Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | |
Jun. 30, 2014 | Jun. 23, 2015 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-K | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2014 | |
Trading Symbol | mlhc | |
Entity Registrant Name | M LINE HOLDINGS INC | |
Entity Central Index Key | 1,072,248 | |
Current Fiscal Year End Date | --06-30 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 1,199,555,785 | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | Yes | |
Entity Well Known Seasoned Issuer | No | |
Entity Public Float | $ 204,606 | |
Document Fiscal Year Focus | 2,014 | |
Document Fiscal Period Focus | FY |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Jun. 30, 2014 | Jun. 30, 2013 |
Current assets: | ||
Cash and cash equivalents | $ 46,925 | $ 182,305 |
Accounts receivable, net | 222,344 | 990,010 |
Inventory, net | $ 1,430,682 | 1,555,910 |
Due from related party | 99,348 | |
Deferred financing fees | 199,516 | |
Total current assets | $ 1,699,951 | 3,027,089 |
Property and equipment, net | 402,476 | 556,555 |
Deposits and other | 140,922 | 113,445 |
Total assets | 2,243,349 | 3,697,089 |
Current liabilities: | ||
Bank overdraft | 149,699 | 85,542 |
Accounts payable | 1,350,157 | 1,421,626 |
Accounts payable - related party | 35,954 | 43,454 |
Accrued expenses and other | 2,594,616 | 2,788,697 |
Litigation payable | 287,500 | $ 137,500 |
Derivative liability | 634,769 | |
Line of credit | 2,330,453 | $ 1,702,726 |
Notes payable - current, net of debt discount of $317,977 and $69,996 | 1,018,755 | 675,961 |
Current portion of capital lease obligations | $ 53,901 | 54,501 |
Deferred income | 10,000 | |
Total current liabilities | $ 8,455,804 | 6,920,007 |
Notes payable - net of current portion | 124,023 | 318,903 |
Capital lease obligation, net of current portion | 46,426 | 90,742 |
Total liabilities | $ 8,626,253 | $ 7,329,652 |
Commitments and contingencies | ||
Stockholders' deficit: | ||
Preferred stock: $0.001 par value, 20,000,000 shares authorized, 200,000 shares issued and outstanding at June 30, 2014 and June 30, 2013 respectively | $ 200 | $ 200 |
Common stock: $0.001 par, 1,000,000,000 shares authorized, 243,178,484 and 70,211,145 shares issued and outstanding at June 30, 2014 and June 30, 2013, respectively | 243,178 | 70,211 |
Additional paid in capital | 12,846,981 | 10,741,397 |
Accumulated deficit | (19,473,263) | (14,444,371) |
Total stockholders' deficit | (6,382,904) | (3,632,563) |
Total liabilities and stockholders' deficit | $ 2,243,349 | $ 3,697,089 |
CONSOLIDATED BALANCE SHEETS (PA
CONSOLIDATED BALANCE SHEETS (PARENTHETICAL) - USD ($) | Jun. 30, 2014 | Jun. 30, 2013 |
Statement of Financial Position [Abstract] | ||
Debt Discount | $ 317,977 | $ 69,996 |
Preferred stock, Par Value | $ 0.001 | $ 0.001 |
Preferred stock, Shares Authorized | 20,000,000 | 20,000,000 |
Preferred stock, Shares Issued | 200,000 | 200,000 |
Preferred stock, Shares Outstanding | 200,000 | 200,000 |
Common Stock, Par Value | $ 0.001 | $ 0.001 |
Common Stock, Shares Authorized | 1,000,000,000 | 1,000,000,000 |
Common Stock, Shares Issued | 243,178,484 | 70,211,145 |
Common Stock, Shares Outstanding | 243,178,484 | 70,211,145 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 12 Months Ended | |
Jun. 30, 2014 | Jun. 30, 2013 | |
Income Statement [Abstract] | ||
Sales | $ 8,701,122 | $ 9,324,685 |
Cost of sales | 7,050,708 | 7,561,454 |
Gross profit | 1,650,414 | 1,763,231 |
Operating expenses: | ||
Selling, general and administrative | $ 3,811,699 | 4,226,647 |
Write off of related party receivables | 1,446,067 | |
Total operating expenses | $ 3,811,699 | 5,672,714 |
Operating loss | (2,161,285) | (3,909,483) |
Interest expense | (1,884,005) | $ (497,365) |
Change in derivative liability | (946,518) | |
Loss on settlement of liability | (35,190) | |
Total other expenses | (2,865,713) | $ (497,365) |
Loss before income tax | (5,026,998) | (4,406,848) |
Income tax benefit (provision) | (1,894) | 13,580 |
Net loss | $ (5,028,892) | $ (4,393,268) |
Loss per common share: | ||
Basic and diluted | $ (0.04) | $ (0.07) |
Weighted average number of common shares outstanding - Basic and diluted | 116,246,955 | 60,746,844 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT - USD ($) | Preferred Stock | Common Stock | Additional Paid-in Amount | Related Party Receivable | Accumulated Deficit | Total |
Balance at Jun. 30, 2012 | $ 46,871 | $ 10,179,021 | $ (94,000) | $ (10,051,103) | $ 80,789 | |
Balance (in shares) at Jun. 30, 2012 | 46,871,145 | |||||
Shares issued for deferred financing costs | $ 200 | 149,074 | 149,274 | |||
Shares issued for deferred financing costs, Shares | 200,000 | |||||
Shares issued for services | $ 14,840 | 253,102 | 267,942 | |||
Shares issued for services (in shares) | 14,840,000 | |||||
Shares issued for in lieu of payroll | $ 8,500 | $ 160,200 | 168,700 | |||
Shares issued for in lieu of payroll, Shares | 8,500,000 | |||||
Share based compensation | $ 94,000 | 94,000 | ||||
Net loss | $ (4,393,268) | (4,393,268) | ||||
Balance at Jun. 30, 2013 | $ 200 | $ 70,211 | $ 10,741,397 | $ (14,444,371) | (3,632,563) | |
Balance (in shares) at Jun. 30, 2013 | 200,000 | 70,211,145 | ||||
Shares issued for services | $ 12,805 | 54,646 | 67,451 | |||
Shares issued for services (in shares) | 12,805,130 | |||||
Shares issued for in lieu of payroll | $ 6,000 | 54,000 | 60,000 | |||
Shares issued for in lieu of payroll, Shares | 6,000,000 | |||||
Shares issued to settle unpaid salaries | $ 13,000 | 117,000 | 130,000 | |||
Shares issued to settle unpaid salaries, Shares | 13,000,000 | |||||
Shares issued for conversion of debt | $ 136,062 | 310,427 | 446,489 | |||
Shares issued for conversion of debt, Shares | 136,062,209 | |||||
Shares issued for settlement of liability | $ 5,100 | 35,190 | 40,290 | |||
Shares issued for settlement of liability, Shares | 5,100,000 | |||||
Waiver of officers salaries | 390,000 | 390,000 | ||||
Resolution of derivative liability | $ 1,144,321 | 1,144,321 | ||||
Net loss | $ (5,028,892) | (5,028,892) | ||||
Balance at Jun. 30, 2014 | $ 200 | $ 243,178 | $ 12,846,981 | $ (19,473,263) | $ (6,382,904) | |
Balance (in shares) at Jun. 30, 2014 | 200,000 | 243,178,484 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Jun. 30, 2014 | Jun. 30, 2013 | |
Cash flows from operating activities: | ||
Net loss | $ (5,028,892) | $ (4,393,268) |
Reconciliation of net loss to net cash provided by operations: | ||
Provision for deferred income tax | (16,710) | |
Write off related party receivable | $ 1,446,067 | |
Gain on disposition of assets | $ (19,000) | |
Bad debt expense | 490,601 | |
Amortization of deferred financing costs | 199,516 | $ 99,758 |
Amortization of debt discount | 642,517 | 7,504 |
Depreciation | 162,079 | $ 173,532 |
Change in derivative liability | 946,518 | |
Share based compensation | $ 127,451 | $ 530,642 |
Reserve for inventories | $ 200,000 | |
Loss on settlement of liability | $ 35,190 | |
Waiver of officers' salaries | 390,000 | |
Changes in operating assets and liabilities: | ||
Accounts receivable | 457,744 | $ (195,693) |
Inventory | 125,228 | (146,499) |
Prepaid expenses and other assets | (27,477) | (30,639) |
Due from related party | (81,331) | 1,626,806 |
Accounts payable, accrued expenses and other | 624,647 | 43,454 |
Deferred income | (10,000) | 10,000 |
Litigation payable | 150,000 | 105,959 |
Net cash used in operating activities | (815,209) | (539,087) |
Cash flows from investing activities: | ||
Acquisition of property and equipment | (8,000) | $ (19,335) |
Proceeds from disposition of assets | 19,000 | |
Net cash provided by (used in) investing activities | 11,000 | $ (19,335) |
Cash flows from financing activities: | ||
Net borrowings (repayments) on line of credit | (68,571) | 348,847 |
Proceeds from notes payable | $ 1,037,978 | 596,051 |
Due from related party | (72,800) | |
Bank overdraft | $ 64,157 | 85,542 |
Payments on notes payable | (319,819) | (190,701) |
Payments on capital leases | (44,916) | (31,424) |
Net cash provided by financing activities | 668,829 | 735,515 |
Net increase (decrease) in cash and cash equivalents | (135,380) | 177,093 |
Cash and cash equivalents at beginning of period | 182,305 | 5,212 |
Cash and cash equivalents at end of period | 46,925 | 182,305 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | $ 279,374 | $ 390,103 |
Cash paid for income taxes | ||
Supplemental disclosure of non cash financing activities: | ||
Borrowings on capital leases | $ 167,702 | |
Shares issued for deferred financing costs | 149,274 | |
Settlement of liabilities and deferred financing costs through line of credit and notes payable | $ 270,000 | |
Debt discount from derivative liability | $ 832,572 | |
Interest added to principal | 759,008 | |
Shares issued to settle unpaid salary | 130,000 | |
Shares issued for settlement of debt | 5,100 | |
Shares issued for conversion of debt | 446,489 | |
Resolution of derivative liability | $ 1,144,321 |
Organization and Business
Organization and Business | 12 Months Ended |
Jun. 30, 2014 | |
Notes to Financial Statements [Abstract] | |
Organization and Business [Text Block] | 1. Organization and Business Organization and Business M. Line Holdings, Inc. (we, our, the Company) was incorporated in Nevada on September 24, 1997. The Company and its subsidiaries are engaged in the following businesses: a) Acquiring, refurbishing and selling pre-owned CNC machine-tool equipment through Elite Machine Tool Company (Elite), its wholly owned subsidiary, the machine sales group. b) Precision Aerospace & Technologies, Inc., (formerly Eran Engineering, Inc.) (Precision), its wholly owned subsidiary, manufactures precision metal component parts for the aerospace, medical and defense, industries. This is the precision manufacturing group. c) M Line Holdings, inc. is currently providing financial and management advice to customers. this business will be managed by M Line Financial Services, Inc. (formed subsequent to this financial year end) and will be part of the new financial and technology group set up in Fiscal 2015. |
Basis of Presentation and Signi
Basis of Presentation and Significant Accounting Policies | 12 Months Ended |
Jun. 30, 2014 | |
Notes to Financial Statements [Abstract] | |
Basis of Presentation and Significant Accounting Policies [Text Block] | 2. Basis of Presentation and Significant Accounting Policies Basis of Presentation The accompanying financial statements are prepared in accordance with accounting principles generally accepted in the United States of America. Principles of Consolidation The accompanying consolidated financial statements include the accounts of M Line Holdings, Inc. and its wholly-owned subsidiaries: Elite and Precision. All intercompany accounts and transactions have been eliminated. Business Segments FASB ASC Topic 280: Segment Reporting Concentrations of Credit Risks Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash and cash equivalents and trade accounts receivable. The Company invests its cash balances through high-credit quality financial institutions. From time to time, the Company maintains bank account levels in excess of FDIC insurance limits. If the financial institutions in which the Company has its accounts have financial difficulties, the Companys cash balances could be at risk. Sales from significant customers representing 10% or more of sales consist of the following customers for the years ended June 30: Year ended Year ended June Percent of sales 18.00 16.76 Number of customers 2 1 As a result of the Companys concentration of its customer base and industries served, the loss or cancellation of business from, or significant changes in scheduled deliveries of product sold to the above customers or a change in their financial position could materially and adversely affect the Companys consolidated financial position, results of operations and cash flows. Two customers, included in the Precision Manufacturing segment represents a significant concentration. Sales to these customers as a percentage of sales within the Precision Manufacturing Segment are as follows for the years ended June 30: Year ended June 30, 2014 2013 % of segment sales significant customer sales concentration 76 45 Accounts receivable from these customers at June 30, 2014 and 2013 were $84,174 and $254,757 respectively. The Companys Precision Manufacturing segment operated a single manufacturing facility located in Tustin, California. The company has moved its location to a facility in Anaheim, California. on July 1, 2014. A major interruption in the manufacturing operations at this facility would have a material adverse effect on the consolidated financial position and results of operations of the Company. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities and the reported amounts of sales and expenses during the reporting period. Significant estimates made by management are, among others, realization of inventories, collectability of accounts receivable, litigation, impairment of goodwill, and long-lived assets other than goodwill. Actual results could materially differ from those estimates. Cash and Cash Equivalents The Company considers all highly liquid investments with insignificant interest rate risk and original maturities of three months or less from the date of purchase to be cash equivalents. The carrying amounts of cash and cash equivalents approximate their fair values. The Company maintains cash and cash equivalents balances at certain financial institutions in excess of amounts insured by federal agencies. Management does not believe that as a result of this concentration, it is subject to any unusual financial risk beyond the normal risk associated with commercial banking relationships. Accounts Receivable The Company performs periodic credit evaluations and continually monitors its collection of amounts due from its customers. The Company adjusts credit limits and payment terms granted to its customers based upon payment history and the customers current creditworthiness. The Company does not require collateral from its customers to secure amounts due from them. The Company regularly reviews its accounts receivable and collection of these balances subsequent to each of these periods. The Company maintains reserves for potential credit losses, and historically, such losses have been within managment expectations. As of June 30, 2014 and 2013, accounts receivable totals were $2,321,344 and $990,010 net of an allowance for bad debt expense of $45,534 and $29,566 respectively. Inventories Inventories are stated at the lower of cost or market, cost being determined using the first in, first out (FIFO) method. The Company provides inventory reserves for obsolescence and other matters based on managements review of current inventory levels. The Company includes labor and overhead costs directly associated with manufacturing its products in inventory costs. Deferred financing fees The Company incurs costs in connection with its line of credit which may consist of legal, finders and due diligence fees. Such costs are deferred and amortized to interest expense over the term of the line of credit. Amortization of deferred financing fees for the years ended June 30, 2014 and 2013 amounted to $199,516 and $99,758, respectively. Property and Equipment Property and equipment is stated at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets. Equipment under capital lease obligations is depreciated over the estimated useful life of the asset. Leasehold improvements are amortized over the shorter of the estimated useful life or the term of the lease. Repairs and maintenance are expensed as incurred, while improvements are capitalized. Upon the sale or retirement of property and equipment, the accounts are relieved of the cost and the related accumulated depreciation, which any resulting gain or loss included in the consolidated statements of operations. Long-Lived Assets The Company reviews its fixed assets and certain identifiable intangibles with definite lives for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted operating cash flow expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset exceeds the fair value of the asset or discounted cash flows. Long-lived assets to be disposed of are reported at the lower of carrying amount or fair value less costs to sell. Based on managements review, the Company determined that there was no impairment to its long-lived assets for the years ended June 30, 2014 and 2013. Income Taxes The Company accounts for income taxes in accordance with FASB ASC Topic 740-10, Income Taxes The Company accounts for uncertain tax positions in accordance with ASC 740, which prescribes a recognition threshold and measurement attribute for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return and also provides guidance on various related matters such as de-recognition, interest, penalties and disclosures required. The Company recognizes interest and penalties, if any, related to unrecognized tax benefits in income tax expense. Contingencies and Litigation The Company evaluates contingent liabilities including threatened or pending litigation. Revenue Recognition The Company recognizes revenue in accordance with Staff Accounting Bulletin No. 104 Revenue Recognition. Revenue is recognized at the date of shipment to customers when; a formal arrangement exists, the price is fixed or determinable, the delivery is completed, no other significant obligations of the Company exist, and collectability is reasonably assured. Revenues generated from the Precision Manufacturing segment consist of manufactured parts and in some instances, assembly of these items based on detailed engineering specifications received by the Company from the customer. The Company generally begins to manufacture the parts upon the receipt and acceptance of a purchase order which specifies the quantity, price and delivery dates such products are required to be shipped within. Prior to shipment, physical inspection of the parts is performed to ensure specifications meet the engineering requirements. Historically, customer returns have been inconsequential. Revenues generated from the sales of new and pre-owned Computer Numerically Controlled machines from the Machine Tools segment are based on the acceptance of a purchase order and the customers acknowledgement of the Companys terms and conditions which specifies the shipping terms, payment terms and the warranty period, if any. In certain instances, the Company may perform installation services including the leveling of the machine, which is inconsequential. Under agreements with certain new equipment manufacturers, a ninety day warranty is provided to customers whereby the manufacturer is responsible for any replacement parts and the Company is responsible for the installation of the parts. In certain instances, the Company provides warranties for used equipment for periods ranging up to thirty days. Historically, warranty costs have been inconsequential. Generally, the Company does not accept returns of equipment. Warranty expense, included in cost of sales, for the years ended June 30, 2014 and 2013 amounted to $96,955 and $68,364, respectively. Payments received before all of the relevant criteria for revenue recognition are satisfied are recorded as customer deposits. Revenues generated from financial services are recognized at the time the services are performed. revenues generated by M Line Holdings, inc. consist of the following services including, financial advice, raising new capital, advice and support in relation to new stock listings, reverse mergers etc. and where applicable sales support. Cost of Goods Sold The Company includes the following in cost of goods sold; materials, production labor, tooling, depreciation, outside services and an apportionment of S.G & A. Advertising The Company expenses the cost of advertising when incurred as selling expenses. Advertising expenses were $6,266 and $17,901, for the years ended June 30, 2014 and 2013, respectively. Stock-Based Compensation The Company accounts for share-based awards issued to employees in accordance with FASB ASC 718. Accordingly, employee share-based payment compensation is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the requisite service period or vesting period. Additionally, share-based awards to non-employees are expensed over the period in which the related services are rendered at their fair value. The Company accounts for share based awards issued to non-employees in accordance with FASB ASC 505. This requires us to estimate the value of securities used for compensation and to charge such amounts to expense over the periods benefited. The estimated fair value at the date of the award of options or warrants for our common stock is estimated using the Blach-Scholes pricing model as follows: Expected volatility is based on the historical volitility of our stock. the risk free interest rate is based on the US Treasury constant maturity rates as of the grant date. The expected life of the option is based on historical exercise behaviour and expected future experience. Net Loss per Share Basic net loss per share is calculated by dividing net loss by the Companys weighted average common shares outstanding during the period. Diluted net income per share reflects the potential dilution to basic earnings per share that could occur upon conversion or exercise of securities, options or other such items to common shares using the treasury stock method, based upon the Companys weighted average fair value of the common shares during the period. For each period presented, basic and diluted net loss per share amounts are identical as the Company does not have potentially dilutive securities. Fair Value of Financial Instruments The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents, accounts receivable, accounts payable, accrued expenses, line of credit and notes payable approximates fair value due to the immediate or short-term maturity of these financial instruments. The fair value of long-term notes approximates the carrying amounts based upon the expected borrowing rate for debt with similar remaining maturities and comparable risk. Reclassification Certain reclassification has been made to the previous years financial statements to conform to current year presentation with no effect on previously reported net loss. Recent Accounting Pronouncements The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new pronouncements that have been issued that might have a material impact on its financial position or results of operations. |
Going Concern and Management Pl
Going Concern and Management Plans | 12 Months Ended |
Jun. 30, 2014 | |
Notes to Financial Statements [Abstract] | |
Going Concern and Management Plans [Text Block] | 3. Going Concern and Management Plans. The Companys consolidated financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, the Company has an accumulated deficit of $19,473,263 as of June 30, 2014, negative working capital and negative cash flows from operations for the year ended June 30, 2014. The Company recognizes that the difficulty in raising new funds and the high cost of current funding has impacted the working capital needs of the Company. The consolidated financial statements do not include any adjustments relating to the recoverability and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Companys continuation as a going concern is dependent upon its ability to retain its current short term financing and ultimately to generate sufficient cash flow to meet its obligations on a timely basis in order to attain profitability. To date the Company has funded its operations from both internally generated cash flow and external sources. The Company will continue to pursue additional external capitalization opportunities, as necessary, to fund its long-term goals and objectives. The Company has taken significant steps to resolve these issues. The Company has pursued various sources of financing including asset based lending in order to relieve its cash flow deficiencies. The Company has signed documention with both TCA Global Credit Master Fund, LLC ("TCA") and a lending source that will result in the repayment of $1,200,000 of the outstanding amount due TCA over a fifteen month period. The Company continues to negotiate for other capital that will pay off any balance due TCA. The Company's future plans include the acquisition of another machine tool shop and another CNC machinery sales company. These acquisitions will add revenue and profit and will help to make the Company more attractive to prospective capital sources. |
Inventories
Inventories | 12 Months Ended |
Jun. 30, 2014 | |
Notes to Financial Statements [Abstract] | |
Inventories [Text Block] | 4. Inventories Inventories consist of the following at June 30: June 30, 2014 June 30, 2013 Finished goods and components $ 1,112,647 $ 971,099 CNC machines held for sale 152,000 364,583 Work in progress 327,620 415,108 Raw materials and parts 14,336 5,120 1,606,603 1,755,910 Less: Reserve for inventories (175,921 ) (200,000 ) $ 1,430,682 $ 1,555,910 |
Related Parties
Related Parties | 12 Months Ended |
Jun. 30, 2014 | |
Notes to Financial Statements [Abstract] | |
Related Parties [Text Block] | 5. Related Parties As of June 30, 2014 and 2013, the amount due from related parties includes an amount due from an officer of Elite amounting to $0 and $99,348 respectively. As of June 30, 2014 and 2013, the Company owes $35,954 and $43,454 respectively, to one of its officers for expenses paid on behalf of the Company. During the year ended June 30, 2014, two officers of the Company waived their salaries for the year totalling $390,000. The waived salaries were credited to additional paid in capital. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Jun. 30, 2014 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment [Text Block] | 6. Property and Equipment Property and equipment consists of the following at June 30: Estimated 2014 2013 Machinery and equipment 7 $ 2,440,562 $ 2,603,313 Fixtures, Fixtures and office equipment 3 to 5 345,682 341,308 Vehicles 5 23,276 23,276 Leasehold improvements 3 105,298 105,298 Total 2,914,818 3,073,195 Less accumulated depreciation 2,512,342 2,516,640 $ 402,476 $ 556,555 Depreciation expense was $162,079 and $173,532 for the years ended June 30, 2014 and 2013, respectively. |
Accrued Expenses and Other
Accrued Expenses and Other | 12 Months Ended |
