Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Jun. 28, 2015 | Aug. 12, 2015 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Optex Systems Holdings Inc | |
Entity Central Index Key | 1,397,016 | |
Trading Symbol | opxs | |
Current Fiscal Year End Date | --09-28 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 174,913,943 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 28, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 28, 2015 | Sep. 28, 2014 |
Current Assets | ||
Cash | $ 885 | $ 1,685 |
Accounts Receivable | 1,068 | 731 |
Net Inventory | 6,777 | 5,910 |
Prepaid Expenses | 63 | 41 |
Total Current Assets | 8,793 | 8,367 |
Property and Equipment | ||
Property Plant and Equipment | 3,845 | 1,744 |
Accumulated Depreciation | (1,787) | (1,540) |
Total Property and Equipment | $ 2,058 | $ 204 |
Other Assets | ||
Intangibles | ||
Prepaid Royalties - Long Term | $ 128 | $ 150 |
Security Deposits | 23 | 26 |
Total Other Assets | 151 | 176 |
Total Assets | 11,002 | 8,747 |
Current Liabilities | ||
Accounts Payable | 910 | 312 |
Accrued Expenses | 696 | 458 |
Accrued Warranties | 28 | 25 |
Customer Advance Deposits - Short Term | 1,183 | 1,072 |
Credit Facility | 550 | |
Total Current Liabilities | 3,367 | 1,867 |
Other Liabilities | ||
Customer Advance Deposits - Long Term | 194 | 982 |
Total Other Liabilities | 194 | 982 |
Total Liabilities | 3,561 | 2,849 |
Stockholders' Equity | ||
Common Stock - (par $0.001, 2,000,000,000 authorized, 174,913,943 and 170,913,943 shares issued and outstanding, respectively) | 175 | |
Additional Paid-in-capital | 26,194 | 18,183 |
Retained Earnings (Deficit) | (18,928) | (12,285) |
Total Stockholders' Equity | 7,441 | 5,898 |
Total Liabilities and Stockholders' Equity | $ 11,002 | $ 8,747 |
Series A Preferred Stock | ||
Stockholders' Equity | ||
Preferred Stock, Value, Issued | ||
Series B Preferred Stock | ||
Stockholders' Equity | ||
Preferred Stock, Value, Issued |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parentheticals) - $ / shares | Jun. 28, 2015 | Mar. 26, 2015 | Sep. 28, 2014 | Sep. 29, 2013 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | ||
Common stock, shares authorized | 2,000,000,000 | 2,000,000,000 | ||
Common stock, shares issued | 174,913,943 | 170,913,943 | ||
Common stock, shares outstanding | 174,913,943 | 170,913,943 | 157,346,607 | |
Series A Preferred Stock | ||||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | ||
Preferred stock, shares authorized | 5,000 | 5,000 | ||
Preferred stock, shares issued | 1,001 | 1,001 | ||
Preferred stock, shares outstanding | 1,001 | 1,001 | ||
Series B Preferred Stock | ||||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 | |
Preferred stock, shares authorized | 1,010 | 1,010 | 1,010 | |
Preferred stock, shares issued | 994 | 0 | ||
Preferred stock, shares outstanding | 994 | 0 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations. - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 28, 2015 | Jun. 29, 2014 | Jun. 28, 2015 | Jun. 29, 2014 | |
Income Statement [Abstract] | ||||
Revenues | $ 2,312 | $ 1,858 | $ 7,814 | $ 7,394 |
Total Cost of Sales | 2,572 | 1,615 | 7,723 | 6,170 |
Gross Margin | (260) | 243 | 91 | 1,224 |
General and Administrative | 741 | 648 | 2,237 | 1,853 |
Operating Loss | (1,001) | (405) | (2,146) | (629) |
Other Income | ||||
Gain on Purchased Asset | 2,110 | |||
Total Other Income | 2,110 | |||
Other Expenses | ||||
Interest Expense | 13 | (6) | 166 | 2 |
Total Other | 13 | (6) | 166 | 2 |
Income (Loss) Before Taxes | (1,014) | (399) | (202) | (631) |
Deferred Income Taxes (Benefit) | (77) | |||
Net Income (Loss) After Taxes | (1,014) | (399) | (202) | (554) |
Preferred stock dividend/premium | (6,441) | |||
Net loss applicable to common shareholders | $ (1,014) | $ (399) | $ (6,643) | $ (554) |
Basic and diluted income (loss) per share (in dollars per share) | $ (0.01) | $ 0 | $ (0.04) | $ 0 |
Weighted Average Common Shares Outstanding ( in share) | 172,320,536 | 170,913,943 | 171,382,807 | 162,949,533 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows. - USD ($) $ in Thousands | 9 Months Ended | |
Jun. 28, 2015 | Jun. 29, 2014 | |
Cash flows from operating activities: | ||
Net loss | $ (202) | $ (554) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 247 | 58 |
Noncash interest expense | 142 | |
Provision for allowance for inventory valuation | 88 | |
(Increase) decrease in deferred tax asset (net of valuation allowance) | (77) | |
Stock option compensation expense | 116 | 76 |
(Increase) decrease in accounts receivable | (337) | 2,170 |
(Increase) decrease in inventory (net of progress billed) | (867) | 552 |
(Increase) decrease in prepaid expenses | (23) | (12) |
(Increase) decrease in security deposits | 3 | |
Increase (decrease) in accounts payable and accrued expenses | 837 | (925) |
Increase (decrease) in accrued warranty costs | 3 | |
Increase (decrease) in customer advance deposits | (677) | (479) |
Total adjustments | (556) | 1,451 |
Net cash provided (used in) by operating activities | (758) | 897 |
Cash flows from investing activities | ||
Purchases of property and equipment | (2,100) | (34) |
Decrease in prepaid royalties - long term | 22 | 22 |
Net cash (used in) investing activities | (2,078) | (12) |
Cash flows from financing activities | ||
Proceeds from convertible notes issued | 1,560 | |
Debt issuance fees | (74) | |
Proceeds (to) from credit facility (net) | 550 | (858) |
Net cash provided by (used in) financing activities | 2,036 | (858) |
Net increase (decrease) in cash | (800) | 27 |
Cash at beginning of period | 1,685 | 882 |
Cash at end of period | 885 | 909 |
Supplemental cash flow information: | ||
Cash paid for interest | 23 | 2 |
Exchange of convertible note and accrued interest to series B preferred stock | 1,629 | |
Beneficial Conversion Feature on series B preferred stock | 4,887 | |
Beneficial Conversion Feature on series A preferred stock | 1,554 | |
Exchange of preferred stock for common stock | $ 10 | $ 100 |
Organization and Operations
Organization and Operations | 9 Months Ended |
Jun. 28, 2015 | |
Organization, Consolidation and Presentation Of Financial Statements [Abstract] | |
Organization and Operations | Note 1 - Organization and Operations On March 30, 2009, Optex Systems Holdings, Inc. (formerly known as Sustut Exploration, Inc.), a Delaware corporation (“Optex Systems Holdings” or the “Company”), along with Optex Systems, Inc., a privately held Delaware corporation (“Optex Systems, Inc.”), which is a wholly-owned subsidiary of Optex Systems Holdings, entered into a reorganization agreement, pursuant to which Optex Systems, Inc. was acquired by Optex Systems Holdings in a share exchange transaction. Optex Systems Holdings became the surviving corporation. At the closing, there was a name change from Sustut Exploration, Inc. to Optex Systems Holdings, Inc., and its year end changed from December 31 to a fiscal year ending on the Sunday nearest September 30. Optex Systems Holdings’ operations are based in Dallas and Richardson, Texas in leased facilities comprising approximately 93,733 square feet. As of June 28, 2015, Optex Systems Holdings operated with 82 full-time equivalent employees. Optex Systems Holdings manufactures optical sighting systems and assemblies, primarily for Department of Defense and foreign military applications. Its products are installed on a variety of U.S. military land vehicles, such as the Abrams and Bradley fighting vehicles, light armored and advanced security vehicles, and have been selected for installation on the Stryker family of vehicles. Optex Systems Holdings also manufactures and delivers numerous periscope configurations, rifle and surveillance sights and night vision optical assemblies. Optex Systems Holdings’ products consist primarily of build to customer print products that are delivered both directly to the military and to other defense prime contractors. On November 3, 2014, Optex Systems, Inc. purchased the assets comprising the Applied Optics Products Line of L-3 Communications, Inc., a thin film coating manufacturer for lenses used primarily in the defense industry. On May 26, 2015, and effective as of May 21, 2015, Optex Systems Holdings entered into a supply agreement with Nightforce Optics, Inc. for supply by Optex Systems Holdings to Nightforce of certain critical optical assemblies through the Applied Optics Center Division. The production rate and delivery schedule shall be agreed upon by the parties and are subject to aggregate annual minimum order values of $3,000,000 in 2015 and $3,900,000 in 2016. The initial term of the agreement is two years, and can be extended by Nightforce for an additional year which continues the forecasted volumes for three years. Optex Systems Holdings is the premium supplier of the covered products to Nightforce, and Optex Systems Holdings agrees to work exclusively with Nightforce on its markets of interest in commercial sporting optics and select military optics; however, Optex Systems Holdings’ existing business arrangements with certain Department of Defense manufacturers are not subject to this exclusivity covenant. On May 5, 2015, Optex Systems Holdings received a written notification from OTC Markets that its bid price for its common stock closed below $0.01 for more than 30 consecutive calendar days and no longer meets the Standards for Continued Eligibility for OTCQB as set forth in Section 2.3(2) of the OTCQB Standards. The notification does not result in the immediate removal of the Company's common stock, and its common stock will continue to trade uninterrupted on the OTCQB. Pursuant to the OTCQB Standards, the Company has been granted a period of 180 calendar days in which to regain compliance with this minimum bid price standard. The 180 calendar day grace period ends on November 1, 2015, and if the Company’s bid price has not closed at or above $0.01 for any ten day consecutive period. On May 15 2015, our board of directors and the shareholders holding a majority of our issued and outstanding Common Stock approved an amendment to our Certificate of Incorporation to effect a reverse stock split which combines the outstanding shares of our common stock into a lesser number of outstanding shares in a ratio of not less than 1:400 nor more than 1:600. On July 22, 2015, our Board of Directors unanimously confirmed our reverse split in the ratio of 1:600 to all shareholders which will take effect on a future date, yet to be determined. As of June 28, 2015, Optex Systems Holdings had working capital of $5.4 million, as compared to $6.5 million as of September 28, 2014. During the nine-months ended June 28, 2015, the Company experienced a net loss of ($202) thousand and a 5.7% or $0.4 million increase in revenues, to $7.8 million from $7.4 million, as compared to the nine-months ended June 29, 2014. The Applied Optics Center, which Optex Systems Holdings acquired on November 3, 2014, contributed 39.8%, or $3 million toward the current fiscal year revenue, which offset an otherwise (35.3)%, or ($2.6) million decrease in the Optex Systems Holdings base revenue excluding the acquisition. The increased general and administrative costs associated with the Applied Optics Center product line through June 28, 2015 was $0.6 million. U.S. military spending has been significantly reduced as a result of the Congressional sequestration cuts to defense spending, which began in fiscal year 2013. As a result of lower U.S. government spending, the Company has continued to explore other opportunities for manufacturing outside of our traditional product lines for products which could be manufactured using our existing lines in order to fully utilize our existing capacity. Backlog has increased by $2.0 million over prior year backlog, of which, $2.8 million of the increased backlog is directly attributable to the Applied Optic Center product line. Given the reduced backlog and revenue of traditional Optex Systems, Inc.’s products from prior year levels, the Company does not anticipate being able to fully offset the reduced government spending with alternative business in the current fiscal year. The Company has historically funded its operations through operations, convertible notes, preferred stock offerings and bank debt. The Company's ability to generate positive cash flows depends on a variety of factors, including the continued development and successful marketing of the Company's products. At June 28, 2015, the Company had approximately $0.9 million in cash and an outstanding payable balance of $0.6 million against our working line of credit. The line of credit allows for borrowing up to a maximum of $1 million, which fluctuates based on our open accounts receivable balance. The Company expects to continue to incur net losses into the first half of fiscal year 2016. Successful transition to attaining profitable operations is dependent upon achieving a level of revenue adequate to support the Company’s cost structure. Management intends to manage operations commensurate with its level of working capital during the next twelve months; however, uneven revenue levels could create a working capital shortfall. In the event the Company does not successfully implement its ultimate business plan, certain assets may not be recoverable. Optex Systems Holdings is an ISO 9001:2008 certified company. |
