Document and Entity Information
Document and Entity Information | 3 Months Ended |
Sep. 30, 2020 | |
Document And Entity Information | |
Entity Registrant Name | GALAXY NEXT GENERATION, INC. |
Entity Central Index Key | 0001127993 |
Document Type | S-1/A |
Amendment Flag | false |
Entity Filer Category | Non-accelerated Filer |
Entity Small Business | true |
Entity Emerging Growth Company | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 |
Current Assets | |||
Cash | $ 411,721 | $ 412,391 | $ 169,430 |
Accounts receivable, net | 1,494,872 | 798,162 | 262,304 |
Inventories, net | 817,010 | 738,091 | 648,715 |
Prepaid and other current assets | 2,800 | 2,800 | 20,898 |
Total Current Assets | 2,726,403 | 1,951,444 | 1,101,347 |
Property and Equipment, net (Note 2 & 3) | 47,621 | 52,049 | 26,765 |
Intangibles, net (Notes 1 and 12 & Notes 4 and 14) | 1,355,803 | 1,436,315 | |
Goodwill (Notes 1 and 12 & Notes 4 and 14) | 834,220 | 834,220 | 834,220 |
Operating right of use assets (Notes 1 and 7 & Note 9) | 249,299 | 223,982 | |
Total Assets | 5,213,346 | 4,498,010 | 1,962,332 |
Current Liabilities | |||
Line of credit (Note 3 & Note 5) | 1,236,598 | 1,230,550 | |
Convertible notes payable, net of discount (Note 4 & Note 6) | 677,546 | 1,101,900 | 2,124,824 |
Derivative liability, convertible debt features and warrants (Note 7) | 1,276,312 | 246,612 | 1,025,944 |
Current portion of long term notes payable (Note 4 & Note 6) | 570,962 | 512,425 | 279,346 |
Accrued legal settlement payable (Note 10 & Note 12) | 500,000 | 1,282,000 | |
Accounts payable | 1,283,957 | 1,804,269 | 655,941 |
Accrued expenses | 213,311 | 371,912 | 597,351 |
Deferred revenue | 1,565,139 | 1,133,992 | 247,007 |
Short term vendor payable | 34,941 | ||
Short term notes payable - related party (Note 6 & Note 8) | 1,239,402 | 1,272,812 | 200,000 |
Total Current Liabilities | 7,326,629 | 8,962,520 | 6,395,904 |
Noncurrent Liabilities | |||
Line of credit (Note 5) | 936,598 | ||
Long term portion of accounts payable | 174,703 | ||
Long term portion of related party notes payable (Note 6 & Note 8) | 2,075,000 | 2,075,000 | |
Long term portion of accrued legal settlement (Note 10 & Note 12) | 558,240 | 718,000 | |
Notes payable, less current portion (Note 4 & Note 6) | 447,614 | 482,553 | 1,607 |
Total Liabilities | 11,344,081 | 12,238,073 | 6,572,214 |
Stockholders' Equity (Deficit) (Notes 1 and 8) | |||
Common stock | 191,211 | 59,539 | 1,072 |
Preferred stock - Series E, non-redeemable | 50 | 50 | |
Additional paid-in capital | 30,309,574 | 15,697,140 | 4,859,731 |
Accumulated deficit | (36,631,570) | (23,496,792) | (9,470,685) |
Total Stockholders' Equity (Deficit) | (6,130,735) | (7,740,063) | (4,609,882) |
Total Liabilities and Stockholders' Equity (Deficit) | $ 5,213,346 | $ 4,498,010 | $ 1,962,332 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Revenues | ||||
Total Revenues | $ 1,178,213 | $ 624,897 | $ 2,319,852 | $ 1,882,058 |
Cost of Sales | ||||
Total Cost of Sales | 833,177 | 493,679 | 1,136,126 | 1,766,331 |
Gross Profit | 345,036 | 131,218 | 1,183,726 | 115,727 |
General and Administrative Expenses | ||||
Stock compensation and stock issued for services | 2,763,000 | 1,327,811 | 2,087,425 | 2,416,934 |
Asset impairment expense | 2,000,287 | |||
Legal settlement expense | 2,000,000 | |||
General and administrative | 1,392,227 | 796,048 | 4,841,085 | 3,421,336 |
Total General and Administrative Expenses | 4,155,227 | 2,123,859 | 10,928,797 | 5,838,270 |
Loss from Operations | (3,810,191) | (1,992,641) | (9,745,071) | (5,722,543) |
Other Income (Expense) | ||||
Other income | 3,049 | 6,415 | 126,530 | |
Expenses related to convertible notes payable: | ||||
Change in fair value of derivative liability | (1,053,895) | 802,968 | 2,651,957 | (89,198) |
Interest accretion | (399,936) | (228,933) | (1,825,506) | (644,055) |
Interest expense related to Put Purchase Agreement (Note 13) | (4,006,900) | |||
Interest expense | (3,863,856) | (601,790) | (5,113,902) | (333,851) |
Total Other Income (Expense) | (9,324,587) | (24,706) | (4,281,036) | (940,574) |
Net Loss before Income Taxes | (13,134,778) | (2,017,347) | (14,026,107) | (6,663,117) |
Income taxes (Note 8) | ||||
Net Loss | $ (13,134,778) | $ (2,017,347) | $ (14,026,107) | $ (6,663,117) |
Net Basic and Fully Diluted Loss Per Share | $ (0.008) | $ (0.138) | $ (0.147) | $ (0.658) |
Weighted average common shares outstanding Basic and fully diluted | 95,191,792 | 10,128,475 | ||
Basic | 1,642,915,407 | 14,658,382 | ||
Fully diluted | 2,633,468,281 | 17,105,758 | 753,647,090 | 10,518,750 |
Technology interactive panels and related products [Member] | ||||
Revenues | ||||
Total Revenues | $ 2,304,028 | $ 1,265,786 | ||
Cost of Sales | ||||
Total Cost of Sales | 1,136,126 | 1,545,093 | ||
Entertainment theater ticket sales and concessions [Member] | ||||
Revenues | ||||
Total Revenues | 589,705 | |||
Cost of Sales | ||||
Total Cost of Sales | 221,238 | |||
Technology office supplies [Member] | ||||
Revenues | ||||
Total Revenues | $ 15,824 | $ 26,567 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity (Deficit) - USD ($) | Common Stock [Member] | Preferred Stock - Class E [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Total |
Beginning Balance at Jun. 30, 2018 | $ 965 | $ 3,108,873 | $ (2,807,568) | $ 302,270 | |
Beginning Balance, shares at Jun. 30, 2018 | 9,655,813 | ||||
Common stock issued as part of the private placement in September 2018 | 637,000 | 637,000 | |||
Common stock issued as part of the private placement in September 2018, shares | 182,255 | ||||
Common stock issued for warrants and convertible debt in January and February 2019 | $ 39 | 962,344 | 962,383 | ||
Common stock issued for warrants and convertible debt in January and February 2019, shares | 392,271 | ||||
Non-cash consideration for net assets of Entertainment in February 2019 | $ (4) | (92,696) | (92,700) | ||
Sale of Entertainment net assets in February 2019 | (1,511,844) | (1,511,844) | |||
Common stock issued for services in March and May 2019 | $ 17 | 348,075 | 348,075 | ||
Common stock issued for services in March and May 2019, shares | 162,790 | ||||
Common stock issued for cash less exercise of warrants in May 2019 | |||||
Common stock issued for cash less exercise of warrants in May 2019, shares | 381,944 | ||||
Settlement of conversion features and warrants in April and May 2019 | 301,575 | 301,575 | |||
Common Stock issued under Stock Plan in May and June 2019 | $ 51 | 1,015,749 | 1,015,800 | ||
Common Stock issued under Stock Plan in May and June 2019, shares | 510,000 | ||||
Common stock issued for services in June 2019 | $ 4 | 90,655 | 90,659 | ||
Common stock issued for services in June 2019, shares | 33,828 | ||||
Consolidated net loss | (6,663,117) | (6,663,117) | |||
Ending Balance at Jun. 30, 2019 | $ 1,072 | 4,859,731 | (9,470,685) | (4,609,882) | |
Ending Balance, shares at Jun. 30, 2019 | 11,318,901 | ||||
Common stock issued for services in July 2019 through June 2020 | $ 57 | 1,283,243 | 1,283,300 | ||
Common stock issued for services in July 2019 through June 2020, shares | 555,000 | ||||
Common stock issued in exchange for debt reduction in August 2019 through June 2020 | $ 75 | 1,027,690 | 1,027,765 | ||
Common stock issued in exchange for debt reduction in August 2019 through June 2020, shares | 745,261 | ||||
Settlement of conversion features in August and September 2019 (Note 8) | 149,374 | 149,374 | |||
Issuance of common stock to Warrant holders in September 2019 through April 2020 | |||||
Issuance of common stock to Warrant holders in September 2019 through April 2020, shares | 644,709 | ||||
Common stock issued as compensation in September 2019 and January 2020 | $ 4 | 44,507 | 44,511 | ||
Common stock issued as compensation in September 2019 and January 2020, shares | 44,511 | ||||
Common stock issued in acquisition of Ehlert Solutions, Inc. and Interlock Concepts, Inc. (Note 12) | $ 135 | 1,720,216 | 1,720,351 | ||
Common stock issued in acquisition of Ehlert Solutions, Inc. and Interlock Concepts, Inc. (Note 12), shares | 1,350,000 | ||||
Consolidated net loss | (2,017,347) | (2,017,347) | |||
Ending Balance at Sep. 30, 2019 | $ 1,343 | 9,084,761 | (11,488,032) | (2,401,928) | |
Ending Balance, shares at Sep. 30, 2019 | 14,658,382 | ||||
Beginning Balance at Jun. 30, 2019 | $ 1,072 | 4,859,731 | (9,470,685) | (4,609,882) | |
Beginning Balance, shares at Jun. 30, 2019 | 11,318,901 | ||||
Common stock issued for services in July 2019 through June 2020 | $ 764 | 2,020,150 | 2,020,914 | ||
Common stock issued for services in July 2019 through June 2020, shares | 7,619,912 | ||||
Common stock issued in exchange for debt reduction in August 2019 through June 2020 | $ 57,501 | 6,158,275 | 6,215,776 | ||
Common stock issued in exchange for debt reduction in August 2019 through June 2020, shares | 575,028,264 | ||||
Settlement of conversion features in August and September 2019 (Note 8) | 149,374 | 149,374 | |||
Issuance of common stock to Warrant holders in September 2019 through April 2020 | 637,000 | ||||
Issuance of common stock to Warrant holders in September 2019 through April 2020, shares | 32,052,654 | ||||
Common stock issued as compensation in September 2019 and January 2020 | $ 14 | 59,497 | 59,511 | ||
Common stock issued as compensation in September 2019 and January 2020, shares | 144,511 | ||||
Common stock issued in acquisition of Ehlert Solutions, Inc. and Interlock Concepts, Inc. (Note 12) | $ 135 | 1,720,216 | 1,720,351 | ||
Common stock issued in acquisition of Ehlert Solutions, Inc. and Interlock Concepts, Inc. (Note 12), shares | 1,350,000 | ||||
Settlement of conversion features in October 2019 | 3,000 | 3,000 | |||
Common stock issued for convertible notes in November 2019 | $ 50 | 219,950 | 220,000 | ||
Common stock issued for convertible notes in November 2019, shares | 500,000 | ||||
Commitment shares issued in December 2019 | $ 3 | 6,997 | 7,000 | ||
Commitment shares issued in December 2019, shares | 25,000 | ||||
Issuance of Preferred Stock - Class E (Note 8) | $ 50 | 499,950 | 500,000 | ||
Issuance of Preferred Stock - Class E (Note 8), shares | 500,000 | ||||
Consolidated net loss | (14,026,107) | (14,026,107) | |||
Ending Balance at Jun. 30, 2020 | $ 59,539 | $ 50 | 15,697,140 | (23,496,792) | (7,740,063) |
Ending Balance, shares at Jun. 30, 2020 | 628,039,242 | 500,000 | |||
Common stock issued for services in July 2019 through June 2020 | $ 10,375 | 2,752,625 | 2,763,000 | ||
Common stock issued for services in July 2019 through June 2020, shares | 103,750,000 | ||||
Common stock issued in exchange for debt reduction in August 2019 through June 2020 | $ 96,847 | 7,877,359 | 7,974,206 | ||
Common stock issued in exchange for debt reduction in August 2019 through June 2020, shares | 968,475,442 | ||||
Issuance of common stock to Warrant holders in September 2019 through April 2020 | |||||
Issuance of common stock to Warrant holders in September 2019 through April 2020, shares | 249,792,217 | ||||
Commitment shares issued in December 2019 | $ 250 | 54,750 | 55,000 | ||
Commitment shares issued in December 2019, shares | 2,500,000 | ||||
Common stock issued under Put Purchase Agreement | $ 24,200 | 3,927,000 | 3,951,900 | ||
Common stock issued under Put Purchase Agreement, shares | 242,000,000 | ||||
Consolidated net loss | (13,134,778) | (13,134,778) | |||
Dividends | |||||
Ending Balance at Sep. 30, 2020 | $ 191,211 | $ 50 | $ 30,309,574 | $ (36,631,570) | $ (6,130,735) |
Ending Balance, shares at Sep. 30, 2020 | 2,194,556,901 | 500,000 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Cash Flows from Operating Activities | ||||
Net loss | $ (13,134,778) | $ (2,017,347) | $ (14,026,107) | $ (6,663,117) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||||
Depreciation and amortization | 84,940 | 7,832 | 644,545 | 221,260 |
Loss on disposal of property and equipment | 20,902 | |||
Amortization of convertible debt discounts | 74,775 | 60,268 | 340,526 | 89,279 |
Accretion and settlement of financing instruments and change in fair value of derivative liability | 1,381,363 | (1,346,797) | (779,332) | 733,258 |
Impairment of goodwill and intangible assets | 2,000,287 | |||
Gain on sale of Entertainment (Note 12) | (60,688) | |||
Stock compensation and stock issued for services | 2,870,472 | 2,934,201 | 2,417,041 | |
Stock issued under Put Purchase Agreement | 7,865,077 | |||
Changes in assets and liabilities: | ||||
Accounts receivable | (696,710) | 82,359 | 124,428 | 74,922 |
Inventories | (78,919) | 304,970 | (3,579) | (67,561) |
Prepaid expenses and other assets | (200,984) | (1,566,268) | ||
Right of use assets | 143,521 | |||
Accounts payable | (1,462,072) | (22,995) | (109,833) | 175,021 |
Accrued legal settlement and and other accrued expenses | (158,601) | (346,095) | 1,162,698 | 712,318 |
Deferred revenue | 431,147 | (91,453) | 375,040 | 27,187 |
Net cash used in operating activities | (2,823,306) | (3,369,258) | (7,373,687) | (3,907,348) |
Cash Flows from Investing Activities | ||||
Acquisition of business, net of cash | 2,967,918 | 2,967,918 | ||
Purchases of property and equipment | (17,636) | (17,637) | ||
Net cash provided by investing activities | 2,950,282 | 2,950,281 | ||
Cash Flows from Financing Activities | ||||
Principal payments on financing lease obligations | (1,649) | (4,808) | (11,486) | |
Principal payments on notes payable | (774) | (47,060) | ||
Payments on advances from stockholder, net | (33,110) | (111,173) | ||
Payments on convertible notes payable | (873,003) | |||
Proceeds from convertible notes payable | 840,000 | 667,000 | 4,978,934 | 2,495,235 |
Proceeds from loans | 504,571 | |||
Proceeds from sale of common stock under Purchase Agreement | 2,316,520 | 637,000 | ||
Payments on line of credit, net | (300,000) | 682,947 | ||
Proceeds from notes payable - related parties | 107,733 | 200,000 | ||
Net cash provided by financing activities | 2,822,636 | 665,351 | 4,666,367 | 3,892,523 |
Net (Decrease) Increase in Cash and Cash Equivalents | (670) | 246,375 | 242,961 | (14,825) |
Cash, Beginning of Period | 412,391 | 169,430 | 169,430 | 184,255 |
Cash, End of Period | 411,721 | 415,805 | 412,391 | 169,430 |
Supplemental and Non Cash Disclosures | ||||
Noncash additions related to convertible debt | 34,250 | 119,986 | 515,166 | 134,461 |
Cash paid for interest | 19,986 | 129,536 | 195,988 | 402,903 |
Interest on shares issued under Put Purchase Agreement | 4,006,900 | |||
Non-cash consideration for sale of Entertainment | 92,700 | |||
Related party note payable issued for acquisition of business | 900,000 | 1,484,473 | ||
Settlement of conversion features | 149,374 | 152,374 | ||
Acquisition of goodwill and intangibles | 3,760,287 | 3,760,287 | ||
Convertible note and warrants extinguished | 6,521,161 | |||
Stock compensation and stock issued for services | 2,763,000 | 1,327,811 | 2,087,425 | |
Property leased with financing lease | 25,317 | 37,980 | ||
Fair value of convertible note issued to stockholder | 1,225,000 | |||
Fair value of preferred stock - Series E issued to stockholder | 500,000 | |||
Non-cash principal payments from proceeds of convertible debt | 1,907,000 | 602,024 | ||
Accretion of discount on convertible notes payable | 1,029,700 | 1,825,506 | 644,055 | |
Sale of Entertainment | 1,511,844 | |||
Common stock issued in exchange for convertible debt reduction | $ 1,799,510 | $ 1,027,765 | $ 1,869,053 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Accounting Policies [Abstract] | ||
Summary of Significant Accounting Policies | Note 1 - Summary of Significant Accounting Policies Impact of Coronavirus Aid, Relief, and Economic Security Act The Coronavirus Aid, Relief and Economic Security Act (the "CARES Act") was enacted in March 2020 in response to the COVID-19 pandemic. The CARES Act and related rules and guidelines include several significant provisions, including delaying certain payroll tax payments, mandatory transition tax payments, and estimated income tax payments that we are deferring to future periods. As a result, the Company delayed payment of certain payroll tax payments in the amount of $19,517 as of September 30, 2020 and June 30, 2020, respectively. In April 2020, the Company applied for an unsecured loan (The "PPP Loan") under the Paycheck Protection Program (PPP). The PPP was established under The CARES Act and is administered by the U.S. Small Business Administration (SBA). The PPP loan was approved and funded, and the Company entered into an unsecured loan of approximately $311,000. The PPP loan matures in April 2022 and accrues interest at an annual rate of 0.98%. The promissory note evidencing the PPP Loan contains customary events of default relating to, among other things, payment defaults and provisions of the promissory note. In accordance with the requirements of the CARES Act, the Company used the proceeds from the PPP Loan primarily for payroll costs. See Note 6. In May 2020, the Company received a loan from the SBA under Section 7(b) of the Small Business Act. The $150,000 secured loan matures in May 2050 and accrues interest at an annual rate of 3.75%. The promissory note is collateralized by a security interest in substantially all assets of the Company. The loan proceeds are to fund working capital needs due to economic injury caused by the COVID-19 pandemic. See Note 6. Corporate History, Nature of Business, Mergers and Acquisitions Galaxy Next Generation LTD CO. ("Galaxy CO") merged with R&G Sales, Inc. ("R&G") ("common controlled merger") with R&G becoming the surviving company. R&G subsequently changed its name to Galaxy Next Generation, Inc. On September 4, 2019, Galaxy acquired 100% of the stock of Interlock Concepts, Inc. ("Concepts") and Ehlert Solutions Group, Inc. ("Solutions"). The purchase price for the acquisition was 1,350,000 shares of common stock and a two year note payable to the seller for $3,000,000. The note payable to the seller is subject to adjustment based on the achievement of certain future gross revenues and successful completion of certain pre-acquisition withholding tax issues of Concepts and Solutions. Solutions and Concepts are Utah-based audio design and manufacturing companies creating innovative products that provide fundamental tools for building notification systems primarily to K-12 education market customers located primarily in the north and northwest United States. These products and services allow institutions access to intercom, scheduling, and notification systems with improved ease of use. The products provide an open architecture solution to customers which allows the products to be used in both existing and new environments. Intercom, public announcement (PA), bell and control solutions are easily added and integrated within the open architecture design and software model. These products combine elements over a common internet protocol (IP) network, which minimizes infrastructure requirements and reduces costs by combining systems. Galaxy is a manufacturer and U.S. distributor of interactive learning technology hardware and software that allows the presenter and participant to engage in a fully collaborative instructional environment. Galaxy's products include Galaxy's own private-label interactive touch screen panel as well as numerous other national and international branded peripheral and communication devices. New technologies like Galaxy's own touchscreen panels are sold along with renowned brands such as Google Chromebooks, Microsoft Surface Tablets, Lenovo & Acer computers, Verizon WiFi and more. Galaxy's distribution channel consists of approximately 30 resellers across the U.S. who primarily sell its products within the commercial and educational market. Galaxy does not control where the resellers focus their resell efforts; however, the K-12 education market is the largest customer base for Galaxy products comprising nearly 90% of Galaxy's sales. In addition, Galaxy also possesses its own reseller channel where it sells directly to the K-12 market, primarily throughout the Southeast region of the United States. Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America. Any reference in these footnotes to applicable guidance is meant to refer to the authoritative U.S. generally accepted accounting principles ("GAAP") as found in the Accounting Standards Codification ("ASC") and Accounting Standards Update ("ASU") of the Financial Accounting Standards Board ("FASB"). The financial statements include the consolidated assets and liabilities of the combined company (collectively Galaxy Next Generation, Inc., Interlock Concepts, Inc., and Ehlert Solutions Group, Inc. referred to collectively as the "Company"). See Note 14. All intercompany transactions and accounts have been eliminated in the consolidation. The Company is an over-the-counter public company traded under the stock symbol listing GAXY (formerly FLCR). Use of Estimates The preparation of consolidated financial statements in accordance with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates used in preparing the consolidated financial statements include those assumed in computing product warranty liabilities, product development costs, valuation of goodwill and intangible assets, valuation of convertible notes payable and warrants, and the valuation of deferred tax assets. It is reasonably possible that the significant estimates used will change within the next year. Capital Structure In accordance with ASC 505, Equity, the Company's capital structure is as follows: September 30, 2020 Authorized Issued Outstanding Common stock 4,000,000,000 2,194,557,083 2,194,518,458 $.0001 par value, one vote per share Preferred stock 200,000,000 - - $.0001 par value, one vote per share Preferred stock - Class A 750,000 - - $.0001 par value; no voting rights Preferred stock - Class B 1,000,000 - - Voting rights of 10 votes for 1 Preferred B share; 2% preferred dividend payable annually Preferred stock - Class C 9,000,000 - - $.0001 par value; 500 votes per share, convertible to common stock Preferred stock - Class D 1,000,000 - - $.0001 par value; no voting rights, convertible to common stock, mandatory conversion to common stock 18 months after issue Preferred stock - Class E 500,000 500,000 500,000 $.0001 par value; no voting rights, convertible to common stock June 30, 2020 Authorized Issued Outstanding Common stock 4,000,000,000 628,039,242 628,000,617 $.0001 par value, one vote per share Preferred stock 200,000,000 - - $.0001 par value, one vote per share Preferred stock - Class A 750,000 - - $.0001 par value; no voting rights Preferred stock - Class B 1,000,000 - - Voting rights of 10 votes for 1 Preferred B share; 2% preferred dividend payable annually Preferred stock - Class C 9,000,000 - - $.0001 par value; 500 votes per share, convertible to common stock Preferred stock - Class D 1,000,000 - - $.0001 par value; no voting rights, convertible to common stock, mandatory conversion to common stock 18 months after issue Preferred stock - Class E 500,000 500,000 500,000 $.0001 par value; no voting rights, convertible to common stock There is no publicly traded market for the preferred shares. There are 1,101,609,009 common shares reserved at September 30, 2020 under terms of the convertible debt agreements, Stock Plan and Put Purchase Agreement (see Notes 6, 14 and 15). There are 125,953,028 issued common shares that are restricted as of September 30, 2020. The shares may become free-trading upon satisfaction of certain terms and regulatory conditions. Business Combinations The Company accounts for business combinations under the acquisition method of accounting. Under this method, acquired assets, including separately identifiable intangible assets, and any assumed liabilities are recorded at their acquisition date estimated fair value. The excess of purchase price over the fair value amounts assigned to the assets acquired and liabilities assumed represents the goodwill amount resulting from the acquisition. Determining the fair value of assets acquired and liabilities assumed involves the use of significant estimates and assumptions. Revenue Recognition In accordance with ASC 606, revenue is recognized when a customer obtains control of promised services. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for these services. To achieve this core principle, the Company applies the following five steps: ● Identify the contract with a customer ● Identify the performance obligations in the contract ● Determine the transaction price ● Allocate the transaction price to performance obligations in the contract ● Recognize revenue when or as the Company satisfies a performance obligation All of the Company's performance obligations and associated revenue are generally transferred to customers at a point in time. Shipping and handling costs billed to customers are included in revenue in the accompanying statements of operations. Costs incurred by the Company associated with shipping and handling are included in cost of sales in the accompanying statements of operations. Sales are recorded net of sales returns and discounts, and sales are presented net of sales-related taxes. Contracts with Multiple Performance Obligations Most contracts with customers contain multiple performance obligations. For these contracts, the Company accounts for individual performance obligations separately if they are distinct. The transaction price is allocated to the separate performance obligations on a relative standalone selling price basis. The Company's products can be sold on a stand-alone basis to customers which provides objective evidence of the fair value of the product portion of the multi-element contract, and thus represents the Company's best estimate of selling price. The Company considers several factors in determining that control transfers to the customer including that legal title transfers to the customer, the Company has a present right to payment, and the customer has assumed the risks and rewards of ownership. Product Product revenue consists of fees for associated equipment sold, such as interactive panels, intercom, public announcement, bell and control solutions. Product sales resulting from fixed-price contracts involve a signed contract for a fixed price or a binding purchase order to provide the Company's interactive panels and accessories. Revenue is recognized at a point in time once the product is installed at the customer's premises. Hardware items are generally invoiced in full on execution of the arrangement. Service Service revenue consists of installation and training services, support maintenance, technical assistance, bug fixes, and product repair. The Company satisfies its service performance obligations by providing "stand-ready" assistance as required over the contract period. The fair value of these services is separately calculated using expected costs of the services. Many times, the value of the services is calculated using price quotations from subcontractors to the Company who perform such services on a stand-alone basis. Additionally, service revenue not part of the contract is based upon standard hourly/daily rates, and revenue is recognized as the services are performed. Software The Company sells equipment with embedded software to its customers. The embedded software is not sold separately and is not a significant focus of the Company's marketing efforts. The Company does not provide post-contract customer support specific to the software or incur significant costs that are within the scope of FASB guidance on accounting for software to be leased or sold. Additionally, the functionality that the software provides is marketed as part of the overall product. The software embedded in the equipment is incidental to the equipment as a whole. Reserves and Warranties The Company does not record a reserve for product returns as contract arrangements generally exclude a right of return for delivered items. Because of the nature and quality of the Company's products, the Company provides for the estimated costs of warranties at the time revenue is recognized for a period of five years after purchase as a secondary warranty. The manufacturer also provides a warranty against certain manufacturing and other defects. As of September 30, 2020 and June 30, 2020, the Company accrued $102,350, respectively, for estimated product warranty claims, which is included in accrued expenses in the accompanying condensed consolidated balance sheets. The accrued warranty costs are based primarily on historical warranty claims as well as current repair costs. There was $1,391 and $82,494 of warranty expense for the three months ended September 30, 2020 and 2019, respectively. The Company negotiated a warranty settlement with one of its manufacturers. At September 30, 2020 and June 30, 2020, the Company accrued $87,720 and $124,437 payable to this manufacturer. Costs to Obtain and Fulfill a Contract The Company incurs incremental costs to obtain a contract in the form of sales commissions. These costs, whether related to performance obligations that extend beyond twelve months or not, are immaterial and will continue to be recognized in the period incurred within general and administrative expenses. Contract Assets and Contract Liabilities Contract assets are rights to consideration in exchange for goods or services that has been transferred to a customer when that right is conditional on something other than the passage of time. The majority of our contract assets represent unbilled accounts receivable as the right to consideration is subject to the contractually agreed upon installation and billing schedule. Contract liabilities (deferred revenue) represent consideration received or consideration which is unconditionally due from customers prior to transferring goods or services to the customer under the terms of the contract, all of which is expected to be recognized within one year. Cash and Cash Equivalents The Company considers cash and cash equivalents to be cash in all bank accounts, including temporary investments that have an original maturity of three months or less. From time to time, the Company has on deposit, in institutions whose accounts are insured by the Federal Deposit Insurance Corporation, funds in excess of the insured maximum. The at-risk amount is subject to significant daily fluctuation. The Company has never experienced any losses related to these balances, and as such, the Company does not believe it is exposed to any significant risk. Accounts Receivable Accounts receivable is recognized when the Company's right to consideration is unconditional and is presented net of an allowance for doubtful accounts. Interest is not charged on past due accounts. Management reviews each receivable balance and estimates that portion, if any, of the balance that will not be collected. The carrying amount of accounts receivable is then reduced by an allowance based on management's estimate. Management deemed no allowance for doubtful accounts was necessary at September 30, 2020 and June 30, 2020. At September 30, 2020 and June 30, 2020, $1,145,187 and $670,031 of total accounts receivable were considered unbilled and recorded as deferred revenue. Accounts receivable unbilled is related to 1) a supply contract with a customer and 2) customers that are school districts. The unbilled accounts receivable and deferred revenue related to the supply contract are disclosed in Note 2. The remaining unbilled accounts receivable and deferred revenues are related to unconditional purchase orders from school districts; therefore, excluded from contract asset and liabilities. To enhance cash and liquidity, the Company factors trade accounts receivable with a financial services company. Factoring fees are 2.5% of the face value of the account receivable sold to the factoring agent per month until collected. For collections over 90 days from the invoice date, the fee increases to 3.5%. The proceeds received are included in cash provided by operating activities in the condensed consolidated statements of cash flows. The difference between the carrying amount of the trade receivables sold and the cash received is recorded as a general and administrative expense in the condensed consolidated statements of operations. For the three months ended September 30, 2020, expenses on sale of trade receivables was inconsequential. For the three months ended September 30, 2019, the Company did not factor accounts receivable. Inventories Inventory is stated at the lower of cost or net realizable value. Cost is determined on a first-in, first-out (FIFO) method of accounting. Galaxy inventory is comprised of interactive panels, audio and related accessories, and parts for audio products. Management estimates $67,635 of inventory reserves at September 30, 2020 and June 30, 2020. Property and Equipment Property and equipment are stated at cost less accumulated depreciation. Expenditures for repairs and maintenance are charged to expense as incurred and additions and improvements that significantly extend the lives of assets are capitalized. Upon sale or other retirement of depreciable property, the cost and accumulated depreciation are removed from the related accounts and any gain or loss is reflected in operations. Property and equipment and the estimated useful lives used in computing depreciation, are as follows: Furniture and fixtures 5 years Equipment 5 to 10 years Vehicles 5 years Depreciation is provided using the straight-line method over the estimated useful lives of the depreciable assets. Depreciation expense was $4,428 and $7,832 for the three months ended September 30, 2020 and 2019, respectively. Long-lived Assets Long-lived assets to be held and used are tested for recoverability whenever events or changes in circumstances indicate that the related carrying amount may not be recoverable. When required, impairment losses on assets to be held and used are recognized based on the excess of the asset's carrying amount over the fair value of the asset. Product Development Costs Costs incurred in designing and developing classroom technology products are expensed as research and development until commercial viability has been established. Commercial viability is established upon completion of a detail product design, or a working model. Upon the achievement of commercial viability, development costs are capitalized and subsequently reported at the lower of unamortized cost or net realizable value. Management's judgment is required in determining whether a product provides new or additional functionality, the point at which a product enters the stages at which costs may be capitalized, assessing the ongoing value and impairment of the capitalized costs and determining the estimated useful life over which the costs are amortized. Annual amortization expense is calculated based on the straight-line method over the product's estimated economic life. Amortization of product development costs incurred begins when the related products are available for sale to customers. Amortization of product development costs of $12,512 and $0 for the three months ended September 30, 2020 and 2019, and is included in cost of sales in the Company's condensed consolidated statements of operations. Goodwill and Intangible Assets Goodwill is not amortized, but is reviewed for impairment at least annually, or more frequently when events or changes in circumstances indicate that the carrying value may not be recoverable. Judgments regarding indicators of potential impairment are based on market conditions and operational performance of the business. At each fiscal year-end, the Company performs an analysis of goodwill or whenever events or circumstances arise that indicate an impairment may exist, such as the loss of a key executive, adverse industry and economic conditions, or increased or unexpected competition. The Company may assess its goodwill for impairment initially using a qualitative approach to determine whether conditions exist to indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying value. If management concludes, based on its assessment of relevant events, facts and circumstances that it is more likely than not that a reporting unit's carrying value is greater than its fair value, then a goodwill impairment charge is recognized for the amount in excess, not to exceed the total amount of goodwill allocated to that reporting unit. If the fair value of a reporting unit exceeds its carrying amount, goodwill is not considered to be impaired and no further testing is required. If determined to be impaired, an impairment charge is recorded as a general and administrative expense within the Company's condensed consolidated statements of operations. Management of the Company determined that a triggering event to assess goodwill impairment occurred during the year ended June 30, 2020 due to the separation of a key executive associated with their acquisition of Concepts and Solutions. While there was no single determinative event, the consideration in totality of several factors that developed led management to conclude that it was more likely than not that the fair values of certain intangible assets and goodwill acquired as part of that acquisition were below their carrying amounts. These factors included: a) former key executive separating from the Company; b) respective former key executive violating his noncompete changing the use and value of it; c) sustained decrease in the Company's share price which reduced market capitalization; and d) uncertainty in the United States and global economies due to Covid-19. As a result, the Company recorded a non-cash impairment loss of approximately $2,000,000, including $800,287 related to goodwill and $1,200,000 related to finite-lived intangibleassets. No such impairment charge was recorded during the three months ended September 30, 2020. Research and Development Research and development costs are expensed as incurred and totaled approximately $15,000 and $0 for the three months ended September 30, 2020 and 2019. Leases The Company's leases relate primarily to corporate offices and warehouses. Effective July 1, 2019, the Company adopted the FASB guidance on leases ("Topic 842"), which requires leases with durations greater than twelve months to be recognized on the balance sheet. The Company adopted Topic 842 using the modified retrospective transition approach. Income Taxes The Company accounts for income taxes under the asset and liability method, whereby deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Current income taxes are recognized for the estimated income taxes payable or receivable on taxable income or loss from the current year and any adjustment to income taxes payable related to previous years. Current income taxes are determined using tax rates and tax laws that have been enacted or subsequently enacted by the year-end date. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse. Under the asset and liability method, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is recognized if it is more likely than not that some portion or all of the deferred tax asset will not be utilized. Stock-based Compensation The Company records stock-based compensation in accordance with the provisions set forth in ASC 718, Stock Compensation ("ASC 718"). ASC 718 requires companies to recognize the cost of employee services received in exchange for awards of equity instruments based upon the grant date fair value of those awards. The Company, from time to time, may issue common stock to acquire services or goods from non-employees. Common stock issued to persons other than employees or directors are recorded on the basis of their fair value. Earnings (Loss) per Share Basic and diluted earnings (loss) per common share is calculated using the weighted average number of common shares outstanding during the period. The Company's convertible notes and warrants are excluded from the computation of diluted earnings per share as they are anti-dilutive due to the Company's losses during those periods. Fair Value of Financial Instruments The Company categorized its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset. Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs. As of September 30, 2020 ,and June 30, 2020, the Company held certain financial assets and liabilities that are required to be measured at fair value on a recurring basis. All such assets and liabilities are considered to be Level 3 in the fair value hierarchy defined above. The Company analyzes all financial instruments with features of both liabilities and equity under ASC 480, "Distinguishing Liabilities from Equity," and ASC 815. