Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Mar. 31, 2014 | Jun. 20, 2014 | |
Document and Entity Information [Abstract] | ' | ' |
Entity Registrant Name | 'BOLDFACE GROUP, INC. | ' |
Entity Central Index Key | '0001423107 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--06-30 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 31-Mar-14 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Document Fiscal Year Focus | '2014 | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Common Stock Shares Outstanding | ' | 1,569,979 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (USD $) | Mar. 31, 2014 | Jun. 30, 2013 |
Current assets: | ' | ' |
Cash and cash equivalents | $739,297 | $388,892 |
Accounts receivable, net of reserves for discounts and allowances | 36,461 | 100,087 |
Due from factor, net | 253,200 | 164,090 |
Inventory (net of reserve of $495,000 and $365,772, as of March 31, 2014 and June 30, 2013, respectively) | 1,712,846 | 1,948,908 |
Prepaid inventory | 289,090 | 258,531 |
Prepaid expenses and other current assets | 40,851 | 89,786 |
Prepaid royalty | 5,590 | 378,960 |
Current portion of deferred financing costs, net | 37,394 | 29,899 |
Total current assets | 3,114,729 | 3,359,153 |
Property and equipment, net | 496,463 | 669,033 |
Deferred financing costs, net | 120,166 | 328,893 |
License acquisition costs | 18,376 | 24,504 |
Total assets | 3,749,734 | 4,381,583 |
Current liabilities: | ' | ' |
Deferred revenue | 50,568 | ' |
Accounts payable | 4,273,880 | 2,481,852 |
Accrued expenses and other current liabilities | 1,796,800 | 806,553 |
Current portion of convertible debt, net of debt discount ($145,729 and $116,524, as of March 31, 2014 and June 30, 2013, respectively) | 197,128 | 23,476 |
Bridge note, net of debt discount ($231,349 and $0, as of March 31, 2014 and June 30, 2013, respectively) | 888,651 | ' |
Due to Gold Grenade, LLC (related party) | 234,550 | ' |
Total current liabilities | 7,441,577 | 3,311,881 |
Long-Term Liabilities | ' | ' |
Convertible debt, net of debt discount ($0 and $1,281,760, as of March 31, 2014 and June 30, 2013, respectively) | ' | 258,240 |
Derivative liability | 119,559 | 1,660,440 |
Total Long-Term Liabilities | 119,559 | 1,918,680 |
Total Liabilities | 7,561,136 | 5,230,561 |
Preferred stock, $.001 par value, 10,000,000 shares authorized, 3,906 and 0 issued and outstanding as of March 31, 2014 and June 30, 2013 respectively | 3,906,004 | ' |
Commitments and Contingencies (Note 8) | ' | ' |
Shareholders' deficit: | ' | ' |
Common stock, $.001 par value, 3,000,000 shares authorized, 1,575,250 and 1,553,015 shares issued as of March 31, 2014 and June 30, 2013 respectively | 1,575 | 155,301 |
Treasury stock, at cost - 9,997 and 9,997 shares as of March 31, 2014 and June 30, 2013, respectively | -228,284 | -228,284 |
Additional paid in capital | 7,437,579 | 6,841,822 |
Accumulated deficit | -14,928,276 | -7,617,817 |
Total shareholders' deficit | -7,717,406 | -848,978 |
Total liabilities and shareholders' deficit | $3,749,734 | $4,381,583 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Parenthetical) (USD $) | Mar. 31, 2014 | Jun. 30, 2013 |
Balance Sheets [Abstract] | ' | ' |
Inventory net of reserve | $495,000 | $365,772 |
Debt discount on convertible debt current | 145,729 | 116,524 |
Debt discount on bridge note current | 231,349 | 0 |
Debt discount on convertible debt non-current | $0 | $1,281,760 |
Preferred stock, par value | $0.00 | $0.00 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, issued | 3,906 | 0 |
Preferred stock, outstanding | 3,906 | 0 |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares authorized | 3,000,000 | 3,000,000 |
Common stock, shares issued | 1,575,250 | 1,553,015 |
Treasury stock at cost, shares | 9,997 | 9,997 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Operations (Unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | |
Revenues | ' | ' | ' | ' |
Gross revenues | $752,877 | $3,608,245 | $4,273,852 | $5,362,057 |
Discounts | 439,105 | 584,983 | 1,221,625 | 812,526 |
Revenues, net of discounts | 313,772 | 3,023,262 | 3,052,227 | 4,549,531 |
Cost of Goods Sold | ' | ' | ' | ' |
Cost of goods sold | 615,942 | 1,332,377 | 2,516,153 | 2,126,773 |
Gross Profit | -302,170 | 1,690,885 | 536,074 | 2,422,758 |
Operating expenses: | ' | ' | ' | ' |
Selling expenses | 18,843 | 243,463 | 369,359 | 585,241 |
Research and development | 3,006 | 13,909 | 14,195 | 36,921 |
Royalty expense | 419,036 | 157,895 | 815,370 | 480,704 |
Professional fees | 337,222 | 818,666 | 1,004,927 | 1,427,389 |
General and administrative expenses | 721,305 | 817,995 | 2,418,327 | 2,210,174 |
Depreciation and amortization expense | 126,843 | 671,709 | 361,812 | 745,885 |
Product development fee - related party | 140,000 | 210,000 | 640,000 | 622,700 |
Total Operating Expense | 1,766,255 | 2,933,637 | 5,623,990 | 6,109,014 |
Loss from operations | -2,068,425 | -1,242,752 | -5,087,916 | -3,686,256 |
Other (income) / expenses: | ' | ' | ' | ' |
Interest expense, net of interest income | 388,073 | 661,838 | 1,170,555 | 957,973 |
Loss from debt extinguishment | 2,760,640 | ' | 2,760,640 | ' |
Derivative liability (gain) / loss | -462,726 | -3,646,420 | -1,708,651 | -3,299,793 |
Net (loss) / income | -4,754,412 | 1,741,830 | -7,310,460 | -1,344,436 |
Preferred Dividend | 78,126 | ' | 78,126 | ' |
Net (loss) / income attributable to common shareholders - basic and diluted | ($4,832,538) | $1,741,830 | ($7,388,586) | ($1,344,436) |
Net (loss) / income per share attributable to common shareholders - basic and diluted | ($3.11) | $1.97 | ($4.77) | ($1.54) |
Weighted average number of common shares used in computing - basic and diluted | 1,555,675 | 883,074 | 1,547,820 | 872,201 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $) | 9 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Cash flows from operating activities: | ' | ' |
Net loss | ($7,310,460) | ($1,344,436) |
Adjustments to reconcile net loss tonet cash used in operating activities: | ' | ' |
Stock compensation expense | 472,397 | 452,087 |
Shares issued for services | 46,387 | 253,455 |
Inventory reserves | 129,228 | ' |
Amortization of license acquisition costs | 6,128 | 1,998 |
Amortization of deferred financing costs | 198,836 | 656,623 |
Amortization of debt discount | 753,437 | 551,502 |
Depreciation | 361,811 | 89,262 |
Loss from debt extinguishment | 2,760,640 | ' |
Derivative liability (gain) / loss | -1,708,651 | -3,299,793 |
Change in operating assets and liabilities: | ' | ' |
Accounts receivable | 63,626 | -101,553 |
Due from factor, net | -89,110 | -526,273 |
Prepaid royalty | 373,370 | 380,704 |
License acquisition costs | ' | -8,902 |
Inventory | 106,834 | -1,837,553 |
Deposit | ' | -1,500 |
Prepaid expenses and other current assets | 48,935 | -91,667 |
Prepaid inventory | -30,559 | -65,686 |
Accounts payable | 1,792,028 | 2,144,990 |
Customer deposits | 50,568 | ' |
Accrued expenses and other current liabilities | 990,247 | 433,868 |
Due to Gold Grenade, LLC | 234,550 | -108,475 |
Net cash used in operating activities | -749,758 | -2,421,349 |
Cash flows from investing activities: | ' | ' |
Acquisition of property and equipment | -189,241 | -876,549 |
Net cash used in investing activities | -189,241 | -876,549 |
Cash flows from financing activities: | ' | ' |
Issuance of common stock, net of financing fees | ' | 783,480 |
Purchase of treasury stock and warrants | ' | -125,000 |
Proceeds from short term loans | ' | 1,335,000 |
Paydown of short term loans | ' | -1,335,000 |
Payments of preferred dividends | -78,126 | ' |
Issuance of bridge note | 1,000,000 | ' |
Payments for deferred financing fees in relation to bridge note issuance | -120,405 | ' |
Issuance of convertible debt | 550,000 | 2,605,284 |
Payments for deferred financing fees in relation to convertible debt issuance | -62,065 | ' |
Net cash provided by financing activities | 1,289,404 | 3,263,764 |
Net change in cash and cash equivalents | 350,405 | -34,134 |
Cash at beginning of period | 388,892 | 71,532 |
Cash at end of period | 739,297 | 37,398 |
Supplemental disclosures of cash flow information: | ' | ' |
Interest | 129,539 | 225,078 |
Income Taxes | ' | ' |
Non-cash financing activities: | ' | ' |
Conversion of bridge notes and convertible debt | 1,953,143 | 1,925,030 |
Contribution from shareholders for deferred financing cost | ' | 1,537,940 |
Other non-cash deferred financing fees from issuance of convertible debt | ' | 194,381 |
Fair value of conversion features and warrants issued in connection with equity and debt financing | $224,899 | $5,494,386 |
Formation_and_Nature_of_Busine
Formation and Nature of Business | 9 Months Ended |
Mar. 31, 2014 | |
Formation and Nature of Business [Abstract] | ' |
FORMATION AND NATURE OF BUSINESS | ' |
NOTE 1. FORMATION AND NATURE OF BUSINESS | |
Organization | |
BOLDFACE Group, Inc. (“BLBK”) together with its wholly owned subsidiary BOLDFACE Licensing + Branding (“BLB” and collectively, the “Company”) was incorporated under the laws of the State of Nevada on July 9, 2007. On July 12, 2012, BOLDFACE Acquisition Corp., the Company’s wholly owned subsidiary, merged with and into BLB, with BLB remaining as the surviving entity (the “Merger”). As a result of the Merger, the Company acquired the business of BLB and has continued the existing business operations of BLB as the Company’s wholly owned subsidiary. In connection with the Merger, on August 14, 2012, the Company’s Board of Directors approved a change of the Company’s fiscal year end from September 30 to June 30. | |
For financial reporting purposes, the Merger represented a capital transaction of BLB or a “reverse merger” rather than a business combination, because the sellers of BLB effectively controlled the combined company immediately following the completion of the Merger. As such, BLB was deemed to be the accounting acquirer in the transaction and, consequently, the transaction was treated as a recapitalization of BLB. | |
BLB was incorporated under the laws of the State of Nevada on April 26, 2012. BLB was founded by Ms. Nicole Ostoya, the Company’s Chief Executive Officer, President and a director, and Ms. Robin Coe-Hutshing, a principal shareholder of the Company. Ms. Ostoya and Ms. Coe-Hutshing are beauty industry veterans with over 40 years combined experience in the industry. BLB’s focus is on licensing top tier entertainment and designer brands for opportunities in the beauty, fragrance and personal care markets. BLB contracts to design, manufacture and sell branded color cosmetics, hair preparations, fragrances, home fragrances, skin care, beauty tools, and other beauty and personal care products in multiple channels of distribution. | |
To date, the Company has devoted its efforts to developing, marketing and selling its Kardashian Beauty™ brand in multiple retail channels, developing a line of products that will be marketed under its licenses with Mario Lopez and UGLYDOLL®, evaluating additional license agreements with additional celebrities and brands, and raising additional capital. | |
Basis of Presentation | |
The accompanying condensed consolidated financial statements as of March 31, 2014 and for the three and nine month period ended March 31, 2013 are unaudited, but include all adjustments, consisting of normal recurring entries, which the Company’s management believes to be necessary for a fair presentation of the periods presented. Interim results are not necessarily indicative of results for a full year. Balance sheet amounts as of June 30, 2013 have been derived from the Company’s audited financial statements included in its Form 10-K for the year ended June 30, 2013 filed with the Securities and Exchange Commission (“SEC”) on October 15, 2013. | |
