Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Jun. 30, 2015 | Sep. 15, 2015 | Dec. 31, 2014 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | USA TECHNOLOGIES INC | ||
Entity Central Index Key | 896,429 | ||
Trading Symbol | usat | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Current Fiscal Year End Date | --06-30 | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Common Stock, Shares Outstanding | 35,854,655 | ||
Entity Public Float | $ 55,098,386 | ||
Document Type | 10-K | ||
Document Period End Date | Jun. 30, 2015 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Jun. 30, 2015 | Jun. 30, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 11,373,973 | $ 9,072,320 |
Accounts receivable, less allowance for uncollectible accounts of $494,000 and $63,000, respectively | 4,671,544 | 2,683,579 |
Finance receivables | 941,150 | 119,793 |
Inventory | 4,216,396 | 1,486,777 |
Prepaid expenses and other current assets | 574,479 | 363,367 |
Deferred income taxes | 1,257,796 | 907,691 |
Total current assets | 23,035,338 | 14,633,527 |
Finance receivables, less current portion | 3,697,513 | 352,794 |
Other assets | 350,041 | 190,703 |
Property and equipment, net | 12,868,808 | 21,138,580 |
Deferred income taxes | 25,788,187 | 26,353,330 |
Intangibles, net | 432,100 | 432,100 |
Goodwill | 7,663,208 | 7,663,208 |
Total assets | 73,835,195 | 70,764,242 |
Current liabilities: | ||
Accounts payable | 9,242,672 | 7,753,911 |
Accrued expenses | 2,107,530 | 1,915,799 |
Line of credit | 4,000,000 | 5,000,000 |
Current obligations under long-term debt | 477,522 | 172,911 |
Income taxes payable | 54,086 | 21,021 |
Deferred gain from sale-leaseback transactions | 860,391 | 380,895 |
Total current liabilities | 16,742,201 | 15,244,537 |
Long-term liabilities: | ||
Long-term debt, less current portion | 1,854,424 | 249,865 |
Accrued expenses, less current portion | 49,160 | 186,174 |
Warrant liabilities | 978,353 | 585,209 |
Deferred gain from sale-leaseback transactions, less current portion | 900,348 | 761,790 |
Total long-term liabilities | 3,782,285 | 1,783,038 |
Total liabilities | $ 20,524,486 | $ 17,027,575 |
Commitments and contingencies | ||
Shareholders' equity: | ||
Preferred stock, no par value: Authorized shares- 1,800,000 Series A convertible preferred- Authorized shares- 900,000 Issued and outstanding shares- 442,968 (liquidation preference of $17,354,908 and $16,690,456, respectively) | $ 3,138,056 | $ 3,138,056 |
Common stock, no par value: Authorized shares- 640,000,000 Issued and outstanding shares- 35,747,242 and 35,514,685, respectively | 224,873,721 | 224,210,197 |
Accumulated deficit | (174,701,068) | (173,611,586) |
Total shareholders' equity | 53,310,709 | 53,736,667 |
Total liabilities and shareholders' equity | $ 73,835,195 | $ 70,764,242 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - USD ($) | Jun. 30, 2015 | Jun. 30, 2014 |
Allowance for uncollectible accounts receivable (in dollars) | $ 494,000 | $ 63,000 |
Preferred stock, no par value (in dollars per share) | ||
Preferred stock, shares authorized | 1,800,000 | 1,800,000 |
Common stock, no par value (in dollars per share) | ||
Common stock, shares authorized | 640,000,000 | 640,000,000 |
Common stock, shares issued | 35,747,242 | 35,514,685 |
Common stock, shares outstanding | 35,747,242 | 35,514,685 |
Series A Convertible Preferred Stock | ||
Preferred stock, shares authorized | 900,000 | 900,000 |
Preferred stock, shares issued | 442,968 | 442,968 |
Preferred stock, shares outstanding | 442,968 | 442,968 |
Preferred stock, liquidation preference value (in dollars) | $ 17,354,908 | $ 16,690,456 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Revenues: | |||
License and transaction fees | $ 43,633,462 | $ 35,638,121 | $ 30,044,429 |
Equipment sales | 14,444,012 | 6,706,843 | 5,895,815 |
Total revenues | 58,077,474 | 42,344,964 | 35,940,244 |
Costs: | |||
Cost of services | 29,429,385 | 23,018,001 | 18,219,945 |
Cost of equipment | 11,825,455 | 4,254,127 | 3,623,686 |
Total costs | 41,254,840 | 27,272,128 | 21,843,631 |
Gross profit | 16,822,634 | 15,072,836 | 14,096,613 |
Operating expenses: | |||
Selling, general and administrative | 16,451,255 | 14,036,016 | 12,068,566 |
Depreciation and amortization | 611,682 | 600,488 | 1,314,122 |
Total operating expenses | 17,062,937 | 14,636,504 | 13,382,688 |
Operating income (loss) | (240,303) | 436,332 | 713,925 |
Other income (expense): | |||
Interest income | 82,695 | 30,337 | 57,121 |
Other income | 52,178 | ||
Interest expense | (301,767) | (256,844) | (157,205) |
Change in fair value of warrant liabilities | (393,144) | 65,429 | 267,928 |
Total other income (expense), net | (560,038) | (161,078) | 167,844 |
Income (loss) before benefit (provision) for income taxes | (800,341) | 275,254 | 881,769 |
Benefit (provision) for income taxes | (289,141) | 27,255,398 | (27,646) |
Net income (loss) | (1,089,482) | 27,530,652 | 854,123 |
Cumulative preferred dividends | (664,452) | (664,452) | (664,452) |
Net income (loss) applicable to common shares | $ (1,753,934) | $ 26,866,200 | $ 189,671 |
Net earnings (loss) per common share - basic (in dollars per share) | $ (0.05) | $ 0.78 | $ 0.01 |
Basic weighted average number of common shares outstanding (in shares) | 35,663,386 | 34,613,497 | 32,787,673 |
Net earnings (loss) per common share - diluted (in dollars per share) | $ (0.05) | $ 0.78 | $ 0.01 |
Diluted weighted average number of common shares outstanding (in shares) | 35,663,386 | 34,613,497 | 33,613,346 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity - USD ($) | Series A ConvertiblePreferred Stock | Common Stock | Accumulated Deficit | Total |
Balance at Jun. 30, 2012 | $ 3,138,056 | $ 220,513,327 | $ (201,996,361) | $ 21,655,022 |
Balance (in shares) at Jun. 30, 2012 | 442,968 | 32,510,069 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Exercise of warrants | $ 432,229 | 432,229 | ||
Exercise of warrants (in shares) | 399,597 | |||
Warrants issued in conjunction with Line of Credit Amendment | $ 55,962 | 55,962 | ||
Stock based compensation 2010 Stock Incentive Plan | $ 68,723 | 68,723 | ||
Stock based compensation 2010 Stock Incentive Plan (in shares) | 62,942 | |||
Stock based compensation 2011 Stock Incentive Plan | $ 157,645 | 157,645 | ||
Stock based compensation 2011 Stock Incentive Plan (in shares) | 96,665 | |||
Stock based compensation 2012 Stock Incentive Plan | $ 276,539 | 276,539 | ||
Stock based compensation 2012 Stock Incentive Plan (In shares) | 279,806 | |||
Retirement of common stock | $ (121,052) | (121,052) | ||
Retirement of common stock (in shares) | (64,847) | |||
Net income (loss) | 854,123 | 854,123 | ||
Balance at Jun. 30, 2013 | $ 3,138,056 | $ 221,383,373 | (201,142,238) | 23,379,191 |
Balance (in shares) at Jun. 30, 2013 | 442,968 | 33,284,232 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Exercise of warrants | $ 2,361,956 | 2,361,956 | ||
Exercise of warrants (in shares) | 2,090,226 | |||
Stock based compensation 2010 Stock Incentive Plan | $ 6,024 | 6,024 | ||
Stock based compensation 2010 Stock Incentive Plan (in shares) | 6,668 | |||
Stock based compensation 2011 Stock Incentive Plan | $ 17,366 | 17,366 | ||
Stock based compensation 2011 Stock Incentive Plan (in shares) | 51,667 | |||
Stock based compensation 2012 Stock Incentive Plan | $ 278,471 | $ 278,471 | ||
Stock based compensation 2012 Stock Incentive Plan (In shares) | ||||
Stock based compensation 2013 Stock Incentive Plan | $ 227,180 | $ 227,180 | ||
Stock based compensation 2013 Stock Incentive Plan (in shares) | 131,203 | |||
Retirement of common stock | $ (89,020) | (89,020) | ||
Retirement of common stock (in shares) | (49,311) | |||
Excess tax benefits from stock-based compensation | $ 24,847 | 24,847 | ||
Net income (loss) | 27,530,652 | 27,530,652 | ||
Balance at Jun. 30, 2014 | $ 3,138,056 | $ 224,210,197 | (173,611,586) | 53,736,667 |
Balance (in shares) at Jun. 30, 2014 | 442,968 | 35,514,685 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Stock based compensation 2011 Stock Incentive Plan | $ 604 | 604 | ||
Stock based compensation 2011 Stock Incentive Plan (in shares) | 10,002 | |||
Stock based compensation 2012 Stock Incentive Plan | $ 51,941 | 51,941 | ||
Stock based compensation 2012 Stock Incentive Plan (In shares) | 88,991 | |||
Stock based compensation 2013 Stock Incentive Plan | $ 292,782 | 292,782 | ||
Stock based compensation 2013 Stock Incentive Plan (in shares) | 165,463 | |||
Stock based compensation 2014 Stock Incentive Plan | $ 370,435 | 370,435 | ||
Retirement of common stock | $ (61,987) | (61,987) | ||
Retirement of common stock (in shares) | (31,899) | |||
Excess tax benefits from stock-based compensation | $ 9,749 | 9,749 | ||
Net income (loss) | (1,089,482) | (1,089,482) | ||
Balance at Jun. 30, 2015 | $ 3,138,056 | $ 224,873,721 | $ (174,701,068) | $ 53,310,709 |
Balance (in shares) at Jun. 30, 2015 | 442,968 | 35,747,242 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
OPERATING ACTIVITIES: | |||
Net income (loss) | $ (1,089,482) | $ 27,530,652 | $ 854,123 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||
Stock based compensation | 715,762 | 529,041 | 502,907 |
(Gain) Loss on disposal of property and equipment | (17,357) | 4,245 | (20,343) |
Non-cash interest and amortization of debt discount | 2,095 | 53,867 | |
Bad debt expense | 1,099,528 | 134,176 | 68,615 |
Depreciation | $ 5,731,356 | 5,463,985 | 3,837,174 |
Amortization | 21,953 | 742,400 | |
Change in fair value of warrant liabilities | $ 393,144 | (65,429) | (267,928) |
Deferred income taxes, net | 215,038 | (27,301,266) | 27,646 |
Gain on sale of finance receivables | (52,178) | ||
Recognition of deferred gain from sale-leaseback transactions | (833,619) | (9,522) | |
Changes in operating assets and liabilities: | |||
Accounts receivable | (2,517,493) | (157,071) | (247,358) |
Finance receivables | (4,113,898) | 52,531 | 17,729 |
Inventory | (1,930,857) | 370,104 | 716,470 |
Prepaid expenses and other current assets | (304,229) | (190,783) | 503,937 |
Accounts payable | 918,761 | 412,664 | 1,164,804 |
Accrued expenses | 54,717 | 267,004 | $ (1,915,091) |
Income taxes payable | 33,065 | 21,021 | |
Net cash provided by (used in) operating activities | (1,697,742) | 7,085,400 | $ 6,038,952 |
INVESTING ACTIVITIES: | |||
Purchase of property and equipment | (60,309) | (111,121) | (107,351) |
Purchase of property for rental program | (1,641,993) | (10,883,473) | (9,092,394) |
Proceeds from sale of rental equipment under sale-leaseback transactions | 4,993,879 | 2,995,095 | |
Proceeds from sale of property and equipment | 61,914 | 82,047 | 18,908 |
Net cash provided by (used in) investing activities | 3,353,491 | (7,917,452) | (9,180,837) |
FINANCING ACTIVITIES: | |||
Net proceeds (payments) from the issuance (retirement) of common stock and exercise of common stock warrants | (61,987) | 2,272,936 | 311,177 |
Excess tax benefits from share-based compensation | 9,749 | 24,847 | |
Proceeds (payments) from line of credit | (1,000,000) | 2,000,000 | 3,000,000 |
Repayment of long-term debt | (358,582) | (374,411) | (614,937) |
Proceeds from long-term debt | 2,056,724 | ||
Net cash provided by financing activities | 645,904 | 3,923,372 | 2,696,240 |
Net increase (decrease) in cash and cash equivalents | 2,301,653 | 3,091,320 | (445,645) |
Cash and cash equivalents at beginning of year | 9,072,320 | 5,981,000 | 6,426,645 |
Cash at end of year | 11,373,973 | 9,072,320 | 5,981,000 |
Supplemental disclosures of cash flow information: | |||
Interest paid in cash | 305,566 | 259,820 | 118,934 |
Depreciation expense allocated to cost of services | 5,119,674 | 4,880,529 | 3,265,452 |
Reclass of rental program property to inventory, net | 674,280 | 33,266 | 28,337 |
Prepaid items financed with debt | 103,125 | 101,850 | 133,588 |
Prepaid interest from issuance of warrants for debt costs | 55,962 | ||
Equipment and software acquired under capital lease | 107,903 | 325,431 | 124,917 |
Disposal of property and equipment | 842,204 | 709,638 | $ 98,928 |
Disposal of property and equipment under sale-leaseback transactions | $ 3,873,275 | $ 1,918,920 |
BUSINESS
BUSINESS | 12 Months Ended |
Jun. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BUSINESS | 1. BUSINESS USA Technologies, Inc. (the “Company”, “We”, “USAT”, or “Our”) was incorporated in the Commonwealth of Pennsylvania in January 1992. We are a provider of technology-enabled solutions and value-added services that facilitate electronic payment transactions primarily within the unattended Point of Sale (“POS”) market. We are a leading provider in the small ticket, beverage and food vending industry and are expanding our solutions and services to other unattended market segments, such as amusement, commercial laundry, kiosk and others. Since our founding, we have designed and marketed systems and solutions that facilitate electronic payment options, as well as telemetry and machine-to-machine (“M2M”) services, which include the ability to remotely monitor, control, and report on the results of distributed assets containing our electronic payment solutions. Historically, these distributed assets have relied on cash for payment in the form of coins or bills, whereas, our systems allow them to accept cashless payments such as through the use of credit or debit cards or other emerging contactless forms, such as mobile payment. |
ACCOUNTING POLICIES
ACCOUNTING POLICIES | 12 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
ACCOUNTING POLICIES | 2. ACCOUNTING POLICIES CONSOLIDATION The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. USE OF ESTIMATES The preparation of the consolidated financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. CASH The Company maintains its cash in bank deposit accounts, which may exceed federally insured limits at times. ACCOUNTS RECEIVABLE Accounts receivable are reported at their outstanding unpaid principal balances reduced by an allowance for doubtful accounts. The Company estimates doubtful accounts for accounts receivable and finance receivables based on historical bad debts, factors related to specific customers’ ability to pay and current economic trends. The Company writes off accounts receivable against the allowance when management determines the balance is uncollectible and the Company ceases collection efforts. Management believes that the allowance recorded is adequate to provide for its estimated credit losses. FINANCE RECEIVABLES The Company offers extended payment terms to certain customers for equipment sales under its Quick Start Program. In accordance with the Financial Accounting Standards Board Accounting Standards Codification® (“ASC”) Topic 840, “Leases”, agreements under the Quick Start Program qualify for sales-type lease accounting. Accordingly, the future minimum lease payments are classified as finance receivables in the Company’s consolidated balance sheets. Finance receivables or Quick Start leases are generally for a sixty month term. Finance receivables are carried at their contractual amount and charged off against the allowance for credit losses when management determines that recovery is unlikely and the Company ceases collection efforts. The Company recognizes a portion of the note or lease payments as interest income in the accompanying consolidated financial statements based on the effective interest rate method. INVENTORY Inventory consists of finished goods and packaging materials. The Company’s inventory is stated at the lower of cost (average cost basis) or market. PROPERTY AND EQUIPMENT Property and equipment are recorded at cost. Property and equipment are depreciated on the straight-line basis over the estimated useful lives of the related assets. Leasehold improvements are amortized on the straight-line basis over the lesser of the estimated useful life of the asset or the respective lease term. INTANGIBLE ASSETS The company’s intangible assets include goodwill, trademarks and patents. Goodwill represents the excess of cost over fair value of the net assets purchased in acquisitions. The Company accounts for goodwill in accordance with ASC 350, “Intangibles – Goodwill and Other”. Under ASC 350, goodwill is not amortized to earnings, but instead is subject to periodic testing for impairment. Testing for impairment is to be done at least annually and at other times if