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820) - Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement ("ASU 2018-13"). The amendments in ASU 2018-13 modify certain disclosure requirements of fair value measurements. The Company adopted ASU 2018-13 on July 1, 2020 with no impact to the condensed consolidated financial statements as a result. Derivative Liabilities The Company generally does not use derivative financial instruments to hedge exposures to cash flow or market risks. However, certain other financial instruments, such as warrants and embedded conversion features on the convertible debt, are classified as derivative liabilities due to protection provisions within the agreements. Such financial instruments are initially recorded at fair value using the Monte Carlo model and subsequently adjusted to fair value at the close of each reporting period. The Company accounts for derivative instruments and debt instruments in accordance with the interpretive guidance of ASC 815, ASU 2017-11, and associated pronouncements related to the classification and measurement of warrants and instruments with conversion features and anti-dilution clauses in agreements. Recent Accounting Pronouncements In January 2020, the FASB issued ASU No. 2020-01, "Investments - Equity Securities (Topic 321), Investments - Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) - Clarifying the Interactions between Topic 321, Topic 323, and Topic 815." The ASU is based on a consensus of the Emerging Issues Task Force and is expected to increase comparability in accounting for these transactions. ASU 2020-01 made targeted improvements to accounting for financial instruments, including providing an entity the ability to measure certain equity securities without a readily determinable fair value at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. Among other topics, the amendments clarify that an entity should consider observable transactions that require it to either apply or discontinue the equity method of accounting. For public business entities, the amendments in the ASU are effective for fiscal years beginning after December 15, 2021, and interim periods within those fiscal years. The Company is currently evaluating the impacts of adoption of the new guidance to its consolidated financial statements. In December 2019, the FASB issued ASU No. 2019-12 "Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes ("ASU 2019-12") by removing certain exceptions to the general principles. The amendments will be effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption of the amendments is permitted. Depending on the amendment, adoption may be applied on a retrospective, modified retrospective or prospective basis. The Company is currently evaluating the impacts of adoption of the new guidance to its consolidated financial statements. In August 2020, the FASB issued ASU 2020-06, Accounting for Convertible Instruments and Contracts in an Entity's Own Equity, which simplifies the accounting for certain convertible instruments, amends guidance on derivative scope exceptions for contracts in an entity's own equity and modifies the guidance on diluted EPS calculations as a result of these changes. The guidance in this ASU can be adopted using either a full or modified retrospective approach and becomes effective for annual reporting periods beginning after December 15, 2021, with early adoption permitted. The Company is currently evaluating the impact of this standard on its consolidated financial statements and disclosures. The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the consolidated financialstatements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations. Reclassifications Certain amounts in the current condensed consolidated financial statements have been reclassified to conform to the current presentation. | Note 1 - Summary of Significant Accounting Policies Impact of Coronavirus Aid, Relief, and Economic Security Act The Coronavirus Aid, Relief and Economic Security Act (the CARES Act) was enacted in March 2020, in response to the COVID-19 pandemic. The CARES Act and related rules and guidelines include several significant provisions, including delaying certain payroll tax payments, mandatory transition tax payments, and estimated income tax payments that we are deferring to future periods. As a result, the Company delayed payment of certain payroll tax payments in the amount of $19,517 as of June 30, 2020. In April 2020, the Company applied for an unsecured loan under the Paycheck Protection Program, or the PPP Loan. The Paycheck Protection Program, or PPP, was established under CARES Act and is administered by the U.S. Small Business Administration (SBA). The PPP loan was approved and funded, and the Company entered into an unsecured loan of approximately $311,000. The loan matures in April 2022 and accrues interest at an annual rate of 0.98%. The promissory note evidencing the PPP Loan contains customary events of default relating to, among other things, payment defaults and provisions of the promissory note. In accordance with the requirements of the CARES Act, the Company used the proceeds from the PPP Loan primarily for payroll costs. See Note 4. In May 2020, the Company received a loan from the U.S. Small Business Administration under Section 7(b) of the Small Business Act. The $150,000 secured loan matures in May 2050 and accrues interest at an annual rate of 3.75%. The promissory note is collateralized by a security interest in substantially all assets of the Company. The loan proceeds are to fund working capital needs due to economic injury caused by the COVID-19 pandemic. See Note 4. Corporate History, Nature of Business, Mergers and Acquisitions Galaxy Next Generation LTD CO. (Galaxy CO) was organized in the state of Georgia in February 2017 while R & G Sales, Inc. (R&G) was organized in the state of Georgia in August 2004. Galaxy CO merged with R&G (common controlled merger) on March 16, 2018, with R&G becoming the surviving company. R&G subsequently changed its name to Galaxy Next Generation, Inc. (Galaxy). FullCircle Registry, Inc., (FLCR) is a holding company created for the purpose of acquiring small profitable businesses to provide exit plans for those companys owners. FLCRs subsidiary, FullCircle Entertainment, Inc. (Entertainment or FLCE), owns and operates Georgetown 14 Cinemas, a fourteen-theater movie complex located in Indianapolis, Indiana. On June 22, 2018, Galaxy consummated a reverse triangular merger whereby Galaxy merged with and into Full Circle Registry, Inc.s (FLCR) as a newly formed subsidiary which was formed specifically for the transaction (Galaxy MS). The merger resulted in Galaxy MS becoming a wholly-owned subsidiary of FLCR. For accounting purposes, the acquisition of Galaxy by FLCR is considered a reverse acquisition, an acquisition transaction where the acquired company, Galaxy, is considered the acquirer for accounting purposes, notwithstanding the form of the transaction. The primary reason the transaction is being treated as a purchase by Galaxy rather than a purchase by FLCR is that FLCR is a public reporting company, and Galaxys stockholders gained majority control of the outstanding voting power of FLCRs equity securities. Consequently, the assets and liabilities and the operations that are reflected in the historical financial statements of the Company prior to the merger are those of Galaxy. The financial statements after the completion of the merger include the combined assets and liabilities of the combined company (collectively Galaxy Next Generation, Inc., Full Circle Registry, Inc. and FullCircle Entertainment, Inc., or the Company). In recognition of Galaxys merger with FLCR, several things occurred: (1) FLCR amended its articles of incorporation to change its name from FullCircle Registry, Inc. to Galaxy Next Generation, Inc.; (2) Galaxy and FLCR changed its fiscal year end to June 30, effective June 2018; (3) FLCR authorized shares of preferred stock were increased to 200,000,000 and authorized shares of common stock were increased to 4,000,000,000, (prior to the Reverse Stock Split) both with a par value of $0.0001; and (4) the Board of Directors and Executive Officers approved Gary LeCroy, President and Director; Magen McGahee, Secretary and Director; and Carl Austin, Director; and (5) the primary business operated by the combined company became the business that was operated by Galaxy. On September 4, 2019, Galaxy acquired 100% of the stock of Interlock Concepts, Inc. (Concepts) and Ehlert Solutions Group, Inc. (Solutions). The purchase price for the acquisition was 1,350,000 shares of common stock and a two year note payable to the seller for $3,000,000. The note payable to the seller is subject to adjustment based on the achievement of certain future gross revenues and successful completion of certain pre-acquisition withholding tax issues of Concepts and Solutions. Solutions and Concepts are Utah-based audio design and manufacturing companies creating innovative products that provide fundamental tools for building notification systems primarily to K-12 education market customers located primarily in the north and northwest United States. Solutions and Concepts' products and services allow institutions access to intercom, scheduling, and notification systems with improved ease of use. The products provide an open architecture solution to customers which allows the products to be used in both existing and new environments. Intercom, public announcement (PA), bell and control solutions are easily added and integrated within the open architecture design and software model. These products combine elements over a common internet protocol (IP) network, which minimizes infrastructure requirements and reduces costs by combining systems. Galaxy is a manufacturer and U.S. distributor of interactive learning technology hardware and software that allows the presenter and participant to engage in a fully collaborative instructional environment. Galaxys products include Galaxys own private-label interactive touch screen panel as well as numerous other national and international branded peripheral and communication devices. New technologies like Galaxys own touchscreen panels are sold along with renowned brands such as Google Chromebooks, Microsoft Surface Tablets, Lenovo & Acer computers, Verizon WiFi and more. Galaxys distribution channel consists of approximately 30 resellers across the U.S. who primarily sell its products within the commercial and educational market. Galaxy does not control where the resellers focus their resell efforts; however, the K-12 education market is the largest customer base for Galaxy products comprising nearly 90% of Galaxys sales. In addition, Galaxy also possesses its own reseller channel where it sells directly to the K-12 market, primarily throughout the Southeast region of the United States. As disclosed in Note 12, the Entertainment segment was sold on February 6, 2019 in exchange for 38,625 Galaxy common shares. Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America. Any reference in these footnotes to applicable guidance is meant to refer to the authoritative U.S. generally accepted accounting principles (GAAP) as found in the Accounting Standards Codification (ASC) and Accounting Standards Update (ASU) of the Financial Accounting Standards Board (FASB). The financial statements include the consolidated assets and liabilities of the combined company (collectively Galaxy Next Generation, Inc., FullCircle Registry, Inc., FullCircle Entertainment, Inc., Interlock Concepts, Inc., and Ehlert Solutions Group, Inc. referred to collectively as the Company). See Note 12. All intercompany transactions and accounts have been eliminated in the consolidation. The Company is an over-the-counter public company traded under the stock symbol listing GAXY (formerly FLCR). Use of Estimates The preparation of consolidated financial statements in accordance with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates used in preparing the consolidated financial statements include those assumed in computing product warranty liabilities, product development costs, valuation of goodwill and intangible assets, valuation of convertible notes payable and warrants, and the valuation of deferred tax assets. It is reasonably possible that the significant estimates used will change within the next year. Capital Structure The Companys capital structure is as follows: June 30, 2020 Authorized Issued Outstanding Common stock 4,000,000,000 628,039,242 628,000,617 $.0001 par value, one vote per share Preferred stock 200,000,000 - - $.0001 par value, one vote per share Preferred stock - Class A 750,000 - - $.0001 par value; no voting rights Preferred stock - Class B 1,000,000 - - Voting rights of 10 votes for 1 Preferred B share; 2% preferred dividend payable annually Preferred stock - Class C 9,000,000 - - $.0001 par value; 500 votes per share, convertible to common stock Preferred stock - Class D 1,000,000 - - $.0001 par value; no voting rights, convertible to common stock, mandatory conversion to common stock 18 months after issue Preferred stock - Class E 500,000 500,000 500,000 $.0001 par value; no voting rights, convertible to common stock June 30, 2019 Authorized Issued Outstanding Common stock 4,000,000,000 11,318,901 11,280,276 $.0001 par value, one vote per share Preferred stock 200,000,000 - - $.0001 par value, one vote per share Preferred stock - Class A 750,000 - - $.0001 par value; no voting rights Preferred stock - Class B 1,000,000 - - Voting rights of 10 votes for 1 Preferred B share; 2% preferred dividend payable annually Preferred stock - Class C 9,000,000 - - $.0001 par value; 500 votes per share, convertible to common stock There is no publicly traded market for the preferred shares. There are 16,305,023 issued common shares that are restricted as of June 30, 2020. The shares will become free-trading upon satisfaction of certain terms within the convertible debt agreements. Business Combinations The Company accounts for business combinations under the acquisition method of accounting. Under this method, acquired assets, including separately identifiable intangible assets, and any assumed liabilities are recorded at their acquisition date estimated fair value. The excess of purchase price over the fair value amounts assigned to the assets acquired and liabilities assumed represents the goodwill amount resulting from the acquisition. Determining the fair value of assets acquired and liabilities assumed involves the use of significant estimates and assumptions. Revenue Recognition Technology Interactive Panels and Related Products The Company derives revenue from the sale of interactive panels and other related products. Sales of these panels may also include optional equipment, accessories and services (installation, training and other services, maintenance and warranty services). Product sales and installation revenue are recognized when all of the following criteria have been met: (1) products have been shipped or customers have purchased and accepted title to the goods; service revenue for installation of products sold is recognized as the installation services are performed, (2) persuasive evidence of an arrangement exists, (3) the price to the customer is fixed, and (4) collectability is reasonably assured. Deferred revenue consists of customer deposits and advance billings of the Companys products where sales have not yet been recognized. Shipping and handling costs billed to customers are included in revenue in the accompanying statements of operations. Costs incurred by the Company associated with shipping and handling are included in cost of sales in the accompanying statements of operations. Sales are recorded net of sales returns and discounts, and sales are presented net of sales-related taxes. Because of the nature and quality of the Companys products, the Company provides for the estimated costs of warranties at the time revenue is recognized for a period of five years after purchase as a secondary warranty. The manufacturer also provides a warranty against certain manufacturing and other defects. As of June 30, 2020 and 2019, the Company accrued $102,350 and $82,350, respectively, for estimated product warranty claims, which is included in accrued expenses in the accompanying consolidated balance sheets. The accrued warranty costs are based primarily on historical warranty claims as well as current repair costs. There was $82,494 and $87,374 of warranty expense for the years ended June 30, 2020 and 2019, respectively. The Company negotiated a warranty settlement with one of its manufacturers. At June 30, 2020 and 2019, the Company accrued $124,437 and $209,316 payable to this manufacturer to be paid over 24 months. Product sales resulting from fixed-price contracts involve a signed contract for a fixed price or a binding purchase order to provide the Companys interactive panels and accessories. Contract arrangements exclude a right of return for delivered items. Product sales resulting from fixed-price contracts are generated from multiple-element arrangements that require separate units of accounting and estimates regarding the fair value of individual elements. The Company has determined that its multiple-element arrangements that qualify as separate units of accounting are product sales and (2) installation and related services. There is objective and reliable evidence of fair value for both the product sales and installation services and allocation of arrangement consideration for each of these units is based on their relative fair values. Each of these elements represent individual units of accounting, as the delivered item has value to a customer on a stand-alone basis. The Companys products can be sold on a stand-alone basis to customers which provides objective evidence of the fair value of the product portion of the multi-element contract, and thus represents the Companys best estimate of selling price. The fair value of installation services is separately calculated using expected costs of installation services. Many times, the value of installation services is calculated using price quotations from subcontractors to the Company who perform installation services on a stand-alone basis. The Company sells equipment with embedded software to its customers. The embedded software is not sold separately, and it is not a significant focus of the Companys marketing efforts. The Company does not provide post-contract customer support specific to the software or incur significant costs that are within the scope of FASB guidance on accounting for software to be leased or sold. Additionally, the functionality that the software provides is marketed as part of the overall product. The software embedded in the equipment is incidental to the equipment as a whole. Entertainment Theater Ticket Sales and Concessions Revenues are generated principally through admissions and concessions sales with proceeds received in cash or via credit card at the point of sale. Cash and Cash Equivalents The Company considers cash and cash equivalents to be cash in all bank accounts, including money market and temporary investments that have an original maturity of three months or less. From time to time, the Company has on deposit, in institutions whose accounts are insured by the Federal Deposit Insurance Corporation, funds in excess of the insured maximum. The at-risk amount is subject to significant fluctuation daily throughout the year. The Company has never experienced any losses related to these balances, and as such, the Company does not believe it is exposed to any significant risk. Accounts Receivable Accounts receivable is recognized when the Companys right to consideration is unconditional and is presented net of an allowance for doubtful accounts. Interest is not charged on past due accounts. Management reviews each receivable balance and estimates that portion, if any, of the balance that will not be collected. The carrying amount of accounts receivable is then reduced by an allowance based on managements estimate. Management deemed no allowance for doubtful accounts was necessary at June 30, 2020 and 2019. At June 30, 2020 and 2019, $670,031 and $247,007 of total accounts receivable were considered unbilled and recorded as deferred revenue. Inventories Inventory is stated at the lower of cost or net realizable value. Cost is determined on a first-in, first-out (FIFO) method of accounting. All inventory at June 30, 2020 and 2019, represents goods available for sale. Galaxy inventory is primarily comprised of interactive panels, audio and related accessories. Management estimates $67,635 and $20,000 of inventory reserves at June 30, 2020 and 2019, respectively. Property and Equipment Property and equipment are stated at cost less accumulated depreciation. Expenditures for repairs and maintenance are charged to expense as incurred and additions and improvements that significantly extend the lives of assets are capitalized. Upon sale or other retirement of depreciable property, the cost and accumulated depreciation are removed from the related accounts and any gain or loss is reflected in operations. Property and equipment and the estimated useful lives used in computing depreciation, are as follows: Furniture and fixtures 5 years Equipment 5 to 8 years Vehicles 5 years Building 40 years Building improvements 8 years Depreciation is provided using the straight-line method over the estimated useful lives of the depreciable assets. Depreciation expense was $29,795 and $221,260 for the years ended June 30, 2020 and 2019, respectively. Long-lived Assets Long-lived assets to be held and used are tested for recoverability whenever events or changes in circumstances indicate that the related carrying amount may not be recoverable. When required, impairment losses on assets to be held and used are recognized based on the excess of the assets carrying amount over the fair value of the asset. Goodwill Goodwill is attributed to the reverse merger of FullCircle Registry and the acquisition of Concepts and Solutions. Goodwill is reviewed for impairment at least annually, or more frequently when events or changes in circumstances indicate that the carrying value may not be recoverable. Judgments regarding indicators of potential impairment are based on market conditions and operational performance of the business. The Company may assess its goodwill for impairment initially using a qualitative approach to determine whether conditions exist to indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying value. If management concludes, based on its assessment of relevant events, facts and circumstances that it is more likely than not that a reporting units carrying value is greater than its fair value, then a goodwill impairment charge is recognized for the amount in excess, not to exceed the total amount of goodwill allocated to that reporting unit. If the fair value of a reporting unit exceeds its carrying amount, goodwill is not considered to be impaired and no further testing is required. If determined to be impaired, an impairment charge is recorded as a general and administrative expense within the Companys consolidated statement of operations. Management determined that a triggering event to assess goodwill impairment occurred in an interim period during the year ending June 30, 2020 due to the separation of a key executive associated with the acquisition of Concepts and Solutions. While there was no single determinative event, the consideration in totality of several factors that developed during the year of 2020 led management to conclude that it was more likely than not that the fair values of certain intangible assets and goodwill acquired as part of the Ehlert Solutions Group, Inc and Interlock Concepts, Inc acquisitions were below their carrying amounts. These factors included: a) former key executive separating from us; b) respective former key executive violating his noncompete changing the use and value of it; c) sustained decrease in our share price which reduced market capitalization; and d) uncertainty in the United States and global economies beginning in March 2020 due to the COVID-19 pandemic. As a result of the impairment test, the audited results for the year ended 2020 included non- cash impairment losses of $2,000,287, comprised of $800,287 related to goodwill and $1,200,000 related to finite-lived intangible assets. Intangible Assets Intangible assets are stated at the lower of cost or fair value. Intangible assets are amortized on a straight-line basis over periods ranging from two to five years, representing the period over which the Company expects to receive future economic benefits from these assets. The Company acquired intangible assets related to the acquisition of Concepts and Solutions. The Company impaired $1,200,000 of the intangible assets during an interim period of the year ended June 30, 2020. There were no further indicators of impairment of intangible assets as of June 30, 2020. Goodwill and intangible assets are comprised of the following at June 30, 2020: Cost Accumulated Amortization Net Book Value Impairment Total Goodwill $ 1.634.507 $ - $1,634,507 $ (800,287) $834,220 Finite-lived assets: Customer list $ 881,000 $ (132,147) $ 748,853 $ - $748,853 Vendor relationships 479,000 (71,847) 407,153 - 407,153 Noncompete agreement 1,600,000 (400,000) 1,200,000 (1,200,000) - Product development costs 81,845 (1,536) 280,309 - 280,309 $ 3,241,845 $ (605,530) $2,636,315 $(1,200,000) $1,436,315 Estimated amortization expense related to finite-lived intangible assets for the next five years is: $347,293 for fiscal year 2021, $353,660 for fiscal year 2022, $361,577 for fiscal year 2023, $290,432 for fiscal year 2024, and $288,890 for fiscal year 2025. There were no intangible assets as of June 30, 2019. Product Development Costs Costs incurred in designing and developing classroom technology products are expensed as research and development until technological feasibility has been established. Technological feasibility is established upon completion of a detail product design, or in its absence, completion of a working model. Upon the achievement of technological feasibility, development costs are capitalized and subsequently reported at the lower of unamortized cost or net realizable value. Managements judgment is required in determining whether a product provides new or additional functionality, the point at which various products enter the stages at which costs may be capitalized, assessing the ongoing value and impairment of the capitalized costs and determining the estimated useful lives over which the costs are amortized. Annual amortization expense is calculated based on the straight-line method over the products estimated economic lives. Amortization of product development costs incurred begins when the related products are available for general release to customers. Amortization of product development costs of $1,536 and $0 for the years ended June 30, 2020 and 2019, is included in cost of revenues in the Companys consolidated statement of operations. Research and Development Research and development costs are expensed as incurred and totaled $90,654 for the year ended June 30, 2020. There was no research and development costs for the year ended June 30, 2019. Warranty The Company negotiated a warranty settlement with one of its manufacturers. At June 30, 2020, the Company accrued $124,437 payable to this manufacturer, with $0 recorded as a long-term portion of vendor payable. At June 30, 2019 the Company accrued $209,316 payable to this manufacturer to be paid over twenty-four months, with $174,703 recorded as a long-term vendor payable. Leases The Companys leases relate primarily to corporate offices and warehouses. Effective July 1, 2019, the Company adopted the FASB guidance on leases (Topic 842), which requires leases with durations greater than twelve months to be recognized on the balance sheet. The Company adopted Topic 842 using the modified retrospective transition approach. Distinguishing Liabilities from Equity The Company relies on the guidance provided by ASC Topic 480, Distinguishing Liabilities from Equity, to classify certain convertible instruments. The Company first determines whether a financial instrument should be classified as a liability. The Company determines a liability classification if the financial instrument is mandatorily redeemable, or if the financial instrument, other than outstanding shares, embodies a conditional obligation that the Company must or may settle by issuing a variable number of its equity shares. If the Company determines that a financial instrument should not be classified as a liability, the Company determines whether the financial instrument should be presented between the liability section and the equity section of the balance sheet (temporary equity). The Company determines temporary equity classification if the redemption of the financial instrument is outside the control of the Company (i.e. at the option of the holder). Otherwise, the Company accounts for the financial instrument as permanent equity. Initial Measurement The Company records financial instruments classified as liability, temporary equity or permanent equity at issuance at the fair value, or cash received. Subsequent Measurement Financial Instruments Classified as Liabilities The Company records the fair value of financial instruments classified as liabilities at each subsequent measurement date. The changes in fair value of financial instruments classified as liabilities are recorded as other income (expense). Income Taxes The Company accounts for income taxes under the asset and liability method, whereby deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Current income taxes are recognized for the estimated income taxes payable or receivable on taxable income or loss from the current year and any adjustment to income taxes payable related to previous years. Current income taxes are determined using tax rates and tax laws that have been enacted or subsequently enacted by the year-end date. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse. Under the asset and liability method, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is recognized if it is more likely than not that some portion or all of the deferred tax asset will not be utilized. Stock-based Compensation The Company records stock-based compensation in accordance with the provisions set forth in ASC 718, Stock Compensation. ASC 718 requires companies to recognize the cost of employee services received in exchange for awards of equity instruments based upon the grant date fair value of those awards. The Company, from time to time, may issue common stock to acquire services or goods from non-employees. Common stock issued to persons other than employees or directors are recorded on the basis of their fair value. Earnings (Loss) per Share Basic and diluted earnings (loss) per common share is calculated using the weighted average number of common shares outstanding during the period. The Company's convertible notes and warrants are excluded from the computation of diluted earnings per share as they are anti-dilutive due to the Company's losses during those periods. Fair Value of Financial Instruments The Company categorized its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset. Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs. As of June 30, 2020 and 2019, the Company held certain financial assets and liabilities that are required to be measured at fair value on a recurring basis. All such assets and liabilities are considered to be Level 3 in the fair value hierarchy defined above. Derivative Liabilities The Company generally does not use derivative financial instruments to hedge exposures to cash flow or market risks. However, certain other financial instruments, such as warrants and embedded conversion features on the convertible debt, are classified as derivative liabilities due to protection provisions within the agreements. Such financial instruments are initially recorded at fair value using the Monte Carlo model and subsequently adjusted to fair value at the close of each reporting period. The Company accounts for derivative instruments and debt instruments in accordance with the interpretive guidance of ASC 815, ASU 2017-11, and associated pronouncements related to the classification and measurement of warrants and instruments with conversion features and anti-dilution clauses in agreements. Recent Accounting Pronouncements In January 2020, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2020-01, Investments - Equity Securities (Topic 321), Investments - Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) - Clarifying the Interactions between Topic 321, Topic 323, and Topic 815. The ASU is based on a consensus of the Emerging Issues Task Force and is expected to increase comparability in accounting for these transactions. ASU 2020-01 made targeted improvements to accounting for financial instruments, including providing an entity the ability to measure certain equity securities without a readily determinable fair value at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. Among other topics, the amendments clarify that an entity should consider observable transactions that require it to either apply or discontinue the equity method of accounting. For public business entities, the amendments in the ASU are effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. The Company is currently evaluating the impacts of adoption of the new guidance to its consolidated financial statements. In December 2019, the FASB issued ASU No. 2019-12 Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes ("ASU 2019-12") by removing certain exceptions to the general principles. The amendments will be effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption of the amendments is permitted. Depending on the amendment, adoption may be applied on a retrospective, modified retrospective or prospective basis. The Company is currently evaluating the impacts of adoption of the new guidance to its consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820), which removes, modifies and adds various disclosure requirements around the topic in order to clarify and improve the cost-benefit nature of disclosures. For example, disclosures around transfers between fair value hierarchy levels will be removed and further detail around changes in unrealized gains and losses for the period and unobservable inputs determining Level 3 fair value measurements will be added. Th |
Contract Balances
Contract Balances | 3 Months Ended |
Sep. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Contract Balances | Note 2 Contract Balances Contract assets and contract liabilities are as follows: September 30, 2020 June 30, 2020 Contract assets $ 756,800 $ - Contract liabilities 1,220,761 463,961 |
Property and Equipment
Property and Equipment | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Property, Plant and Equipment [Abstract] | ||
Property and Equipment | Note 3 - Property and Equipment Property and equipment are comprised of the following at: September 30, 2020 June 30, 2020 Vehicles $ 115,135 $ 115,135 Equipment 6,097 6,097 Furniture and fixtures 24,335 24,335 145,567 145,567 Accumulated depreciation (97,946) (93,518) Property and equipment, net $ 47,621 $ 52,049 | Note 2 Property and Equipment Property and equipment are comprised of the following at: 2020 2019 Vehicles $ 115,135 $ 74,755 Equipment 6,097 5,000 Furniture and fixtures 24,335 12,598 145,567 92,353 Accumulated depreciation (93,518) (65,588) Property and equipment, net $ 52,049 $ 26,765 As disclosed in Note 12, the net assets of the Entertainment segment were sold on February 6, 2019. |
Intangible Assets
Intangible Assets | 3 Months Ended |
Sep. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Note 4 - Intangible Assets Intangible assets are stated at the lower of cost or fair value. Intangible assets are amortized on a straight-line basis over five years, representing the period over which the Company expects to receive future economic benefits from these assets. The following tables shows goodwill, finite-lived intangible assets, accumulated amortization, and the impairment charges: September 30, 2020 Cost Accumulated Amortization Net Book Value Impairment Total Goodwill $ 834,220 $ - $ 834,220 $ - $ 834,220 Finite-lived assets: Customer list $ 881,000 $ (168,293) $ 712,707 $ - $ 712,707 Vendor relationships 471,096 (95,797) 375,299 - 375,299 Capitalized product development costs 281,845 (14,048) 267,797 - 267,797 $ 1,633,941 $ (278,138) $ 1,355,803 $ - $1,355,803 June 30, 2020 Cost Accumulated Amortization Net Book Value Impairment Total Goodwill $ 1,634,507 $ - $ 1,634,507 $ (800,287) $ 834,220 Finite-lived assets: Customer list $ 881,000 $ (132,147) $ 748,853 $ - $ 748,853 Vendor relationships 479,000 (71,847) 407,153 - 407,153 Noncompete agreements 1,600,000 (400,000) 1,200,000 (1,200,000) - Capitalized product development costs 281,845 (1,536) 280,309 - 280,309 $ 3,241,845 $ (605,530) $ 2,636,315 $(1,200,000) $1,436,315 Estimated amortization expense related to intangible assets for the next five years is as follows: Period ending September 30, 2021 $ 347,293 2022 353,660 2023 361,577 2024 276,383 2025 16,890 $ 1,355,803 |
Line of Credit
Line of Credit | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Line of Credit Facility [Abstract] | ||
Line of Credit | Note 5 - Lines of Credit The Company has an available $1,000,000 and $1,250,000 line of credit at September 30, 2020 and June 30, 2020, respectively, bearing interest at prime plus 0.5% (3.75% at September 30, 2020 and 4.25% at June 30, 2020). The line of credit was renewed in October 2020 at a reduced available credit line, change in collateral, and now expires on October 29, 2021. The renewed line of credit is collateralized by certain real estate owned by a family member of a stockholder, 50,000,000 shares of the Company's common stock par value $0.0001 per share (the "Common Stock") and the personal stock of two stockholders, and a key man life insurance policy. A minimum average bank balance of $50,000 was required on the line of credit agreement at June 30, 2020, but this requirement was removed as of September 30, 2020.The outstanding balance is $936,598 and $1,236,598 at September 30, 2020 and June 30, 2020, respectively. The Company has a $1,000,000 available credit line under an accounts receivable factoring agreement through July 30, 2022. No amounts were outstanding as of September 30, 2020. See Note 13. | Note 3 - Line of Credit The Company has a $1,250,000 line of credit bearing interest at prime plus 0.5% (4.25% and 6.0% at June 30, 2020 and 2019, respectively) which expires October 12, 2020. The line of credit is collateralized by certain real estate owned by a family member of a stockholder, 850,000 shares of the Company's common stock owned by two stockholders, personal guarantees of two stockholders, and a key man life insurance policy. A minimum average bank balance of $50,000 is required as part of the line of credit agreement. In addition, a 20% curtailment of the outstanding balance may occur in 2020. The outstanding balance was $1,236,598 and $1,230,550 at June 30, 2020 and 2019, respectively. |
Notes Payable
Notes Payable | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Debt Disclosure [Abstract] | ||