The financial statements included herein have been prepared by the Company pursuant to the rules and regulations of the SEC. Certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the U.S. (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. The financial statements should be read in conjunction with the Company’s audited financial statements in its Form 10-K for the year ended June 30, 2013. The Company’s operating results will continue to fluctuate for the foreseeable future. Therefore, period-to-period comparisons should not be relied upon as predictive of the results in future periods. | |
On May 6, 2014, the Board of Directors of the Company approved a reverse stock split of the Company’s common stock, par value $0.001 per share (“Common Stock”) at a ratio of l00-for-1 (the “Reverse Stock Split”). On May 16, 2014, the Reverse Stock Split became effective with FINRA (the Financial Industry Regulatory Authority) and in the marketplace, whereupon the shares of Common Stock began trading on a split-adjusted basis. The accompanying condensed consolidated financial statements and footnotes have been adjusted to reflect the impact of the Reverse Stock Split on a retroactive basis. | |
Going Concern and Liquidity | |
The accompanying condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. However, the Company’s ability to continue as a going concern is dependent upon the Company’s ability to generate sufficient cash flow from its planned operations to meet its obligations on a timely basis, to raise additional equity and/or debt financing and through its factoring arrangements. In connection with the execution of its business plan, the Company anticipates additional increases in operating expenses and capital expenditures relating to: (i) payments under existing licenses, (ii) investments in inventory for our Kardashian Beauty™ brand; (iii) research and development costs associated with new product offerings, and (iv) management and consulting costs, as well as general administrative expenses, including the costs of being a public company. The Company intends to finance these expenses by raising additional capital and generating sufficient revenues to meet short-term and long-term operating requirements. If additional financings are not available or are not available on acceptable terms, the Company may not be able to take advantage of prospective new business endeavors or opportunities, which could significantly and materially restrict its business operations. The Company currently does not have a specific plan of how it will obtain such funding and/or generate sufficient revenues to meet its operating requirements; however, it anticipates that additional funding will be in the form of equity and/or debt financings and/or additional short-term borrowings. As such, these factors raise substantial doubt as to the Company’s ability to continue as a going concern. The Company continues to operate within its factoring agreement, which automatically renewed on November 21, 2013 for an additional one-year period. | |
The Company’s condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. The Company’s auditors expressed substantial doubt about its ability to continue as a going concern in their audit report dated October 15, 2013, for the period ending June 30, 2013. |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 9 Months Ended | ||||
Mar. 31, 2014 | |||||
Summary of Significant Accounting Policies [Abstract] | ' | ||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | ||||
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||||
Basis of Consolidation | |||||
The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary BLB. All significant intercompany balances and transactions are eliminated in consolidation. | |||||
Method of Accounting | |||||
The Company maintains its accounting records on the accrual method of accounting in conformity with GAAP. As of September 30, 2013, the Company reclassified the presentation of freight-out expenses of $72,705 and $335,232 for the three and nine months ended March 31, 2013, respectively, from cost of sales and has included the expense as a selling expense in the accompanying condensed consolidated statements of operations. As of December 31, 2013, the Company reclassified the presentation of commissions and fees of $26,054 for the three months ended September 30, 2013 and $219,200 and $144,749 for the three and nine months ended March 31, 2013, respectively, from general and administrative expense and has included the expense as a selling expense in the accompanying condensed consolidated statements of operations. | |||||
Use of Estimates | |||||
In preparing the financial statements in conformity with GAAP, management makes estimates and assumptions that affect the reported amount of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Actual results could differ from these estimates. Management bases its estimates on certain assumptions that it believes to be reasonable as of the reporting period, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. The most subjective and intricate estimates include inventory obsolescence reserves, certain accruals, returns and allowances and fair value calculations, including derivative liabilities and stock option expense. | |||||
Revenue Recognition | |||||
The Company recognizes revenue generally when all of the following criteria are met (a) persuasive evidence of an arrangement exists through customer issued purchase orders or company verified sales orders, (b) title has transferred upon delivery of products, (c) our sales price is fixed or determinable as included on our sales orders or customer purchase orders, net of estimated returns and discounts, and (d) collection is probable based on customers history or third party credit checks. | |||||
For the nine months ended March 31, 2014, the Company achieved 40% of net revenues from international customers and 60% of net revenues from its domestic customers. For the nine months ended March 31, 2013, the Company achieved 3% of net revenues from international customers and 97% of net revenues from its domestic customers. | |||||
For the three months ended March 31, 2014, the Company achieved 4% of net revenues from international customers and 96% of net revenues from its domestic customers. For the three months ended March 31, 2013, the Company achieved 3% of net revenues from international customers and 97% of net revenues from its domestic customers. | |||||
The Company offers its customers a variety of sales and incentive programs, including discounts, allowances, coupons, slotting fees, and co-op advertising; such amounts are recorded as a reduction of revenue over the period in which revenue is recognized. | |||||
The Company reduced revenue in the amount of $1,221,625 and $812,526 for the nine months ended March 31, 2014 and March 31, 2013, respectively, and such amounts are included in discounts in the accompanying condensed consolidated statement of operations. | |||||
The Company reduced revenue in the amount of $439,105 and $584,983 for the three months ended March 31, 2014 and March 31, 2013, respectively, and such amounts are included in discounts in the accompanying condensed consolidated statement of operations. | |||||
Fair Value Measurements | |||||
The Company’s financial instruments are primarily composed of cash, accounts receivable, factoring line of credit, accounts payable, and its convertible notes and warrants. The fair value of cash, restricted cash, accounts receivable, factoring line of credit, accounts payable and convertible notes closely approximates their carrying value due to their short maturities. | |||||
The valuation techniques utilized for the warrants and beneficial conversion feature of its convertible notes are based upon observable and unobservable inputs. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect internal market assumptions. These two types of inputs create the following fair value hierarchy: | |||||
Level 1 – Quoted prices in active markets for identical assets or liabilities. | |||||
Level 2 – Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related asset or liabilities. | |||||
Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of assets or liabilities. | |||||
The Company utilizes observable market inputs (quoted market prices) when measuring fair value whenever possible. | |||||
The Company’s warrants and the beneficial conversion feature for its convertible notes are categorized within Level 3 of the fair value hierarchy. The development and determination of the unobservable inputs for Level 3 fair value measurements and fair value calculations are the responsibility of the Company's accounting and finance department. | |||||
As of March 31, 2014, there were no transfers in or out of Level 3 from other levels. | |||||
Cash and Cash Equivalents | |||||
The Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. | |||||
Accounts Receivable | |||||
Accounts receivable balances represent payments due to the Company for previously recognized net sales, reduced by an allowance for doubtful accounts for balances, which are estimated to be uncollectible at March 31, 2014 and June 30, 2013, respectively. The Company grants credit terms in the normal course of business to its customers. The Company does not require collateral or other security to support credit sales. The allowance for doubtful accounts is determined based on historical experience and ongoing evaluations of the Company’s receivables and evaluations of the risks of payment. The allowance for doubtful accounts is recorded against accounts receivable balances when they are deemed uncollectible. When accounts are deemed significantly past due and uncollectible, the accounts receivable balances are written down for the amount deemed to be uncollectible. Recoveries of accounts receivable previously reserved are recorded in the consolidated statements of operations when received. As of March 31, 2014, all of the Company’s accounts receivable were deemed to be collectible. One customer accounted for 89% and 94% of outstanding accounts receivable, prior to discounts and accruals, as of March 31, 2014 and June 30, 2013, respectively. | |||||
Inventories | |||||
Inventories, which consist primarily of finished goods, include items which are considered salable or usable in future periods, and are stated at the lower of cost or market value, with cost being based on standard cost which approximates actual cost on a first-in, first-out basis. Costs include direct materials, direct labor and overhead (e.g., indirect labor, rent and utilities, depreciation, purchasing, receiving, inspection and quality control), and in-bound freight costs. The Company periodically reviews the value of items in inventory and provides write-downs or write-offs of inventory based on its assessment of market conditions. Write-downs and write-offs are charged to cost of goods sold. As of March 31, 2014 and June 30, 2013, the Company reserved $495,000 and $365,722, respectively, for write-offs. The inventory write-off reserve as of March 31, 2014 was for allowances related to liquidation of slower moving items, potential write-offs of work-in-process inventory and write-offs for obsolete inventory. Total inventories as of March 31, 2014 and June 30, 2013 were $1.713 million and $1.949 million, respectively. | |||||
Property and Equipment | |||||