events or circumstances arise that indicate that impairment may have occurred. The Company has selected April 1 as its annual test date. The Company has concluded there has been no impairment of goodwill during the fiscal years ended June 30, 2015, 2014 and 2013, respectively. The Company trademarks with an indefinite economic life are not being amortized. The trademarks, not subject to amortization, are related to the miser asset group and consist of the following trademarks: 1) VendingMiser, 2) CoolerMiser, 3) PlugMiser and 4) SnackMiser. The Company tests indefinite-life intangible assets for impairment using a two-step process. The first step screens for potential impairment, while the second step measures the amount of impairment. The Company uses a relief from royalty analysis to complete the first step in this process. Testing for impairment is to be done at least annually and at other times if events or circumstances arise that indicate that impairment may have occurred. The Company has selected April 1 as its annual test date for its indefinite-lived intangible assets. The Company has concluded there has been no impairment of trademarks during the fiscal years ended June 30, 2015, 2014 and 2013, respectively. Patents and trademarks, with an estimated economic life, are carried at cost less accumulated amortization, which is calculated on a straight-line basis over their estimated economic life. Intangible assets with an estimated economic life were fully amortized as of June 30, 2014. LONG LIVED ASSETS In accordance with ASC 360, “Impairment or Disposal of Long-Lived Assets”, the Company reviews its definite lived long-lived assets whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. If the carrying amount of an asset or group of assets exceeds its net realizable value, the asset will be written down to its fair value. In the period when the plan of sale criteria of ASC 360 are met, definite lived long-lived assets are reported as held for sale, depreciation and amortization cease, and the assets are reported at the lower of carrying value or fair value less costs to sell. The Company has concluded that the carrying amount of definite lived long-lived assets is recoverable as of June 30, 2015 and June 30, 2014. FAIR VALUE OF FINANCIAL INSTRUMENTS The Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2010-06, “Fair Value Measurements and Disclosures (“Topic 820”): Improving Disclosures about Fair Value Measurements.” ASU 2010-06 amends certain disclosure requirements of Subtopic 820-10. This ASU provides additional disclosures for transfers in and out of Levels 1 and 2 and for activity in Level 3. This ASU also clarifies certain other existing disclosure requirements including level of desegregation and disclosures around inputs and valuation techniques. The Company’s financial assets and liabilities are accounted for in accordance with ASC 820 “Fair Value Measurement.” Under ASC 820 the Company uses inputs from the three levels of the fair value hierarchy to measure its financial assets and liabilities. The three levels are as follows: Level 1- Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. Level 2- Inputs are other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (i.e., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs). Level 3- Inputs are unobservable and reflect the Company’s assumptions that market participants would use in pricing the asset or liability. The Company develops these inputs based on the best information available. The Company’s financial instruments, principally accounts receivable, short-term finance receivables, prepaid expenses and other assets, accounts payable and accrued expenses, are carried at cost which approximates fair value due to the short-term maturity of these instruments. The fair value of the Company’s obligations under its long-term debt credit agreements and the long-term portion of its finance receivables approximates their carrying value as such instruments are at market rates currently available to the Company. CONCENTRATION OF RISK Financial instruments that subject the Company to a concentration of credit risk consist principally of cash and accounts and finance receivables. The Company maintains cash with various financial institutions where accounts may exceed federally insured limits at times. Approximately 35% and 22% of the Company’s trade accounts and finance receivables at June 30, 2015 and 2014, respectively, were concentrated with one customer. Concentration of revenues with customers subject the Company to operating risks. Approximately 21%, 26% and 26% of the Company’s license and transaction processing revenues for the years ended June 30, 2015, 2014 and 2013, respectively, were concentrated with one customer. Additionally for the year ended June 30, 2013, approximately 11% of the license and transaction processing fees were with another customer. There was a 17% concentration of equipment sales revenue with one customer for the year ended June 30, 2015 with no concentrations for the years ended June 30, 2014 and 2013. The Company’s customers are principally located in the United States. REVENUE RECOGNITION Revenue from the sale or QuickStart lease of equipment is recognized on the terms of freight-on-board shipping point. Activation fee revenue, if applicable, is recognized when the Company’s cashless payment device is initially activated for use on the Company network. Transaction processing revenue is recognized upon the usage of the Company’s cashless payment and control network. License fees for access to the Company’s devices and network services are recognized on a monthly basis. In all cases, revenue is only recognized when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the price is fixed and determinable, and collection of the resulting receivable is reasonably assured. The Company estimates an allowance for product returns at the date of sale and license and transaction fee refunds on a monthly basis. ePort hardware is available to customers under the QuickStart program pursuant to which the customer would enter into a five-year non-cancelable lease with either the Company or a third-party leasing company for the devices. At the end of the lease period, the customer would have the option to purchase the device for a nominal fee. EQUIPMENT RENTAL The Company offers its customers a rental program for its ePort devices, the JumpStart program (“JumpStart”). JumpStart terms are typically 36 months and are cancellable with thirty to sixty days’ written notice. In accordance with ASC 840, “Leases”, the Company classifies the rental agreements as operating leases, with service fee revenue related to the leases included in license and transaction fees in the Consolidated Statements of Operations. Cost for the JumpStart revenues, which consists of depreciation expense on the JumpStart equipment, is included in cost of services in the Consolidated Statements of Operations. ePort equipment utilized by the JumpStart program is included in property and equipment, net on the Consolidated Balance Sheet. WARRANTY COSTS The Company generally warrants its products for one to three years. Warranty costs are estimated and recorded at the time of sale based on historical warranty experience, if available. These costs are reviewed and adjusted, if necessary, periodically throughout the year. SHIPPING AND HANDLING Shipping and handling fees billed to our customers in connection with sales are recorded as revenue. The costs incurred for shipping and handling of our product are recorded as cost of equipment. RESEARCH AND DEVELOPMENT EXPENSES Research and development expenses are expensed as incurred. Research and development expenses, which are included in selling, general and administrative expenses in the Consolidated Statements of Operations, were approximately $1,457,000, $1,018,000 and $901,000, for the years ended June 30, 2015, 2014, and 2013, respectively. Our research and development initiatives focus on adding features and functionality to our system solutions through the development and utilization of our processing and reporting network and new technology. ACCOUNTING FOR EQUITY AWARDS In accordance with ASC 718 the cost of employee services received in exchange for an award of equity instruments is based on the grant-date fair value of the award and allocated over the requisite service period of the award. INCOME TAXES The Company follows the provisions of FASB ASC 740, Accounting for Uncertainty in Income Taxes, Income taxes are computed using the asset and liability method of accounting. Under the asset and liability method, a deferred tax asset or liability is recognized for estimated future tax effects attributable to temporary differences and carryforwards. The measurement of deferred income tax assets is adjusted by a valuation allowance, if necessary, to recognize future tax benefits only to the extent, based on available evidence, it is more likely than not such benefits will be realized. The Company recognizes interest and penalties, if any, related to uncertain tax positions in selling, general and administrative expenses. No interest or penalties related to uncertain tax positions were accrued or incurred during the years ended June 30, 2015, 2014, and 2013. The Company files income tax returns in the United States federal jurisdiction and various state jurisdictions. The tax years ended June 30, 2012 through June 30, 2015 remain open to examination by taxing jurisdictions to which the Company is subject. As of June 30, 2015, the Company did not have any income tax examinations in process. EARNINGS (LOSS) PER COMMON SHARE Basic earnings (loss) per share are calculated by dividing net income (loss) applicable to common shares by the weighted average common shares outstanding for the period. Diluted earnings (loss) per share are calculated by dividing net income (loss) applicable to common shares by the weighted average common shares outstanding for the period plus the dilutive effects of common stock equivalents unless the effects of such common stock equivalents is anti-dilutive. For the years ended June 30, 2015 and 2014 no effect for common stock equivalents was considered in the calculation of diluted earnings (loss) per share because their effect was anti-dilutive. For the year ended June 30, 2013 the dilutive effect for 825,673 shares of common stock equivalents was considered in the calculation of diluted earnings (loss) per share. COMPREHENSIVE INCOME ASC 220, “Comprehensive Income”, prescribes the reporting required for comprehensive income and items of other comprehensive income. Entities having no items of other comprehensive income are not required to report on comprehensive income. The Company has no items of other comprehensive income for its years ended June 30, 2015, 2014 or 2013. RECENT ACCOUNTING PRONOUCEMENTS The Company is evaluating whether the effects of the following recent accounting pronouncements or any other recently issued, but not yet effective accounting standards, will have a material effect on the Company’s consolidated financial position, results of operations or cash flows. In May 2014, the Financial Accounting Standards Board issued ASU 2014-09 Revenue from Contracts with Customers (Topic 606). This pronouncement will be effective for the Company beginning with the year ending June 30, 2019. In June 2014, the Financial Accounting Standards Board issued ASU 2014-12 Compensation- Stock Compensation (Topic 718); Accounting for share-based payments when the terms of the award provide that a performance target could be achieved after the requisite service period. This pronouncement will be effective for the Company beginning with the year ending June 30, 2017. In August 2014, the Financial Accounting Standards Board issued ASU 2014-15 Presentation of Financial Statements- Going Concern (Subtopic 205-40): Disclosure of uncertainties about an entity’s ability to continue as a going concern. This pronouncement will be effective for the Company beginning with the year ending June 30, 2018. In April 2015, the Financial Accounting Standards Board issued ASU 2015-03 Interest- Imputation of Interest (Subtopic 835-30): Simplifying the presentation of debt issuance costs. This pronouncement will be effective for the Company beginning with the year ending June 30, 2017. In July 2015, the Financial Accounting Standards Board issued ASU 2015-11 Inventory (Topic 330): Simplifying the measurement of inventory. This pronouncement will be effective for the Company beginning with the year ending June 30, 2018. RECLASSIFICATION Certain amounts in the prior period financial statements have been reclassified to conform to the current period presentation. |
FINANCE RECEIVABLES
FINANCE RECEIVABLES | 12 Months Ended |
Jun. 30, 2015 | |
Receivables [Abstract] | |
FINANCE RECEIVABLES | 3. FINANCE RECEIVABLES Finance Receivables consist of the following: June 30, June 30, 2015 2014 Total finance receivables $ 4,638,663 $ 472,587 Less current portion 941,150 119,793 Non-current portion of finance receivables $ 3,697,513 $ 352,794 As of June 30, 2015 and 2014, there was no allowance for credit losses of finance receivables. Credit quality indicators consist of the following: Credit risk profile based on payment activity: June 30, June 30, Performing $ 4,618,458 $ 472,587 Nonperforming 20,205 - Total $ 4,638,663 $ 472,587 Age Analysis of Past Due Finance Receivables As of June 30, 31 – 60 61 – 90 Greater than Total Days Past Due Days Past Due 90 Days Past Due Total Past Due Current Finance Receivables QuickStart Leases - 2015 $ - $ 15,574 $ 4,630 $ 20,205 $ 4,618,458 $ 4,638,663 QuickStart Leases - 2014 $ - $ 909 $ 378 $ 1,287 $ 471,300 $ 472,587 |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended |
Jun. 30, 2015 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | 4. PROPERTY AND EQUIPMENT Property and equipment, at cost, consist of the following: Useful June 30, 2015 Lives Cost Accumulated Net Computer equipment and purchased software 3-7 years $ 4,669,485 $ (4,016,635 ) $ 652,850 Property and equipment used for rental program 5 years 26,469,057 (14,475,816 ) $ 11,993,241 Furniture and equipment 3-7 years 723,047 (571,933 ) $ 151,114 Leasehold improvements Lesser of life or lease term 575,343 (503,740 ) $ 71,603 $ 32,436,932 $ (19,568,124 ) $ 12,868,808 Useful June 30, 2014 Lives Cost Accumulated Net Computer equipment and purchased software 3-7 years $ 4,581,001 $ (3,612,551 ) $ 968,450 Property and equipment used for rental program 5 years 30,348,918 (10,524,701 ) $ 19,824,217 Furniture and equipment 3-7 years 681,717 (498,995 ) $ 182,722 Leasehold improvements Lesser of life or lease term 575,343 (412,152 ) $ 163,191 $ 36,186,979 $ (15,048,399 ) $ 21,138,580 2015 2014 2013 Depreciation expense $ 5,694,452 $ 5,459,064 $ 3,837,174 Assets under capital leases totaled approximately $2,139,000 and $2,031,000 as of June 30, 2015 and 2014, respectively. Capital lease amortization of approximately $349,000, $305,000 and $265,000, is included in depreciation expense for the years ended June 30, 2015, 2014, and 2013, respectively. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 12 Months Ended |
Jun. 30, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS | 5. INTANGIBLE ASSETS Amortization expense relating to all acquired intangible assets was approximately $0, $22,000 and $742,000 during each of the years ended June 30, 2015, 2014, and 2013, respectively. Intangible asset balances consisted of the following: Beginning Year ended June 30, 2015 Ending Balance Additions/ Balance Amortization July 1, 2014 Adjustments Amortization June 30, 2015 Period Intangible assets: Goodwill $ 7,663,208 $ - $ - $ 7,663,208 Indefinite Trademarks - Indefinite 432,100 - - 432,100 Indefinite Trademarks - Amortizable - - - - 10 years Patents - - - - 10 years Total $ 8,095,308 $ - $ - $ 8,095,308 Beginning Year ended June 30, 2014 Ending Balance Additions/ Balance Amortization July 1, 2013 Adjustments Amortization June 30, 2014 Period Intangible assets: Goodwill $ 7,663,208 $ - $ - $ 7,663,208 Indefinite Trademarks - Indefinite 432,100 - - 432,100 Indefinite Trademarks - Amortizable 21,953 - (21,953 ) - 10 years Patents - - - - 10 years Total $ 8,117,261 $ - $ (21,953 ) $ 8,095,308 |
ACCRUED EXPENSES
ACCRUED EXPENSES | 12 Months Ended |
Jun. 30, 2015 | |