Notes Payable | Note 6- Notes Payable Long Term Notes Payable September 30, 2020 June 30, 2020 Note payable with a bank bearing interest at 4% and maturing on June 26, 2020. The note was renewed by the lender with a revised maturity of June 26, 2021 and a lowered interest rate to 3%. The renewal provides for monthly interest payments and a balloon payment of outstanding principal and interest at maturity. The note is collateralized by a certificate of deposit owned by a related party. $275,200 $274,900 Long term PPP loan under the CARES Act bearing interest at 0.98% and maturing in April 2022. Monthly installments of principal and interest of $13,137 begin in October 2020. The loan is subject to forgiveness by the SBA. 310,832 310,832 Long term loan under Section 7(b) of the Economic Injury Disaster Loan program bearing interest at 3.75% and maturing in May 2050. Monthly installments of principal and interest of $731 begin in May 2021. 150,000 150,000 Financing lease liabilities for offices and warehouses with monthly installments of $12,449 (ranging from $1,083 to $3,524) over terms expiring through July 2022. 249,299 223,982 Financing leases with a related party for delivery vehicles with monthly installments totaling $813, including interest, over 5-year terms expiring through July 2020. - 1,245 Note payable with a finance company for delivery vehicle with monthly installments totaling $679 including interest at 8.99% over a 6 year term expiring in December 2025. 33,245 34,019 Total Notes Payable 1,018,576 994,978 Current Portion of Notes Payable 570,962 512,425 Long-term Portion of Notes Payable $ 447,614 $ 482,553 Future minimum principal payments on the long-term notes payable to unrelated parties are as follows: Period ending September 30, 2021 $ 570,962 2022 247,194 2023 42,191 2024 10,230 2025 13,017 Thereafter 134,982 $ 1,018,576 Convertible Notes September 30, 2020 June 30, 2020 On March 28, 2019, the Company signed a convertible promissory note with an investor. The $225,000 note was issued at a discount of $20,000 and bears interest at 10% per year. The Company issued 25,000 common shares to the investor. Three draws of $56,250, $112,500, and $56,250 were borrowed under this note. The note principal and interest were convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of the common stock during the 20 trading days immediately preceding the notice of conversion or (b) $3 per share, beginning in September 2019. The note had prepayment penalties ranging from 110% to 125% of the principal and interest outstanding if repaid within 60 to 180 days from issuance. The note matured in three intervals in March 2020, June 2020, and November 2020. The note was repaid by conversion to stock. $ - $24,150 On November 18, 2019, the Company signed a convertible promissory note with an investor. The $110,000 note was issued at a discount of $10,000 and bore interest at 8% per year. The note principal and interest were convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of common stock during the 15 trading days prior to the issue date or (b) 70% of the lowest traded price for the common stock during the 15 trading days prior to conversion of the note. The note matures in November 2020. The note had prepayment penalties between 115% and 125% of the principal and interest outstanding if repaid before 180 days from issuance. The note was repaid by conversion to stock. - 1,000 On December 11, 2019, the Company signed a convertible promissory note with an investor. The $220,430 note was issued at a discount of $15,430 and bore interest at 8% per year. The note principal and interest were convertible into shares of common stock at the lower of (a) $0.46 per share or (b) 75% of the lowest trading price of common stock during the 10 trading days prior to conversion beginning in June 2020. The note matured in December 2020. The note had prepayment penalties between 120% and 130% of the principal and interest outstanding if repaid before 180 days from issuance. The note was repaid by conversion to stock. - 121,200 On November 25, 2019, the Company signed a convertible promissory note with an investor. The $1,000,000 note was issued at a discount of $70,000 and bore interest at 8% per year. The note principal and interest up to $250,000 every 30-day calendar period were convertible into shares of common stock at the lower of (a) 75% of the lowest traded price of the common stock during the 10 trading days immediately preceding the notice of conversion or (b) $0.46 per share. The note matures in November 2020. The note had a redemption premium of 115% of the principal and interest outstanding if repaid before maturity. The note was repaid by conversion to stock. - 825,000 On January 9, 2020, the Company entered into a $225,000 convertible note. The $225,000 note was issued at a discount of $13,500 and bore interest at 8% per year. The note principal and interest were convertible into shares of common stock at the lower of (a) 75% of the lowest traded price of the common stock during the 10 trading days immediately preceding the notice of conversion or (b) the lowest traded price of the common stock during the 10 trading days prior to the issuance of this note. The note matured in October 2020. The note had prepayment penalties of 110% to 125% of the principal and interest outstanding if repaid before 180 days from issuance. The principal amount of the note was increased by $25,000 due to the value of the stock price at conversion. The note was repaid by conversion to stock. - 250,000 On March 25, 2020 the Company signed a convertible promissory note with an investor. The $338,625 note was issued at a discount of $23,625 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) $0.46 per share or (b) 75% of the lowest trading price of common stock during the 10 trading days prior to conversion. The note matures in March 2021. The note has prepayment penalties between 120% and 130% of the principal and interest outstanding if repaid before 180 days from issuance. The note was partially repaid by conversion to stock. 75,465 338,625 On June 26, 2020 the Company signed a convertible promissory note with an investor. The $430,000 note was issued at a discount of $30,000 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) $0.47 per share or (b) 70% of the lowest trading price of common stock during the 10 trading days prior to conversion. The note matures in June 2021. The note has prepayment penalties between 120% and 130% of the principal and interest outstanding if repaid before 180 days from issuance. 430,000 430,000 On July 20, 2019, the Company signed a convertible promissory note with an investor. The $125,000 note was issued at a discount of $8,750 and bores interest at 8% per year. The note principal and interest were convertible into shares of common stock at the lower of (a) 80% of the lowest traded price of the common stock during the 10 trading days immediately preceding the notice of conversion or (b) $0.47 per share. The note matured in July 2021. The note had a redemption premium of 115% of the principal and interest outstanding if repaid before maturity. The note is secured by a security interest in all assets of the Company. The note was borrowed and repaid by conversion to stock during the three months ended September 30, 2020. - - On August 18, 2020, the Company signed a convertible promissory note with an investor. The $500,000 note was issued at a discount of $35,000 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) 80% of the lowest traded price of the common stock during the 10 trading days immediately preceding the notice of conversion or (b) $0.47 per share. The note matures in August 2021. The note has a redemption premium of 115% of the principal and interest outstanding if repaid before maturity. The note is secured by a security interest in all assets of the Company. The note was partially repaid by conversion to stock during the three months ended September 30, 2020. 325,000 - On July 20, 2020 the Company signed a convertible promissory note with an investor. The $134,375 note was issued at a discount of $9,375 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) $0.47 per share or (b) 70% of the lowest trading price of common stock during the 10 trading days prior to conversion. The note matures in July 2021. The note contains a price protection clause where if the share price falls below $0.01 per share after six months, the conversion price discount increases by 5%. The note has prepayment penalties between 120% and 130% of the principal and interest outstanding if repaid before 180 days from issuance. 134,375 - On July 24, 2020, the Company entered into a $168,300 convertible note. The note was issued at a discount of $15,300 and bears interest at 12% per year. The note principal and interest are convertible into shares of common stock at 71% of the average of the lowest 2 trading prices during 15 trading days prior to conversion. The note matures in July 2021. The note has prepayment penalties of 110% to 125% of the principal and interest outstanding if repaid before 180 days from issuance. 168,300 - Total Convertible Notes Payable 1,133,140 1,989,975 Less: Unamortized original issue discounts 455,594 888,075 Current Portion of Convertible Notes Payable 677,546 1,101,900 Long-term Portion of Convertible Notes Payable $ - $ - The original issue discount is being amortized over the terms of the convertible notes using the effective interest method. During the three months ended September 30, 2020 and 2019, the Company amortized $34,250 and $60,268, respectively, of debt discounts to interest expense and $399,936 and $228,933, respectively,to interest accretion. One convertible promissory note for $125,000 was entered into during the three months ended September 30, 2020, and subsequently repaid prior to September 30, 2020. Convertible notes are subordinate to the bank debt of the Company. Accrued but unpaid interest on the notes is convertible by the lender into,and payable by the Company in common shares at a price per common share equal to the most recent closing price of the Company's common shares prior to the delivery to the Company of a request to convert interest, or the due date of interest, as applicable. Interest, when due, is payable either in cash or common shares. The conversion features meet the definition of a derivative liability instrument because the conversion rate is variable and therefore does not meet the"fixed-for-fixed"criteria outlined in ASC 815-40-15. As a result, the conversion features of the notes are recorded as a derivative liability at fair value and marked-to-market each period with the changes in fair value each period charged or credited to other income (expense). Warrants The warrants meet the definition of a derivative liability instrument because the exercise price is variable and therefore does not meet the "fixed-for-fixed" criteria outlined in ASC 815-40-15. As a result, the value of unexercised warrants was recorded as a derivative liability at fair value and marked-to-market each period with the changes in fair value each period charged or credited to other income (expense). | Note 4 - Notes Payable Long Term Notes Payable The Company's long term notes payable obligations to unrelated parties are as follows at: 2020 2019 Note payable with a bank maturing on June 26, 2021 due to an extension, bearing interest at 3% and 4% for the years ended June 20, 2020 and 2019, respectively. Monthly interest payments of approximately $697 are due beginning July 26, 2020. The note is guaranteed by a stockholder and collateralized by a certificate of deposit owned by a related party. $ 274,900 $ 274,900 Long term PPP loan under the CARES Act bearing interest at 0.98% and maturing in April 2022. Monthly installments of principal and interest of $13,137 begin in October 2020. The loan is subject to forgiveness by the SBA. 310,832 - Long term loan under Section 7(b) of the Economic Injury Disaster Loan program bearing interest at 3.75% and maturing in May 2050. Monthly installments of principal and interest of $731 begin in May 2021. 150,000 - Financing lease liabilities for offices and warehouses with monthly installments of $19,173 (ranging from $1,083 to $4,806) over two year terms, expiring through July 2022. 223,982 - Financing leases with a related party for delivery vehicles with monthly installments totaling $813 (ranging from $352 to $461), including interest (ranging from 4.5% to 4.75%), over 5-year terms expiring through July 2020. One of the financing leases was paid in full in July 2019 leaving one delivery vehicle financing lease remaining. 1,245 6,053 Note payable with a finance company for delivery vehicle with monthly installments totaling $679 including interest at 8.99% over a 6 year term expiring in December 2025. Total Notes Payable 994,978 280,953 Current Portion of Notes Payable 512,425 279,346 Long-term Portion of Notes Payable $ 482,553 $ 1,607 Future minimum principal payments on the non-related party long term notes payable are as follows: Year ending June 30, 2021 $ 512,425 2022 229,962 2023 93,555 2024 10,045 2025 10,807 Thereafter 138,184 $ 994,978 Convertible Notes Payable June 30,2020 June 30, 2019 On January 16, 2019, the Company signed a convertible promissory note with an investor. The $382,000 note was issued at a discount of $38,200 and bears interest at 12% per year. The Company issued 92,271 common shares to the investor. The note principal and interest are convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of the common stock during the 20 trading days immediately preceding the notice of conversion or (b) $3 per share, beginning in June 2019. The note matured in July 2019 and was converted to equity. $ - $ 382,000 On February 22, 2019, the Company signed a convertible promissory note with an investor. The $200,000 note was issued at a discount of $20,000 and bears interest at 5% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of the common stock during the 20 trading days immediately preceding the notice of conversion or (b) $3 per share, beginning in August 2019. The note was paid in full by partial conversion to stock and proceeds from issuance of debt. - 200,000 On March 28, 2019, the Company signed a convertible promissory note with an investor. The $225,000 note was issued at a discount of $20,000 and bears interest at 10% per year. The Company issued 25,000 common shares to the investor. Three draws of $56,250, $112,500, and $56,250 were borrowed under this note. The note principal and interest are convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of the common stock during the 20 trading days immediately preceding the notice of conversion or (b) $3 per share, beginning in September 2019. The note has prepayment penalties ranging from 110% to 125% of the principal and interest outstanding if repaid within 60 to 180 days from issuance. The note matures in three intervals in March 2020, June 2020, and November 2020. The note was partially repaid by conversion to stock. 24,150 168,750 On April 1, 2019, the Company signed a convertible promissory note with an investor. The $225,000 note was issued at a discount of $25,000 and bears interest at 10% per year. The Company issued 25,000 shares to the investor. An initial draw of $100,000 was borrowed under this note. The note principal and interest are convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of the common stock during the 20 trading days immediately preceding the notice of conversion. The note matures in April 2020. The note has prepayment penalties ranging from 110% to 125% of the principal and interest outstanding if repaid within 60 to 180 days from issuance. The note was paid in full by conversion to stock. - 112,500 On April 29, 2019, the Company signed a convertible promissory note with an investor. The $1,325,000 note was issued at a discount of $92,750 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) 75% of the lowest traded price of the common stock during the 10 trading days immediately preceding the notice of conversion or (b) $2.75 per share. The note matures in April 2020. The note has prepayment penalties of 120% of the sum of the outstanding principal, plus accrued interest, plus defaulted interest, plus any additional principal, plus at the holder's option, any amounts owed to the holder pursuant to any other provision of the note. The note was paid in full with proceeds from issuance of debt and preferred stock. - 1,325,000 On May 28, 2019, the Company signed a convertible promissory note with an investor. The $322,580 note was issued at a discount of $22,580 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) 75% of the lowest traded price of the common stock during the 10 trading days immediately preceding the notice of conversion or (b) $2.75 per share beginning in November 2019. The note matures in May 2020. The note has prepayment penalties of 120% of the principal and interest outstanding if repaid before 180 days from issuance. The note was repaid by a combination of conversion to stock and cash. - 322,580 On June 18, 2019, the Company signed a convertible promissory note with an investor. The $366,120 note was issued at a discount of $27,120 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at 75% of the lowest traded price of the common stock during the 10 trading days immediately preceding the notice of conversion. The note matures in May 2020. The note has prepayment penalties of 120% of the principal and interest outstanding if repaid before 180 days from issuance. The note was repaid by conversion to stock. - 366,120 On August 6, 2019, the Company signed a convertible promissory note with an investor. The $220,000 note was issued at a discount of $20,000 and bears interest at 12% per year. The note principal and interest are convertible into shares of common stock at 75% of the lowest traded price of the common stock during the 10 trading days immediately preceding the notice of conversion. The note matures in August 2020. The note has prepayment penalties of 120% of the principal and interest outstanding if repaid before 180 days from issuance. The note was repaid by conversion to stock. - - On August 29, 2019, the Company signed a convertible promissory note with an investor. The $234,726 note was issued at a discount of $16,376 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at 75% of the lowest traded price of the common stock during the 10 trading days immediately preceding the notice of conversion. The note matures in August 2020. The note has prepayment penalties of 120% of the principal and interest outstanding if repaid before 180 days from issuance. The note was repaid by conversion to stock. - - On November 18, 2019, the Company signed a convertible promissory note with an investor. The $55,000 note was issued at a discount of $5,000 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of common stock during the 15 trading days prior to the issue date or (b) 70% of the lowest traded price for the common stock during the 15 trading days prior to conversion of the note. The note matures in November 2020. The note has prepayment penalties between 115% and 125% of the principal and interest outstanding if repaid before 180 days from issuance. The note was repaid by conversion to stock. - - On November 18, 2019, the Company signed a convertible promissory note with an investor. The $110,000 note was issued at a discount of $10,000 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of common stock during the 15 trading days prior to the issue date or (b) 70% of the lowest traded price for the common stock during the 15 trading days prior to conversion the note. The note matures in November 2020. The note has prepayment penalties between 115% and 125% of the principal and interest outstanding if repaid before 180 days from issuance. The note was partially repaid by conversion to stock. 1,000 - On December 11, 2019, the Company signed a convertible promissory note with an investor. The $220,430 note was issued at a discount of $15,430 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) $0.46 per share or (b) 75% of the lowest trading price of common stock during the 10 trading days prior to conversion beginning in June 2020. The note matures in December 2020. The note has prepayment penalties between 120% and 130% of the principal and interest outstanding if repaid before 180 days from issuance. The note was partially repaid by conversion to stock. 121,200 - On November 25, 2019, the Company signed a convertible promissory note with an investor. The $1,000,000 note was issued at a discount of $70,000 and bears interest at 8% per year. The note principal and interest up to $250,000 every 30-day calendar period are convertible into shares of common stock at the lower of (a) 75% of the lowest traded price of the common stock during the 10 trading days immediately preceding the notice of conversion or (b) $0.46 per share. The note matures in November 2020. The note has a redemption premium of 115% of the principal and interest outstanding if repaid before maturity. The note was partially repaid by conversion to stock. 825,000 - On January 9, 2020, the Company entered into a $225,000 convertible note. The $225,000 note was issued at a discount of $13,500 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) 75% of the lowest traded price of the common stock during the 10 trading days immediately preceding the notice of conversion or (b) the lowest traded price of the common stock during the 10 trading days prior to the issuance of this note. The note matures in October 2020. The note has prepayment penalties of 110% to 125% of the principal and interest outstanding if repaid before 180 days from issuance. The note was increased by $25,000 due to the value of the stock price at conversion. 250,000 - On January 27, 2020, the Company entered into a $223,300 convertible note. The $223,300 note was issued at a discount of $20,300 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at 75% of the average of the lowest 3 trading prices during 15 trading days prior to conversion. The note matures in January 2021. The note has prepayment penalties of 110% to 125% of the principal and interest outstanding if repaid before 180 days from issuance. The note was repaid by conversion to stock. - - On March 25, 2020 the Company signed a convertible promissory note with an investor. The $338,625 note was issued at a discount of $23,625 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) $0.46 per share or (b) 75% of the lowest trading price of common stock during the 10 trading days prior to conversion. The note matures in March 2021. The note has prepayment penalties between 120% and 130% of the principal and interest outstanding if repaid before 180 days from issuance. 338,625 - On June 26, 2020 the Company signed a convertible promissory note with an investor. The $430,000 note was issued at a discount of $30,000 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) $0.47 per share or (b) 70% of the lowest trading price of common stock during the 10 trading days prior to conversion. The note matures in June 2021. The note has prepayment penalties between 120% and 130% of the principal and interest outstanding if repaid before 180 days from issuance. 430,000 - Total Convertible Notes Payable 1,989,975 2,876,950 Less: Unamortized original issue discounts 888,075 752,126 Current Portion of Convertible Notes Payable 1,101,900 2,124,824 Long-term Portion of Convertible Notes Payable $ - $ - The original issue discount is being amortized over the terms of the convertible notes using the effective interest method. During the years ended June 30, 2020 and 2019, the Company amortized $340,526 and $89,279 of debt discounts to interest expense and $1,825,506 and $644,055 to interest accretion. Four convertible promissory notes were entered into during the year ended June 30, 2020, and subsequently repaid prior to June 30, 2020. The Company incurred prepayment penalties of approximately $139,000 due to the advance repayment of two of these convertible notes. Two convertible promissory notes were entered into during the year ended June 30, 2019, and subsequently repaid in advance of maturity prior to June 30, 2019. Significant noncash transactions involving interest expense during the year ended June 30, 2019 included prepayment penalty interest of $134,461 due to the advance repayment of two convertible notes. Convertible notes are subordinate to the bank debt of the Company. Accrued but unpaid interest on the notes is convertible by the lender into, and payable by the Company in common shares at a price per common share equal to the most recent closing price of the Companys common shares prior to the delivery to the Company of a notice of conversion, or the due date of interest, as applicable. Interest, when due, is payable either in cash or common shares. The conversion features meet the definition of a derivative liability instrument because the conversion rate is variable and therefore does not meet the fixed-for-fixed criteria outlined in ASC 815-40-15. As a result, the conversion features of the notes are recorded as a derivative liability at fair value and marked-to-market each period with the changes in fair value each period charged or credited to other income (expense). Warrants The Company issued common stock and warrants as consideration for the convertible notes. The warrants contain certain anti-dilutive clauses that are accounted for as financial derivatives. See Note 8 for common stock issued. Unexercised warrants of 204,771,864 after anti-dilution protection adjustment, are outstanding at June 30, 2020. All outstanding warrants have an original exercise prices of $4 per share, contain anti-dilution protection clauses, and expire 36 months from issue date. The anti-dilution clause was triggered for outstanding warrants, which now have an exercise price below $4 per share. As of June 30, 2020, outstanding warrants expire between November 29, 2021 and November 18, 2022. The warrants meet the definition of a derivative liability instrument because the exercise price is variable and therefore does not meet the fixed-for-fixed criteria outlined in ASC 815-40-15. As a result, the value of unexercised warrants are recorded as a derivative liability at fair value and marked-to-market each period with the changes in fair value each period charged or credited to other income (expense). |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | ||
Fair Value Measurements | Note 7 Fair Value Measurements The following table presents information about the assets and liabilities that are measured at fair value on a recurring basis at September 30, 2020 and June 30, 2020 and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value. At September 30, 2020 Total Level 1 Level 2 Level 3 Assets Customer List $704,803 - - $704,803 Vendor Relationship 383,203 - - 383,203 Development Costs 287,797 - - 287,797 $1,355,803 - - $1,355,803 Liabilities Original Issue discount, convertible debt $1,276,312 - - $1,276,312 At June 30, 2020 Total Level 1 Level 2 Level 3 Assets Customer list $748,847 - - $748,847 Vendor relationship 407,153 - - 407,153 Development costs 280,315 - - 280,315 $1,436,315 - - $1,436,315 Liabilities Original issue discount, convertible debt $213,300 - - $213,300 Derivative liability warrants 33,312 - - 33,312 Total $246,612 - - $246,612 As of September 30, 2020 and June 30, 2020, the only asset required to be measured on a nonrecurring basis was goodwill and the fair value of the asset amounted to $834,220 using level 3 valuation techniques. The Company measures the fair market value of the Level 3 liability components using the Monte Carlo model and projected discounted cash flows, as appropriate. These models were prepared by an independent third party and consider management's best estimate of the conversion price of the stock, an estimate of the expected time to conversion, an estimate of the stock's volatility, and the risk-free rate of return expected for an instrument with a term equal to the duration of the convertible note. The derivative liability was valued using the Monte Carlo pricing model with the following inputs: At September 30, 2020 Risk-free interest rate: 0.08% Expected dividend yield: 0.00% Expected stock price volatility: 325.00% Expected option life in years: 0.48 to 1.44 years At June 30, 2020 Risk-free interest rate: 0.09% Expected dividend yield: 0.00% Expected stock price volatility: 300.00% Expected option life in years: .085 to 1.69 years The following table sets forth a reconciliation of changes in the fair value of the Company's convertible debt components classified as Level 3 in the fair value hierarchy at September 30, 2020 and June 30, 2020: Balance at June 30, 2020 $ 246,612 Additional convertible securities at inception 2,000 Realized (5,300) Unrealized 1,033,000 Ending balance at September 30, 2020 $ 1,276,312 Balance at June 30, 2019 $ 1,025,944 Additional convertible securities at inception 2,027,000 Settlement of conversion features and warrants (152,374) Realized (240,903) Unrealized (2,413,055) Ending balance at June 30, 2020 $ 246,612 | Note 5 Fair Value Measurements The following table presents information about the assets and liabilities that are measured at fair value on a recurring basis at June 30, 2020 and 2019 and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value. At June 30, 2020 Assets: Total Level 1 Level 2 Level 3 Goodwill $ 834,220 $ - $ - $ 834,220 Customer list 748,853 - - 748,853 Vendor relationship 407,153 - - 407,153 Development costs 280,315 - - 280,315 $1,990,226 $ - $ - $1,990,226 Liabilities: Original issue discount, convertible debt $ 213,300 $ - $ - $ 213,300 Derivative liability, warrants 33,312 - - 33,312 Total: $ 246,612 $ - $ - $ 246,612 At June 30, 2019 Liabilities: Total Level 1 Level 2 Level 3 Original issue discount, convertible debt $979,569 $ - $ - $ 979,569 Derivative liability, warrants 46,375 - - 46,375 Total: $ 1,025,944 $- $- $ 1,025,944 As of June 30, 2020, the only asset required to be measured on a nonrecurring basis was goodwill and the fair value of the asset amounted to $834,220 using level 3 valuation techniques. The Company measures the fair market value of the Level 3 liability components using the Monte Carlo model and projected discounted cash flows, as appropriate. These models were initially prepared by an independent third party and consider managements best estimate of the conversion price of the stock, an estimate of the expected time to conversion, an estimate of the stocks volatility, and the risk-free rate of return expected for an instrument with a term equal to the duration of the convertible note. The significant unobservable valuation inputs for the convertible notes include an expected rate of return of 0%, a risk-free rate of 0.09% and volatility of 300%. The derivative liability was valued using the Monte Carlo pricing model with the following inputs: At June 30, 2020 Risk-free interest rate: 0.09% Expected dividend yield: 0.00% Expected stock price volatility: 300.00% Expected option life in years: .089 to 1.69 years At June 30, 2019 Risk-free interest rate: 1.72 -2.83% Expected dividend yield: 0.00% Expected stock price volatility: 180.00% Expected option life in years: 2.80 to 3.00 years The following table sets forth a reconciliation of changes in the fair value of the Companys convertible debt components classified as Level 3 in the fair value hierarchy at June 30, 2020: Balance at June 30, 2019 $ 1,025,944 Convertible securities at inception 2,027,000 Settlement of conversion features and warrants (152,374) Realized (240,903) Unrealized (2,413,055) Balance at June 30, 2020 $ 246,612 Balance at June 30, 2018 $ - Convertible securities at inception 1,238,359 Settlement of conversion features and warrants (301,613) Realized (83,487) Unrealized 172,685 Balance at June 30, 2019 $ 1,025,944 |
Related Party Transactions
Related Party Transactions | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Related Party Transactions [Abstract] | ||
Related Party Transactions | Note 8- Related Party Transactions Notes Payable September 30, 2020 June 30, 2020 Note payable to a stockholder in which the $200,000 principal plus $10,000 of interest was payable in December 2019. Borrowings under the note increased to $400,000 and the maturity was extended to November 2021. The note bears interest at 6% interest and is payable in cash or common stock, at the Company's option. If interest is paid in common stock, the conversion price will be the market price at the time of conversion. Principal on the note at maturity is convertible into 400,000 shares of Series D Preferred Stock. If principal is paid prior to maturity, the right of conversion is terminated. $400,000 $400,000 Fair value of unsecured notes payable to seller of Concepts and Solutions, a related party, bearing interest at 3% per year, payable in annual installments through November 30, 2021. Payments are subject to adjustment based on the achievement of minimum gross revenues and successful completion of certain pre-acquisition withholding tax issues of Concepts and Solutions. 1,030,079 1,030,079 Note payable to a stockholder in which the note principal plus 6% interest is payable in November 2021. Note was amended in March 2020 by increasing the available borrowings to $1,225,000 and extending the maturity to March 2022. Interest is payable in cash or common stock, at the holder's option. If interest is paid in common stock, the conversion price will be the market price at the time of conversion. Principal on the note at maturity is convertible into 1,000,000 shares of Series D Preferred Stock. If principal is paid prior to maturity, the right of conversion is terminated. 1,225,000 1,225,000 Note payable to a stockholder in which the note principal plus 6% interest is payable in November 2021. Interest is payable in cash or common stock, at the Company's option. If interest is paid in common stock, the conversion price will be the market price at the time of conversion. Principal on the note at maturity is convertible into 200,000 shares of Series D Preferred Stock. If principal is paid prior to maturity, the right of conversion is terminated. 200,000 200,000 Note payable to a stockholder in which the note principal plus interest at 10% is payable the earlier of 60 days after invoicing a certain customer, or April 2021, due to an extension granted by the lender. The note is collateralized by a security interest in a certain customer purchase order. 385,000 385,000 Other short term payables due to stockholders and related parties 74,323 107,733 Total Related Party Notes Payable and Other Payables 3,314,402 3,347,812 Current Portion of Related Party Notes Payable and Other Payables 1,239,402 1,272,812 Long-term Portion of Related Party Notes Payable and Other Payables $2,075,000 $2,075,000 Future maturities of related party notes payable are as follows: Period ending September 30, 2021 $ 1,239,402 2022 2,075,000 $3,314,402 Leases The Company leases property used in operations from a related party under terms of a financing lease. The term of the lease expires on December 31, 2021. The monthly lease payment is $1,500 plus maintenance and property taxes, as defined in the lease agreement. Rent expense for this lease was $4,500 for the three months ended September 30, 2020 and 2019, respectively. Other Agreements A related party collateralizes the Company's short-term note with a certificate of deposit in the amount of $274,900, held at the same bank. The related party will receive a $7,500 collateral fee for this service (see Note 6). | Note 6 - Related Party Transactions Notes Payable The Company's notes payable obligations to related parties are as follows: June 30, 2020 June 30, 2019 Note payable to a stockholder in which the $200,000 principal plus $10,000 of interest was payable in December 2019. Borrowings under the note increased and the maturity was extended to November 2021. The note bears interest at 6% interest and is payable in cash or common stock, at the Company's option. If interest is paid in common stock, the conversion price will be the market price at the time of conversion. Principal on the note at maturity is convertible into 400,000 shares of Series D Preferred Stock. If principal is paid prior to maturity, the right of conversion is terminated. 400,000 $ 200,000 Fair value of unsecured notes payable to seller of Concepts and Solutions, a related party, bearing interest at 3% per year, payable in annual installments through November 30, 2021. Payments are subject to adjustment based on the achievement of minimum gross revenues and successful completion of certain pre-acquistion withholding tax issues of Concepts and Solutions. 1,030,079 - Note payable to a stockholder in which the note principal plus 6% interest is payable in November 2021. Note was amended in March 2020 by increasing the balance by $225,000 and extending the maturity to March 2022. Interest is payable in cash or common stock, at the holders option. If interest is paid in common stock, the conversion price will be the market price at the time of conversion. Principal on the note at maturity is convertible into 1,000,000 shares of Series D Preferred Stock. If principal is paid prior to maturity, the right of conversion is terminated. 1,225,000 - Note payable to a stockholder in which the note principal plus 6% interest is payable in November 2021. Interest is payable in cash or common stock, at the Company's option. If interest is paid in common stock, the conversion price will be the market price at the time of conversion. Principal on the note at maturity is convertible into 200,000 shares of Series D Preferred Stock. If principal is paid prior to maturity, the right of conversion is terminated. 200,000 - Note payable to a stockholder in which the note principal plus interest at 10% is payable the earlier of 60 days after invoicing a certain customer, or August 20, 2020. On August 20, 2020, the interest on the note was paid and the note was renewed with an extension of the maturity date to March 30, 2021. The note is collateralized by a security interest in a certain customer purchase order. 385,000 - Other short term payables due to stockholders and related parties 107,733 - Total Related Party Notes Payable and Other Payables 3,347,812 200,000 Current Portion of Related Party Notes Payable and Other Payables 1,272,812 200,000 Long-term Portion of Related Party Notes Payable and Other Payables 2,075,000 $ - Leases The Company leases property used in operations from a related party under terms of an operating lease. The term of the lease expires on December 31, 2021. The monthly lease payment is $1,500 plus maintenance and property taxes, as defined in the lease agreement. Rent expense for this lease was $18,000 and $9,000 for the years ended June 30, 2020 and 2019, respectively. The Company leases a vehicle from related parties under a financing lease (Note 4). The Company is paying the lease payments directly to the creditors, rather than the lessor. The leased vehicle is used in operations for deliveries and installations. Other Agreements A related party collateralizes the Companys short-term note with a certificate of deposit in the amount of $274,900, held at the same bank. The related party will receive a $7,500 collateral fee for this service (see Note 4). |
Lease Agreements
Lease Agreements | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Leases [Abstract] | ||
Lease Agreements | Note 9- Lease Agreements The Company has financing lease liabilities for offices and warehouses with monthly installments of $12,449 (ranging from $1,083 to $3,524) including imputed interest (ranging from 0% to 2%), over 2 year terms plus extensions, expiring through July 2022. Right-of-use assets: Operating right-of-use assets $249,299 Operating lease liabilities: Current portion of long term payable 135,099 Financing leases payable, less current portion 114,200 Total financing lease liabilities $249,299 As of September 30, 2020, financing lease maturities are as follows: Period ending September 30, 2021 $135,099 2022 81,523 2022 32,677 $249,299 As of September 30, 2020, the weighted average remaining lease term was 1.67 years. | Note 7 - Lease Agreements Financing Lease Agreements The Company leases vehicles under financing lease agreements (Note 4) requiring monthly payments totaling $813 (ranging from $263 to $461), including interest (ranging from 4.5% to 4.75%), over 5-year terms expiring through July 2020. The Company has financing lease liabilities for offices and warehouses with monthly installments of $19,173 (ranging from $1,083 to $4,806) over 2 year terms, expiring through July 2022. Right of use assets Operating right of use assets $ 223,982 Operating lease liabilities Current portion of long term notes payable 114,288 Notes payable, less current portion 109,694 Total operating lease liabilities $ 223,982 As of June 30, 2020, operating lease maturities are as follows: Period ending June 30, 2021 $ 114,288 2022 109,694 $ 223,982 As of June 30, 2020, the weighted average remaining lease term was 1.75 years. |
Equity
Equity | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Stockholders' Equity Note [Abstract] | ||
Equity | Note 10 - Equity During the three months ended September 30, 2020, the Company issued 103,750,000 shares of common stock for professional consulting services. These shares were valued at $2,763,000 upon issuance during the three months ended September 30, 2020. During the three months ended September 30, 2020, the Company issued 968,475,442 shares of common stock for debt reduction. These shares were valued at $7,974,206 upon issuance during the three months ended September 30, 2020. During the three months ended September 30, 2020, the Company issued 249,792,217 shares of common stock to warrant holders in six cashless transactions. During the three months ended September 30, 2020, the Company issued 2,500,000 shares of common stock for commitment shares under a two year purchase agreement entered into on May 31, 2020 between the Company and an investor, as amended and restated on July 9, 2020 (the "Put Purchase Agreement"). These shares were valued at $55,000 upon issuance during the three months ended September 30, 2020. During the three months ended September 30, 2020, the Company issued 242,000,000 shares of common stock in exchange for proceeds under the Put Purchase Agreement. These shares were valued at $3,951,900 upon issuance during the three months ended September 30, 2020. See the capital structure section in Note 1 for disclosure of the equity components included in the Company's consolidated financial statements. | Note 8 Equity In fiscal year 2020 and 2019, 642,857 and 706,618 shares were awarded under the Stock Plan (see Note 13). In fiscal year 2020, the Company issued 525,000 common shares as consideration for convertible notes. In fiscal year 2019, the Company issued 302,271 common shares as consideration for convertible notes. In fiscal year 2020, the Company issued 500,000 shares of Series E Preferred Stock to an investor that converts into 1,190,476 shares of common stock as consideration for a convertible note. There were no preferred shares issued in fiscal year 2019. In fiscal year 2020 and 2019, 0 and 60,000 shares were returned and cancelled upon repayment of a convertible note prior to maturity. During the year ended June 30, 2020 and 2019, the Company issued 7,619,912 and 346,618 common shares for professional consulting services, respectively. The shares were valued at $2,020,150 and $800,751 upon issuance, for the years ended June 30, 2020 and 2019, respectively. In fiscal year 2019, the Company repurchased 38,625 shares from an entity with a common board member under a Share Purchase Agreement related to the sale of Entertainment. These shares are issued but not outstanding at June 30, 2019. During fiscal year 2020, investors exercised warrants in exchange for 32,052,654 common shares in cashless transactions. During fiscal year 2019, an investor exercised warrants in exchange for 381,944 common shares in a cashless transaction. See the capital structure section in Note 1 for disclosure of the equity components included in the Companys consolidated financial statements. |
Income Taxes
Income Taxes | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Income Tax Disclosure [Abstract] | ||