Jun. 30, 2014 | |
Notes to Financial Statements [Abstract] | |
Accrued Expenses and Other [Text Block] | 7. Accrued Expenses and Other Accrued expenses and other consist of the following at June 30: June 30, 2014 June 30, 2013 Compensation and related benefits $ 2,023,064 $ 1,934,314 Audit fees 46,000 72,500 Other 525,552 781,883 $ 2,594,616 $ 2,788,697 |
Capital Leases
Capital Leases | 12 Months Ended |
Jun. 30, 2014 | |
Notes to Financial Statements [Abstract] | |
Capital Leases [Text Block] | 8. Capital Leases The Company leases certain equipment under capital leases with terms ranging from four to five years. Future annual minimum lease payments are as follows as of June 30: June 30, 2014 June 30, 2013 2014 $ 53,901 $ 54,501 2015 46,426 54,501 2016 - 36,241 2017 - - Total minimum lease payments 100,327 145,243 Less amount representing interest - - Present value of future minimum lease payments 100,327 145,243 Less current portion of capital lease obligations (53,901 ) (54,501 ) Capital lease obligations, net of current portion $ 46,426 $ 90,742 |
Line of Credit
Line of Credit | 12 Months Ended |
Jun. 30, 2014 | |
Notes to Financial Statements [Abstract] | |
Line of Credit [Text Block] | 9. Line of Credit Main Credit: TCA Global Credit Master Fund, LLC: The line of credit with Main Credit was replaced on April 30, 2013 with a line of credit from TCA Global Credit Master Fund, LLC (TCA) in the amount of $10 million. As of June 30, 2014, the Company has drawn $1,700,000 from the line of which $2,330,453, including interest, is outstanding as of June 30, 2014. Amounts drawn from the line of credit are subject to interest and matured on October 31, 2013. The line was automatically renewed for a further six months and expired on April 30, 2014. The Company has entered into a settlement agreement with TCA that results in the repayment of $1,200,000 of the TCA debt over a fifiteen month period. The line of credit with TCA is secured by the receivables and inventory and a second position on the equipment of Precision. and the inventory and receivables of Elite together with a blanket lien over all of the Companys assets. |
Notes Payable
Notes Payable | 12 Months Ended |
Jun. 30, 2014 | |
Notes to Financial Statements [Abstract] | |
Notes Payable [Text Block] | 10. Notes Payable Notes payable as of June 30 consist of: June 30, June 30, 2014 2013 Notes payable to a financial institution, secured by the underlying equipment in aggregate monthly installments of varying amounts, on a reducing balance method, with the balance due in October 2016. $ 247,811 $ 422,940 An unsecured note payable to a corporation in respect of accounting software payable in monthly installments of $ 1,923. This note was disputed and was written off in the absence of any collection activity for over four years. - 46,811 One unsecured 5% convertible notes payable to a financial institution due March 4, 2015 110,000 - An unsecured 12% convertible note payable to a financial institution due February 12, 2016 50,631 - An unsecured 12% convertible note payable to a financial institution due January 31, 2015 21,500 - Two unsecured 8% convertible notes payable in the sum of $110,751, to a financial institution due February 12, 2015 50,000 - Two unsecured notes payable in the sum of $150,000, each, to a financial institution due in full in November 2011 and March 31, 2012. The Company is currently in default and has negotiated to pay the notes in monthly installments of $20,000 commencing November 2012. 75,459 354,459 Two unsecured 8% convertible notes payable in the sum of $110,674 to a financial institution with $50,000 due on February 6, 2015 and $55,674 due on May 30, 2015 105,674 - Three unsecured 8% convertible notes payable in the sum of $160,674 each, to a financial institution with $50,000 due on February 6, 2015 and $110,674 due on June 10, 2015 160,674 - Three unsecured 8% convertible notes payable to a financial institution $50,000 due April 25, 2015, $75,000 due on December 25, 2015 and $125,662 due October 3, 2015 225,562 - Two unsecured 8% convertible notes payable to a financial institution both due May 30, 2015 160,674 - An unsecured 8% convertible note payable to a financial institution on due June 10, 2015 50,000 - An unsecured note payable to a corporation in weekday amounts of $700, increasing to $1,650, in September 2013 and ending in December 2013. This note is in default but a settlement reached with monthly payments being made will pay off the note by June 25, 2015 40,300 125,600 An unsecured note payable to a corporation in weekday amounts of $691 each, through December 2013. This note is in default but a settlement reached with monthly payments being made will pay off this note by October 15, 2015 57,120 115,050 An unsecured note payable to a corporation in weekday amounts of $841 each, through February 2014. This note is in default. 105,350 - Less Debt Discount (317,977 ) (69,996 ) TOTAL 1,142,778 994,864 Less - Current Portion 1,018,755 675,961 Long Term Portion $ 124,023 $ 318,903 2015 124,023 123,780 2016 - 123,780 2017 - 71,343 2018 - - Thereafter - - 124,023 318,903 In connection with one of the notes, the Company issued 17 million warrants that have a term of 5 years and an exercise price of $0.003 per share. The exercise price on these warrants contain a reset provision in the event shares are sold by the Company at a price lower than the exercise price. Consequently, the warrants were accounted for as derivatives and the fair value of such warrants amounting to $54,400 were recognized as a debt discount and amortized over the term of the note. |
Litigation Payable
Litigation Payable | 12 Months Ended |
Jun. 30, 2014 | |
Payables and Accruals [Abstract] | |
Litigation Payable [Text Block] | 11. Litigation Payable June 30,2014 June 30,2013 An unsecured note payable to a corporation in settlement of a lawsuit payable in 12 monthly payments of $5,000. $ 210,000 60,000 Unsecured notes payable to various parties in settlement of lawsuits payable in full. 77,500 77,500 $ 287,500 137,500 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Jun. 30, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies [Text Block] | 12. Commitments and Contingencies Leases The Company leased its manufacturing and office facilities under non-cancelable operating lease arrangements. Rent expense under operating leases was $545,177 and $460,565 for the years ended June 30, 2014 and 2013, respectively. Future rent under lease agreements for the next five years are as follows: 2015 233,530 2016 287,242 2017 295,859 2018 304,735 2019 313,877 Thereafter 1,777,349 |
Litigation
Litigation | 12 Months Ended |
Jun. 30, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | |
Litigation [Text Block] | 13. Litigation 1. James M. Cassidy v. Gateway International Holdings, Inc. , American Arbitration Association, Case No. 73-194-32755-08 The Company was served with a Demand for Arbitration and Statement of Claim, which was filed on September 16, 2008. The Statement of Claim alleges that claimant is an attorney who performed services for the Company pursuant to an agreement dated April 2, 2007 between the Company and the claimant. The Statement of Claim alleges that the Company breached the agreement and seeks compensatory damages in the amount of $195,000 plus interest, attorneys fees and costs. Management denies the allegations of the Statement of Claim and will vigorously defend against these allegations. An arbitrator has not yet been selected, and a trial date has not yet been scheduled. No provision has been made in the June 30, 2014 financial statements with respect to this matter. because the Company has assessed the litigation as having no merit and the likelihood of any liability pursuant to this litigation is remote. 2. CNC Manufacturing v. All American CNC Sales, Inc., Elite Machine Tool Company/Sales & Services, CNC Repos Plaintiff filed this Complaint on October 2, 2008. The Complaint alleges causes of action for breach of contract and rescission and claims that All American breached the agreement with CNC Manufacturing by failing to deliver a machine that conforms to the specifications requested by CNC Manufacturing, and requests damages totaling $138,750. Elite Machine filed an Answer timely, on January 15, 2009. Abstract of Judgment and Writ were issued August 17, 2012. The company entered into a settlement agreement for a settlement in the total amount of $37,500. However, no payments have been made to date. A provision has been made in the June 30, 2014 financial statements with respect to this matter in the sum of $37,500. 3. Donald Yu v. M Line Holdings, Inc., et al.; Case No. 30-2012-00574019- CU-BC-CJC This is an employment dispute asserted by a former employee against M Line Holdings and two corporate insiders, Jitu Banker and Anthony Anish, in their respective individual capacities. The action was filed in Orange County Superior Court on June 4, 2012. The parties entered into a settlement agreement and stipulation for judgment against M Line Holdings, only, on about May 12, 2013. Pursuant to the terms and conditions of the settlement agreement, M Line agreed to pay $21,450.00 in three (3) equal installments. M Line Holdings failed to make payment on a timely basis, and plaintiff filed a stipulated judgment against M Line Holdings on June 12, 2013. Plaintiff also filed default judgments against Messrs. Banker and Anish. In response, defendants filed a motion to set aside the defaults and vacate the default judgments against Messers. Banker and Anish as well as renegotiate the terms of the prior settlement with Plaintiff. On or about September 30, 2013, the parties entered into a supplemental settlement agreement and mutual release wherein the Company agreed to pay plaintiff the sum of $24,000 in two (2) equal installments. The first installment of $12,000 has already been paid. The final installment of $12,000 was due on or before October 30, 2013, and has not been paid at this time. A judgment remains outstanding against the Company in the sum of $12,000.00. 4. Subramani Srinivasan, et al. v. M Line Holdings, Inc., et al.; Case No. 30-2014-00724484-CU-CO-CJC This is a breach of contract, fraud, and related causes of action against Defendants Eran Engineering, Inc.; Bart Webb; Precision Aerospace and Technologies, Inc. (erroneously sued as Precision Aerospace Technologies, Inc.); M-Line Holdings, Inc.; Anthony Anish; Jitu Banker; Larry Consalvi; and Elite Machine Tools (collectively, Defendants). The parties entered into a settlement agreement against the corporate defendants on or about January 22, 2015. Pursuant to the terms and conditions of the settlement agreement, the corporate defendants agreed to pay $20,000 in three (3) equal installments on or before April 30, 2015. As of June 2, 2015, the corporate defendants have paid $20,000 and this case has been dismissed, which effectively terminates all litigation in its entirety. 5. Can Capital Asset Servicing, Inc. v. E.M. Tool Company, Inc., et al.; Case No. 30-2014-00727606- CU-CL-CJC This is a breach of contract and related claims arising out of a business loan, and alleges that E.M. Tool failed to pay Can Capital all amounts due under the loan agreement in the principal sum of $58,313, plus interest, costs and attorneys fees. On or about November 2014, the parties entered into a settlement agreement and stipulated judgment. Pursuant to the terms and conditions of the settlement agreement, the Company agreed to pay plaintiff the sum of $50,000 in installments on or before May 15, 2015. As of May 13, 2015, the defendants have made partial payments, and still owe plaintiff $25,500. Plaintiff provided notice of its intent to file the stipulated judgment on May 7, 2015, and commence collection efforts if payment of $10,000 is not paid prior thereto and those payments have been made. This amount has been provided for in the June 30, 2014 finacial statements. 6 . Fadal Machining v. All American CNC Sales, et al The Complaint was filed on June 12, 2009. The Complaint alleges causes of action for breach of contract and common counts against All American CNC seeking damages in the amount of at least $163,579, and arises from a claim by Fadal that All American failed to pay amounts due. On June 26, 2009, Fadal amended the complaint to include M Line Holdings, Inc. as a defendant. A settlement agreement in the amount of $60,000 was signed on May 31, 2011. The Company had made a provision in the sum of $60,000 in the financial statements as of June 30, 2013, which amount has been increased to $210,000 in the financial statements as of June 30, 2014 as no payments that were due under the settlement agreement have been made. The increase to $210,000 includes the original amount due to the Plaintiff plus accrued interest. Judgment was entered on June 16, 2011, and a Writ was issued on February 24, 2012. 