Accrued Liabilities [Abstract] | |
ACCRUED EXPENSES | 6. ACCRUED EXPENSES Accrued expenses consist of the following: June 30, June 30, 2015 2014 Accrued compensation and related sales commissions $ 672,628 $ 545,110 Accrued professional fees 301,150 214,615 Accrued taxes and filing fees 505,300 640,958 Advanced customer billings 390,023 370,040 Accrued rent 74,601 155,712 Accrued other 212,988 175,538 2,156,690 2,101,973 Less current portion (2,107,530 ) (1,915,799 ) $ 49,160 $ 186,174 |
LINE OF CREDIT
LINE OF CREDIT | 12 Months Ended |
Jun. 30, 2015 | |
Line Of Credit Facility [Abstract] | |
LINE OF CREDIT | 7. LINE OF CREDIT On July 10, 2012, the Company entered into a Loan and Security Agreement and other ancillary documents (the “Loan Agreement”) with a commercial bank (the “Bank”), which, as amended, provides for a secured line of credit of up to $7 million, secured by substantially all of the Company’s assets, until August 17, 2017. The outstanding balance of the amounts advanced under the line of credit will bear interest at 2% above the prime rate as published in The Wall Street Journal or 5% whichever is higher. The Loan Agreement contains customary affirmative and negative covenants, including achieving a minimum Adjusted EBITDA and minimum liquidity, and customary events of default. During the period of the Line of Credit, the Company has obtained waivers from the Bank for failure to satisfy certain covenants. As of June 30, 2015, the Company was in violation a covenant of the Loan Agreement which was subsequently waived by the Bank on July 31, 2015. In connection with the Bank extending the Line of Credit, in January 2013, the Company issued to the Bank warrants to purchase up to 45,000 shares of common stock of the Company at any time prior to December 31, 2017 at an exercise price of $2.10 per share. The fair value of the warrants of $55,962 was amortized as interest expense in the years ended June 30, 2014 and 2013 of $2,095 and $53,867, respectively. As of or Twelve Months Ended June 30, 2015 2014 Balance at period-end $ 4,000,000 $ 5,000,000 Maximum amount outstanding at any month end $ 5,000,000 $ 5,000,000 Average balance outstanding during the period $ 4,077,000 $ 4,154,000 Weighted-average interest rate: As of the period-end 5.25 % 5.25 % Paid during the period 5.25 % 5.25 % Interest expense on the line of credit was approximately $211,000, $221,000 and $84,000 during each of the years ended June 30, 2015, 2014 and 2013, respectively. |
LONG-TERM DEBT
LONG-TERM DEBT | 12 Months Ended |
Jun. 30, 2015 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | 8. LONG-TERM DEBT CAPITAL LEASES The company periodically enters into capital lease obligations to finance certain office and network equipment for use in its daily operations. During the 12 month periods ended June 30, 2015, 2014, and 2013, the company entered into capital lease obligations of $108,000, $325,000 and $108,000, respectively. The interest rates on these obligations range from 4.89% to 13.88%. The value of the acquired equipment is included in property and equipment and depreciated accordingly. The balances of the capital lease obligations as of June 30, 2015 and 2014 and the related future obligations are shown in the table below. OTHER LOAN AGREEMENTS The company periodically enters into other loan agreements to finance the purchase of various assets as needed, including computer equipment, insurance premiums, network equipment and software for use in its daily operations. During the twelve-month periods ended June 30, 2015, 2014 and 2013, the company entered into capital lease obligations of $108,000, $325,000, and $108,000, respectively. The interest rates on these obligations range from approximately 4.9% to 13.9%. The value of these financed assets acquired is included in property and equipment or other assets and depreciated accordingly. The balances of the other loan agreements as of June 30, 2015 and 2014 and the related future obligations is shown in the table below. ASSIGNMENT OF QUICKSTART LEASES In February 2015 and May 2015, the Company assigned its interest in certain finance receivables (various 60 month QuickStart leases) to a third party finance company in exchange for cash and the assumption of financing obligations in the aggregate of $1,752,717 and $304,008, respectively. The assignment transaction contains recourse provisions for the Company which requires the proceeds from the assignment to be treated as long-term debt. The financing obligations range in rate from 9.41% to 9.45%. The balance of the financing obligations is shown in the table below. June 30, June 30, 2015 2014 Capital lease obligations $ 337,597 $ 414,525 Other loan agreements - 8,251 Lease financing obligations 1,994,349 - 2,331,946 422,776 Less current portion 477,522 172,911 $ 1,854,424 $ 249,865 The maturities of long-term debt for each of the fiscal years following June 30, 2015 are as follows: 2016 $ 477,522 2017 502,749 2018 488,929 2019 486,928 2020 371,237 Thereafter 4,581 $ 2,331,946 |
FAIR VALUE OF FINANCIAL INSTRUM
FAIR VALUE OF FINANCIAL INSTRUMENTS | 12 Months Ended |
Jun. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | 9. FAIR VALUE OF FINANCIAL INSTRUMENTS In accordance with the fair value hierarchy described in Note 2, the following table shows the fair value of the Company’s financial instruments that are required to be measured at fair value as of June 30, 2015 and 2014: June 30, 2015 Level 1 Level 2 Level 3 Total Common stock warrant liability, warrants exercisable at $2.6058 from September 18, 2011 through September 18, 2016 $ - $ - $ 978,353 $ 978,353 June 30, 2014 Level 1 Level 2 Level 3 Total Common stock warrant liability, warrants exercisable at $2.6058 from September 18, 2011 through September 18, 2016 $ - $ - $ 585,209 $ 585,209 The Level 3 financial instrument consists of common stock warrants issued by the Company in March 2011 include features requiring liability treatment of the warrants. The fair value of warrants issued in March 2011 (see Note 13) to purchase 3.9 million shares of the Company’s common stock is based on valuations performed by an independent third party valuation firm. The fair value was determined using proprietary valuation models using the quality of the underlying securities of the warrants, restrictions on the warrants and security underlying the warrants, time restrictions and precedent sale transactions completed in the secondary market or in other private transactions. There were no transfers of assets or liabilities between level 1, level 2, or level 3 during the years ended June 30, 2015 and 2014. The following table summarizes the changes in fair value of the Company’s Level 3 financial instruments for the years ended: June 30, 2015 2014 Beginning balance $ (585,209 ) $ (650,638 ) Gain (loss) due to change in fair value of warrant liabilities, net (393,144 ) 65,429 Ending balance $ (978,353 ) $ (585,209 ) |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Jun. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | 10. INCOME TAXES The Company has significant deferred tax assets, a substantial amount of which result from operating loss carryforwards. The Company routinely evaluates its ability to realize the benefits of these assets to determine whether it is more likely than not that such benefit will be realized. In periods prior to the year ended June 30, 2014, the Company’s evaluation of its ability to realize the benefit from its deferred tax assets resulted in a full valuation allowance against such assets. Based upon earnings performance that the Company had achieved along with the belief that such performance will continue into future years, the Company determined during the year ended June 30, 2014 that it was more likely than not that a substantial portion of its deferred tax assets would be realized and reduced its valuation allowances recorded in prior years by approximately $27 million, which includes $40,245 of deferred tax liabilities recorded as of June 30, 2013 reversing in the current year. In addition to considering recent periods’ performance, the evaluation of the amount of deferred tax assets expected to be realized involves forecasting the amount of taxable income that will be generated in future years. The Company has forecasted future results using estimates that management believes to be conservative. The number of connections added in a service year are a key metric, which in the Company’s recurring revenue service model become an important ingredient in driving future growth and earnings. The forecasts the Company used assumes that significantly fewer net connections would be added to its service year than what it has historically achieved during each of its previous five fiscal years. With respect to its forecasts, the Company also has taken into account several industry analysts who have projected that demand for technology and services similar to the Company’s will continue to grow in the markets the Company serves. Using these forecasts, the Company estimated that it was more likely than not that approximately $64 million of its operating loss carryforwards would be utilized to offset corresponding future years’ taxable income. If in future periods the Company demonstrates its ability to grow taxable income in excess of the forecasts described above, it will re-evaluate the need to keep some, or all, of the remaining valuation allowances of approximately $23 million on its deferred tax assets. The benefit (provision) for income taxes for the years ended June 30, 2015, 2014 and 2013 is comprised of the following: 2015 2014 2013 Current: Federal $ (58,028 ) $ (21,021 ) $ - State (6,325 ) - - (64,353 ) (21,021 ) - Deferred: Federal 365,143 20,970,149 (20,842 ) State (589,931 ) 6,306,270 (6,804 ) (224,788 ) 27,276,419 (27,646 ) $ (289,141 ) $ 27,255,398 $ (27,646 ) The provision for income taxes for the year ended June 30, 2015 includes $395,605 for the state and federal income tax effects of a decrease in the applicable state tax rate used to tax effect deferred tax assets caused by a state income tax law change. The provision for income taxes for the years ended June 30, 2013 was recorded for the future potential income tax effects for basis differences between financial reporting and income tax purposes for indefinite life intangible assets and goodwill that are being amortized for income tax purposes but not for financial reporting. Because there was a full valuation allowance reflected against deferred tax assets as of June 30, 2013, the potential future income tax effects associated with such indefinite life assets were not subject to offset deferred tax assets with finite lives. A reconciliation of the benefit (provision) for income taxes for the years ended June 30, 2015, 2014 and 2013 to the indicated benefit (provision) based on income (loss) before benefit (provision) for income taxes at the federal statutory rate of 34% is as follows: 2015 2014 2013 Indicated benefit (provision) at federal statutory rate of 34% $ 272,116 $ (93,586 ) $ (299,801 ) Effects of permanent differences (215,271 ) (8,168 ) 71,379 State income taxes, net of federal benefit (410,410 ) (17,989 ) (4,490 ) Income tax credits 40,000 - - Changes related to prior years 187,373 - - Change in valuation allowances (162,949 ) 27,375,141 205,266 $ (289,141 ) $ 27,255,398 $ (27,646 ) At June 30, 2015 the Company had federal operating loss carryforwards of approximately $163 million to offset future taxable income expiring through approximately 2035. The timing and extent to which the Company can utilize operating loss carryforwards in any year may be limited by provisions of the Internal Revenue Code regarding changes in ownership of corporations (i.e. IRS Code Section 382). The changes in ownership limitations under IRS Code Section 382 have had the effect of limiting the maximum amount of operating loss carryforwards as of June 30, 2015 available for use to offset future years’ taxable income to approximately $125 million. Those operating loss carryforwards start to expire June 30, 2022. The net deferred tax assets arose primarily from net operating loss carryforwards, as well as the use of different accounting methods for financial statement and income tax reporting purposes as follows: June 30, 2015 2014 Deferred tax assets: Net operating loss carryforwards $ 46,919,363 $ 47,776,042 Asset reserves 791,915 391,155 Deferred research and development costs 1,009,303 710,640 Intangibles 605,836 907,274 Deferred gain on assets under sale-leaseback transaction 632,317 460,902 Stock-based compensation 223,883 250,426 Other 436,510 348,885 50,619,127 50,845,324 Deferred tax liabilities: Fixed assets (491,990 ) (683,159 ) Intangibles and goodwill (84,520 ) (67,459 ) Deferred tax assets, net 50,042,617 50,094,706 Valuation allowance (22,996,634 ) (22,833,685 ) Deferred tax assets (liabilties), net of allowance 27,045,983 27,261,021 Less current portion 1,257,796 907,691 Deferred tax assets (liabilties), non-current $ 25,788,187 $ 26,353,330 |
PREFERRED STOCK
PREFERRED STOCK | 12 Months Ended |
Jun. 30, 2015 | |
Preferred Stock [Abstract] | |
PREFERRED STOCK | 11. PREFERRED STOCK The authorized Preferred Stock may be issued from time to time in one or more series, each series with such rights, preferences or restrictions as determined by the Board of Directors. As of June 30, 2015 each share of Series A Preferred Stock is convertible into 0.194 of a share of Common Stock and each share of Series A Preferred Stock is entitled to 0.194 of a vote on all matters on which the holders of Common Stock are entitled to vote . Series A Preferred Stock provides for an annual cumulative dividend of $1.50 per share, payable when, as and if declared by the Board of Directors, to the shareholders of record in equal parts on February 1 and August 1 of each year. Any and all accumulated and unpaid cash dividends on the Series A Preferred Stock must be declared and paid prior to the declaration and payment of any dividends on the Common Stock. The Series A Preferred Stock may be called for redemption at the option of the Board of Directors for a price of $11.00 per share plus payment of all accrued and unpaid dividends. No such redemption has occurred as of June 30, 2015. In the event of any liquidation as defined in the Company’s Articles of Incorporation, the holders of shares of Series A Preferred Stock issued shall be entitled to receive $10.00 for each outstanding share plus all cumulative unpaid dividends. If funds are insufficient for this distribution, the assets available will be distributed ratably among the preferred shareholders. The Series A Preferred Stock liquidation preference as of June 30, 2015 and 2014 is as follows: 2015 2014 Shares outstanding at $10.00 per share $ 4,429,680 $ 4,429,680 Cumulative unpaid dividends 12,925,228 12,260,776 $ 17,354,908 $ 16,690,456 Cumulative unpaid dividends are convertible into common shares at $1,000 per common share at the option of the shareholder. During the years ended June 30, 2015, 2014 and 2013, no shares of Preferred Stock nor cumulative preferred dividends were converted into shares of common stock. |
STOCK BASED COMPENSATION PLANS
STOCK BASED COMPENSATION PLANS | 12 Months Ended |