Income Taxes | Note 11 - Income Taxes The Company's effective tax rate differed from the federal statutory income tax rate for the three months ended September 30, 2020 and 2019 as follows: Federal statutory rate 21% State tax, net of federal tax effect 5.31% Valuation allowance -26% Effective tax rate 0% The Company had no federal or state income tax (benefit) for the three months ended September 30, 2020 or 2019. The Company's deferred tax assets and liabilities as of September 30, 2020 and June 30, 2020, are summarized as follows: September 30, 2020 June 30, 2020 Federal Deferred tax assets $ 7,216,100 $ 4,825,100 Less valuation allowance (7,216,100) (4,825,100) Deferred tax liabilities - - - - State Deferred tax assets 1,926,900 1,290,900 Less valuation allowance (1,926,900) (1,290,900) Deferred tax liabilities - - - - Net Deferred Tax Assets $ - $ - The Company's policy is to provide for deferred income taxes based on the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates that will be in effect when the differences are expected to reverse. The Company has not generated taxable income and has not recorded any current income tax expense at September 30, 2020 and 2019, respectively. In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred taxes is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers projected future taxable income and tax planning strategies in making this assessment. The Company's deferred tax assets are primarily comprised of net operating losses ("NOL") that give rise to deferred tax assets. The NOL carryforwards expire over a range from 2020 to 2037, with certain NOL carryforwards that have no expiration. There is no tax benefit for goodwill impairment, which is permanently non-deductible for tax purposes. Additionally, due to the uncertainty of the utilization of NOL carry forwards, a valuation allowance equal to the net deferred tax assets has been recorded. The significant components of deferred tax assets as of September 30, 2020 and June 30, 2020, are as follows: September 30, 2020 June 30, 2020 Net operating loss carryforwards $ 8,681,800 $ 5,767,000 Valuation allowance (9,143,000) (6,116,000) Goodwill 273,600 278,900 Property and equipment (10,200) (10,500) Intangible assets 153,000 35,800 Inventory allowance 17,800 17,800 Warranty accrual and other 27,000 27,000 Net Deferred Tax Assets $ - $ - As of September 30, 2020, the Company does not believe that it has taken any tax positions that would require the recording of any additional tax liability nor does it believe that there are any unrealized tax benefits that would either increase or decrease within the next twelve months. As of September 30, 2020, the Company's income tax returns generally remain open for examination for three years from the date filed with each taxing jurisdiction. | Note 9 - Income Taxes The Companys effective tax rate differed from the federal statutory income tax rate for the years ended June 30, 2020 and 2019 as follows: Federal statutory rate 21% State tax, net of federal tax effect 5.31% Valuation allowance -26% Effective tax rate 0% The Company had no federal or state income tax (benefit) for the years ended June 30, 2020 and 2019. The Companys deferred tax assets and liabilities as of June 30, 2020 and 2019, are summarized as follows: 2020 2019 Federal Deferred tax assets $ 4,825,100 $ 2,980,100 Less valuation allowance (4,825,100) (2,980,100) Deferred tax liabilities - - State Deferred tax assets 1,290,900 866,300 Less valuation allowance (1,290,900) (866,300) Deferred tax liabilities - - - - Net Deferred Tax Assets $ - $ - The Companys policy is to provide for deferred income taxes based on the difference between the financial statement and tax bases of assets and liabilities using enacted tax rates that will be in effect when the differences are expected to reverse. The Company has not generated taxable income and has not recorded any current income tax expense at June 30, 2020 and 2019. In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred taxes is dependent upon the generation of future taxable income during the periods in which those temporary differenced become deductible. Management considers projected future taxable income and tax planning strategies in making this assessment. The Companys deferred tax assets are primarily comprised of net operating losses (NOL) that give rise to deferred tax assets. The NOL carryforwards expire over a range from 2020 to 2037, with certain NOL carryforwards that have no expiration. There is no tax benefit for goodwill impairment, which is permanently non-deductible for tax purposes. Additionally, due to the uncertainty of the utilization of NOL carry forwards, a valuation allowance equal to the net deferred tax assets has been recorded. The significant components of deferred tax assets as of June 30, 2020 and 2019, are as follows: 2020 2019 Net operating loss carryforwards $ 5,767,000 $ 3,826,100 Valuation allowance (6,116,000) (3,846,400) Property and equipment (10,500) (7,100) Goodwill 278,900 - Intangible assets 35,800 - Inventory allowance 17,800) 5,400 Warranty accrual 27,000 22,000 Net Deferred Tax Assets $ - $ - As of June 30, 2020, the Company does not believe that it has taken any tax positions that would require the recording of any additional tax liability nor does it believe that there are any unrealized tax benefits that would either increase or decrease within the next twelve months. As of June 30, 2020, the Companys income tax returns generally remain open for examination for three years from the date filed with each taxing jurisdiction. |
Commitments, Contingencies, and
Commitments, Contingencies, and Concentrations | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Commitments, Contingencies, and Concentrations | Note 12- Commitments, Contingencies, and Concentrations Contingencies Certain conditions may exist as of the date the condensed consolidated financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company's management and its legal counsel assess such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company's legal counsel evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company's condensed consolidated financial statements. If the assessment indicates that a potentially material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material, would be disclosed. On September 4, 2019, the Company recorded a pre-acquisition liability for approximately $591,000 relative to unpaid payroll tax liabilities and associated penalties and fees of Concepts and Solutions. The liability is included with the seller note payable. On August 14, 2020, the Company entered into a legal settlement agreement and recorded a liability for $2,000,000 related to a lawsuit by a previous creditor of Galaxy CO. The liability of $1,058,240 and $2,000,000 is included in the consolidated balance sheets at September 30, 2020 and June 30, 2020. Concentrations Galaxy contracts the manufacturer of its products with overseas suppliers. The Company's sales could be adversely impacted by a supplier's inability to provide Galaxy with an adequate supply of inventory. Galaxy has two customers that accounted for approximately 13% of accounts receivable at September 30, 2020 and three customers that accounted for approximately 79% of accounts receivable at June 30, 2020. Galaxy has two customers that accounted for approximately 48% and 81% of total revenue for the three months ended September 30, 2020 and 2019, respectively. | Note 10 - Commitments, Contingencies, and Concentrations Contingencies Certain conditions may exist as of the date the consolidated financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Companys management and its legal counsel assess such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Companys legal counsel evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Companys consolidated financial statements. If the assessment indicates that a potentially material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material, would be disclosed. On September 4, 2019, the Company recorded a pre-acquisition liability for approximately $591,000 relative to unpaid payroll tax liabilities and associated penalties and fees of Concepts and Solutions (Note 12). The liability is included in the note payable to seller of $1,030,079 at June 30, 2020 (Note 6). On August 14, 2020, the Company entered into a legal settlement agreement and recorded a liability for $2,000,000 related to a lawsuit by a previous creditor of Galaxy CO (Note 1). The $2,000,000 liability is included in the balance sheet at June 30, 2020. Concentrations Galaxy contracts the manufacturer of its products with overseas suppliers. The Companys sales could be adversely impacted by a suppliers inability to provide Galaxy with an adequate supply of inventory. Galaxy has three customers that accounted for approximately 79% of accounts receivable at June 30, 2020 and one customer that accounted for approximately 86% of accounts receivable at June 30, 2019. Galaxy has two customers that accounted for approximately 40% of total revenue for the year ended June 30, 2020 and four customers that accounted for 79% of revenues for the year ended June 30, 2019. |
Material Agreements
Material Agreements | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Disclosure of Material Agreements [Abstract] | ||
Material Agreements | Note 13 - Material Agreements Consulting Agreement Galaxy renewed a consulting agreement in April 2020 for advisory services with a stockholder. In exchange for services provided, the consultant receives consulting fees paid out in stock not resulting in a greater than 4.9% equity interest in Galaxy. On September 18, 2020, the Company issued 97,250,000 shares of common stock registered under the Stock Plan 2020 to the consultant for services. Put Purchase Agreement On May 31, 2020, the Company entered into a two year purchase agreement (the "Put Purchase Agreement") with an investor, which was amended and restated on July 9, 2020. Pursuant to the terms of the Purchase Agreement, the investor agreed to purchase up to $2 million of the Company's common stock (subject to certain limitations) from time to time during the term of the Put Purchase Agreement. The Company issued 2,500,000 shares of common stock to the investor as consideration for its commitment to purchase shares of the Company's common stock. The Company will use proceeds from shares issued to the investor for working capital and general and administrative expenses. Accounts Receivable Factoring Agreement On July 30, 2020, the Company entered into a two year accounts receivable factoring agreement with a financial services company to provide working capital. Factoring fees are 2.5% of the face value of the account receivable sold to the factoring agent per month until collected. For collections over 90 days from the invoice date, the fee increases to 3.5%. The agreement contains a credit line of $1,000,000 and requires a minimum of $300,000 of factored receivables per calendar quarter. The agreement includes early termination fees. The Company factored $191,223 of accounts receivable as of September 30, 2020. Employment Agreements On January 1, 2020, the Company entered into an employment agreement with the Chief Executive Officer (CEO) of the Company for a two-year term which was amended on September 1, 2020. Under the amended employment agreement, the CEO will receive annual compensation of $500,000, and an annual discretionary bonus based on profitability and revenue growth. The agreement includes a non-compete agreement and severance benefits of $90,000. On January 1, 2020, the Company entered into an employment agreement with the Chief Finance Officer/Chief Operations Officer (CFO/COO) of the Company for a two-year term, which was amended on September 1, 2020. Under the amended employment agreement, the CFO/COO will receive annual compensation of $250,000, and an annual discretionary bonus based on profitability and revenue growth. The agreement includes a non-compete agreement and severance benefits of $72,000. Supply Agreement The Company is party to a one year supplier agreement to manufacture and sell audio products to a buyer that is effective until July 2021. The initial order under this supplier agreement is for 4,000 units, at a discounted total price of $3,488,000, to be delivered over the agreement period. If the buyer does not meet the minimum floor of 4,000 units, then the contract becomes void and the buyer must pay the difference between the units sold and the total floor pricing of the $3,488,000. The buyer will pay tooling costs of $25 per unit shipped to them. The Company supplied 92 units as of September 30, 2020. The agreement was extended in July 2020 for a one year term. The agreement can be extended for one additional year. | Note 11 - Material Agreements Manufacturer and Distributorship Agreement On September 15, 2018, the Company signed an agreement with a company in China for the manufacture of Galaxys SLIM series of interactive panels, a new Galaxy product. The manufacturer agreed to manufacture, and the Company agreed to be the sole distributor of the interactive panels in the United States for a term of two years. The agreement includes a commitment by Galaxy to purchase $2 million of product during the first year beginning September 2018. If the minimum purchase is not met, the manufacturer can require the Company to establish a performance improvement plan, and the manufacturer has the right to terminate the agreement. The payment terms are 20% in advance, 30% after the product is ready to ship, and the remaining 50% 45 days after receipt. The manufacturer provides Galaxy with the product, including a three-year manufacturers warranty from the date of shipment. The agreement renews automatically in two-year increments unless three months notice is given by either party. Consulting Agreement Galaxy entered into a 26 month consulting agreement in May 2017 for advisory services. In exchange for services provided, the consultants receive consulting fees of $15,000 per month and a 4.5% equity interest in Galaxy. The 4.5% equity interest was converted to common stock upon the Common Controlled Merger of R&G and Galaxy CO (as described in Note 1). The consulting agreement was renewed in May 2019 with monthly payment terms of $15,000 and 450,000 shares of common stock upon execution of the renewal. The Company paid the consultants $15,000 and $261,000 in fees and expenses for consulting services provided during the years ended June 30, 2020 and 2019, respectively. The Company issued 450,000 shares to the consultants under the Companys Stock Plan during the year ended June 30, 2019. The Company issued 1,097,857 shares to the consultant for consulting services during the year ended June 30, 2020. Consulting Agreement The Company entered into a consulting agreement in May 2018 for advisory services such as maintaining ongoing stock market support such as drafting and delivering press releases and handling investor requests. The program will be predicated on accurate, deliberate and direct disclosure and information flow from the Company and dissemination to the appropriate investor audiences. In exchange for these consulting services provided, the advisor received $15,000 at contract inception, 10,000 shares of common stock and $4,000 monthly through April 2019. The contract renews automatically each year. The Company paid the consultants $16,500 and $222,500 in fees and expenses for consulting services provided during the years ended June 30, 2020 and 2019. Agency Agreement Effective December 11, 2018, the Company entered into a 12 month contract with an agent to raise capital. The agent receives a finders fee ranging from 4% to 8% relative to the amount of capital raised, plus restricted shares in an amount equal to 4% of capital raised, if successful. The Agreement contains an option to extend the contract term for an additional six months. The Company paid $11,600 in fees and issued 212,990 shares of common stock during the year ended June 30, 2020. The Company paid $98,400 in fees and issued 46,618 shares of common stock during the year ended June 30, 2019. Master Service Agreement Effective January 2, 2019, the Company entered into a 3 month contract with a business for advisory services including among other services, presenting and introducing the Company to the financial community of investors. The Company paid $300,000 and issued 300,000 common stock shares under this agreement during the year ended June 30, 2019. The relationship with this advisor is continuing on an as-needed basis. Investor Relations and Advisory Agreement On May 1, 2019, the Company entered into an Investor Relations and Advisory Agreement. The Company pays $8,000 per month under this agreement in cash and a restricted common stock monthly fee in advance of services each month. The number of shares issued is calculated based on the closing price of the Company's common shares on the first day of the month. The Company paid $24,000 and $4,040 in fees during years ended June 30, 2020 and 2019. The Company issued 52,508 common shares under this agreement during fiscal year 2020. Financial Advisory Engagement Effective June 4, 2019, the Company engaged a financial advisor to act as the Companys exclusive financial advisor, lead managing underwriter and sole book running manager and investment banker in connection with a proposed offering. The engagement period of the agreement is June 4, 2019 to May 31, 2020. The Company issued 0 and 250,000 shares to the financial advisor for services in fiscal years 2020 and 2019, respectively. Business Development and Marketing Agreement Effective June 10, 2019, the Company entered into a three-month contract for certain advisory and consulting services. The Company will issue 15,000 shares and pay $20,000 per month under the terms of the agreement. The Company paid $347,300 and $35,000 in fees during the years ended June 30, 2020 and 2019. The Company issued 5,510,000 and 60,000 shares to the consultant for consulting services during the years ended June 30, 2020 and 2019, respectively. Consulting Agreement Effective October 1, 2019, the Company entered into a 1 year agreement for corporate consulting services and financial advisory services. The Company will issue 50,000 shares to the consultant each quarter, up to a total of 200,000 shares for the year. The Company paid $49,800 and $0 in fees during the years ended June 30, 2020 and 2019. The Company issued 150,000 shares to the consultant for consulting services during the year ended June 30, 2020. Purchase Agreement On May 31, 2020, the Company entered into a 2 year Purchase Agreement with an investor, which was amended and restated on July 9, 2020. Pursuant to the terms of the Purchase Agreement, the investor agreed to purchase up to $2 million of the Companys common stock (subject to certain limitations) from time to time during the term of the Agreement. The Company issued 2,500,000 shares to the investor as consideration for its commitment to purchase shares of the Companys common stock. The Company will use proceeds from shares issued to the investor for working capital and general and administrative expenses. Employment Agreements On January 1, 2020, the Company entered into an employment agreement with the Chief Executive Officer (CEO) of the Company for a two-year term which was amended on September 1, 2020. Under the amended employment agreement, the CEO will receive annual compensation of $500,000, and an annual discretionary bonus based on profitability and revenue growth. The agreement includes a non-compete agreement and severance benefits of $90,000. On January 1, 2020, the Company entered into an employment agreement with the Chief Finance Officer/Chief Operations Officer (CFO/COO) of the Company for a two-year term, which was amended on September 1, 2020. Under the amended employment agreement, the CFO/COO will receive annual compensation of $250,000, an annual discretionary bonus based on profitability and revenue growth. The agreement includes a non-compete agreement and severance benefits of $72,000. |
Acquisitions
Acquisitions | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Business Combinations [Abstract] | ||
Acquisitions | Note 14 - Acquisition On September 4, 2019, Galaxy entered into a stock purchase agreement with Concepts and Solutions. Under the terms of the stock purchase agreement, 100% of the outstanding capital for both Concepts and Solutions was purchased by Galaxy. Concurrent with this acquisition, the Company applied pushdown accounting; therefore, the consolidated financial statements after completion of the acquisition include the assets, liabilities, and results of operations of the combined company from and after the closing date. As part of the stock purchase agreement, Galaxy issued 1,350,000 shares of common stock to the seller with a value of $1,485,000. In addition to the issuance of shares of common stock, the Company entered into three promissory notes with the seller for a total note payable of $3,000,000. Payments under the notes are subject to adjustment based on the achievement of minimum gross revenues and successful resolution of certain pre-acquisition payroll withholding tax issues of Concepts and Solutions. The Company believes future earnings goals will not be met and valued the note payable at $1,484,473. The balance of the note payable is $1,030,079 at September 30, 2020 and June 30, 2020. Management of the Company determined that a triggering event to assess the impairment of goodwill associated with the acquisition of Concepts and Solutions occurred during the year ended June 30, 2020. While there was no single event, the consideration in totality of several factors that developed during this year led management to conclude that it was more likely than not that the fair values of certain intangible assets and goodwill acquired as part of the acquisition were below their carrying amounts. See Note 4. The following table summarizes the preliminary allocation of the fair value of the assets and liabilities as of the acquisition date through pushdown accounting. The preliminary allocation to certain assets and/or liabilities may be adjusted by material amounts as the Company finalizes fair value estimates. Assets Cash $ 201,161 Accounts receivable 1,165,953 Inventory 94,360 Property and equipment 20,904 Other assets 2,800 Goodwill and other intangibles 3,760,287 Total Assets 5,245,465 Liabilities Accounts payable 1,225,734 Accrued expenses 783,540 Short-term debt 96,941 Deferred revenue 518,900 Total Liabilities 2,625,115 Net Assets $ 2,620,350 Consideration Fair value of anti-dilution clause in employment agreement $ 235,350 Note payable to seller 900,000 Stock 1,485,000 $ 2,620,350 | Note 12 - Acquisitions Reverse Acquisition On June 22, 2018, Galaxy consummated a reverse triangular merger whereby Galaxy merged with and into FLCRs newly formed subsidiary, Galaxy MS, Inc. which was formed specifically for the transaction. Under the terms of the merger, Galaxys shareholders transferred all their outstanding shares of common stock to Galaxy MS, in return for FLCRs Series C Preferred Shares, which were equivalent to approximately 3,065,000,000 shares of the common stock of FLCR on a pre-reverse stock split basis. This represented approximately 89% of the outstanding common stock of FLCR, with the remaining 11% of common stock distributed as follows: (a) an ownership interest of seven percent (7%) to the holders of common stock, pro rata; and (b) four percent (4%) of the common stock to the holders of convertible debt, pro rata. Concurrent with the reverse triangular merger, the Company applied pushdown accounting; therefore, the consolidated financial statements after completion of the reverse merger include the assets, liabilities, and results of operations of the combined company from and after the closing date of the reverse merger, with only certain aspects of pre-consummation stockholders equity remaining in the consolidated financial statements. There was no cash consideration paid by Galaxy to FLCR on the date of the reverse triangular merger. Instead, shares of stock were issued and exchanged, and the Company acquired $1,511,844 of net assets of FLCR. At the closing of the merger, all of FLCRs convertible promissory notes were converted into FLCRs common shares. The merger agreement contains potential future tax advantages of the net operating loss carryforward available to offset future taxable income of the combined company, up to a maximum of $150,000, over a 5-year period beginning June 22, 2018. There is a valuation allowance reducing this tax benefit to zero at June 30, 2020 and 2019. The following table summarizes the preliminary allocation of the fair value of the assets and liabilities as of the merger date through pushdown accounting. The preliminary allocation to certain assets and/or liabilities may be adjusted by material amounts as the Company finalizes fair value estimates. Assets Cash $ 22,205 Property and equipment 4,209,995 Other 20,716 Other assets 1,511,844 Goodwill 892,312 Total Assets 6,657,072 Liabilities Accounts payable 208,763 Long-term debt 4,593,851 Short-term debt 799,534 Accrued interest 78,948 Other 83,664 Total Liabilities 5,764,760 Net Assets $ 892,312 Consideration $ 58,092 Fair value of noncontrolling interest 834,220 $ 892,312 As a result of the Company pushing down the effects of the acquisition, certain accounting adjustments are reflected in the consolidated financial statements, such as goodwill recognized of $834,220 and reflected in the balance sheet. Goodwill recognized is primarily attributable to the acquisition of the fair value of the public company structure and other intangible assets that do not qualify for separate recognition. Other assets noted in the table above consist of the differences between the acquired assets and liabilities of Full Circle Entertainment distributed to pre-acquisition FLCR shareholders. The Company sold the Entertainment subsidiary on February 6, 2019 to focus on its primary business plan. As a result, the Company did not receive any economic benefit from the related other assets in the table above, nor incur any obligations from the corresponding liabilities. The consideration received for the sale of Entertainment was 38,625 shares of Galaxy common stock at the fair value on the date of the transaction, or $92,700. The fair value of the Galaxy common shares received offset the assets and liabilities of Entertainment, with the difference recorded as a gain on the sale for the year ended June 30, 2019. The gain on the sale has been recorded in other income in the Consolidated Statement of Operations. The following table presents a summary of Entertainments identifiable assets and liabilities at February 6, 2019, the date of the sale: Assets Cash $ 36,290 Property and equipment, net 4,006,426 Receivables 4,500 Inventories 5,610 Other assets 1,522,714 Total Assets 5,575,540 Liabilities Accounts payable 22,424 Debt 5,393,623 Accrued expenses 127,481 Total Liabilities 5,543,528 Net Assets $ 32,012 Noncash consideration for net assets of Entertainment 92,700 Gain on Sale $ 60,688 Concepts and Solutions Acquisition On September 4, 2019, Galaxy entered into a stock purchase agreement with Concepts and Solutions. Under the terms of the stock purchase agreement, 100% of the outstanding capital for both Concepts and Solutions was purchased by Galaxy. Concurrent with this acquisition, the Company applied pushdown accounting; therefore, the consolidated financial statements after completion of the acquisition include the assets, liabilities, and results of operations of the combined company from and after the closing date. As part of the stock purchase agreement, Galaxy issued 1,350,000 common shares to the seller with a value of $1,485,000. In addition to the issuance of common shares, the Company entered into three promissory notes with the seller for a total note payable of $3,000,000. Payments under the notes are subject to adjustment based on the achievement of minimum gross revenues and successful resolution of certain pre-acquisition payroll withholding tax issues of Concepts and Solutions. The Company believes future earnings goals will not be met and valued the note payable at $1,484,473, which includes approximately $584,000 of accrued pre-acquisition withholding tax liabilities (See Note 10). The balance of the note payable is $1,030,079 at June 30, 2020. Management of the Company determined that a triggering event to assess the impairment of goodwill associated with the acquisition of Concepts and Solutions occurred during the third quarter of 2020. While there was no single event, the consideration in totality of several factors that developed during this quarter led management to conclude that it was more likely than not that the fair values of certain intangible assets and goodwill acquired as part of the acquisition were below their carrying amounts. See Notes 1 and 12. The following table summarizes the preliminary allocation of the fair value of the assets and liabilities as of the acquisition date through pushdown accounting. The preliminary allocation to certain assets and/or liabilities may be adjusted by material amounts as the Company finalizes fair value estimates. Assets Cash $ 201,161 Accounts receivable 1,165,953 Inventory 94,360 Property and equipment 20,904 Other assets 2,800 Goodwill and other intangibles 3,760,287 Total Assets 5,245,465 Liabilities Accounts payable 1,225,734 Accrued expenses 783,540 Short-term debt 96,941 Deferred revenue 518,900 Total Liabilities 2,625,115 Net Assets $ 2,620,350 Consideration Fair value of anti-dilution clause in employment agreement $ 235,350 Note payable to seller 900,000 Stock 1,485,000 $ 2,620,350 As a result of the Company pushing down the effects of the acquisition, certain accounting adjustments are reflected in the consolidated financial statements, such as goodwill and other intangible assets initially recognized of $3,760,287 and reflected in the balance sheet as of September 30, 2019. Goodwill and other intangible assets recognized is primarily attributable to the amount of the consideration in excess of the fair value of Concepts and Solutions at the date of purchase. |
Stock Plan
Stock Plan | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | ||
Stock Plan | Note 15 - Stock Plan An Employee, Directors, and Consultants Stock Plan was established by the Company (The "Plan"). The Plan is intended to attract and retain employees, directors and consultants by aligning the economic interest of such individuals more closely with the Company's stockholders by paying fees or salaries in the form of shares of the Company's common stock. The Plan is renewed annually or earlier. The 2020 Plan is effective September 16, 2020 and expires December 15, 2021. The 2019 Plan is effective December 13, 2018 and expires June 1, 2020. Shares of common stock of 99,250,000 are reserved for stock awards under the Plans. There were 98,857,857 and 965,000 shares awarded under the Plans as of September 30, 2020 and June 30, 2020, respectively. | Note 13 Stock Plan An Employee, Directors, and Consultants Stock Plan was established by the Company. The Plan is intended to attract and retain employees, directors and consultants by aligning the economic interest of such individuals more closely with the Companys stockholders, by paying fees or salaries in the form of shares of the Companys common stock. The Plan is reviewed annually. The 2020 Plan is effective September 16, 2020 and expires December 15, 2021. The 2019 Plan is effective December 13, 2018 and expires June 1, 2020. Common shares of 2,000,000 are reserved for stock awards under the Plans. There were 965,000 and 642,857 shares awarded under the Plans as of June 30, 2020 and 2019, respectively. |
Going Concern
Going Concern | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Disclosure of Going Concern [Abstract] | ||
Going Concern | Note 16- Going Concern The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As reflected in the accompanying consolidated financial statements, the Company had negative working capital of approximately $5,000,000, an accumulated deficit of approximately $37,000,000, and cash used in operations of approximately $3,000,000 at September 30, 2020. The Company's operational activities has primarily been funded through issuance of common stock for services, related party advances, put purchase agreement transactions for proceeds, accounts receivable factoring, debt financing, a private placement offering of common stock and through the deferral of accounts payable and other expenses. The Company intends to raise additional capital through the sale of equity securities or borrowings from financial institutions and investors and possibly from related and nonrelated parties who may in fact lend to the Company on reasonable terms. Management believes that its actions to secure additional funding will allow the Company to continue as a going concern. There is no guarantee the Company will be successful in achieving any of these objectives. These sources of working capital are not assured, and consequently do not sufficiently mitigate the risks and uncertainties disclosed above. The ability of the Company to continue as a going concern is dependent upon management's ability to raise capital from the sale of its equity and, ultimately, the achievement of operating revenues. The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. | Note 14 - Going Concern The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As reflected in the accompanying consolidated financial statements, the Company had negative working capital of approximately $7,000,000, an accumulated deficit of approximately $23,500,000, and cash used in operations of approximately $7,400,000 at June 30, 2020. The Companys operational activities has primarily been funded through issuance of common stock for services, related party advances, debt financing, a private placement offering of common stock and through the deferral of accounts payable and other expenses. The Company intends to raise additional capital through the sale of equity securities or borrowings from financial institutions and possibly from related and nonrelated parties who may in fact lend to the Company on reasonable terms. Management believes that its actions to secure additional funding will allow the Company to continue as a going concern. There is no guarantee the Company will be successful in achieving any of these objectives. These sources of working capital are not assured, and consequently do not sufficiently mitigate the risks and uncertainties disclosed above. The ability of the Company to continue as a going concern is dependent upon managements ability to raise capital from the sale of its equity and, ultimately, the achievement of operating revenues. The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. |
Subsequent Events
Subsequent Events | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Subsequent Events [Abstract] | ||
Subsequent Events | Note 17- Subsequent Events The Company has evaluated subsequent events through the date on which the condensed consolidated financial statements were available to be issued. On October 15, 2020, the Company entered into an Asset Purchase Agreement (APA), to acquire the assets of Classroom Technologies Solutions, Inc. ("Classroom Tech"), for consideration of (a) paying off a secured Classroom Tech loan, not to exceed the greater of 50% of the value of the Classroom Tech assets acquired or $120,000; (b) the issuance a promissory note in the amount of $44,526 to a Classroom Tech designee; and (c) the issuance of 10 million shares of common stock to the seller of Classroom Tech. On October 22, 2020, the Company reserved 50,000,000 shares in certificate form as collateral on the renewed line of credit (Note 5). In October 2020, the Company issued 7,025,582 shares to investors in satisfaction of $58,300 of principal on convertible notes. On October 30, 2020, the Company issued a $1,200,000 convertible note to an investor.The common shares reserved for conversion under the note are registered. | Note 15 - Subsequent Events The Company has evaluated subsequent events through the date on which the consolidated financial statements were available to be issued. On July 1, 2020, the Company signed a lease agreement for a warehouse in Jacksonville, Florida. The lease expires in June 30, 2021 and requires monthly installments of $3,524. Future lease payments are approximately $43,000 per year for the year ended June 30, 2021. On August 1, 2020, the Company signed a lease agreement for a warehouse in Peoria, Arizona. The lease expires in July 31, 2022 and requires monthly installments ranging from $1,463 to $3,012. Future escalating lease payments are approximately $29,000 and $39,000 for the years ended June 30, 2021 and 2022. In July and August 2020, the Company issued a total of 242,000,000 shares to an investor in exchange for proceeds of $1,884,520 under the Purchase Agreement dated May 19, 2020 (Note 11). In July 2020, the Company issued 784,966,812 common shares to investors in satisfaction of $977,350 of principal on convertible notes. In July and August 2020, a warrant holder exercised warrants and received 204,771,864 shares in five cashless transactions. In July and August 2020, the Company entered into new $125,000 and $500,000 convertible notes with an investor. On July 30, 2020, the Company entered into a two year accounts receivable factoring agreement with a financial services company to provide working capital. Factoring fees are 2.5% of the face value of the account receivable sold to the factoring agent per month until collected. For collections over 90 days from the invoice date, the fee increases to 3.5%. The agreement contains a credit line of $1,000,000 and requires a minimum of $300,000 of factored receivables per calendar quarter. The agreement includes early termination fees. The Company has factored approximately $390,000 of accounts receivable as of September 25, 2020. In August 2020, the Company issued 327,513,771 common shares to investors in satisfaction of $804,160 of principal on convertible notes. As of September 25, 2020, the Company paid approximately $732,000 under the Settlement Agreement dated August 14, 2020 (Note 10). Galaxy renewed a consulting agreement in April 2020 for advisory services with a stockholder. In exchange for services provided, the consultant receives consulting fees paid out in stock not resulting in a greater than 4.9% equity interest in Galaxy. Effective September 16, 2020, the company adopted the Employee, Directors and Consultants Stock Plan 2020 and reserved 97,250,000 shares of common stock for distribution under the Plan. On September 18, 2020, the Company issued 97,250,000 shares registered under the Stock Plan 2020 to a consultant for services. The Plan expires on December 15, 2021. In September 2020, the Company issued 6,500,000 shares for consulting services. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Accounting Policies [Abstract] | ||
Impact of Coronavirus Aid, Relief, and Economic Security Act | Impact of Coronavirus Aid, Relief, and Economic Security Act The Coronavirus Aid, Relief and Economic Security Act (the "CARES Act") was enacted in March 2020 in response to the COVID-19 pandemic. The CARES Act and related rules and guidelines include several significant provisions, including delaying certain payroll tax payments, mandatory transition tax payments, and estimated income tax payments that we are deferring to future periods. As a result, the Company delayed payment of certain payroll tax payments in the amount of $19,517 as of September 30, 2020 and June 30, 2020, respectively. In April 2020, the Company applied for an unsecured loan (The "PPP Loan") under the Paycheck Protection Program (PPP). The PPP was established under The CARES Act and is administered by the U.S. Small Business Administration (SBA). The PPP loan was approved and funded, and the Company entered into an unsecured loan of approximately $311,000. The PPP loan matures in April 2022 and accrues interest at an annual rate of 0.98%. The promissory note evidencing the PPP Loan contains customary events of default relating to, among other things, payment defaults and provisions of the promissory note. In accordance with the requirements of the CARES Act, the Company used the proceeds from the PPP Loan primarily for payroll costs. See Note 6. In May 2020, the Company received a loan from the SBA under Section 7(b) of the Small Business Act. The $150,000 secured loan matures in May 2050 and accrues interest at an annual rate of 3.75%. The promissory note is collateralized by a security interest in substantially all assets of the Company. The loan proceeds are to fund working capital needs due to economic injury caused by the COVID-19 pandemic. See Note 6. | Impact of Coronavirus Aid, Relief, and Economic Security Act The Coronavirus Aid, Relief and Economic Security Act (the CARES Act) was enacted in March 2020, in response to the COVID-19 pandemic. The CARES Act and related rules and guidelines include several significant provisions, including delaying certain payroll tax payments, mandatory transition tax payments, and estimated income tax payments that we are deferring to future periods. As a result, the Company delayed payment of certain payroll tax payments in the amount of $19,517 as of June 30, 2020. In April 2020, the Company applied for an unsecured loan under the Paycheck Protection Program, or the PPP Loan. The Paycheck Protection Program, or PPP, was established under CARES Act and is administered by the U.S. Small Business Administration (SBA). The PPP loan was approved and funded, and the Company entered into an unsecured loan of approximately $311,000. The loan matures in April 2022 and accrues interest at an annual rate of 0.98%. The promissory note evidencing the PPP Loan contains customary events of default relating to, among other things, payment defaults and provisions of the promissory note. In accordance with the requirements of the CARES Act, the Company used the proceeds from the PPP Loan primarily for payroll costs. See Note 4. In May 2020, the Company received a loan from the U.S. Small Business Administration under Section 7(b) of the Small Business Act. The $150,000 secured loan matures in May 2050 and accrues interest at an annual rate of 3.75%. The promissory note is collateralized by a security interest in substantially all assets of the Company. The loan proceeds are to fund working capital needs due to economic injury caused by the COVID-19 pandemic. See Note 4. |