7. Fox Hills Machining v. CNC Repos The complaint was filed on April 14, 2009. The complaint alleges causes of action for Declaratory Relief, Breach of Contract, Fraud, Common Counts, and Negligent Misrepresentation, claiming the Defendant failed to pay Fox Hills Machining for the sale of two machines from Fox Hills to CNC Repos. The damages sought in the complaint are estimated to be approximately $40,000. Court records show that a stipulated judgment was entered on August 27, 2012 and a writ was issued on September 9, 2012. However, an agreement has been entered into with Fox Hills Machinery to pay off the judgment in the sum of $48,673. A sum of $40,000 has been paid in installments of $10,000 each and the final payment of $8,673 being made on December 9, 2013. No provision is required in this matter in the June 30, 2014 financial statements as the plaintiff has been paid in full. 8. C. William Kircher Jr. v. M Line Holdings, Inc. A former attorney for M Line Holdings, Inc. has sued seeking damages for failure to pay legal fees in the amount of $120,166. The parties reached a settlement. The terms of the settlement call for 12 payments of $5,000 per month commencing August 25, 2011 and the issuance of 150,000 shares of common stock. The Company has issued the 150,000 shares of common stock and made two payments to date. The Company has a provision in the sum of $50,000 in the financial statements as of June 30, 2014. The Company currently is in default of its payment obligations under the settlement. Plaintiff currently is seeking to obtain a Judgment as a result of the breach of the settlement agreement. 9. Timothy D. Consalvi v. M Line Holdings, Inc. et.al A former president of All American CNC Sales, Inc. has filed suit against the Company seeking payment on an alleged severance obligation by the Company. The Complaint does not specify the damages sought. The parties then reached a settlement in the principal sum of $40,000 to be documented in due course. Meanwhile a default was entered against the Company, which management believes was in error because a settlement was already reached by the principal parties involved. The default has since been vacated, and the Company has answered the complaint and has filed a motion for leave to file a cross complaint. A settlement of $50,000 was reached in this case, requiring payments commencing on March 11, 2011 for 10 months. The first two months payments were made; however, the Company currently is in default of the terms of this settlement agreement. Mr. Consalvi filed his stipulated judgment on March 5, 2012. Abstract of judgment and Writ were issued on March 13, 2012. A provision in the sum of $40,000 has been made in the financial statements as of June 30, 2014. To date there has been no further action on this case, and the Company plans to resolve this matter as soon as possible. 10. All Direct Travel Services, Inc. v. Jitu Banker, M Line holdings, Inc., Airworks International, Inc., This case was settled as to Jitu Banker and the Company for $2,000 payable on February 25, 2013. We do not yet have sufficient information to determine what the potential outcome of this may be or whether or to what extent it would or could have a financial impact on the Company. A default judgment was entered on January 6, 2012. To date there has been no further action on this case, and the Company plans to resolve this matter as soon as possible. 11. Douglas Technologies Group, Inc. v Elite Machine Tool Company and Lawrence Consalvi, et al., This suit was filed subsequent to June 30, 2013 in respect of an alleged deficiency in the machine supplied to Douglas Technologies. The company decided to settle the lawsuit and thereby entered into a settlement agreement with the customer. This case was settled on November 5, 2013 for $50,000 requiring a payment of $10,000 on November 15, 2013 with the balance being paid in 8 monthly installments of $5,000 each. No provision is required in this matter in the June 30, 2014 financial statements as the plaintiff has been paid in full 12. Alu Forge, Inc., dba American Handforge . v Jitu Banker, Precision Aerospace & Technologies, Inc., and M Line Holdings, Inc., et al., This suit was filed in respect of materials supplied to the company. The company decided to settle the lawsuit and thereby entered into a settlement agreement with the plaintiff. The case was settled on October 31, 2013 for $19,500 with payments of $5,250.00 on October 31, 2013, $5,250 on November 30, 2013 and the balance of $9,000 on December 31, 2013. The Company has made all of the required payments and therefore no provision is required in the financial statements as of June 30, 2014 13. Yates, Fontenot, Smith & Brum, LLC v. M Line Holdings, Inc. (formerly Gateway International Holdings, Inc.), et al.; The above-referenced matter is an unlawful detainer action concerning certain real property located at 2672 Dow Avenue, Tustin, California. The unlawful detainer action was filed against the Company by its landlord Yates, Fontenot, et al. on February 15, 2013. On or about September 2013, the parties settled the action for an agreed upon sum payable in installments through January 5, 2014. Assuming all payment obligations are made, plaintiff shall file a request for dismissal with prejudice of the entire action by or before March 14, 2014. All of the payments due to Plaintiff has been made and no provision is required as of June 30, 2014. The Company moved out of its Tustin location in July 2014 and agreed the surrender of its lease with the landlord, Yates, Fontenot, Smith and Brum, LLC. No further action will be taken on this matter. 14. TCA Global Credit Master Fund, L.P. vs M LI ne Holdings, Inc. EM Tool Company, Inc. dba Elite Machine Tool, Precision Aerospace and Technologies, Inc., Anthony Anish and Jitendra Banker Plaintiff filed this case on July 1, 2014 in Broward County, Florida. The complaint alleges that defendants owe the Plaintiff the amount due under the revolving note, and is claiming foreclosure of the collateral, breach of the credit agreement and a claim against the individuals under the validity agreement due to the non-payment. The Plaintiff obtained a default judgment however due to a settlement agreement reached on September 5, 2014 ceased any further legal activity. The Defendants were unable to honor the agreement and Plaintiff continued to obtain sister state in California and Nevada. On February 23, 2015 a new settlement agreement was signed between the parties under which plaintiff agreed to accept two methods of repayment, the first being $1,200,000 paid over a fifteen month period commencing as soon as the Company was up to date with its filings and the balance of funding would come from a new asset based lending program that Defendants were in the process of arranging. The Company has provided for $2,330,453 in the financial statements that includes all interest and fees due to Plaintiff through June 30, 2014. 15. Global Vantage Ltd., a California Corporation vs Eran Engineering, Inc. Precision Aerospace and Technologies, Inc., M Line Holdings, Inc., Anthony Anish, Lawrence Consalvi and Kenneth Collini Plaintiff filed this complaint on August 7, 2014 in Orange County, California. The complaint alleges that defendants owe funds that are due for the lease of certain equipment or plaintiffs want repossession of the equipment. The plaintiffs obtained Judgments in February 2015 and the equipment has been returned to plaintiff. However, defendants are filing an appeal against this judgment. Litigation is subject to inherent uncertainties, and unfavorable rulings could occur. If an unfavorable ruling were to occur in any of the above matters, there could be a material adverse effect on our clients financial condition, results of operations or liquidity. |
Income Taxes
Income Taxes | 12 Months Ended |
Jun. 30, 2014 | |
Income Tax Disclosure [Abstract] | |
Income Taxes [Text Block] | 14. Income Taxes The provision (benefit) for income taxes is comprised of the following for the years ended June 30: Year ended Year ended June 30, June 30, 2014 2013 Current tax expense $ - $ - Federal - 360 State 1,894 2,770 Deferred - (16,710 ) $ 1,894 $ (13,580 ) The benefit for income taxes differs from the amount computed by applying the statutory federal income tax rate to income before provision for income taxes. The differences between the federal statutory tax rate of 34% and the effective tax rates are primarily due to state income tax provisions, net operating loss (NOL) carry forwards, deferred tax valuation allowance and permanent differences as follows for the years ended June 30: Year ended Year ended June 30, June 30, 2014 2013 Federal tax at statutory rate 34 % 34 % Permanent differences: State income tax, net of federal benefit 9 % 9 % Change in valuation allowance (28 )% (20 )% Other (15 )% (23 )% 0 % 0 % Deferred income taxes reflect the net tax effects of temporary differences between the carrying value of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Deferred tax assets at June 30, 2014 and 2013 consist of: Year ended Year ended 2014 2012 Deferred tax asset - current Allowances for bad debt $ 19,507 $ 12,666 Reserve for inventories 75,364 85,680 Accrued expenses 11,470 12,884 Other 15,390 15,390 $ 121,731 $ 126,620 Deferred tax assets-non-current Net operating loss carry forwards $ 3,381,274 $ 1,414,764 Depreciation 9,768 9,767 Amortization of intangibles 50,212 40,822 $ 3,441,254 $ 1,465,353 Total deferred tax asset $ 3,562,985 $ 1,591,973 Valuation allowance (3,562,985 ) (1,591,973 ) Net deferred tax asset $ - $ - The Companys income tax provision was computed based on the federal statutory rate and the average state statutory rates, net of the related federal benefit. As of June 30, 2014 and 2013 the Company had federal and state net operating loss (NOL) carry forwards of approximately $7.9 million and $7.7 million, respectively, net of Internal Revenue Code (IRC) Section 382 limitations. If not used, these carry forwards will begin expiring between 2012 and 2021. These net operating losses are available to offset future regular and alternative minimum taxable income. The Company has recorded as of June 30, 2014 a valuation allowance of approximately $2.7 million, as it believes that it is more likely than not that the deferred tax assets will not be realizable in future years. Management has based its assessment on available historical and projected operating results. |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Jun. 30, 2014 | |
Notes to Financial Statements [Abstract] | |
Shareholders' Equity [Text Block] | 15. Shareholders Equity The Companys articles of incorporation authorize up to 1,000,000,000 shares of $0.001 par value common stock. Shares of common or preferential stock may be issued in one or more classes or series at such time as the Board of Directors determine. The Companys articles of incorporation authorize up to 20,000,000 shares of $0.001 par value preferred stock. The Company designated 200,000 shares as Series A preferred shares. The Series A preferred shares are not entitled to dividends but are convertible to common shares. During the year ended June 30, 2013, the Company issued the following shares of common stock: ● 14,840,000 common shares were issued to financial advisors in payment of services to the company. The Company valued these shares at the market price on the issuance date in the sum of $467,942. ● The Company also issued 8,500,000 common shares in lieu of salaries and expenses due on behalf of related parties. The shares were valued at $168,700 based on the market price of the shares at the grant dates. During the year ended June 30, 2013, the Company issued 200,000 Series A Preferred shares to a lender in connection with the line of credit. During the year ended June 30, 2014, the Company issued the following shares of common stock: ● 12,805,130 shares were issued to financial advisors and other parties in payment of services to the Company. The Company valued the shares at the market price on the issuance dates in the sum of $67,451. ● 136,062,209 shares were issued to financial institutions in connection with the conversion of debt and accrued interest totaling $446,489. ● 5,100,000 shares were issued to a financial advisor in respect of consulting services provided to the Company. These shares were valued at market price on the issuance date in the sum of $40,290. The Company recognized a loss on settlement of $35,190. The Company also issued 6,000,000 shares in lieu of payroll and 13,000,000 shares to settle unpaid salaries due to officers. The shares were valued at $190,000 based on the market price of the shares at the grant date. During the year ended June 30, 2014, the company did not issue any Preferred shares. Non-Qualified Stock Option Plan In November 2006, the Board approved a Non-Qualified Stock Option Plan for key managers, which, among other provisions, provides for the granting of options by the board at strike prices at or exceeding market value, and expiration periods of up to ten years. No stock options have been granted under this plan. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Jun. 30, 2014 | |
Notes to Financial Statements [Abstract] | |