Property and equipment as of March 31, 2014 consists of costs incurred by the Company in connection with installing display fixtures at certain key customer display rooms and retail stores. The display fixtures are being depreciated on a straight-line basis over two years, which approximates the estimated useful lives of such assets. Display fixtures maintained at customer display rooms and retail stores amounted to $496,463, net of accumulated depreciation, at March 31, 2014. | |||||
Depreciation expense amounted to $361,812 and $89,262 for the nine months ended March 31, 2014 and March 31, 2013, respectively, and is included in depreciation & amortization expense in the accompanying condensed consolidated statements of operations. | |||||
Depreciation expense amounted to $126,843 and $77,609 for the three months ended March 31, 2014 and March 31, 2013, respectively, and is included in depreciation & amortization expense in the accompanying condensed consolidated statements of operations. | |||||
Advertising | |||||
Advertising costs are expensed as incurred. Total advertising expenses amounted to $89,236 and $505,935 for the nine months ended March 31, 2014 and March 31, 2013, respectively, and are included in general and administrative expenses in the accompanying condensed consolidated statements of operations. Total advertising expenses amounted to $1,212 and $215,173 for the three months ended March 31, 2014 and March 31, 2013, respectively, and are included in general and administrative expenses in the accompanying condensed consolidated statements of operations. | |||||
Selling Expenses and Commissions | |||||
Selling expenses are expensed as incurred. Total selling expenses amounted to $369,359 and $585,241 for the nine months ended March 31, 2014 and 2013, respectively, and are included in operating expenses in the accompanying statements of operations. Total selling expenses amounted to $18,843 and $243,463 for the three months ended March 31, 2014 and 2013. | |||||
As of September 30, 2013, the Company reclassified the presentation of freight-out from cost of sales and has included the expense as a selling expense under operating expenses in the accompanying condensed consolidated statements of operations. Accordingly, the prior periods have been updated to reflect such reclassification. Shipping expense is included in selling expense under operating expenses and amounted to $89,256 and $335,232 during the nine months ended March 31, 2014 and March 31, 2013, respectively. Total shipping expense was $14,678 and $72,705 for the three months ended March 31, 2014 and 2013, respectively. | |||||
Selling commissions are expensed as incurred. As of December 31, 2013, the Company reclassified the presentation of commissions and fees from general and administrative expenses and has included the expense as a selling expense under operating expenses in the accompanying condensed consolidated statements of operations. Accordingly, the prior periods have been updated to reflect such reclassification. Total selling commissions amounted to $63,338 and $219,200 for the nine months ended March 31, 2014 and 2013, respectively, and are included in selling expenses in the accompanying condensed consolidated statements of operations. Total selling commissions amounted to $(10,718) and $144,749 for the three months ended March 31, 2014 and 2013, respectively. | |||||
Deferred Financing Costs | |||||
Deferred financing costs represent fees paid in connection with obtaining short-term loans and convertible notes (see Notes 4, 5 and 6). These fees are amortized using a method that approximates the effective interest method over the term of the related financing. | |||||
As of March 31, 2014 and June 30, 2013, deferred financing costs of $157,560 and $358,792, respectively, net of accumulated amortization, are presented on the accompanying condensed consolidated balance sheets. | |||||
Amortization expense for deferred financing costs was $198,836 and $656,623 for the nine months ended March 31, 2014 and March 31, 2013, respectively, is included in interest expense in the accompanying condensed consolidated statements of operations. The remaining deferred financing costs will be fully amortized by August 1, 2015. | |||||
Debt Discount | |||||
The Company records debt discounts in connection with raising funds through the issuance of convertible debt (see Note 5). These costs are amortized to interest expense over the life of the debt. If a conversion of the underlying debt occurs, a proportionate share of the unamortized amounts is charged to the statement of operations. | |||||
As of March 31, 2014 and June 30, 2013, convertible debt, net of unamortized debt discounts, was $1,085,779 and $281,716, respectively. | |||||
Amortization expense for debt discounts was $753,437 and $551,502 for the nine months ended March 31, 2014 and March 31, 2013, and is included in interest expense in the accompanying condensed consolidated statements of operations. Amortization expense for debt discounts was $261,614 and $498,798 for the three months ended March 31, 2014 and March 31, 2013 and is included in interest expense in the accompanying condensed consolidated statements of operations. The remaining debt discounts will be fully amortized by August 1, 2015 (see Note 5). | |||||
Derivative Financial Instruments | |||||
GAAP requires derivative instruments embedded in convertible debt or equity instruments, to be bifurcated and measured at their fair value for accounting purposes. In determining the appropriate fair value, the Company uses the Black-Scholes option-pricing model, which management estimates to approximate the fair value using the Binomial Lattice Model. In assessing the debt instruments with characteristics of liability and equity, management determines if the convertible debt host instrument is conventional convertible debt and if there is a beneficial conversion feature. If the instrument is not considered conventional convertible debt, the Company will estimate the fair value of the embedded derivative instruments. The warrant liability is measured at fair value on a recurring basis using level 3 inputs (see Notes 5 and 6). | |||||
Financial Instruments and Concentrations of Business and Credit Risk | |||||
The Company’s financial instruments include cash and cash equivalents, convertible debt, a factoring line of credit, short-term loans, accounts payable and other current assets and liabilities. The fair value of these instruments approximates their carrying value due to their relatively short maturities. Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents. Customer concentrations also subject the Company to concentrations of credit risk. The Company maintains cash balances that at times exceed amounts insured by the Federal Deposit Insurance Corporation. | |||||
Three customers accounted for approximately 22%, 29% and 28% of the Company’s net revenues for the nine months ended March 31, 2014. Three customers accounted for approximately 45%, 19% and 7% of the Company’s net revenues for the nine months ended March 31, 2013. | |||||
Three customers accounted for approximately 77%, 17% and 10% of the Company’s net revenues for the three months ended March 31, 2014. Three customers accounted for approximately 58%, 11% and 9% of the Company’s net revenues for the three months ended March 31, 2013. | |||||
Accounts receivable for one customer represented 89% of the Company’s accounts receivable balance as of March 31, 2014. Accounts receivable for one customer represented 94% of the Company’s accounts receivable balance as of June 30, 2013. | |||||
Three suppliers represented 31%, 16%, and 12% of the Company’s inventory purchases as of March 31, 2014. | |||||
The Company has not experienced any losses in these accounts and believes it is not exposed to any significant credit risk in this area. | |||||
License Acquisition Costs | |||||
License acquisition costs represent legal fees paid in connection with obtaining the Company’s license agreements (see Note 3). These fees are amortized using the straight-line method over the term of each license agreement. | |||||
As of March 31, 2014 and June 30, 2013, license acquisition costs, net of amortization, were $18,376 and $24,504, respectively on the accompanying condensed consolidated balance sheets. | |||||
Amortization of license acquisition costs of $6,128 and $1,998 is included in depreciation and amortization expense in the accompanying condensed consolidated statements of operations for the nine months ended March 31, 2014 and March 31, 2013. Amortization of license acquisition costs was $1,922 and $656 for the three months ended March 31, 2014 and March 31, 2013. | |||||
Estimated future license acquisition cost amortization expense is as follows: | |||||
Twelve month periods ending March 31, | |||||
2015 | $ | 7,793 | |||
2016 | 7,533 | ||||
2017 | 3,050 | ||||
$ | 18,376 | ||||
Impairment of Long-Lived Assets | |||||
The Company evaluates long-lived assets and certain identifiable intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to undiscounted future cash flows expected to be generated by the asset. In such cases, the carrying value of these assets are adjusted to their estimated fair value and assets held for sale are adjusted to their estimated fair value less selling expenses. No impairment losses of long-lived assets or intangible assets were recognized for the nine and three months ended March 31, 2014 and March 31, 2013. | |||||
Income Taxes | |||||
The Company uses the asset and liability method of accounting for income taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized as income in the period that includes the enactment date. The Company provides a valuation allowance against its deferred tax assets when circumstances indicate that it is no longer more likely than not that such assets will be realized. | |||||
Net Loss Per Share | |||||
Basic net income / (loss) per share is computed by dividing net income / (loss) by the weighted average number of shares of common stock outstanding for the period. The Company’s potential dilutive shares, which include common stock options, common stock warrants and convertible debt have not been included in the computation of diluted net loss per share for all periods where there was a net loss as the result would be antidilutive. Such potentially dilutive shares are excluded when the effect would be to reduce net loss per share. Such potential shares of common stock consist of the following: | |||||
As of | |||||
March 31, | |||||
2014 | |||||
Warrants | 747,354 | ||||
Stock options | 177,800 | ||||
Convertible Debt | 396,288 | ||||
Preferred Stock | 80,000 | ||||
1,401,442 |
Licensing_Agreement_and_Prepai
Licensing Agreement and Prepaid Royalties | 9 Months Ended | ||||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||||
Licensing Agreement and Prepaid Royalties [Abstract] | ' | ||||||||||||||||||||
LICENSING AGREEMENT AND PREPAID ROYALTIES | ' | ||||||||||||||||||||
NOTE 3. LICENSING AGREEMENT AND PREPAID ROYALTIES | |||||||||||||||||||||
On July 11, 2012, the Company entered into a license agreement with an individual pursuant to which the Company (i) acquired the exclusive right to use the licensor’s image in connection with the development, production, distribution, advertisement, promotion and sale of products and (ii) the licensor agreed to provide certain ancillary services in connection with the marketing and promotion of the licensed products. The license agreement remains in effect through February 29, 2016. | |||||||||||||||||||||
During the term of the license agreement and as consideration for the grant of the license the Company has agreed to pay the licensor a royalty rate depending on the product sold on all net sales of all products during the contract term. In addition the Company has agreed to pay a guaranteed minimum royalty payment of $600,000 over the life of the agreement, depending on the launch date of various products in accordance with the following schedule and subject to annual minimum amounts: | |||||||||||||||||||||