Jun. 30, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK BASED COMPENSATION PLANS | 12. STOCK BASED COMPENSATION PLANS The Company has three active stock based compensation plans at June 30, 2015 as shown in the table below: Date Approved Name of Plan Type of Plan Authorized Shares June 2013 2013 Stock Incentive Plan Stock 500,000 June 2014 2014 Stock Option Incentive Plan Stock Options 750,000 June 2015 2015 Equity Incentive Plan Stock + Stock Options 1,250,000 2,500,000 As of June 30, 2015, the Company had reserved shares of Common Stock for future issuance for the following: Exercise of Common Stock Warrants 4,309,000 Conversions of Preferred Stock and cumulative Preferred Stock dividends 98,861 Issuance under 2013 Stock Incentive Plan 321,111 Issuance under 2014 Stock Option Incentive Plan 750,000 Issuance under 2015 Equity Incentive Plan 1,250,000 Issuance to former Chief Executive Officer upon a prescribed transaction 140,000 Total shares reserved for future issuance 6,868,972 STOCK OPTIONS The Company estimates the grant date fair value of the stock options it grants using a Black-Scholes valuation model. The Company’s assumption for expected volatility is based on its historical volatility data related to market trading of its own common stock. The Company bases its assumptions for expected life of the new stock option grants on the life of the option granted, and if relevant, its analysis of the historical exercise patterns of its stock options. The dividend yield assumption is based on dividends expected to be paid over the expected life of the stock option. The risk-free interest rate assumption is determined by using the U.S. Treasury rates of the same period as the expected option term of each stock option. There were no options granted during the fiscal year ended June 30, 2013. Year ended Year ended June 30, 2015 June 30, 2014 Expected volatility 78-79% 79% Expected life 7 years 7 years Expected dividends 0.00% 0.00% Risk-free interest rate 1.59-2.04 2.22% The 2014 Stock Option Incentive Plan was approved in June 2014 therefore there was no stock based compensation expense related to stock options for the years ended June 30, 2013 and June 30, 2014. Stock based compensation related to stock options for the year ended June 30, 2015 was $370,435. Unrecognized compensation related to stock option grants as of June 30, 2015 was $297,202. The following table provides information about options outstanding: For the Twelve Months Ended June 30, 2015 2014 2013 Shares Weighted Weighted Shares Weighted Weighted Shares Weighted Weighted Options outstanding, beginning of period 120,000 $ 2.05 $ 1.49 - $ - $ - 45,333 $ 7.53 $ 5.34 Granted 438,888 $ 1.82 $ 1.30 120,000 $ 2.05 $ 1.49 - $ - $ - Forfeited (20,000 ) $ 2.05 $ 1.49 - $ - $ - - $ - $ - Expired - $ - $ - - $ - $ - (45,333 ) $ 7.53 $ 5.34 Exercised - $ - $ - - $ - $ - - $ - $ - Options outstanding, end of period 538,888 $ 1.86 $ 1.33 120,000 $ 2.05 $ 1.49 - $ - $ - The following table provides information related to options as of June 30, 2015: Options Outstanding Options Exercisable Range of Exercise Prices Options Remaining Shares Remaining Weighted $1.62 to $1.68 75,000 6.51 - N/A N/A $1.78 328,888 6.16 - N/A N/A $2.05 100,000 5.97 33,335 5.97 $ 2.05 $2.09 10,000 6.58 - N/A N/A $2.75 25,000 6.77 - N/A N/A 538,888 6.21 33,335 5.97 $ 2.05 The following table provides information about unvested options: For the Twelve Months Ended June 30, 2015 2014 2013 Shares Weighted Shares Weighted Shares Weighted Unvested options, beginning of period 120,000 $ 1.49 - - - - Granted 438,888 $ 1.30 120,000 $ 1.49 - - Vested (33,335 ) $ 1.49 - - - - Forfeited (20,000 ) $ 1.49 - - - - Unvested options, end of period 505,553 $ 1.32 120,000 $ 1.49 - $ - The following table provides information about options outstanding and exercisable options: As of June 30, 2015 2014 2013 Options Exercisable Options Exercisable Options Exercisable Number 538,888 33,335 120,000 - - - Weighted average exercise price $ 1.86 $ 2.05 $ 2.05 $ - $ - $ - Aggregate intrinsic value $ 451,177 $ 21,668 $ 7,200 $ - $ - $ - Weighted average contractual term 6.21 5.97 6.97 - - - Share price as of June 30 $ 2.70 $ 2.70 $ 2.11 $ 2.11 $ 1.74 $ 1.74 STOCK GRANTS A summary of the status of the Company’s nonvested common shares as of June 30, 2015, 2014, and 2013, and changes during the years then ended is presented below: Weighted-Average Grant-Date Shares Fair Value Nonvested Shares Nonvested at June 30, 2012 172,003 $ 1.82 Granted 156,429 1.45 Vested (204,587 ) 1.72 Forfeited, Employee shares not earned (26,699 ) 1.52 Nonvested at June 30, 2013 97,146 $ 1.52 Granted 10,000 2.17 Vested (55,001 ) 1.62 Forfeited, Director changes (3,334 ) 0.94 Forfeited, Employee shares not earned (5,000 ) 1.52 Nonvested at June 30, 2014 43,811 $ 1.59 Granted 155,927 2.00 Vested (181,134 ) 1.89 Nonvested at June 30, 2015 18,604 $ 1.88 |
WARRANTS
WARRANTS | 12 Months Ended |
Jun. 30, 2015 | |
Warrants [Abstract] | |
WARRANTS | 13. WARRANTS All warrants outstanding as of June 30, 2015 were exercisable. The following table shows exercise prices and expiration dates for warrants outstanding as of June 30, 2015: Exercise Warrants Price Expiration Outstanding Per Share Date 4,264,000 $ 2.61 September 18, 2016 45,000 $ 2.10 December 31, 2017 4,309,000 Warrant activity for the years ended June 30, 2015, 2014, and 2013 was as follows: Warrants Outstanding at June 30, 2012 8,045,619 Issued 45,000 Exercised (399,597 ) Expired (329,314 ) Outstanding at June 30, 2013 7,361,708 Issued - Exercised (2,090,226 ) Expired (962,482 ) Outstanding at June 30, 2014 4,309,000 Issued - Exercised - Expired - Outstanding at June 30, 2015 4,309,000 On May 12, 2010, in conjunction with a public offering, the Company issued warrants to purchase 2,753,454 shares of Common Stock, exercisable at $1.13 per share at any time prior to December 31, 2013. During the years ended June 30, 2014 and 2013, 2,090,226 and 369,287 of these warrants were exercised at $1.13 per share for cash proceeds of $2,361,956 and $417,294, respectively. Warrants to purchase 58,527 shares of Common Stock expired unexercised on December 31, 2013. In conjunction with this public offering, the Company also issued to the placement agent warrants to purchase 165,207 and 15,717 shares of Common Stock, exercisable at $1.13 per share at any time prior to May 12, and July 7, 2013, respectively. During the year ended June 30, 2013 the placement agent elected cashless exercises of 36,186 warrants resulting in the issuance of 17,094 shares of Common Stock and exercised warrants to purchase 13,216 shares of Common Stock at $1.13 per share for cash proceeds of $14,934. Warrants to purchase 1,258 shares of Common Stock expired unexercised in May 2013. On March 17, 2011, in conjunction with a private placement offering the Company issued warrants to purchase up to 3,900,000 shares of Common Stock, exercisable at $2.6058 per share. Additionally, the Company issued the placement agent in this offering warrants to purchase 364,000 shares of common stock at $2.6058 per share. The 4,264,000 warrants are exercisable from September 18, 2011 through September 18, 2016. As of June 30, 2015, no warrants have been exercised under this offering. The 3,900,000 warrants issued under this private placement offering contain a provision that if a Fundamental Transaction occurs, notably a change in control, the warrant holder may require the Company to pay the Black-Scholes calculated value of the then unexercised warrant to the warrant holder in cash. As such the Company has recorded a liability of $978,353 and $585,209 at June 30, 2015 and 2014, respectively, for the estimated fair value of the warrants in its Consolidated Balance Sheet (see Note 9). Period to period changes in the fair value of these warrants are reflected through income. In conjunction with the Loan and Security agreement (Note 7) and as a condition of the Bank entering into the First Amendment, the Company issued to the Bank warrants to purchase up to 45,000 shares of Common Stock of the Company. The warrants are exercisable at any time prior to December 31, 2017 at an exercise price of $2.10 per share. Upon the issuance of the warrants, the fair value of the warrants was $55,962 using a Black Scholes model, which was recorded as prepaid interest and included in other assets on the Consolidated Balance Sheet, and is being amortized as non-cash interest expense over the remaining term of the Line of Credit as amended in January 2013. Non-cash interest of $0, $2,095 and $53,867 has been recognized for the years ended June 30, 2015, 2014 and 2013, respectively. As of June 30, 2015 none of these warrants has been exercised. |
RETIREMENT PLAN
RETIREMENT PLAN | 12 Months Ended |
Jun. 30, 2015 | |
Compensation and Retirement Disclosure [Abstract] | |
RETIREMENT PLAN | 14. RETIREMENT PLAN The Company’s 401(k) Plan (the “Retirement Plan”) allows employees who have completed six months of service to make voluntary contributions up to a maximum of 100% of their annual compensation, as defined in the Retirement Plan. The Company may, in its discretion, make a matching contribution, a profit sharing contribution, a qualified non-elective contribution, and/or a safe harbor 401(k) contribution to the Retirement Plan. The Company must make an annual election, at the beginning of the plan year, as to whether it will make a safe harbor contribution to the plan. In fiscal years 2015, 2014 and 2013, the Company elected and made a safe harbor matching contributions of 100% of the participant’s first 3% and 50% of the next 2% of compensation deferred into the Retirement Plan. The Company’s safe harbor contributions for the years ended June 30, 2015, 2014 and 2013 approximated $192,000, $168,000 and $176,000, respectively. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Jun. 30, 2015 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | 15. RELATED PARTY TRANSACTIONS There were no related party transactions during the years ended June 30, 2015, 2014 and 2013. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Jun. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 16. COMMITMENTS AND CONTINGENCIES SALE AND LEASEBACK TRANSACTIONS In June 2014, the Company and a third party finance company, entered into six Sale Leaseback Agreements (the “Sale Leaseback Agreements” or a “Sale Leaseback Agreement”) pursuant to which a third-party finance company purchased ePort equipment owned by the Company and used by the Company in its JumpStart Program. As of June 30, 2014, a third-party finance company completed the purchase from the Company, the ePort equipment under the first two of the Sale Leaseback Agreements. In the quarter ended September 2014, a third-party finance company completed the purchase from the Company of the ePort equipment described in the last four of the Sale Leaseback Agreements. Upon the completion of the sale under these agreements, the Company computed a gain on the sale of its ePort equipment, which is deferred and will be amortized in proportion to the related gross rental charged to expense over the lease terms in accordance with the FASB topic ASC 840-40, “Sale Leaseback Transactions”. The computed gain on the sale will be recognized ratably over the 36-month term and charged as a reduction to the Company’s JumpStart rent expense included in costs of services in the Company’s Consolidated Statement of Operations. The Company is accounting for the Sale Leaseback as an operating lease and is obligated to pay to Varilease a base monthly rental for this equipment during the 36-month lease term. The future lease payment obligations under these agreements are included in the table at the bottom of this note. Upon the completion of the sales, the Company computed gains on the sale of its ePort equipment as follows: Year ended Year ended Rental equipment sold, cost $ 3,873,275 $ 1,918,920 Rental equipment sold, accumulated depreciation upon sale (331,069 ) (76,032 ) Rental equipment sold, net book value 3,542,206 1,842,888 Proceeds from sale 4,993,879 2,995,095 Gain on sale of rental equipment $ 1,451,673 $ 1,152,207 In accordance with the FASB topic ASC 840-40, “Sale Leaseback Transactions”, any gain shall be deferred and shall be amortized in proportion to the related gross rental charged to expense over the lease term. The computed gain on the sale will be recognized ratably over the 36 month term and charged as a reduction to the Company’s JumpStart rent expense included in costs of services in the Company’s Consolidated Statement of Operations. For the years ended June 30, 2015 and 2014 the Company recognized gains as follows: Year ended Year ended Beginning balance $ 1,142,685 $ - Gain on sale of rental equipment 1,451,673 1,152,207 Recognition of deferred gain (833,619 ) (9,522 ) Ending balance 1,760,739 1,142,685 Less current portion 860,391 380,895 Non-current portion of deferred gain $ 900,348 $ 761,790 OTHER LEASES Other lease commitments include leases for its operations from various facilities. The Company leases space located in Malvern, Pennsylvania for its principal executive office and used for general administrative functions, sales activities, product development, and customer support. In November 2010, the Company entered into an amended lease of its principal executive office in Malvern, Pennsylvania, which extended the lease term from December 31, 2010 to April 2016. The amendment includes rental payments of approximately $29,000 to $32,000 as well as a four month period of no rent payments and leasehold improvements of approximately $195,000. The straight-lined rent expense for this office is approximately $25,000 per month for the duration of the lease. The Company leases space in Malvern, Pennsylvania for its product warehousing and shipping support. In November 2012, the Company entered into a lease as of January 1, 2013 through February 29, 2016. The lease includes monthly rental payments from $4,406 to $4,678 as well as a two month period of no rent payments. Beginning in January 2013 the straight-lined rent expense for this operations site is approximately $4,300 per month for the duration of the lease period. Rent expense under operating leases was approximately $354,000, $372,000 and $432,000 during the years ended June 30, 2015, 2014, and 2013, respectively. SUMMARY OF LEASE OBLIGATIONS Future minimum lease payments for fiscal years subsequent to June 30, 2015 under non-cancellable operating leases and capital leases are as follows: Operating Leases Other Operating Total Operating Capital from Sale Leaseback Leases Leases Leases 2016 $ 2,641,155 $ 361,927 $ 3,003,082 $ 157,304 2017 2,641,155 810 2,641,965 131,585 2018 137,731 - 137,731 70,416 2019 - - - 23,361 Total minimum lease payments $ 5,420,041 $ 362,737 $ 5,782,778 $ 382,666 Less amount representing interest 45,069 Present value of net minimum lease payments 337,597 Less current obligations under capital leases 131,583 Obligations under capital leases, less current portion $ 206,014 LITIGATION From time to time, the Company is involved in various legal proceedings arising during the normal course of business which, in the opinion of the management of the Company, will not have a material adverse effect on the Company’s financial position and results of operations or cash flows. On December 30, 2014, the Company settled a legal action brought in connection with a customer billing dispute. Under the settlement, the Company agreed to pay approximately $690,000. Approximately $280,000 of this amount was recorded in fiscal 2014 and $410,000 of this amount was recorded in fiscal 2015 and was reflected in Cost of Services in the Consolidated Statements of Operations. During 2015, the Company became involved in a legal proceeding with a former non- vending customer and entities affiliated with the former customer. The Company is seeking to recoup approximately $680,000 relating to certain credit card chargebacks due under the customer agreement, while the former customer is seeking to recover damages alleged to have been incurred as a result of the breach by the Company of the agreement. The Company does not believe any of the claims asserted against it have merit and intends to vigorously defend this matter. Additionally, the Company intends to pursue its claims in order to recoup the chargebacks. |
VALUATION AND QUALIFYING ACCOUN
VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Jun. 30, 2015 | |
Valuation and Qualifying Accounts [Abstract] | |
VALUATION AND QUALIFYING ACCOUNTS | SCHEDULE II USA TECHNOLOGIES, INC. VALUATION AND QUALIFYING ACCOUNTS YEARS ENDED JUNE 30, 2015, 2014, AND 2013 Deductions uncollectible Balance at Additions receivables Balance beginning charged to written off, net at end ACCOUNTS RECEIVABLE of period earnings of recoveries of period June 30, 2015 $ 63,000 $ 594,000 $ 163,000 $ 494,000 June 30, 2014 $ 18,000 $ 94,000 $ 49,000 $ 63,000 June 30, 2013 $ 25,000 $ 69,000 $ 76,000 $ 18,000 Balance at Additions Deductions, Balance beginning charged to Shrinkage and at end INVENTORY of period earnings obsolescence of period June 30, 2015 $ 765,000 $ 551,000 $ 372,000 $ 944,000 June 30, 2014 $ 727,000 $ 164,000 $ 126,000 $ 765,000 June 30, 2013 $ 712,000 $ 135,000 $ 120,000 $ 727,000 |
ACCOUNTING POLICIES (Policies)
ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Jun. 30, 2015 | |
Business Description And Accounting Policies [Abstract] | |