Fair Value of Financial Instruments [Text Block] | 16. Fair Value of Financial Instruments Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value maximize the use of observable inputs and minimize the use of unobservable inputs. The Company utilizes a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable. ● Level 1 - Quoted prices in active markets for identical assets or liabilities. These are typically obtained from real-time quotes for transactions in active exchange markets involving identical assets. ● Level 2 - Quoted prices for similar assets and liabilities in active markets; quoted prices included for identical or similar assets and liabilities that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. These are typically obtained from readily-available pricing sources for comparable instruments. ● Level 3 - Unobservable inputs, where there is little or no market activity for the asset or liability. These inputs reflect the reporting entitys own beliefs about the assumptions that market participants would use in pricing the asset or liability, based on the best information available in the circumstances. The following table presents the derivative financial instrument, the Companys only financial liability measured and recorded at fair value on the Companys consolidated balance sheets on a recurring basis and their level of hierarchy: As of June 30, 2014: Amount Level 1 Level 2 Level 3 Embedded conversion derivative liability $ 634,769 $ - $ - $ 634,769 Total $ 634,769 $ - $ - $ 634,769 As of June 30, 2013: Amount Level 1 Level 2 Level 3 Embedded conversion derivative liability $ - $ - $ - $ - Total $ - $ - $ - $ - The following table provides a summary of the changes in fair value, including net transfers in and/or out, of the derivative financial instruments, measured at fair value on a recurring basis using significant unobservable inputs: Balance at June 30, 2013 $ - Fair value of warrant derivative liabilities at issuance, recorded as debt discount 832,572 Settlement of derivative liabilities to additional paid in capital (1,144,321 ) Unrealized derivative loss included in other expense 946,518 Balance at June 30, 2014 $ 634,769 The fair value of the derivative liability is calculated at the time of issuance and the Company records a derivative liability for the calculated value. Changes in the fair value of the derivative liability are recorded in other income (expense) in the consolidated statements of operations. The following are the assumptions used for derivative instrument valued using the Black Scholes option pricing model: At Issuance June 30, 2014 50% of the market value of stock on measurement date $ 0.01 - 0.03 $ 0.04 - 0.025 Risk-free interest rate 0.07 - 0.13 % 0.07 0.44 % Dividend yield 0 % 0 % Volatility factor 256 - 343 % 255 -334 % Term 0.26 - 2 years 0.25 1.9 years |
Segments and Geographic Informa
Segments and Geographic Information | 12 Months Ended |
Jun. 30, 2014 | |
Notes to Financial Statements [Abstract] | |
Segments and Geographic Information [Text Block] | 17. Segments and Geographic Information The Companys segments consist of individual companies managed separately with each manager reporting to the Board. Other represents corporate functions. Sales, and operating or segment profit, are reflected net of inter-segment sales and profits. Segment profit is comprised of net sales less operating expenses and interest. Income taxes are not allocated and reported by segment since they are excluded from the measure of segment performance reviewed by management. Segment information is as follows as of and for the year ended June 30, 2014: Segment Information for the year ended Machine Sales Precision Corporate Total Revenue $ 6,593,151 $ 2,106,971 $ 1,000 $ 8,701,122 Interest expense 158,718 270,615 1,454,672 1,884,005 Depreciation and amortization 1,500 160,579 - 162,079 Loss before taxes (636,758 ) (1,028,070 ) (3,364,064 ) (5,028,892 ) Total assets 374,911 1,783,300 85,138 2,243,349 Capital expenditures $ - $ 8,000 $ - $ 8,000 Segment Information for the year ended Machine Sales Precision Corporate Total Revenue $ 5,810,909 $ 3,513,776 $ - $ 9,324,685 Interest expense 44,913 266,400 186,052 497,365 Depreciation and amortization 3,000 166,745 3,787 173,532 Loss before taxes (55,673 ) (1,361,221 ) (2,989,954 ) (4,406,848 ) Total assets 1,077,202 2,384,185 235,702 3,697,089 Capital expenditures $ - $ 19,335 $ - $ 19,335 At June 30, 2014 the 2,100,000 shares of common stock of OR Holdings, Inc. held by M Line Holdings, Inc. was traded on the GXG Stock exchange in Europe. At that date the market value of the shares was $1.00 (.70 Euros) per share. However, since that date, OR Holdings, Inc. suspended its trading in advance of a move to Marche Libre Stock Exchange in Europe and the new listing has not been completed as yet. As a result revenue from financial services provided by M Line was reduced to a notional value of $1,000. Sales are derived principally from customers located within the United States Long-lived assets consist of property and equipment that are located within the United States. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Jun. 30, 2014 | |
Notes to Financial Statements [Abstract] | |
Subsequent Events [Text Block] | a. On July 1, 2014, the Company moved its corporate office and its precision manufacturing facility to our new facility at 2320 E Orangethorpe Avenue, Anaheim, CA 92806. The Companys new lease is for a period from July 1, 2015 until August 31, 2024, The rent commenced at $23,353 per month and increases annually. The Company has an option for a ten year extension of the lease on final terms to be agreed. b. On January 15 2015, the effective date, the Company entered into a settlement agreement with TCA. Under the terms of the agreement, TCA will receive $100,000 as soon as all the Companys filings are current and will then receive $80,000 per month for 13 months and $60,000 in the 15 th c. Since July 1, 2014 the Company has converted notes and unpaid interest totalling $306,977 to 668,818,367 common shares. d. Since July 1, 2014 the Company has raised funds through a 10% convertible note for $330,000 of which $257,000 has been funded. The note is convertible at the lower of $0.001 or 50% of the lowest trading price of the Companys common stock during the 20 consecutive trading days prior to the date of conversion. e. In October 2014, M Line Holdings, Inc. formed a new wholly owned subsidiary, M Line Machinery Funding, Inc. This Company which has not traded to date, will be used for machinery finance and also for any other financial services provided by the Company to prospective customers. The name has been changed to M Line Financial Services, Inc. f. On March 3, 2015, a total of 200,000,000 shares were issued to two officers in lieu of payroll g. On October 14, 2014, the Company issued to one of its officers 10 million shares of its blank check preferred stock (designated as Series A Preferred Stock) which are non-convertible, zero dividend and zero interest and carry a voting power equivalent to 50% of the Companys outstanding common and preferred stock. |
Summary of Significant Accounti
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Jun. 30, 2014 | |
Notes to Financial Statements [Abstract] | |
Basis of Presentation [Policy Text Block] | Basis of Presentation The accompanying financial statements are prepared in accordance with accounting principles generally accepted in the United States of America. |
Principles of consolidation [Policy Text Block] | Principles of Consolidation The accompanying consolidated financial statements include the accounts of M Line Holdings, Inc. and its wholly-owned subsidiaries: Elite and Precision. All intercompany accounts and transactions have been eliminated. |
Business Segments [Policy Text Block] | Business Segments FASB ASC Topic 280: Segment Reporting |
Concentrations of Credit Risks [Policy Text Block] | Concentrations of Credit Risks Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash and cash equivalents and trade accounts receivable. The Company invests its cash balances through high-credit quality financial institutions. From time to time, the Company maintains bank account levels in excess of FDIC insurance limits. If the financial institutions in which the Company has its accounts have financial difficulties, the Companys cash balances could be at risk. Sales from significant customers representing 10% or more of sales consist of the following customers for the years ended June 30: Year ended Year ended June Percent of sales 18.00 16.76 Number of customers 2 1 As a result of the Companys concentration of its customer base and industries served, the loss or cancellation of business from, or significant changes in scheduled deliveries of product sold to the above customers or a change in their financial position could materially and adversely affect the Companys consolidated financial position, results of operations and cash flows. Two customers, included in the Precision Manufacturing segment represents a significant concentration. Sales to these customers as a percentage of sales within the Precision Manufacturing Segment are as follows for the years ended June 30: Year ended June 30, 2014 2013 % of segment sales significant customer sales concentration 76 45 Accounts receivable from these customers at June 30, 2014 and 2013 were $84,174 and $254,757 respectively. The Companys Precision Manufacturing segment operated a single manufacturing facility located in Tustin, California. The company has moved its location to a facility in Anaheim, California. on July 1, 2014. A major interruption in the manufacturing operations at this facility would have a material adverse effect on the consolidated financial position and results of operations of the Company. |
Use of Estimates [Policy Text Block] | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities and the reported amounts of sales and expenses during the reporting period. Significant estimates made by management are, among others, realization of inventories, collectability of accounts receivable, litigation, impairment of goodwill, and long-lived assets other than goodwill. Actual results could materially differ from those estimates. |
Cash and Cash Equivalents [Policy Text Block] | Cash and Cash Equivalents The Company considers all highly liquid investments with insignificant interest rate risk and original maturities of three months or less from the date of purchase to be cash equivalents. The carrying amounts of cash and cash equivalents approximate their fair values. The Company maintains cash and cash equivalents balances at certain financial institutions in excess of amounts insured by federal agencies. Management does not believe that as a result of this concentration, it is subject to any unusual financial risk beyond the normal risk associated with commercial banking relationships. |
Accounts Receivable [Policy Text Block] | Accounts Receivable The Company performs periodic credit evaluations and continually monitors its collection of amounts due from its customers. The Company adjusts credit limits and payment terms granted to its customers based upon payment history and the customer's current creditworthiness. The Company does not require collateral from its customers to secure amounts due from them. The Company regularly reviews its accounts receivable and collection of these balances subsequent to each of these periods. The Company maintains reserves for potential credit losses, and historically, such losses have been within managment expectations. As of June 30, 2014 and 2013, accounts receivable totals were $2,321,344 and $990,010 net of an allowance for bad debt expense of $45,534 and $29,566 respectively. |
Inventories [Policy Text Block] | Inventories Inventories are stated at the lower of cost or market, cost being determined using the first in, first out (FIFO) method. The Company provides inventory reserves for obsolescence and other matters based on managements review of current inventory levels. The Company includes labor and overhead costs directly associated with manufacturing its products in inventory costs. |
Deferred financing fees [Policy Text Block] | Deferred financing fees The Company incurs costs in connection with its line of credit which may consist of legal, finders and due diligence fees. Such costs are deferred and amortized to interest expense over the term of the line of credit. Amortization of deferred financing fees for the years ended June 30, 2014 and 2013 amounted to $199,516 and $99,758, respectively. |
Property and Equipment [Policy Text Block] | Property and Equipment Property and equipment is stated at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets. Equipment under capital lease obligations is depreciated over the estimated useful life of the asset. Leasehold improvements are amortized over the shorter of the estimated useful life or the term of the lease. Repairs and maintenance are expensed as incurred, while improvements are capitalized. Upon the sale or retirement of property and equipment, the accounts are relieved of the cost and the related accumulated depreciation, which any resulting gain or loss included in the consolidated statements of operations. |
Long-Lived Assets [Policy Text Block] | Long-Lived Assets The Company reviews its fixed assets and certain identifiable intangibles with definite lives for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted operating cash flow expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset exceeds the fair value of the asset or discounted cash flows. Long-lived assets to be disposed of are reported at the lower of carrying amount or fair value less costs to sell. Based on managements review, the Company determined that there was no impairment to its long-lived assets for the years ended June 30, 2014 and 2013. |