Accounting Policies
Accounting Policies | 9 Months Ended |
Jun. 28, 2015 | |
Accounting Policies [Abstract] | |
Accounting Policies | Note 2 - Accounting Policies Basis of Presentation Principles of Consolidation: The condensed consolidated financial statements of Optex Systems Holdings included herein have been prepared by Optex Systems Holdings, without audit, pursuant to the rules and regulations of the SEC. Certain information and footnote disclosures normally included in financial statements prepared in conjunction with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although Optex Systems Holdings believes that the disclosures are adequate to make the information presented not misleading. These condensed consolidated financial statements should be read in conjunction with the annual audited consolidated financial statements and the notes thereto included in the Optex Systems Holdings’ Form 10-K for the year ended September 28, 2014 and other reports filed with the SEC. The accompanying unaudited interim consolidated financial statements reflect all adjustments of a normal and recurring nature which are, in the opinion of management, necessary to present fairly the financial position, results of operations and cash flows of Optex Systems Holdings for the interim periods presented. The results of operations for these periods are not necessarily comparable to, or indicative of, results of any other interim period or for the fiscal year taken as a whole. Certain information that is not required for interim financial reporting purposes has been omitted. Use of Estimates: Inventory: (Thousands) June 28, 2015 September 28, 2014 Raw Material $ 4,596 $ 5,136 Work in Process 2,729 1,854 Finished Goods 797 265 Gross Inventory $ 8,122 $ 7,255 Less: Inventory Reserves (1,345 ) (1,345 ) Net Inventory $ 6,777 $ 5,910 Net inventory increased by $867 thousand during the nine months ending June 28, 2015. An increase of $940 thousand is attributable to the acquisition of the Applied Optics Center product line from L-3 on November 3, 2014, which is offset with a decrease in inventory of ($73) thousand of inventory use during the period. See note 3, Purchase of Applied Optics Products Line. Revenue Recognition: The units-of-delivery method recognizes as revenue the contract price of units of a basic production product delivered during a period and as the cost of earned revenue the costs allocable to the delivered units. Costs allocable to undelivered units are reported in the balance sheet as inventory or work in progress. The method is used in circumstances in which an entity produces units of a basic product under production-type contracts in a continuous or sequential production process to buyers’ specifications. Optex Systems Holdings contracts are fixed price production type contracts whereby a defined order quantity is delivered to the customer during a continuous or sequential production process tailored to the buyer’s specifications (build to print). Optex Systems Holdings’ deliveries against these contracts generally occur in monthly increments across fixed delivery periods spanning from 3 to 36 months. Optex Systems Holdings may at times have contracts that allow for invoicing based on achievement of milestone events. In such cases, Optex Systems, Inc. recognizes revenue based on the milestone method in accordance with FASB ASC 605-28, as applicable. On October 24, 2011, Optex Systems, Inc. was awarded an $8.0 million contract with General Dynamics Land Systems - Canada that provided for milestone invoices up to a total of $3.9 million. Currently, there are no additional contracts providing for milestone payments. In accordance with FASB 605-28, Optex Systems, Inc. recognizes milestone payments as revenue upon completion of a substantive milestone as commensurate with the following guidelines: our performance to achieve the milestone, the milestone relates solely to past performance and is reasonable relative to all of the deliverables and payment terms within the arrangement. Milestones are not considered as substantive if any portion of the associated milestone consideration relates to the remaining deliverables in the unit of accounting. Non-substantive milestone payments are reported as a liability on the balance sheet as Short Term and Long Term Customer Advance Deposits. Pursuant to the contract, all substantive milestones events were completed as of September 30, 2012 and as such, there was zero revenue recognized for milestones in the nine months ending June 28, 2015 and June 29, 2014 and no unpaid/invoiced customer deposits related to the completed milestone events, respectively. Customer Advance Deposits: Stock-Based Compensation: The Company’s accounting policy for equity instruments issued to consultants and vendors in exchange for goods and services follows the provisions of FASB ASC 505-50 . Derivative Financial Instruments: “Derivatives and Hedging” “Embedded Derivatives” “Derivatives and Hedging – Contracts in Entity’s own Equity”. Fair Value of Financial Instruments: Fair Value Measurements and Disclosures” ASC 820-10 emphasizes that fair value is a market-based measurement, not an entity-specific measurement. Therefore, a fair value measurement should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, ASC 820-10 establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy). The levels are defined below as: ¨ Level 1 Valuation based on quoted market prices in active markets for identical assets or liabilities that the Company has the ability to access. ¨ Level 2 Valuation based on inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly, and/or based on quoted prices for similar assets and liabilities in active markets. ¨ Level 3 Valuations are unobservable inputs for the asset or liability, which is typically based on an entity’s own assumptions of what market participants would use as fair value, as there is little, if any, related market activity. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability Fair value estimates are reviewed at the origination date and again at the each applicable measurement date and interim or annual financial reporting dates, as applicable financial instrument, and are based upon certain market assumptions and pertinent information available to management at those times. The carrying value of the balance sheet financial instruments included in Optex Systems Holdings’ consolidated financial statements approximated their fair values as of the reporting date. The following table represents certain assets and liabilities of Optex Systems Holdings measured and recorded at fair value on a recurring basis and their level within the fair value hierarchy as of June 28, 2015. (Thousands) Level 1 Level 2 Level 3 Derivatives Liabilities – Long Term $ - $ - $ - (Note Conversion Feature) As of June 28, 2015, $1.6 million of Convertible Notes Payable, which had resulted in prior period derivative liabilities of $6.1 million, were converted to Series B Preferred Stock which is outside of the scope of ASC 815-15 embedded derivatives and ASC 820-10 fair value measurement. Beneficial Conversion Features of Convertible Securities: Optex Systems Holdings has preferred stock, convertible into common shares, containing beneficial conversion features at inception as well as potential beneficial conversion features that could be triggered by future adjustments to the conversion price. Because our preferred stock is perpetual, with no stated maturity date, and the conversions may occur any time from inception, the dividend is recognized immediately when a beneficial conversion exists at issuance. During the three and nine months ending June 28, 2015, Optex Systems Holdings recognized dividends of zero and $6.4 million, respectively on Series A and Series B preferred stock related to the beneficial conversion feature arising from a common stock conversion rate of $0.0025 versus a current market price of $0.01 per common share. Intangible Assets: Intangible assets with indefinite lives are tested annually for impairment, during the fiscal fourth quarter and between annual periods, if impairment indicators exist, and are written down to fair value as required. Income Tax/Deferred Tax: Earnings per Share: The potentially dilutive securities that Optex Systems Holdings has outstanding are convertible preferred stock, stock options and warrants. In computing the dilutive effect of convertible preferred stock or debt, the numerator is adjusted to add back any convertible preferred dividends and interest on convertible debt, and the denominator is increased to assume the conversion of the number of additional common shares. Optex Systems Holdings uses the Treasury Stock Method to compute the dilutive effect of stock options and warrants. Convertible preferred stock, convertible debt, stock options and warrants that are anti-dilutive are excluded from the calculation of diluted earnings per common share. For the three and nine months ended June 28, 2015, respectively, 1,001 shares of Series A preferred stock, 994 shares of Series B preferred stock, 62,857,649 stock options and 1,000,000 warrants were excluded from the earnings per share calculation as anti-dilutive. For the three and nine months ended June 29, 2014, respectively, 1,001 shares of Series A preferred stock, 62,912,649 stock options and 1,000,000 warrants were excluded from the earnings per share calculation as anti-dilutive. |
Purchase of Applied Optics Prod
Purchase of Applied Optics Products Line | 9 Months Ended |
Jun. 28, 2015 | |
Purchase Of Applied Optics Products Line [Abstract] | |
Purchase of Applied Optics Products Line | Note 3 Purchase of Applied Optics Products Line On November 3, 2014, Optex Systems, Inc. entered into a Purchase Agreement with L-3 pursuant to which Optex Systems, Inc. purchased from L-3 the assets comprising L-3’s Applied Optics Products Line (“Purchased Assets”). Applied Optics is primarily engaged in the production, marketing and sales of precision optical assemblies utilizing thin film coating capabilities for optical systems and components primarily used for military purposes. The Purchased Assets consist of personal property, inventory, books and records, contracts, prepaid expenses and deposits, intellectual property, and governmental contracts and licenses utilized in the business comprised of the Purchased Assets. The purchase price for the Purchased Assets was $1,013.1 thousand, which was paid in full at closing, plus the assumption of certain liabilities associated with the Purchased Assets in the approximate amount of $270.7. The source of funds for the acquisition consisted of Optex Systems, Inc.’s working capital of $213.1 thousand and an advance of $800 thousand from accredited investors which was subsequently consummated on November 17, 2014 through the private placement of convertible notes issued by Optex Systems Holdings in a transaction exempt from registration under Section 4(2) of the Securities Act. See Note 7 “Issuance of Convertible Notes”. The asset acquisition met the definition of a business for business combinations under ASC 805-10-20. The following table reconciles the fair value of the acquired assets and assumed liabilities to the total purchase price of the Applied Optics Product Line Acquisition (in thousands): Fair Values as of November 3, 2014 Fixed Assets $ 2,064.7 Inventory 940.1 Prepaid Assets/Other 47.1 Liabilities (270.7 ) Net Assets Acquired $ 2,781.2 Intangible Asset: Customer Contracts/Backlog 342.2 Total Assets Acquired $ 3,123.4 Less: Cash Consideration (1,013.1 ) Gain on Bargain Purchase $ 2,110.3 The aggregate purchase consideration has been allocated to the assets and liabilities acquired, including identifiable intangible assets, based on their respective estimated fair values. The total assets acquired exceeded the total consideration paid, thus there is no goodwill associated with the asset purchase and the acquisition has been determined as a bargain purchase which requires immediate recognition of a gain on the purchased assets. The gain is reflected in earnings in Other Income on the Consolidated Statement of Operations as “Gain on Purchased Asset”. The intangible assets include finite-life intangibles associated with undelivered customer backlog as of the acquisition date and was valued using the income approach methodology that includes the discounted cash flow method as well as other generally accepted valuation methodologies, which requires significant judgment by management. The cash flow projections