Corporate History, Nature of Business, Mergers and Acquisitions | Corporate History, Nature of Business, Mergers and Acquisitions Galaxy Next Generation LTD CO. ("Galaxy CO") merged with R&G Sales, Inc. ("R&G") ("common controlled merger") with R&G becoming the surviving company. R&G subsequently changed its name to Galaxy Next Generation, Inc. On September 4, 2019, Galaxy acquired 100% of the stock of Interlock Concepts, Inc. ("Concepts") and Ehlert Solutions Group, Inc. ("Solutions"). The purchase price for the acquisition was 1,350,000 shares of common stock and a two year note payable to the seller for $3,000,000. The note payable to the seller is subject to adjustment based on the achievement of certain future gross revenues and successful completion of certain pre-acquisition withholding tax issues of Concepts and Solutions. Solutions and Concepts are Utah-based audio design and manufacturing companies creating innovative products that provide fundamental tools for building notification systems primarily to K-12 education market customers located primarily in the north and northwest United States. These products and services allow institutions access to intercom, scheduling, and notification systems with improved ease of use. The products provide an open architecture solution to customers which allows the products to be used in both existing and new environments. Intercom, public announcement (PA), bell and control solutions are easily added and integrated within the open architecture design and software model. These products combine elements over a common internet protocol (IP) network, which minimizes infrastructure requirements and reduces costs by combining systems. Galaxy is a manufacturer and U.S. distributor of interactive learning technology hardware and software that allows the presenter and participant to engage in a fully collaborative instructional environment. Galaxy's products include Galaxy's own private-label interactive touch screen panel as well as numerous other national and international branded peripheral and communication devices. New technologies like Galaxy's own touchscreen panels are sold along with renowned brands such as Google Chromebooks, Microsoft Surface Tablets, Lenovo & Acer computers, Verizon WiFi and more. Galaxy's distribution channel consists of approximately 30 resellers across the U.S. who primarily sell its products within the commercial and educational market. Galaxy does not control where the resellers focus their resell efforts; however, the K-12 education market is the largest customer base for Galaxy products comprising nearly 90% of Galaxy's sales. In addition, Galaxy also possesses its own reseller channel where it sells directly to the K-12 market, primarily throughout the Southeast region of the United States. | Corporate History, Nature of Business, Mergers and Acquisitions Galaxy Next Generation LTD CO. (Galaxy CO) was organized in the state of Georgia in February 2017 while R & G Sales, Inc. (R&G) was organized in the state of Georgia in August 2004. Galaxy CO merged with R&G (common controlled merger) on March 16, 2018, with R&G becoming the surviving company. R&G subsequently changed its name to Galaxy Next Generation, Inc. (Galaxy). FullCircle Registry, Inc., (FLCR) is a holding company created for the purpose of acquiring small profitable businesses to provide exit plans for those companys owners. FLCRs subsidiary, FullCircle Entertainment, Inc. (Entertainment or FLCE), owns and operates Georgetown 14 Cinemas, a fourteen-theater movie complex located in Indianapolis, Indiana. On June 22, 2018, Galaxy consummated a reverse triangular merger whereby Galaxy merged with and into Full Circle Registry, Inc.s (FLCR) as a newly formed subsidiary which was formed specifically for the transaction (Galaxy MS). The merger resulted in Galaxy MS becoming a wholly-owned subsidiary of FLCR. For accounting purposes, the acquisition of Galaxy by FLCR is considered a reverse acquisition, an acquisition transaction where the acquired company, Galaxy, is considered the acquirer for accounting purposes, notwithstanding the form of the transaction. The primary reason the transaction is being treated as a purchase by Galaxy rather than a purchase by FLCR is that FLCR is a public reporting company, and Galaxys stockholders gained majority control of the outstanding voting power of FLCRs equity securities. Consequently, the assets and liabilities and the operations that are reflected in the historical financial statements of the Company prior to the merger are those of Galaxy. The financial statements after the completion of the merger include the combined assets and liabilities of the combined company (collectively Galaxy Next Generation, Inc., Full Circle Registry, Inc. and FullCircle Entertainment, Inc., or the Company). In recognition of Galaxys merger with FLCR, several things occurred: (1) FLCR amended its articles of incorporation to change its name from FullCircle Registry, Inc. to Galaxy Next Generation, Inc.; (2) Galaxy and FLCR changed its fiscal year end to June 30, effective June 2018; (3) FLCR authorized shares of preferred stock were increased to 200,000,000 and authorized shares of common stock were increased to 4,000,000,000, (prior to the Reverse Stock Split) both with a par value of $0.0001; and (4) the Board of Directors and Executive Officers approved Gary LeCroy, President and Director; Magen McGahee, Secretary and Director; and Carl Austin, Director; and (5) the primary business operated by the combined company became the business that was operated by Galaxy. On September 4, 2019, Galaxy acquired 100% of the stock of Interlock Concepts, Inc. (Concepts) and Ehlert Solutions Group, Inc. (Solutions). The purchase price for the acquisition was 1,350,000 shares of common stock and a two year note payable to the seller for $3,000,000. The note payable to the seller is subject to adjustment based on the achievement of certain future gross revenues and successful completion of certain pre-acquisition withholding tax issues of Concepts and Solutions. Solutions and Concepts are Utah-based audio design and manufacturing companies creating innovative products that provide fundamental tools for building notification systems primarily to K-12 education market customers located primarily in the north and northwest United States. Solutions and Concepts' products and services allow institutions access to intercom, scheduling, and notification systems with improved ease of use. The products provide an open architecture solution to customers which allows the products to be used in both existing and new environments. Intercom, public announcement (PA), bell and control solutions are easily added and integrated within the open architecture design and software model. These products combine elements over a common internet protocol (IP) network, which minimizes infrastructure requirements and reduces costs by combining systems. Galaxy is a manufacturer and U.S. distributor of interactive learning technology hardware and software that allows the presenter and participant to engage in a fully collaborative instructional environment. Galaxys products include Galaxys own private-label interactive touch screen panel as well as numerous other national and international branded peripheral and communication devices. New technologies like Galaxys own touchscreen panels are sold along with renowned brands such as Google Chromebooks, Microsoft Surface Tablets, Lenovo & Acer computers, Verizon WiFi and more. Galaxys distribution channel consists of approximately 30 resellers across the U.S. who primarily sell its products within the commercial and educational market. Galaxy does not control where the resellers focus their resell efforts; however, the K-12 education market is the largest customer base for Galaxy products comprising nearly 90% of Galaxys sales. In addition, Galaxy also possesses its own reseller channel where it sells directly to the K-12 market, primarily throughout the Southeast region of the United States. As disclosed in Note 12, the Entertainment segment was sold on February 6, 2019 in exchange for 38,625 Galaxy common shares. |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America. Any reference in these footnotes to applicable guidance is meant to refer to the authoritative U.S. generally accepted accounting principles ("GAAP") as found in the Accounting Standards Codification ("ASC") and Accounting Standards Update ("ASU") of the Financial Accounting Standards Board ("FASB"). The financial statements include the consolidated assets and liabilities of the combined company (collectively Galaxy Next Generation, Inc., Interlock Concepts, Inc., and Ehlert Solutions Group, Inc. referred to collectively as the "Company"). See Note 14. All intercompany transactions and accounts have been eliminated in the consolidation. The Company is an over-the-counter public company traded under the stock symbol listing GAXY (formerly FLCR). | Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America. Any reference in these footnotes to applicable guidance is meant to refer to the authoritative U.S. generally accepted accounting principles (GAAP) as found in the Accounting Standards Codification (ASC) and Accounting Standards Update (ASU) of the Financial Accounting Standards Board (FASB). The financial statements include the consolidated assets and liabilities of the combined company (collectively Galaxy Next Generation, Inc., FullCircle Registry, Inc., FullCircle Entertainment, Inc., Interlock Concepts, Inc., and Ehlert Solutions Group, Inc. referred to collectively as the Company). See Note 12. All intercompany transactions and accounts have been eliminated in the consolidation. The Company is an over-the-counter public company traded under the stock symbol listing GAXY (formerly FLCR). |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in accordance with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates used in preparing the consolidated financial statements include those assumed in computing product warranty liabilities, product development costs, valuation of goodwill and intangible assets, valuation of convertible notes payable and warrants, and the valuation of deferred tax assets. It is reasonably possible that the significant estimates used will change within the next year. | Use of Estimates The preparation of consolidated financial statements in accordance with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates used in preparing the consolidated financial statements include those assumed in computing product warranty liabilities, product development costs, valuation of goodwill and intangible assets, valuation of convertible notes payable and warrants, and the valuation of deferred tax assets. It is reasonably possible that the significant estimates used will change within the next year. |
Capital Structure | Capital Structure In accordance with ASC 505, Equity, the Company's capital structure is as follows: September 30, 2020 Authorized Issued Outstanding Common stock 4,000,000,000 2,194,557,083 2,194,518,458 $.0001 par value, one vote per share Preferred stock 200,000,000 - - $.0001 par value, one vote per share Preferred stock - Class A 750,000 - - $.0001 par value; no voting rights Preferred stock - Class B 1,000,000 - - Voting rights of 10 votes for 1 Preferred B share; 2% preferred dividend payable annually Preferred stock - Class C 9,000,000 - - $.0001 par value; 500 votes per share, convertible to common stock Preferred stock - Class D 1,000,000 - - $.0001 par value; no voting rights, convertible to common stock, mandatory conversion to common stock 18 months after issue Preferred stock - Class E 500,000 500,000 500,000 $.0001 par value; no voting rights, convertible to common stock June 30, 2020 Authorized Issued Outstanding Common stock 4,000,000,000 628,039,242 628,000,617 $.0001 par value, one vote per share Preferred stock 200,000,000 - - $.0001 par value, one vote per share Preferred stock - Class A 750,000 - - $.0001 par value; no voting rights Preferred stock - Class B 1,000,000 - - Voting rights of 10 votes for 1 Preferred B share; 2% preferred dividend payable annually Preferred stock - Class C 9,000,000 - - $.0001 par value; 500 votes per share, convertible to common stock Preferred stock - Class D 1,000,000 - - $.0001 par value; no voting rights, convertible to common stock, mandatory conversion to common stock 18 months after issue Preferred stock - Class E 500,000 500,000 500,000 $.0001 par value; no voting rights, convertible to common stock There is no publicly traded market for the preferred shares. There are 1,101,609,009 common shares reserved at September 30, 2020 under terms of the convertible debt agreements, Stock Plan and Put Purchase Agreement (see Notes 6, 14 and 15). There are 125,953,028 issued common shares that are restricted as of September 30, 2020. The shares may become free-trading upon satisfaction of certain terms and regulatory conditions. | Capital Structure The Companys capital structure is as follows: June 30, 2020 Authorized Issued Outstanding Common stock 4,000,000,000 628,039,242 628,000,617 $.0001 par value, one vote per share Preferred stock 200,000,000 - - $.0001 par value, one vote per share Preferred stock - Class A 750,000 - - $.0001 par value; no voting rights Preferred stock - Class B 1,000,000 - - Voting rights of 10 votes for 1 Preferred B share; 2% preferred dividend payable annually Preferred stock - Class C 9,000,000 - - $.0001 par value; 500 votes per share, convertible to common stock Preferred stock - Class D 1,000,000 - - $.0001 par value; no voting rights, convertible to common stock, mandatory conversion to common stock 18 months after issue Preferred stock - Class E 500,000 500,000 500,000 $.0001 par value; no voting rights, convertible to common stock June 30, 2019 Authorized Issued Outstanding Common stock 4,000,000,000 11,318,901 11,280,276 $.0001 par value, one vote per share Preferred stock 200,000,000 - - $.0001 par value, one vote per share Preferred stock - Class A 750,000 - - $.0001 par value; no voting rights Preferred stock - Class B 1,000,000 - - Voting rights of 10 votes for 1 Preferred B share; 2% preferred dividend payable annually Preferred stock - Class C 9,000,000 - - $.0001 par value; 500 votes per share, convertible to common stock There is no publicly traded market for the preferred shares. There are 16,305,023 issued common shares that are restricted as of June 30, 2020. The shares will become free- trading upon satisfaction of certain terms within the convertible debt agreements. |
Business Combinations | Business Combinations The Company accounts for business combinations under the acquisition method of accounting. Under this method, acquired assets, including separately identifiable intangible assets, and any assumed liabilities are recorded at their acquisition date estimated fair value. The excess of purchase price over the fair value amounts assigned to the assets acquired and liabilities assumed represents the goodwill amount resulting from the acquisition. Determining the fair value of assets acquired and liabilities assumed involves the use of significant estimates and assumptions. | Business Combinations The Company accounts for business combinations under the acquisition method of accounting. Under this method, acquired assets, including separately identifiable intangible assets, and any assumed liabilities are recorded at their acquisition date estimated fair value. The excess of purchase price over the fair value amounts assigned to the assets acquired and liabilities assumed represents the goodwill amount resulting from the acquisition. Determining the fair value of assets acquired and liabilities assumed involves the use of significant estimates and assumptions. |
Revenue Recognition | Revenue Recognition In accordance with ASC 606, revenue is recognized when a customer obtains control of promised services. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for these services. To achieve this core principle, the Company applies the following five steps: ● Identify the contract with a customer ● Identify the performance obligations in the contract ● Determine the transaction price ● Allocate the transaction price to performance obligations in the contract ● Recognize revenue when or as the Company satisfies a performance obligation All of the Company's performance obligations and associated revenue are generally transferred to customers at a point in time. Shipping and handling costs billed to customers are included in revenue in the accompanying statements of operations. Costs incurred by the Company associated with shipping and handling are included in cost of sales in the accompanying statements of operations. Sales are recorded net of sales returns and discounts, and sales are presented net of sales-related taxes. Contracts with Multiple Performance Obligations Most contracts with customers contain multiple performance obligations. For these contracts, the Company accounts for individual performance obligations separately if they are distinct. The transaction price is allocated to the separate performance obligations on a relative standalone selling price basis. The Company's products can be sold on a stand-alone basis to customers which provides objective evidence of the fair value of the product portion of the multi-element contract, and thus represents the Company's best estimate of selling price. The Company considers several factors in determining that control transfers to the customer including that legal title transfers to the customer, the Company has a present right to payment, and the customer has assumed the risks and rewards of ownership. Product Product revenue consists of fees for associated equipment sold, such as interactive panels, intercom, public announcement, bell and control solutions. Product sales resulting from fixed-price contracts involve a signed contract for a fixed price or a binding purchase order to provide the Company's interactive panels and accessories. Revenue is recognized at a point in time once the product is installed at the customer's premises. Hardware items are generally invoiced in full on execution of the arrangement. Service Service revenue consists of installation and training services, support maintenance, technical assistance, bug fixes, and product repair. The Company satisfies its service performance obligations by providing "stand-ready" assistance as required over the contract period. The fair value of these services is separately calculated using expected costs of the services. Many times, the value of the services is calculated using price quotations from subcontractors to the Company who perform such services on a stand-alone basis. Additionally, service revenue not part of the contract is based upon standard hourly/daily rates, and revenue is recognized as the services are performed. Software The Company sells equipment with embedded software to its customers. The embedded software is not sold separately and is not a significant focus of the Company's marketing efforts. The Company does not provide post-contract customer support specific to the software or incur significant costs that are within the scope of FASB guidance on accounting for software to be leased or sold. Additionally, the functionality that the software provides is marketed as part of the overall product. The software embedded in the equipment is incidental to the equipment as a whole. Reserves and Warranties The Company does not record a reserve for product returns as contract arrangements generally exclude a right of return for delivered items. Because of the nature and quality of the Company's products, the Company provides for the estimated costs of warranties at the time revenue is recognized for a period of five years after purchase as a secondary warranty. The manufacturer also provides a warranty against certain manufacturing and other defects. As of September 30, 2020 and June 30, 2020, the Company accrued $102,350, respectively, for estimated product warranty claims, which is included in accrued expenses in the accompanying condensed consolidated balance sheets. The accrued warranty costs are based primarily on historical warranty claims as well as current repair costs. There was $1,391 and $82,494 of warranty expense for the three months ended September 30, 2020 and 2019, respectively. The Company negotiated a warranty settlement with one of its manufacturers. At September 30, 2020 and June 30, 2020, the Company accrued $87,720 and $124,437 payable to this manufacturer. Costs to Obtain and Fulfill a Contract The Company incurs incremental costs to obtain a contract in the form of sales commissions. These costs, whether related to performance obligations that extend beyond twelve months or not, are immaterial and will continue to be recognized in the period incurred within general and administrative expenses. Contract Assets and Contract Liabilities Contract assets are rights to consideration in exchange for goods or services that has been transferred to a customer when that right is conditional on something other than the passage of time. The majority of our contract assets represent unbilled accounts receivable as the right to consideration is subject to the contractually agreed upon installation and billing schedule. Contract liabilities (deferred revenue) represent consideration received or consideration which is unconditionally due from customers prior to transferring goods or services to the customer under the terms of the contract, all of which is expected to be recognized within one year. | Revenue Recognition Technology Interactive Panels and Related Products The Company derives revenue from the sale of interactive panels and other related products. Sales of these panels may also include optional equipment, accessories and services (installation, training and other services, maintenance and warranty services). Product sales and installation revenue are recognized when all of the following criteria have been met: (1) products have been shipped or customers have purchased and accepted title to the goods; service revenue for installation of products sold is recognized as the installation services are performed, (2) persuasive evidence of an arrangement exists, (3) the price to the customer is fixed, and (4) collectability is reasonably assured. Deferred revenue consists of customer deposits and advance billings of the Companys products where sales have not yet been recognized. Shipping and handling costs billed to customers are included in revenue in the accompanying statements of operations. Costs incurred by the Company associated with shipping and handling are included in cost of sales in the accompanying statements of operations. Sales are recorded net of sales returns and discounts, and sales are presented net of sales-related taxes. Because of the nature and quality of the Companys products, the Company provides for the estimated costs of warranties at the time revenue is recognized for a period of five years after purchase as a secondary warranty. The manufacturer also provides a warranty against certain manufacturing and other defects. As of June 30, 2020 and 2019, the Company accrued $102,350 and $82,350, respectively, for estimated product warranty claims, which is included in accrued expenses in the accompanying consolidated balance sheets. The accrued warranty costs are based primarily on historical warranty claims as well as current repair costs. There was $82,494 and $87,374 of warranty expense for the years ended June 30, 2020 and 2019, respectively. The Company negotiated a warranty settlement with one of its manufacturers. At June 30, 2020 and 2019, the Company accrued $124,437 and $209,316 payable to this manufacturer to be paid over 24 months. Product sales resulting from fixed-price contracts involve a signed contract for a fixed price or a binding purchase order to provide the Companys interactive panels and accessories. Contract arrangements exclude a right of return for delivered items. Product sales resulting from fixed-price contracts are generated from multiple-element arrangements that require separate units of accounting and estimates regarding the fair value of individual elements. The Company has determined that its multiple-element arrangements that qualify as separate units of accounting are product sales and (2) installation and related services. There is objective and reliable evidence of fair value for both the product sales and installation services and allocation of arrangement consideration for each of these units is based on their relative fair values. Each of these elements represent individual units of accounting, as the delivered item has value to a customer on a stand-alone basis. The Companys products can be sold on a stand-alone basis to customers which provides objective evidence of the fair value of the product portion of the multi-element contract, and thus represents the Companys best estimate of selling price. The fair value of installation services is separately calculated using expected costs of installation services. Many times, the value of installation services is calculated using price quotations from subcontractors to the Company who perform installation services on a stand-alone basis. The Company sells equipment with embedded software to its customers. The embedded software is not sold separately, and it is not a significant focus of the Companys marketing efforts. The Company does not provide post- contract customer support specific to the software or incur significant costs that are within the scope of FASB guidance on accounting for software to be leased or sold. Additionally, the functionality that the software provides is marketed as part of the overall product. The software embedded in the equipment is incidental to the equipment as a whole. Entertainment Theater Ticket Sales and Concessions Revenues are generated principally through admissions and concessions sales with proceeds received in cash or via credit card at the point of sale. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers cash and cash equivalents to be cash in all bank accounts, including temporary investments that have an original maturity of three months or less. From time to time, the Company has on deposit, in institutions whose accounts are insured by the Federal Deposit Insurance Corporation, funds in excess of the insured maximum. The at-risk amount is subject to significant daily fluctuation. The Company has never experienced any losses related to these balances, and as such, the Company does not believe it is exposed to any significant risk. | Cash and Cash Equivalents The Company considers cash and cash equivalents to be cash in all bank accounts, including money market and temporary investments that have an original maturity of three months or less. From time to time, the Company has on deposit, in institutions whose accounts are insured by the Federal Deposit Insurance Corporation, funds in excess of the insured maximum. The at-risk amount is subject to significant fluctuation daily throughout the year. The Company has never experienced any losses related to these balances, and as such, the Company does not believe it is exposed to any significant risk. |
Accounts Receivable | Accounts Receivable Accounts receivable is recognized when the Company's right to consideration is unconditional and is presented net of an allowance for doubtful accounts. Interest is not charged on past due accounts. Management reviews each receivable balance and estimates that portion, if any, of the balance that will not be collected. The carrying amount of accounts receivable is then reduced by an allowance based on management's estimate. Management deemed no allowance for doubtful accounts was necessary at September 30, 2020 and June 30, 2020. At September 30, 2020 and June 30, 2020, $1,145,187 and $670,031 of total accounts receivable were considered unbilled and recorded as deferred revenue. Accounts receivable unbilled is related to 1) a supply contract with a customer and 2) customers that are school districts. The unbilled accounts receivable and deferred revenue related to the supply contract are disclosed in Note 2. The remaining unbilled accounts receivable and deferred revenues are related to unconditional purchase orders from school districts; therefore, excluded from contract asset and liabilities. To enhance cash and liquidity, the Company factors trade accounts receivable with a financial services company. Factoring fees are 2.5% of the face value of the account receivable sold to the factoring agent per month until collected. For collections over 90 days from the invoice date, the fee increases to 3.5%. The proceeds received are included in cash provided by operating activities in the condensed consolidated statements of cash flows. The difference between the carrying amount of the trade receivables sold and the cash received is recorded as a general and administrative expense in the condensed consolidated statements of operations. For the three months ended September 30, 2020, expenses on sale of trade receivables was inconsequential. For the three months ended September 30, 2019, the Company did not factor accounts receivable. | Accounts Receivable Accounts receivable is recognized when the Companys right to consideration is unconditional and is presented net of an allowance for doubtful accounts. Interest is not charged on past due accounts. Management reviews each receivable balance and estimates that portion, if any, of the balance that will not be collected. The carrying amount of accounts receivable is then reduced by an allowance based on managements estimate. Management deemed no allowance for doubtful accounts was necessary at June 30, 2020 and 2019. At June 30, 2020 and 2019, $670,031 and $247,007 of total accounts receivable were considered unbilled and recorded as deferred revenue. |
Inventories | Inventories Inventory is stated at the lower of cost or net realizable value. Cost is determined on a first-in, first-out (FIFO) method of accounting. Galaxy inventory is comprised of interactive panels, audio and related accessories, and parts for audio products. Management estimates $67,635 of inventory reserves at September 30, 2020 and June 30, 2020. | Inventories Inventory is stated at the lower of cost or net realizable value. Cost is determined on a first-in, first-out (FIFO) method of accounting. All inventory at June 30, 2020 and 2019, represents goods available for sale. Galaxy inventory is primarily comprised of interactive panels, audio and related accessories. Management estimates $67,635 and $20,000 of inventory reserves at June 30, 2020 and 2019, respectively. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost less accumulated depreciation. Expenditures for repairs and maintenance are charged to expense as incurred and additions and improvements that significantly extend the lives of assets are capitalized. Upon sale or other retirement of depreciable property, the cost and accumulated depreciation are removed from the related accounts and any gain or loss is reflected in operations. Property and equipment and the estimated useful lives used in computing depreciation, are as follows: Furniture and fixtures 5 years Equipment 5 to 10 years Vehicles 5 years Depreciation is provided using the straight-line method over the estimated useful lives of the depreciable assets. Depreciation expense was $4,428 and $7,832 for the three months ended September 30, 2020 and 2019, respectively. | Property and Equipment Property and equipment are stated at cost less accumulated depreciation. Expenditures for repairs and maintenance are charged to expense as incurred and additions and improvements that significantly extend the lives of assets are capitalized. Upon sale or other retirement of depreciable property, the cost and accumulated depreciation are removed from the related accounts and any gain or loss is reflected in operations. Property and equipment and the estimated useful lives used in computing depreciation, are as follows: Furniture and fixtures 5 years Equipment 5 to 8 years Vehicles 5 years Building 40 years Building improvements 8 years Depreciation is provided using the straight-line method over the estimated useful lives of the depreciable assets. Depreciation expense was $29,795 and $221,260 for the years ended June 30, 2020 and 2019, respectively. |
Long-lived Assets | Long-lived Assets Long-lived assets to be held and used are tested for recoverability whenever events or changes in circumstances indicate that the related carrying amount may not be recoverable. When required, impairment losses on assets to be held and used are recognized based on the excess of the asset's carrying amount over the fair value of the asset. | Long-lived Assets Long-lived assets to be held and used are tested for recoverability whenever events or changes in circumstances indicate that the related carrying amount may not be recoverable. When required, impairment losses on assets to be held and used are recognized based on the excess of the assets carrying amount over the fair value of the asset. |
Goodwill | Goodwill and Intangible Assets Goodwill is not amortized, but is reviewed for impairment at least annually, or more frequently when events or changes in circumstances indicate that the carrying value may not be recoverable. Judgments regarding indicators of potential impairment are based on market conditions and operational performance of the business. At each fiscal year-end, the Company performs an analysis of goodwill or whenever events or circumstances arise that indicate an impairment may exist, such as the loss of a key executive, adverse industry and economic conditions, or increased or unexpected competition. The Company may assess its goodwill for impairment initially using a qualitative approach to determine whether conditions exist to indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying value. If management concludes, based on its assessment of relevant events, facts and circumstances that it is more likely than not that a reporting unit's carrying value is greater than its fair value, then a goodwill impairment charge is recognized for the amount in excess, not to exceed the total amount of goodwill allocated to that reporting unit. If the fair value of a reporting unit exceeds its carrying amount, goodwill is not considered to be impaired and no further testing is required. If determined to be impaired, an impairment charge is recorded as a general and administrative expense within the Company's condensed consolidated statements of operations. Management of the Company determined that a triggering event to assess goodwill impairment occurred during the year ended June 30, 2020 due to the separation of a key executive associated with their acquisition of Concepts and Solutions. While there was no single determinative event, the consideration in totality of several factors that developed led management to conclude that it was more likely than not that the fair values of certain intangible assets and goodwill acquired as part of that acquisition were below their carrying amounts. These factors included: a) former key executive separating from the Company; b) respective former key executive violating his noncompete changing the use and value of it; c) sustained decrease in the Company's share price which reduced market capitalization; and d) uncertainty in the United States and global economies due to Covid-19. As a result, the Company recorded a non-cash impairment loss of approximately $2,000,000, including $800,287 related to goodwill and $1,200,000 related to finite-lived intangibleassets. No such impairment charge was recorded during the three months ended September 30, 2020. | Goodwill Goodwill is attributed to the reverse merger of FullCircle Registry and the acquisition of Concepts and Solutions. Goodwill is reviewed for impairment at least annually, or more frequently when events or changes in circumstances indicate that the carrying value may not be recoverable. Judgments regarding indicators of potential impairment are based on market conditions and operational performance of the business. The Company may assess its goodwill for impairment initially using a qualitative approach to determine whether conditions exist to indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying value. If management concludes, based on its assessment of relevant events, facts and circumstances that it is more likely than not that a reporting units carrying value is greater than its fair value, then a goodwill impairment charge is recognized for the amount in excess, not to exceed the total amount of goodwill allocated to that reporting unit. If the fair value of a reporting unit exceeds its carrying amount, goodwill is not considered to be impaired and no further testing is required. If determined to be impaired, an impairment charge is recorded as a general and administrative expense within the Companys consolidated statement of operations. Management determined that a triggering event to assess goodwill impairment occurred in an interim period during the year ending June 30, 2020 due to the separation of a key executive associated with the acquisition of Concepts and Solutions. While there was no single determinative event, the consideration in totality of several factors that developed during the year of 2020 led management to conclude that it was more likely than not that the fair values of certain intangible assets and goodwill acquired as part of the Ehlert Solutions Group, Inc and Interlock Concepts, Inc acquisitions were below their carrying amounts. These factors included: a) former key executive separating from us; b) respective former key executive violating his noncompete changing the use and value of it; c) sustained decrease in our share price which reduced market capitalization; and d) uncertainty in the United States and global economies beginning in March 2020 due to the COVID-19 pandemic. As a result of the impairment test, the audited results for the year ended 2020 included non- cash impairment losses of $2,000,287, comprised of $800,287 related to goodwill and $1,200,000 related to finite-lived intangible assets. |
Intangible Assets | Intangible Assets Intangible assets are stated at the lower of cost or fair value. Intangible assets are amortized on a straight-line basis over periods ranging from two to five years, representing the period over which the Company expects to receive future economic benefits from these assets. The Company acquired intangible assets related to the acquisition of Concepts and Solutions. The Company impaired $1,200,000 of the intangible assets during an interim period of the year ended June 30, 2020. There were no further indicators of impairment of intangible assets as of June 30, 2020. Goodwill and intangible assets are comprised of the following at June 30, 2020: Cost Accumulated Amortization Net Book Value Impairment Total Goodwill $ 1.634.507 $ - $1,634,507 $ (800,287) $834,220 Finite-lived assets: Customer list $ 881,000 $ (132,147) $ 748,853 $ - $748,853 Vendor relationships 479,000 (71,847) 407,153 - 407,153 Noncompete agreement 1,600,000 (400,000) 1,200,000 (1,200,000) - Product development costs 81,845 (1,536) 280,309 - 280,309 $ 3,241,845 $ (605,530) $2,636,315 $(1,200,000) $1,436,315 Estimated amortization expense related to finite-lived intangible assets for the next five years is: $347,293 for fiscal year 2021, $353,660 for fiscal year 2022, $361,577 for fiscal year 2023, $290,432 for fiscal year 2024, and $288,890 for fiscal year 2025. There were no intangible assets as of June 30, 2019. | |
