Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Sep. 30, 2014 | Nov. 12, 2014 | |
Document and Entity Information [Abstract] | ' | ' |
Entity Registrant Name | 'INTERNET AMERICA INC | ' |
Entity Central Index Key | '0001001279 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Sep-14 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--06-30 | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Common Stock, Shares Outstanding | ' | 16,747,062 |
Document Fiscal Year Focus | '2015 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
CONDENSED_CONSOLIDATED_BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) | Sep. 30, 2014 | Jun. 30, 2014 |
CURRENT ASSETS: | ' | ' |
Cash and cash equivalents | $3,437,001 | $3,107,142 |
Accounts receivable, net of allowance for uncollectible accounts of $11,333 and $10,496 as of September 30, 2014 and June 30, 2014, respectively | 174,785 | 215,805 |
Inventory | 413,651 | 354,080 |
Prepaid expenses and other current assets | 66,187 | 94,001 |
Deferred tax asset | 422,000 | 422,000 |
Total current assets | 4,513,624 | 4,193,028 |
Property and equipment - net | 1,560,289 | 1,585,546 |
Goodwill | 1,968,127 | 1,968,127 |
Subscriber acquisition costs - net | 591,540 | 691,193 |
Deferred tax asset | 8,126,733 | 8,178,000 |
Other assets | 51,176 | 41,181 |
TOTAL ASSETS | 16,811,489 | 16,657,075 |
CURRENT LIABILITIES: | ' | ' |
Accounts payable | 219,928 | 158,059 |
Accrued liabilities | 720,763 | 597,529 |
Deferred revenue | 786,623 | 798,320 |
Current portion of long-term debt and capital lease | 131,154 | 187,029 |
Total current liabilities | 1,858,468 | 1,740,937 |
Other liability, net | 169,986 | 193,433 |
Long-term debt and capital lease, net of current portion | 101,773 | 110,647 |
Total liabilities | 2,130,227 | 2,045,017 |
COMMITMENTS AND CONTINGENCIES | ' | ' |
SHAREHOLDERS' EQUITY: | ' | ' |
Preferred stock, $0.01 par value: 5,000,000 shares authorized, 2,718,428 issued and outstanding as of September 30, 2014 and June 30, 2014. | 27,185 | 27,185 |
Common stock, $0.01 par value: 40,000,000 shares authorized, 16,747,062 outstanding as of September 30, 2014 and June 30, 2014. | 167,471 | 167,471 |
Additional paid-in capital | 63,070,857 | 63,069,658 |
Accumulated deficit | -48,584,251 | -48,652,256 |
Total shareholders' equity | 14,681,262 | 14,612,058 |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $16,811,489 | $16,657,075 |
CONDENSED_CONSOLIDATED_BALANCE1
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Sep. 30, 2014 | Jun. 30, 2014 |
CONSOLIDATED BALANCE SHEETS [Abstract] | ' | ' |
Allowance for uncollectible accounts | $11,333 | $10,496 |
Preferred stock, par value | $0.01 | $0.01 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, issued | 2,718,428 | 2,718,428 |
Preferred stock, outstanding | 2,718,428 | 2,718,428 |
Common stock, par value | $0.01 | $0.01 |
Common stock, shares authorized | 40,000,000 | 40,000,000 |
Common stock, issued | 16,747,062 | 16,747,062 |
Common stock, outstanding | 16,747,062 | 16,747,062 |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (USD $) | 3 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
REVENUES: | ' | ' |
Internet services | $2,047,822 | $1,967,096 |
TOTAL REVENUES | 2,047,822 | 1,967,096 |
OPERATING EXPENSES: | ' | ' |
Connectivity and operations | 1,108,075 | 978,281 |
Sales and marketing | 80,555 | 100,225 |
General and administrative | 514,596 | 421,638 |
Depreciation and amortization | 209,007 | 179,093 |
TOTAL OPERATING EXPENSES | 1,912,233 | 1,679,237 |
INCOME FROM OPERATIONS | 135,589 | 287,859 |
OTHER INCOME (EXPENSE) | ' | ' |
Interest income | 1,783 | 2,445 |
Interest expense | -4,050 | -3,914 |
OTHER EXPENSE, net | -2,267 | -1,469 |
INCOME BEFORE INCOME TAX EXPENSE | 133,322 | 286,390 |
Income tax expense | 65,317 | 12,600 |
NET INCOME | $68,005 | $273,790 |
NET INCOME PER COMMON SHARE: | ' | ' |
BASIC | $0 | $0.02 |
DILUTED | $0 | $0.01 |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | ' | ' |
BASIC | 16,747,062 | 16,729,562 |
DILUTED | 20,024,300 | 19,840,970 |
CONDENSED_CONSOLIDATED_STATEME1
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 3 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
OPERATING ACTIVITIES: | ' | ' |
Net income | $68,005 | $273,790 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Depreciation and amortization | 209,007 | 179,093 |
Loss from sale or disposal of assets | ' | 4,502 |
Provision for bad debt | 34 | 8 |
Stock based compensation | 1,199 | 1,508 |