Income Taxes [Policy Text Block] | Income Taxes The Company accounts for income taxes in accordance with FASB ASC Topic 740-10, Income Taxes The Company accounts for uncertain tax positions in accordance with ASC 740, which prescribes a recognition threshold and measurement attribute for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return and also provides guidance on various related matters such as de-recognition, interest, penalties and disclosures required. The Company recognizes interest and penalties, if any, related to unrecognized tax benefits in income tax expense. |
Contingencies and Litigation [Policy Text Block] | Contingencies and Litigation The Company evaluates contingent liabilities including threatened or pending litigation. |
Revenue Recognition [Policy Text Block] | Revenue Recognition The Company recognizes revenue in accordance with Staff Accounting Bulletin No. 104 Revenue Recognition. Revenue is recognized at the date of shipment to customers when; a formal arrangement exists, the price is fixed or determinable, the delivery is completed, no other significant obligations of the Company exist, and collectability is reasonably assured. Revenues generated from the Precision Manufacturing segment consist of manufactured parts and in some instances, assembly of these items based on detailed engineering specifications received by the Company from the customer. The Company generally begins to manufacture the parts upon the receipt and acceptance of a purchase order which specifies the quantity, price and delivery dates such products are required to be shipped within. Prior to shipment, physical inspection of the parts is performed to ensure specifications meet the engineering requirements. Historically, customer returns have been inconsequential. Revenues generated from the sales of new and pre-owned Computer Numerically Controlled machines from the Machine Tools segment are based on the acceptance of a purchase order and the customers acknowledgement of the Companys terms and conditions which specifies the shipping terms, payment terms and the warranty period, if any. In certain instances, the Company may perform installation services including the leveling of the machine, which is inconsequential. Under agreements with certain new equipment manufacturers, a ninety day warranty is provided to customers whereby the manufacturer is responsible for any replacement parts and the Company is responsible for the installation of the parts. In certain instances, the Company provides warranties for used equipment for periods ranging up to thirty days. Historically, warranty costs have been inconsequential. Generally, the Company does not accept returns of equipment. Warranty expense, included in cost of sales, for the years ended June 30, 2014 and 2013 amounted to $96,955 and $68,364, respectively. Payments received before all of the relevant criteria for revenue recognition are satisfied are recorded as customer deposits. Revenues generated from financial services are recognized at the time the services are performed. revenues generated by M Line Holdings, inc. consist of the following services including, financial advice, raising new capital, advice and support in relation to new stock listings, reverse mergers etc. and where applicable sales support. |
Cost of Sales, Policy [Policy Text Block] | Cost of Goods Sold The Company includes the following in cost of goods sold; materials, production labor, tooling, depreciation, outside services and an apportionment of S.G & A. |
Advertising [Policy Text Block] | Advertising The Company expenses the cost of advertising when incurred as selling expenses. Advertising expenses were $6,266 and $17,901, for the years ended June 30, 2014 and 2013, respectively. |
Stock-Based Compensation [Policy Text Block] | Stock-Based Compensation The Company accounts for share-based awards issued to employees in accordance with FASB ASC 718. Accordingly, employee share-based payment compensation is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the requisite service period or vesting period. Additionally, share-based awards to non-employees are expensed over the period in which the related services are rendered at their fair value. The Company accounts for share based awards issued to non-employees in accordance with FASB ASC 505. This requires us to estimate the value of securities used for compensation and to charge such amounts to expense over the periods benefited. The estimated fair value at the date of the award of options or warrants for our common stock is estimated using the Blach-Scholes pricing model as follows: Expected volatility is based on the historical volitility of our stock. the risk free interest rate is based on the US Treasury constant maturity rates as of the grant date. The expected life of the option is based on historical exercise behaviour and expected future experience. |
Net Loss per Share [Policy Text Block] | Net Loss per Share Basic net loss per share is calculated by dividing net loss by the Companys weighted average common shares outstanding during the period. Diluted net income per share reflects the potential dilution to basic earnings per share that could occur upon conversion or exercise of securities, options or other such items to common shares using the treasury stock method, based upon the Companys weighted average fair value of the common shares during the period. For each period presented, basic and diluted net loss per share amounts are identical as the Company does not have potentially dilutive securities. |
Fair Value of Financial Instruments [Policy Text Block] | Fair Value of Financial Instruments The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents, accounts receivable, accounts payable, accrued expenses, line of credit and notes payable approximates fair value due to the immediate or short-term maturity of these financial instruments. The fair value of long-term notes approximates the carrying amounts based upon the expected borrowing rate for debt with similar remaining maturities and comparable risk. |
Reclassification [Policy Text Block] | Reclassification Certain reclassification has been made to the previous years financial statements to conform to current year presentation with no effect on previously reported net loss. |
Recent Accounting Pronouncements [Policy Text Block] | Recent Accounting Pronouncements The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new pronouncements that have been issued that might have a material impact on its financial position or results of operations. |
Basis of Presentation and Sig26
Basis of Presentation and Significant Accounting Policies (Tables) | 12 Months Ended |
Jun. 30, 2014 | |
Basis Of Presentation And Significant Accounting Policies Tables | |
Concentrations of Credit Risks [Table Text Block] | Sales from significant customers representing 10% or more of sales consist of the following customers for the years ended June 30: Year ended Year ended June Percent of sales 18.00 16.76 Number of customers 2 1 Sales to these customers as a percentage of sales within the Precision Manufacturing Segment are as follows for the years ended June 30: Year ended June 30, 2014 2013 % of segment sales significant customer sales concentration 76 45 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Jun. 30, 2014 | |
Notes to Financial Statements [Abstract] | |
Inventories [Table Text Block] | Inventories consist of the following at June 30: June 30, 2014 June 30, 2013 Finished goods and components $ 1,112,647 $ 971,099 CNC machines held for sale 152,000 364,583 Work in progress 327,620 415,108 Raw materials and parts 14,336 5,120 1,606,603 1,755,910 Less: Reserve for inventories (175,921 ) (200,000 ) $ 1,430,682 $ 1,555,910 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Jun. 30, 2014 | |
Property And Equipment Tables | |
Property and Equipment [Table Text Block] | Property and equipment consists of the following at June 30: Estimated 2014 2013 Machinery and equipment 7 $ 2,440,562 $ 2,603,313 Fixtures, Fixtures and office equipment 3 to 5 345,682 341,308 Vehicles 5 23,276 23,276 Leasehold improvements 3 105,298 105,298 Total 2,914,818 3,073,195 Less accumulated depreciation 2,512,342 2,516,640 $ 402,476 $ 556,555 |
Accrued Expenses and Other (Tab
Accrued Expenses and Other (Tables) | 12 Months Ended |
Jun. 30, 2014 | |
Notes to Financial Statements [Abstract] | |
Accrued Expenses and Other [Table Text Block] | Accrued expenses and other consist of the following at June 30: June 30, 2014 June 30, 2013 Compensation and related benefits $ 2,023,064 $ 1,934,314 Audit fees 46,000 72,500 Other 525,552 781,883 $ 2,594,616 $ 2,788,697 |
Capital Leases (Tables)
Capital Leases (Tables) | 12 Months Ended |
Jun. 30, 2014 | |
Notes to Financial Statements [Abstract] | |
Future Annual Minimum Lease Payments [Table Text Block] | The Company leases certain equipment under capital leases with terms ranging from four to five years. Future annual minimum lease payments are as follows as of June 30: June 30, 2014 June 30, 2013 2014 $ 53,901 $ 54,501 2015 46,426 54,501 2016 - 36,241 2017 - - Total minimum lease payments 100,327 145,243 Less amount representing interest - - Present value of future minimum lease payments 100,327 145,243 Less current portion of capital lease obligations (53,901 ) (54,501 ) Capital lease obligations, net of current portion $ 46,426 $ 90,742 |
Notes Payable (Tables)
Notes Payable (Tables) | 12 Months Ended |
Jun. 30, 2014 | |
Notes to Financial Statements [Abstract] | |
Notes Payable [Table Text Block] | Notes payable as of June 30 consist of: June 30, June 30, 2014 2013 Notes payable to a financial institution, secured by the underlying equipment in aggregate monthly installments of varying amounts, on a reducing balance method, with the balance due in October 2016. $ 247,811 $ 422,940 An unsecured note payable to a corporation in respect of accounting software payable in monthly installments of $ 1,923. This note was disputed and was written off in the absence of any collection activity for over four years. - 46,811 One unsecured 5% convertible notes payable to a financial institution due March 4, 2015 110,000 - An unsecured 12% convertible note payable to a financial institution due February 12, 2016 50,631 - An unsecured 12% convertible note payable to a financial institution due January 31, 2015 21,500 - Two unsecured 8% convertible notes payable in the sum of $110,751, to a financial institution due February 12, 2015 50,000 - Two unsecured notes payable in the sum of $150,000, each, to a financial institution due in full in November 2011 and March 31, 2012. The Company is currently in default and has negotiated to pay the notes in monthly installments of $20,000 commencing November 2012. 75,459 354,459 Two unsecured 8% convertible notes payable in the sum of $110,674 to a financial institution with $50,000 due on February 6, 2015 and $55,674 due on May 30, 2015 105,674 - Three unsecured 8% convertible notes payable in the sum of $160,674 each, to a financial institution with $50,000 due on February 6, 2015 and $110,674 due on June 10, 2015 160,674 - Three unsecured 8% convertible notes payable to a financial institution $50,000 due April 25, 2015, $75,000 due on December 25, 2015 and $125,662 due October 3, 2015 225,562 - Two unsecured 8% convertible notes payable to a financial institution both due May 30, 2015 160,674 - An unsecured 8% convertible note payable to a financial institution on due June 10, 2015 50,000 - An unsecured note payable to a corporation in weekday amounts of $700, increasing to $1,650, in September 2013 and ending in December 2013. This note is in default but a settlement reached with monthly payments being made will pay off the note by June 25, 2015 40,300 125,600 An unsecured note payable to a corporation in weekday amounts of $691 each, through December 2013. This note is in default but a settlement reached with monthly payments being made will pay off this note by October 15, 2015 57,120 115,050 An unsecured note payable to a corporation in weekday amounts of $841 each, through February 2014. This note is in default. 105,350 - Less Debt Discount (317,977 ) (69,996 ) TOTAL 1,142,778 994,864 Less - Current Portion 1,018,755 675,961 Long Term Portion $ 124,023 $ 318,903 2015 124,023 123,780 2016 - 123,780 2017 - 71,343 2018 - - Thereafter - - 124,023 318,903 |
Litigation Payable (Tables)
Litigation Payable (Tables) | 12 Months Ended |
Jun. 30, 2014 | |
Litigation Payable Tables | |
Litigation Settlements Payable [Table Text Block] | June 30,2014 June 30,2013 An unsecured note payable to a corporation in settlement of a lawsuit payable in 12 monthly payments of $5,000. $ 210,000 60,000 Unsecured notes payable to various parties in settlement of lawsuits payable in full. 77,500 77,500 $ 287,500 137,500 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Jun. 30, 2014 | |
Commitments And Contingencies Tables | |