Product Development Costs | Product Development Costs Costs incurred in designing and developing classroom technology products are expensed as research and development until commercial viability has been established. Commercial viability is established upon completion of a detail product design, or a working model. Upon the achievement of commercial viability, development costs are capitalized and subsequently reported at the lower of unamortized cost or net realizable value. Management's judgment is required in determining whether a product provides new or additional functionality, the point at which a product enters the stages at which costs may be capitalized, assessing the ongoing value and impairment of the capitalized costs and determining the estimated useful life over which the costs are amortized. Annual amortization expense is calculated based on the straight-line method over the product's estimated economic life. Amortization of product development costs incurred begins when the related products are available for sale to customers. Amortization of product development costs of $12,512 and $0 for the three months ended September 30, 2020 and 2019, and is included in cost of sales in the Company's condensed consolidated statements of operations. | Product Development Costs Costs incurred in designing and developing classroom technology products are expensed as research and development until technological feasibility has been established. Technological feasibility is established upon completion of a detail product design, or in its absence, completion of a working model. Upon the achievement of technological feasibility, development costs are capitalized and subsequently reported at the lower of unamortized cost or net realizable value. Managements judgment is required in determining whether a product provides new or additional functionality, the point at which various products enter the stages at which costs may be capitalized, assessing the ongoing value and impairment of the capitalized costs and determining the estimated useful lives over which the costs are amortized. Annual amortization expense is calculated based on the straight-line method over the products estimated economic lives. Amortization of product development costs incurred begins when the related products are available for general release to customers. Amortization of product development costs of $1,536 and $0 for the years ended June 30, 2020 and 2019, is included in cost of revenues in the Companys consolidated statement of operations. |
Research and Development | Research and Development Research and development costs are expensed as incurred and totaled approximately $15,000 and $0 for the three months ended September 30, 2020 and 2019. | Research and Development Research and development costs are expensed as incurred and totaled $90,654 for the year ended June 30, 2020. There was no research and development costs for the year ended June 30, 2019. |
Warranty | Warranty The Company negotiated a warranty settlement with one of its manufacturers. At June 30, 2020, the Company accrued $124,437 payable to this manufacturer, with $0 recorded as a long-term portion of vendor payable. At June 30, 2019 the Company accrued $209,316 payable to this manufacturer to be paid over twenty-four months, with $174,703 recorded as a long-term vendor payable. | |
Leases | Leases The Company's leases relate primarily to corporate offices and warehouses. Effective July 1, 2019, the Company adopted the FASB guidance on leases ("Topic 842"), which requires leases with durations greater than twelve months to be recognized on the balance sheet. The Company adopted Topic 842 using the modified retrospective transition approach. | Leases The Companys leases relate primarily to corporate offices and warehouses. Effective July 1, 2019, the Company adopted the FASB guidance on leases (Topic 842), which requires leases with durations greater than twelve months to be recognized on the balance sheet. The Company adopted Topic 842 using the modified retrospective transition approach. |
Distinguishing Liabilities from Equity | Distinguishing Liabilities from Equity The Company relies on the guidance provided by ASC Topic 480, Distinguishing Liabilities from Equity, to classify certain convertible instruments. The Company first determines whether a financial instrument should be classified as a liability. The Company determines a liability classification if the financial instrument is mandatorily redeemable, or if the financial instrument, other than outstanding shares, embodies a conditional obligation that the Company must or may settle by issuing a variable number of its equity shares. If the Company determines that a financial instrument should not be classified as a liability, the Company determines whether the financial instrument should be presented between the liability section and the equity section of the balance sheet (temporary equity). The Company determines temporary equity classification if the redemption of the financial instrument is outside the control of the Company (i.e. at the option of the holder). Otherwise, the Company accounts for the financial instrument as permanent equity. Initial Measurement The Company records financial instruments classified as liability, temporary equity or permanent equity at issuance at the fair value, or cash received. Subsequent Measurement Financial Instruments Classified as Liabilities The Company records the fair value of financial instruments classified as liabilities at each subsequent measurement date. The changes in fair value of financial instruments classified as liabilities are recorded as other income (expense). | |
Income Taxes | Income Taxes The Company accounts for income taxes under the asset and liability method, whereby deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Current income taxes are recognized for the estimated income taxes payable or receivable on taxable income or loss from the current year and any adjustment to income taxes payable related to previous years. Current income taxes are determined using tax rates and tax laws that have been enacted or subsequently enacted by the year-end date. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse. Under the asset and liability method, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is recognized if it is more likely than not that some portion or all of the deferred tax asset will not be utilized. | Income Taxes The Company accounts for income taxes under the asset and liability method, whereby deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Current income taxes are recognized for the estimated income taxes payable or receivable on taxable income or loss from the current year and any adjustment to income taxes payable related to previous years. Current income taxes are determined using tax rates and tax laws that have been enacted or subsequently enacted by the year-end date. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse. Under the asset and liability method, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is recognized if it is more likely than not that some portion or all of the deferred tax asset will not be utilized. |
Stock-based Compensation | Stock-based Compensation The Company records stock-based compensation in accordance with the provisions set forth in ASC 718, Stock Compensation ("ASC 718"). ASC 718 requires companies to recognize the cost of employee services received in exchange for awards of equity instruments based upon the grant date fair value of those awards. The Company, from time to time, may issue common stock to acquire services or goods from non-employees. Common stock issued to persons other than employees or directors are recorded on the basis of their fair value. | Stock-based Compensation The Company records stock-based compensation in accordance with the provisions set forth in ASC 718, Stock Compensation. ASC 718 requires companies to recognize the cost of employee services received in exchange for awards of equity instruments based upon the grant date fair value of those awards. The Company, from time to time, may issue common stock to acquire services or goods from non- employees. Common stock issued to persons other than employees or directors are recorded on the basis of their fair value. |
Earnings (Loss) per Share | Earnings (Loss) per Share Basic and diluted earnings (loss) per common share is calculated using the weighted average number of common shares outstanding during the period. The Company's convertible notes and warrants are excluded from the computation of diluted earnings per share as they are anti-dilutive due to the Company's losses during those periods. | Earnings (Loss) per Share Basic and diluted earnings (loss) per common share is calculated using the weighted average number of common shares outstanding during the period. The Company's convertible notes and warrants are excluded from the computation of diluted earnings per share as they are anti-dilutive due to the Company's losses during those periods. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company categorized its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset. Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs. As of September 30, 2020 ,and June 30, 2020, the Company held certain financial assets and liabilities that are required to be measured at fair value on a recurring basis. All such assets and liabilities are considered to be Level 3 in the fair value hierarchy defined above. The Company analyzes all financial instruments with features of both liabilities and equity under ASC 480, "Distinguishing Liabilities from Equity," and ASC 815. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820) - Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement ("ASU 2018-13"). The amendments in ASU 2018-13 modify certain disclosure requirements of fair value measurements. The Company adopted ASU 2018-13 on July 1, 2020 with no impact to the condensed consolidated financial statements as a result. | Fair Value of Financial Instruments The Company categorized its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset. Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs. As of June 30, 2020 and 2019, the Company held certain financial assets and liabilities that are required to be measured at fair value on a recurring basis. All such assets and liabilities are considered to be Level 3 in the fair value hierarchy defined above. |
Derivative Liabilities | Derivative Liabilities The Company generally does not use derivative financial instruments to hedge exposures to cash flow or market risks. However, certain other financial instruments, such as warrants and embedded conversion features on the convertible debt, are classified as derivative liabilities due to protection provisions within the agreements. Such financial instruments are initially recorded at fair value using the Monte Carlo model and subsequently adjusted to fair value at the close of each reporting period. The Company accounts for derivative instruments and debt instruments in accordance with the interpretive guidance of ASC 815, ASU 2017-11, and associated pronouncements related to the classification and measurement of warrants and instruments with conversion features and anti-dilution clauses in agreements. | Derivative Liabilities The Company generally does not use derivative financial instruments to hedge exposures to cash flow or market risks. However, certain other financial instruments, such as warrants and embedded conversion features on the convertible debt, are classified as derivative liabilities due to protection provisions within the agreements. Such financial instruments are initially recorded at fair value using the Monte Carlo model and subsequently adjusted to fair value at the close of each reporting period. The Company accounts for derivative instruments and debt instruments in accordance with the interpretive guidance of ASC 815, ASU 2017-11, and associated pronouncements related to the classification and measurement of warrants and instruments with conversion features and anti-dilution clauses in agreements. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In January 2020, the FASB issued ASU No. 2020-01, "Investments - Equity Securities (Topic 321), Investments - Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) - Clarifying the Interactions between Topic 321, Topic 323, and Topic 815." The ASU is based on a consensus of the Emerging Issues Task Force and is expected to increase comparability in accounting for these transactions. ASU 2020-01 made targeted improvements to accounting for financial instruments, including providing an entity the ability to measure certain equity securities without a readily determinable fair value at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. Among other topics, the amendments clarify that an entity should consider observable transactions that require it to either apply or discontinue the equity method of accounting. For public business entities, the amendments in the ASU are effective for fiscal years beginning after December 15, 2021, and interim periods within those fiscal years. The Company is currently evaluating the impacts of adoption of the new guidance to its consolidated financial statements. In December 2019, the FASB issued ASU No. 2019-12 "Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes ("ASU 2019-12") by removing certain exceptions to the general principles. The amendments will be effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption of the amendments is permitted. Depending on the amendment, adoption may be applied on a retrospective, modified retrospective or prospective basis. The Company is currently evaluating the impacts of adoption of the new guidance to its consolidated financial statements. In August 2020, the FASB issued ASU 2020-06, Accounting for Convertible Instruments and Contracts in an Entity's Own Equity, which simplifies the accounting for certain convertible instruments, amends guidance on derivative scope exceptions for contracts in an entity's own equity and modifies the guidance on diluted EPS calculations as a result of these changes. The guidance in this ASU can be adopted using either a full or modified retrospective approach and becomes effective for annual reporting periods beginning after December 15, 2021, with early adoption permitted. The Company is currently evaluating the impact of this standard on its consolidated financial statements and disclosures. The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the consolidated financialstatements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations. | Recent Accounting Pronouncements In January 2020, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2020-01, Investments - Equity Securities (Topic 321), Investments - Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) - Clarifying the Interactions between Topic 321, Topic 323, and Topic 815. The ASU is based on a consensus of the Emerging Issues Task Force and is expected to increase comparability in accounting for these transactions. ASU 2020-01 made targeted improvements to accounting for financial instruments, including providing an entity the ability to measure certain equity securities without a readily determinable fair value at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. Among other topics, the amendments clarify that an entity should consider observable transactions that require it to either apply or discontinue the equity method of accounting. For public business entities, the amendments in the ASU are effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. The Company is currently evaluating the impacts of adoption of the new guidance to its consolidated financial statements. In December 2019, the FASB issued ASU No. 2019-12 Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes ("ASU 2019-12") by removing certain exceptions to the general principles. The amendments will be effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption of the amendments is permitted. Depending on the amendment, adoption may be applied on a retrospective, modified retrospective or prospective basis. The Company is currently evaluating the impacts of adoption of the new guidance to its consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820), which removes, modifies and adds various disclosure requirements around the topic in order to clarify and improve the cost-benefit nature of disclosures. For example, disclosures around transfers between fair value hierarchy levels will be removed and further detail around changes in unrealized gains and losses for the period and unobservable inputs determining Level 3 fair value measurements will be added. This standard is effective for fiscal years beginning after December 15, 2019, including interim periods within the fiscal year. The Company is currently evaluating the impact the new standard. In June 2016, the FASB issued ASU 2016-13, "Financial Instruments - Credit Losses ("ASU 2016-13"). This accounting standard update changes the accounting for recognizing impairments of financial assets. Under the update, credit losses for certain types of financial instruments will be estimated based on expected losses. The update also modifies the impairment models for available-for-sale debt securities and for purchased financial assets with credit deterioration since their origination. This update is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The Company is currently evaluating the impact of this accounting standard update. |
Reclassification | Reclassifications Certain amounts in the current condensed consolidated financial statements have been reclassified to conform to the current presentation. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Accounting Policies [Abstract] | ||
Schedule of Capital Structure | In accordance with ASC 505, Equity, the Company's capital structure is as follows: September 30, 2020 Authorized Issued Outstanding Common stock 4,000,000,000 2,194,557,083 2,194,518,458 $.0001 par value, one vote per share Preferred stock 200,000,000 - - $.0001 par value, one vote per share Preferred stock - Class A 750,000 - - $.0001 par value; no voting rights Preferred stock - Class B 1,000,000 - - Voting rights of 10 votes for 1 Preferred B share; 2% preferred dividend payable annually Preferred stock - Class C 9,000,000 - - $.0001 par value; 500 votes per share, convertible to common stock Preferred stock - Class D 1,000,000 - - $.0001 par value; no voting rights, convertible to common stock, mandatory conversion to common stock 18 months after issue Preferred stock - Class E 500,000 500,000 500,000 $.0001 par value; no voting rights, convertible to common stock June 30, 2020 Authorized Issued Outstanding Common stock 4,000,000,000 628,039,242 628,000,617 $.0001 par value, one vote per share Preferred stock 200,000,000 - - $.0001 par value, one vote per share Preferred stock - Class A 750,000 - - $.0001 par value; no voting rights Preferred stock - Class B 1,000,000 - - Voting rights of 10 votes for 1 Preferred B share; 2% preferred dividend payable annually Preferred stock - Class C 9,000,000 - - $.0001 par value; 500 votes per share, convertible to common stock Preferred stock - Class D 1,000,000 - - $.0001 par value; no voting rights, convertible to common stock, mandatory conversion to common stock 18 months after issue Preferred stock - Class E 500,000 500,000 500,000 $.0001 par value; no voting rights, convertible to common stock | The Companys capital structure is as follows: June 30, 2020 Authorized Issued Outstanding Common stock 4,000,000,000 628,039,242 628,000,617 $.0001 par value, one vote per share Preferred stock 200,000,000 - - $.0001 par value, one vote per share Preferred stock - Class A 750,000 - - $.0001 par value; no voting rights Preferred stock - Class B 1,000,000 - - Voting rights of 10 votes for 1 Preferred B share; 2% preferred dividend payable annually Preferred stock - Class C 9,000,000 - - $.0001 par value; 500 votes per share, convertible to common stock Preferred stock - Class D 1,000,000 - - $.0001 par value; no voting rights, convertible to common stock, mandatory conversion to common stock 18 months after issue Preferred stock - Class E 500,000 500,000 500,000 $.0001 par value; no voting rights, convertible to common stock June 30, 2019 Authorized Issued Outstanding Common stock 4,000,000,000 11,318,901 11,280,276 $.0001 par value, one vote per share Preferred stock 200,000,000 - - $.0001 par value, one vote per share Preferred stock - Class A 750,000 - - $.0001 par value; no voting rights Preferred stock - Class B 1,000,000 - - Voting rights of 10 votes for 1 Preferred B share; 2% preferred dividend payable annually Preferred stock - Class C 9,000,000 - - $.0001 par value; 500 votes per share, convertible to common stock |
Schedule of Useful lives of Property and Equipment | Property and equipment and the estimated useful lives used in computing depreciation, are as follows: Furniture and fixtures 5 years Equipment 5 to 10 years Vehicles 5 years | Property and equipment and the estimated useful lives used in computing depreciation, are as follows: Furniture and fixtures 5 years Equipment 5 to 8 years Vehicles 5 years Building 40 years Building improvements 8 years |
Schedule of Intangible Assets | The following tables shows goodwill, and finite-lived intangible assets, accumulated amortization, and the impairment charges: September 30, 2020 Cost Accumulated Amortization Net Book Value Impairment Total Goodwill $ 834,220 $ - $ 834,220 $ - $ 834,220 Finite-lived assets: Customer list $ 881,000 $ (168,293) $ 712,707 $ - $ 712,707 Vendor relationships 471,096 (95,797) 375,299 - 375,299 Capitalized product development costs 281,845 (14,048) 267,797 - 267,797 $ 1,633,941 $ (278,138) $ 1,355,803 $ - $1,355,803 June 30, 2020 Cost Accumulated Amortization Net Book Value Impairment Total Goodwill $ 1,634,507 $ - $ 1,634,507 $ (800,287) $ 834,220 Finite-lived assets: Customer list $ 881,000 $ (132,147) $ 748,853 $ - $ 748,853 Vendor relationships 479,000 (71,847) 407,153 - 407,153 Noncompete agreements 1,600,000 (400,000) 1,200,000 (1,200,000) - Capitalized product development costs 281,845 (1,536) 280,309 - 280,309 $ 3,241,845 $ (605,530) $ 2,636,315 $(1,200,000) $1,436,315 | Goodwill and intangible assets are comprised of the following at June 30, 2020: Cost Accumulated Amortization Net Book Value Impairment Total Goodwill $ 1.634.507 $ - $1,634,507 $ (800,287) $834,220 Finite-lived assets: Customer list $ 881,000 $ (132,147) $ 748,853 $ - $748,853 Vendor relationships 479,000 (71,847) 407,153 - 407,153 Noncompete agreement 1,600,000 (400,000) 1,200,000 (1,200,000) - Product development costs 81,845 (1,536) 280,309 - 280,309 $ 3,241,845 $ (605,530) $2,636,315 $(1,200,000) $1,436,315 |
Contract Balances (Tables)
Contract Balances (Tables) | 3 Months Ended |
Sep. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Contract Assets and Contract Liabilities | Contract assets and contract liabilities are as follows: September 30, 2020 June 30, 2020 Contract assets $ 756,800 $ - Contract liabilities 1,220,761 463,961 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Property, Plant and Equipment [Abstract] | ||
Schedule of Property and Equipment | Property and equipment are comprised of the following at: September 30, 2020 June 30, 2020 Vehicles $ 115,135 $ 115,135 Equipment 6,097 6,097 Furniture and fixtures 24,335 24,335 145,567 145,567 Accumulated depreciation (97,946) (93,518) Property and equipment, net $ 47,621 $ 52,049 | Property and equipment are comprised of the following at: 2020 2019 Vehicles $ 115,135 $ 74,755 Equipment 6,097 5,000 Furniture and fixtures 24,335 12,598 145,567 92,353 Accumulated depreciation (93,518) (65,588) Property and equipment, net $ 52,049 $ 26,765 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Schedule of Intangible Assets | The following tables shows goodwill, and finite-lived intangible assets, accumulated amortization, and the impairment charges: September 30, 2020 Cost Accumulated Amortization Net Book Value Impairment Total Goodwill $ 834,220 $ - $ 834,220 $ - $ 834,220 Finite-lived assets: Customer list $ 881,000 $ (168,293) $ 712,707 $ - $ 712,707 Vendor relationships 471,096 (95,797) 375,299 - 375,299 Capitalized product development costs 281,845 (14,048) 267,797 - 267,797 $ 1,633,941 $ (278,138) $ 1,355,803 $ - $1,355,803 June 30, 2020 Cost Accumulated Amortization Net Book Value Impairment Total Goodwill $ 1,634,507 $ - $ 1,634,507 $ (800,287) $ 834,220 Finite-lived assets: Customer list $ 881,000 $ (132,147) $ 748,853 $ - $ 748,853 Vendor relationships 479,000 (71,847) 407,153 - 407,153 Noncompete agreements 1,600,000 (400,000) 1,200,000 (1,200,000) - Capitalized product development costs 281,845 (1,536) 280,309 - 280,309 $ 3,241,845 $ (605,530) $ 2,636,315 $(1,200,000) $1,436,315 | Goodwill and intangible assets are comprised of the following at June 30, 2020: Cost Accumulated Amortization Net Book Value Impairment Total Goodwill $ 1.634.507 $ - $1,634,507 $ (800,287) $834,220 Finite-lived assets: Customer list $ 881,000 $ (132,147) $ 748,853 $ - $748,853 Vendor relationships 479,000 (71,847) 407,153 - 407,153 Noncompete agreement 1,600,000 (400,000) 1,200,000 (1,200,000) - Product development costs 81,845 (1,536) 280,309 - 280,309 $ 3,241,845 $ (605,530) $2,636,315 $(1,200,000) $1,436,315 |
Schedule of Amortization Expense | Estimated amortization expense related to intangible assets for the next five years is as follows: Period ending September 30, 2021 $ 347,293 2022 353,660 2023 361,577 2024 276,383 2025 16,890 $ 1,355,803 |
Notes Payable (Tables)
Notes Payable (Tables) | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Debt Disclosure [Abstract] | ||
Schedule of Long-term Notes Payable | Long Term Notes Payable September 30, 2020 June 30, 2020 Note payable with a bank bearing interest at 4% and maturing on June 26, 2020. The note was renewed by the lender with a revised maturity of June 26, 2021 and a lowered interest rate to 3%. The renewal provides for monthly interest payments and a balloon payment of outstanding principal and interest at maturity. The note is collateralized by a certificate of deposit owned by a related party. $275,200 $274,900 Long term PPP loan under the CARES Act bearing interest at 0.98% and maturing in April 2022. Monthly installments of principal and interest of $13,137 begin in October 2020. The loan is subject to forgiveness by the SBA. 310,832 310,832 Long term loan under Section 7(b) of the Economic Injury Disaster Loan program bearing interest at 3.75% and maturing in May 2050. Monthly installments of principal and interest of $731 begin in May 2021. 150,000 150,000 Financing lease liabilities for offices and warehouses with monthly installments of $12,449 (ranging from $1,083 to $3,524) over terms expiring through July 2022. 249,299 223,982 Financing leases with a related party for delivery vehicles with monthly installments totaling $813, including interest, over 5-year terms expiring through July 2020. - 1,245 Note payable with a finance company for delivery vehicle with monthly installments totaling $679 including interest at 8.99% over a 6 year term expiring in December 2025. 33,245 34,019 Total Notes Payable 1,018,576 994,978 Current Portion of Notes Payable 570,962 512,425 Long-term Portion of Notes Payable $ 447,614 $ 482,553 | The Company's long term notes payable obligations to unrelated parties are as follows at: 2020 2019 Note payable with a bank maturing on June 26, 2021 due to an extension, bearing interest at 3% and 4% for the years ended June 20, 2020 and 2019, respectively. Monthly interest payments of approximately $697 are due beginning July 26, 2020. The note is guaranteed by a stockholder and collateralized by a certificate of deposit owned by a related party. $ 274,900 $ 274,900 Long term PPP loan under the CARES Act bearing interest at 0.98% and maturing in April 2022. Monthly installments of principal and interest of $13,137 begin in October 2020. The loan is subject to forgiveness by the SBA. 310,832 - Long term loan under Section 7(b) of the Economic Injury Disaster Loan program bearing interest at 3.75% and maturing in May 2050. Monthly installments of principal and interest of $731 begin in May 2021. 150,000 - Financing lease liabilities for offices and warehouses with monthly installments of $19,173 (ranging from $1,083 to $4,806) over two year terms, expiring through July 2022. 223,982 - Financing leases with a related party for delivery vehicles with monthly installments totaling $813 (ranging from $352 to $461), including interest (ranging from 4.5% to 4.75%), over 5-year terms expiring through July 2020. One of the financing leases was paid in full in July 2019 leaving one delivery vehicle financing lease remaining. 1,245 6,053 Note payable with a finance company for delivery vehicle with monthly installments totaling $679 including interest at 8.99% over a 6 year term expiring in December 2025. Total Notes Payable 994,978 280,953 Current Portion of Notes Payable 512,425 279,346 Long-term Portion of Notes Payable $ 482,553 $ 1,607 |
Schedule of Minimum Future Principal Payments | Future minimum principal payments on the long-term notes payable to unrelated parties are as follows: Period ending September 30, 2021 $ 570,962 2022 247,194 2023 42,191 2024 10,230 2025 13,017 Thereafter 134,982 $ 1,018,576 | Future minimum principal payments on the non-related party long term notes payable are as follows: Year ending June 30, 2021 $ 512,425 2022 229,962 2023 93,555 2024 10,045 2025 10,807 Thereafter 138,184 $ 994,978 |
Schedule of Convertible Notes Payable | Convertible Notes September 30, 2020 June 30, 2020 On March 28, 2019, the Company signed a convertible promissory note with an investor. The $225,000 note was issued at a discount of $20,000 and bears interest at 10% per year. The Company issued 25,000 common shares to the investor. Three draws of $56,250, $112,500, and $56,250 were borrowed under this note. The note principal and interest were convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of the common stock during the 20 trading days immediately preceding the notice of conversion or (b) $3 per share, beginning in September 2019. The note had prepayment penalties ranging from 110% to 125% of the principal and interest outstanding if repaid within 60 to 180 days from issuance. The note matured in three intervals in March 2020, June 2020, and November 2020. The note was repaid by conversion to stock. $ - $24,150 On November 18, 2019, the Company signed a convertible promissory note with an investor. The $110,000 note was issued at a discount of $10,000 and bore interest at 8% per year. The note principal and interest were convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of common stock during the 15 trading days prior to the issue date or (b) 70% of the lowest traded price for the common stock during the 15 trading days prior to conversion of the note. The note matures in November 2020. The note had prepayment penalties between 115% and 125% of the principal and interest outstanding if repaid before 180 days from issuance. The note was repaid by conversion to stock. - 1,000 On December 11, 2019, the Company signed a convertible promissory note with an investor. The $220,430 note was issued at a discount of $15,430 and bore interest at 8% per year. The note principal and interest were convertible into shares of common stock at the lower of (a) $0.46 per share or (b) 75% of the lowest trading price of common stock during the 10 trading days prior to conversion beginning in June 2020. The note matured in December 2020. The note had prepayment penalties between 120% and 130% of the principal and interest outstanding if repaid before 180 days from issuance. The note was repaid by conversion to stock. - 121,200 On November 25, 2019, the Company signed a convertible promissory note with an investor. The $1,000,000 note was issued at a discount of $70,000 and bore interest at 8% per year. The note principal and interest up to $250,000 every 30-day calendar period were convertible into shares of common stock at the lower of (a) 75% of the lowest traded price of the common stock during the 10 trading days immediately preceding the notice of conversion or (b) $0.46 per share. The note matures in November 2020. The note had a redemption premium of 115% of the principal and interest outstanding if repaid before maturity. The note was repaid by conversion to stock. - 825,000 On January 9, 2020, the Company entered into a $225,000 convertible note. The $225,000 note was issued at a discount of $13,500 and bore interest at 8% per year. The note principal and interest were convertible into shares of common stock at the lower of (a) 75% of the lowest traded price of the common stock during the 10 trading days immediately preceding the notice of conversion or (b) the lowest traded price of the common stock during the 10 trading days prior to the issuance of this note. The note matured in October 2020. The note had prepayment penalties of 110% to 125% of the principal and interest outstanding if repaid before 180 days from issuance. The principal amount of the note was increased by $25,000 due to the value of the stock price at conversion. The note was repaid by conversion to stock. - 250,000 On March 25, 2020 the Company signed a convertible promissory note with an investor. The $338,625 note was issued at a discount of $23,625 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) $0.46 per share or (b) 75% of the lowest trading price of common stock during the 10 trading days prior to conversion. The note matures in March 2021. The note has prepayment penalties between 120% and 130% of the principal and interest outstanding if repaid before 180 days from issuance. The note was partially repaid by conversion to stock. 75,465 338,625 On June 26, 2020 the Company signed a convertible promissory note with an investor. The $430,000 note was issued at a discount of $30,000 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) $0.47 per share or (b) 70% of the lowest trading price of common stock during the 10 trading days prior to conversion. The note matures in June 2021. The note has prepayment penalties between 120% and 130% of the principal and interest outstanding if repaid before 180 days from issuance. 430,000 430,000 On July 20, 2019, the Company signed a convertible promissory note with an investor. The $125,000 note was issued at a discount of $8,750 and bores interest at 8% per year. The note principal and interest were convertible into shares of common stock at the lower of (a) 80% of the lowest traded price of the common stock during the 10 trading days immediately preceding the notice of conversion or (b) $0.47 per share. The note matured in July 2021. The note had a redemption premium of 115% of the principal and interest outstanding if repaid before maturity. The note is secured by a security interest in all assets of the Company. The note was borrowed and repaid by conversion to stock during the three months ended September 30, 2020. - - On August 18, 2020, the Company signed a convertible promissory note with an investor. The $500,000 note was issued at a discount of $35,000 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) 80% of the lowest traded price of the common stock during the 10 trading days immediately preceding the notice of conversion or (b) $0.47 per share. The note matures in August 2021. The note has a redemption premium of 115% of the principal and interest outstanding if repaid before maturity. The note is secured by a security interest in all assets of the Company. The note was partially repaid by conversion to stock during the three months ended September 30, 2020. 325,000 - On July 20, 2020 the Company signed a convertible promissory note with an investor. The $134,375 note was issued at a discount of $9,375 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) $0.47 per share or (b) 70% of the lowest trading price of common stock during the 10 trading days prior to conversion. The note matures in July 2021. The note contains a price protection clause where if the share price falls below $0.01 per share after six months, the conversion price discount increases by 5%. The note has prepayment penalties between 120% and 130% of the principal and interest outstanding if repaid before 180 days from issuance. 134,375 - On July 24, 2020, the Company entered into a $168,300 convertible note. The note was issued at a discount of $15,300 and bears interest at 12% per year. The note principal and interest are convertible into shares of common stock at 71% of the average of the lowest 2 trading prices during 15 trading days prior to conversion. The note matures in July 2021. The note has prepayment penalties of 110% to 125% of the principal and interest outstanding if repaid before 180 days from issuance. 168,300 - Total Convertible Notes Payable 1,133,140 1,989,975 Less: Unamortized original issue discounts 455,594 888,075 Current Portion of Convertible Notes Payable 677,546 1,101,900 Long-term Portion of Convertible Notes Payable $ - $ - | Convertible Notes Payable June 30,2020 June 30, 2019 On January 16, 2019, the Company signed a convertible promissory note with an investor. The $382,000 note was issued at a discount of $38,200 and bears interest at 12% per year. The Company issued 92,271 common shares to the investor. The note principal and interest are convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of the common stock during the 20 trading days immediately preceding the notice of conversion or (b) $3 per share, beginning in June 2019. The note matured in July 2019 and was converted to equity. $ - $ 382,000 On February 22, 2019, the Company signed a convertible promissory note with an investor. The $200,000 note was issued at a discount of $20,000 and bears interest at 5% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of the common stock during the 20 trading days immediately preceding the notice of conversion or (b) $3 per share, beginning in August 2019. The note was paid in full by partial conversion to stock and proceeds from issuance of debt. - 200,000 On March 28, 2019, the Company signed a convertible promissory note with an investor. The $225,000 note was issued at a discount of $20,000 and bears interest at 10% per year. The Company issued 25,000 common shares to the investor. Three draws of $56,250, $112,500, and $56,250 were borrowed under this note. The note principal and interest are convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of the common stock during the 20 trading days immediately preceding the notice of conversion or (b) $3 per share, beginning in September 2019. The note has prepayment penalties ranging from 110% to 125% of the principal and interest outstanding if repaid within 60 to 180 days from issuance. The note matures in three intervals in March 2020, June 2020, and November 2020. The note was partially repaid by conversion to stock. 24,150 168,750 On April 1, 2019, the Company signed a convertible promissory note with an investor. The $225,000 note was issued at a discount of $25,000 and bears interest at 10% per year. The Company issued 25,000 shares to the investor. An initial draw of $100,000 was borrowed under this note. The note principal and interest are convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of the common stock during the 20 trading days immediately preceding the notice of conversion. The note matures in April 2020. The note has prepayment penalties ranging from 110% to 125% of the principal and interest outstanding if repaid within 60 to 180 days from issuance. The note was paid in full by conversion to stock. - 112,500 On April 29, 2019, the Company signed a convertible promissory note with an investor. The $1,325,000 note was issued at a discount of $92,750 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) 75% of the lowest traded price of the common stock during the 10 trading days immediately preceding the notice of conversion or (b) $2.75 per share. The note matures in April 2020. The note has prepayment penalties of 120% of the sum of the outstanding principal, plus accrued interest, plus defaulted interest, plus any additional principal, plus at the holder's option, any amounts owed to the holder pursuant to any other provision of the note. The note was paid in full with proceeds from issuance of debt and preferred stock. - 1,325,000 On May 28, 2019, the Company signed a convertible promissory note with an investor. The $322,580 note was issued at a discount of $22,580 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) 75% of the lowest traded price of the common stock during the 10 trading days immediately preceding the notice of conversion or (b) $2.75 per share beginning in November 2019. The note matures in May 2020. The note has prepayment penalties of 120% of the principal and interest outstanding if repaid before 180 days from issuance. The note was repaid by a combination of conversion to stock and cash. - 322,580 On June 18, 2019, the Company signed a convertible promissory note with an investor. The $366,120 note was issued at a discount of $27,120 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at 75% of the lowest traded price of the common stock during the 10 trading days immediately preceding the notice of conversion. The note matures in May 2020. The note has prepayment penalties of 120% of the principal and interest outstanding if repaid before 180 days from issuance. The note was repaid by conversion to stock. - 366,120 On August 6, 2019, the Company signed a convertible promissory note with an investor. The $220,000 note was issued at a discount of $20,000 and bears interest at 12% per year. The note principal and interest are convertible into shares of common stock at 75% of the lowest traded price of the common stock during the 10 trading days immediately preceding the notice of conversion. The note matures in August 2020. The note has prepayment penalties of 120% of the principal and interest outstanding if repaid before 180 days from issuance. The note was repaid by conversion to stock. - - On August 29, 2019, the Company signed a convertible promissory note with an investor. The $234,726 note was issued at a discount of $16,376 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at 75% of the lowest traded price of the common stock during the 10 trading days immediately preceding the notice of conversion. The note matures in August 2020. The note has prepayment penalties of 120% of the principal and interest outstanding if repaid before 180 days from issuance. The note was repaid by conversion to stock. - - On November 18, 2019, the Company signed a convertible promissory note with an investor. The $55,000 note was issued at a discount of $5,000 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of common stock during the 15 trading days prior to the issue date or (b) 70% of the lowest traded price for the common stock during the 15 trading days prior to conversion of the note. The note matures in November 2020. The note has prepayment penalties between 115% and 125% of the principal and interest outstanding if repaid before 180 days from issuance. The note was repaid by conversion to stock. - - On November 18, 2019, the Company signed a convertible promissory note with an investor. The $110,000 note was issued at a discount of $10,000 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of common stock during the 15 trading days prior to the issue date or (b) 70% of the lowest traded price for the common stock during the 15 trading days prior to conversion the note. The note matures in November 2020. The note has prepayment penalties between 115% and 125% of the principal and interest outstanding if repaid before 180 days from issuance. The note was partially repaid by conversion to stock. 1,000 - On December 11, 2019, the Company signed a convertible promissory note with an investor. The $220,430 note was issued at a discount of $15,430 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) $0.46 per share or (b) 75% of the lowest trading price of common stock during the 10 trading days prior to conversion beginning in June 2020. The note matures in December 2020. The note has prepayment penalties between 120% and 130% of the principal and interest outstanding if repaid before 180 days from issuance. The note was partially repaid by conversion to stock. 121,200 - On November 25, 2019, the Company signed a convertible promissory note with an investor. The $1,000,000 note was issued at a discount of $70,000 and bears interest at 8% per year. The note principal and interest up to $250,000 every 30-day calendar period are convertible into shares of common stock at the lower of (a) 75% of the lowest traded price of the common stock during the 10 trading days immediately preceding the notice of conversion or (b) $0.46 per share. The note matures in November 2020. The note has a redemption premium of 115% of the principal and interest outstanding if repaid before maturity. The note was partially repaid by conversion to stock. 825,000 - On January 9, 2020, the Company entered into a $225,000 convertible note. The $225,000 note was issued at a discount of $13,500 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) 75% of the lowest traded price of the common stock during the 10 trading days immediately preceding the notice of conversion or (b) the lowest traded price of the common stock during the 10 trading days prior to the issuance of this note. The note matures in October 2020. The note has prepayment penalties of 110% to 125% of the principal and interest outstanding if repaid before 180 days from issuance. The note was increased by $25,000 due to the value of the stock price at conversion. 250,000 - On January 27, 2020, the Company entered into a $223,300 convertible note. The $223,300 note was issued at a discount of $20,300 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at 75% of the average of the lowest 3 trading prices during 15 trading days prior to conversion. The note matures in January 2021. The note has prepayment penalties of 110% to 125% of the principal and interest outstanding if repaid before 180 days from issuance. The note was repaid by conversion to stock. - - On March 25, 2020 the Company signed a convertible promissory note with an investor. The $338,625 note was issued at a discount of $23,625 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) $0.46 per share or (b) 75% of the lowest trading price of common stock during the 10 trading days prior to conversion. The note matures in March 2021. The note has prepayment penalties between 120% and 130% of the principal and interest outstanding if repaid before 180 days from issuance. 338,625 - On June 26, 2020 the Company signed a convertible promissory note with an investor. The $430,000 note was issued at a discount of $30,000 and bears interest at 8% per year. The note principal and interest are convertible into shares of common stock at the lower of (a) $0.47 per share or (b) 70% of the lowest trading price of common stock during the 10 trading days prior to conversion. The note matures in June 2021. The note has prepayment penalties between 120% and 130% of the principal and interest outstanding if repaid before 180 days from issuance. 430,000 - Total Convertible Notes Payable 1,989,975 2,876,950 Less: Unamortized original issue discounts 888,075 752,126 Current Portion of Convertible Notes Payable 1,101,900 2,124,824 Long-term Portion of Convertible Notes Payable $ - $ - |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | ||
