2012 | |
Details | ' |
Disposal Group, Including Discontinued Operation, Revenue | $477,298 |
Disposal Group, Including Discontinued Operation, Costs of Goods Sold | -163,487 |
Disposal Group, Including Discontinued Operation, Gross Profit (Loss) | 313,811 |
Disposal Group Including Discontinued Operation Selling General and Administrative | -319,976 |
Disposal Group Including Discontinued Operation Income From Operations | -6,165 |
Disposal Group, Including Discontinued Operation, Other Income | -295 |
Disposal Group Including Discontinued Operation Net Income | ($6,460) |
22_Subsequent_Events_Details
(22) Subsequent Events (Details) (USD $) | 1 Months Ended | 3 Months Ended | ||||
Jan. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Jan. 16, 2014 | Sep. 30, 2013 | Jan. 03, 2014 | |
Related Party - Facility Agreement | ||||||
Warrants Issued to Board of Directors for Services Rendered - Warrants | 5,860 | ' | ' | ' | ' | ' |
Warrants Issued to Board of Directors for Services Rendered - Exercise Price | $19.29 | ' | ' | ' | ' | ' |
Warrants Issued to Board of Directors for Services Rendered | $30,035 | ' | ' | ' | ' | ' |
Common Shares Issued As Payment Of Series D Dividends | 496 | 496 | ' | ' | ' | ' |
Issuance of shares of common stock in connection with Series D Preferred stock dividends | 9,427 | 9,427 | 630,528 | ' | ' | ' |
Common Stock Issued to Several Directors for Services Rendered | 1,173 | ' | ' | ' | ' | ' |
Shares of Common Stock Issued to Several Directors for Services Rendered | 22,500 | ' | ' | ' | ' | ' |
Common Stock Issued from the cashless exercise of employee options | 134 | ' | ' | ' | ' | ' |
Shares of Common Stock Issued from the cashless exercise of employee options | 2,600 | ' | ' | ' | ' | ' |
Line of Credit Facility, Maximum Borrowing Capacity | ' | ' | ' | ' | ' | 25,000,000 |
Due to Related Parties | ' | 2,700,000 | ' | ' | 60,000 | 10,000,000 |
Redeemable Shares of Series D Preferred Stock | ' | ' | ' | 261 | ' | ' |
Cash Value of Redeemable Shares of Series D Preferred Stock | ' | ' | ' | $312,008 | ' | ' |