Deferred tax expense | 51,267 | ' |
Changes in operating assets and liabilities: | ' | ' |
Accounts receivable | 40,986 | 4,342 |
Inventory | -59,571 | -66,300 |
Prepaid expenses and other current assets | 11,557 | -10,753 |
Other assets | ' | 22,989 |
Accounts payable and accrued liabilities | 185,103 | 131,923 |
Other long-term assets | -9,995 | ' |
Deferred revenue | -11,697 | -22,231 |
Net cash provided by operating activities | 485,895 | 518,871 |
INVESTING ACTIVITIES: | ' | ' |
Purchases of property and equipment | -91,288 | -107,172 |
Net cash used in investing activities | -91,288 | -107,172 |
FINANCING ACTIVITIES: | ' | ' |
Principal payments of long-term debt | -56,332 | -56,771 |
Principal payments of capital lease | -8,416 | ' |
Net cash used in financing activities | -64,748 | -56,771 |
NET INCREASE IN CASH AND CASH EQUIVALENTS | 329,859 | 354,928 |
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | 3,107,142 | 2,295,190 |
CASH AND CASH EQUIVALENTS, END OF PERIOD | 3,437,001 | 2,650,118 |
SUPPLEMENTAL INFORMATION: | ' | ' |
Cash paid for interest | 3,805 | 4,058 |
NON-CASH INVESTING AND FINANCING ACTIVITIES: | ' | ' |
Disposal of fully depreciated assets | ' | 7,652 |
Assets acquired through capital lease | 16,475 | ' |
Discount of accrued purchase consideration | ($24,385) | ' |
Basis_of_Presentation
Basis of Presentation | 3 Months Ended | |
Sep. 30, 2014 | ||
Basis of Presentation [Abstract] | ' | |
Basis of Presentation | ' | |
1 | Basis of Presentation | |
Certain information and footnote disclosures normally included in consolidated financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted pursuant to Article 8 of Regulation S-X of the Securities and Exchange Commission. The accompanying unaudited condensed consolidated financial statements reflect, in the opinion of management, all adjustments necessary to achieve a fair presentation of the consolidated financial position and results of operations of Internet America, Inc. (the “Company” or “Internet America” or "we") for the interim periods presented. All such adjustments are of a normal and recurring nature. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in the Company's Annual Report on Form 10-K for its fiscal year ended June 30, 2014. |
Principles_of_Consolidation
Principles of Consolidation | 3 Months Ended | |
Sep. 30, 2014 | ||
Principles of Consolidation [Abstract] | ' | |
Principles of Consolidation | ' | |
2 | Principles of Consolidation | |
The condensed consolidated financial statements include the accounts of the Company and its subsidiary, TeleShare Communication Services, Inc. All material intercompany accounts and transactions have been eliminated. |
Basic_and_Diluted_Net_Income_P
Basic and Diluted Net Income Per Share | 3 Months Ended | |
Sep. 30, 2014 | ||
Basic and Diluted Net Income Per Share [Abstract] | ' | |
Basic and Diluted Net Income Per Share | ' | |
3 | Basic and Diluted Net Income Per Share | |
For the three months ended September 30, 2014 and 2013, common stock equivalent shares totaling 2,718,428 have been added to the weighted average common shares outstanding, assuming the shares of preferred stock were converted into shares of common stock as of the first day of each respective period, for the purpose of computing diluted earnings per share ("EPS"). For the three months ended September 30, 2014 and 2013, additional common stock equivalent shares totaling 558,810 and 392,980, respectively, were included in the calculation of diluted EPS. These additional shares are attributable to outstanding in-the-money stock options and warrants. Options to purchase 20,000 shares of the Company's common stock were excluded in the computation of diluted EPS for the three months ended September 30, 2014 as the effect of these options were anti-dilutive. Options to purchase 471,526 shares of the Company's common stock were excluded in the computation of diluted EPS for the three months ended September 30, 2013 as the effect of these options were anti-dilutive. All outstanding warrants were included in the computation of diluted EPS for the three months ended September 30, 2014 and 2013. All of these warrants expired in September 2014. |
Use_of_Estimates
Use of Estimates | 3 Months Ended | |
Sep. 30, 2014 | ||
Use of Estimates [Abstract] | ' | |
Use of Estimates | ' | |
4 | Use of Estimates | |
The preparation of condensed consolidated financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ significantly from these estimates. |