Schedule of Fair Values Determined by Level 3 Inputs | The following table presents information about the assets and liabilities that are measured at fair value on a recurring basis at September 30, 2020 and June 30, 2020 and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value. At September 30, 2020 Total Level 1 Level 2 Level 3 Assets Customer List $704,803 - - $704,803 Vendor Relationship 383,203 - - 383,203 Development Costs 287,797 - - 287,797 $1,355,803 - - $1,355,803 Liabilities Original Issue discount, convertible debt $1,276,312 - - $1,276,312 At June 30, 2020 Total Level 1 Level 2 Level 3 Assets Customer list $748,847 - - $748,847 Vendor relationship 407,153 - - 407,153 Development costs 280,315 - - 280,315 $1,436,315 - - $1,436,315 Liabilities Original issue discount, convertible debt $213,300 - - $213,300 Derivative liability warrants 33,312 - - 33,312 Total $246,612 - - $246,612 | The following table presents information about the assets and liabilities that are measured at fair value on a recurring basis at June 30, 2020 and 2019 and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value. At June 30, 2020 Assets: Total Level 1 Level 2 Level 3 Goodwill $ 834,220 $ - $ - $ 834,220 Customer list 748,853 - - 748,853 Vendor relationship 407,153 - - 407,153 Development costs 280,315 - - 280,315 $1,990,226 $ - $ - $1,990,226 Liabilities: Original issue discount, convertible debt $ 213,300 $ - $ - $ 213,300 Derivative liability, warrants 33,312 - - 33,312 Total: $ 246,612 $ - $ - $ 246,612 At June 30, 2019 Liabilities: Total Level 1 Level 2 Level 3 Original issue discount, convertible debt $979,569 $ - $ - $ 979,569 Derivative liability, warrants 46,375 - - 46,375 Total: $ 1,025,944 $- $- $ 1,025,944 |
Schedule of Derivative Liability Valued Using Monte Carlo Pricing Model | The derivative liability was valued using the Monte Carlo pricing model with the following inputs: At September 30, 2020 Risk-free interest rate: 0.08% Expected dividend yield: 0.00% Expected stock price volatility: 325.00% Expected option life in years: 0.48 to 1.44 years At June 30, 2020 Risk-free interest rate: 0.09% Expected dividend yield: 0.00% Expected stock price volatility: 300.00% Expected option life in years: .085 to 1.69 years | The derivative liability was valued using the Monte Carlo pricing model with the following inputs: At June 30, 2020 Risk-free interest rate: 0.09% Expected dividend yield: 0.00% Expected stock price volatility: 300.00% Expected option life in years: .089 to 1.69 years At June 30, 2019 Risk-free interest rate: 1.72 -2.83% Expected dividend yield: 0.00% Expected stock price volatility: 180.00% Expected option life in years: 2.80 to 3.00 years |
Schedule of Reconciliation of Changes in Fair Value of Convertible Debt | The following table sets forth a reconciliation of changes in the fair value of the Company's convertible debt components classified as Level 3 in the fair value hierarchy at September 30, 2020 and June 30, 2020: Balance at June 30, 2020 $ 246,612 Additional convertible securities at inception 2,000 Realized (5,300) Unrealized 1,033,000 Ending balance at September 30, 2020 $ 1,276,312 Balance at June 30, 2019 $ 1,025,944 Additional convertible securities at inception 2,027,000 Settlement of conversion features and warrants (152,374) Realized (240,903) Unrealized (2,413,055) Ending balance at June 30, 2020 $ 246,612 | The following table sets forth a reconciliation of changes in the fair value of the Companys convertible debt components classified as Level 3 in the fair value hierarchy at June 30, 2020: Balance at June 30, 2019 $ 1,025,944 Convertible securities at inception 2,027,000 Settlement of conversion features and warrants (152,374) Realized (240,903) Unrealized (2,413,055) Balance at June 30, 2020 $ 246,612 Balance at June 30, 2018 $ - Convertible securities at inception 1,238,359 Settlement of conversion features and warrants (301,613) Realized (83,487) Unrealized 172,685 Balance at June 30, 2019 $ 1,025,944 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Related Party Transactions [Abstract] | ||
Schedule of Notes Payable Obligations to Related Parties Assumed in Acquisition | September 30, 2020 June 30, 2020 Note payable to a stockholder in which the $200,000 principal plus $10,000 of interest was payable in December 2019. Borrowings under the note increased to $400,000 and the maturity was extended to November 2021. The note bears interest at 6% interest and is payable in cash or common stock, at the Company's option. If interest is paid in common stock, the conversion price will be the market price at the time of conversion. Principal on the note at maturity is convertible into 400,000 shares of Series D Preferred Stock. If principal is paid prior to maturity, the right of conversion is terminated. $400,000 $400,000 Fair value of unsecured notes payable to seller of Concepts and Solutions, a related party, bearing interest at 3% per year, payable in annual installments through November 30, 2021. Payments are subject to adjustment based on the achievement of minimum gross revenues and successful completion of certain pre-acquisition withholding tax issues of Concepts and Solutions. 1,030,079 1,030,079 Note payable to a stockholder in which the note principal plus 6% interest is payable in November 2021. Note was amended in March 2020 by increasing the available borrowings to $1,225,000 and extending the maturity to March 2022. Interest is payable in cash or common stock, at the holder's option. If interest is paid in common stock, the conversion price will be the market price at the time of conversion. Principal on the note at maturity is convertible into 1,000,000 shares of Series D Preferred Stock. If principal is paid prior to maturity, the right of conversion is terminated. 1,225,000 1,225,000 Note payable to a stockholder in which the note principal plus 6% interest is payable in November 2021. Interest is payable in cash or common stock, at the Company's option. If interest is paid in common stock, the conversion price will be the market price at the time of conversion. Principal on the note at maturity is convertible into 200,000 shares of Series D Preferred Stock. If principal is paid prior to maturity, the right of conversion is terminated. 200,000 200,000 Note payable to a stockholder in which the note principal plus interest at 10% is payable the earlier of 60 days after invoicing a certain customer, or April 2021, due to an extension granted by the lender. The note is collateralized by a security interest in a certain customer purchase order. 385,000 385,000 Other short term payables due to stockholders and related parties 74,323 107,733 Total Related Party Notes Payable and Other Payables 3,314,402 3,347,812 Current Portion of Related Party Notes Payable and Other Payables 1,239,402 1,272,812 Long-term Portion of Related Party Notes Payable and Other Payables $2,075,000 $2,075,000 | The Company's notes payable obligations to related parties are as follows: June 30, 2020 June 30, 2019 Note payable to a stockholder in which the $200,000 principal plus $10,000 of interest was payable in December 2019. Borrowings under the note increased and the maturity was extended to November 2021. The note bears interest at 6% interest and is payable in cash or common stock, at the Company's option. If interest is paid in common stock, the conversion price will be the market price at the time of conversion. Principal on the note at maturity is convertible into 400,000 shares of Series D Preferred Stock. If principal is paid prior to maturity, the right of conversion is terminated. 400,000 $ 200,000 Fair value of unsecured notes payable to seller of Concepts and Solutions, a related party, bearing interest at 3% per year, payable in annual installments through November 30, 2021. Payments are subject to adjustment based on the achievement of minimum gross revenues and successful completion of certain pre-acquistion withholding tax issues of Concepts and Solutions. 1,030,079 - Note payable to a stockholder in which the note principal plus 6% interest is payable in November 2021. Note was amended in March 2020 by increasing the balance by $225,000 and extending the maturity to March 2022. Interest is payable in cash or common stock, at the holders option. If interest is paid in common stock, the conversion price will be the market price at the time of conversion. Principal on the note at maturity is convertible into 1,000,000 shares of Series D Preferred Stock. If principal is paid prior to maturity, the right of conversion is terminated. 1,225,000 - Note payable to a stockholder in which the note principal plus 6% interest is payable in November 2021. Interest is payable in cash or common stock, at the Company's option. If interest is paid in common stock, the conversion price will be the market price at the time of conversion. Principal on the note at maturity is convertible into 200,000 shares of Series D Preferred Stock. If principal is paid prior to maturity, the right of conversion is terminated. 200,000 - Note payable to a stockholder in which the note principal plus interest at 10% is payable the earlier of 60 days after invoicing a certain customer, or August 20, 2020. On August 20, 2020, the interest on the note was paid and the note was renewed with an extension of the maturity date to March 30, 2021. The note is collateralized by a security interest in a certain customer purchase order. 385,000 - Other short term payables due to stockholders and related parties 107,733 - Total Related Party Notes Payable and Other Payables 3,347,812 200,000 Current Portion of Related Party Notes Payable and Other Payables 1,272,812 200,000 Long-term Portion of Related Party Notes Payable and Other Payables 2,075,000 $ - |
Schedule of Future Maturities of Notes Payable | Future maturities of related party notes payable are as follows: Period ending September 30, 2021 $ 1,239,402 2022 2,075,000 $3,314,402 |
Lease Agreements (Tables)
Lease Agreements (Tables) | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Leases [Abstract] | ||
Schedule of Operating Lease Right-of-Use Assets and Operating Lease Liabilities | Right-of-use assets: Operating right-of-use assets $249,299 Operating lease liabilities: Current portion of long term payable 135,099 Financing leases payable, less current portion 114,200 Total financing lease liabilities $249,299 | Right of use assets Operating right of use assets $ 223,982 Operating lease liabilities Current portion of long term notes payable 114,288 Notes payable, less current portion 109,694 Total operating lease liabilities $ 223,982 |
Schedule of Operating Lease Maturities | As of September 30, 2020, financing lease maturities are as follows: Period ending September 30, 2021 $135,099 2022 81,523 2022 32,677 $249,299 | As of June 30, 2020, operating lease maturities are as follows: Period ending June 30, 2021 $ 114,288 2022 109,694 $ 223,982 |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Income Tax Disclosure [Abstract] | ||
Schedule of Effective Tax Rate Differed from Federal Statutory Income Tax Rate | The Company's effective tax rate differed from the federal statutory income tax rate for the three months ended September 30, 2020 and 2019 as follows: Federal statutory rate 21% State tax, net of federal tax effect 5.31% Valuation allowance -26% Effective tax rate 0% | The Companys effective tax rate differed from the federal statutory income tax rate for the years ended June 30, 2020 and 2019 as follows: Federal statutory rate 21% State tax, net of federal tax effect 5.31% Valuation allowance -26% Effective tax rate 0% |
Schedule of Deferred Tax Assets and Liabilities | The Company's deferred tax assets and liabilities as of September 30, 2020 and June 30, 2020, are summarized as follows: September 30, 2020 June 30, 2020 Federal Deferred tax assets $ 7,216,100 $ 4,825,100 Less valuation allowance (7,216,100) (4,825,100) Deferred tax liabilities - - - - State Deferred tax assets 1,926,900 1,290,900 Less valuation allowance (1,926,900) (1,290,900) Deferred tax liabilities - - - - Net Deferred Tax Assets $ - $ - | The Companys deferred tax assets and liabilities as of June 30, 2020 and 2019, are summarized as follows: 2020 2019 Federal Deferred tax assets $ 4,825,100 $ 2,980,100 Less valuation allowance (4,825,100) (2,980,100) Deferred tax liabilities - - State Deferred tax assets 1,290,900 866,300 Less valuation allowance (1,290,900) (866,300) Deferred tax liabilities - - - - Net Deferred Tax Assets $ - $ - |
Schedule of Significant Components of Deferred Tax Assets | The significant components of deferred tax assets as of September 30, 2020 and June 30, 2020, are as follows: September 30, 2020 June 30, 2020 Net operating loss carryforwards $ 8,681,800 $ 5,767,000 Valuation allowance (9,143,000) (6,116,000) Goodwill 273,600 278,900 Property and equipment (10,200) (10,500) Intangible assets 153,000 35,800 Inventory allowance 17,800 17,800 Warranty accrual and other 27,000 27,000 Net Deferred Tax Assets $ - $ - | The significant components of deferred tax assets as of June 30, 2020 and 2019, are as follows: 2020 2019 Net operating loss carryforwards $ 5,767,000 $ 3,826,100 Valuation allowance (6,116,000) (3,846,400) Property and equipment (10,500) (7,100) Goodwill 278,900 - Intangible assets 35,800 - Inventory allowance 17,800) 5,400 Warranty accrual 27,000 22,000 Net Deferred Tax Assets $ - $ - |
Acquisitions (Tables)
Acquisitions (Tables) | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Schedule of identifiable assets and liabilities | The following table presents a summary of Entertainments identifiable assets and liabilities at February 6, 2019, the date of the sale: Assets Cash $ 36,290 Property and equipment, net 4,006,426 Receivables 4,500 Inventories 5,610 Other assets 1,522,714 Total Assets 5,575,540 Liabilities Accounts payable 22,424 Debt 5,393,623 Accrued expenses 127,481 Total Liabilities 5,543,528 Net Assets $ 32,012 Noncash consideration for net assets of Entertainment 92,700 Gain on Sale $ 60,688 | |
Schedule of assets and liabilities as of the acquisition date through pushdown accounting | The following table summarizes the preliminary allocation of the fair value of the assets and liabilities as of the acquisition date through pushdown accounting. The preliminary allocation to certain assets and/or liabilities may be adjusted by material amounts as the Company finalizes fair value estimates. Assets Cash $ 201,161 Accounts receivable 1,165,953 Inventory 94,360 Property and equipment 20,904 Other assets 2,800 Goodwill and other intangibles 3,760,287 Total Assets 5,245,465 Liabilities Accounts payable 1,225,734 Accrued expenses 783,540 Short-term debt 96,941 Deferred revenue 518,900 Total Liabilities 2,625,115 Net Assets $ 2,620,350 Consideration Fair value of anti-dilution clause in employment agreement $ 235,350 Note payable to seller 900,000 Stock 1,485,000 $ 2,620,350 | |
FLCR [Member] | ||
Schedule of preliminary allocation of fair value of assets and liabilities | The following table summarizes the preliminary allocation of the fair value of the assets and liabilities as of the merger date through pushdown accounting. The preliminary allocation to certain assets and/or liabilities may be adjusted by material amounts as the Company finalizes fair value estimates. Assets Cash $ 22,205 Property and equipment 4,209,995 Other 20,716 Other assets 1,511,844 Goodwill 892,312 Total Assets 6,657,072 Liabilities Accounts payable 208,763 Long-term debt 4,593,851 Short-term debt 799,534 Accrued interest 78,948 Other 83,664 Total Liabilities 5,764,760 Net Assets $ 892,312 Consideration $ 58,092 Fair value of noncontrolling interest 834,220 $ 892,312 | |
Concepts and Solutions [Member] | ||
Schedule of preliminary allocation of fair value of assets and liabilities | The following table summarizes the preliminary allocation of the fair value of the assets and liabilities as of the acquisition date through pushdown accounting. The preliminary allocation to certain assets and/or liabilities may be adjusted by material amounts as the Company finalizes fair value estimates. Assets Cash $ 201,161 Accounts receivable 1,165,953 Inventory 94,360 Property and equipment 20,904 Other assets 2,800 Goodwill and other intangibles 3,760,287 Total Assets 5,245,465 Liabilities Accounts payable 1,225,734 Accrued expenses 783,540 Short-term debt 96,941 Deferred revenue 518,900 Total Liabilities 2,625,115 Net Assets $ 2,620,350 Consideration Fair value of anti-dilution clause in employment agreement $ 235,350 Note payable to seller 900,000 Stock 1,485,000 $ 2,620,350 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Narrative) (Details) - USD ($) | Sep. 04, 2019 | Feb. 06, 2019 | May 31, 2020 | Apr. 30, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2018 |
Delayed payment of certain payroll tax payments | $ 19,517 | $ 19,517 | |||||||
Maturity date | Oct. 29, 2021 | ||||||||
Interest rate | 3.75% | 4.25% | 6.00% | ||||||
Purchase price for acquisition in shares | 38,625 | ||||||||
Increase in Authorized shares of Common stock | 4,000,000,000 | ||||||||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||||
Accrued Expense | $ 102,350 | $ 102,350 | $ 82,350 | ||||||
Warranty expenses | 1,391 | $ 82,494 | 82,494 | 87,374 | |||||
Impairment losses | 2,000,287 | ||||||||
Goodwill impairment losses | 800,287 | ||||||||
Impairment of intangible assets | 1,200,000 | ||||||||
Estimated amortization expense related to intangible assets 2021 | 347,293 | 347,293 | |||||||
Estimated amortization expense related to intangible assets 2022 | 353,660 | 353,660 | |||||||
Estimated amortization expense related to intangible assets 2023 | 361,577 | 361,577 | |||||||
Estimated amortization expense related to intangible assets 2024 | 276,383 | 290,432 | |||||||
Estimated amortization expense related to intangible assets 2025 | 16,890 | 288,890 | |||||||
Amortization of product development costs | 12,512 | 0 | 1,536 | 0 | |||||
Research and development cost | 15,000 | 0 | 90,654 | ||||||
Depreciation expense | $ 84,940 | $ 7,832 | $ 644,545 | 221,260 | |||||
Number of Common shares exchange | 38,625 | ||||||||
Common shares reserved under terms of the convertible debt agreements and Stock Plan | 1,101,609,009 | 3,063,998,537 | |||||||
Restricted common shares issued | 125,953,028 | 16,305,023 | |||||||
Accrued payable | $ 87,720 | $ 124,437 | 209,316 | ||||||
Accounts receivable - unbilled | 1,145,187 | 670,031 | 247,007 | ||||||
Inventory reserves | $ 67,635 | $ 67,635 | 20,000 | ||||||
Percentage of fees collection | 2.50% | ||||||||
Percentage of collection fee increase | 3.50% | ||||||||
Minimum [Member] | |||||||||
Useful life of intangible assets | 2 years | ||||||||
Maximum [Member] | |||||||||
Useful life of intangible assets | 5 years | ||||||||
Concepts and Solutions [Member] | |||||||||
Percentage of stock acquired under stock purchase agreement | 100.00% | ||||||||
Purchase price for acquisition in shares | 1,350,000 | ||||||||
Purchase price for acquisition in notes payable to seller | $ 3,000,000 | ||||||||
Manufacturer [Member] | |||||||||
Accrued payable | $ 124,437 | 209,316 | |||||||
Long-term vendor payable [Member] | |||||||||
Accrued payable | $ 0 | $ 174,703 | |||||||
Paycheck Protection Program Loan [Member] | |||||||||
Unsecured loan | $ 311,000 | ||||||||
Maturity date | Apr. 30, 2022 | ||||||||
Interest rate | 0.98% | ||||||||
U.S. Small Business Administration [Member] | |||||||||
Secured loan | $ 150,000 | ||||||||
Maturity date | May 31, 2050 | ||||||||
Interest rate | 3.75% |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Schedule of Capital Structure) (Details) - USD ($) | Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2018 |
Common Stock, Shares Authorized | 4,000,000,000 | 4,000,000,000 | 4,000,000,000 | |
Common Stock, Shares, Issued | 2,194,557,083 | 628,039,242 | 11,318,901 | |
Common Stock, Shares, Outstanding | 2,194,518,458 | 628,000,617 | 11,280,276 | |
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Preferred Stock, Shares Authorized | 200,000,000 | 200,000,000 | 200,000,000 | |
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | |
Preferred Class A [Member] | ||||
Preferred Stock, Shares Authorized | 750,000 | 750,000 | 750,000 | |
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | |
Preferred Class B [Member] | ||||
Preferred Stock, Shares Authorized | 1,000,000 | 1,000,000 | 1,000,000 | |
Preferred Class C [Member] | ||||
Preferred Stock, Shares Authorized | 9,000,000 | 9,000,000 | 9,000,000 | |
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | |
Preferred Class D [Member] | ||||
Preferred Stock, Shares Authorized | 1,000,000 | 1,000,000 | ||
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | ||
Preferred Class E [Member] | ||||
Preferred Stock, Shares Authorized | 500,000 | 500,000 | ||
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | ||
Preferred stock, shares, Issued | 500,000 | 500,000 | ||
Preferred stock, shares, Outstanding | $ 500,000 | $ 500,000 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Schedule of Useful lives of Property and Equipment) (Details) | 3 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Jun. 30, 2020 | |
Furniture and fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years | 5 years |
Equipment [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years | 5 years |
Equipment [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 10 years | 8 years |
Vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years | 5 years |
Building [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 40 years | |
Building Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 8 years |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies (Schedule of Finite Lived Assets) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | |
Finite-lived assets: | |||
Cost | $ 1,633,941 | $ 3,241,845 | |
Accumulated Amortization | (278,138) | (605,530) | |
Net Book Value | 1,355,803 | 1,436,315 | |
Impairment | (2,000,287) | ||
Total | 1,355,803 | 1,436,315 | |
Customer List [Member] | |||
Finite-lived assets: | |||
Cost | 881,000 | 881,000 | |
Accumulated Amortization | (168,293) | (132,147) | |
Net Book Value | 712,707 | 748,853 | |
Impairment | |||
Total | 712,707 | 748,853 | |
Vendor relationships [Member] | |||
Finite-lived assets: | |||
Cost | 471,096 | 479,000 | |
Accumulated Amortization | (95,797) | (71,847) | |
Net Book Value | 375,299 | 407,153 | |
Impairment | |||
Total | 375,299 | 407,153 | |
Noncompete Agreement [Member] | |||
Finite-lived assets: | |||
Cost | 1,600,000 | ||
Accumulated Amortization | (400,000) | ||
Net Book Value | 1,200,000 | ||
Impairment | (1,200,000) | ||
Total | |||
Product Development Costs [Member] | |||
Finite-lived assets: | |||
Cost | 81,845 | ||
Accumulated Amortization | (1,536) | ||
Net Book Value | 280,309 | ||
Impairment | |||
Total | 280,309 | ||
Goodwill [Member] | |||
Finite-lived assets: | |||
Cost | 834,220 | 1,634,507 | |
Accumulated Amortization | |||
Net Book Value | 834,220 | 1,634,507 | |
Impairment | (800,287) | ||
Total | $ 834,220 | $ 834,220 |
Contract Balances (Narrative) (
Contract Balances (Narrative) (Details) | 3 Months Ended |
Sep. 30, 2020USD ($) | |
Revenue from Contract with Customer [Abstract] | |
Recognized revenue | $ 54,939 |
Contract Balances (Schedule of
Contract Balances (Schedule of Contract Assets and Contract Liabilities) (Details) - USD ($) | Sep. 30, 2020 | Jun. 30, 2020 |
Revenue from Contract with Customer [Abstract] | ||
Contract assets | $ 756,800 | |
Contract liabilities | $ 1,220,761 | $ 463,961 |
Property and Equipment (Schedul
Property and Equipment (Schedule of Property and Equipment) (Details) - USD ($) | Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 |
Property, Plant and Equipment [Line Items] | |||
Property and equipment, Gross | $ 145,567 | $ 145,567 | $ 92,353 |
Accumulated depreciation | (97,946) | (93,518) | (65,588) |
Property and equipment, net | 47,621 | 52,049 | 26,765 |
Vehicles [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, Gross | 115,135 | 115,135 | 74,755 |
Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, Gross | 6,097 | 6,097 | 5,000 |
Furniture and fixtures [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, Gross | $ 24,335 | $ 24,335 | $ 12,598 |
Intangible Assets (Schedule of
Intangible Assets (Schedule of Finite Lived Assets) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | |
Finite-lived assets: | |||
Cost | $ 1,633,941 | $ 3,241,845 | |
Accumulated Amortization | (278,138) | (605,530) | |
Net Book Value | 1,355,803 | 1,436,315 | |
Impairment | (2,000,287) | ||
Total | 1,355,803 | 1,436,315 | |
Customer List [Member] | |||
Finite-lived assets: | |||
Cost | 881,000 | 881,000 | |
Accumulated Amortization | (168,293) | (132,147) | |
Net Book Value | 712,707 | 748,853 | |
Impairment | |||
Total | 712,707 | 748,853 | |
Vendor relationships [Member] | |||
Finite-lived assets: | |||
Cost | 471,096 | 479,000 | |
Accumulated Amortization | (95,797) | (71,847) | |
Net Book Value | 375,299 | 407,153 | |
Impairment | |||
Total | 375,299 | 407,153 | |
Capitalized product development costs [Member] | |||
Finite-lived assets: | |||
Cost | 281,845 | 281,845 | |
Accumulated Amortization | (14,048) | (1,536) | |
Net Book Value | 267,797 | 280,309 | |
Impairment | |||
Total | 267,797 | 280,309 | |
Noncompete Agreement [Member] | |||
Finite-lived assets: | |||
Cost | 1,600,000 | ||
Accumulated Amortization | (400,000) | ||
Net Book Value | 1,200,000 | ||
Impairment | (1,200,000) | ||
Total | |||
Goodwill [Member] | |||
Finite-lived assets: | |||
Cost | 834,220 | 1,634,507 | |
Accumulated Amortization | |||
Net Book Value | 834,220 | 1,634,507 | |
Impairment | (800,287) | ||
Total | $ 834,220 | $ 834,220 |
Intangible Assets (Schedule o_2
Intangible Assets (Schedule of Amortization Expense) (Details) - USD ($) | Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 |
Period ending September 30, | |||
2021 | $ 347,293 | $ 347,293 | |
2022 | 353,660 | 353,660 | |
2023 | 361,577 | 361,577 | |
2024 | 276,383 | 290,432 | |
2025 | 16,890 | 288,890 | |
Total | $ 1,355,803 | $ 1,436,315 |
Line of Credit (Details)
Line of Credit (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | |
Line of Credit Facility [Abstract] | |||
Line of credit maximum borrowing capacity | $ 1,000,000 | $ 1,250,000 | |
Interest rate basis | prime plus 0.5% | prime plus 0.05% | |
Interest rate | 3.75% | 4.25% | 6.00% |
Debt maturity | Oct. 29, 2021 | Oct. 12, 2020 | |
Line of credit | $ 936,598 | ||
Minimum average bank balance | $ 50,000 | $ 50,000 | |
Percentage of curtailment of outstanding balance | 20.00% | ||
Number of common stock owned by two stockholders | 50,000,000 | 850,000 | |
Available credit line | $ 1,000,000 |
Notes Payable (Narrative) (Deta
Notes Payable (Narrative) (Details) - USD ($) | Jan. 09, 2020 | Dec. 11, 2019 | Aug. 06, 2019 | Apr. 01, 2019 | Aug. 18, 2020 | Jul. 24, 2020 | Jul. 20, 2020 | Jun. 26, 2020 | Mar. 25, 2020 | Jan. 27, 2020 | Nov. 25, 2019 | Nov. 18, 2019 | Aug. 29, 2019 | Jul. 20, 2019 | Jun. 18, 2019 | May 28, 2019 | Apr. 29, 2019 | Mar. 28, 2019 | Feb. 22, 2019 | Jan. 16, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 |
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes Payable | $ 1,030,079 | |||||||||||||||||||||||
Interest rate | 3.75% | 4.25% | 6.00% | |||||||||||||||||||||
Debt maturity | Oct. 29, 2021 | |||||||||||||||||||||||
Interest expense | $ 3,863,856 | |||||||||||||||||||||||
Interest accretion | $ 399,936 | $ 228,933 | $ 1,825,506 | $ 644,055 | ||||||||||||||||||||
Unexercised warrants outstanding | $ 204,771,864 | |||||||||||||||||||||||
Unexercised warrants price per share | $ 4 | $ 4 | ||||||||||||||||||||||
Expiration period | 36 months | 36 months | ||||||||||||||||||||||
Exercise price | $ 4 | $ 4 | ||||||||||||||||||||||
Outstanding warrants expired | between November 29, 2021 and November 18, 2022 | between November 29, 2021 and November 18, 2022 | ||||||||||||||||||||||
Convertible Notes Payable one [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes Payable | $ 200,000 | |||||||||||||||||||||||
Amounts withdraw | $ 56,250 | |||||||||||||||||||||||
Debt discount | $ 20,000 | |||||||||||||||||||||||
Interest rate | 5.00% | |||||||||||||||||||||||
Debt maturity | Mar. 31, 2020 | |||||||||||||||||||||||
Percentage of lowest traded price | 70.00% | |||||||||||||||||||||||
Conversion price | $ 3 | |||||||||||||||||||||||
Convertible Notes Payable Two [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Amounts withdraw | $ 112,500 | |||||||||||||||||||||||
Debt maturity | Jun. 30, 2020 | |||||||||||||||||||||||
Convertible Notes Payable Three [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes Payable | $ 225,000 | $ 225,000 | ||||||||||||||||||||||
Amounts withdraw | 56,250 | |||||||||||||||||||||||
Debt discount | $ 25,000 | $ 20,000 | ||||||||||||||||||||||
Interest rate | 10.00% | 10.00% | ||||||||||||||||||||||
Debt maturity | Apr. 30, 2020 | Nov. 30, 2020 | ||||||||||||||||||||||
Initial draw borrowed | $ 100,000 | |||||||||||||||||||||||
Percentage of lowest traded price | 70.00% | 70.00% | ||||||||||||||||||||||
Conversion price | $ 3 | |||||||||||||||||||||||
Convertible Notes Payable Three [Member] | Minimum [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Prepayment penalties, percentage | 110.00% | 110.00% | ||||||||||||||||||||||
Convertible Notes Payable Three [Member] | Maximum [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Prepayment penalties, percentage | 125.00% | 125.00% | ||||||||||||||||||||||
Convertible Notes Payable Four [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes Payable | $ 1,325,000 | |||||||||||||||||||||||
Debt discount | $ 92,750 | |||||||||||||||||||||||
Interest rate | 8.00% | |||||||||||||||||||||||
Debt maturity | Apr. 30, 2020 | |||||||||||||||||||||||
Prepayment penalties, percentage | 120.00% | |||||||||||||||||||||||
Percentage of lowest traded price | 75.00% | |||||||||||||||||||||||
Conversion price | $ 2.75 | |||||||||||||||||||||||
Convertible Notes Payable Five [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes Payable | $ 322,580 | |||||||||||||||||||||||
Debt discount | $ 22,580 | |||||||||||||||||||||||
Interest rate | 8.00% | |||||||||||||||||||||||
Debt maturity | May 31, 2020 | |||||||||||||||||||||||
Prepayment penalties, percentage | 120.00% | |||||||||||||||||||||||
Percentage of lowest traded price | 75.00% | |||||||||||||||||||||||
Conversion price | $ 2.75 | |||||||||||||||||||||||
Convertible Notes Payable Six [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes Payable | $ 366,120 | |||||||||||||||||||||||
Debt discount | $ 27,120 | |||||||||||||||||||||||
Interest rate | 8.00% | |||||||||||||||||||||||
Debt maturity | May 31, 2020 | |||||||||||||||||||||||
Prepayment penalties, percentage | 120.00% | |||||||||||||||||||||||
Percentage of lowest traded price | 75.00% | |||||||||||||||||||||||
Convertible Notes Payable Nine [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes Payable | $ 220,000 | $ 134,375 | ||||||||||||||||||||||
Debt discount | $ 20,000 | $ 9,375 | ||||||||||||||||||||||
Interest rate | 12.00% | 8.00% | ||||||||||||||||||||||
Debt maturity | Aug. 31, 2020 | Jul. 31, 2021 | ||||||||||||||||||||||
Prepayment penalties, percentage | 120.00% | |||||||||||||||||||||||
Percentage of lowest traded price | 75.00% | 70.00% | ||||||||||||||||||||||
Conversion price | $ 0.47 | |||||||||||||||||||||||
Exercise price | $ 0.01 | |||||||||||||||||||||||
Convertible Notes Payable Nine [Member] | Minimum [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Prepayment penalties, percentage | 120.00% | |||||||||||||||||||||||
Convertible Notes Payable Nine [Member] | Maximum [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Prepayment penalties, percentage | 130.00% | |||||||||||||||||||||||
Convertible Notes Payable Ten [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes Payable | $ 168,300 | $ 234,726 | ||||||||||||||||||||||
Debt discount | $ 15,300 | $ 16,376 | ||||||||||||||||||||||
Interest rate | 12.00% | 8.00% | ||||||||||||||||||||||
Debt maturity | Jul. 31, 2021 | Aug. 31, 2020 | ||||||||||||||||||||||
Prepayment penalties, percentage | 120.00% | |||||||||||||||||||||||
Percentage of lowest traded price | 71.00% | 75.00% | ||||||||||||||||||||||
Convertible Notes Payable Ten [Member] | Minimum [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Prepayment penalties, percentage | 110.00% | |||||||||||||||||||||||
Convertible Notes Payable Ten [Member] | Maximum [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Prepayment penalties, percentage | 125.00% | |||||||||||||||||||||||
Convertible Notes Payable Twelve [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes Payable | $ 55,000 | |||||||||||||||||||||||
Debt discount | $ 5,000 | |||||||||||||||||||||||
Interest rate | 8.00% | |||||||||||||||||||||||
Debt maturity | Nov. 30, 2020 | |||||||||||||||||||||||
Percentage of lowest traded price | 70.00% | |||||||||||||||||||||||
Percentage of lowest traded price before issue date | 70.00% | |||||||||||||||||||||||
Convertible Notes Payable Twelve [Member] | Minimum [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Prepayment penalties, percentage | 115.00% | |||||||||||||||||||||||
Convertible Notes Payable Twelve [Member] | Maximum [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Prepayment penalties, percentage | 125.00% | |||||||||||||||||||||||
Convertible Notes Payable Thirteen [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes Payable | $ 110,000 | |||||||||||||||||||||||
Debt discount | $ 10,000 | |||||||||||||||||||||||
Interest rate | 8.00% | |||||||||||||||||||||||
Debt maturity | Nov. 30, 2020 | |||||||||||||||||||||||
Percentage of lowest traded price | 70.00% | |||||||||||||||||||||||
Percentage of lowest traded price before issue date | 70.00% | |||||||||||||||||||||||
Convertible Notes Payable Thirteen [Member] | Minimum [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Prepayment penalties, percentage | 115.00% | |||||||||||||||||||||||
Convertible Notes Payable Thirteen [Member] | Maximum [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Prepayment penalties, percentage | 125.00% | |||||||||||||||||||||||
Convertible Notes Payable Fourteen [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes Payable | $ 220,430 | |||||||||||||||||||||||
Debt discount | $ 15,430 | |||||||||||||||||||||||
Interest rate | 8.00% | |||||||||||||||||||||||
Debt maturity | Dec. 31, 2020 | |||||||||||||||||||||||
Percentage of lowest traded price | 75.00% | |||||||||||||||||||||||
Conversion price | $ 0.46 | |||||||||||||||||||||||
Convertible Notes Payable Fourteen [Member] | Minimum [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Prepayment penalties, percentage | 120.00% | |||||||||||||||||||||||
Convertible Notes Payable Fourteen [Member] | Maximum [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Prepayment penalties, percentage | 130.00% | |||||||||||||||||||||||
Convertible Notes Payable Fifteen [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes Payable | $ 1,000,000 | |||||||||||||||||||||||
Debt discount | $ 70,000 | |||||||||||||||||||||||
Interest rate | 8.00% | |||||||||||||||||||||||
Debt maturity | Nov. 30, 2020 | |||||||||||||||||||||||
Percentage of lowest traded price | 75.00% | |||||||||||||||||||||||
Conversion price | $ 0.46 | |||||||||||||||||||||||
Percentage of redemption premium | 115.00% | |||||||||||||||||||||||
Convertible Notes Payable Fifteen [Member] | Maximum [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes payable principal and interest | $ 250,000 | |||||||||||||||||||||||
Convertible Notes Payable Sixteen [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes Payable | $ 225,000 | |||||||||||||||||||||||
Debt discount | $ 13,500 | |||||||||||||||||||||||
Interest rate | 8.00% | |||||||||||||||||||||||
Debt maturity | Oct. 31, 2020 | |||||||||||||||||||||||
Percentage of lowest traded price | 75.00% | |||||||||||||||||||||||
Amount of note increased | $ 25,000 | |||||||||||||||||||||||
Convertible Notes Payable Sixteen [Member] | Minimum [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Prepayment penalties, percentage | 110.00% | |||||||||||||||||||||||