CONSOLIDATION | CONSOLIDATION The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. |
USE OF ESTIMATES | USE OF ESTIMATES The preparation of the consolidated financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. |
CASH | CASH The Company maintains its cash in bank deposit accounts, which may exceed federally insured limits at times. |
ACCOUNTS RECEIVABLE | ACCOUNTS RECEIVABLE Accounts receivable are reported at their outstanding unpaid principal balances reduced by an allowance for doubtful accounts. The Company estimates doubtful accounts for accounts receivable and finance receivables based on historical bad debts, factors related to specific customers’ ability to pay and current economic trends. The Company writes off accounts receivable against the allowance when management determines the balance is uncollectible and the Company ceases collection efforts. Management believes that the allowance recorded is adequate to provide for its estimated credit losses. |
FINANCE RECEIVABLES | FINANCE RECEIVABLES The Company offers extended payment terms to certain customers for equipment sales under its Quick Start Program. In accordance with the Financial Accounting Standards Board Accounting Standards Codification® (“ASC”) Topic 840, “Leases”, agreements under the Quick Start Program qualify for sales-type lease accounting. Accordingly, the future minimum lease payments are classified as finance receivables in the Company’s consolidated balance sheets. Finance receivables or Quick Start leases are generally for a sixty month term. Finance receivables are carried at their contractual amount and charged off against the allowance for credit losses when management determines that recovery is unlikely and the Company ceases collection efforts. The Company recognizes a portion of the note or lease payments as interest income in the accompanying consolidated financial statements based on the effective interest rate method. |
INVENTORY | INVENTORY Inventory consists of finished goods and packaging materials. The Company’s inventory is stated at the lower of cost (average cost basis) or market. |
PROPERTY AND EQUIPMENT | PROPERTY AND EQUIPMENT Property and equipment are recorded at cost. Property and equipment are depreciated on the straight-line basis over the estimated useful lives of the related assets. Leasehold improvements are amortized on the straight-line basis over the lesser of the estimated useful life of the asset or the respective lease term. |
INTANGIBLE ASSETS | INTANGIBLE ASSETS The company’s intangible assets include goodwill, trademarks and patents. Goodwill represents the excess of cost over fair value of the net assets purchased in acquisitions. The Company accounts for goodwill in accordance with ASC 350, “Intangibles – Goodwill and Other”. Under ASC 350, goodwill is not amortized to earnings, but instead is subject to periodic testing for impairment. Testing for impairment is to be done at least annually and at other times if events or circumstances arise that indicate that impairment may have occurred. The Company has selected April 1 as its annual test date. The Company has concluded there has been no impairment of goodwill during the fiscal years ended June 30, 2015, 2014 and 2013, respectively. The Company trademarks with an indefinite economic life are not being amortized. The trademarks, not subject to amortization, are related to the miser asset group and consist of the following trademarks: 1) VendingMiser, 2) CoolerMiser, 3) PlugMiser and 4) SnackMiser. The Company tests indefinite-life intangible assets for impairment using a two-step process. The first step screens for potential impairment, while the second step measures the amount of impairment. The Company uses a relief from royalty analysis to complete the first step in this process. Testing for impairment is to be done at least annually and at other times if events or circumstances arise that indicate that impairment may have occurred. The Company has selected April 1 as its annual test date for its indefinite-lived intangible assets. The Company has concluded there has been no impairment of trademarks during the fiscal years ended June 30, 2015, 2014 and 2013, respectively. Patents and trademarks, with an estimated economic life, are carried at cost less accumulated amortization, which is calculated on a straight-line basis over their estimated economic life. Intangible assets with an estimated economic life were fully amortized as of June 30, 2014. |
LONG LIVED ASSETS | LONG LIVED ASSETS In accordance with ASC 360, “Impairment or Disposal of Long-Lived Assets”, the Company reviews its definite lived long-lived assets whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. If the carrying amount of an asset or group of assets exceeds its net realizable value, the asset will be written down to its fair value. In the period when the plan of sale criteria of ASC 360 are met, definite lived long-lived assets are reported as held for sale, depreciation and amortization cease, and the assets are reported at the lower of carrying value or fair value less costs to sell. The Company has concluded that the carrying amount of definite lived long-lived assets is recoverable as of June 30, 2015 and June 30, 2014. |
FAIR VALUE OF FINANCIAL INSTRUMENTS | FAIR VALUE OF FINANCIAL INSTRUMENTS The Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2010-06, “Fair Value Measurements and Disclosures (“Topic 820”): Improving Disclosures about Fair Value Measurements.” ASU 2010-06 amends certain disclosure requirements of Subtopic 820-10. This ASU provides additional disclosures for transfers in and out of Levels 1 and 2 and for activity in Level 3. This ASU also clarifies certain other existing disclosure requirements including level of desegregation and disclosures around inputs and valuation techniques. The Company’s financial assets and liabilities are accounted for in accordance with ASC 820 “Fair Value Measurement.” Under ASC 820 the Company uses inputs from the three levels of the fair value hierarchy to measure its financial assets and liabilities. The three levels are as follows: Level 1- Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. Level 2- Inputs are other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (i.e., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs). Level 3- Inputs are unobservable and reflect the Company’s assumptions that market participants would use in pricing the asset or liability. The Company develops these inputs based on the best information available. The Company’s financial instruments, principally accounts receivable, short-term finance receivables, prepaid expenses and other assets, accounts payable and accrued expenses, are carried at cost which approximates fair value due to the short-term maturity of these instruments. The fair value of the Company’s obligations under its long-term debt credit agreements and the long-term portion of its finance receivables approximates their carrying value as such instruments are at market rates currently available to the Company. |
CONCENTRATION OF RISKS | CONCENTRATION OF RISK Financial instruments that subject the Company to a concentration of credit risk consist principally of cash and accounts and finance receivables. The Company maintains cash with various financial institutions where accounts may exceed federally insured limits at times. Approximately 35% and 22% of the Company’s trade accounts and finance receivables at June 30, 2015 and 2014, respectively, were concentrated with one customer. Concentration of revenues with customers subject the Company to operating risks. Approximately 21%, 26% and 26% of the Company’s license and transaction processing revenues for the years ended June 30, 2015, 2014 and 2013, respectively, were concentrated with one customer. Additionally for the year ended June 30, 2013, approximately 11% of the license and transaction processing fees were with another customer. There was a 17% concentration of equipment sales revenue with one customer for the year ended June 30, 2015 with no concentrations for the years ended June 30, 2014 and 2013. The Company’s customers are principally located in the United States. |
REVENUE RECOGNITION | REVENUE RECOGNITION Revenue from the sale or QuickStart lease of equipment is recognized on the terms of freight-on-board shipping point. Activation fee revenue, if applicable, is recognized when the Company’s cashless payment device is initially activated for use on the Company network. Transaction processing revenue is recognized upon the usage of the Company’s cashless payment and control network. License fees for access to the Company’s devices and network services are recognized on a monthly basis. In all cases, revenue is only recognized when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the price is fixed and determinable, and collection of the resulting receivable is reasonably assured. The Company estimates an allowance for product returns at the date of sale and license and transaction fee refunds on a monthly basis. ePort hardware is available to customers under the QuickStart program pursuant to which the customer would enter into a five-year non-cancelable lease with either the Company or a third-party leasing company for the devices. At the end of the lease period, the customer would have the option to purchase the device for a nominal fee. |
EQUIPMENT RENTAL | EQUIPMENT RENTAL The Company offers its customers a rental program for its ePort devices, the JumpStart program (“JumpStart”). JumpStart terms are typically 36 months and are cancellable with thirty to sixty days’ written notice. In accordance with ASC 840, “Leases”, the Company classifies the rental agreements as operating leases, with service fee revenue related to the leases included in license and transaction fees in the Consolidated Statements of Operations. Cost for the JumpStart revenues, which consists of depreciation expense on the JumpStart equipment, is included in cost of services in the Consolidated Statements of Operations. ePort equipment utilized by the JumpStart program is included in property and equipment, net on the Consolidated Balance Sheet. |
WARRANTY COSTS | WARRANTY COSTS The Company generally warrants its products for one to three years. Warranty costs are estimated and recorded at the time of sale based on historical warranty experience, if available. These costs are reviewed and adjusted, if necessary, periodically throughout the year. |
SHIPPING AND HANDLING | SHIPPING AND HANDLING Shipping and handling fees billed to our customers in connection with sales are recorded as revenue. The costs incurred for shipping and handling of our product are recorded as cost of equipment. |
RESEARCH AND DEVELOPMENT EXPENSES | RESEARCH AND DEVELOPMENT EXPENSES Research and development expenses are expensed as incurred. Research and development expenses, which are included in selling, general and administrative expenses in the Consolidated Statements of Operations, were approximately $1,457,000, $1,018,000 and $901,000, for the years ended June 30, 2015, 2014, and 2013, respectively. Our research and development initiatives focus on adding features and functionality to our system solutions through the development and utilization of our processing and reporting network and new technology. |
ACCOUNTING FOR EQUITY AWARDS | ACCOUNTING FOR EQUITY AWARDS In accordance with ASC 718 the cost of employee services received in exchange for an award of equity instruments is based on the grant-date fair value of the award and allocated over the requisite service period of the award. |
INCOME TAXES | INCOME TAXES The Company follows the provisions of FASB ASC 740, Accounting for Uncertainty in Income Taxes, Income taxes are computed using the asset and liability method of accounting. Under the asset and liability method, a deferred tax asset or liability is recognized for estimated future tax effects attributable to temporary differences and carryforwards. The measurement of deferred income tax assets is adjusted by a valuation allowance, if necessary, to recognize future tax benefits only to the extent, based on available evidence, it is more likely than not such benefits will be realized. The Company recognizes interest and penalties, if any, related to uncertain tax positions in selling, general and administrative expenses. No interest or penalties related to uncertain tax positions were accrued or incurred during the years ended June 30, 2015, 2014, and 2013. The Company files income tax returns in the United States federal jurisdiction and various state jurisdictions. The tax years ended June 30, 2012 through June 30, 2015 remain open to examination by taxing jurisdictions to which the Company is subject. As of June 30, 2015, the Company did not have any income tax examinations in process. |
EARNINGS (LOSS) PER COMMON SHARE | EARNINGS (LOSS) PER COMMON SHARE Basic earnings (loss) per share are calculated by dividing net income (loss) applicable to common shares by the weighted average common shares outstanding for the period. Diluted earnings (loss) per share are calculated by dividing net income (loss) applicable to common shares by the weighted average common shares outstanding for the period plus the dilutive effects of common stock equivalents unless the effects of such common stock equivalents is anti-dilutive. For the years ended June 30, 2015 and 2014 no effect for common stock equivalents was considered in the calculation of diluted earnings (loss) per share because their effect was anti-dilutive. For the year ended June 30, 2013 the dilutive effect for 825,673 shares of common stock equivalents was considered in the calculation of diluted earnings (loss) per share. |
COMPREHENSIVE INCOME | COMPREHENSIVE INCOME ASC 220, “Comprehensive Income”, prescribes the reporting required for comprehensive income and items of other comprehensive income. Entities having no items of other comprehensive income are not required to report on comprehensive income. The Company has no items of other comprehensive income for its years ended June 30, 2015, 2014 or 2013. |
RECENT ACCOUNTING PRONOUCEMENTS | RECENT ACCOUNTING PRONOUCEMENTS The Company is evaluating whether the effects of the following recent accounting pronouncements or any other recently issued, but not yet effective accounting standards, will have a material effect on the Company’s consolidated financial position, results of operations or cash flows. In May 2014, the Financial Accounting Standards Board issued ASU 2014-09 Revenue from Contracts with Customers (Topic 606). This pronouncement will be effective for the Company beginning with the year ending June 30, 2019. In June 2014, the Financial Accounting Standards Board issued ASU 2014-12 Compensation- Stock Compensation (Topic 718); Accounting for share-based payments when the terms of the award provide that a performance target could be achieved after the requisite service period. This pronouncement will be effective for the Company beginning with the year ending June 30, 2017. In August 2014, the Financial Accounting Standards Board issued ASU 2014-15 Presentation of Financial Statements- Going Concern (Subtopic 205-40): Disclosure of uncertainties about an entity’s ability to continue as a going concern. This pronouncement will be effective for the Company beginning with the year ending June 30, 2018. In April 2015, the Financial Accounting Standards Board issued ASU 2015-03 Interest- Imputation of Interest (Subtopic 835-30): Simplifying the presentation of debt issuance costs. This pronouncement will be effective for the Company beginning with the year ending June 30, 2017. In July 2015, the Financial Accounting Standards Board issued ASU 2015-11 Inventory (Topic 330): Simplifying the measurement of inventory. This pronouncement will be effective for the Company beginning with the year ending June 30, 2018. |
RECLASSIFICATION | RECLASSIFICATION Certain amounts in the prior period financial statements have been reclassified to conform to the current period presentation. |
FINANCE RECEIVABLES (Tables)
FINANCE RECEIVABLES (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Receivables [Abstract] | |
Schedule of finance receivables | June 30, June 30, 2015 2014 Total finance receivables $ 4,638,663 $ 472,587 Less current portion 941,150 119,793 Non-current portion of finance receivables $ 3,697,513 $ 352,794 |