Acquisition_of_Subscribers
Acquisition of Subscribers | 3 Months Ended | |
Sep. 30, 2014 | ||
Acquisition of Subscribers [Abstract] | ' | |
Acquisition of Subscribers | ' | |
5 | Acquisition of Subscribers | |
During fiscal 2014, the Company completed one acquisition of subscribers and tangible assets to grow the Company's subscriber base. The Company has not made any acquisitions through the first quarter of fiscal 2015. These acquisitions were accounted for using the purchase method. The Company immediately began integrating the acquired assets of each acquisition into the Company's existing operations and continues to operate these assets within a single business segment. The amortization period of the intangible assets acquired in each acquisition is four years, which is management's best estimate of the average economic life of a subscriber based on historical experience. | ||
On November 1, 2013, the Company completed an acquisition of the subscribers associated with the wireless ISP operations of UpperSpace Corporation ("UpperSpace") conducted in and around northeast Oklahoma for an estimated total purchase consideration of $580,300, payable as follows: (i) a $193,433 cash payment, inclusive of $61,325 retained by the seller representing deferred revenues, made at closing, (ii) an estimated $193,433 cash payment to be made on the twelve month anniversary of the closing (which estimated payment is included in accrued liabilities) and (iii) an estimated $193,433 cash payment to be made on the thirty-six month anniversary of the closing (which payment is included in other long term liabilities, net of a discount of $24,385 recorded in the quarter ended September 30, 2014). The total estimated purchase consideration of $580,300 is allocated as follows: $530,486 to subscriber acquisition costs, $42,132 to fixed assets and $7,681 to other intangible assets. The final purchase price will be determined twelve months from the closing date at which time a note payable will be issued for the remaining purchase price owed. |
Goodwill_and_Subscriber_Acquis
Goodwill and Subscriber Acquisition Costs | 3 Months Ended | |
Sep. 30, 2014 | ||
Goodwill and Subscriber Acquisition Costs [Abstract] | ' | |
Goodwill and Subscriber Acquisition Costs | ' | |
6 | Goodwill and Subscriber Acquisition Costs | |
Pursuant to Financial Accounting Standards Board (“FASB”) guidance on goodwill and other intangibles, the Company performs a qualitative evaluation of goodwill annually or more frequently when indicators of impairment exist, and if that evaluation indicates impairment has occurred, the following two-step process is applied. The first step is used to identify a potential impairment by comparing the fair value of a reporting unit with its net book value (or carrying amount) including goodwill. If the fair market value exceeds the carrying amount, goodwill of the reporting unit is not considered impaired and the second step of the impairment test is unnecessary. If the carrying amount of the reporting unit exceeds its fair value, the second step of the goodwill impairment test compares the fair value of the reporting unit's goodwill with the carrying amount of that goodwill. If the carrying amount exceeds the implied fair value, an impairment loss is recognized in an amount equal to that excess. The Company concluded that no impairment of goodwill occurred during the three months ended September 30, 2014. | ||
The Company amortizes customer acquisition costs over the estimated life of the acquired customers. The weighted average amortization period for subscriber acquisition costs was 48 months for both dial-up and wireless broadband Internet customers during the three months ended September 30, 2014 and 2013. As of September 30, 2014, unrecognized amortization expense for the remainder of fiscal year ended June 30, 2015 is expected to be $202,000 and unrecognized amortization expense for fiscal years ended June 30, 2016, 2017 and 2018 is expected to be $208,000, $140,000 and $42,000, respectively. |
Income_Taxes
Income Taxes | 3 Months Ended | |
Sep. 30, 2014 | ||
Income Taxes [Abstract] | ' | |
Income Taxes | ' | |
7 | Income Taxes | |