took into effect the expected net sales from the customer backlog as of November 3, 2014 and the corresponding expenses against those sales in the respective periods. The shipments against the customer backlog were delivered completed between January and June of 2015, and as such, the intangible amortization against those shipments was complete by June 28, 2015. As of June 28, 2015 the balance in unamortized intangible assets was zero. The respective estimated fair values for property plant & equipment, and fixed assets were determined by an independent third-party appraisal firm. The appraisal methods employed by the firm in arriving at the final values on all of the equipment included a combination of the “Cost Approach” the “Market Data Approach” as well as “Income Approach” on specific high historical cost assets as presented by the seller. Certain assets which had very specific military manufacturing applications were operating at less than optimal capacity due to significantly reduced government spending from historical levels related to those processes. The excess or “idle” capacity on these unique assets was considered in the appraiser’s valuation, and the appraised values adjusted downward accordingly, in consideration of the reduced revenue and corresponding limited cash flow that could reasonably be generated from these assets under the current market conditions. Separate from the appraisal analysis, Optex Systems, Inc. completed a physical inventory of all raw material, work in process and finished goods inventories in their various stages of production as of the acquisition date, and conducted a thorough revaluation and review of the counted inventory carrying values giving downward consideration to any excess, obsolete, or other product inventories which were valued in excess of the expected net realizable values given the depressed market conditions. Based on the supplemental inventory review, combined with the income approach used on the excess and idle capacity assets applied by the appraiser, the company was satisfied that the third party appraisal fairly valued those assets. The total fair value appraisal for the purchased assets, before intangible assets and assumed liabilities approximated 73% of the net carrying values of those same assets on the sellers closing balance sheet as of November 3, 2014. Optex Systems Holdings believes that it was able to acquire the Applied Optics Product Line for less than the fair value of its assets because of (i) its unique position as a market leader in the industry segment that directly utilizes the manufactured components specific to the Applied Optics Product Line, (ii) a previous customer/supplier relationship with the acquisition target, (iii) L-3’s intent to exit the optical coating operations, and (iv) L-3’s desire to provide for continued employment of the Applied Optics workforce. The Applied Optics Product Line had a recent history of losses, and the seller approached Optex Systems, Inc. in an effort to sell the product line and exit the optical coating manufacturing business that no longer fit its strategy. With the seller's intent to exit the business segment and Optex’s position as a market leader within the same industry segment utilizing the product line capability, Optex Systems, Inc. was able to agree on a favorable purchase price with L-3 Communications. As a result of the asset purchase, the company has incurred additional acquisition-related costs of approximately $40.2 thousand for legal, accounting and valuation consulting fees which have been expensed to general administrative costs. The following represents condensed pro forma revenue and earnings information for the three and nine months ended June 28, 2015 and June 29, 2014 as if the acquisition of the Applied Optics Product Line had occurred on the first day of each of the fiscal years. Unaudited, Pro forma (Thousands, except share data) Three Months Ending Nine Months Ending June 28, 2015 June 29, 2014 June 28, 2015 June 29, 2014 Revenues $ 2,381 $ 2,548 $ 7,883 $ 10,375 Net Income (Loss) applicable to common shareholders (1,363 ) (1,548 ) (6,992 ) (3,560 ) Diluted earnings per share $ (0.01 ) $ (0.01 ) $ (0.04 ) $ (0.02 ) Weighted Average Shares Outstanding 172,320,536 170,913,943 171,382,807 162,949,533 The unaudited, pro forma information depicted above reflects the impact of the acquisition of the Applied Optics Product Line to the revenue and operating income (loss) of the consolidated entity as of the three and nine months ending June 28, 2015 and June 29, 2014, respectively, as if the acquisition had begun at the beginning of each of the fiscal years. The condensed statements of revenue and earnings exclude the impact of L-3’s corporate allocation costs to the Applied Optics Product Line for the period of September 29 through November 2, 2014, as well as the three months ending June 29, 2014. There is no expected tax effect of the pro forma adjustments for the period affected in fiscal year 2015 due to the net loss and retained deficit of Optex Systems Holdings, Inc. The unaudited pro forma financial information should be read in conjunction with Optex Systems Holding Inc.’s annual report, 10K, filed with the U.S. Securities Exchange Commission for the year ended September 28, 2014 as well as the 8-K filing dated November 7, 2014 and subsequent 8-K/A filed on January 20, 2015. |
Intangible Assets
Intangible Assets | 9 Months Ended |
Jun. 28, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Note 4 – Intangible Assets On November 3, 2014, Optex Systems, Inc. purchased the Applied Optics Products line in exchange for $1,013.1 thousand and the assumption of approximately $270.7 thousand of liabilities (see Note 3). Optex Systems, Inc. has allocated the consideration for the acquisition of the purchased assets among tangible and intangible assets acquired and liabilities assumed based upon their fair values as of the acquisition date. Assets that met the criteria for recognition as intangible assets apart from goodwill were also valued at their fair values. The purchase price was assigned to the acquired interest in the assets and liabilities of Optex Systems Holdings as of November 3, 2014 as follows: Assets: Current assets, consisting primarily of inventory of $940.1 thousand and prepaid assets of $47.1 thousand $ 987.2 Identifiable intangible assets 342.2 Other non-current assets, principally property and equipment 2,064.7 Total assets $ 3,394.1 Liabilities: Current liabilities, consisting of accounts payable of $119.4 thousand and accrued liabilities of $151.3 thousand $ (270.7 ) Acquired net assets $ 3,123.4 The fair values of the intangible assets as of the asset transfer date consisted primarily of $342.2 thousand of undelivered customer order backlog with contracted delivery dates that were essentially fulfilled as of quarter ended June 28, 2015. The amortization of identifiable intangible assets associated with the acquisition has been amortized on a straight line basis over the six month period beginning on December 29, 2014 and ending June 28, 2015 at a rate of $57.0 thousand per month pursuant to the order deliveries. The intangible amortization was allocable to operating expenses as manufacturing cost of sales and general and administrative expenses at a rate of $48.5 thousand and $8.5 thousand per month, respectively, through quarter ending June 28, 2015. The identifiable intangible assets are amortized over 15 years for income tax purposes. Due to the short term duration of these intangible assets, there is no subsequent impairment testing required. There have been no material changes to our assumptions since the acquisition date of November 3, 2014 that would indicate a change in the initial fair value estimate or future expected values during the next nine months which would result in impairment. A schedule of the intangible asset amortization on customer backlog is presented below by month and expense classification of general and administrative and costs of sales accounts. (Thousands) Amortization Schedule COS G&A Total Amortization Unamortized Balance Dec-14 $ - $ - $ - $ 342.2 Jan-15 48.5 8.5 57.0 285.2 Feb-15 48.5 8.5 57.0 228.2 Mar-15 48.5 8.5 57.0 171.2 Apr-15 48.5 8.5 57.0 114.2 May-15 48.5 8.5 57.0 57.2 Jun-15 48.6 8.6 57.2 - Total $ 291.1 $ 51.1 $ 342.2 $ - During the three and nine months ending June 28, 2015, $145.5 thousand and $291.1 thousand had been amortized to cost of sales, respectively, and $25.5 thousand and $51.1 thousand had been amortized to general and administrative expenses, respectively. As of June 28, 2015, the total unamortized balance of intangible assets was zero. There were no unamortized intangible assets or amortization expenses incurred in the three and nine months ending June 29, 2014. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Jun. 28, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 5 - Commitments and Contingencies None. |
Debt Financing
Debt Financing | 9 Months Ended |
Jun. 28, 2015 | |
Debt Disclosure [Abstract] | |
Debt Financing | Note 6 - Debt Financing Related Party – Sileas Corp. On June 5, 2015 (but dated as of May 29, 2015), Sileas Corp., the controlling shareholder of Optex Systems Holdings, Inc., amended its Secured Note, with Longview Fund, L.P., as lender, as follows: The principal amount was increased to $18,022,328.60 to reflect the original principal amount plus all accrued and unpaid interest to date, and the Secured Note ceased to bear interest as of that date.· The maturity date of the note was extended to May 29, 2021 and a conversion feature was added to the Secured Note by which the principal amount of the Secured Note can be converted into our Series A preferred stock, which is owned by Sileas, at the stated value of our Series A preferred stock; Simultaneously therewith, Sileas entered into a Blocker Agreement with us pursuant to which the Series A preferred stock shall not be convertible by Sileas into our common stock, and we shall not effect any conversion of the Series A Stock or otherwise issue any shares of our common stock pursuant hereto, to the extent (but only to the extent) that after giving effect to such conversion or other share issuance hereunder Sileas (together with its affiliates) would beneficially own in excess of 9.99% our common stock. Sileas also agreed to not vote any of its shares of Series A preferred stock in excess of 9.99% of our common stock. Credit Facility – Avidbank On May 22, 2014 , the Company amended its revolving credit facility with Avidbank. The new renewable revolving maturity date is May 21, 2016. The facility provides up to $1 million in financing against eligible receivables and subject to meeting certain covenants including an asset coverage ratio test for up to two years. The material terms of the amended revolving credit facility are as follows: • The interest rate for all advances shall be the greater of 7.0% and the then in effect prime rate plus 2.5%. The additional minimum interest payment requirement per six month period is $10,000. • Interest shall be paid monthly in arrears. • The loan period is from May 22nd through May 21st of the following year, beginning with the period of May 22, 2014 through May 21, 2015 and a revolving loan maturity date of May 21, 2016, at which time any outstanding advances, and accrued and unpaid interest thereon, will be due and payable. • A renewal fee of $5,000 is due on the one year anniversary of the date of the loan agreement. • The obligations of Optex Systems, Inc. to Avidbank are secured by a first lien on all of its assets (including intellectual property assets should it have any in the future) in favor of Avidbank. • The facility contains customary events of default. Upon the occurrence of an event of default that remains uncured after any applicable cure period, Avidbank’ s commitment to make further advances may terminate, and Avidbank would also be entitled to pursue other remedies against Optex Systems, Inc. and the pledged collateral. • Pursuant to a guaranty executed by Optex Systems Holdings in favor of Avidbank, Optex Systems Holdings has guaranteed all obligations of Optex Systems, Inc. to Avidbank. As of June 28, 2015, the outstanding balance on the line of credit was $550 thousand. For the three and nine months ended June 28, 2015, the total interest expense against the outstanding line of credit balance was $10 thousand and $20 thousand, respectively. For the three and nine months ended June 29, 2014, the total interest expense against the outstanding line of credit balance was $6 thousand and $16 thousand, respectively. Issuance of Convertible Notes On November 17, 2014, Optex Systems Holdings entered into a Subscription Agreement (the “Agreement”) to sell up to $2.1 million principal amount of convertible promissory notes (“Notes”) to several accredited investors (the “Investors”) in a private placement pursuant to which the Investors purchased a