· | Contract period two: $225,000 | ||||||||||||||||||||
· | Contract period three: $275,000 | ||||||||||||||||||||
As part of the license agreement, $100,000 was prepaid and is presented net of amortization of $100,000 under prepaid royalty as of March 31, 2014. | |||||||||||||||||||||
On April 25, 2013, the Company entered into a license agreement with an entity pursuant to which the Company (i) acquired the exclusive right to use the licensor’s image in connection with the development, production, distribution, advertisement, promotion and sale of products and (ii) the licensor agreed to provide certain ancillary services in connection with the marketing and promotion of the licensed products. The license agreement remains in effect through April 16, 2016. | |||||||||||||||||||||
During the term of the license agreement and as consideration for the grant of the license the Company has agreed to pay the licensor a royalty rate depending on the product sold on all net sales of all products during the contract term. In addition the Company has agreed to pay a guaranteed minimum royalty payment of $100,000 over the life of the agreement, depending on the launch date of various products in accordance with the following schedule and subject to annual minimum amounts: | |||||||||||||||||||||
· | Contract period two: $33,333 | ||||||||||||||||||||
· | Contract period three: $33,334 | ||||||||||||||||||||
As part of the license agreement, $10,000 was prepaid and is presented net of amortization of $5,590 under prepaid royalty as of March 31, 2014. | |||||||||||||||||||||
On May 9, 2012, the Company entered into a license agreement with three individuals pursuant to which the Company (i) acquired the exclusive right to use the licensors’ images in connection with the development, production, distribution, advertisement, promotion and sale of products and (ii) the licensors agreed to provide certain ancillary services in connection with the marketing and promotion of the licensed products. The license agreement remains in effect through November 30, 2016. The Company has the option to extend the term of the license agreement for an additional period of eighteen months. | |||||||||||||||||||||
During the term of the license agreement and as consideration for the grant of the license the Company has agreed to pay the licensors a single digit royalty depending on the product sold on all wholesale sales of all products during the contract term. In addition the Company has agreed to pay a guaranteed minimum royalty payment of $4,686,125 or $4,985,000 over the life of the agreement, depending on the launch date of various products in accordance with the following schedule and subject to annual minimum amounts: | |||||||||||||||||||||
· | Contract period two: $925,000 or $1,000,000 | ||||||||||||||||||||
· | Contract period three: $1,188,625 or $1,285,000 | ||||||||||||||||||||
· | Contract period four: $1,572,500 or $1,700,000 | ||||||||||||||||||||
In addition to the royalty payments and guaranteed minimum royalty payments, the Company granted the licensors warrants to purchase 100,000 common shares of the Company’s common stock on a cashless exercise basis. | |||||||||||||||||||||
As part of the license agreement, $1,000,000 was prepaid during period ended June 30, 2012 and is presented net of amortization of $1,000,000 under prepaid royalty as of March 31, 2014. | |||||||||||||||||||||
Contractual Obligations and Commitments: | |||||||||||||||||||||
The table below provides information concerning obligations of our contractual commitment, as of March 31, 2014, over the life of the agreements, depending on the launch date of various products in accordance with the contract periods per the license agreements and subject to annual minimum amounts: | |||||||||||||||||||||
Total | Less than | 1 – 3 years | 3 - 5 years | More than | |||||||||||||||||
1 year | 5 years | ||||||||||||||||||||
License agreement obligations | $ | 4,879,560 | $ | 1,301,250 | $ | 3,578,310 | $ | 0 | $ | 0 | |||||||||||
Operating lease obligation | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | |||||||||||
Total | $ | 4,879,560 | $ | 1,301,250 | $ | 3,578,310 | $ | 0 | $ | 0 | |||||||||||
In addition to the above license agreement obligations, the Company has accrued $439,344 for royalty fees owed as of March 31, 2014, per the contract period terms under the licensing agreements. The Company recognized royalty expense of $413,915 and $25,429 for the three and nine month period ended March 31, 2014. |
Factoring_Agreements_and_Short
Factoring Agreements and Short - Term Loans | 9 Months Ended | ||||
Mar. 31, 2014 | |||||
Factoring Agreements and Short Term Loans [Abstract] | ' | ||||
FACTORING AGREEMENTS AND SHORT - TERM LOANS | ' | ||||
NOTE 4. FACTORING AGREEMENTS AND SHORT - TERM LOANS | |||||
Factoring Agreements | |||||
Effective as of November 21, 2012, each of BLBK and BLB entered into a one-year renewable Factoring Agreement (the “Factoring Agreements”) and Supply Agreement (the “Supply Agreements”) with Star Funding, Inc. Under the terms of the Factoring Agreements, the Company sells most of its trade receivables to the factor without recourse as to credit risk but with recourse for any claims by customers for adjustments in the normal course of business. The Company is able to borrow up to 80% of its factored receivables. Under the terms of the Supply Agreements, the Company is able to finance the purchases of its inventory. | |||||
For the nine months ended March 31, 2014 and March 31, 2013, interest and commissions totaled approximately $78,162 and $132,255, respectively, under the Factoring Agreements and Supply Agreements. For the three months ended March 31, 2014 and March 31, 2013, interest and commissions totaled approximately $18,255 and $95,490, respectively, under the Factoring Agreements and Supply Agreements. Balances due from factor include outstanding accounts receivables from customers net of allowances for discounts and chargebacks, advances and interest due to factor. The Factoring Agreements and Supply Agreements limit the Company’s ability to: (i) incur additional debt, (ii) pay dividends or make distributions to its stockholders, (iii) incur liens that would rank senior in priority to, or pari passu with, the obligations under the Company’s the Factoring Agreements and Supply Agreements, (iv) sell certain assets, and (v) sell or otherwise dispose of any assets or rights of the Company or any of its subsidiaries, subject to certain exceptions. Substantially all of the Company’s assets are collateralized against the Factoring Agreements and Supply Agreements. The Company is continuing to operate under the existing Factoring Agreements and Supply Agreements until their renewal or cancellation, which automatically renewed on November 21, 2013 for an additional one-year period. | |||||
Due from Factor | $ | 204,231 | |||
Positive Loan Balance (due from factor): | 48,969 | ||||
Unapplied Customer Credits | 0 | ||||
Due from Factor, Net | $ | 253,200 | |||
Short - Term Loans | |||||
During the nine months ended March 31, 2013, the Company issued secured bridge loan promissory notes totaling in the aggregate $300,000 bearing interest at a rate of 10% per annum. | |||||
The promissory notes were issued in two installments: | |||||
· | September 7, 2012 - $150,000, due by December 7, 2012 | ||||
· | September 25, 2012 - $150,000, due by December 25, 2012 | ||||
On March 28, 2013, the Company issued an additional 1,500 five-year warrants to a holder of the shareholder notes to extend the terms of the shareholder note as it was past due. These warrants are exercisable for a period of five years at a purchase price of $25.00 per share of the Company’s common stock. These warrants contain certain anti-dilution and other customary terms. As of March 28, 2013, the Company had re-paid the principal and accrued interest on all of the bridge loan promissory notes. | |||||
On November 9, 2012, the Company issued a short-term note in the principal amount of $60,000 to a stockholder of the Company bearing interest at an annual rate of 10%. As of December 21, 2012, the Company had re-paid the principal plus accrued interest on this promissory note. | |||||
On December 7, 2012, the Company issued a secured bridge loan promissory note totaling $100,000 bearing interest at a rate of 10% per annum. As of December 21, 2012, the Company has re-paid the principal plus interest on this promissory note. | |||||
On October 4, 2012, the Company entered into a Purchase Order Sale Agreement (the “PO Agreement”) with Solops LLC, under which it financed certain of its contracts of orders (or purchase orders) (the “Orders”), which represent amounts due from bona fide contracts for the sale and delivery of the Company’s goods to certain merchants, in the principal amount of $1,125,000. Pursuant to the PO Agreement, the Company sold the Orders to Solops for a purchase price of $875,000. Under the terms of the PO Agreement, Solops will receive $1,065,000 through a combination of the merchants’ payments under the Orders directly to Solops, the Company’s collection of accounts receivable under the Orders and resulting payments to Solops and/or any other payments made by the Company to Solops under the PO Agreement. Upon the full payment to Solops of $1,065,000, the PO Agreement will immediately terminate and Solops will convey, assign and deliver back to the Company the Orders and all of its rights thereunder. After such full payment is made, the Company will regain sole ownership of the Orders and it will not have any further obligations to Solops, and Solops will not have any further rights, with respect to the Orders or under the PO Agreement. As of November 21, 2012, the Company has re-paid its obligation under the PO Agreement. |
Convertible_Debt_Offering
Convertible Debt Offering (Convertible Note [Member]) | 9 Months Ended | ||||
Mar. 31, 2014 | |||||
Convertible Note [Member] | ' | ||||
CONVERTIBLE DEBT OFFERING | ' | ||||
NOTE 5. CONVERTIBLE DEBT OFFERINGS | |||||
Bridge Note Offering | |||||
On March 31, 2014, the Company issued senior secured bridge notes (“Bridge Note”) for total gross proceeds of $1,000,000 with a 12% original issue discount and a conversion price of $2.90 per share (the “Bridge Note Conversion Price”) after giving effect to the Reverse Stock Split. | |||||
The term of the Bridge Note includes a seventeen-month maturity period, with partial redemption beginning on February 1, 2015. The Bridge Note bears interest at a rate of 8% per annum, which is paid quarterly. Interest is payable in cash or at the Company’s option in shares of common stock, provided certain conditions are met, based on a share value equal to the lesser of (a) 90% of the average of the volume weighted average price (the “VWAP”) for the 20 consecutive trading days prior to the applicable interest payment date and (b) 100% of the average of the VWAP for the 20 consecutive trading days prior to the applicable interest payment date less $1.00. If any Event of Default (as defined in the Debentures) occurs, the outstanding principal amount of the Debentures, plus accrued but unpaid interest, liquidated damages and other amounts owing in respect thereof through the date of acceleration, shall become, at the holder’s election, immediately due and payable in cash. Commencing five days after the occurrence of any Event of Default that results in the eventual acceleration of the Debentures, the interest rate on the Debentures shall accrue at an interest rate equal to the lesser of 18% per annum or the maximum rate permitted under applicable law. The Bridge Note Conversion Price is subject to “full ratchet” and other customary anti-dilution protections. | |||||