During the three months ended September 30, 2014 and 2013, the Company generated income before income tax expense of $133,322 and $286,390, respectively, and recognized Texas franchise tax expense of $14,050 and $12,600, respectively. The provision for federal income taxes recorded for the three months ended September 30, 2014 and 2013 was $51,267 and zero, respectively. The effective tax rate for the three months ended September 30, 2014 and 2013 was 49.0% and 4.4%, respectively. At September 30, 2014, the differences from the statutory rate of 34.0% include an increase of 9.0% for non-deductible expenses and 6.0% for state tax expense, net of federal benefit. At September 30, 2013, the differences from the statutory rate of 34.0% include a decrease of 22.0% for the reduction in the valuation allowance, 10.5% for non-deductible expenses, offset by an increase of 2.9% for state tax expense, net of federal benefit. | ||
The Company has provided a valuation allowance totaling $3,503,000 and $3,452,000 of net deferred tax assets at September 30, 2014 and June 30, 2014, respectively, as it is deemed more likely than not that these assets will not be realized due to lack of positive evidence to suggest otherwise. Future adjustments to the valuation allowance associated with a change in management's determination of the Company's ability to realize these deferred tax assets will result in an adjustment to income tax expense (benefit) in future periods when those determinations are made. Management will continue to assess the realizability of the deferred tax assets at each interim and annual balance sheet date based on actual and forecasted operating results. | ||
At September 30, 2014, the Company had net operating loss carry forwards of approximately $36 million for federal income tax purposes. These net operating loss carryforwards may be carried forward in varying amounts and expire beginning in fiscal year 2019 continuing through fiscal year 2033 and may be limited in their use due to significant changes in the Company's ownership. | ||
The preparation of various tax returns requires the use of estimates for federal and state income tax purposes. Those estimates may be subject to review by respective taxing authorities. A revision, if any, to an estimate may result in assessment of additional taxes, penalties and interest. Tax years 2009 through 2012 remain subject to examination by various federal and state tax jurisdictions. The Company performed an assessment of its various income tax positions for all periods subject to examination and concluded that no accrual of uncertain tax positions was necessary as of September 30, 2014 and June 30, 2014. The Company will account for interest and penalties related to uncertain tax positions in the current period consolidated statement of operations, as necessary. |
Accrued_Liabilities
Accrued Liabilities | 3 Months Ended | ||||||||||||
Sep. 30, 2014 | |||||||||||||
Accrued Liabilities [Abstract] | ' | ||||||||||||
Accrued Liabilities | ' | ||||||||||||
8 | Accrued Liabilities | ||||||||||||
As of September 30, 2014 and June 30, 2014, accrued liabilities consisted of the following: | |||||||||||||
September 30, | June 30, | ||||||||||||
2014 | 2014 | ||||||||||||
Purchase consideration for acquisition of subscribers | $ | 193,433 | $ | 193,433 | |||||||||
Property, franchise and sales tax expense | 197,876 | 180,992 | |||||||||||
Employee wages and benefits | 195,360 | 117,229 | |||||||||||
Professional fees | 79,457 | 56,000 | |||||||||||
Deferred rent expense | 48,328 | 48,688 | |||||||||||
Other | 6,309 | 1,187 | |||||||||||
Total accrued liabilities | $ | 720,763 | $ | 597,529 | |||||||||
Acquisition_Credit_Facility_an
Acquisition Credit Facility and Long-Term Debt | 3 Months Ended | ||||||||||||
Sep. 30, 2014 | |||||||||||||
Acquisition Credit Facility and Long-Term Debt [Abstract] | ' | ||||||||||||
Acquisition Credit Facility and Long-Term Debt | ' | ||||||||||||
9 | Acquisition Credit Facility and Long-Term Debt | ||||||||||||
On October 28, 2013, the Company entered into a loan agreement and other related agreements and documents with Frost Bank (the "Bank") creating a non-revolving acquisition credit facility (the “Acquisition Facility”) designed to provide the Company with an additional source of funding for the potential acquisition of subscribers from internet companies (each, an "Acquisition"). | |||||||||||||