Schedule of credit quality indicators | Credit risk profile based on payment activity: June 30, June 30, Performing $ 4,618,458 $ 472,587 Nonperforming 20,205 - Total $ 4,638,663 $ 472,587 |
Schedule of age analysis of past due finance receivables | Age Analysis of Past Due Finance Receivables As of June 30, 31 – 60 61 – 90 Greater than Total Days Past Due Days Past Due 90 Days Past Due Total Past Due Current Finance Receivables QuickStart Leases - 2015 $ - $ 15,574 $ 4,630 $ 20,205 $ 4,618,458 $ 4,638,663 QuickStart Leases - 2014 $ - $ 909 $ 378 $ 1,287 $ 471,300 $ 472,587 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | Useful June 30, 2015 Lives Cost Accumulated Net Computer equipment and purchased software 3-7 years $ 4,669,485 $ (4,016,635 ) $ 652,850 Property and equipment used for rental program 5 years 26,469,057 (14,475,816 ) $ 11,993,241 Furniture and equipment 3-7 years 723,047 (571,933 ) $ 151,114 Leasehold improvements Lesser of life or lease term 575,343 (503,740 ) $ 71,603 $ 32,436,932 $ (19,568,124 ) $ 12,868,808 Useful June 30, 2014 Lives Cost Accumulated Net Computer equipment and purchased software 3-7 years $ 4,581,001 $ (3,612,551 ) $ 968,450 Property and equipment used for rental program 5 years 30,348,918 (10,524,701 ) $ 19,824,217 Furniture and equipment 3-7 years 681,717 (498,995 ) $ 182,722 Leasehold improvements Lesser of life or lease term 575,343 (412,152 ) $ 163,191 $ 36,186,979 $ (15,048,399 ) $ 21,138,580 2015 2014 2013 Depreciation expense $ 5,694,452 $ 5,459,064 $ 3,837,174 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible asset balances | Beginning Year ended June 30, 2015 Ending Balance Additions/ Balance Amortization July 1, 2014 Adjustments Amortization June 30, 2015 Period Intangible assets: Goodwill $ 7,663,208 $ - $ - $ 7,663,208 Indefinite Trademarks - Indefinite 432,100 - - 432,100 Indefinite Trademarks - Amortizable - - - - 10 years Patents - - - - 10 years Total $ 8,095,308 $ - $ - $ 8,095,308 Beginning Year ended June 30, 2014 Ending Balance Additions/ Balance Amortization July 1, 2013 Adjustments Amortization June 30, 2014 Period Intangible assets: Goodwill $ 7,663,208 $ - $ - $ 7,663,208 Indefinite Trademarks - Indefinite 432,100 - - 432,100 Indefinite Trademarks - Amortizable 21,953 - (21,953 ) - 10 years Patents - - - - 10 years Total $ 8,117,261 $ - $ (21,953 ) $ 8,095,308 |
ACCRUED EXPENSES (Tables)
ACCRUED EXPENSES (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Accrued Liabilities [Abstract] | |
Schedule of accrued expenses | June 30, June 30, 2015 2014 Accrued compensation and related sales commissions $ 672,628 $ 545,110 Accrued professional fees 301,150 214,615 Accrued taxes and filing fees 505,300 640,958 Advanced customer billings 390,023 370,040 Accrued rent 74,601 155,712 Accrued other 212,988 175,538 2,156,690 2,101,973 Less current portion (2,107,530 ) (1,915,799 ) $ 49,160 $ 186,174 |
LINE OF CREDIT (Tables)
LINE OF CREDIT (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Line Of Credit Facility [Abstract] | |
Schedule of line of credit facilities | As of or Twelve Months Ended June 30, 2015 2014 Balance at period-end $ 4,000,000 $ 5,000,000 Maximum amount outstanding at any month end $ 5,000,000 $ 5,000,000 Average balance outstanding during the period $ 4,077,000 $ 4,154,000 Weighted-average interest rate: As of the period-end 5.25 % 5.25 % Paid during the period 5.25 % 5.25 % |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt | June 30, June 30, 2015 2014 Capital lease obligations $ 337,597 $ 414,525 Other loan agreements - 8,251 Lease financing obligations 1,994,349 - 2,331,946 422,776 Less current portion 477,522 172,911 $ 1,854,424 $ 249,865 |
Schedule of maturities of long-term debt | The maturities of long-term debt for each of the fiscal years following June 30, 2015 are as follows: 2016 $ 477,522 2017 502,749 2018 488,929 2019 486,928 2020 371,237 Thereafter 4,581 $ 2,331,946 |
FAIR VALUE OF FINANCIAL INSTR31
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Schedule of fair value of financial instruments required to be measured at fair value | June 30, 2015 Level 1 Level 2 Level 3 Total Common stock warrant liability, warrants exercisable at $2.6058 from September 18, 2011 through September 18, 2016 $ - $ - $ 978,353 $ 978,353 June 30, 2014 Level 1 Level 2 Level 3 Total Common stock warrant liability, warrants exercisable at $2.6058 from September 18, 2011 through September 18, 2016 $ - $ - $ 585,209 $ 585,209 |
Schedule of changes in fair value of the company's level 3 financial instruments | June 30, 2015 2014 Beginning balance $ (585,209 ) $ (650,638 ) Gain (loss) due to change in fair value of warrant liabilities, net (393,144 ) 65,429 Ending balance $ (978,353 ) $ (585,209 ) |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Schedule of benefit (provision) for income taxes | 2015 2014 2013 Current: Federal $ (58,028 ) $ (21,021 ) $ - State (6,325 ) - - (64,353 ) (21,021 ) - Deferred: Federal 365,143 20,970,149 (20,842 ) State (589,931 ) 6,306,270 (6,804 ) (224,788 ) 27,276,419 (27,646 ) $ (289,141 ) $ 27,255,398 $ (27,646 ) |
Schedule of income tax benefit in the provision for income taxes | 2015 2014 2013 Indicated benefit (provision) at federal statutory rate of 34% $ 272,116 $ (93,586 ) $ (299,801 ) Effects of permanent differences (215,271 ) (8,168 ) 71,379 State income taxes, net of federal benefit (410,410 ) (17,989 ) (4,490 ) Income tax credits 40,000 - - Changes related to prior years 187,373 - - Change in valuation allowances (162,949 ) 27,375,141 205,266 $ (289,141 ) $ 27,255,398 $ (27,646 ) |
Schedule of deferred tax assets and liabilities | June 30, 2015 2014 Deferred tax assets: Net operating loss carryforwards $ 46,919,363 $ 47,776,042 Asset reserves 791,915 391,155 Deferred research and development costs 1,009,303 710,640 Intangibles 605,836 907,274 Deferred gain on assets under sale-leaseback transaction 632,317 460,902 Stock-based compensation 223,883 250,426 Other 436,510 348,885 50,619,127 50,845,324 Deferred tax liabilities: Fixed assets (491,990 ) (683,159 ) Intangibles and goodwill (84,520 ) (67,459 ) Deferred tax assets, net 50,042,617 50,094,706 Valuation allowance (22,996,634 ) (22,833,685 ) Deferred tax assets (liabilties), net of allowance 27,045,983 27,261,021 Less current portion 1,257,796 907,691 Deferred tax assets (liabilties), non-current $ 25,788,187 $ 26,353,330 |
PREFERRED STOCK (Tables)
PREFERRED STOCK (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Preferred Stock [Abstract] | |
Schedule of preferred stock | 2015 2014 Shares outstanding at $10.00 per share $ 4,429,680 $ 4,429,680 Cumulative unpaid dividends 12,925,228 12,260,776 $ 17,354,908 $ 16,690,456 |
STOCK BASED COMPENSATION PLANS
STOCK BASED COMPENSATION PLANS (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of stock based compensation plans | Date Approved Name of Plan Type of Plan Authorized Shares June 2013 2013 Stock Incentive Plan Stock 500,000 June 2014 2014 Stock Option Incentive Plan Stock Options 750,000 June 2015 2015 Equity Incentive Plan Stock + Stock Options 1,250,000 2,500,000 |
Schedule of common stock for future issuance | As of June 30, 2015, the Company had reserved shares of Common Stock for future issuance for the following: Exercise of Common Stock Warrants 4,309,000 Conversions of Preferred Stock and cumulative Preferred Stock dividends 98,861 Issuance under 2013 Stock Incentive Plan 321,111 Issuance under 2014 Stock Option Incentive Plan 750,000 Issuance under 2015 Equity Incentive Plan 1,250,000 Issuance to former Chief Executive Officer upon a prescribed transaction 140,000 Total shares reserved for future issuance 6,868,972 |
Schedule of stock option granted weighted average assumptions | Year ended Year ended June 30, 2015 June 30, 2014 Expected volatility 78-79% 79% Expected life 7 years 7 years Expected dividends 0.00% 0.00% Risk-free interest rate 1.59-2.04 2.22% |
Schedule of options outstanding | For the Twelve Months Ended June 30, 2015 2014 2013 Shares Weighted Weighted Shares Weighted Weighted Shares Weighted Weighted Options outstanding, beginning of period 120,000 $ 2.05 $ 1.49 - $ - $ - 45,333 $ 7.53 $ 5.34 Granted 438,888 $ 1.82 $ 1.30 120,000 $ 2.05 $ 1.49 - $ - $ - Forfeited (20,000 ) $ 2.05 $ 1.49 - $ - $ - - $ - $ - Expired - $ - $ - - $ - $ - (45,333 ) $ 7.53 $ 5.34 Exercised - $ - $ - - $ - $ - - $ - $ - Options outstanding, end of period 538,888 $ 1.86 $ 1.33 120,000 $ 2.05 $ 1.49 - $ - $ - |
Schedule of common stock option activity | The following table provides information related to options as of June 30, 2015: Options Outstanding Options Exercisable Range of Exercise Prices Options Remaining Shares Remaining Weighted $1.62 to $1.68 75,000 6.51 - N/A N/A $1.78 328,888 6.16 - N/A N/A $2.05 100,000 5.97 33,335 5.97 $ 2.05 $2.09 10,000 6.58 - N/A N/A $2.75 25,000 6.77 - N/A N/A 538,888 6.21 33,335 5.97 $ 2.05 |
Schedule of unvested options outstanding | For the Twelve Months Ended June 30, 2015 2014 2013 Shares Weighted Shares Weighted Shares Weighted Unvested options, beginning of period 120,000 $ 1.49 - - - - Granted 438,888 $ 1.30 120,000 $ 1.49 - - Vested (33,335 ) $ 1.49 - - - - Forfeited (20,000 ) $ 1.49 - - - - Unvested options, end of period 505,553 $ 1.32 120,000 $ 1.49 - $ - |
Schedule of share based compensation arrangement by share based payment award, options outstanding and exercisable options | As of June 30, 2015 2014 2013 Options Exercisable Options Exercisable Options Exercisable Number 538,888 33,335 120,000 - - - Weighted average exercise price $ 1.86 $ 2.05 $ 2.05 $ - $ - $ - Aggregate intrinsic value $ 451,177 $ 21,668 $ 7,200 $ - $ - $ - Weighted average contractual term 6.21 5.97 6.97 - - - Share price as of June 30 $ 2.70 $ 2.70 $ 2.11 $ 2.11 $ 1.74 $ 1.74 |
Schedule of nonvested share activity | Weighted-Average Grant-Date Shares Fair Value Nonvested Shares Nonvested at June 30, 2012 172,003 $ 1.82 Granted 156,429 1.45 Vested (204,587 ) 1.72 Forfeited, Employee shares not earned (26,699 ) 1.52 Nonvested at June 30, 2013 97,146 $ 1.52 Granted 10,000 2.17 Vested (55,001 ) 1.62 Forfeited, Director changes (3,334 ) 0.94 Forfeited, Employee shares not earned (5,000 ) 1.52 Nonvested at June 30, 2014 43,811 $ 1.59 Granted 155,927 2.00 Vested (181,134 ) 1.89 Nonvested at June 30, 2015 18,604 $ 1.88 |
WARRANTS (Tables)
WARRANTS (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Warrants [Abstract] | |
Schedule exercise prices and expiration dates for warrants | Exercise Warrants Price Expiration Outstanding Per Share Date 4,264,000 $ 2.61 September 18, 2016 45,000 $ 2.10 December 31, 2017 4,309,000 |
Schedule of common stock warrant activity | Warrants Outstanding at June 30, 2012 8,045,619 Issued 45,000 Exercised (399,597 ) Expired (329,314 ) Outstanding at June 30, 2013 7,361,708 Issued - Exercised (2,090,226 ) Expired (962,482 ) Outstanding at June 30, 2014 4,309,000 Issued - Exercised - Expired - Outstanding at June 30, 2015 4,309,000 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of gain on sale of ePort equipment | Year ended Year ended Rental equipment sold, cost $ 3,873,275 $ 1,918,920 Rental equipment sold, accumulated depreciation upon sale (331,069 ) (76,032 ) Rental equipment sold, net book value 3,542,206 1,842,888 Proceeds from sale 4,993,879 2,995,095 Gain on sale of rental equipment $ 1,451,673 $ 1,152,207 |
Schedule of amount of gain recognized in consolidated statement of operations | Year ended Year ended Beginning balance $ 1,142,685 $ - Gain on sale of rental equipment 1,451,673 1,152,207 Recognition of deferred gain (833,619 ) (9,522 ) Ending balance 1,760,739 1,142,685 Less current portion 860,391 380,895 Non-current portion of deferred gain $ 900,348 $ 761,790 |
Schedule of capital leases and non-cancellable operating leases | Operating Leases Other Operating Total Operating Capital from Sale Leaseback Leases Leases Leases 2016 $ 2,641,155 $ 361,927 $ 3,003,082 $ 157,304 2017 2,641,155 810 2,641,965 131,585 2018 137,731 - 137,731 70,416 2019 - - - 23,361 Total minimum lease payments $ 5,420,041 $ 362,737 $ 5,782,778 $ 382,666 Less amount representing interest 45,069 Present value of net minimum lease payments 337,597 Less current obligations under capital leases 131,583 Obligations under capital leases, less current portion $ 206,014 |
BUSINESS (Detail Textuals)
BUSINESS (Detail Textuals) | 12 Months Ended |
Jun. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Term of non cancelable lease with agreement | 5 years |
ACCOUNTING POLICIES (Detail Tex
ACCOUNTING POLICIES (Detail Textuals) - USD ($) | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Accounting Policies [Abstract] | |||
Term of notes receivable or quick start leases | 60 months | ||
Research and development expenses | $ 1,457,000 | $ 1,018,000 | $ 901,000 |
Description rental JumpStart program for ePort devices | The Company offers its customers a rental program for its ePort devices, the JumpStart program ("JumpStart"). JumpStart terms are typically 36 months and are cancellable with thirty to sixty days' written notice. | ||
Term of products warranty | 3 years |
ACCOUNTING POLICIES (Detail T39
ACCOUNTING POLICIES (Detail Textuals 1) - Customer | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
License and transaction processing revenues | Customer one | |||
Concentration Risk [Line Items] | |||
Concentration percentage | 21.00% | 26.00% | 26.00% |
Number of customers | 1 | 1 | 1 |
License and transaction processing revenues | Another customer | |||
Concentration Risk [Line Items] | |||
Concentration percentage | 11.00% | ||
Equipment sales revenue | Customer one | |||
Concentration Risk [Line Items] | |||
Concentration percentage | 17.00% | ||
Number of customers | 1 | ||
Trade accounts and finance receivables | Customer one | |||
Concentration Risk [Line Items] | |||
Concentration percentage | 35.00% | 22.00% | |
Number of customers | 1 | 1 |
ACCOUNTING POLICIES (Detail T40
ACCOUNTING POLICIES (Detail Textuals 2) | 12 Months Ended |
Jun. 30, 2013shares | |
Conversion of cumulative preferred dividends | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Shares or warrants assumed to calculate weighted average common shares outstanding | 825,673 |
FINANCE RECEIVABLES - Informati
FINANCE RECEIVABLES - Information regarding finance receivables (Details) - USD ($) | Jun. 30, 2015 | Jun. 30, 2014 |
Receivables [Abstract] | ||
Total finance receivables | $ 4,638,663 | $ 472,587 |
Less current portion | 941,150 | 119,793 |
Non-current portion of finance receivables | $ 3,697,513 | $ 352,794 |
FINANCE RECEIVABLES - Credit ri
FINANCE RECEIVABLES - Credit risk profile based on payment activity (Details 1) - USD ($) | Jun. 30, 2015 | Jun. 30, 2014 |
Financing Receivable, Recorded Investment [Line Items] | ||
Total finance receivables | $ 4,638,663 | $ 472,587 |
Performing | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total finance receivables | 4,618,458 | $ 472,587 |
Nonperforming | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total finance receivables | $ 20,205 |
FINANCE RECEIVABLES - Age analy
FINANCE RECEIVABLES - Age analysis of past due finance receivables (Details 2) - USD ($) | Jun. 30, 2015 | Jun. 30, 2014 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Finance Receivables | $ 4,638,663 | $ 472,587 |
QuickStart Leases | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 20,205 | 1,287 |
Current | 4,618,458 | 471,300 |
Total Finance Receivables | $ 4,638,663 | $ 472,587 |
QuickStart Leases | 31- 60 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | ||
QuickStart Leases | 61- 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | $ 15,574 | $ 909 |
QuickStart Leases | Greater than 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | $ 4,630 | $ 378 |
PROPERTY AND EQUIPMENT - Summar
PROPERTY AND EQUIPMENT - Summary of property and equipment at cost (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 32,436,932 | $ 36,186,979 |
Less accumulated depreciation | (19,568,124) | (15,048,399) |
Property and equipment, net | $ 12,868,808 | 21,138,580 |
Computer equipment purchased software | ||
Property, Plant and Equipment [Line Items] | ||
Useful lives | 3-7 years | |
Property, plant and equipment, gross | $ 4,669,485 | 4,581,001 |
Less accumulated depreciation | (4,016,635) | (3,612,551) |
Property and equipment, net | $ 652,850 | 968,450 |