The agreement relating to the Bridge Note includes the covenant that the Company must timely file (or obtain extensions in respect thereof and file within the applicable grace period) all reports required to be filed by the Company pursuant to the Exchange Act. The Company did not timely file this Form 10-Q and as a result we are in breach of this covenant. The Bridge Note limits the Company’s ability to (i) incur additional indebtedness, (ii) pay dividends or make distributions to its shareholders, (iii) incur liens that would rank senior in priority or pari passu to the Bridge Note, or (iv) sell or otherwise dispose of any assets or rights of the Company or its subsidiaries. | |||||
In connection with the issuance of the Bridge Note, warrants to purchase 345,868 shares of the Company’s common stock (“Bridge Note Warrants”) were issued. The Bridge Note Warrants are exercisable for five years on a cashless basis. The Bridge Note Warrants are exercisable at $3.50 per share (after giving effect to the Reverse Stock Split) and are subject to “weighted average” and other customary anti-dilution protections (see Note 6). | |||||
Bridge Note Redemption | |||||
On February 1, 2015 and May 1, 2015, the Company is obligated to redeem an amount equal to $280,000 and on August 1, 2015, the Company is obligated to redeem an amount equal to $560,000 (plus accrued but unpaid interest, liquidated damages and any other amounts then owing in respect of the Bridge Note) (collectively, the “Periodic Redemption Amount”). In lieu of a cash redemption and subject to the Company meeting certain equity conditions described in the Bridge, the Company may elect to pay the Periodic Redemption Amount in shares of its common stock based on a conversion price equal to the lesser of (a) $2.90 per share, subject to adjustments upon certain events, and (b) 90% of the average of the VWAP for the 20 consecutive trading days prior to the applicable redemption date. | |||||
Debt Discounts | |||||
The fair value of the Bridge Note Warrants and the corresponding Debt Conversion Feature, issued on March 31, 2014, totaling $111,808 is recorded as a debt discount in the accompanying consolidated condensed balance sheet as of March 31, 2014 and is amortized as interest expense in the accompanying condensed statements of operations over the term of the Bridge Note using the effective interest method (see Note 6). | |||||
Original Issue Discount | |||||
For certain convertible debt issue, the Company may provide the debt holder with an original issue discount. The Bridge Note was issued with an original issue discount of 12%. The original issue discount is recorded as debt discount, reducing the face amount of each Bridge Note and is amortized to interest expense over the term of the Bridge Note. | |||||
Bridge Note Face Value | $ | 1,120,000 | |||
Debt Discount | |||||
Bridge Notes – Issued Warrant Derivative | 93,980 | ||||
Conversion Feature Derivative | 17,828 | ||||
Original Issue Discount | 120,000 | ||||
Total Debt Discount | $ | 231,808 | |||
Amortization of Debt Discount, as of March 31, 2014 | (459 | ) | |||
Debt Discount, Net | $ | 231,349 | |||
Bridge Note Carrying Value at March 31, 2014 | $ | 888,651 | |||
Deferred Financing Costs | |||||
Transaction Fees | |||||
The Company paid $70,405 in legal fees and due diligence fees of $50,000 in connection with the Bridge Note offering. | |||||
Legal fees and other fees associated with the Bridge Note offering | $ | 120,405 | |||
Total Deferred Financing Costs | $ | 120,405 | |||
Amortization of Deferred Financing Costs, as of March 31, 2014 | (239 | ) | |||
Deferred Financing Costs, Net, as of March 31, 2014 | $ | 120,166 | |||
August Convertible Notes Offering | |||||
On August 29, 2013, the Company issued senior secured convertible notes (the “August Convertible Notes”) with an original issue discount of 12% and a conversion price of $6.80 per share (the “August Conversion Price”) for gross proceeds of $616,000. The term of the August Convertible Notes include an eighteen-month maturity period, with partial redemption beginning on September 1, 2014. The August Convertible Notes bear interest at a rate of 8% per annum, which is paid quarterly. Interest is payable in cash or at the Company’s option in shares of common stock, provided certain conditions are met, based on a share value equal to the lesser of (a) 90% of the average of the volume weighted average price (the “VWAP”) for the 20 consecutive trading days prior to the applicable interest payment date and (b) 100% of the average of the VWAP for the 20 consecutive trading days prior to the applicable interest payment date less $1.00. Upon any Event of Default (as defined in the August Convertible Notes), the outstanding principal amount of each August Convertible Note, plus liquidated damages, interest, a premium of 30% and other amounts owing in respect thereof through the date of acceleration, shall become, at the noteholders’ election, immediately due and payable in cash. Commencing five days after the occurrence of any Event of Default, the interest rate on each August Convertible Note shall accrue at an interest rate equal to the lesser of 18% per annum or the maximum rate permitted under applicable law. The August Conversion Price is subject to “full ratchet” and other customary anti-dilution protections. | |||||
In connection with the issuance of the August Convertible Note, warrants to purchase 90,588 shares of the Company’s common stock (“August Convertible Note Warrants”) were issued. The August Convertible Note Warrants are exercisable for five years on a cashless basis. The August Convertible Note Warrants are exercisable at $8.20 per share and are subject to “weighted average” and other customary anti-dilution protections (see Note 6). | |||||
August Convertible Note Redemption | |||||
On September 1, 2014, October 1, 2014, November 1, 2014, December 1, 2014, January 1, 2015 and February 1, 2015, the Company is obligated to redeem an amount equal to $51,333 and on March 1, 2015, the Company is obligated to redeem an amount equal to $308,000 (plus accrued but unpaid interest, liquidated damages and any other amounts then owing in respect of the August Convertible Notes) (collectively, the “Periodic Redemption Amount”). In lieu of a cash redemption and subject to the Company meeting certain equity conditions described in the August Convertible Notes, the Company may elect to pay the Periodic Redemption Amount in shares of its common stock based on a conversion price equal to the lesser of (a) $6.80 per share, subject to adjustments upon certain events, and (b) 90% of the average of the VWAP for the 20 consecutive trading days prior to the applicable redemption date. | |||||
Debt Discounts | |||||
The fair value of the August Convertible Note Warrants and the corresponding Debt Conversion Feature, issued on August 29, 2013, totaling $113,091 is recorded as a debt discount in the accompanying consolidated condensed balance sheet as of March 31, 2014 and is amortized as interest expense in the accompanying condensed statements of operations over the term of the August Convertible Note using the effective interest method (see Note 6). | |||||
Original Issue Discount | |||||
For certain convertible debt issue, the Company may provide the debt holder with an original issue discount. The August Convertible Notes were issued with an original issue discount of 12%. The original issue discount is recorded as debt discount, reducing the face amount of each August Convertible Note and is amortized to interest expense over the term of the August Convertible Note. | |||||
August Convertible Note Face Value | $ | 616,000 | |||
Debt Discount | |||||
August Convertible Notes – Issued Warrant Derivative | 87,264 | ||||
Conversion Feature Derivative | 25,827 | ||||
Original Issue Discount | 66,000 | ||||
Total Debt Discount | $ | 179,091 | |||
Amortization of Debt Discount, as of March 31, 2014 | (179,091 | ) | |||
Debt Discount, Net | $ | 0 | |||
August Convertible Note Carrying Value at March 31, 2014, gross | $ | 616,000 | |||
Conversion of August Convertible Note into Preferred | (616,000 | ) | |||
August Convertible Note Carrying Value at March 31, 2014, net | $ | 0 | |||
As of March 31, 2014, the full value of this debt and debt discount had been amortized as a result of the conversion of the August Convertible Note and August Convertible Note Warrants (see Note 7). | |||||
Deferred Financing Costs | |||||
Transaction Fees | |||||
The Company paid $12,065, collectively, in legal fees to Gottbetter & Partners and Loeb & Loeb, and $50,000 in professional fees to the lead investor in the August Convertible Notes offering. | |||||
Legal fees and other fees associated with the August Convertible Notes offering | $ | 62,065 | |||
Total Deferred Financing Costs | $ | 62,065 | |||
Amortization of Deferred Financing Costs, as of March 31, 2014 | (62,065 | ) | |||
Deferred Financing Costs, Net, as of March 31, 2014 | $ | 0 | |||
As of March 31, 2014, the full value of deferred financing costs had been amortized as a result of the conversion of the August Convertible Note (see Note 7). | |||||
June Convertible Notes Offering | |||||
On June 20, 2013, the Company issued $1,500,000 senior secured convertible notes (the “June Convertible Notes”) with an original issue discount of 12%, and a conversion price of $6.80 per share (the “June Conversion Price”), for gross proceeds of $1,680,000. The term of the June Convertible Notes includes an eighteen-month maturity period, with partial redemptions beginning on June 1, 2014. The June Convertible Notes bear interest at 8% per annum, which is paid quarterly beginning on November 1, 2013. Interest is payable in cash or at the Company’s option in shares of the Company’s common stock, provided certain conditions are met, based on a share value equal to the lesser of (a) 90% of the average of the VWAP for the 20 consecutive trading days prior to the applicable interest payment date and (b) 100% of the average of the VWAP for the 20 consecutive trading days prior to the applicable interest payment date less $1.00. Upon any Event of Default (as defined in the June Convertible Notes), the outstanding principal amount of the June Convertible Notes plus liquidated damages, interest, a premium of 30% and other amounts owing in respect thereof through the date of acceleration, shall become, at the holders’ election, immediately due and payable in cash. Commencing five days after the occurrence of any Event of Default, the interest rate on the June Convertible Notes shall accrue at an interest rate equal to the lesser of 18% per annum or the maximum rate permitted under applicable law. The June Conversion Price is subject to “full ratchet” and other customary anti-dilution protections. | |||||
The agreement relating to the June Convertible Notes includes the covenant that the Company must timely file (or obtain extensions in respect thereof and file within the applicable grace period) all reports required to be filed by the Company pursuant to the Exchange Act. The Company did not timely file this Form 10-Q and as a result we are in breach of this covenant. The June Convertible Notes limit the Company’s ability to (i) incur additional indebtedness, (ii) pay dividends or make distributions to its shareholders, (iii) incur liens that would rank senior in priority or pari passu to the June Convertible Notes, or (iv) sell or otherwise dispose of any assets or rights of the Company or its subsidiaries. | |||||