The amount that may be borrowed under the Acquisition Facility is $2,000,000 (the “Loan Cap”). For each specific Acquisition, the maximum amount that can be borrowed under the Acquisition Facility, subject to the Loan Cap, is (i) 55% of the cost of such Acquisition in the case of an Acquisition that is partially paid for using seller financing that has a maturity of less than three years and (ii) 65% of the cost of such Acquisition in the case of an Acquisition that is partially paid for using seller financing that has a maturity of three years or more. The Acquisition Facility is currently set to terminate on April 25, 2015. Through the date of this report, there has been no borrowing under the Acquisition Facility. | |||||||||||||
Each advance made by the Bank under the Acquisition Facility will be evidenced by the Company's execution and delivery to the Bank of a separate promissory note (an “Acquisition Note”) that will provide for a maturity of not more than three years and equal monthly principal reduction payments, plus interest, to be made over the term of the Acquisition Note. Each Acquisition Note will bear interest at a fixed rate equal to the then current index rate for one and one-half (1.5) year to two (2) year loans established by the Federal Home Loan Bank of Dallas, plus 4%. | |||||||||||||
There are two financial covenants under the Acquisition Facility. The first covenant requires the Company to maintain a debt (excluding subordinated debt) to tangible net worth ratio of less than or equal to 2.5 to 1.0. The second covenant requires the Company to maintain a cash flow to debt service ratio of greater than or equal to 2.0 to 1.0, to be calculated on a rolling four-quarter basis. Both covenants are to be tested as of the end of each fiscal quarter. At September 30, 2014, the Company is in compliance with these covenants. | |||||||||||||
Indebtedness under the Acquisition Facility will be secured by a perfected, continuing security interest in favor of Frost Bank in all of the Company's assets. Advances will be conditioned on, among other things, all representations and warranties contained in the loan documents being true and correct as of the date of the advance request and there being no default under the Acquisition Facility at the time of, or as a result of, the advance request. With each advance, the Company will be charged a loan processing fee equal to the greater of $250 and one-tenth of one percent (0.10%) of the amount of the advance. | |||||||||||||
As of September 30, 2014 and June 30, 2014, long term debt consisted of the following: | |||||||||||||
September 30, | June 30, | ||||||||||||
2014 | 2014 | ||||||||||||
Note payable due February 15, 2015, payable in monthly payments of $4,346 with fixed interest at 4.5% | $ | 21,489 | $ | 34,190 | |||||||||
Note payable due February 15, 2015, payable in monthly payments of $11,189 with interest imputed at 3.25% (net of unamortized discount of $452 and $1,081, respectively) | 55,494 | 88,432 | |||||||||||
Note payable due November 1, 2014, payable in monthly installments of $1,674 with interest imputed at 8% (net of unamortized discount of $33 and $165, respectively) | 3,315 | 8,206 | |||||||||||
Note payable due May 1, 2015, payable in monthly installments of $2,067 with interest imputed at 8% (net of unamortized discount of $485 and $884, respectively) | 16,048 | 21,850 | |||||||||||
Capital lease obligation due May 31, 2018, payable in monthly installments of $3,390 with interest imputed at 4.5% (net of unamortized discount of $12,586 and $13,730, respectively) | 136,581 | 144,998 | |||||||||||
Total | 232,927 | 297,676 | |||||||||||
Less current portion | (131,154 | ) | (187,029 | ) | |||||||||
Total long-term debt, less current portion | $ | 101,773 | $ | 110,647 |
Commitments_and_Contingencies
Commitments and Contingencies | 3 Months Ended | |
Sep. 30, 2014 | ||
Commitments and Contingencies [Abstract] | ' | |
Commitments and Contingencies | ' | |
10 | Commitments and Contingencies | |
We are involved from time to time in disputes and legal proceedings. At this time, management believes that such matters, individually and in the aggregate, are not material to our financial condition, results of operations and cash flows. |
Stock_Options_and_Warrants
Stock Options and Warrants | 3 Months Ended | |||||||||||
Sep. 30, 2014 | ||||||||||||
Stock Options and Warrants [Abstract] | ' | |||||||||||
Stock Options and Warrants | ' | |||||||||||
11 | Stock Options and Warrants | |||||||||||
As of September 30, 2014, options consisted of the following: | ||||||||||||
30-Sep-14 | ||||||||||||
Shares | Weighted Average | |||||||||||
Exercise | ||||||||||||
Price | ||||||||||||
Outstanding at June 30, 2014 | 1,226,526 | $ | 0.4 | |||||||||