Convertible Notes Payable Sixteen [Member] | Maximum [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Prepayment penalties, percentage | 125.00% | |||||||||||||||||||||||
Convertible Notes Payable Seventeen [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes Payable | $ 223,300 | |||||||||||||||||||||||
Debt discount | $ 20,300 | |||||||||||||||||||||||
Interest rate | 8.00% | |||||||||||||||||||||||
Debt maturity | Jan. 31, 2021 | |||||||||||||||||||||||
Percentage of lowest traded price | 75.00% | |||||||||||||||||||||||
Convertible Notes Payable Seventeen [Member] | Minimum [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Prepayment penalties, percentage | 110.00% | |||||||||||||||||||||||
Convertible Notes Payable Seventeen [Member] | Maximum [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Prepayment penalties, percentage | 125.00% | |||||||||||||||||||||||
Convertible Notes Payable Eighteen [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes Payable | $ 430,000 | $ 338,625 | ||||||||||||||||||||||
Debt discount | $ 30,000 | $ 23,625 | ||||||||||||||||||||||
Interest rate | 8.00% | 8.00% | ||||||||||||||||||||||
Debt maturity | Jun. 30, 2021 | Mar. 31, 2021 | ||||||||||||||||||||||
Percentage of lowest traded price | 70.00% | 75.00% | ||||||||||||||||||||||
Conversion price | $ 0.47 | $ 0.46 | ||||||||||||||||||||||
Convertible Notes Payable Eighteen [Member] | Minimum [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Prepayment penalties, percentage | 120.00% | 120.00% | ||||||||||||||||||||||
Convertible Notes Payable Eighteen [Member] | Maximum [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Prepayment penalties, percentage | 130.00% | 130.00% | ||||||||||||||||||||||
Convertible Notes Payable [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Interest expense | $ 34,250 | 60,268 | $ 340,526 | 89,279 | ||||||||||||||||||||
Interest accretion | $ 399,936 | $ 228,933 | ||||||||||||||||||||||
Prepayment penalties | 139,000 | $ 134,461 | ||||||||||||||||||||||
Notes Payable [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Monthly installment | $ 697 | |||||||||||||||||||||||
Interest rate | 4.00% | 3.00% | 4.00% | |||||||||||||||||||||
Debt maturity | Jun. 26, 2021 | Jun. 26, 2021 | ||||||||||||||||||||||
Notes Payable One [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Monthly installment | $ 13,137 | $ 13,137 | ||||||||||||||||||||||
Interest rate | 0.98% | 0.98% | ||||||||||||||||||||||
Debt maturity | Apr. 30, 2022 | Apr. 30, 2022 | ||||||||||||||||||||||
Notes Payable Two [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Monthly installment | $ 731 | $ 731 | ||||||||||||||||||||||
Interest rate | 3.75% | 3.75% | ||||||||||||||||||||||
Debt maturity | May 31, 2050 | May 31, 2050 | ||||||||||||||||||||||
Notes Payable Three [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Monthly installment | $ 12,449 | $ 19,173 | ||||||||||||||||||||||
Debt term | 2 years | |||||||||||||||||||||||
Debt maturity | Jul. 31, 2022 | Jul. 31, 2022 | ||||||||||||||||||||||
Notes Payable Three [Member] | Minimum [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Monthly installment | $ 1,083 | $ 1,083 | ||||||||||||||||||||||
Notes Payable Three [Member] | Maximum [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Monthly installment | 3,524 | 4,806 | ||||||||||||||||||||||
Notes Payable Four [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Monthly installment | $ 813 | $ 813 | ||||||||||||||||||||||
Debt term | 5 years | 5 years | ||||||||||||||||||||||
Debt maturity | Jul. 31, 2020 | Jul. 31, 2020 | ||||||||||||||||||||||
Notes Payable Four [Member] | Minimum [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Monthly installment | $ 352 | |||||||||||||||||||||||
Interest rate | 4.50% | |||||||||||||||||||||||
Notes Payable Four [Member] | Maximum [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Monthly installment | $ 461 | |||||||||||||||||||||||
Interest rate | 4.75% | |||||||||||||||||||||||
Notes Payable Five [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Monthly installment | $ 679 | $ 679 | ||||||||||||||||||||||
Debt term | 6 years | 6 years | ||||||||||||||||||||||
Interest rate | 8.99% | 8.99% | ||||||||||||||||||||||
Debt maturity | Dec. 31, 2025 | Dec. 31, 2025 | ||||||||||||||||||||||
Convertible Notes Payable Seven [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes Payable | $ 125,000 | |||||||||||||||||||||||
Debt discount | $ 8,750 | |||||||||||||||||||||||
Interest rate | 8.00% | |||||||||||||||||||||||
Debt maturity | Jul. 31, 2021 | |||||||||||||||||||||||
Percentage of lowest traded price | 80.00% | |||||||||||||||||||||||
Conversion price | $ 0.47 | |||||||||||||||||||||||
Percentage of redemption premium | 115.00% | |||||||||||||||||||||||
Convertible Notes Payable Eight [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes Payable | $ 500,000 | |||||||||||||||||||||||
Debt discount | $ 35,000 | |||||||||||||||||||||||
Interest rate | 8.00% | |||||||||||||||||||||||
Debt maturity | Oct. 31, 2021 | |||||||||||||||||||||||
Percentage of lowest traded price | 80.00% | |||||||||||||||||||||||
Conversion price | $ 0.47 | |||||||||||||||||||||||
Percentage of redemption premium | 115.00% | |||||||||||||||||||||||
Investor [Member] | Convertible Notes Payable Two [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Share Issued | 25,000 | |||||||||||||||||||||||
Investor [Member] | Convertible Notes Payable Three [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Share Issued | 25,000 | |||||||||||||||||||||||
Convertible Notes Payable [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Notes Payable | $ 382,000 | |||||||||||||||||||||||
Debt discount | $ 38,200 | |||||||||||||||||||||||
Interest rate | 12.00% | |||||||||||||||||||||||
Debt maturity | Jul. 31, 2019 | |||||||||||||||||||||||
Percentage of lowest traded price | 70.00% | |||||||||||||||||||||||
Conversion price | $ 3 | |||||||||||||||||||||||
Convertible Notes Payable [Member] | Investor [Member] | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Share Issued | 92,271 |
Notes Payable (Schedule of long
Notes Payable (Schedule of long-term Notes Payable) (Details) - USD ($) | Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 |
Debt Instrument [Line Items] | |||
Total Notes Payable | $ 1,018,576 | $ 994,978 | $ 280,953 |
Current Portion of Notes Payable | 570,962 | 512,425 | 279,346 |
Long-term Portion of Notes Payable | 447,614 | 482,553 | 1,607 |
Notes Payable [Member] | |||
Debt Instrument [Line Items] | |||
Total Notes Payable | 275,200 | 274,900 | 274,900 |
Notes Payable One [Member] | |||
Debt Instrument [Line Items] | |||
Total Notes Payable | 310,832 | 310,832 | |
Notes Payable Two [Member] | |||
Debt Instrument [Line Items] | |||
Total Notes Payable | 150,000 | 150,000 | |
Notes Payable Three [Member] | |||
Debt Instrument [Line Items] | |||
Total Notes Payable | 249,299 | 223,982 | |
Notes Payable Four [Member] | |||
Debt Instrument [Line Items] | |||
Total Notes Payable | 1,245 | 6,053 | |
Notes Payable Five [Member] | |||
Debt Instrument [Line Items] | |||
Total Notes Payable | $ 33,245 | $ 34,019 |
Notes Payable (Schedule of Futu
Notes Payable (Schedule of Future minimum principal payments on the non-related party long term notes payable) (Details) - USD ($) | Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 |
Debt Disclosure [Abstract] | |||
2021 | $ 570,962 | $ 512,425 | |
2022 | 247,194 | 229,962 | |
2023 | 42,191 | 93,555 | |
2024 | 10,230 | 10,045 | |
2025 | 13,017 | 10,807 | |
Thereafter | 134,982 | 138,184 | |
Long-term Debt | $ 1,018,576 | $ 994,978 | $ 280,953 |
Notes Payable (Schedule of Conv
Notes Payable (Schedule of Convertible Notes Payable) (Details) - USD ($) | Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 |
Debt Instrument [Line Items] | |||
Total Convertible Notes Payable | $ 1,133,140 | $ 1,989,975 | $ 2,876,950 |
Less: Unamortized original issue discounts | 888,075 | 752,126 | |
Less: Unamortized original issue discounts | 455,594 | ||
Current Portion of Convertible Notes Payable | 677,546 | 1,101,900 | 2,124,824 |
Long-term Portion of Convertible Notes Payable | |||
Convertible Notes Payable [Member] | |||
Debt Instrument [Line Items] | |||
Total Convertible Notes Payable | 382,000 | ||
Convertible Notes Payable one [Member] | |||
Debt Instrument [Line Items] | |||
Total Convertible Notes Payable | 200,000 | ||
Convertible Notes Payable Two [Member] | |||
Debt Instrument [Line Items] | |||
Total Convertible Notes Payable | 24,150 | 168,750 | |
Convertible Notes Payable Three [Member] | |||
Debt Instrument [Line Items] | |||
Total Convertible Notes Payable | 112,500 | ||
Convertible Notes Payable Four [Member] | |||
Debt Instrument [Line Items] | |||
Total Convertible Notes Payable | 1,325,000 | ||
Convertible Notes Payable Five [Member] | |||
Debt Instrument [Line Items] | |||
Total Convertible Notes Payable | 75,465 | 322,580 | |
Convertible Notes Payable Six [Member] | |||
Debt Instrument [Line Items] | |||
Total Convertible Notes Payable | 430,000 | 366,120 | |
Convertible Notes Payable Seven [Member] | |||
Debt Instrument [Line Items] | |||
Total Convertible Notes Payable | |||
Convertible Notes Payable Eight [Member] | |||
Debt Instrument [Line Items] | |||
Total Convertible Notes Payable | 325,000 | ||
Convertible Notes Payable Nine [Member] | |||
Debt Instrument [Line Items] | |||
Total Convertible Notes Payable | 134,375 | ||
Convertible Notes Payable Ten [Member] | |||
Debt Instrument [Line Items] | |||
Total Convertible Notes Payable | $ 168,300 | 1,000 | |
Convertible Notes Payable Eleven [Member] | |||
Debt Instrument [Line Items] | |||
Total Convertible Notes Payable | 121,200 | ||
Convertible Notes Payable Twelve [Member] | |||
Debt Instrument [Line Items] | |||
Total Convertible Notes Payable | 825,000 | ||
Convertible Notes Payable Thirteen [Member] | |||
Debt Instrument [Line Items] | |||
Total Convertible Notes Payable | 250,000 | ||
Convertible Notes Payable Fourteen [Member] | |||
Debt Instrument [Line Items] | |||
Total Convertible Notes Payable | |||
Convertible Notes Payable Fifteen [Member] | |||
Debt Instrument [Line Items] | |||
Total Convertible Notes Payable | 338,625 | ||
Convertible Notes Payable Sixteen [Member] | |||
Debt Instrument [Line Items] | |||
Total Convertible Notes Payable | $ 430,000 |
Fair Value Measurements (Schedu
Fair Value Measurements (Schedule of Fair Values Determined by Level 3 Inputs) (Details) - USD ($) | Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 |
Liabilities: | |||
Derivative liability, warrants | $ 2,000,000 | ||
Recurring [Member] | |||
Liabilities: | |||
Original issue discount, convertible debt | $ 1,276,312 | 213,300 | $ 979,569 |
Derivative liability, warrants | 33,312 | 46,375 | |
Total: | 246,612 | 1,025,944 | |
Recurring [Member] | Level 1 [Member] | |||
Liabilities: | |||
Original issue discount, convertible debt | |||
Derivative liability, warrants | |||
Total: | |||
Recurring [Member] | Level 2 [Member] | |||
Liabilities: | |||
Original issue discount, convertible debt | |||
Derivative liability, warrants | |||
Total: | |||
Recurring [Member] | Level 3 [Member] | |||
Liabilities: | |||
Original issue discount, convertible debt | 1,276,312 | 213,300 | 979,569 |
Derivative liability, warrants | 33,312 | 46,375 | |
Total: | 246,612 | $ 1,025,944 | |
Nonrecurring [Member] | |||
Assets: | |||
Assets measured at fair value on a nonrecurring basis | 1,355,803 | 1,990,226 | |
Nonrecurring [Member] | Customer list [Member] | |||
Assets: | |||
Assets measured at fair value on a nonrecurring basis | 704,803 | 748,853 | |
Nonrecurring [Member] | Vendor relationships [Member] | |||
Assets: | |||
Assets measured at fair value on a nonrecurring basis | 383,203 | 407,153 | |
Nonrecurring [Member] | Development costs [Member] | |||
Assets: | |||
Assets measured at fair value on a nonrecurring basis | 287,797 | 280,315 | |
Nonrecurring [Member] | Goodwill [Member] | |||
Assets: | |||
Assets measured at fair value on a nonrecurring basis | 834,220 | ||
Nonrecurring [Member] | Level 1 [Member] | |||
Assets: | |||
Assets measured at fair value on a nonrecurring basis | |||
Nonrecurring [Member] | Level 1 [Member] | Customer list [Member] | |||
Assets: | |||
Assets measured at fair value on a nonrecurring basis | |||
Nonrecurring [Member] | Level 1 [Member] | Vendor relationships [Member] | |||
Assets: | |||
Assets measured at fair value on a nonrecurring basis | |||
Nonrecurring [Member] | Level 1 [Member] | Development costs [Member] | |||
Assets: | |||
Assets measured at fair value on a nonrecurring basis | |||
Nonrecurring [Member] | Level 1 [Member] | Goodwill [Member] | |||
Assets: | |||
Assets measured at fair value on a nonrecurring basis | |||
Nonrecurring [Member] | Level 2 [Member] | |||
Assets: | |||
Assets measured at fair value on a nonrecurring basis | |||
Nonrecurring [Member] | Level 2 [Member] | Customer list [Member] | |||
Assets: | |||
Assets measured at fair value on a nonrecurring basis | |||
Nonrecurring [Member] | Level 2 [Member] | Vendor relationships [Member] | |||
Assets: | |||
Assets measured at fair value on a nonrecurring basis | |||
Nonrecurring [Member] | Level 2 [Member] | Development costs [Member] | |||
Assets: | |||
Assets measured at fair value on a nonrecurring basis | |||
Nonrecurring [Member] | Level 2 [Member] | Goodwill [Member] | |||
Assets: | |||
Assets measured at fair value on a nonrecurring basis | |||
Nonrecurring [Member] | Level 3 [Member] | |||
Assets: | |||
Assets measured at fair value on a nonrecurring basis | 1,355,803 | 1,990,226 | |
Nonrecurring [Member] | Level 3 [Member] | Customer list [Member] | |||
Assets: | |||
Assets measured at fair value on a nonrecurring basis | 704,803 | 748,853 | |
Nonrecurring [Member] | Level 3 [Member] | Vendor relationships [Member] | |||
Assets: | |||
Assets measured at fair value on a nonrecurring basis | 383,203 | 407,153 | |
Nonrecurring [Member] | Level 3 [Member] | Development costs [Member] | |||
Assets: | |||
Assets measured at fair value on a nonrecurring basis | $ 287,797 | 280,315 | |
Nonrecurring [Member] | Level 3 [Member] | Goodwill [Member] | |||
Assets: | |||
Assets measured at fair value on a nonrecurring basis | $ 834,220 |
Fair Value Measurements (Sche_2
Fair Value Measurements (Schedule of Derivative Liability Valued Using Monte Carlo Pricing Model) (Details) | 3 Months Ended | 12 Months Ended | |
Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | |
Risk-free interest rate [Member] | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Derivative Liability Valued Using Monte Carlo Pricing Model | 0.08% | 0.09% | 1.72 -2.83% |
Expected dividend yield [Member] | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Derivative Liability Valued Using Monte Carlo Pricing Model | 0.00% | 0.00% | 0.00% |
Expected stock price volatility [Member] | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Derivative Liability Valued Using Monte Carlo Pricing Model | 325.00% | 300.00% | 180.00% |
Expected option life in years [Member] | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Derivative Liability Valued Using Monte Carlo Pricing Model | 0.48 to 1.44 years | .089 to 1.69 years | 2.80 -3.00 years |
Fair Value Measurements (Sche_3
Fair Value Measurements (Schedule of Reconciliation of Changes in Fair Value of Convertible Debt) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Beginning balance | $ 246,612 | $ 1,025,944 | |
Settlement of conversion features and warrants | $ 301,575 | ||
Ending balance | 1,276,312 | 246,612 | 1,025,944 |
Level 3 [Member] | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Beginning balance | 246,612 | 1,025,944 | |
Convertible Securities at inception | 2,000 | 2,027,000 | 1,238,359 |
Settlement of conversion features and warrants | (152,374) | (301,613) | |
Realized | (5,300) | (240,903) | (83,487) |
Unrealized | 1,033,000 | (2,413,055) | 172,685 |
Ending balance | $ 1,276,312 | $ 246,612 | $ 1,025,944 |
Related Party Transactions (Nar
Related Party Transactions (Narrative) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Related Party Transaction [Line Items] | ||||
Notes payable | $ 1,484,473 | $ 1,484,473 | ||
Interest rate | 3.75% | 4.25% | 6.00% | |
Debt maturity | Oct. 29, 2021 | |||
Collateral fee | $ 7,500 | $ 7,500 | ||
Lease Expired | Dec. 31, 2021 | Dec. 31, 2021 | ||
Operating Leases, Rent Expense | $ 4,500 | $ 4,500 | $ 18,000 | $ 9,000 |
Monthly lease payment | 1,500 | |||
Short term commercial deposit | 274,900 | 274,900 | ||
Long-term Note Payable to Related Party - 1 [Member] | ||||
Related Party Transaction [Line Items] | ||||
Interest payable | 10,000 | 10,000 | ||
Notes payable | $ 200,000 | $ 200,000 | ||
Interest rate | 6.00% | 6.00% | ||
Debt maturity | Nov. 30, 2021 | Nov. 30, 2021 | ||
Long-term Note Payable to Related Party - 1 [Member] | Notes Payable Increased [Member] | ||||
Related Party Transaction [Line Items] | ||||
Notes payable | $ 400,000 | |||
Long-term Note Payable to Related Party - 1 [Member] | Series D Preferred Stock [Member] | ||||
Related Party Transaction [Line Items] | ||||
Conversion of shares | 400,000 | 400,000 | ||
Unsecured note payble [Member] | ||||
Related Party Transaction [Line Items] | ||||
Interest rate | 3.00% | 3.00% | ||
Debt maturity | Nov. 30, 2021 | Nov. 30, 2021 | ||
Long-term Note Payable to Related Party - 3 [Member] | ||||
Related Party Transaction [Line Items] | ||||
Notes payable | $ 1,225,000 | $ 225,000 | ||
Interest rate | 6.00% | 6.00% | ||
Debt maturity | Mar. 31, 2022 | Mar. 31, 2022 | ||
Long-term Note Payable to Related Party - 3 [Member] | Series D Preferred Stock [Member] | ||||
Related Party Transaction [Line Items] | ||||
Conversion of shares | 1,000,000 | 1,000,000 | ||
Long-term Note Payable to Related Party - 4 [Member] | ||||
Related Party Transaction [Line Items] | ||||
Interest rate | 6.00% | 6.00% | ||
Debt maturity | Nov. 30, 2021 | Nov. 30, 2021 | ||
Long-term Note Payable to Related Party - 4 [Member] | Series D Preferred Stock [Member] | ||||
Related Party Transaction [Line Items] | ||||
Conversion of shares | 200,000 | 200,000 | ||
Long-term Note Payable to Related Party - 5 [Member] | ||||
Related Party Transaction [Line Items] | ||||
Interest rate | 10.00% | 10.00% | ||
Debt maturity | Aug. 20, 2020 |
Related Party Transactions (Sch
Related Party Transactions (Schedule of Notes Payable Obligations to Related Parties Assumed in Acquisition) (Details) - USD ($) | Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 |
Related Party Transaction [Line Items] | |||
Other short term payables due to stockholders and related parties | $ 74,323 | $ 107,733 | |
Total Related Party Notes Payable and Other Payables | 3,314,402 | 3,347,812 | 200,000 |
Current Portion of Related Party Notes Payable and Other Payables | 1,239,402 | 1,272,812 | 200,000 |
Long-term Portion of Related Party Notes Payable and Other Payables | 2,075,000 | 2,075,000 | |
Long-term Note Payable to Related Party - 1 [Member] | |||
Related Party Transaction [Line Items] | |||
Total Related Party Notes Payable and Other Payables | 400,000 | 400,000 | 200,000 |
Long-term Note Payable to Related Party - 2 [Member] | |||
Related Party Transaction [Line Items] | |||
Total Related Party Notes Payable and Other Payables | 1,030,079 | 1,030,079 | |
Long-term Note Payable to Related Party - 3 [Member] | |||
Related Party Transaction [Line Items] | |||
Total Related Party Notes Payable and Other Payables | 1,225,000 | 1,225,000 | |
Long-term Note Payable to Related Party - 4 [Member] | |||
Related Party Transaction [Line Items] | |||
Total Related Party Notes Payable and Other Payables | 200,000 | 200,000 | |
Long-term Note Payable to Related Party - 5 [Member] | |||
Related Party Transaction [Line Items] | |||
Total Related Party Notes Payable and Other Payables | $ 385,000 | $ 385,000 |
Related Party Transactions (S_2
Related Party Transactions (Schedule of Future Maturities of Notes Payable) (Details) - USD ($) | Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 |
Related Party Transaction [Line Items] | |||
2021 | $ 570,962 | $ 512,425 | |
2022 | 247,194 | 229,962 | |
Related Party Notes Payable | 3,314,402 | $ 3,347,812 | $ 200,000 |
Notes payable [Member] | |||
Related Party Transaction [Line Items] | |||
2021 | 1,239,402 | ||
2022 | 2,075,000 | ||
Related Party Notes Payable | $ 3,314,402 |
Lease Agreements (Narrative) (D
Lease Agreements (Narrative) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | |
Notes Payable | $ 1,030,079 | ||
Interest rate | 3.75% | 4.25% | 6.00% |
Debt maturity | Oct. 29, 2021 | ||
Monthly lease payment | $ 1,500 | ||
Weighted average remaining lease term | 1 year 8 months 2 days | 1 year 8 months 12 days | |
Financial Institution [Member] | |||
Notes Payable | $ 813 | ||
Debt maturity | Jul. 31, 2020 | ||
Monthly lease payment | $ 12,449 | ||
Lease term | 2 years | 5 years | |
Lease expiration date | Jul. 31, 2022 | ||
Financial Institution [Member] | Financing lease [Member] | |||
Monthly lease payment | $ 19,173 | ||
Lease term | 2 years | ||
Lease expiration date | Jul. 31, 2022 | ||
Financial Institution [Member] | Minimum [Member] | |||
Notes Payable | $ 263 | ||
Interest rate | 0.00% | 4.50% | |
Monthly lease payment | $ 1,083 | ||
Financial Institution [Member] | Minimum [Member] | Financing lease [Member] | |||
Monthly lease payment | $ 1,083 | ||
Financial Institution [Member] | Maximum [Member] | |||
Notes Payable | $ 461 | ||
Interest rate | 2.00% | 4.75% | |
Monthly lease payment | $ 3,524 | ||
Lease term | 3 years | ||
Financial Institution [Member] | Maximum [Member] | Financing lease [Member] | |||
Monthly lease payment | $ 4,806 |
Lease Agreements (Schedule of O
Lease Agreements (Schedule of Operating Lease Right-of-Use Assets and Operating Lease Liabilities) (Details) - USD ($) | Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 |
Right of use assets | |||
Operating right of use assets | $ 249,299 | $ 223,982 | |
Operating lease liabilities | |||
Current portion of long term notes payable | 135,099 | ||
Financing leases payable, less current portion | 114,200 | ||
Total operating lease liabilities | $ 249,299 | ||
Notes Payable Current [Member] | |||
Operating lease liabilities | |||
Current portion of long term notes payable | 114,288 | ||
Notes Payable Noncurrent [Member] | |||
Operating lease liabilities | |||
Current portion of long term notes payable | 109,694 | ||
Notes Payable [Member] | |||
Operating lease liabilities | |||
Total operating lease liabilities | $ 223,982 |
Lease Agreements (Schedule of_2
Lease Agreements (Schedule of Operating Leases) (Details) | Jun. 30, 2020USD ($) |
Leases [Abstract] | |
2021 | $ 114,288 |
2022 | 109,694 |
Total lease payments | $ 223,982 |
Lease Agreements (Schedule of_3
Lease Agreements (Schedule of Operating Leases 1) (Details) | Sep. 30, 2020USD ($) |
Leases [Abstract] | |
2021 | $ 135,099 |
2022 | 81,523 |
2022 | 32,677 |
Total operating lease payments | $ 249,299 |
Equity (Details)
Equity (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||
Sep. 30, 2020 | Jun. 30, 2020 | Sep. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Class of Stock [Line Items] | |||||
Proceeds from shares issuance | $ 2,316,520 | $ 637,000 | |||
Share issued value | 637,000 | ||||
Consideration amount | 525,000 | 302,271 | |||
Repayment of convertible note | $ 873,003 | ||||
Shares repurchased during period | 38,625 | ||||
Shares cancelled during period | 0 | 60,000 | |||
Convertible Notes Payable | $ 1,133,140 | $ 1,989,975 | $ 1,989,975 | $ 2,876,950 | |
Preferred Class E [Member] | |||||
Class of Stock [Line Items] | |||||
Share Issued | 500,000 | ||||
Convertible Notes Payable | $ 1,190,476 | $ 1,190,476 | |||
Stock Plan [Member] | |||||
Class of Stock [Line Items] | |||||
Shares awarded under stock plan | 98,857,857 | 965,000 | 642,857 | 706,618 | |
Consulting Services [Member] | |||||
Class of Stock [Line Items] | |||||
Share Issued | 103,750,000 | 7,619,912 | 346,618 | ||
Share issued value | $ 2,763,000 | $ 2,020,150 | $ 800,751 | ||
Investor [Member] | |||||
Class of Stock [Line Items] | |||||
Warrant exercised | 32,052,654 | 32,052,654 | 381,944 | ||
Debt reduction [Member] | |||||
Class of Stock [Line Items] | |||||
Common shares issued for debt reduction | 968,475,442 | ||||
Common shares issued for debt reduction value | $ 7,974,206 | ||||
Warrant holders [Member] | |||||
Class of Stock [Line Items] | |||||
Share Issued | 249,792,217 | ||||
Shares Issued Stock Purchase Agreement [Member] | |||||
Class of Stock [Line Items] | |||||
Share Issued | 242,000,000 | ||||
Share issued value | $ 3,951,900 | ||||
Commitment shares under two year purchase agreement with an investor [Member] | |||||
Class of Stock [Line Items] | |||||
Share Issued | 2,500,000 | ||||
Share issued value | $ 55,000 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) | 12 Months Ended |
Jun. 30, 2020 | |
Minimum [Member] | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards expiration date | Jun. 30, 2020 |
Maximum [Member] | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards expiration date | Jun. 30, 2037 |
Income Taxes (Schedule of Effec
Income Taxes (Schedule of Effective Tax Rate Differed from Federal Statutory Income Tax Rate) (Details) | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Income Tax Disclosure [Abstract] | ||||
Federal statutory rate | 21.00% | 21.00% | 21.00% | 21.00% |
State tax, net of federal tax effect | 5.31% | 5.31% | 5.31% | 5.31% |
Valuation allowance | (26.00%) | (26.00%) | (26.00%) | (26.00%) |
Effective tax rate | 0.00% | 0.00% | 0.00% | 0.00% |
Income Taxes (Schedule of Defer
Income Taxes (Schedule of Deferred Tax Assets and Liabilities) (Details) - USD ($) | Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 |
Less valuation allowance | $ (9,143,000) | $ (6,116,000) | $ (3,846,400) |
Net Deferred Tax Assets | |||
Federal [Member] | |||
Deferred tax assets | 7,216,100 | 4,825,100 | 2,980,100 |
Less valuation allowance | (7,216,100) | (4,825,100) | (2,980,100) |
Deferred tax liabilities | |||
Net Deferred Tax Assets | |||
State [Member] | |||
Deferred tax assets | 1,926,900 | 1,290,900 | 866,300 |
Less valuation allowance | (1,926,900) | (1,290,900) | (866,300) |
Deferred tax liabilities | |||
Net Deferred Tax Assets |
Income Taxes (Schedule of Signi
Income Taxes (Schedule of Significant Components of Deferred Tax Assets) (Details) - USD ($) | Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 |
Income Tax Disclosure [Abstract] | |||
Net operating loss carryforwards | $ 8,681,800 | $ 5,767,000 | $ 3,826,100 |
Valuation allowance | (9,143,000) | (6,116,000) | (3,846,400) |
Property and equipment | (10,200) | (10,500) | (7,100) |
Goodwill | 273,600 | 278,900 | |
Intangible assets | 153,000 | 35,800 | |
Inventory allowance | 17,800 | 17,800 | 5,400 |
Warranty accrual and other | 27,000 | 27,000 | 22,000 |
Net Deferred Tax Assets |
Commitments, Contingencies, a_2
Commitments, Contingencies, and Concentrations (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||
Sep. 30, 2020 | Sep. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Aug. 14, 2020 | Sep. 04, 2019 | |
Concentration Risk [Line Items] | ||||||
Accrued liability | $ 213,311 | $ 371,912 | $ 597,351 | |||
Notes Payable | 1,030,079 | |||||
Liability | $ 2,000,000 | |||||
Settlement Agreement [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Liability | $ 2,000,000 | |||||
Accounts receivable [Member] | Three customer [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentrations risk | 79.00% | |||||
Accounts receivable [Member] | One customer [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentrations risk | 86.00% | |||||
Revenue [Member] | Two customer [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentrations risk | 40.00% | |||||
Revenue [Member] | Four customer [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentrations risk | 79.00% | |||||
Accounts receivable [Member] | Three customer [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentrations risk | 79.00% | |||||
Accounts receivable [Member] | Two customer [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentrations risk | 13.00% | |||||
Revenue [Member] | Two customer [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentrations risk | 48.00% | 81.00% | ||||
Concepts and Solutions [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Accrued liability | $ 1,058,240 | $ 2,000,000 | $ 2,000,000 | $ 591,000 |
Material Agreements (Details)
Material Agreements (Details) | Jun. 10, 2019USD ($)shares | Sep. 18, 2020shares | Jul. 30, 2020USD ($) | May 31, 2020USD ($)shares | Apr. 30, 2020 | May 31, 2019USD ($)shares | Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2020USD ($)shares | Jun. 30, 2019USD ($)shares |
Other Commitments [Line Items] | ||||||||||
Shares issued for services, value | $ 2,763,000 | $ 1,283,300 | $ 2,020,914 | |||||||
CEO [Member] | ||||||||||
Other Commitments [Line Items] | ||||||||||
Annual compensation | 500,000 | 500,000 | ||||||||
Non-compete agreement and severance benefits | 90,000 | 90,000 | ||||||||
CFO [Member] | ||||||||||
Other Commitments [Line Items] | ||||||||||
Annual compensation | 250,000 | 250,000 | ||||||||
Non-compete agreement and severance benefits | $ 72,000 | 72,000 | ||||||||
Manufacturer and Distributorship Agreement [Member] | ||||||||||
Other Commitments [Line Items] | ||||||||||
Minimum purchase commitment | 2,000,000 | |||||||||
Consulting Agreement [Member] | ||||||||||
Other Commitments [Line Items] | ||||||||||
Receivables from consulting service | 15,000 | |||||||||
Consulting service fees and expense | $ 15,000 | $ 261,000 | ||||||||
Monthly payment terms of common stock at renewal | $ 15,000 | |||||||||
Monthly payment terms of shares of common stock at renewal | shares | 450,000 | |||||||||
Shares issued for services | shares | 1,097,857 | |||||||||
Percentage of equity interest in Galaxy | 4.90% | |||||||||
Consulting Agreement [Member] | Stock Plan [Member] | ||||||||||
Other Commitments [Line Items] | ||||||||||
Shares issued | shares | 450,000 | |||||||||
Consulting Agreement [Member] | Stock Plan 2020 [Member] | ||||||||||
Other Commitments [Line Items] | ||||||||||
Shares issued for services | shares | 97,250,000 | |||||||||
Consulting Agreement May 2018 [Member] | ||||||||||
Other Commitments [Line Items] | ||||||||||
Consulting service fees and expense | $ 16,500 | $ 222,500 | ||||||||
Consulting Agreement May 2018 [Member] | Advisor [Member] | ||||||||||
Other Commitments [Line Items] | ||||||||||
Consulting service fees and expense | $ 4,000 | |||||||||
Shares issued for services | shares | 10,000 | |||||||||
Shares issued for services, value | $ 15,000 | |||||||||
Agency Agreement [Member] | ||||||||||
Other Commitments [Line Items] | ||||||||||
Consulting service fees and expense | $ 11,600 | $ 98,400 | ||||||||
Shares issued | shares | 212,990 | 46,618 | ||||||||
Agency Agreement [Member] | Minimum [Member] | ||||||||||
Other Commitments [Line Items] | ||||||||||
Percentage of finder's fee | 4.00% | |||||||||
Agency Agreement [Member] | Maximum [Member] | ||||||||||
Other Commitments [Line Items] | ||||||||||
Percentage of finder's fee | 8.00% | |||||||||
Master Service Agreement [Member] | ||||||||||
Other Commitments [Line Items] | ||||||||||
Consulting service fees and expense | $ 300,000 | |||||||||
Common stock | shares | 300,000 | |||||||||
Consulting Agreement May 2019 [Member] | Advisor [Member] | ||||||||||
Other Commitments [Line Items] | ||||||||||
Consulting service fees and expense | $ 24,000 | $ 4,040 | ||||||||
Shares issued for services | shares | 52,508 | |||||||||
Monthly payment of consulting services | $ 8,000 | |||||||||
Financial Advisory Engagement [Member] | Financial advisor [Member] | ||||||||||
Other Commitments [Line Items] | ||||||||||
Shares issued | shares | 0 | 250,000 | ||||||||
Business Development and Marketing Agreement [Member] | ||||||||||
Other Commitments [Line Items] | ||||||||||
Consulting service fees and expense | $ 20,000 | $ 347,300 | $ 35,000 | |||||||
Shares issued | shares | 15,000 | |||||||||
Business Development and Marketing Agreement [Member] | Consultant [Member] | ||||||||||
Other Commitments [Line Items] | ||||||||||
Shares issued for services | shares | 5,510,000 | 60,000 | ||||||||
Consulting Agreement October 1, 2019 [Member] | Advisor [Member] | ||||||||||
Other Commitments [Line Items] | ||||||||||
Shares issued | shares | 50,000 | |||||||||
Consulting Agreement October 1, 2019 [Member] | Consultant [Member] | ||||||||||
Other Commitments [Line Items] | ||||||||||
Consulting service fees and expense | $ 49,800 | $ 0 | ||||||||
Shares issued | shares | 200,000 | |||||||||
Shares issued for services | shares | 150,000 | |||||||||
Consulting Agreement May 2020 [Member] | Investor [Member] | ||||||||||
Other Commitments [Line Items] | ||||||||||
Minimum purchase commitment | $ 2,000,000 | |||||||||
Shares issued | shares | 2,500,000 | |||||||||
Supply Agreement [Member] | ||||||||||
Other Commitments [Line Items] | ||||||||||
Number of units ordered under supply agreement | 4,000 | |||||||||
Supply agreement amount | $ 3,488,000 | |||||||||
Tooling costs | $ 25 | |||||||||
Number of units supplied under supply agreement | 92 | |||||||||
Accounts Receivable Factoring Agreement [Member] | ||||||||||
Other Commitments [Line Items] | ||||||||||
Percentage of factoring fees | 2.50% | |||||||||
Percentage of factoring fees increases | 3.50% | |||||||||
Credit line | $ 1,000,000 | |||||||||
Factored receivables | $ 300,000 | $ 191,223 | ||||||||
Put Purchase Agreement [Member] | ||||||||||
Other Commitments [Line Items] | ||||||||||
Shares issued | shares | 2,500,000 | |||||||||
Value of shares purchased | $ 2,000,000 |
Acquisition (Narrative) (Detail
Acquisition (Narrative) (Details) - USD ($) | Sep. 04, 2019 | Feb. 06, 2019 | Jun. 22, 2018 | Sep. 30, 2019 | Jun. 30, 2020 | Sep. 30, 2020 |
Business Acquisition [Line Items] | ||||||
Shares issued in acquisition | 38,625 | |||||
Shares issued in acquisition, value | $ 92,700 | $ 1,720,351 | $ 1,720,351 | |||
Notes payable | 1,484,473 | $ 1,484,473 | ||||
Accrued pre-acquistion withholding tax liabilities | 584,000 | |||||
Balance of note payables | 1,030,079 | $ 1,030,079 | ||||
FLCR [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Pre-reverse stock split | 3,065,000,000 | |||||
Description of pre reverse stock split | 89% of the outstanding common stock of FLCR, with the remaining 11% of common stock distributed as follows: (a) an ownership interest of seven percent (7%) to the holders of common stock, pro rata; and (b) four percent (4%) of the common stock to the holders of convertible debt, pro rata. | |||||
Net operating loss carryforward | $ 150,000 | |||||
Term period for agreement | 5 years | |||||
Concepts and Solutions [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Shares issued in acquisition | 1,350,000 | |||||
Shares issued in acquisition, value | $ 1,485,000 | |||||
Percentage of stock acquired under stock purchase agreement | 100.00% | |||||
Purchase price for acquisition in notes payable to seller | $ 3,000,000 | |||||
Godwill and other intangible assets | $ 3,760,287 |
Acquisition (Schedule of prelim
Acquisition (Schedule of preliminary allocation of fair value of assets and liabilities) (Details) - USD ($) | Sep. 04, 2019 | Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 |
Assets | ||||
Goodwill | $ 834,220 | $ 834,220 | $ 834,220 | |
FLCR [Member] | ||||
Assets | ||||
Cash | 22,205 | |||
Property and equipment | 4,209,995 | |||
Other | 20,716 | |||
Other assets | 1,511,844 | |||
Goodwill | 892,312 | |||
Total Assets | 6,657,072 | |||
Liabilities | ||||
Accounts payable | 208,763 | |||
Long-term debt | 4,593,851 | |||
Short-term debt | 799,534 | |||
Accrued interest | 78,948 | |||
Other | 83,664 | |||
Total Liabilities | 5,764,760 | |||
Net Assets | 892,312 | |||
Consideration | 58,092 | |||
Fair value of noncontrolling interests | 834,220 | |||
Total Recongnized Identifiable Assets Acquired | $ 892,312 | |||
Concepts and Solutions [Member] | ||||
Assets | ||||
Cash | $ 201,161 | |||
Accounts receivable | 1,165,953 | |||
Inventory | 94,360 | |||
Property and equipment | 20,904 | |||
Other assets | 2,800 | |||
Goodwill and other intangibles | 3,760,287 | |||
Total Assets | 5,245,465 | |||
Liabilities | ||||
Accounts payable | 1,225,734 | |||
Accrued expenses | 783,540 | |||
Short-term debt | 96,941 | |||
Deferred revenue | 518,900 | |||
Total Liabilities | 2,625,115 | |||
Net Assets | 2,620,350 | |||
Fair value of anti-dilution clause in employment agreement | 235,350 | |||
Note payable to seller | 900,000 | |||
Stock | 1,485,000 | |||
Total consideration | $ 2,620,350 |
Acquisition (Schedule of identi
Acquisition (Schedule of identifiable assets and liabilities) (Details) - USD ($) | Feb. 06, 2019 | Jun. 30, 2020 | Jun. 30, 2019 |
Liabilities | |||
Gain on Sale | $ 60,688 | ||
Entertainment [Member] | |||
Assets | |||
Cash | $ 36,290 | ||
Property and equipment | 4,006,426 | ||
Receivables | 4,500 | ||
Inventory | 5,610 | ||
Other assets | 1,522,714 | ||
Total Assets | 5,575,540 | ||
Liabilities | |||
Accounts payable | 22,424 | ||
Debt | 5,393,623 | ||
Accrued expenses | 127,481 | ||
Total Liabilities | 5,543,528 | ||
Net Assets | 32,012 | ||
Consideration | 92,700 | ||
Gain on Sale | $ 60,688 |
Stock Plan (Details)
Stock Plan (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | |
Proceeds from reserved for stock awards | $ 250,000 | $ 2,000,000 | ||
Stock Plan [Member] | ||||
Shares awarded under stock plan | 98,857,857 | 965,000 | 642,857 | 706,618 |
Shares reserved | 9,925,000 |
Going Concern (Details)
Going Concern (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Disclosure of Going Concern [Abstract] | ||||
Accumulated deficit | $ 36,631,570 | $ 23,496,792 | $ 9,470,685 | |
Cash used in operations | 2,823,306 | $ 3,369,258 | 7,373,687 | $ 3,907,348 |
Working capital deficit | $ 5,000,000 | $ 7,000,000 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | Oct. 15, 2020 | Sep. 25, 2020 | Aug. 03, 2020 | Aug. 02, 2020 | Jul. 03, 2020 | Feb. 06, 2019 | Oct. 31, 2020 | Sep. 30, 2020 | Sep. 25, 2020 | Sep. 18, 2020 | Aug. 31, 2020 | Jul. 31, 2020 | Aug. 31, 2020 | Aug. 30, 2020 | Sep. 30, 2020 | Oct. 30, 2020 | Oct. 22, 2020 | Sep. 16, 2020 | Jun. 30, 2020 | Jun. 30, 2019 |
Subsequent Event [Line Items] | ||||||||||||||||||||
Future lease payments due 2021 | $ 114,288 | |||||||||||||||||||
Future lease payments due 2022 | 109,694 | |||||||||||||||||||
Line of credit | $ 936,598 | $ 936,598 | ||||||||||||||||||
Shares issued in acquisition | 38,625 | |||||||||||||||||||
Convertible note | $ 1,133,140 | $ 1,133,140 | $ 1,989,975 | $ 2,876,950 | ||||||||||||||||
Warrant holders [Member] | ||||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||||
Share Issued | 249,792,217 | |||||||||||||||||||
Subsequent Event [Member] | ||||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||||
Factoring fees | 2.50% | |||||||||||||||||||
Increase in factoring fees | 3.50% | |||||||||||||||||||
Line of credit | $ 1,000,000 | |||||||||||||||||||
Factored receivables | $ 390,000 | 300,000 | ||||||||||||||||||
Shares reserved in certificate form as collateral on renewed line of credit | 50,000,000 | |||||||||||||||||||
Subsequent Event [Member] | Asset Purchase Agreement with Classroom Technologies Solutions, Inc [Member] | ||||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||||
Assets acquired | $ 120,000 | |||||||||||||||||||
Promissory note | $ 44,526 | |||||||||||||||||||
Shares issued in acquisition | 10,000,000 | |||||||||||||||||||
Subsequent Event [Member] | Stock Plan 2020 [Member] | ||||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||||
Number of Shares reserved | 97,250,000 | |||||||||||||||||||
Shares issued for services | 6,500,000 | 97,250,000 | ||||||||||||||||||
Subsequent Event [Member] | Settlement Agreement [Member] | ||||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||||
Consulting service fees and expense | $ 732,000 | |||||||||||||||||||
Subsequent Event [Member] | Warrant holders [Member] | ||||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||||
Share Issued | 204,771,864 | |||||||||||||||||||
Subsequent Event [Member] | Investor [Member] | ||||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||||
Debt conversion convertible note amount | $ 58,300 | $ 804,160 | $ 977,350 | $ 1,884,520 | ||||||||||||||||
Debt conversion convertible note shares issued | 7,025,582 | 327,513,771 | 784,966,812 | 242,000,000 | ||||||||||||||||
Convertible notes | $ 500,000 | $ 125,000 | $ 500,000 | |||||||||||||||||
Convertible note | $ 1,200,000 | |||||||||||||||||||
Jacksonville Florida [Member] | Subsequent Event [Member] | ||||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||||
Lease expires date | Jun. 30, 2021 | |||||||||||||||||||
Monthly installments | $ 3,524 | |||||||||||||||||||
Future lease payments due 2021 | $ 43,000 | |||||||||||||||||||
Peoria Arizona [Member] | Subsequent Event [Member] | ||||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||||
Lease expires date | Jul. 31, 2022 | |||||||||||||||||||
Future lease payments due 2021 | $ 29,000 | |||||||||||||||||||
Future lease payments due 2022 | $ 39,000 | |||||||||||||||||||
Peoria Arizona [Member] | Subsequent Event [Member] | Minimum [Member] | ||||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||||
Monthly installments | $ 1,463 | |||||||||||||||||||
Peoria Arizona [Member] | Subsequent Event [Member] | Maximum [Member] | ||||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||||
Monthly installments | $ 3,012 |