Property and equipment used for rental program | ||
Property, Plant and Equipment [Line Items] | ||
Useful lives | 5 years | |
Property, plant and equipment, gross | $ 26,469,057 | 30,348,918 |
Less accumulated depreciation | (14,475,816) | (10,524,701) |
Property and equipment, net | $ 11,993,241 | 19,824,217 |
Furniture and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Useful lives | 3-7 years | |
Property, plant and equipment, gross | $ 723,047 | 681,717 |
Less accumulated depreciation | (571,933) | (498,995) |
Property and equipment, net | $ 151,114 | 182,722 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Useful lives | Lesser of life or lease term | |
Property, plant and equipment, gross | $ 575,343 | 575,343 |
Less accumulated depreciation | (503,740) | (412,152) |
Property and equipment, net | $ 71,603 | $ 163,191 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details 1) - USD ($) | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation expense | $ 5,694,452 | $ 5,459,064 | $ 3,837,174 |
PROPERTY AND EQUIPMENT (Detail
PROPERTY AND EQUIPMENT (Detail Textuals) - USD ($) | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Property, Plant and Equipment [Abstract] | |||
Assets under capital leases | $ 2,139,000 | $ 2,031,000 | |
Capital lease amortization included in depreciation expense | $ 349,000 | $ 305,000 | $ 265,000 |
INTANGIBLE ASSETS - Summary of
INTANGIBLE ASSETS - Summary of intangible assets (Details) - USD ($) | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Goodwill [Roll Forward] | |||
Goodwill, Beginning Balance | $ 7,663,208 | $ 7,663,208 | |
Goodwill, Additions / Adjustments | |||
Goodwill, Amortization | |||
Goodwill, Ending Balance | $ 7,663,208 | $ 7,663,208 | $ 7,663,208 |
Goodwill, Amortization Period | Indefinite | Indefinite | |
Finite-lived Intangible Assets [Roll Forward] | |||
Amortization | $ 0 | $ 22,000 | 742,000 |
Intangible Assets, Net (Including Goodwill) [Abstract] | |||
Intangible Assets, Beginning Balance | $ 8,095,308 | $ 8,117,261 | |
Intangible Assets, Additions | |||
Intangible Assets, Amortization | $ (21,953) | ||
Intangible Assets, Ending Balance | $ 8,095,308 | 8,095,308 | 8,117,261 |
Trademarks | |||
Indefinite-lived Intangible Assets [Roll Forward] | |||
Indefinite Intangible Assets, Beginning Balance | $ 432,100 | $ 432,100 | |
Additions / Adjustments | |||
Amortization | |||
Indefinite Intangible Assets, Ending Balance | $ 432,100 | $ 432,100 | 432,100 |
Amortization Period | Indefinite | Indefinite | |
Trademarks | |||
Finite-lived Intangible Assets [Roll Forward] | |||
Beginning Balance | $ 21,953 | ||
Additions / Adjustments | |||
Amortization | $ (21,953) | ||
Ending Balance | $ 21,953 | ||
Amortization Period | 10 years | 10 years | |
Patents | |||
Finite-lived Intangible Assets [Roll Forward] | |||
Beginning Balance | |||
Additions / Adjustments | |||
Amortization | |||
Ending Balance | |||
Amortization Period | 10 years | 10 years |
INTANGIBLE ASSETS - (Detail Tex
INTANGIBLE ASSETS - (Detail Textuals) - USD ($) | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Amortization expense of acquired intangible assets | $ 0 | $ 22,000 | $ 742,000 |
ACCRUED EXPENSES - Information
ACCRUED EXPENSES - Information regarding accrued expenses (Details) - USD ($) | Jun. 30, 2015 | Jun. 30, 2014 |
Accrued Liabilities [Abstract] | ||
Accrued compensation and related sales commissions | $ 672,628 | $ 545,110 |
Accrued professional fees | 301,150 | 214,615 |
Accrued taxes and filing fees | 505,300 | 640,958 |
Advanced customer billings | 390,023 | 370,040 |
Accrued rent | 74,601 | 155,712 |
Accrued other | 212,988 | 175,538 |
Accrued expenses, total | 2,156,690 | 2,101,973 |
Less current portion | (2,107,530) | (1,915,799) |
Accrued expenses, less current portion | $ 49,160 | $ 186,174 |
LINE OF CREDIT - Summary of lin
LINE OF CREDIT - Summary of line of credit (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Line Of Credit Facility [Abstract] | ||
Balance at period-end | $ 4,000,000 | $ 5,000,000 |
Maximum amount outstanding at any month end | 5,000,000 | 5,000,000 |
Average balance outstanding during the period | $ 4,077,000 | $ 4,154,000 |
Weighted-average interest rate: | ||
As of the period-end | 5.25% | 5.25% |
Paid during the period | 5.25% | 5.25% |
LINE OF CREDIT (Detail Textuals
LINE OF CREDIT (Detail Textuals) - USD ($) | Jul. 10, 2012 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 |
Line of Credit Facility [Line Items] | ||||
Exercise price per share | $ 2.6058 | $ 2.6058 | ||
Warrants issued in conjunction with Line of Credit Amendment | $ 55,962 | |||
Non-cash interest and amortization of debt discount | $ 2,095 | 53,867 | ||
Interest expense | $ 301,767 | 256,844 | 157,205 | |
Line of Credit | ||||
Line of Credit Facility [Line Items] | ||||
Interest expense | 211,000 | 221,000 | $ 84,000 | |
Line of Credit | Commercial Bank | Loan and Security Agreement | ||||
Line of Credit Facility [Line Items] | ||||
Maximum limit of amount under line of credit | $ 7,000,000 | |||
Line of credit facility, basis of measurement | Prime rate | |||
Line of credit facility, interest rate description | The outstanding balance of the amounts advanced under the line of credit will bear interest at 2% above the prime rate as published in The Wall Street Journal or 5% whichever is higher. | |||
Percentage of interest rate above prime rate | 2.00% | |||
Percentage of interest rate on line of credit | 5.00% | |||
Line of Credit | Commercial Bank | Warrants | Loan and Security Agreement | ||||
Line of Credit Facility [Line Items] | ||||
Number of common stock called by warrants | 45,000 | |||
Exercise price per share | $ 2.10 | |||
Warrants issued in conjunction with Line of Credit Amendment | $ 55,962 | |||
Non-cash interest and amortization of debt discount | $ 0 | $ 2,095 | $ 53,867 |
LONG-TERM DEBT - Long-term debt
LONG-TERM DEBT - Long-term debt (Details) - USD ($) | Jun. 30, 2015 | Jun. 30, 2014 |
Debt Instrument [Line Items] | ||
Long-term debt | $ 2,331,946 | $ 422,776 |
Less current portion | 477,522 | 172,911 |
Long-term debt, less current portion | 1,854,424 | 249,865 |
Capital Lease Obligations | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 337,597 | 414,525 |
Other loan agreements | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 8,251 | |
Lease financing obligations | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 1,994,349 |
LONG-TERM DEBT-Maturities of lo
LONG-TERM DEBT-Maturities of long-term debt (Details 1) - USD ($) | Jun. 30, 2015 | Jun. 30, 2014 |
Debt Disclosure [Abstract] | ||
2,016 | $ 477,522 | |
2,017 | 502,749 | |
2,018 | 488,929 | |
2,019 | 486,928 | |
2,020 | 371,237 | |
Thereafter | 4,581 | |
Long-term debt | $ 2,331,946 | $ 422,776 |
LONG-TERM DEBT (Detail Textuals
LONG-TERM DEBT (Detail Textuals) - USD ($) | 12 Months Ended | ||||
Jun. 30, 2015 | May. 31, 2015 | Feb. 28, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Debt Instrument [Line Items] | |||||
Term of notes receivable or quick start leases | 60 months | ||||
Capital Lease Obligations | |||||
Debt Instrument [Line Items] | |||||
Capital lease obligations | $ 108,000 | $ 325,000 | $ 108,000 | ||
Capital Lease Obligations | Minimum | |||||
Debt Instrument [Line Items] | |||||
Percentage of interest rates | 4.89% | ||||
Capital Lease Obligations | Maximum | |||||
Debt Instrument [Line Items] | |||||
Percentage of interest rates | 13.88% | ||||
Other Loan Agreements | |||||
Debt Instrument [Line Items] | |||||
Capital lease obligations | $ 108,000 | $ 325,000 | $ 108,000 | ||
Other Loan Agreements | Minimum | |||||
Debt Instrument [Line Items] | |||||
Percentage of interest rates | 4.90% | ||||
Other Loan Agreements | Maximum | |||||
Debt Instrument [Line Items] | |||||
Percentage of interest rates | 13.90% | ||||
Assignment Of Quickstart Leases | |||||
Debt Instrument [Line Items] | |||||
Financing lease obligations | $ 304,008 | $ 1,752,717 | |||
Assignment Of Quickstart Leases | Minimum | |||||
Debt Instrument [Line Items] | |||||
Percentage of interest rates | 9.41% | ||||
Assignment Of Quickstart Leases | Maximum | |||||
Debt Instrument [Line Items] | |||||
Percentage of interest rates | 9.45% |
FAIR VALUE OF FINANCIAL INSTR55
FAIR VALUE OF FINANCIAL INSTRUMENTS - Fair value of the company financial instruments that are required to be measured at fair value (Details) - USD ($) | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Common stock warrant liability, warrants exercisable at $2.6058 from September 18, 2011 through September 18, 2016 | $ 978,353 | $ 585,209 | $ 650,638 |
Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Common stock warrant liability, warrants exercisable at $2.6058 from September 18, 2011 through September 18, 2016 | |||
Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Common stock warrant liability, warrants exercisable at $2.6058 from September 18, 2011 through September 18, 2016 | |||
Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Common stock warrant liability, warrants exercisable at $2.6058 from September 18, 2011 through September 18, 2016 | $ 978,353 | $ 585,209 |
FAIR VALUE OF FINANCIAL INSTR56
FAIR VALUE OF FINANCIAL INSTRUMENTS - Fair value of the company financial instruments that are required to be measured at fair value (Parentheticals) (Details) - $ / shares | Jun. 30, 2015 | Jun. 30, 2014 |
Fair Value Disclosures [Abstract] | ||
Exercise price of warrants per share | $ 2.6058 | $ 2.6058 |
FAIR VALUE OF FINANCIAL INSTR57
FAIR VALUE OF FINANCIAL INSTRUMENTS - Changes in fair value of the Company level 3 financial instruments (unaudited) (Details 1) - USD ($) | 12 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning balance | $ (585,209) | $ (650,638) |
Gain (loss) due to change in fair value of warrant liabilities, net | (393,144) | 65,429 |
Ending balance | $ (978,353) | $ (585,209) |
FAIR VALUE OF FINANCIAL INSTR58
FAIR VALUE OF FINANCIAL INSTRUMENTS (Detail Textuals) - Level 3 shares in Millions | 1 Months Ended |
Mar. 31, 2011shares | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Number of common stock called by warrants | 3.9 |
Valuation method used to determine fair value | proprietary valuation models |
INCOME TAXES - Summary of benef
INCOME TAXES - Summary of benefit (provision) for income taxes (Details) - USD ($) | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Current: | |||
Federal | $ (58,028) | $ (21,021) | |
State | (6,325) | ||
Current income tax (expense) benefit | (64,353) | (21,021) | |
Deferred: | |||
Federal | 365,143 | 20,970,149 | $ (20,842) |
State | (589,931) | 6,306,270 | (6,804) |
Deferred tax (expense) benefit | (224,788) | 27,276,419 | (27,646) |
Benefit (provision) for income taxes | $ (289,141) | $ 27,255,398 | $ (27,646) |
INCOME TAXES - Summary of recon
INCOME TAXES - Summary of reconciliation of the benefit (provision) for income taxes (Details 1) - USD ($) | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Income Tax Disclosure [Abstract] | |||
Indicated benefit (provision) at federal statutory rate of 34% | $ 272,116 | $ (93,586) | $ (299,801) |
Effects of permanent differences | (215,271) | (8,168) | 71,379 |
State income taxes, net of federal benefit | (410,410) | (17,989) | (4,490) |
Income tax credits | 40,000 | ||
Changes related to prior years | 187,373 | ||
Change in valuation allowances | (162,949) | 27,375,141 | 205,266 |
Benefit (provision) for income taxes | $ (289,141) | $ 27,255,398 | $ (27,646) |
INCOME TAXES - Summary of net d
INCOME TAXES - Summary of net deferred tax assets (Details 2) - USD ($) | Jun. 30, 2015 | Jun. 30, 2014 |
Deferred tax assets: | ||
Net operating loss carryforwards | $ 46,919,363 | $ 47,776,042 |
Asset reserves | 791,915 | 391,155 |
Deferred research and development costs | 1,009,303 | 710,640 |
Intangibles | 605,836 | 907,274 |
Deferred gain on assets under sale-leaseback transaction | 632,317 | 460,902 |
Stock-based compensation | 223,883 | 250,426 |
Other | 436,510 | 348,885 |
Deferred tax assets, gross | 50,619,127 | 50,845,324 |
Deferred tax liabilities: | ||
Fixed assets | (491,990) | (683,159) |
Intangibles and goodwill | (84,520) | (67,459) |
Deferred tax assets, net | 50,042,617 | 50,094,706 |
Valuation allowance | (22,996,634) | (22,833,685) |
Deferred tax assets (liabilities), net of allowance | 27,045,983 | 27,261,021 |
Less current portion | 1,257,796 | 907,691 |
Deferred tax assets (liabilities), non-current | $ 25,788,187 | $ 26,353,330 |
INCOME TAXES (Detail Textuals)
INCOME TAXES (Detail Textuals) - USD ($) | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Income Tax Disclosure [Abstract] | |||
Reduction valuation allowances recorded in prior periods | $ 27,000,000 | ||
Deferred tax liabilities | $ 40,245 | ||
Valuation allowances of relating to operating loss carryforward | $ 64,000,000 | ||
Valuation allowance | 22,996,634 | $ 22,833,685 | |
State and federal income tax effects | $ 395,605 | $ (27,646) | |
Federal statutory rate | 34.00% | 34.00% | |
Net operating loss carryforwards | $ 163,000,000 | ||
Maximum amount of net operating loss carryforwards | $ 125,000,000 |
PREFERRED STOCK - Preferred sto
PREFERRED STOCK - Preferred stock liquidation preference (Details) - Series A Preferred Stock - USD ($) | 12 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Class Of Stock [Line Items] | ||
Shares outstanding at $10.00 per share | $ 4,429,680 | $ 4,429,680 |
Cumulative unpaid dividends | 12,925,228 | 12,260,776 |
Preferred Stock liquidation preference | $ 17,354,908 | $ 16,690,456 |
PREFERRED STOCK (Detail Textual
PREFERRED STOCK (Detail Textuals) - Series A Preferred Stock | 12 Months Ended |
Jun. 30, 2015$ / sharesshares | |
Class of Stock [Line Items] | |
Preferred stock voting rights | 0.194 of a vote |
Series A preferred stock annual cumulative dividend price per share (in dollars per share) | $ 1.50 |
Series A preferred stock, redemption price per share (in dollars per share) | 11 |
Liquidation price to be received by series A preferred stock holder for each outstanding share plus all cumulative unpaid dividends (in dollars per share) | $ 10 |
Common Stock | |
Class of Stock [Line Items] | |
Preferred shares converted into common stock | shares | 0.194 |
Cumulative unpaid dividends converted into common shares, Convertible price per common share (in dollars per share) | $ 1,000 |
STOCK BASED COMPENSATION PLAN65
STOCK BASED COMPENSATION PLANS - Summary of stock based compensation plans (Details) | Jun. 30, 2015shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of shares authorized to purchase | 2,500,000 |
June 2013 | 2013 Stock Incentive Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of shares authorized to purchase | 500,000 |
June 2014 | 2014 Stock Option Incentive Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of shares authorized to purchase | 750,000 |
June 2015 | 2015 Stock Option Incentive Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of shares authorized to purchase | 1,250,000 |
STOCK BASED COMPENSATION PLAN66
STOCK BASED COMPENSATION PLANS - Summary of reserved shares of common stock for future issuance (Details 1) | 12 Months Ended |
Jun. 30, 2015shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Exercise of Common Stock Warrants | 4,309,000 |
Conversions of Preferred Stock and cumulative Preferred Stock dividends | 98,861 |
Total shares reserved for future issuance | 6,868,972 |
2013 Stock Incentive Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Issuance under Stock Incentive Plan | 321,111 |
2014 Stock Option Incentive Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Issuance under Stock Incentive Plan | 750,000 |
Issuance under 2015 Equity Incentive Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Issuance under Stock Incentive Plan | 1,250,000 |
Former Chief Executive Officer | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Issuance under Stock Incentive Plan | 140,000 |
STOCK BASED COMPENSATION PLAN67
STOCK BASED COMPENSATION PLANS - Summary of valuation assumption (Details 2) - Stock options | 12 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected volatility | 79.00% | |
Expected life | 7 years | 7 years |
Expected dividends | 0.00% | 0.00% |
Risk-free interest rate | 2.22% | |
Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected volatility | 78.00% | |
Risk-free interest rate | 1.59% | |
Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected volatility | 79.00% | |
Risk-free interest rate | 2.04% |
STOCK BASED COMPENSATION PLAN68
STOCK BASED COMPENSATION PLANS - Summary of options outstanding (Details 3) - Stock options - $ / shares | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Shares | |||
Options outstanding, beginning of period | 120,000 | 45,333 | |
Granted | 438,888 | 120,000 | |
Forfeited | (20,000) | ||
Expired | (45,333) | ||
Exercised | |||
Options outstanding, end of period | 538,888 | 120,000 | |
Weighted-Average Exercise Price | |||
Options outstanding, beginning of period | $ 2.05 | $ 7.53 | |
Granted | 1.82 | $ 2.05 | |
Forfeited | $ 2.05 | ||
Expired | $ 7.53 | ||
Exercised | |||
Options outstanding, end of period | $ 1.86 | $ 2.05 | |
Weighted Average Grant Date Fair Value | |||
Options outstanding, beginning of period | 1.49 | $ 5.34 | |
Granted | 1.30 | $ 1.49 | |
Forfeited | $ 1.49 | ||
Expired | $ 5.34 | ||
Exercised | |||
Options outstanding, end of period | $ 1.33 | $ 1.49 |
STOCK BASED COMPENSATION PLAN69
STOCK BASED COMPENSATION PLANS - Range of Exercise Prices (Details 4) - Stock options - $ / shares | 12 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2012 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Options Outstanding | 538,888 | 120,000 | 45,333 | |
Options Outstanding, Remaining Contractual Life | 6 years 2 months 16 days | 6 years 11 months 19 days | ||
Options Exercisable | 33,335 | |||
Options Exercisable, Remaining Contractual Life | 5 years 11 months 19 days | |||
Options Exercisable, Weighted Average Exercise Price | $ 2.05 | |||
Range of Exercise Prices $1.62 to $1.68 | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Options Outstanding | 75,000 | |||
Options Outstanding, Remaining Contractual Life | 6 years 6 months 4 days | |||
Options Exercisable | ||||
Range of Exercise Prices $1.62 to $1.68 | Minimum | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Range of Exercise Prices | $ 1.62 | |||
Range of Exercise Prices $1.62 to $1.68 | Maximum | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Range of Exercise Prices | 1.68 | |||
Range of Exercise Prices $1.78 | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Range of Exercise Prices | $ 1.78 | |||
Options Outstanding | 328,888 | |||
Options Outstanding, Remaining Contractual Life | 6 years 1 month 28 days | |||
Options Exercisable | ||||
Range of Exercise Prices $2.05 | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Range of Exercise Prices | $ 2.05 | |||
Options Outstanding | 100,000 | |||
Options Outstanding, Remaining Contractual Life | 5 years 11 months 19 days | |||
Options Exercisable | 33,335 | |||
Options Exercisable, Remaining Contractual Life | 5 years 11 months 19 days | |||
Options Exercisable, Weighted Average Exercise Price | $ 2.05 | |||
Range of Exercise Prices $2.09 | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Range of Exercise Prices | $ 2.09 | |||
Options Outstanding | 10,000 | |||
Options Outstanding, Remaining Contractual Life | 6 years 6 months 29 days | |||
Options Exercisable | ||||
Range of Exercise Prices $2.75 | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Range of Exercise Prices | $ 2.75 | |||
Options Outstanding | 25,000 | |||
Options Outstanding, Remaining Contractual Life | 6 years 9 months 7 days | |||
Options Exercisable |
STOCK BASED COMPENSATION PLAN70
STOCK BASED COMPENSATION PLANS - Information about unvested options (Details 5) - Stock options - $ / shares | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Shares | |||
Unvested options, beginning of period | 120,000 | ||
Granted | 438,888 | 120,000 | |
Vested | (33,335) | ||
Forfeited | (20,000) | ||
Unvested options, end of period | 505,553 | 120,000 | |
Weighted Average Grant Date Fair Value | |||
Unvested options, beginning of period | $ 1.49 | ||
Granted | 1.30 | $ 1.49 | |
Vested | 1.49 | ||
Forfeited | 1.49 | ||
Unvested options, end of period | $ 1.32 | $ 1.49 |
STOCK BASED COMPENSATION PLAN71
STOCK BASED COMPENSATION PLANS - Options outstanding and exercisable (Details 6) - Stock options - USD ($) | 12 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2012 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number, Options Outstanding | 538,888 | 120,000 | 45,333 | |
Number, Exercisable Options | 33,335 | |||
Weighted average exercise price, Options Outstanding | $ 1.86 | $ 2.05 | $ 7.53 | |
Weighted average exercise price, Exercisable Options | $ 2.05 | |||
Aggregate intrinsic value, Options Outstanding | $ 451,177 | $ 7,200 | ||
Aggregate intrinsic value, Exercisable Options | $ 21,668 | |||
Weighted average contractual term, Options Outstanding | 6 years 2 months 16 days | 6 years 11 months 19 days | ||
Weighted average contractual term, Exercisable Options | 5 years 11 months 19 days | |||
Share price of option outstanding and exercisable as of June 30 | $ 2.70 | $ 2.11 | $ 1.74 |
STOCK BASED COMPENSATION PLAN72
STOCK BASED COMPENSATION PLANS - Company nonvested common shares (Details 7) - $ / shares | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Shares | |||
Nonvested at June 30 | 43,811 | 97,146 | 172,003 |
Granted | 155,927 | 10,000 | 156,429 |
Vested | (181,134) | (55,001) | (204,587) |
Forfeited, Director changes | (3,334) | ||
Forfeited, Employee shares not earned | (5,000) | (26,699) | |
Nonvested at June 30 | 18,604 | 43,811 | 97,146 |
Weighted-Average Grant-Date Fair Value | |||
Nonvested at June 30 | $ 1.59 | $ 1.52 | $ 1.82 |
Granted | 2 | 2.17 | 1.45 |
Vested | 1.89 | 1.62 | 1.72 |
Forfeited, Director changes | 0.94 | ||
Forfeited, Employee shares not earned | 1.52 | 1.52 | |
Nonvested at June 30 | $ 1.88 | $ 1.59 | $ 1.52 |
STOCK BASED COMPENSATION PLAN73
STOCK BASED COMPENSATION PLANS (Detail Textuals) - USD ($) | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock based compensation | $ 715,762 | $ 529,041 | $ 502,907 |
Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock based compensation | 370,435 | ||
Unrecognized compensation related to stock option grants | $ 297,202 |
WARRANTS - Exercise prices and
WARRANTS - Exercise prices and expiration dates for warrants outstanding (Details) - $ / shares | 12 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2012 | |
Class of Warrant or Right [Line Items] | ||||
Exercise Price Per Share | $ 2.6058 | $ 2.6058 | ||
Warrants | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants Outstanding | 4,309,000 | 4,309,000 | 7,361,708 | 8,045,619 |
Warrants | September 18, 2016 | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants Outstanding | 4,264,000 | |||
Exercise Price Per Share | $ 2.61 | |||
Expiration Date | Sep. 18, 2016 | |||
Warrants | December 31, 2017 | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants Outstanding | 45,000 | |||
Exercise Price Per Share | $ 2.10 | |||
Expiration Date | Dec. 31, 2017 |
WARRANTS - Summary of warrant a
WARRANTS - Summary of warrant activity (Details 1) - Warrants - shares | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Class Of Warrant Or Right [Roll Forward] | |||
Outstanding at June 30 | 4,309,000 | 7,361,708 | 8,045,619 |
Issued | 45,000 | ||
Exercised | (2,090,226) | (399,597) | |
Expired | (962,482) | (329,314) | |
Outstanding at June 30 | 4,309,000 | 4,309,000 | 7,361,708 |
WARRANTS (Detail Textuals)
WARRANTS (Detail Textuals) - USD ($) | 12 Months Ended | |||||||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 | Jul. 07, 2013 | May. 31, 2013 | May. 12, 2013 | May. 12, 2010 | |
Class of Warrant or Right [Line Items] | ||||||||
Exercise price per share | $ 2.6058 | $ 2.6058 | ||||||
Number of warrants exercised | 2,090,226 | 382,503 | ||||||
Cashless exercise of warrants in issuance of common stock | 36,186 | |||||||
Warrants issued in conjunction with Line of Credit Amendment | $ 55,962 | |||||||
Non-cash interest and amortization of debt discount | $ 2,095 | 53,867 | ||||||
Common Stock | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Number of shares of common stock remain unexercised | 1,258 | |||||||
Warrants issued in conjunction with Line of Credit Amendment | $ 55,962 | |||||||
Placement Agent | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Number of common stock called by warrants | 13,216 | |||||||
Exercise price per share | $ 1.13 | |||||||
Placement Agent | Common Stock | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Proceeds from issuance of common stock | $ 14,934 | |||||||
Number of common stock issued for cashless exercise of warrants | 17,094 | |||||||
2010 Public Offering | Common Stock | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Number of shares of common stock remain unexercised | 58,527 | |||||||
Warrants | Loan and Security Agreement | Commercial Bank | Line of Credit | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Number of common stock called by warrants | 45,000 | |||||||
Exercise price per share | $ 2.10 | |||||||
Warrants issued in conjunction with Line of Credit Amendment | $ 55,962 | |||||||
Non-cash interest and amortization of debt discount | $ 0 | $ 2,095 | $ 53,867 | |||||
Warrants | Placement Agent | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Cashless exercise of warrants in issuance of common stock | 36,186 | |||||||
Warrants | 2010 Public Offering | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Number of common stock called by warrants | 2,753,454 | |||||||
Exercise price per share | $ 1.13 | $ 1.13 | $ 1.13 | |||||
Number of warrants exercised | 2,090,226 | 369,287 | ||||||
Proceeds from issuance of common stock | $ 2,361,956 | $ 417,294 | ||||||
Warrants | 2010 Public Offering | Placement Agent | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Number of common stock called by warrants | 15,717 | 165,207 | ||||||
Exercise price per share | $ 1.13 | $ 1.13 |
WARRANTS (Detail Textuals 1)
WARRANTS (Detail Textuals 1) - USD ($) | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | Mar. 17, 2011 |
Class of Warrant or Right [Line Items] | ||||
Exercise price per share | $ 2.6058 | $ 2.6058 | ||
Warrant liabilities | $ 978,353 | $ 585,209 | $ 650,638 | |
Placement Agent | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants issued | 13,216 | |||
Exercise price per share | $ 1.13 | |||
Warrants | Private Placement Offering 2011 | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants issued | 3,900,000 | |||
Exercise price per share | $ 2.6058 | |||
Number of warrants exercisable | 4,264,000 | |||
Warrants | Private Placement Offering 2011 | Placement Agent | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants issued | 364,000 | |||
Exercise price per share | $ 2.6058 |
RETIREMENT PLAN (Detail Textual
RETIREMENT PLAN (Detail Textuals) - USD ($) | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Compensation and Retirement Disclosure [Abstract] | |||
Maximum percent of voluntary contribution | 100.00% | ||
Description of safe harbor matching contributions plan | Company elected and made a safe harbor matching contributions of 100% of the participant's first 3% and 50% of the next 2% of compensation deferred into the Retirement Plan | ||
Percentage of safe harbor matching contributions for first 3% employee compensation | 100.00% | 100.00% | 100.00% |
Percentage of employee compensation eligible for 100% safe harbor matching contributions | 3.00% | 3.00% | 3.00% |
Percentage of safe harbor matching contributions for next 2% employee compensation | 50.00% | 50.00% | 50.00% |
Percentage of employee compensation eligible for 50% of next safe harbor matching contributions | 2.00% | 2.00% | 2.00% |
Company's safe harbor contribution | $ 192,000 | $ 168,000 | $ 176,000 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Summary of sale of rental equipment (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Rental equipment sold, cost | $ 3,873,275 | $ 1,918,920 |
Rental equipment sold, accumulated depreciation upon sale | (331,069) | (76,032) |
Rental equipment sold, net book value | 3,542,206 | 1,842,888 |
Proceeds from sale | 4,993,879 | 2,995,095 |
Gain on sale of rental equipment | $ 1,451,673 | $ 1,152,207 |
COMMITMENTS AND CONTINGENCIES80
COMMITMENTS AND CONTINGENCIES - Summary of recognized gains (Details 1) - USD ($) | 12 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Beginning balance | $ 1,142,685 | |
Gain on sale of rental equipment | 1,451,673 | $ 1,152,207 |
Recognition of deferred gain | (833,619) | (9,522) |
Ending balance | 1,760,739 | 1,142,685 |
Less current portion | 860,391 | 380,895 |
Non-current portion of deferred gain | $ 900,348 | $ 761,790 |
COMMITMENTS AND CONTINGENCIES81
COMMITMENTS AND CONTINGENCIES - Future minimum lease payments (Details 2) | Jun. 30, 2015USD ($) |
Operating Leases from Sale Leaseback | |
2016 - Sale Leaseback | $ 2,641,155 |
2017 - Sale Leaseback | 2,641,155 |
2018 - Sale Leaseback | $ 137,731 |
2019 - Sale Leaseback | |
Total minimum lease payments - Sale Leaseback | $ 5,420,041 |
Other Operating Leases | |
2016 - Other Operating Leases | 361,927 |
2017 - Other Operating Leases | $ 810 |
2018 - Other Operating Leases | |
2019 - Other Operating Leases | |
Total minimum lease payments - Other Operating Leases | $ 362,737 |
Total Operating Leases | |
2016 - Operating Leases | 3,003,082 |
2017 - Operating Leases | 2,641,965 |
2018 - Operating Leases | $ 137,731 |
2019 - Operating Leases | |
Total minimum lease payments - Operating Leases | $ 5,782,778 |
Capital Leases | |
2016 - Capital Leases | 157,304 |
2017 - Capital Leases | 131,585 |
2018 - Capital Leases | 70,416 |
2019 - Capital Leases | 23,361 |
Total minimum lease payments - Capital Leases | 382,666 |
Less amount representing interest | 45,069 |
Present value of net minimum lease payments | 337,597 |
Less current obligations under capital leases | 131,583 |
Obligations under capital leases, less current portion | $ 206,014 |
COMMITMENTS AND CONTINGENCIES82
COMMITMENTS AND CONTINGENCIES (Detail Textuals) - Third-party finance company | 1 Months Ended |
Jun. 30, 2014Lease | |
Commitment And Contingency [Line Items] | |
Number of sale leaseback agreements | 6 |
Agreement lease term | 36 months |
COMMITMENTS AND CONTINGENCIES83
COMMITMENTS AND CONTINGENCIES (Detail Textuals 1) - USD ($) | 1 Months Ended | 12 Months Ended | ||||
Dec. 30, 2014 | Nov. 30, 2012 | Nov. 30, 2010 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Commitment And Contingency [Line Items] | ||||||
Rent expense under operating leases | $ 354,000 | $ 372,000 | $ 432,000 | |||
Customer agreement | ||||||
Commitment And Contingency [Line Items] | ||||||
Recoup credit card chargebacks due | 680,000 | |||||
Obligations With Customer Billing Dispute | ||||||
Commitment And Contingency [Line Items] | ||||||
Payment of billing dispute settlement | $ 690,000 | |||||
Obligations With Customer Billing Dispute | Cost Of Services | ||||||
Commitment And Contingency [Line Items] | ||||||
Payment of billing dispute settlement | $ 410,000 | $ 280,000 | ||||
Malvern office facilities | Property subject to operating lease | ||||||
Commitment And Contingency [Line Items] | ||||||
Operating leases, rent expense, minimum rentals | $ 29,000 | |||||
Maximum monthly rental lease | 32,000 | |||||
Rent expense under operating leases | 195,000 | |||||
Straight-lined rent expense | $ 25,000 | |||||
Malvern product warehousing facilities | Product warehousing shipping and customer support | ||||||
Commitment And Contingency [Line Items] | ||||||
Operating leases, rent expense, minimum rentals | $ 4,406 | |||||
Maximum monthly rental lease | 4,678 | |||||
Straight-lined rent expense | $ 4,300 |
VALUATION AND QUALIFYING ACCO84
VALUATION AND QUALIFYING ACCOUNTS (Details) - USD ($) | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
ACCOUNTS RECEIVABLE | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at beginning of period | $ 63,000 | $ 18,000 | $ 25,000 |
Additions charged to earnings | 594,000 | 94,000 | 69,000 |
Deductions uncollectible receivables written off, net of recoveries | 163,000 | 49,000 | 76,000 |
Balance at end of period | 494,000 | 63,000 | 18,000 |
INVENTORY | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at beginning of period | 765,000 | 727,000 | 712,000 |
Additions charged to earnings | 551,000 | 164,000 | 135,000 |
Deductions uncollectible receivables written off, net of recoveries | 372,000 | 126,000 | 120,000 |
Balance at end of period | $ 944,000 | $ 765,000 | $ 727,000 |