In connection with the issuance of the June Convertible Notes, warrants to purchase 247,059 shares of the Company’s common stock (“June Convertible Note Warrants”) were issued. The June Convertible Note Warrants are exercisable for five years on a cashless basis. The June Convertible Note Warrants are exercisable at $8.20 per share and are subject to “weighted average” and other customary anti-dilution protections (see Note 6). | |||||
June Convertible Note Redemption | |||||
On June 1, 2014, July 1, 2014, August 1, 2014, September 1, 2014, October 1, 2014 and November 1, 2014, the Company is obligated to redeem an amount equal to $140,000 and on December 1, 2014, the Company is obligated to redeem an amount equal to $840,000 (plus accrued but unpaid interest, liquidated damages and any other amounts then owing in respect of the June Convertible Notes) (collectively, the “June Periodic Redemption Amount”). In lieu of a cash redemption and subject to the Company meeting certain equity conditions described in the June Convertible Notes, the Company may elect to pay the June Periodic Redemption Amount in shares of its common stock based on a conversion price equal to the lesser of (a) $6.80 per share, subject to adjustments upon certain events, and (b) 90% of the average of the VWAP for the 20 consecutive trading days prior to the applicable redemption date. | |||||
As of March 31, 2014, $1,337,143 of the June Convertible Note had converted (see Note 7). The lead investor in the remaining $342,857 of the June Convertible Note cancelled the Security Agreement and Subsidiary Guarantee effective as of March 31, 2014. | |||||
Debt Discounts | |||||
The fair value of the June Convertible Note Warrants and the corresponding Debt Conversion Feature, issued on June 20, 2013, totaling $1,423,177 is recorded as a debt discount in the accompanying condensed consolidated balance sheet as of March 31, 2014. As of March 31, 2014, the Company had expensed $568,341 of debt discount costs as loss from extinguishment in relation to the conversion of certain of the June Convertible Notes (see Note 7). The remaining balance of $145,729 will be amortized as interest expense in the accompanying condensed consolidated statements of operations of the term of the remaining June Convertible Notes using the effective interest method (see Note 6). | |||||
Original Issue Discount | |||||
For certain convertible debt issue, the Company may provide the debt holder with an original issue discount. The June Convertible Notes were issued with an original issue discount of 12%. The original issue discount is recorded to debt discount, reducing the face amount of each June Convertible Note and is amortized to interest expense over the term of the June Convertible Notes. | |||||
June Convertible Notes Face Value | $ | 1,680,000 | |||
Debt Discount | |||||
June Convertible Notes – Issued Warrant Derivative | 752,126 | ||||
Conversion Feature Derivative | 491,051 | ||||
Original Issue Discount | 180,000 | ||||
Total Debt Discount | $ | 1,423,177 | |||
Amortization of Debt Discount, as of March 31, 2014 | (709,107 | ) | |||
Debt Discount, gross | $ | 714,070 | |||
Amortized under Loss from Extinguishment as of March 31, 2014 | 568,341 | ||||
Debt Discount, net | $ | 145,729 | |||
June Convertible Notes Carrying Value at March 31, 2014, gross (net of debt discounts of | $ | 965,930 | |||
$714,070) | |||||
Conversion of June Convertible Notes into Preferred | 768,802 | ||||
June Convertible Notes Carrying Value at March 31, 2014, net (net of debt discounts of | $ | 197,128 | |||
$145,729) | |||||
Deferred Financing Costs | |||||
Transaction Fees | |||||
The Company paid Gottbetter Capital Markets (“GCM”) who acted as the sole placement agent for the June Convertible Notes offering a commission of 7.2% of the first $1,400,000 funds raised in the June Convertible Notes offering for a total payment of $100,000. In addition, GCM received five-year broker warrants to purchase approximately 0.019 million shares of the Company’s common stock at an exercise price of $8.20 per share (the “June Convertible Note Broker Warrants”). The June Convertible Note Broker Warrants are identical to the June Convertible Note Warrants in all material respects. The Company also paid $117,446 in legal fees to Gottbetter & Partners and $85,207 in professional fees to the lead investor in the June Convertible Notes offering. The following table sets forth a summary of the fees and costs associated with the June Convertible Notes offering. | |||||
Placement agent and other fees associated with the June Convertible Notes offering | $ | 304,293 | |||
June Convertible Note Broker Warrants | 60,886 | ||||
Total Deferred Financing Costs | $ | 365,179 | |||
Amortization of Deferred Financing Costs, as of March 31, 2014 | (327,785 | ) | |||
Deferred Financing Costs, Net, as of March 31, 2014 | $ | 37,394 | |||
December 2012 and March 2013 Convertible Notes Offering | |||||
On December 21, 2012 the Company issued senior secured convertible notes (the “Convertible Notes”). The term of the Convertible Notes include an eight month maturity period and an annual interest rate of 12% which is accrued until payment or until the Convertible Notes are converted into equity. The Convertible Notes were issued at a price of $200,000 per unit, for total gross proceeds of $2,000,000 with an original issue discount of 0.2%. On March 28, 2013, the Company issued additional Convertible Notes for total gross proceeds of $1,130,000 with an original issue discount of 0.2%. | |||||
The Convertible Notes are convertible at a per share conversion price of $25.00, which is subject to a one-time reset right (“Conversion Price Reset”) as well as “weighted average” and other customary anti-dilution protections (“Debt Conversion Feature”). The Conversion Price Reset will be available on the earlier of (the “Reset Date”) (i) the date of maturity of the 12% Notes or (ii) the completion of a subsequent financing by the Company of at least $5,000,000, if the closing price of the Company’s stock is less than $30.00 on the Reset Date. For (i) the conversion price after the reset will be equal to 70% of the 5-day VWAP immediately preceding the Reset Date. For (ii) the Conversion Price after the reset will be equal to 70% of 5-day VWAP immediately after the Reset Date. | |||||
In connection with the issuance of Convertible Notes, 125,200 five-year cashless exercise warrants (“Convertible Note Warrants”) were issued with “weighted average” and other customary anti-dilution protections. 62,600 Convertible Note Warrants are exercisable at $50.00 and 62,600 Convertible Note Warrants are exercisable at $25.00 (see Note 6 for further detail). | |||||
As of June 20, 2013, the Convertible Notes and the Convertible Note Warrants were converted into equity. The Convertible Notes were converted at a per share price of $70.00, as the Company’s stock price was less than $30.00 on the Reset Date, for 302,762 shares. The Convertible Note Warrants were converted into 700,00 shares of the Company’s common stock. | |||||
Debt Discounts | |||||
Convertible Note Warrants and Debt Conversion Feature | |||||
The fair value of the Convertible Note Warrants and the Debt Conversion Feature, issued as of December 21, 2012, totaling $1,353,720 was recorded as a debt discount in the accompanying balance sheet and was amortized as interest expense in the accompanying statement of operations over the term of the Convertible Note using the effective interest method (see Note 6 for further detail). The fair value of the Convertible Note Warrants and the Debt Conversion Feature, issued on March 28, 2013, totaling $272,697 is recorded as a debt discount in the accompanying balance sheet and is amortized as interest expense in the accompanying statement of operations over the term of the Convertible Note using the effective interest method (see Note 6, for further detail). | |||||
Original Issue Discount | |||||
For certain convertible debt issued, the Company may provide the debt holder with an original issue discount. The Convertible Notes issued on December 21, 2012 and March 28, 2013 were issued with an original issue discount of 0.2%. The original issue discount is recorded to debt discount, reducing the face amount of the note and is amortized to interest expense over the term of the Convertible Note. | |||||
As of June 30, 2013, the full value of this debt discount had been amortized as a result of the conversion of the Convertible Notes and Convertible Note Warrants into equity. | |||||
Deferred Financing Costs | |||||
Transaction Fees | |||||
The Company paid Aegis Capital Corp. (“Aegis”), who acted as the sole placement agent for the Convertible Notes Offering a commission of 10% of the funds raised in the Convertible Notes Offering and a 3% non-accountable reimbursement of its expenses, for a total payment of $406,900, which is recorded as a deferred financing cost in the accompanying balance sheet. | |||||
The Company incurred additional fees of $96,556 for legal and escrow agent fees in connection with the Convertible Notes Offering, which are recorded as a deferred financing cost in the accompanying balance sheet. | |||||
Convertible Note Broker Warrants | |||||
In addition, Aegis received five-year warrants (the “Convertible Note Broker Warrants”) to purchase 25,040 shares of the Company’s common stock. The Convertible Note Broker Warrants were issued with “weighted average” and other customary anti-dilution protections. The Convertible Note Broker Warrants are identical to the Convertible Note Warrants in all material respects, except that they are exercisable at $25.00. As of June 20, 2013, the Convertible Note Broker Warrants were considered converted into 22,536 shares of common stock based on the same conversion terms as the Convertible Note Warrants. The Convertible Note Broker Warrants were valued at approximately $194,381 based on a Black-Scholes model (see Note 6 for further detail). | |||||
Third Party Share Sale | |||||
The Convertible Note holders were sold 62,600 free trading shares by non-affiliated, third party shareholders of the Company at par value. Although the Company was not a party to the sale of these shares by third party shareholders, per FASB ASC Topic 718, the fair value of this non-affiliated third party transaction is recognized by the Company as a deferred financing cost of the Convertible Note transaction. Additionally, the Company will provide no reimbursement or compensation to the selling shareholders of the 62,600 free trading shares. As such, the Company does not anticipate recognizing any further expenses in relation to this third-party transaction. The fair value of this third party transaction of $1,537,940 is recorded under deferred financing costs in the accompanying balance sheet. | |||||
As of June 30, 2013, the full value of the deferred financing costs had been amortized as a result of the conversion of the Convertible Notes and Convertible Note Warrants into equity. | |||||
Derivative_Liability
Derivative Liability | 9 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Derivative Liability [Abstract] | ' | ||||||||
DERIVATIVE LIABILITY | ' | ||||||||
NOTE 6. DERIVATIVE LIABILITY | |||||||||
As of March 31, 2014, the Company had reserved 747,354 shares of common stock for issuance upon exercise of the Company’s outstanding warrants. The Company had reserved 396,288 shares of common stock for issuance upon exercise of the Company’s outstanding convertible debt and convertible preferred stock as of March 31, 2014. | |||||||||