series of Notes with an aggregate principal amount of $1,550 thousand. An additional convertible promissory note for $10 thousand was issued to the placement agency in consideration for placement services on the transaction. The terms are consistent for each of the notes issued as follows: ¨ The notes bear interest at a rate of 12% per annum and mature two years after the date of the issuance. ¨ The interest is due either in cash or, at its option, through stock, or a combination at the option of Optex Systems Holdings. ¨ The notes are convertible at the option of the note holders at any time into shares of Optex Systems Holdings’ common stock, par value $0.001 per share (the “Common Stock”) at a conversion price equal to $0.0025 per share. ¨ All or part of the then remaining principal amount of the notes may be prepaid at any time at a price equal to 125% of the sum of the remaining principal amount of the notes to be prepaid plus all accrued and unpaid interest thereon. ¨ The converted stock may not exceed 3.33% of beneficial ownership for any holder or attribution parties. ¨ The agreement also requires the Optex Systems Holdings to affect at least a 1:350 reverse split of its common stock no later than 90 days from November 17, 2014. ¨ The conversion price of the notes is subject to “full ratchet” anti-dilution adjustment for subsequent lower price issuances by Optex Systems Holdings, as well as customary adjustments provisions for stock splits, stock dividends, recapitalizations and the like. ¨ The notes contain certain customary negative covenants and events of default, including, but not limited to, Optex Systems Holdings’ failure to pay principal and interest, material defaults under the other transaction documents, bankruptcy, and Optex Systems Holdings’ failure to deliver Common Stock certificates after a conversion date. Pursuant to a Registration Rights Agreement, of even date, between the Company and the Investors, Optex Systems Holdings is obligated to file a registration statement with the Securities and Exchange Commission (“SEC”) registering the shares underlying the Notes for public resale by January 17, 2015 and cause such registration statement to be effective by March 17, 2015. The Company is subject to certain liquidated damages in the event it does not satisfy such obligations and other obligations under such Registration Rights Agreement. All of the noteholders have waived the Company’s obligations to file a registration statement by January 17, 2015 and to effect a reverse split of its common stock by February 17, 2015. Sileas Corp., the controlling shareholder of Optex Systems Holdings, also entered into a Make Whole Agreement, of even date, with the Investors for the benefit of the Company, pursuant to which, unless and until Optex Systems Holdings’ common stock is listed on the NASDAQ Capital Market, it will make payment to the investors of interest on the Notes, on any date on which interest is due and payable under the Notes, from the date of payment until the maturity date of the Notes. There is no corresponding agreement between Sileas and Optex Systems Holdings, and thus no related party transaction. The securities sold to the investors were not registered under the Securities Act of 1933, as amended (the “Securities Act”), or the securities laws of any state, and were offered and sold in reliance on the exemption from registration afforded by Section 4(a)(2) under the Securities Act and/or Regulation D promulgated thereunder and corresponding provisions of state securities laws, which exempt transactions by an issuer not involving any public offering. The Investors are “accredited investors” as such term is defined in Regulation D promulgated under the Securities Act. Optex Systems, Inc. incurred $74 thousand in debt issuance costs, for investment banking, legal and placements fee services, inclusive of the $10 thousand supplemental convertible note issued for placement fees. These costs are reflected in the balance sheet and cash flow statement as debt issuance costs and are amortized to interest expense across the term of the notes based on the effective interest method. For the three and nine months ending June 28, 2015 the amortized interest expense related to the debt was $3 thousand and $146 thousand, respectively. On March 26, 2015, Optex Systems Holdings filed a Certificate of Designation with respect to its Certificate of Incorporation to authorize a series of preferred stock known as “Series B Preferred Stock” under Article FOURTH thereof, with 1010 shares of Series B Preferred Stock issuable thereunder. The amendment was approved by the Company’s Board of Directors under Article FOURTH of its Certificate of Incorporation, as amended. The stated value of each share of Series B Preferred Stock is $1,629, and each share of Series B Preferred Stock is convertible into shares of the Company’s common stock at a conversion price of $0.0025. Holders of the Series B Preferred Stock receive preferential rights in the event of liquidation to other classes of preferred and common stock of the Company other than the Company’s Series A Preferred Stock. Additionally, the holders of the Series B Preferred Stock are entitled to vote together with the common stock and the Series A Preferred Stock on an “as-converted” basis. On March 29, 2015, the holders of the Company’s $1,560,000 principal amount of convertible promissory notes, issued on or about November 17, 2014, converted the entire principal amount thereof and all accrued and unpaid interest thereon, into 1,000 shares of the Company’s Series B Preferred Stock. |
Stock Based Compensation
Stock Based Compensation | 9 Months Ended |
Jun. 28, 2015 | |
Disclosure Of Compensation Related Costs, Share-Based Payments [Abstract] | |
Stock Based Compensation | Note 7 Stock Based Compensation Optex Systems Holdings has granted stock options to officers and employees as follows: Date of Shares Exercise Shares Outstanding Expiration Vesting Grant Granted Price As of 6/28/15 Date Period 03/30/09 1,414,649 $ 0.15 1,414,649 03/29/2016 3 years 05/14/09 1,267,000 $ 0.15 1,073,000 05/13/2016 4 years 12/09/11 46,070,000 $ 0.01 35,370,000 12/08/2018 4 years 12/19/13 25,000,000 $ 0.01 25,000,000 12/18/2020 4 years Total 73,751,649 62,857,649 Optex Systems Holdings recorded compensation costs for options and shares granted under the plan amounting to for $25 thousand and $116 thousand for the three and nine months ended June 28, 2015, respectively, and $29 thousand and $76 thousand for the three and nine months ended June 29, 2014, respectively. The $116 thousand of compensation expense recorded during the nine months ending June 28, 2015 included $57 thousand of expenses directly attributable to the early vesting of 12,500 shares on the resignation of the Chairman of the Board on November 19, 2014. The following table summarizes the status of Optex Systems Holdings’ aggregate stock options granted under the incentive stock option plan: Number Weighted of Shares Average Weighted Aggregate Remaining Fair Average Value Subject to Exercise Options Value Life (Years) (Thousands) Outstanding as of September 29, 2013 48,247,649 $ — 3.56 — Granted – 2014 25,000,000 $ 0.01 5.22 $ 200 Forfeited – 2014 (5,336,000 ) $ — — Exercised – 2014 (5,000,000 ) $ 0.01 — Outstanding as of September 28, 2014 62,911,649 $ — 3.41 — Granted – 2015 — $ $ Forfeited – 2015 (54,000 ) $ — Exercised – 2015 — $ — Outstanding as of June 28, 2015 62,857,649 2.56 $ — Exercisable as of September 28, 2014 20,201,649 $ — 1.76 $ — Exercisable as of June 28, 2015 40,265,149 $ — 1.69 $ — There were zero and 25,000,000 options granted in the nine months ended June 28, 2015 and June 29, 2014, respectively. The following table summarizes the status of Optex Systems Holdings’ aggregate non-vested shares granted under the 2009 Stock Option Plan: Number of Non-vested Shares Subject to Options Weighted- Average Grant- Date Fair Value Non-vested as of September 29, 2013 30,547,500 $ 0.01 Non-vested granted — year ended September 28, 2014 25,000,000 $ 0.01 Vested — year ended September 28, 2014 (7,501,500 ) $ 0.01 Forfeited — year ended September 28, 2014 (5,336,000 ) $ Non-vested as of September 28, 2014 42,710,000 $ 0.01 Non-vested granted — nine months ended June 28, 2015 — $ — Vested — nine months ended June 28, 2015 (20,063,500 ) $ 0.01 Forfeited — nine months ended June 28, 2015 (54,000 ) $ — Non-vested as of June 28, 2015 22,592,500 $ 0.01 As of June 28, 2015, the unrecognized compensation cost for non-vested share based compensation arrangements granted under the plan was approximately $159 thousand. These costs are expected to be recognized on a straight line basis through December 2017. Warrant Agreements: As of June 28, 2015, Optex Systems Holdings had the following warrants outstanding: Grant Date Warrants Granted Exercise Price Outstanding as of 6/28/15 Expiration Date Term Avidbank- Line of Credit 3/4/2010 1,000,000 $ 0.10 1,000,000 3/3/2016 6 years Total Warrants 1,000,000 1,000,000 During the three and nine months ended June 28, 2015 and the three and nine months ended June 29, 2014, Optex Systems Holdings recorded zero interest expense related to the outstanding warrants. Interest expense related to outstanding warrants was fully amortized as of September 28, 2014. |
Stockholders Equity
Stockholders Equity | 9 Months Ended |
Jun. 28, 2015 | |
Stockholders Equity Note [Abstract] | |
Stockholder's Equity | Note 8 Stockholder’s Equity Common stock As of September 29, 2013, Optex Systems had 157,346,607 common shares outstanding. During the twelve months ending September 28, 2014 Alpha Capital Anstalt converted 14.58 shares of Series A preferred stock at a stated value of $6,860 into 10,000,000 shares of its Common Stock at a conversion price of $0.01 per share for a converted value of $100,000 and a former director exercised 5,000,000 options at $0.01 per share in a net exchange for 3,567,336 common shares. The outstanding common shares as of September 28, 2014 were 170,913,943. On March 29, 2015, we issued 1000 shares of our series B preferred stock in exchange for convertible notes. On May 27, 2015 a private investor converted $10 thousand, or 6 shares of the Series B preferred stock at a stated value of $1,629 per share, for 4,000,000 shares of common stock. The outstanding common shares as of June 28, 2015 were 174,913,943. There were no other issuances of common or preferred stock during the three months and nine months ended June 28, 2015 and June 29, 2014. On May 15 2015, our board of directors and the shareholders holding a majority of our issued and outstanding Common Stock approved an amendment to our Certificate of Incorporation to effect a reverse stock split which combines the outstanding shares of our common stock into a lesser number of outstanding shares in a ratio of not less than 1:400 nor more than 1:600. On July 22, 2015, our Board of Directors unanimously confirmed our reverse split in the ratio of 1:600 to all shareholders which will take effect on a future date, yet to be determined. Series A preferred stock Optex Systems Holdings has filed a Certificate of Designation with the Secretary of State of the State of Delaware authorizing a series of preferred stock, under its articles of incorporation, known as “Series A preferred stock”. The Certificate of Designation currently sets forth the following terms for the Series A preferred stock: (i) number of authorized shares: 1,027; (ii) per share stated value: $6,860; (iii) liquidation preference per share: stated value; (iv) conversion price: $0.15 per share as adjusted from time to time; and (v) voting rights: votes along with the common stock on an as converted basis with one vote per share (vi) par value $0.001 per share. The conversion price was subsequently reset to $0.01 per share as discussed below. The Series A preferred stock entitles the holders to receive cumulative dividends at the rate of 6% per annum, payable in cash at the discretion of Board of Directors. Each share of preferred stock is immediately convertible into common shares at the option of the holder which entitles the holder to receive the equivalent number of common shares equal to the stated value of the preferred shares divided by the conversion price, which was initially set at $0.15 per share. The dividends were subsequently waived and the price per share was reset to $0.01 on February 21, 2012 as discussed below. On November 17, 2014 an exercise price per share ratchet was triggered by the issuance of convertible notes with a lower conversion price and the exercise price was reset to $0.0025 per common share. Holders of preferred shares receive preferential rights in the event of liquidation. Additionally the preferred stock shareholders are entitled to vote together with the common stock on an “as-converted” basis. As of April 1, 2012, the preferred shareholders agreed to waive the past dividends in arrears