Future Rent Under Lease Agreements [Table Text Block] | Future rent under lease agreements for the next five years are as follows: 2015 233,530 2016 287,242 2017 295,859 2018 304,735 2019 313,877 Thereafter 1,777,349 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jun. 30, 2014 | |
Income Taxes Tables | |
Provision (Benefit) For Income Taxes [Table Text Block] | The provision (benefit) for income taxes is comprised of the following for the years ended June 30: Year ended Year ended June 30, June 30, 2014 2013 Current tax expense $ - $ - Federal - 360 State 1,894 2,770 Deferred - (16,710 ) $ 1,894 $ (13,580 ) |
Income Tax Rate Reconciliation [Table Text Block] | The differences between the federal statutory tax rate of 34% and the effective tax rates are primarily due to state income tax provisions, net operating loss (NOL) carry forwards, deferred tax valuation allowance and permanent differences as follows for the years ended June 30: Year ended Year ended June 30, June 30, 2014 2013 Federal tax at statutory rate 34 % 34 % Permanent differences: State income tax, net of federal benefit 9 % 9 % Change in valuation allowance (28 )% (20 )% Other (15 )% (23 )% 0 % 0 % |
Deferred Tax Assets and Liabilties [Table Text Block] | Deferred income taxes reflect the net tax effects of temporary differences between the carrying value of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Deferred tax assets at June 30, 2014 and 2013 consist of: Year ended Year ended 2014 2012 Deferred tax asset - current Allowances for bad debt $ 19,507 $ 12,666 Reserve for inventories 75,364 85,680 Accrued expenses 11,470 12,884 Other 15,390 15,390 $ 121,731 $ 126,620 Deferred tax assets-non-current Net operating loss carry forwards $ 3,381,274 $ 1,414,764 Depreciation 9,768 9,767 Amortization of intangibles 50,212 40,822 $ 3,441,254 $ 1,465,353 Total deferred tax asset $ 3,562,985 $ 1,591,973 Valuation allowance (3,562,985 ) (1,591,973 ) Net deferred tax asset $ - $ - |
Fair Value of Financial Instr35
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Jun. 30, 2014 | |
Notes to Financial Statements [Abstract] | |
Financial Liability Measured and Recorded at Fair Value on Recurring Basis [Table Text Block] | The following table presents the derivative financial instrument, the Companys only financial liability measured and recorded at fair value on the Companys consolidated balance sheets on a recurring basis and their level of hierarchy: As of June 30, 2014: Amount Level 1 Level 2 Level 3 Embedded conversion derivative liability $ 634,769 $ - $ - $ 634,769 Total $ 634,769 $ - $ - $ 634,769 As of June 30, 2013: Amount Level 1 Level 2 Level 3 Embedded conversion derivative liability $ - $ - $ - $ - Total $ - $ - $ - $ - |
Summary of Changes in Fair Value [Table Text Block] | The following table provides a summary of the changes in fair value, including net transfers in and/or out, of the derivative financial instruments, measured at fair value on a recurring basis using significant unobservable inputs: Balance at June 30, 2013 $ - Fair value of warrant derivative liabilities at issuance, recorded as debt discount 832,572 Settlement of derivative liabilities to additional paid in capital (1,144,321 ) Unrealized derivative loss included in other expense 946,518 Balance at June 30, 2014 $ 634,769 |
Assumptions Used for Derivative Instrument [Table Text Block] | The following are the assumptions used for derivative instrument valued using the Black Scholes option pricing model: At Issuance June 30, 2014 50% of the market value of stock on measurement date $ 0.01 - 0.03 $ 0.04 - 0.025 Risk-free interest rate 0.07 - 0.13 % 0.07 0.44 % Dividend yield 0 % 0 % Volatility factor 256 - 343 % 255 -334 % Term 0.26 - 2 years 0.25 1.9 years |
Segments and Geographic Infor36
Segments and Geographic Information (Tables) | 12 Months Ended |
Jun. 30, 2014 | |
Notes to Financial Statements [Abstract] | |
Segment Information [Table Text Block] | Segment information is as follows as of and for the year ended June 30, 2014: Segment Information for the year ended Machine Sales Precision Corporate Total Revenue $ 6,593,151 $ 2,106,971 $ 1,000 $ 8,701,122 Interest expense 158,718 270,615 1,454,672 1,884,005 Depreciation and amortization 1,500 160,579 - 162,079 Loss before taxes (636,758 ) (1,028,070 ) (3,364,064 ) (5,028,892 ) Total assets 374,911 1,783,300 85,138 2,243,349 Capital expenditures $ - $ 8,000 $ - $ 8,000 Segment Information for the year ended Machine Sales Precision Corporate Total Revenue $ 5,810,909 $ 3,513,776 $ - $ 9,324,685 Interest expense 44,913 266,400 186,052 497,365 Depreciation and amortization 3,000 166,745 3,787 173,532 Loss before taxes (55,673 ) (1,361,221 ) (2,989,954 ) (4,406,848 ) Total assets 1,077,202 2,384,185 235,702 3,697,089 Capital expenditures $ - $ 19,335 $ - $ 19,335 |
Basis of Presentation and Sig37
Basis of Presentation and Significant Accounting Policies - Concentrations of Credit Risk (Details) | 12 Months Ended | |
Jun. 30, 2014 | Jun. 30, 2013 | |
Percent of sales | 18.00% | 16.76% |
Number of customers | 2 | 1 |
Precision Manufacturing segment [Member] | ||
Percent of sales | 76.00% | 45.00% |
Basis of Presentation and Sig38
Basis of Presentation and Significant Accounting Policies (Details Narrative) - USD ($) | 12 Months Ended | |
Jun. 30, 2014 | Jun. 30, 2013 | |
Accounts Receivable, Net | $ 2,321,344 | $ 990,010 |
Bad Debt Expense | 45,534 | 29,566 |
Amortization of Deferred Financing Costs | 199,516 | 99,758 |
Product Warranty Expense | 96,955 | 68,364 |
Advertising Expenses | 6,266 | 17,901 |
Precision Manufacturing segment [Member] | ||
Accounts Receivable, Credit Risk | $ 84,174 | $ 254,757 |
Going Concern and Management 39
Going Concern and Management Plans (Details Narrative) - USD ($) | Jun. 30, 2014 | Jun. 30, 2013 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accumulated Deficit | $ 19,473,263 | $ 14,444,371 |
Outstanding amount | $ 1,200,000 |
Inventories - Inventories (Deta
Inventories - Inventories (Details) - USD ($) | Jun. 30, 2014 | Jun. 30, 2013 |
Inventory Disclosure [Abstract] | ||
Finished goods and components | $ 1,112,647 | $ 971,099 |
CNC machines held for sale | 152,000 | 364,583 |
Work in progress | 327,620 | 415,108 |
Raw materials and parts | 14,336 | 5,120 |
Inventory, gross | 1,606,603 | 1,755,910 |
Less: Reserve for inventories | (175,921) | (200,000) |
Inventories, net | $ 1,430,682 | $ 1,555,910 |
Related Parties (Details Narrat
Related Parties (Details Narrative) - USD ($) | 12 Months Ended | |
Jun. 30, 2014 | Jun. 30, 2013 | |
Related Party Transactions [Abstract] | ||
Due From Related Parties | $ 99,348 | |
Due to Officers | $ 35,954 | $ 43,454 |
Waiver of officers' salaries | $ 390,000 |
Property and Equipment - Proper
Property and Equipment - Property and Equipment (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2014 | Jun. 30, 2013 | |
Property, Plant and Equipment, Gross | $ 2,914,818 | $ 3,073,195 |
Less accumulated depreciation | 2,512,342 | 2,516,640 |
Property, Plant and Equipment, Net | 402,476 | 556,555 |
Machinery and equipment [Member] | ||
Property, Plant and Equipment, Gross | $ 2,440,562 | 2,603,313 |
Property Plant and Equipment Useful Life | 7 years | |
Fixtures, Fixtures and office equipment [Member] | ||
Property, Plant and Equipment, Gross | $ 345,682 | 341,308 |
Fixtures, Fixtures and office equipment [Member] | Minimum [Member] | ||
Property Plant and Equipment Useful Life | 3 years | |
Fixtures, Fixtures and office equipment [Member] | Maximum [Member] | ||
Property Plant and Equipment Useful Life | 5 years | |
Vehicles [Member] | ||
Property, Plant and Equipment, Gross | $ 23,276 | 23,276 |
Property Plant and Equipment Useful Life | 5 years | |
Leasehold improvements [Member] | ||
Property, Plant and Equipment, Gross | $ 105,298 | $ 105,298 |
Property Plant and Equipment Useful Life | 3 years |
Property and Equipment (Details
Property and Equipment (Details Narrative) - USD ($) | 12 Months Ended | |
Jun. 30, 2014 | Jun. 30, 2013 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation Expense | $ 162,079 | $ 173,532 |
Accrued Expenses and Other - Ac
Accrued Expenses and Other - Accrued Expenses (Details) - USD ($) | Jun. 30, 2014 | Jun. 30, 2013 |
Other Income and Expenses [Abstract] | ||
Compensation and related benefits | $ 2,023,064 | $ 1,934,314 |
Audit fees | 46,000 | 72,500 |
Other | 525,552 | 781,883 |
Accrued Liabilities and Other Liabilities | $ 2,594,616 | $ 2,788,697 |
Capital Leases - Future Minimum
Capital Leases - Future Minimum Lease Payments for Capital Leases (Details) - USD ($) | Jun. 30, 2014 | Jun. 30, 2013 |
Debt Disclosure [Abstract] | ||
2,014 | $ 53,901 | $ 54,501 |
2,015 | $ 46,426 | 54,501 |
2,016 | $ 36,241 | |
2,017 | ||
Total minimum lease payments | $ 100,327 | $ 145,243 |
Less amount representing interest | ||
Present value of future minimum lease payments | $ 100,327 | $ 145,243 |
Less current portion of capital lease obligations | (53,901) | (54,501) |
Capital Lease obligations, net of current portion | $ 46,426 | $ 90,742 |
Line of Credit (Details Narrati
Line of Credit (Details Narrative) - USD ($) | 12 Months Ended | |
Jun. 30, 2014 | Apr. 30, 2013 | |
Principal Amount Owed, Main Credit | $ 0 | |
Line of Credit, Amount Drawn | 1,700,000 | |
Line of Credit, Amount Outstanding | 2,330,453 | |
TCA [Member] | ||
Line of Credit, Amount Outstanding | $ 10,000,000 | |
Repayment of debt | $ 1,200,000 | |
Debt repayment period | 15 months |
Note Payable - Notes Payable (D
Note Payable - Notes Payable (Details) - USD ($) | Jun. 30, 2014 | Jun. 30, 2013 |
TOTAL | $ 1,142,778 | $ 994,864 |
Less: Current Portion | 1,018,755 | 675,961 |
Long Term Portion | 124,023 | 318,903 |
2,015 | $ 124,023 | 123,780 |
2,016 | 123,780 | |
2,017 | $ 71,343 | |
2,018 | ||
Thereafter | ||
Long Term Debt Maturities Repayements | $ 124,023 | $ 318,903 |
Notes Payable to Financial Institution | ||
TOTAL | $ 247,811 | 422,940 |
Unsecured Note Payable to Corporation, Software | ||
TOTAL | $ 46,811 | |
Unsecured 8% convertible note payable to financial institution [Member] | ||
TOTAL | $ 110,000 | |
Unsecured 12% convertible note payable to financial institution 1 [Member] | ||
TOTAL | 50,631 | |
Unsecured 8% convertible note payable to financial institution 2 [Member] | ||
TOTAL | 21,500 | |
Two unsecured 8% convertible note payable to financial institution [Member] | ||
TOTAL | 50,000 | |
Two Unsecured Notes Payalbe to Financial Institutions | ||
TOTAL | 75,459 | $ 354,459 |
Two unsecured 8% convertible note payable to financial institution 1 [Member] | ||
TOTAL | 105,674 | |
Three unsecured 8% convertible note payable to financial institution 2 [Member] | ||
TOTAL | 160,674 | |
Three unsecured 8% convertible note payable to a financial institution [Member] | ||
TOTAL | 225,562 | |
Unsecured 8% convertible note payable to financial institution 3 [Member] | ||
TOTAL | 160,674 | |
Unsecured 8% convertible note payable to financial institution 4 [Member] | ||
TOTAL | 50,000 | |
Unsecured Note Corporation 1 [Member] | ||
TOTAL | 40,300 | $ 125,600 |
Unsecured Note Corporation 2 [Member] | ||
TOTAL | 57,120 | 115,050 |
Unsecured Note Corporation 3 [Member] | ||
TOTAL | 105,350 | 0 |
Less Discount [Member] | ||
TOTAL | $ (317,977) | $ (69,996) |
Unsecured 8% convertible note payable to financial institution 1 [Member] | ||
TOTAL |
Notes Payable (Details Narrativ
Notes Payable (Details Narrative) - Jun. 30, 2014 - USD ($) | Total |
Notes to Financial Statements [Abstract] | |
Obligation to issue warrants for common stock | 17,000,000 |
Exercise price of warrants | $ 0.003 |
Debt discount and amortized | $ 54,400 |
Warrants Term | 5 years |
Litigation Payable - Litigation
Litigation Payable - Litigation Settlements Payable (Details) - USD ($) | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 16, 2011 |
Litigation payable | $ 287,500 | $ 137,500 | |
Unsecured note payable to corporation settlement of lawsuit payable [Member] | |||
Litigation payable | 210,000 | 60,000 | $ 210,000 |
Unsecured Note Various Parties [Member] | |||
Litigation payable | $ 77,500 | $ 77,500 |
Commitments and Contingencies -
Commitments and Contingencies - Future Rent Under Lease Agreements (Details) | Jun. 30, 2014USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,015 | $ 233,530 |
2,016 | 287,242 |
2,017 | 295,859 |
2,018 | 304,735 |
Thereafter | 313,877 |
Total | $ 1,777,349 |
Commitments and Contingencies51
Commitments and Contingencies (Details Narrative) - USD ($) | 12 Months Ended | |
Jun. 30, 2014 | Jun. 30, 2013 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Rent Expense | $ 545,177 | $ 460,565 |
Litigation (Details Narrative)
Litigation (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | ||||
Dec. 31, 2013 | Nov. 30, 2013 | Oct. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 02, 2015 | |
Litigation payable | $ 287,500 | $ 137,500 | ||||
Subramani Srinivasan, et al. v. M Line Holdings, Inc [Member] | ||||||
Loss Contingency, Settlement Agreement, Date | January 22, 2015 | |||||
Loss Contingency Settlement Agreement Periodic Payments | $ 20,000 | |||||
Subramani Srinivasan, et al. v. M Line Holdings, Inc [Member] | Subsequent Event [Member] | ||||||
Litigation payable | $ 20,000 | |||||