In connection with the June and August Convertible Notes offerings, the Company entered into an Amendment and Waiver Agreement (collectively, the “Amendment Agreement”) the holders of substantially all of the securities issued in connection with the Company’s 2012 Bridge Notes (as defined below), PPO Units (as defined below), short-term loans and PPO and Bridge Broker Warrants (as defined below) with the holders (collectively, the “Holders”) pursuant to which the Company reduced the exercise prices of all of its outstanding Series A, Series B, Series C, Series D and Series E common stock purchase warrants (collectively, the “Warrants”) as follows: the exercise price per share of the Series A warrants that had an initial exercise price of $25.00 was reduced to $1.00; the exercise price per share of the Series B warrants that had an initial exercise price of $50.00 was reduced to $1.50; the exercise price per share of the Series C warrants that had an initial exercise price of $100.00 was reduced to $3.00; and the exercise price per share of the Series D and Series E warrants that had an initial exercise price of $25.00 was reduced to $1.00. As the triggering event for the re-pricing of the warrants was the June Convertible Notes offering, the effect of the reduction in the respective exercise prices was reflected in the June 30, 2013 statement of operations and accompanying balance sheet. | |||||||||
In consideration of the exercise price reductions, the Holders agreed to permanently waive all past and future exercise price and share number anti-dilution adjustment provisions that would otherwise be triggered by share issuances by the Company at prices less than the purchase, exercise or conversion price of any securities acquired by the Holders in the offerings or underlying any of such securities. | |||||||||
2012 Bridge Notes | |||||||||
Upon the completion of the Merger, $1,925,030 in bridge notes (the “2012 Bridge Notes”) converted into PPO Units. The holders of the 2012 Bridge Notes received 77,002 five-year bridge warrants (the “2012 Bridge Warrants”), each exercisable to purchase one share of the Company’s Common Stock. 38,501 of the 2012 Bridge Warrants were originally exercisable at $25.00 per share (the “Series A Warrants”) and 38,501 of the 2012 Bridge Warrants (the “Series B Warrants”) were originally exercisable at $50.00 per share. As of August 29, 2013, the Series A warrants were modified to be exercisable at $1.00 per share and the Series B warrants were modified to be exercisable at $1.50 per share. Except as to exercise price, the 2012 Bridge Warrants are identical, in all material respects to the Investor Warrants (as defined below). | |||||||||
Licensor Warrants | |||||||||
The Company also issued to the certain licensors warrants to purchase an aggregate of 100,000 shares of the Company’s common stock for a term of ten years at an original exercise price of $24.00 per share (the “Licensor Warrants”). The exercise price and number of shares of common stock issuable upon exercise of the Licensor Warrants may be adjusted in certain circumstances including stock splits and stock dividends (but excluding future issuances of the Company’s equity securities, regardless of whether or not such issuance is for no consideration or for consideration per share less than $24.00). The Licensor Warrants are exercisable on a cashless basis at any time prior to their expiration. Except as otherwise described herein, the Licensor Warrants are identical in all material respects to the Investor Warrants. On May 8, 2013, the Company reduced the exercise price of the Licensor Warrants to $12.00 in consideration of value received. | |||||||||
Private Placement Offering | |||||||||
Concurrently with the closing of the Merger, the Company completed an initial closing of a private placement offering (the “Offering”) wherein 5,000 units (the “PPO Units”) were sold, at a price of $25.00 per PPO Unit, for a total cash consideration of $125,000. Each PPO Unit consists of one share of the Company’s common stock and a warrant to purchase one share of the Company’s common stock (the “Investor Warrants”). The Investor Warrants are exercisable for a period of five years at a purchase price of $100.00 per share of the Company’s common stock. If at any time during the two year period following the closing of the Offering the Company issues additional shares of common stock for consideration per share of less than $25.00 (the “Reduced Price”), then the Company agreed to issue to the investors in the Offering, concurrently with such issue and without any additional consideration from the investors, a number of additional shares of the Company’s common stock and Investor Warrants equal to the difference between (A) the purchase price of the PPO Units being subscribed for divided by the Reduced Price and (B) the number of shares of the Company’s common stock included in the units being subscribed for in the subsequent offering. In addition, on July 12, 2012, the Company effected the conversion of $1,925,030 of the 2012 Bridge Notes. The 2012 Bridge Notes were converted into approximately 77,000 PPO Units and 77,000 five-year Investor Warrants each exercisable to purchase one share of the Company’s common stock. As of August 29, 2013, the Investor Warrants were modified to be exercisable at $3.00 per share. | |||||||||
On July 20, 2012, the Company completed the second closing of the Offering through the sale of 1,240 PPO Units (for aggregate gross proceeds of $31,000) consisting of 1,240 shares of common stock and 1,240 five-year Investor Warrants with an exercise price of $100.00. | |||||||||
On July 31, 2012, the Company completed the third closing of the Offering through the sale of approximately 16,400 PPO Units (for aggregate gross proceeds of $409,980) consisting of 16,400 shares of common stock and 16,400 five-year Investor Warrants with an exercise price of $100.00. | |||||||||
On August 24, 2012, the Company completed the fourth closing of the Offering through the sale of 5,000 PPO Units (for aggregate gross proceeds of $125,000) consisting of 5,000 shares of common stock and 5,000 five-year Investor Warrants with an exercise price of $100.00. | |||||||||
On September 10, 2012, the Company completed the fifth closing of the Offering through the sale of 800 PPO Units (for aggregate gross proceeds of $20,000) consisting of 800 shares of common stock and 800 five-year Investor Warrants with an exercise price of $100.00. | |||||||||
On December 6, 2012, the Company completed the sixth closing of the Offering through the sale of 6,000 PPO Units (for aggregate gross proceeds of $150,000) consisting of 6,000 shares of common stock and 6,000 five-year Investor Warrants with an exercise price of $100.00. | |||||||||
On December 10, 2012, the Company completed the seventh closing of the Offering through the sale of 2,000 PPO Units (for aggregate gross proceeds of $50,000) consisting of 2,000 shares of common stock and 2,000 five-year Investor Warrants with an exercise price of $100.00. | |||||||||
On December 12, 2012, the Company completed the eighth closing of the Offering through the sale of 1,000 PPO Units (for aggregate gross proceeds of $25,000) consisting of 1,000 shares of common stock and 1,000 five-year Investor Warrants with an exercise price of $100.00. | |||||||||
On February 8, 2013, the Company completed the ninth closing of the Offering through the sale of 2,000 PPO Units (for aggregate gross proceeds of $50,000) consisting of 200,000 shares of common stock and 2,000 five-year Investor Warrants with an exercise price of $100.00. | |||||||||
As of August 29, 2013, the Investor Warrants, aggregating to approximately 116,640 warrants, or the “Series C” Warrants, were modified to be exercisable at $3.00 per share. | |||||||||
In connection with the July 12, 2012 PPO closing, the Company issued an aggregate of approximately 6,560 five year broker warrants with an exercise price of $25.00 per share. Effective as of December 31, 2013, 1,200 broker warrants have been cancelled with the repurchase of 9,997 shares. In connection with the July 20, 2012, July 31, 2012, August 24, 2012, and September 10, 2012 closings, the Company issued an aggregate of 1,876 five-year broker warrants with an exercise price of $25.00 per share. In connection with the December 6, 2012, December 10, 2012, and December 12, 2012 closings, the Company issued an aggregate of 720 five-year broker warrants with an exercise price of $25.00 per share. In connection with the February 8, 2013 closing, the Company issued 160 five-year broker warrants with an exercise price of $25.00 per share. As of August 29, 2013, the broker warrants, aggregating to 8,516 warrants, were modified to be exercisable at $1.00 per share. | |||||||||
Short - Term Loans | |||||||||
In connection with two short-term notes that were issued on September 7, 2012 and an additional short-term note that the Company issued on September 24, 2012, for an aggregate principal amount of $300,000, the Company issued 1,200 warrants to holders of these notes (the “Series D Warrants”). These warrants are exercisable for a period of five years at a purchase price of $25.00 per share of the Company’s common stock. These warrants contain certain anti-dilution and other customary terms. | |||||||||
On March 28, 2013, in connection with a repayment of a short-term shareholder note, the Company issued an additional 1,500 five-year warrants to the holder to compensate the holder as the shareholder note was past due. The fair value of the warrants was $9,482 using a Black-Scholes model with the following assumptions: expected volatility of 70%, risk free interest rate of 0.83%, expected life of five years and no dividends. Expected volatility was based on the volatility of similar public entities in the beauty and personal care industry. The fair value of the warrants was recorded in the long-term liability and debt discount on the balance sheet. These warrants are exercisable for a period of five years at a purchase price of $25.00 per share of the Company’s common stock. These warrants contain certain anti-dilution and other customary terms. | |||||||||
As of August 29, 2013, the Series D warrants were modified to be exercisable at $1.00 per share. | |||||||||
Convertible Note Warrants | |||||||||
In connection with the Convertible Note offering on December 21, 2012, the Company issued 80,000 Convertible Note Warrants. 40,000 Convertible Note Warrants were exercisable at $50.00 and 40,000 Convertible Note Warrants were exercisable at $100.00. | |||||||||
The fair value of the warrants at issuance was estimated at $686,192 using a Black-Scholes model with the following assumptions: expected volatility of 60%, risk free interest rate of 0.95%, expected life of five years and no dividends. Expected volatility was based on the volatility of similar public entities in the beauty and personal care industry. The fair value of the warrants was recorded in the long-term liability and debt discount on the balance sheet. | |||||||||
In connection with the Convertible Note offering on March 28, 2013, the Company issued 45,200 Convertible Note Warrants. 22,600 Convertible Note Warrants are exercisable at $50.00 and 22,600 Convertible Note Warrants are exercisable at $25.00. | |||||||||
The relative fair value of the warrants at issuance was estimated at $222,457 using a Black-Scholes model with the following assumptions: expected volatility of 55%, risk free interest rate of 1.005%, expected life of five years and no dividends. Expected volatility was based on the volatility of similar public entities in the beauty and personal care industry. The relative fair value of the warrants was recorded in the long-term liability and debt discount on the balance sheet. | |||||||||