Granted | 20,000 | 0.66 | ||||||||||
Forfeited | (105,000 | ) | 0.4 | |||||||||
Outstanding at September 30, 2014 | 1,141,526 | 0.4 | ||||||||||
Options exercisable at September 30, 2014 | 529,026 | 0.48 | ||||||||||
As of September 30, 2014, 1,141,526 stock options were outstanding and 840,974 stock options were available for future issuance under the Company's 2007 Stock Option Plan. During the three months ended September 30, 2014, the Company granted 20,000 stock options. The stock options granted during the three months ended September 30, 2014 consisted of a single grant of an option to purchase 20,000 shares of the Company's common stock at an exercise price of $0.66 per share. The Company determined the total fair value of such option grant to be $4,599, or $0.23 per stock option. The option grant vests as follows: 25% of the option (covering 5,000 shares) vests on the grant date and the remaining portion of the option (covering 15,000 shares) will vest 5,000 shares each on July 8, 2015, 2016 and 2017. Stock based compensation expense of $1,199 and $1,508 was recognized during the three months ended September 30, 2014 and 2013, respectively, based on granted options. As of September 30, 2014, the total stock based compensation expense related to non-vested awards not yet recognized was $9,740. | ||||||||||||
During the quarter ended September 30, 2014, all of the Company's outstanding warrants (covering 394,922 shares) expired and at September 30, 2014 no warrants were issued or outstanding. |
Related_Party_Transactions
Related Party Transactions | 3 Months Ended | |
Sep. 30, 2014 | ||
Related Party Transactions [Abstract] | ' | |
Related Party Transactions | ' | |
12 | Related Parties | |
During the three months ended September 30, 2014 and 2013, a total of $7,375 and $11,703, respectively, was recorded as expense for non-employee directors serving on the Company's board of directors. |
Recent_Accounting_Pronouncemen
Recent Accounting Pronouncements | 3 Months Ended | |
Sep. 30, 2014 | ||
Recent Accounting Pronouncements [Abstract] | ' | |
Recent Accounting Pronouncements | ' | |
13 | Recent Accounting Pronouncements | |
The Company has reviewed recently issued accounting standards, none of which are expected to have a material impact on the Company's financial positions or results of operations. |
Accrued_Liabilities_Tables
Accrued Liabilities (Tables) | 3 Months Ended | ||||||||||||
Sep. 30, 2014 | |||||||||||||
Accrued Liabilities [Abstract] | ' | ||||||||||||
Schedule of accrued liabilities | ' | ||||||||||||
September 30, | June 30, | ||||||||||||
2014 | 2014 | ||||||||||||
Purchase consideration for acquisition of subscribers | $ | 193,433 | $ | 193,433 | |||||||||
Property, franchise and sales tax expense | 197,876 | 180,992 | |||||||||||
Employee wages and benefits | 195,360 | 117,229 | |||||||||||
Professional fees | 79,457 | 56,000 | |||||||||||
Deferred rent expense | 48,328 | 48,688 | |||||||||||
Other | 6,309 | 1,187 | |||||||||||
Total accrued liabilities | $ | 720,763 | $ | 597,529 |
Acquisition_Credit_Facility_an1
Acquisition Credit Facility and Long-Term Debt (Tables) | 3 Months Ended | ||||||||||||
Sep. 30, 2014 | |||||||||||||
Acquisition Credit Facility and Long-Term Debt [Abstract] | ' | ||||||||||||
Schedule of Long-Term Debt | ' | ||||||||||||
September 30, | June 30, | ||||||||||||
2014 | 2014 | ||||||||||||
Note payable due February 15, 2015, payable in monthly payments of $4,346 with fixed interest at 4.5% | $ | 21,489 | $ | 34,190 | |||||||||
Note payable due February 15, 2015, payable in monthly payments of $11,189 with interest imputed at 3.25% (net of unamortized discount of $452 and $1,081, respectively) | 55,494 | 88,432 | |||||||||||
Note payable due November 1, 2014, payable in monthly installments of $1,674 with interest imputed at 8% (net of unamortized discount of $33 and $165, respectively) | 3,315 | 8,206 | |||||||||||
Note payable due May 1, 2015, payable in monthly installments of $2,067 with interest imputed at 8% (net of unamortized discount of $485 and $884, respectively) | 16,048 | 21,850 | |||||||||||
Capital lease obligation due May 31, 2018, payable in monthly installments of $3,390 with interest imputed at 4.5% (net of unamortized discount of $12,586 and $13,730, respectively) | 136,581 | 144,998 | |||||||||||
Total | 232,927 | 297,676 | |||||||||||
Less current portion | (131,154 | ) | (187,029 | ) | |||||||||
Total long-term debt, less current portion | $ | 101,773 | $ | 110,647 |