Can Capital Asset Servicing, Inc. v. E.M. Tool Company, Inc [Member] | ||||||
Loss Contingency, Settlement Agreement, Date | May 15, 2015 | |||||
Loss Contingency Settlement Agreement Consideration 1 | $ 58,313 | |||||
Loss Contingency Settlement Agreement Periodic Payments | 50,000 | |||||
Loss Contingency Accrual, Carrying Value, Payments | 25,500 | |||||
Loss Contingency Accrual, Carrying Value, Provision | $ 10,000 | |||||
Fadal Machining V. All American Cnc Sales, Et Al., [Member] | ||||||
Loss Contingency Accrual, Carrying Value, Provision | $ 60,000 | |||||
Alu Forge v Jitu Banker | ||||||
Loss Contingency Settlement Agreement Periodic Payments | $ 9,000 | $ 5,250 | $ 5,250 | |||
TCA Global Credit Master Fund, L.P [Member] | ||||||
Loss Contingency, Lawsuit Filing Date | July 1, 2014 | |||||
Loss Contingency, Settlement Agreement, Date | September 5, 2014 | |||||
Loss Contingency Settlement Agreement Periodic Payments | $ 1,200,000 | |||||
Loss Contingency Accrual, Carrying Value, Payments | $ 2,330,453 | |||||
Global Vantage Ltd [Member] | ||||||
Loss Contingency, Lawsuit Filing Date | August 7, 2014 | |||||
James M. Cassidy V. Gateway International Holdings, Inc [Member] | ||||||
Loss Contingency, Lawsuit Filing Date | September 16, 2008 | |||||
Loss Contingency, Damages Sought, Value | $ 195,000 | |||||
Cnc Manufacturing V. All American Cnc Sales, Inc., [Member] | ||||||
Loss Contingency, Lawsuit Filing Date | October 2, 2008 | |||||
Loss Contingency, Damages Sought, Value | $ 138,750 | |||||
Loss Contingency Damages Awarded Value | $ 37,500 | |||||
Loss Contingency, Settlement Agreement, Date | June 30, 2014 | |||||
Donald Yu v M Line Holdings | ||||||
Loss Contingency Damages Awarded Value | $ 24,000 | |||||
Loss Contingency, Settlement Agreement, Date | September 30, 2013 | |||||
Loss Contingency Settlement Agreement Consideration 1 | $ 21,450 | |||||
Loss Contingency Settlement Agreement Periodic Payments | 12,000 | |||||
Loss Contingency Damages Paid Value | $ 12,000 | |||||
Fadal Machining V. All American Cnc Sales, Et Al., [Member] | ||||||
Loss Contingency, Lawsuit Filing Date | June 12, 2009 | |||||
Loss Contingency, Damages Sought, Value | $ 163,579 | |||||
Loss Contingency, Settlement Agreement, Date | May 31, 2011 | |||||
Loss Contingency, Settlement Agreement, Terms | A settlement agreement in the amount of $60,000 was signed on May 31, 2011. | |||||
Loss Contingency Accrual, Carrying Value, Provision | $ 210,000 | |||||
Fox Hills Machining V. Cnc Repos [Member] | ||||||
Loss Contingency, Lawsuit Filing Date | April 14, 2009 | |||||
Loss Contingency, Damages Sought, Value | $ 40,000 | |||||
Loss Contingency Damages Awarded Value | 48,673 | |||||
Loss Contingency Settlement Agreement Periodic Payments | 10,000 | |||||
Loss Contingency Damages Paid Value | 40,000 | |||||
Loss Contingency Accrual, Carrying Value, Provision | 8,673 | |||||
C. William Kircher Jr. V M Line Holdings, Inc. [Member] | ||||||
Loss Contingency Settlement Agreement Periodic Payments | $ 5,000 | |||||
Loss Contingency, Settlement Agreement, Terms | The terms of the settlement call for 12 payments of $5,000 per month commencing August 25, 2011 and the issuance of 150,000 shares of common stock. | |||||
Legal Fees | $ 120,166 | |||||
Shares issued for deposit (in shares) | 150,000 | |||||
Loss Contingency Accrual, Carrying Value, Provision | $ 50,000 | |||||
Timothy D Consalviv M Line Holdings Incetal [Member] | ||||||
Loss Contingency, Damages Sought, Value | $ 40,000 | |||||
Loss Contingency, Settlement Agreement, Terms | A settlement of $50,000 was reached in this case, requiring payments commencing on March 11, 2011 for 10 months. | |||||
Loss Contingency Accrual, Carrying Value, Payments | $ 50,000 | |||||
Loss Contingency Accrual, Carrying Value, Provision | 40,000 | |||||
All Direct Travel Services Inc. Vs Jitu Banker [Member] | ||||||
Loss Contingency, Estimate of Possible Loss | $ 2,000 | |||||
Douglas Technologies v Elite Machine Tool Co | ||||||
Loss Contingency, Lawsuit Filing Date | June 30, 2013 | |||||
Loss Contingency Damages Awarded Value | $ 50,000 | |||||
Loss Contingency, Settlement Agreement, Date | November 5, 2013 | |||||
Loss Contingency Settlement Agreement Periodic Payments | $ 5,000 | |||||
Loss Contingency, Settlement Agreement, Terms | This case was settled on November 5, 2013 for $50,000 requiring a commencing payment of $10,000 on November 15, 2013. | |||||
Alu Forge v Jitu Banker | ||||||
Loss Contingency, Settlement Agreement, Date | October 31, 2013 | |||||
Loss Contingency Settlement Agreement Consideration 1 | $ 19,500 | |||||
Yates Fontenot Smith and Brum v MLine | ||||||
Loss Contingency, Lawsuit Filing Date | February 15, 2013 |
Income Taxes - Provision (Benef
Income Taxes - Provision (Benefit) For Income Taxes (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2014 | Jun. 30, 2013 | |
Income Tax Disclosure [Abstract] | ||
Current tax expense | ||
Federal | $ 360 | |
State | $ 1,894 | 2,770 |
Deferred | (16,710) | |
Income Tax Expense Total | $ 1,894 | $ (13,580) |
Income Taxes - Income Tax Rate
Income Taxes - Income Tax Rate Reconciliation (Details) | 12 Months Ended | |
Jun. 30, 2014 | Jun. 30, 2013 | |
Income Tax Disclosure [Abstract] | ||
Federal tax at statutory rate | 34.00% | 34.00% |
Permanent differences: | ||
State income tax, net of federal benefit | 9.00% | 9.00% |
Change in valuation allowance | (28.00%) | (20.00%) |
Other | (15.00%) | (23.00%) |
Effective Income Tax Rate | 0.00% | 0.00% |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilties (Details) - USD ($) | Jun. 30, 2014 | Jun. 30, 2013 |
Deferred tax asset - current | ||
Allowances for bad debt | $ 19,507 | $ 12,666 |
Reserve for inventories | 75,364 | 85,680 |
Accrued expenses | 11,470 | 12,884 |
Other | 15,390 | 15,390 |
Deferred Tax Assets, Gross, Current | 121,731 | 126,620 |
Deferred tax assets-non-current | ||
Net Operating loss carry forwards | 3,821,274 | 1,414,764 |
Depreciation | 9,768 | 9,767 |
Amortization of intangibles | 50,212 | 40,822 |
Deferred Tax Assets, Gross, Noncurrent | 3,441,254 | 1,465,353 |
Total deferred tax asset | 3,562,985 | 1,591,973 |
Valuation allowance | $ 3,562,985 | $ (1,591,973) |
Net deferred tax asset | ||
Miscellaneous Deferred Tax Liability | ||
Non-current |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) - USD ($) | 12 Months Ended | |
Jun. 30, 2014 | Jun. 30, 2013 | |
Income Tax Disclosure [Abstract] | ||
Operating Loss Carryforwards | $ 7,900,000 | $ 7,700,000 |
Valuation Allowance | $ 2,700,000 | |
Operating loss carry forward expiration dates | Carry forwards will begin expiring between 2012 and 2021 |
Shareholders Equity (Details Na
Shareholders Equity (Details Narrative) - USD ($) | 12 Months Ended | |
Jun. 30, 2014 | Jun. 30, 2013 | |
Common Stock, Shares Authorized | 1,000,000,000 | 1,000,000,000 |
Common Stock, Par Value | $ 0.001 | $ 0.001 |
Preferred Stock, Shares Authorized | 20,000,000 | 20,000,000 |
Preferred Stock, Par Value | $ 0.001 | $ 0.001 |
Stock Issued, Services, Shares | 12,805,130 | 14,840,000 |
Stock Issued, Services, Value | $ 67,451 | $ 467,942 |
Stock Issued, Compensation, Shares | 8,500,000 | |
Stock Issued, Compensation, Value | $ 168,700 | |
Salaries to officers | $ 190,000 | |
Shares issued for debt repayment, Shares | 136,062,209 | |
Shares valued for debt settlement | $ 446,489 | |
Loss on settlement of liability | $ 35,190 | |
Common Stock | ||
Shares issued for in lieu of payroll, Shares | 6,000,000 | 8,500,000 |
Shares issued to settle unpaid salaries, Shares | 13,000,000 | |
Preferred Class A [Member] | ||
Preferred Stock, Shares Authorized | 200,000 | |
Stock issued to lender in connection with the line of credit, Shares | 200,000 | |
Financial advisor [Member] | ||
Shares issued for consulting services | $ 40,290 | |
Shares issued for consulting services, Shares | 5,100,000 |
Fair Value of Financial Instr58
Fair Value of Financial Instruments (Details - Fair Value of Derivative Liability) - USD ($) | Jun. 30, 2014 | Jun. 30, 2013 |
Embedded conversion derivative liability | $ 634,769 | |
Fair Value of Derivative Liability | $ 634,769 | |
Level 1 [Member] | ||
Embedded conversion derivative liability | ||
Fair Value of Derivative Liability | ||
Level 2 [Member] | ||
Embedded conversion derivative liability | ||
Fair Value of Derivative Liability | ||
Level 3 [Member] | ||
Embedded conversion derivative liability | $ 634,769 | |
Fair Value of Derivative Liability | $ 634,769 |
Fair Value of Financial Instr59
Fair Value of Financial Instruments (Details - Fair Value of Derivative Liability Unobservable Inputs) | 12 Months Ended |
Jun. 30, 2014USD ($) | |
Fair Value Disclosures [Abstract] | |
Balance at June 30, 2013 | |
Fair value of warrant derivative liabilities at issuance, recorded as debt discount | $ 832,572 |
Settlement of derivative liabilities to additional paid in capital | (1,144,321) |
Unrealized derivative loss included in other expense | 946,518 |
Balance at June 30, 2014 | $ 634,769 |
Fair Value of Financial Instr60
Fair Value of Financial Instruments (Details - Fair Value Black Scholes Option Pricing Model) - Jun. 30, 2014 - $ / shares | Total |
Dividend yield | 0.00% |
Minimum [Member] | |
50% of the market value of stock on measurement date | $ 0.04 |
Risk-free interest rate | 0.07% |
Volatility factor | 255.00% |
Term | 3 months |
Maximum [Member] | |
50% of the market value of stock on measurement date | $ 0.025 |
Risk-free interest rate | 0.44% |
Volatility factor | 334.00% |
Term | 1 year 10 months 24 days |
At Issuance [Member] | |
Dividend yield | 0.00% |
At Issuance [Member] | Minimum [Member] | |
50% of the market value of stock on measurement date | $ 0.01 |
Risk-free interest rate | 0.07% |
Volatility factor | 256.00% |
Term | 3 months 4 days |
At Issuance [Member] | Maximum [Member] | |
50% of the market value of stock on measurement date | $ 0.03 |
Risk-free interest rate | 0.13% |
Volatility factor | 343.00% |
Term | 2 years |
Segments and Geographic Infor61
Segments and Geographic Information - Segment Reporting Information (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2014 | Jun. 30, 2013 | |
Revenue | $ 8,701,122 | $ 9,324,685 |
Interest expense | 1,884,005 | 497,365 |
Depreciation and amortization | 162,079 | 173,532 |
Loss before taxes | (5,028,892) | (4,406,848) |
Total assets | 2,243,349 | 3,697,089 |
Capital expenditures | 8,000 | 19,335 |
Machine Sales [Member] | ||
Revenue | 6,593,151 | 5,810,909 |
Interest expense | 158,718 | 44,913 |
Depreciation and amortization | 1,500 | 3,000 |
Loss before taxes | (636,758) | (55,673) |
Total assets | $ 374,911 | $ 1,077,202 |
Capital expenditures | ||
Precision Manufacturing [Member] | ||
Revenue | $ 2,106,971 | $ 3,513,776 |
Interest expense | 270,615 | 266,400 |
Depreciation and amortization | 160,579 | 166,745 |
Loss before taxes | (1,028,070) | (1,361,221) |
Total assets | 1,783,300 | 2,384,185 |
Capital expenditures | 8,000 | $ 19,335 |
Corporate [Member] | ||
Revenue | 1,000 | |
Interest expense | $ 1,454,672 | $ 186,052 |
Depreciation and amortization | 3,787 | |
Loss before taxes | $ (3,364,064) | (2,989,954) |
Total assets | $ 85,138 | $ 235,702 |
Capital expenditures |
Segments and Geographic Infor62
Segments and Geographic Information (Details Narrative) - Jun. 30, 2014 - USD ($) | Total |
Notes to Financial Statements [Abstract] | |
Common stock shares held by M Line Holdings | $ 2,100,000 |
Market value of per share | $ 1 |
Notional value | $ 1,000 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) | Oct. 14, 2015 | Jan. 15, 2015 | Jul. 31, 2014 | Jun. 30, 2014 | Jun. 30, 2013 | Mar. 03, 2015 |
Lease rent commenced | $ 545,177 | $ 460,565 | ||||
Shares issued for conversion of debt | $ 446,489 | |||||
Shares issued | 243,178,484 | 70,211,145 | ||||
Subsequent Event [Member] | ||||||
Lease description | The Companys new lease is for a period from July 1, 2015 until August 31, 2024 | |||||
Lease rent commenced | $ 23,353 | |||||
Lease agreement term | 10 years | |||||
Proceeds from convertible debt | $ 330,000 | |||||
Funded convertible notes | $ 257,000 | |||||
Shares issued for conversion of debt, Shares | 668,818,367 | |||||
Shares issued for conversion of debt | $ 306,977 | |||||
Convertible notes, Description | Convertible at the lower of $0.001 or 50% of the lowest trading price of the Companys common stock during the 20 consecutive trading days prior to the date of conversion. | |||||
Subsequent Event [Member] | TCA [Member] | ||||||
Agreement settlement amount | $ 100,000 | |||||
Subsequent Event [Member] | TCA [Member] | Pending Litigation Amount [Member] | ||||||
Agreement settlement amount | $ 80,000 | |||||
Agreement settlement amount term for pending amount | 13 months | |||||
Pending settlement amount in fifteenth month | $ 60,000 | |||||
Subsequent Event [Member] | Two officers [Member] | ||||||
Shares issued | 200,000,000 | |||||
Subsequent Event [Member] | Officers [Member] | ||||||
Shares issued | 10,000,000 | |||||
Preferred Stock, Voting Rights | Preferred stock (designated as Series A Preferred Stock) which are non-convertible, zero dividend and zero interest and carry a voting power equivalent to 50% of the Companys outstanding common and preferred stock. |