through June 29, 2014 of $884 thousand in exchange for an increase in the stated value to $6,860. On February 21, 2012, in connection with the purchase of the 5,000,000 shares of common stock of Optex Systems Holdings by Alpha Capital, the preferred shareholders executed an irrevocable waiver for any and all previously accrued and outstanding dividends and the right to receive any future dividends on the Series A Preferred Stock. The per share conversion price of the Optex Systems Holdings’ Series A Preferred Stock was automatically reset to $0.01 per share in accordance with the reset provision as set forth in paragraph 4(d)(ii) of the Series Designation for the Optex Systems Holdings’ Series A Preferred Stock. The total amount of dividends waived as a result of the February 21, 2012 waiver is $213 thousand. As of the three months ended June 28, 2015 and June 29, 2014, there were no preferred dividends payable. As of September 28, 2014 and June 28, 2015 as a result of the executed waiver dated February 21, 2012, there were no dividends in arrears on preferred shares and no future dividends will accrue on the preferred shares. On March 19, 2013, Alpha Capital Anstalt converted 7.29 shares of Series A preferred stock at a stated value of $6,860 into 5,000,000 shares of its Common Stock for a total converted value of $50,000. On February 11, 2014 and March 24, 2014, Alpha Capital Anstalt converted 7.29 shares of Series A preferred stock at a stated value of $6,860 into 8,333 shares of its Common Stock for a converted value of $50,000 each transaction, respectively. As a result of the conversions, Optex Systems Holdings had 1,001 of preferred shares outstanding as of June 28, 2015 and 1,001 of preferred shares outstanding as of September 28, 2014 respectively. As of April 3, 2015, a majority in interest of the holders of the Series A preferred stock has waived the right to convert its Series A preferred stock into Company common shares until such a time as a reverse stock split of the Company’s stock is effected in sufficient ratio to accommodate full conversion of both Series A and Series B preferred stock from authorized and unissued shares. Based on the price reset from $0.01 to $0.0025 per common share, there are 75.5 shares of preferred stock with a beneficial conversion feature, “in the money”, which are subject to immediate conversion at the discretion of the holder. In the three and nine months ending June 28, 2015, Optex Systems Holdings has recognized a $1.5 million adjustment to retained earnings for dividends for the intrinsic value of the beneficial conversion feature for the 75.5 preferred shares issued and not covered by the conversion waiver. The remaining 926 outstanding Series A preferred shares will become convertible to common shares based on a future event. Based on the market price of the common stock of $0.0066 as of June 26, 2015, these preferred shares are subject to an additional $10.4 million retained earnings adjustment for dividends on the earliest potential conversion date as they become convertible. As these shares are subject to the potential for further adjustments to the conversion ratio based on future occurrences, any new conversion price reset may trigger recognition of an additional beneficial conversion feature on occurrence. Series B Preferred Stock On March 26, 2015, Optex Systems Holdings filed a Certificate of Designation with the Secretary of State of the State of Delaware authorizing a series of preferred stock, under its articles of incorporation, known as “Series B preferred stock”. The Certificate of Designation currently sets forth the following terms for the Series B preferred stock: (i) number of authorized shares: 1,010; (ii) per share stated value: $1,629 (iii) liquidation preference per share, other than Series A preferred stock: stated value; (iv) conversion price: $0.0025 per share as adjusted from time to time; (v) voting rights: votes along with the common stock on an as converted basis with one vote per share; and (vi) par value of $0.001 per share. On June 28, 2015, the holders of the Company’s $1,560,000 principal amount of convertible promissory notes, issued on or about November 17, 2014, converted the entire principal amount thereof and all accrued and unpaid interest thereon, into 1,000 shares of the Company’s Series B Preferred Stock. Each share of preferred stock is immediately convertible into common shares at the option of the holder which entitles the holder to receive the equivalent number of common shares equal to the stated value of the preferred shares divided by the conversion price, which is initially set at $0.0025 per share. On May 27, 2015 a private investor converted $10 thousand, or 6 shares of the Series B preferred stock at a stated value of $1,629 per share, for 4,000,000 shares of common stock. As of June 28, 2015, there were 994 shares of Series B preferred shares outstanding. At the time of issuance, the market value of the common stock was $0.01. As the conversion rate of $0.0025 was below the market price, the issued preferred series B stock contained a beneficial conversion feature. As the series B preferred stock is immediately convertible with no stated maturity date, Optex Systems Holdings recognized a retained earnings and additional paid in capital adjustment for the intrinsic value, “in the money portion”, of the conversion options at inception. For the three and nine months ending June 28, 2015 Optex Systems Holdings recognized a retained earnings dividends and additional paid in capital adjustment of $4.9 million, which represented the intrinsic value of the options at the commitment date. As these shares are subject to the potential for further adjustments to the conversion ratio based on future occurrences, any new conversion price reset may trigger recognition of an additional beneficial conversion feature on occurrence. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Jun. 28, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 9 Subsequent Events On July 14, 2015, the board of directors approved directors’ compensation of $1,000 monthly for each independent board member and a $500 stipend per meeting attended. In addition, each independent board member is to be granted 21,000 (post split) shares, with 7,000 shares vesting on the grant date, and on the first and second anniversary thereof. The Chair of each Board Committee would be granted an additional 5,000 (post split) shares, vesting immediately. On July 22, 2015, our Board of Directors unanimously confirmed our reverse split in the ratio of 1:600 to all shareholders to take effect on a future date, yet to be determined. The par value of the common stock outstanding shall remain at $0.001 per share subsequent to the reverse split action. |
Accounting Policies (Policies)
Accounting Policies (Policies) | 9 Months Ended |
Jun. 28, 2015 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation: The condensed consolidated financial statements of Optex Systems Holdings included herein have been prepared by Optex Systems Holdings, without audit, pursuant to the rules and regulations of the SEC. Certain information and footnote disclosures normally included in financial statements prepared in conjunction with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although Optex Systems Holdings believes that the disclosures are adequate to make the information presented not misleading. These condensed consolidated financial statements should be read in conjunction with the annual audited consolidated financial statements and the notes thereto included in the Optex Systems Holdings’ Form 10-K for the year ended September 28, 2014 and other reports filed with the SEC. The accompanying unaudited interim consolidated financial statements reflect all adjustments of a normal and recurring nature which are, in the opinion of management, necessary to present fairly the financial position, results of operations and cash flows of Optex Systems Holdings for the interim periods presented. The results of operations for these periods are not necessarily comparable to, or indicative of, results of any other interim period or for the fiscal year taken as a whole. Certain information that is not required for interim financial reporting purposes has been omitted. |
Use of Estimates | Use of Estimates: |
Inventory | Inventory: (Thousands) June 28, 2015 September 28, 2014 Raw Material $ 4,596 $ 5,136 Work in Process 2,729 1,854 Finished Goods 797 265 Gross Inventory $ 8,122 $ 7,255 Less: Inventory Reserves (1,345 ) (1,345 ) Net Inventory $ 6,777 $ 5,910 Net inventory increased by $867 thousand during the nine months ending June 28, 2015. An increase of $940 thousand is attributable to the acquisition of the Applied Optics Center product line from L-3 on November 3, 2014, which is offset with a decrease in inventory of ($73) thousand of inventory use during the period. See note 3, Purchase of Applied Optics Products Line. |
Revenue Recognition | Revenue Recognition: The units-of-delivery method recognizes as revenue the contract price of units of a basic production product delivered during a period and as the cost of earned revenue the costs allocable to the delivered units. Costs allocable to undelivered units are reported in the balance sheet as inventory or work in progress. The method is used in circumstances in which an entity produces units of a basic product under production-type contracts in a continuous or sequential production process to buyers’ specifications. Optex Systems Holdings contracts are fixed price production type contracts whereby a defined order quantity is delivered to the customer during a continuous or sequential production process tailored to the buyer’s specifications (build to print). Optex Systems Holdings’ deliveries against these contracts generally occur in monthly increments across fixed delivery periods spanning from 3 to 36 months. Optex Systems Holdings may at times have contracts that allow for invoicing based on achievement of milestone events. In such cases, Optex Systems, Inc. recognizes revenue based on the milestone method in accordance with FASB ASC 605-28, as applicable. On October 24, 2011, Optex Systems, Inc. was awarded an $8.0 million contract with General Dynamics Land Systems - Canada that provided for milestone invoices up to a total of $3.9 million. Currently, there are no additional contracts providing for milestone payments. In accordance with FASB 605-28, Optex Systems, Inc. recognizes milestone payments as revenue upon completion of a substantive milestone as commensurate with the following guidelines: our performance to achieve the milestone, the milestone relates solely to past performance and is reasonable relative to all of the deliverables and payment terms within the arrangement. Milestones are not considered as substantive if any portion of the associated milestone consideration relates to the remaining deliverables in the unit of accounting. Non-substantive milestone payments are reported as a liability on the balance sheet as Short Term and Long Term Customer Advance Deposits. Pursuant to the contract, all substantive milestones events were completed as of September 30, 2012 and as such, there was zero revenue recognized for milestones in the nine months ending June 28, 2015 and June 29, 2014 and no unpaid/invoiced customer deposits related to the completed milestone events, respectively. |
Customer Advance Deposits | Customer Advance Deposits: |
Stock-Based Compensation | Stock-Based Compensation: The Company’s accounting policy for equity instruments issued to consultants and vendors in exchange for goods and services follows the provisions of FASB ASC 505-50 . |
Derivative Financial Instruments | Derivative Financial Instruments: “Derivatives and Hedging” “Embedded Derivatives” “Derivatives and Hedging – Contracts in Entity’s own Equity”. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments: Fair Value Measurements and Disclosures” ASC 820-10 emphasizes that fair value is a market-based measurement, not an entity-specific measurement. Therefore, a fair value measurement should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, ASC 820-10 establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy). The levels are defined below as: ¨ Level 1 Valuation based on quoted market prices in active markets for identical assets or liabilities that the Company has the ability to access. ¨ Level 2 Valuation based on inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly, and/or based on quoted prices for similar assets and liabilities in active markets. ¨ Level 3 Valuations are unobservable inputs for the asset or liability, which is typically based on an entity’s own assumptions of what market participants would use as fair value, as there is little, if any, related market activity. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability Fair value estimates are reviewed at the origination date and again at the each applicable measurement date and interim or annual financial reporting dates, as applicable financial instrument, and are based upon certain market assumptions and pertinent information available to management at those times. The carrying value of the balance sheet financial instruments included in Optex Systems Holdings’ consolidated financial statements approximated their fair values as of the reporting date. The following table represents certain assets and liabilities of Optex Systems Holdings measured and recorded at fair value on a recurring basis and their level within the fair value hierarchy as of June 28, 2015. (Thousands) Level 1 Level 2 Level 3 Derivatives Liabilities – Long Term $ - $ - $ - (Note Conversion Feature) As of June 28, 2015, $1.6 million of Convertible Notes Payable, which had resulted in prior period derivative liabilities of $6.1 million, were converted to Series B Preferred Stock which is outside of the scope of ASC 815-15 embedded derivatives and ASC 820-10 fair value measurement. |