Stock_Options_and_Warrants_Tab
Stock Options and Warrants (Tables) | 3 Months Ended | |||||||||||
Sep. 30, 2014 | ||||||||||||
Stock Options and Warrants [Abstract] | ' | |||||||||||
Schedule of Stock Options | ' | |||||||||||
30-Sep-14 | ||||||||||||
Shares | Weighted Average | |||||||||||
Exercise | ||||||||||||
Price | ||||||||||||
Outstanding at June 30, 2014 | 1,226,526 | $ | 0.4 | |||||||||
Granted | 20,000 | 0.66 | ||||||||||
Forfeited | (105,000 | ) | 0.4 | |||||||||
Outstanding at September 30, 2014 | 1,141,526 | 0.4 | ||||||||||
Options exercisable at September 30, 2014 | 529,026 | 0.48 |
Basic_and_Diluted_Net_Income_P1
Basic and Diluted Net Income Per Share (Details) | 3 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
Basic and Diluted Net Income Per Share [Abstract] | ' | ' |
Common stock equivalent shares assuming conversion of preferred stock | 2,718,428 | 2,718,428 |
Common stock equivalent shares attributable to outstanding in-the-money stock options and warrants | 558,810 | 392,980 |
Employee Stock Option [Member] | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Antidilutive shares excluded from the EPS calculation | 20,000 | 471,526 |
Acquisition_of_Subscribers_Det
Acquisition of Subscribers (Details) (USD $) | 3 Months Ended | 0 Months Ended | 0 Months Ended | ||||
Sep. 30, 2014 | Sep. 30, 2013 | Nov. 01, 2013 | Nov. 01, 2013 | Nov. 01, 2013 | Nov. 01, 2016 | Nov. 01, 2014 | |
acquisitions | Upperspace Corporation [Member] | Upperspace Corporation [Member] | Upperspace Corporation [Member] | Upperspace Corporation [Member] | Upperspace Corporation [Member] | ||
Subscriber Acquisition Costs [Member] | Other Intangible Assets [Member] | Scenario, Forecast [Member] | Scenario, Forecast [Member] | ||||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Number of acquisitions | 1 | ' | ' | ' | ' | ' | ' |
Total purchase consideration for acquisition of subscribers | ' | ' | $580,300 | ' | ' | ' | ' |
Subscriber acquisition, cash paid for consideration | ' | ' | 193,433 | ' | ' | 193,433 | 193,433 |
Cash retained by seller | ' | ' | 61,325 | ' | ' | ' | ' |
Discount recorded on long-term liabilities | 24,385 | ' | ' | ' | ' | ' | ' |
Weighted average amortization period for subscriber acquisitions, months | '48 months | ' | ' | ' | ' | ' | ' |
Intangible assets acquired | ' | ' | ' | 530,486 | 7,681 | ' | ' |
Fixed assets acquired | ' | ' | $42,132 | ' | ' | ' | ' |
Goodwill_and_Subscriber_Acquis1
Goodwill and Subscriber Acquisition Costs (Details) (USD $) | 3 Months Ended |
Sep. 30, 2014 | |
Goodwill and Subscriber Acquisition Costs [Abstract] | ' |
Weighted average amortization period for subscriber acquisitions, months | '48 months |
Expected amortization expense, remainder of the fiscal year | $202,000 |
Expected future amortization expense, 2016 | 208,000 |
Expected future amortization expense, 2017 | 140,000 |
Expected future amortization expense, 2018 | $42,000 |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 3 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Jun. 30, 2014 | |
Income Taxes [Abstract] | ' | ' | ' |
Income before income tax expense | $133,322 | $286,390 | ' |
Texas franchise tax expense | 14,050 | 12,600 | ' |
Provision for federal income taxes | 51,267 | 0 | ' |
Valuation allowance of the deferred tax asset | 3,503,000 | ' | 3,452,000 |
Reconciliation of the federal statutory income tax rate to the effective tax rate: | ' | ' | ' |
Income taxes at federal statutory rate | 34.00% | 34.00% | ' |
State income tax, net of federal benefit | 6.00% | 2.90% | ' |
Nondeductible expenses | 9.00% | -10.50% | ' |
Change in valuation allowance | ' | -22.00% | ' |
Effective income tax rate | 49.00% | 4.40% | ' |
Operating Loss Carryforwards [Line Items] | ' | ' | ' |
Net operating loss carryforwards | $36,000,000 | ' | ' |
Earliest Tax Year [Member] | ' | ' | ' |
Operating Loss Carryforwards [Line Items] | ' | ' | ' |
Net operating loss carryforwards expiration year | 1-Jan-19 | ' | ' |
Years open to examination | '2009 | ' | ' |
Latest Tax Year [Member] | ' | ' | ' |
Operating Loss Carryforwards [Line Items] | ' | ' | ' |
Net operating loss carryforwards expiration year | 31-Dec-33 | ' | ' |
Years open to examination | '2012 | ' | ' |
Accrued_Liabilities_Details
Accrued Liabilities (Details) (USD $) | Sep. 30, 2014 | Jun. 30, 2014 |
Accrued Liabilities [Abstract] | ' | ' |
Purchase consideration for acquisition of subscribers | $193,433 | $193,433 |