Beneficial Conversion Features of Convertible Securities | Beneficial Conversion Features of Convertible Securities: Optex Systems Holdings has preferred stock, convertible into common shares, containing beneficial conversion features at inception as well as potential beneficial conversion features that could be triggered by future adjustments to the conversion price. Because our preferred stock is perpetual, with no stated maturity date, and the conversions may occur any time from inception, the dividend is recognized immediately when a beneficial conversion exists at issuance. During the three and nine months ending June 28, 2015, Optex Systems Holdings recognized dividends of zero and $6.4 million, respectively on Series A and Series B preferred stock related to the beneficial conversion feature arising from a common stock conversion rate of $0.0025 versus a current market price of $0.01 per common share. |
Intangible Assets | Intangible Assets: Intangible assets with indefinite lives are tested annually for impairment, during the fiscal fourth quarter and between annual periods, if impairment indicators exist, and are written down to fair value as required. |
Income Tax/Deferred Tax | Income Tax/Deferred Tax: |
Earnings per Share | Earnings per Share: The potentially dilutive securities that Optex Systems Holdings has outstanding are convertible preferred stock, stock options and warrants. In computing the dilutive effect of convertible preferred stock or debt, the numerator is adjusted to add back any convertible preferred dividends and interest on convertible debt, and the denominator is increased to assume the conversion of the number of additional common shares. Optex Systems Holdings uses the Treasury Stock Method to compute the dilutive effect of stock options and warrants. Convertible preferred stock, convertible debt, stock options and warrants that are anti-dilutive are excluded from the calculation of diluted earnings per common share. For the three and nine months ended June 28, 2015, respectively, 1,001 shares of Series A preferred stock, 994 shares of Series B preferred stock, 62,857,649 stock options and 1,000,000 warrants were excluded from the earnings per share calculation as anti-dilutive. For the three and nine months ended June 29, 2014, respectively, 1,001 shares of Series A preferred stock, 62,912,649 stock options and 1,000,000 warrants were excluded from the earnings per share calculation as anti-dilutive. |
Accounting Policies (Tables)
Accounting Policies (Tables) | 9 Months Ended |
Jun. 28, 2015 | |
Accounting Policies [Abstract] | |
Schedule of inventory | (Thousands) June 28, 2015 September 28, 2014 Raw Material $ 4,596 $ 5,136 Work in Process 2,729 1,854 Finished Goods 797 265 Gross Inventory $ 8,122 $ 7,255 Less: Inventory Reserves (1,345 ) (1,345 ) Net Inventory $ 6,777 $ 5,910 |
Schedule of certain assets and liabilities measured and recorded at fair value on a recurring basis | (Thousands) Level 1 Level 2 Level 3 Derivatives Liabilities – Long Term $ - $ - $ - (Note Conversion Feature) |
Purchase of Applied Optics Pr17
Purchase of Applied Optics Products Line (Tables) | 9 Months Ended |
Jun. 28, 2015 | |
Purchase Of Applied Optics Products Line [Abstract] | |
Schedule of fair value of the acquired assets and assumed liabilities | Fair Values as of November 3, 2014 Fixed Assets $ 2,064.7 Inventory 940.1 Prepaid Assets/Other 47.1 Liabilities (270.7 ) Net Assets Acquired $ 2,781.2 Intangible Asset: Customer Contracts/Backlog 342.2 Total Assets Acquired $ 3,123.4 Less: Cash Consideration (1,013.1 ) Gain on Bargain Purchase $ 2,110.3 |
Schedule of pro forma condensed balance sheet and revenue and earnings information | Unaudited, Pro forma (Thousands, except share data) Three Months Ending Nine Months Ending June 28, 2015 June 29, 2014 June 28, 2015 June 29, 2014 Revenues $ 2,381 $ 2,548 $ 7,883 $ 10,375 Net Income (Loss) applicable to common shareholders (1,363 ) (1,548 ) (6,992 ) (3,560 ) Diluted earnings per share $ (0.01 ) $ (0.01 ) $ (0.04 ) $ (0.02 ) Weighted Average Shares Outstanding 172,320,536 170,913,943 171,382,807 162,949,533 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 9 Months Ended |
Jun. 28, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of purchase price was assigned to the acquired interest in the assets and liabilities | Assets: Current assets, consisting primarily of inventory of $940.1 thousand and prepaid assets of $47.1 thousand $ 987.2 Identifiable intangible assets 342.2 Other non-current assets, principally property and equipment 2,064.7 Total assets $ 3,394.1 Liabilities: Current liabilities, consisting of accounts payable of $119.4 thousand and accrued liabilities of $151.3 thousand $ (270.7 ) Acquired net assets $ 3,123.4 |
Schedule of the intangible asset amortization on customer backlog | (Thousands) Amortization Schedule COS G&A Total Amortization Unamortized Balance Dec-14 $ - $ - $ - $ 342.2 Jan-15 48.5 8.5 57.0 285.2 Feb-15 48.5 8.5 57.0 228.2 Mar-15 48.5 8.5 57.0 171.2 Apr-15 48.5 8.5 57.0 114.2 May-15 48.5 8.5 57.0 57.2 Jun-15 48.6 8.6 57.2 - Total $ 291.1 $ 51.1 $ 342.2 $ - |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 9 Months Ended |
Jun. 28, 2015 | |
Disclosure Of Compensation Related Costs, Share-Based Payments [Abstract] | |
Schedule of stock options granted to officers and employees | Date of Shares Exercise Shares Outstanding Expiration Vesting Grant Granted Price As of 6/28/15 Date Period 03/30/09 1,414,649 $ 0.15 1,414,649 03/29/2016 3 years 05/14/09 1,267,000 $ 0.15 1,073,000 05/13/2016 4 years 12/09/11 46,070,000 $ 0.01 35,370,000 12/08/2018 4 years 12/19/13 25,000,000 $ 0.01 25,000,000 12/18/2020 4 years Total 73,751,649 62,857,649 |
Schedule of aggregate stock options granted under the incentive stock option plan | Number Weighted of Shares Average Weighted Aggregate Remaining Fair Average Value Subject to Exercise Options Value Life (Years) (Thousands) Outstanding as of September 29, 2013 48,247,649 $ — 3.56 — Granted – 2014 25,000,000 $ 0.01 5.22 $ 200 Forfeited – 2014 (5,336,000 ) $ — — Exercised – 2014 (5,000,000 ) $ 0.01 — Outstanding as of September 28, 2014 62,911,649 $ — 3.41 — Granted – 2015 — $ $ Forfeited – 2015 (54,000 ) $ — Exercised – 2015 — $ — Outstanding as of June 28, 2015 62,857,649 2.56 $ — Exercisable as of September 28, 2014 20,201,649 $ — 1.76 $ — Exercisable as of June 28, 2015 40,265,149 $ — 1.69 $ — |
Schedule of aggregate non-vested shares granted under the 2009 Stock Option Plan | Number of Non-vested Shares Subject to Options Weighted- Average Grant- Date Fair Value Non-vested as of September 29, 2013 30,547,500 $ 0.01 Non-vested granted — year ended September 28, 2014 25,000,000 $ 0.01 Vested — year ended September 28, 2014 (7,501,500 ) $ 0.01 Forfeited — year ended September 28, 2014 (5,336,000 ) $ Non-vested as of September 28, 2014 42,710,000 $ 0.01 Non-vested granted — nine months ended June 28, 2015 — $ — Vested — nine months ended June 28, 2015 (20,063,500 ) $ 0.01 Forfeited — nine months ended June 28, 2015 (54,000 ) $ — Non-vested as of June 28, 2015 22,592,500 $ 0.01 |
Schedule of warrants outstanding | Grant Date Warrants Granted Exercise Price Outstanding as of 6/28/15 Expiration Date Term Avidbank- Line of Credit 3/4/2010 1,000,000 $ 0.10 1,000,000 3/3/2016 6 years Total Warrants 1,000,000 1,000,000 |
Organization and Operations (De
Organization and Operations (Detail Textuals) $ in Thousands | Nov. 03, 2014USD ($) | Jun. 28, 2015USD ($)Employee | Jun. 29, 2014USD ($) | Jun. 28, 2015USD ($)ft²Employee | Jun. 29, 2014USD ($) | Sep. 28, 2014USD ($) | Sep. 29, 2013USD ($) |
Organization And Operations [Line Items] | |||||||
Leased facility (in Square Feet) | ft² | 93,733 | ||||||
Entity number of full-time equivalent employees | Employee | 82 | 82 | |||||
Cash | $ 885 | $ 909 | $ 885 | $ 909 | $ 1,685 | $ 882 | |
Working capital surplus | 5,400 | 5,400 | $ 6,500 | ||||
Line of credit facility, amount outstanding | 550 | 550 | |||||
Working line of credit | 1,000 | 1,000 | |||||
Net loss | (1,014) | (399) | $ (202) | (554) | |||
Percentage of increase in revenues | 5.70% | ||||||
Increase in revenue | $ 400 | ||||||
Revenues | $ 2,312 | $ 1,858 | 7,814 | $ 7,394 | |||
Increase in backlog amount | 2,000 | ||||||
Applied Optics Center | |||||||
Organization And Operations [Line Items] | |||||||
Percent of revenue contribution | 39.80% | ||||||
Amount of revenue contribution | $ 3,000 | ||||||
Percentage of decrease in revenues | (35.30%) | ||||||
Decrease in revenues | $ (2,600) | ||||||
Increased general and administrative costs | 600 | ||||||
Increase in backlog amount | $ 2,800 |
Organization and Operations (21
Organization and Operations (Detail Textuals 1) - USD ($) | Nov. 01, 2015 | May. 15, 2015 | Jul. 22, 2015 | May. 26, 2015 |
Organization And Operations [Line Items] | ||||
Reverse stock split ratio | not less than 1:400 nor more than 1:600 | |||
Subsequent Event | ||||
Organization And Operations [Line Items] | ||||
Reverse stock split ratio | 1:600 | |||
Period for OTCQB company granted | 180 days | |||
Threshold limit of closing bid price | $ 0.01 | |||
Nightforce Optics, Inc. | Supply Agreement | ||||
Organization And Operations [Line Items] | ||||
Aggregate annual minimum order value in 2015 | $ 3,000,000 | |||
Aggregate annual minimum order value in 2016 | $ 3,900,000 | |||
Term of agreement | 2 years | |||
Extension to initial term of agreement | 1 year | |||
Forecasted volumes to initial term of agreement | 3 years |
Accounting Policies (Details)
Accounting Policies (Details) - USD ($) $ in Thousands | Jun. 28, 2015 | Sep. 28, 2014 |
Accounting Policies [Abstract] | ||
Raw Material | $ 4,596 | $ 5,136 |
Work in Process | 2,729 | 1,854 |
Finished Goods | 797 | 265 |
Gross Inventory | 8,122 | 7,255 |
Less: Inventory Reserves | (1,345) | (1,345) |
Net Inventory | $ 6,777 | $ 5,910 |
Accounting Policies (Details 1)
Accounting Policies (Details 1) - Fair value on recurring basis None in scaling factor is -9223372036854775296 | Jun. 28, 2015USD ($) |
Level 1 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |
Derivatives Liabilities - Long Term | |
Level 2 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |
Derivatives Liabilities - Long Term | |
Level 3 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |
Derivatives Liabilities - Long Term |
Accounting Policies (Detail Tex
Accounting Policies (Detail Textuals) - USD ($) | Nov. 03, 2014 | Oct. 24, 2011 | Jun. 28, 2015 | Jun. 29, 2014 | Jun. 28, 2015 | Jun. 29, 2014 | Sep. 28, 2014 |
Accounting Policies [Line Items] | |||||||
Net increase (decrease) inventory | $ (73,000) | $ 867,000 | |||||
Convertible notes payable | $ 1,600,000 | 1,600,000 | |||||
Derivative liabilities | $ 6,100,000 | $ 6,100,000 | |||||
Common stock convertible conversion price | $ 0.0025 | $ 0.0025 | |||||
Conversion rate market price current | $ 0.01 | $ 0.01 | |||||
Revenue recognized for milestones | $ 0 | $ 0 | |||||
Customer advances and deposits | $ 1,400,000 | 1,400,000 | |||||
Short term customer advance deposits for next twelve months | 1,183,000 | 1,183,000 | $ 1,072,000 | ||||
Long term customer advance deposits after March 2016 | $ 194,000 | $ 194,000 | $ 982,000 | ||||
Identified intangible assets | |||||||
Unamortized intangible assets | $ 0 | ||||||
Liquidation of customer deposit | $ 700,000 | ||||||
L-3 Communications Applied Optics Products Line ("Purchased Assets") | |||||||
Accounting Policies [Line Items] | |||||||
Net increase (decrease) inventory | 940,000 | ||||||
Identified intangible assets | $ 342,000 | ||||||
Depreciation method | less than one year | ||||||
Minimum | |||||||
Accounting Policies [Line Items] | |||||||
Delivery period | 3 months | ||||||
Maximum | |||||||
Accounting Policies [Line Items] | |||||||
Delivery period | 36 months | ||||||
General Dynamics | |||||||
Accounting Policies [Line Items] | |||||||