Property, franchise and sales tax expense | 197,876 | 180,992 |
Employee wages and benefits | 195,360 | 117,229 |
Professional fees | 79,457 | 56,000 |
Deferred rent expense | 48,328 | 48,688 |
Other | 6,309 | 1,187 |
Total accrued liabilities | $720,763 | $597,529 |
Acquisition_Credit_Facility_an2
Acquisition Credit Facility and Long-Term Debt (Narrative) (Details) (Line of Credit [Member], USD $) | 3 Months Ended |
Sep. 30, 2014 | |
Line of Credit [Member] | ' |
Line of Credit Facility [Line Items] | ' |
Amount that may be borrowed | $2,000,000 |
Percentage of cost of acquisition | 55.00% |
Percentage of acquisition with three year maturity | 65.00% |
Basis spread over index rate | 4.00% |
Maximum debt to tangible net worth ratio | 2.5 |
Minimum cash flow to debt service ratio | 2 |
Debt instrument fee | $250 |
Debt instrument fee, percentage | 0.10% |
Acquisition_Credit_Facility_an3
Acquisition Credit Facility and Long-Term Debt (Schedule of Long Term Debt) (Details) (USD $) | 3 Months Ended | |
Sep. 30, 2014 | Jun. 30, 2014 | |
Debt Instrument [Line Items] | ' | ' |
Long-term debt | $232,927 | $297,676 |
Less current portion | -131,154 | -187,029 |
Total long-term debt, less current portion | 101,773 | 110,647 |
Notes Payable [Member] | 4.5 % Note Payable Due February 15, 2015 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt | 21,489 | 34,190 |
Periodic payments, frequency | ' | ' |
monthly | ||
Debt instrument, maturity date | 15-Feb-15 | ' |
Debt instrument, periodic payment | 4,346 | ' |
Effective interest rate | 4.50% | ' |
Notes Payable [Member] | Note Payable Due February 15, 2015 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt | 55,494 | 88,432 |
Periodic payments, frequency | ' | ' |
monthly | ||
Debt instrument, maturity date | 15-Feb-15 | ' |
Debt instrument, periodic payment | 11,189 | ' |
Effective interest rate | 3.25% | ' |
Unamortized discount | 452 | 1,081 |
Notes Payable [Member] | Note Payable Due November 1, 2014 with no Interest [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt | 3,315 | 8,206 |
Periodic payments, frequency | ' | ' |
monthly | ||
Debt instrument, maturity date | 1-Nov-14 | ' |
Debt instrument, periodic payment | 1,674 | ' |
Effective interest rate | 8.00% | ' |
Unamortized discount | 33 | 165 |
Notes Payable [Member] | Note Payable Due May 1, 2015 with no Interest [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt | 16,048 | 21,850 |
Periodic payments, frequency | ' | ' |
monthly | ||
Debt instrument, maturity date | 1-May-15 | ' |
Debt instrument, periodic payment | 2,067 | ' |
Effective interest rate | 8.00% | ' |
Unamortized discount | 485 | 884 |
Capital Lease Obligations [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt | 136,581 | 144,998 |
Periodic payments, frequency | ' | ' |
monthly | ||
Debt instrument, maturity date | 31-May-18 | ' |
Debt instrument, periodic payment | 3,390 | ' |
Effective interest rate | 4.50% | ' |
Unamortized discount | $12,586 | $13,730 |
Stock_Options_and_Warrants_Det
Stock Options and Warrants (Details) (USD $) | 3 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
Options | ' | ' |
Outstanding, beginning balance | 1,226,526 | ' |
Granted | 20,000 | ' |
Forfeited | -105,000 | ' |
Outstanding, ending balance | 1,141,526 | ' |
Exercisable, ending balance | 529,026 | ' |
Weighted Average Exercise Price | ' | ' |
Outstanding, beginning balance | $0.40 | ' |
Granted | $0.66 | ' |
Forfeited | $0.40 | ' |
Outstanding, ending balance | $0.40 | ' |
Exercisable, ending balance | $0.48 | ' |
Number of options available for future issuance | 840,974 | ' |
Fair value of options granted in period | $4,599 | ' |
Fair value of options granted in period, per option | $0.23 | ' |
Stock compensation expense | 1,199 | 1,508 |
Unrecognized compensation cost related to non-vested stock options | $9,740 | ' |
Warrants expired during period | 394,922 | ' |
Vesting Immediately [Member] | ' | ' |
Options | ' | ' |
Granted | 5,000 | ' |
Weighted Average Exercise Price | ' | ' |
Vesting rate | 25.00% | ' |
Vesting Over Time [Member] | ' | ' |
Options | ' | ' |
Granted | 15,000 | ' |
Vesting at Target Dates [Member] | ' | ' |
Options | ' | ' |
Granted | 5,000 | ' |
Related_Party_Transactions_Det
Related Party Transactions (Details) (USD $) | 3 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
Related Party Transactions [Abstract] | ' | ' |
Fees paid to non-employee directors for serving on the Board of Directors | $7,375 | $11,703 |