Contract amount in milestone event | $ 8,000,000 | ||||||
Maximum amount of invoices for milestone event | $ 3,900,000 | ||||||
Series A Preferred Stock | |||||||
Accounting Policies [Line Items] | |||||||
Dividend on preferred stock recognized | $ 0 | $ 6,400,000 | |||||
Antidilutive securities excluded from computation of earnings per share, amount | 1,001 | 1,001 | 1,001 | 1,001 | |||
Stock Options | |||||||
Accounting Policies [Line Items] | |||||||
Antidilutive securities excluded from computation of earnings per share, amount | 62,857,649 | 62,912,649 | 62,857,649 | 62,912,649 | |||
Warrants | |||||||
Accounting Policies [Line Items] | |||||||
Antidilutive securities excluded from computation of earnings per share, amount | 1,000,000 | 1,000,000 | 1,000,000 | 1,000,000 | |||
Series B Preferred Stock | |||||||
Accounting Policies [Line Items] | |||||||
Dividend on preferred stock recognized | $ 0 | $ 6,400,000 | |||||
Antidilutive securities excluded from computation of earnings per share, amount | 994 | 994 |
Purchase of Applied Optics Pr25
Purchase of Applied Optics Products Line (Details) - Nov. 03, 2014 - Applied Optics Product Line - USD ($) | Total |
Business Acquisition [Line Items] | |
Fixed Assets | $ 2,064,700 |
Inventory | 940,100 |
Prepaid Assets/Other | 47,100 |
Liabilities | (270,700) |
Net Assets Acquired | 2,781,200 |
Intangible Asset: | |
Customer Contracts/Backlog | 342,200 |
Total Assets Acquired | 3,123,400 |
Less: Cash Consideration | (1,013,100) |
Gain on Bargain Purchase | $ 2,110,300 |
Purchase of Applied Optics Pr26
Purchase of Applied Optics Products Line (Details 2) - L-3 Communications Applied Optics Products Line ("Purchased Assets") - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 28, 2015 | Jun. 29, 2014 | Jun. 28, 2015 | Jun. 29, 2014 | |
Business Acquisition [Line Items] | ||||
Revenues | $ 2,381 | $ 2,548 | $ 7,883 | $ 10,375 |
Net Income (Loss) applicable to common shareholders | $ (1,363) | $ (1,548) | $ (6,992) | $ (3,560) |
Diluted earnings per share (in dollars per share) | $ (0.01) | $ (0.01) | $ (0.04) | $ (0.02) |
Weighted Average Shares Outstanding (in shares) | 172,320,536 | 170,913,943 | 171,382,807 | 162,949,533 |
Purchase of Applied Optics Pr27
Purchase of Applied Optics Products Line (Detail Textuals) - USD ($) | Nov. 03, 2014 | Jun. 28, 2015 | Sep. 28, 2014 |
Business Acquisition [Line Items] | |||
Working capital surplus | $ 5,400,000 | $ 6,500,000 | |
L-3 Communications Applied Optics Products Line ("Purchased Assets") | |||
Business Acquisition [Line Items] | |||
Purchase price paid | $ 1,013,100 | ||
Liabilities assumed | 270,700 | ||
Working capital surplus | 213,100 | ||
Advance from accredited investors | $ 800,000 | ||
Approximate percentage of net carrying value of assets for fair value appraisal | 73.00% | ||
Acquisition-related costs | $ 40,200 |
Intangible Assets (Details)
Intangible Assets (Details) - Applied Optics Product Line | Nov. 03, 2014USD ($) |
Assets: | |
Current assets, consisting primarily of inventory of $940.1 thousand and prepaid assets of $47.1 thousand | $ 987,200 |
Identifiable intangible assets | 342,200 |
Other non-current assets, principally property and equipment | 2,064,700 |
Total assets | 3,394,100 |
Liabilities: | |
Current liabilities, consisting of accounts payable of $119.4 thousand and accrued liabilities of $151.3 thousand | (270,700) |
Total Assets Acquired | $ 3,123,400 |
Intangible Assets (Parenthetica
Intangible Assets (Parentheticals) (Details) - Applied Optics Product Line | Nov. 03, 2014USD ($) |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Inventory | $ 940,100 |
Prepaid assets | 47,100 |
Accounts payable | 119,400 |
Accrued liabilities | $ 151,300 |
Intangible Assets (Details 1)
Intangible Assets (Details 1) - Jun. 28, 2015 - Customer backlog - USD ($) | Total | Total |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | $ 342,200 | |
Unamortized Balance | ||
Dec14 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | ||
Unamortized Balance | $ 342,200 | $ 342,200 |
Jan15 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | 57,000 | |
Unamortized Balance | 285,200 | 285,200 |
Feb15 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | 57,000 | |
Unamortized Balance | 228,200 | 228,200 |
Mar15 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | 57,000 | |
Unamortized Balance | 171,200 | 171,200 |
Apr15 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | 57,000 | |
Unamortized Balance | 114,200 | 114,200 |
May15 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | 57,000 | |
Unamortized Balance | $ 57,200 | 57,200 |
Jun15 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | $ 57,200 | |
Unamortized Balance | ||
COS | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | $ 145,500 | $ 291,100 |
COS | Dec-14 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | ||
COS | Jan-15 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | $ 48,500 | |
COS | Feb-15 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | 48,500 | |
COS | Mar-15 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | 48,500 | |
COS | Apr-15 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | 48,500 | |
COS | May-15 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | 48,500 | |
COS | Jun-15 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | 48,600 | |
G&A | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | $ 25,500 | $ 51,100 |
G&A | Dec-14 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | ||
G&A | Jan-15 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | $ 8,500 | |
G&A | Feb-15 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | 8,500 | |
G&A | Mar-15 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | 8,500 | |
G&A | Apr-15 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | 8,500 | |
G&A | May-15 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | 8,500 | |
G&A | Jun-15 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Total Amortization | $ 8,600 |
Intangible Assets (Detail Textu
Intangible Assets (Detail Textuals) - Nov. 03, 2014 - Applied Optics Product Line - USD ($) | Total |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Purchase price paid | $ 1,013,100 |
Liabilities assumed | $ 270,700 |
Intangible Assets (Detail Tex32
Intangible Assets (Detail Textuals 1) - Jun. 28, 2015 - USD ($) | Total | Total | Total |
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Fair value of intangible assets | $ 0 | ||
Customer backlog | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | $ 342,200 | ||
Unamortized Balance | |||
Customer backlog | Dec-14 | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | |||
Unamortized Balance | $ 342,200 | $ 342,200 | $ 342,200 |
Customer backlog | Jan-15 | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | 57,000 | ||
Unamortized Balance | 285,200 | 285,200 | 285,200 |
Customer backlog | Feb-15 | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | 57,000 | ||
Unamortized Balance | 228,200 | 228,200 | 228,200 |
Customer backlog | Mar-15 | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | 57,000 | ||
Unamortized Balance | 171,200 | 171,200 | 171,200 |
Customer backlog | Apr-15 | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | 57,000 | ||
Unamortized Balance | 114,200 | 114,200 | 114,200 |
Customer backlog | May-15 | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | 57,000 | ||
Unamortized Balance | $ 57,200 | $ 57,200 | 57,200 |
Customer backlog | Jun-15 | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | $ 57,200 | ||
Unamortized Balance | |||
Manufacturing cost of sale | Customer backlog | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | $ 145,500 | $ 291,100 | |
Manufacturing cost of sale | Customer backlog | Dec-14 | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | |||
Manufacturing cost of sale | Customer backlog | Jan-15 | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | $ 48,500 | ||
Manufacturing cost of sale | Customer backlog | Feb-15 | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | 48,500 | ||
Manufacturing cost of sale | Customer backlog | Mar-15 | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | 48,500 | ||
Manufacturing cost of sale | Customer backlog | Apr-15 | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | 48,500 | ||
Manufacturing cost of sale | Customer backlog | May-15 | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | 48,500 | ||
Manufacturing cost of sale | Customer backlog | Jun-15 | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | 48,600 | ||
General and administrative expense | Customer backlog | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | 25,500 | $ 51,100 | |
General and administrative expense | Customer backlog | Dec-14 | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | |||
General and administrative expense | Customer backlog | Jan-15 | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | $ 8,500 | ||
General and administrative expense | Customer backlog | Feb-15 | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | 8,500 | ||
General and administrative expense | Customer backlog | Mar-15 | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | 8,500 | ||
General and administrative expense | Customer backlog | Apr-15 | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | 8,500 | ||
General and administrative expense | Customer backlog | May-15 | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | 8,500 | ||
General and administrative expense | Customer backlog | Jun-15 | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | 8,600 | ||
Applied Optics Product Line | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Fair value of intangible assets | 342,200 | ||
Method of amortization of intangible assets | straight line basis | ||
Amortizable intangible assets | $ 57,000 | ||
Unamortized Balance | 0 | $ 0 | 0 |
Identifiable intangible assets amortized period | 15 years | ||
Applied Optics Product Line | Manufacturing cost of sale | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | 48,500,000 | 291,100,000 | |
Applied Optics Product Line | General and administrative expense | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortizable intangible assets | $ 8,500,000 | $ 51,100,000 |
Debt Financing (Detail Textuals
Debt Financing (Detail Textuals) - Jun. 05, 2015 - Sileas Corp. - Longview Fund, L.P - Secured Note - USD ($) | Total |
Debt Instrument [Line Items] | |
Principal amount | $ 18,022,328.60 |
Maximum beneficial ownership | 9.99% |
Debt Financing (Detail Textua34
Debt Financing (Detail Textuals 1) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||
May. 22, 2014 | Jun. 28, 2015 | Jun. 29, 2014 | Jun. 28, 2015 | Jun. 29, 2014 | |
Debt Instrument [Line Items] | |||||
Line of credit facility, maximum borrowing capacity | $ 1,000,000 | $ 1,000,000 | |||
Line of credit facility, amount outstanding | 550,000 | 550,000 | |||
Revolving Credit Facility | Avidbank | |||||
Debt Instrument [Line Items] | |||||
Line of credit facility, maximum borrowing capacity | $ 1,000,000 | ||||
Line of credit facility, expiration date | May 21, 2016 | ||||
Line of credit facility maturity term | 2 years | ||||
Line of credit facility, interest rate description | greater of 7.0% and the then in effect prime rate plus 2.5% | ||||
Line of credit facility renewal fees due on the one year anniversary of the date of the loan agreement | 5,000 | ||||
Line of credit facility, amount outstanding | 550,000 | 550,000 | |||
Interest expense | $ 10,000 | $ 6,000 | 20,000 | $ 16,000 | |
Revolving Credit Facility | Avidbank | Minimum | |||||
Debt Instrument [Line Items] | |||||
Interest expense | $ 10,000 |
Debt Financing (Detail Textua35
Debt Financing (Detail Textuals 2) - USD ($) | May. 15, 2015 | Nov. 17, 2014 | Jun. 28, 2015 | Jun. 28, 2015 | Sep. 28, 2014 |
Debt Instrument [Line Items] | |||||
Proceeds from convertible notes issued | $ 1,560,000 | ||||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 | ||
Reverse stock split ratio | not less than 1:400 nor more than 1:600 | ||||
Convertible promissory notes ("Notes") | |||||
Debt Instrument [Line Items] | |||||
Principal amount | $ 1,560,000 | $ 1,560,000 | |||
Subscription Agreement (the "Agreement") | Convertible promissory notes ("Notes") | |||||
Debt Instrument [Line Items] | |||||
Principal amount | $ 2,100,000 | ||||
Interest rate on notes | 12.00% | ||||
Maturity period of notes | 2 years | ||||
Common stock, par value (in dollars per share) | $ 0.001 | ||||
Conversion price of stock per share (in dollars per share) | $ 0.0025 | ||||
Prepayment terms | All or part of the then remaining principal amount of the notes may be prepaid at any time at a price equal to 125% of the sum of the remaining principal amount of the notes to be prepaid plus all accrued and unpaid interest thereon. | ||||
Prepayment percentage of principal and unpaid interest | 125.00% | ||||
Reverse stock split ratio | 1:350 | ||||
Reverse Stock Split maximum effective days | 90 days | ||||
Debt issuance cost | 74,000 | ||||
Placement Fees | 10,000 | ||||
Amortized interest expense related to debt issuance costs | $ 3,000 | $ 146,000 | |||
Subscription Agreement (the "Agreement") | Convertible promissory notes ("Notes") | Maximum | |||||
Debt Instrument [Line Items] | |||||
Maximum beneficial ownership | 3.33% | ||||
Subscription Agreement (the "Agreement") | Convertible promissory notes ("Notes") | Accredited investors | |||||
Debt Instrument [Line Items] | |||||
Principal amount | $ 1,550,000 | ||||
Subscription Agreement (the "Agreement") | Convertible promissory notes ("Notes") | Placement Agency | |||||
Debt Instrument [Line Items] | |||||
Principal amount | $ 10,000 |
Debt Financing (Details Textual
Debt Financing (Details Textuals 3) - USD ($) | 9 Months Ended | |||
Jun. 28, 2015 | May. 27, 2015 | Mar. 26, 2015 | Sep. 28, 2014 | |
Debt Instrument [Line Items] | ||||
Conversion price (in dollars per share) | $ 0.0025 | |||
Series B Preferred Stock | ||||
Debt Instrument [Line Items] | ||||
Preferred stock, shares authorized | 1,010 | 1,010 | 1,010 | |
Stated value of each share | $ 1,629 | |||
Conversion price (in dollars per share) | $ 1,629 | $ 0.0025 | $ 0.0025 | |
Stock issued upon conversion of debt | 1,000 | |||
Convertible promissory note | ||||
Debt Instrument [Line Items] | ||||
Principal amount | $ 1,560,000 |
Stock Based Compensation (Detai
Stock Based Compensation (Details) - Jun. 28, 2015 - $ / shares | Total |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Shares Granted | 73,751,649 |
Shares Outstanding As of 6/28/15 | 62,857,649 |
Date of Grant - 03/30/09 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Date of Grant | Mar. 30, 2009 |
Shares Granted | 1,414,649 |
Exercise Price | $ 0.15 |
Shares Outstanding As of 6/28/15 | 1,414,649 |
Expiration Date | Mar. 29, 2016 |
Vesting Period | 3 years |
Date of Grant - 05/14/09 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Date of Grant | May 14, 2009 |
Shares Granted | 1,267,000 |
Exercise Price | $ 0.15 |
Shares Outstanding As of 6/28/15 | 1,073,000 |
Expiration Date | May 13, 2016 |
Vesting Period | 4 years |
Date of Grant - 12/09/11 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Date of Grant | Dec. 9, 2011 |
Shares Granted | 46,070,000 |
Exercise Price | $ 0.01 |
Shares Outstanding As of 6/28/15 | 35,370,000 |
Expiration Date | Dec. 8, 2018 |
Vesting Period | 4 years |
Date of Grant - 12/19/13 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Date of Grant | Dec. 19, 2013 |
Shares Granted | 25,000,000 |
Exercise Price | $ 0.01 |
Shares Outstanding As of 6/28/15 | 25,000,000 |
Expiration Date | Dec. 18, 2020 |
Vesting Period | 4 years |
Stock Based Compensation (Det38
Stock Based Compensation (Details 1) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended | ||
Jun. 28, 2015 | Jun. 29, 2014 | Sep. 28, 2014 | Sep. 29, 2013 | |
Number of Shares Remaining Options | ||||
Granted | 73,751,649 | |||
Outstanding - Ending Balance | 62,857,649 | |||
Incentive Stock Option Plan | ||||
Number of Shares Remaining Options | ||||
Outstanding - Beginning Balance | 62,911,649 | 48,247,649 | 48,247,649 | |
Granted | 25,000,000 | 25,000,000 | ||
Forfeited | (54,000) | (5,336,000) | ||
Exercised | (5,000,000) | |||
Outstanding - Ending Balance | 62,857,649 | 62,911,649 | 48,247,649 | |
Exercisable | 40,265,149 | 20,201,649 | ||
Weighted Average Fair Value | ||||
Outstanding - Beginning Balance | ||||
Granted | $ 0.01 | |||
Forfeited | ||||
Exercised | $ 0.01 | |||
Outstanding - Ending Balance | ||||
Exercisable | ||||
Weighted Average Life (Years) | ||||
Outstanding | 2 years 6 months 22 days | 3 years 4 months 28 days | 3 years 6 months 22 days | |
Granted | 5 years 2 months 19 days | |||
Exercisable | 1 year 8 months 8 days | 1 year 9 months 4 days | ||
Aggregate Value | ||||
Outstanding - Beginning Balance | ||||
Granted | $ 200 | |||
Forfeited | ||||
Exercised | ||||
Outstanding - Ending Balance | ||||
Exercisable |
Stock Based Compensation (Det39
Stock Based Compensation (Details 2) - 2009 Stock Option Plan - $ / shares | 9 Months Ended | 12 Months Ended |
Jun. 28, 2015 | Sep. 28, 2014 | |
Number of Non- vested Shares Subject to Options | ||
Non-vested, Beginning balance | 42,710,000 | 30,547,500 |
Non-vested granted | 25,000,000 | |
Vested | (20,063,500) | (7,501,500) |
Forfeited | (54,000) | (5,336,000) |
Non-vested, Ending balance | 22,592,500 | 42,710,000 |
Weighted - Average Grant- Date Fair Value | ||
Non-vested Options, Beginning balance | $ 0.01 | $ 0.01 |
Non-vested granted | 0.01 | |
Vested | $ 0.01 | $ 0.01 |
Forfeited | ||
Non-vested Options, Ending balance | $ 0.01 | $ 0.01 |
Stock Based Compensation (Det40
Stock Based Compensation (Details 3) - Jun. 28, 2015 - $ / shares | Total |
Class of Warrant or Right [Line Items] | |
Warrants Granted | 1,000,000 |
Outstanding as of 6/28/15 | 1,000,000 |
Avidbank- Line Of Credit | |
Class of Warrant or Right [Line Items] | |
Grant Date | Mar. 4, 2010 |
Warrants Granted | 1,000,000 |
Exercise price of warrants | $ 0.10 |
Outstanding as of 6/28/15 | 1,000,000 |
Expiration Date | Mar. 3, 2016 |
Term | 6 years |
Stock Based Compensation (Det41
Stock Based Compensation (Detail Textuals) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Nov. 19, 2014 | Jun. 28, 2015 | Jun. 29, 2014 | Jun. 28, 2015 | Jun. 29, 2014 | Sep. 28, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock option compensation expense | $ 25 | $ 29 | $ 116 | $ 76 | ||
Number of shares remaining option, granted | 73,751,649 | |||||
Expenses directly attributable to the early vesting shares | $ 57 | |||||
Merrick Okamoto | Stock Options | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of Non- vested Shares Subject to Options, Vested | 12,500 | |||||
2009 Stock Option Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of Non- vested Shares Subject to Options, Vested | 20,063,500 | 7,501,500 | ||||
Unrecognized compensation cost related to non-vested share based compensation | $ 159 | $ 159 | ||||
Incentive Stock Option Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of shares remaining option, granted | 25,000,000 | 25,000,000 |
Stockholders Equity (Detail Tex
Stockholders Equity (Detail Textuals) - USD ($) | May. 15, 2015 | Feb. 11, 2014 | Jul. 22, 2015 | May. 27, 2015 | Mar. 29, 2015 | Mar. 24, 2014 | Mar. 19, 2013 | Feb. 21, 2012 | Jun. 28, 2015 | Jun. 28, 2015 | Sep. 28, 2014 | Apr. 03, 2015 | Mar. 26, 2015 | Nov. 17, 2014 | Sep. 29, 2013 | Apr. 01, 2012 |
Schedule Of Stockholders Equity [Line Items] | ||||||||||||||||
Common stock, shares outstanding | 174,913,943 | 174,913,943 | 170,913,943 | 157,346,607 | ||||||||||||
Stated value of preferred stock converted | $ 4,887,000 | |||||||||||||||
Common stock convertible conversion price | $ 0.0025 | $ 0.0025 | ||||||||||||||
Common stock, shares, issued | 174,913,943 | 174,913,943 | 170,913,943 | |||||||||||||
Common stock, shares authorized | 2,000,000,000 | 2,000,000,000 | 2,000,000,000 | |||||||||||||
Reverse stock split ratio | not less than 1:400 nor more than 1:600 | |||||||||||||||
Subsequent Event | ||||||||||||||||
Schedule Of Stockholders Equity [Line Items] | ||||||||||||||||
Reverse stock split ratio | 1:600 | |||||||||||||||
Common Stock | ||||||||||||||||
Schedule Of Stockholders Equity [Line Items] | ||||||||||||||||
Common stock, shares outstanding | 157,346,607 | |||||||||||||||
Common stock issued upon conversion of preferred stock | 4,000,000 | |||||||||||||||
Common Stock | Former director | ||||||||||||||||
Schedule Of Stockholders Equity [Line Items] | ||||||||||||||||
Number of stock options exercised | 5,000,000 | |||||||||||||||
Number of stock issued | 3,567,336 | |||||||||||||||
Stock issuance price per share | $ 0.01 | |||||||||||||||
Series A Preferred Stock | ||||||||||||||||
Schedule Of Stockholders Equity [Line Items] | ||||||||||||||||
Stated value of preferred stock converted | $ 6,860 | |||||||||||||||
Common stock convertible conversion price | $ 0.0025 | |||||||||||||||
Preferred stock, shares issued | 1,001 | 1,001 | 1,001 | |||||||||||||
Number of preferred stock shares authorized | 1,027 | 1,027 | ||||||||||||||
Preferred stock, shares authorized | 5,000 | 5,000 | 5,000 | |||||||||||||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 | |||||||||||||
Preferred stock, shares outstanding | 1,001 | 1,001 | 1,001 | |||||||||||||
Conversion price per share as adjusted from time to time of stock | $ 0.15 | $ 0.15 | ||||||||||||||
Conversion price per share reset | $ 0.01 | $ 0.01 | $ 0.0025 | |||||||||||||
Rate of cumulative dividends | 6.00% | |||||||||||||||
Dividends arrears in exchange for increase in stated value | $ 884,000 | |||||||||||||||
Increase in stated value of preferred stock | $ 6,860 | |||||||||||||||
Dividends, preferred stock | $ 1,500,000 | $ 1,500,000 | ||||||||||||||
Common stock, voting rights | one vote | |||||||||||||||
Series B Preferred Stock | ||||||||||||||||
Schedule Of Stockholders Equity [Line Items] | ||||||||||||||||
Number of preferred stock converted | 6 | |||||||||||||||
Stated value of preferred stock converted | $ 10,000 | |||||||||||||||
Common stock convertible conversion price | $ 1,629 | $ 0.0025 | $ 0.0025 | |||||||||||||
Preferred stock, shares issued | 994 | 994 | 0 | |||||||||||||
Preferred stock, shares authorized | 1,010 | 1,010 | 1,010 | 1,010 | ||||||||||||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | ||||||||||||
Preferred stock, shares outstanding | 994 | 994 | 0 | |||||||||||||
Dividends, preferred stock | $ 4,900,000 | $ 4,900,000 | ||||||||||||||
Preferred stock issued in exchange for convertible notes | 1,000 | |||||||||||||||
Alpha Capital Anstalt | Series A Preferred Stock | ||||||||||||||||
Schedule Of Stockholders Equity [Line Items] | ||||||||||||||||
Number of preferred stock converted | 7.29 | 7.29 | 7.29 | 14.58 | ||||||||||||
Stated value of preferred stock converted | $ 6,860 | $ 6,860 | $ 6,860 | $ 6,860 | ||||||||||||
Common stock issued upon conversion of preferred stock | 8,333 | 8,333 | 5,000,000 | 10,000,000 | ||||||||||||
Common stock convertible conversion price | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | ||||||||||||
Conversion of stock, amount issued | $ 50,000 | $ 50,000 | $ 50,000 | $ 100,000 | ||||||||||||
Common stock, shares, issued | 5,000,000 | |||||||||||||||
Dividends preferred stock waived | $ 213,000 | |||||||||||||||
Conversion price per share reset | $ 0.01 |
Stockholders Equity (Detail T43
Stockholders Equity (Detail Textuals 1) - USD ($) | Apr. 03, 2015 | Jun. 28, 2015 | Jun. 28, 2015 | Jun. 26, 2015 | May. 27, 2015 | Mar. 26, 2015 | Sep. 28, 2014 |
Stockholders Equity [Line Items] | |||||||
Conversion price (in dollars per share) | $ 0.0025 | $ 0.0025 | |||||
Market price of common stock | $ 0.0066 | ||||||
Convertible debt | |||||||
Stockholders Equity [Line Items] | |||||||
Principal amount | $ 1,560,000 | $ 1,560,000 | |||||
Series A Preferred Stock | |||||||
Stockholders Equity [Line Items] | |||||||
Conversion price (in dollars per share) | $ 0.0025 | ||||||
Preferred stock with beneficial conversion feature | 75.5 | 75.5 | 75.5 | ||||
Dividend on preferred stock recognized | $ 1,500,000 | $ 1,500,000 | |||||
Preferred stock, shares outstanding | 1,001 | 1,001 | 1,001 | ||||
Additional retained earnings adjustment for dividend | $ 10,400,000 | ||||||
Preferred stock, shares authorized | 5,000 | 5,000 | 5,000 | ||||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 | ||||
Series B Preferred Stock | |||||||
Stockholders Equity [Line Items] | |||||||
Conversion price (in dollars per share) | $ 1,629 | $ 0.0025 | $ 0.0025 | ||||
Dividend on preferred stock recognized | $ 4,900,000 | $ 4,900,000 | |||||
Preferred stock, shares outstanding | 994 | 994 | 0 | ||||
Preferred stock, shares authorized | 1,010 | 1,010 | 1,010 | 1,010 | |||
Share price | $ 1,629 | ||||||
Stock issued upon conversion of debt | 1,000 | ||||||
Market price of common stock | $ 0.01 | $ 0.01 | |||||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | |||
Sileas Corp. | Series A Preferred Stock | |||||||
Stockholders Equity [Line Items] | |||||||
Preferred stock, shares outstanding | 926 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | Jul. 14, 2015 | May. 15, 2015 | Jul. 22, 2015 | Jun. 28, 2015 | Sep. 28, 2014 |
Subsequent Event [Line Items] | |||||
Reverse stock split ratio | not less than 1:400 nor more than 1:600 | ||||
Par value, common stock (in dollars per share) | $ 0.001 | $ 0.001 | |||
Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Reverse stock split ratio | 1:600 | ||||
Par value, common stock (in dollars per share) | $ 0.001 | ||||
Subsequent Event | Independent board member | |||||
Subsequent Event [Line Items] | |||||
Monthly directors' compensation | $ 1,000 | ||||
Stipend per meeting attended | $ 500 | ||||
Number of shares granted | 21,000 | ||||
Number of shares vested on grant date | 7,000 | ||||
Additional number of shares granted, vesting immediately | 5,000 |