Convertible Note Broker Warrants | |||||||||
In connection with the Convertible Note offering, the Company issued 16,000 Convertible Note Broker Warrants. 8,000 Convertible Note Broker Warrants are exercisable at $50.00 and 8,000 Convertible Note Warrants are exercisable at $100.00. During the quarter ended March 31, 2013, the Company lowered the exercise price of the 80,000 Convertible Note Warrants issued as of December 21, 2012 from $100.00 to $50.00 and from $50.00 to $25.00 and lowered the exercise price of 16,000 Convertible Note Broker Warrants to $25.00. | |||||||||
The fair value of the warrants at issuance was estimated at $137,238 using a Black-Scholes model with the following assumptions: expected volatility of 60%, risk free interest rate of 0.95%, expected life of five years and no dividends. Expected volatility was based on the volatility of similar public entities in the beauty and personal care industry. The fair value of the warrants was recorded in the long-term liability and deferred financing cost on the balance sheet. | |||||||||
In connection with the Convertible Note offering on March 28, 2013, the Company issued 9,040 Convertible Note Broker Warrants. The Convertible Note Broker Warrants are exercisable at $25.00. | |||||||||
The relative fair value of the warrants at issuance was estimated at $57,143 using a Black-Scholes model with the following assumptions: expected volatility of 55%, risk free interest rate of 1.005%, expected life of five years and no dividends. Expected volatility was based on the volatility of similar public entities in the beauty and personal care industry. The relative fair value of the warrants was recorded in the long-term liability and debt discount on the balance sheet. | |||||||||
Debt Conversion Feature | |||||||||
The Convertible Note offering on December 21, 2012 included a Debt Conversion Feature (see Note 5). | |||||||||
The fair value of the Debt Conversion Feature was estimated, using Level 3 inputs, at $663,528 using a Black-Scholes model with the following assumptions: expected volatility of 60%, risk free interest rate of 0.95%, expected life of five years and no dividends. Expected volatility was based on the volatility of similar public entities in the beauty and personal care industry. | |||||||||
The relative fair value of the Debt Conversion Feature of the March 28, 2013 closing was estimated, using Level 2 inputs, at $50,240 using a Black-Scholes model with the following assumptions: expected volatility of 55%, risk free interest rate of 1.005%, expected life of five years and no dividends. Expected volatility was based on the volatility of similar public entities in the beauty and personal care industry. | |||||||||
June and August Convertible Note Warrants | |||||||||
In connection with the June Convertible Note offering on June 20, 2013, the Company issued approximately 247,060 June Convertible Note Warrants, which are exercisable at $8.20 and contain weighted average anti-dilution protections. | |||||||||
The fair value of the warrants at issuance was estimated at $752,126 using a Black-Scholes valuation model with the following assumptions: expected volatility of 55%, risk free interest rate of 1.685%, expected life of five years and no dividends. Expected volatility was based on the volatility of similar public entities in the beauty and personal care industry. The fair value of the warrants was recorded in the long-term liability and debt discount on the balance sheet. | |||||||||
In connection with the August Convertible Note offering on August 29, 2013, the Company issued approximately 90,590 August Convertible Note Warrants, which are exercisable at $8.20 and contain weighted average anti-dilution protections. | |||||||||
The fair value of the warrants at issuance was estimated at $85,293 using a Black-Scholes valuation model with the following assumptions: expected volatility of 65%, risk free interest rate of 1.9%, expected life of five years and no dividends. Expected volatility was based on the volatility of similar public entities in the beauty and personal care industry. The fair value of the warrants was recorded as a debt discount on the balance sheet. | |||||||||
June Convertible Note Broker Warrants | |||||||||
In connection with the June Convertible Note offering on June 20, 2013, the Company issued 19,122 Convertible Note Broker Warrants. The Convertible Note Broker Warrants are exercisable at $8.20. | |||||||||
The fair value of the warrants at issuance was estimated at $60,886 using a Black-Scholes valuation model with the following assumptions: expected volatility of 55%, risk free interest rate of 1.685%, expected life of five years and no dividends. Expected volatility was based on the volatility of similar public entities in the beauty and personal care industry. The fair value of the warrants was recorded in the long-term liability and deferred financing cost on the balance sheet. | |||||||||
Founder Warrants | |||||||||
In connection with the acquisition of the Third License on April 17, 2013, the Company issued 25,000 warrants. The warrants are exercisable at $13.00. | |||||||||
The fair value of the warrants at issuance was estimated at $210,349 using a Black-Scholes valuation model with the following assumptions: expected volatility of 55%, risk free interest rate of 1.685%, expected life of five years and no dividends. Expected volatility was based on the volatility of similar public entities in the beauty and personal care industry. The fair value of the warrants was recorded in the long-term liability and deferred financing cost on the balance sheet. | |||||||||
Consultant Warrants | |||||||||
On April 8, 2013, the Company issued 5,000 five-year warrants with an exercise price of $25.00 to a consultant, engaged effective as of the same date for consulting services to the Company. The warrants shall vest ratably in arrears over six 30-day periods beginning on April 8, 2013, with one-sixth of the warrants vesting on each successive thirtieth day following April 8, 2013, subject to the termination of the consulting agreement prior thereto. | |||||||||
The fair value of the warrants at issuance was estimated at $42,625 using a Black-Scholes valuation model with the following assumptions: expected volatility of 65%, risk free interest rate of 1.57%, expected life of five years and no dividends. Expected volatility was based on the volatility of similar public entities in the beauty and personal care industry. The fair value of the warrants was recorded in the long-term liability and deferred financing cost on the balance sheet. | |||||||||
Debt Conversion Feature | |||||||||
The June and August Convertible Note offerings included a Debt Conversion Feature (see Note 5). | |||||||||
The fair value of the Debt Conversion Feature of the June 20, 2013 closing was estimated, using Level 3 inputs, at $491,051 using a Black-Scholes model with the following assumptions: expected volatility of 55%, risk free interest rate of 1.685%, expected life of eighteen months and no dividends. Expected volatility was based on the volatility of similar public entities in the beauty and personal care industry. | |||||||||
The fair value of the Debt Conversion Feature of the August 29, 2013 closing was estimated, using Level 3 inputs, at $25,827 using a Black-Scholes model with the following assumptions: expected volatility of 65%, risk free interest rate of 1.9%, expected life of eighteen months and no dividends. Expected volatility was based on the volatility of similar public entities in the beauty and personal care industry. | |||||||||
Fair Value Measurement | |||||||||
The fair value at issuance of those warrants granted during the quarter ended September 30, 2012 was estimated at $3,788,687 using a Black-Scholes model with the following assumptions: expected volatility of 70%, risk free interest rate of 0.83%, expected life of 5.0 – 10.0 years, based upon the term of the warrant, and no dividends. Expected volatility was based on the volatility of similar public entities in the beauty and personal care industry. The fair value of the warrants was recorded in the long-term liability section of the balance sheet. | |||||||||
The fair value at issuance of those warrants granted during the quarter ended December 31, 2012 was $888,596 using a Black-Scholes model with the following assumptions: expected volatility of 60%, risk free interest rate of 0.95%, expected life of 0.8 - 5.0 years, based upon the term of the warrant, and no dividends. Expected volatility was based on the volatility of similar public entities in the beauty and personal care industry. The fair value of the warrants was recorded in the long-term liability section of the balance sheet. | |||||||||
The fair value at issuance of those warrants granted during the quarter ended March 31, 2013 was estimated at $297,716 using a Black-Scholes model with the following assumptions: expected volatility of 55%, risk free interest rate of 1.005%, expected life of 5.0 years, based upon the term of the warrant, and no dividends. Expected volatility was based on the volatility of similar public entities in the beauty and personal care industry. The fair value of the warrants was recorded in the long-term liability section of the balance sheet. | |||||||||
The fair value at issuance of those warrants granted during the quarter ended June 30, 2013 was estimated at $1,067,196 using a Black-Scholes model with the following assumptions: expected volatility of 55%, risk free interest rate of 1.685%, expected life of eighteen months to 10 years, based upon the term of the warrant, and no dividends. Expected volatility was based on the volatility of similar public entities in the beauty and personal care industry. The fair value of the warrants was recorded in the long-term liability section of the balance sheet. | |||||||||
The fair value at issuance of those warrants granted during the quarter ended September 30, 2013 was estimated at $155,716 using a Black-Scholes model with the following assumptions: expected volatility of 65%, risk free interest rate of 1.57% -1.90%, expected life of eighteen months to five years, based upon the term of the warrant, and no dividends. Expected volatility was based on the volatility of similar public entities in the beauty and personal care industry. The fair value of the warrants was recorded in the long-term liability section of the balance sheet. | |||||||||
The Company’s warrant liability was valued at December 31, 2013 using a Black-Scholes valuation model with the following assumptions: expected volatility of 80%, risk free interest rate of 2.1%, expected life of fourteen months – 10 years, based upon the term of the warrant or convertible note, and no dividends. Expected volatility was based on the volatility of similar public entities in the beauty industry. | |||||||||
The Company’s warrant liability was valued at March 31, 2014 using a Black-Scholes valuation model with the following assumptions: expected volatility of 73%, risk free interest rate of 2.015%, expected life of fifteen months – 9.1 years, based upon the term of the warrant or convertible note, and no dividends. Expected volatility was based on the volatility of the Company’s stock price since inception. The following table is a roll forward of the fair value of the warrant liability: | |||||||||
March 31, | June 30, | ||||||||
2014 | 2013 | ||||||||
Beginning Balance | $ | 1,660,440 | $ | 0 | |||||
Issuance of Warrants | 224,899 | 7,252,283 | |||||||
Repurchase / Exercise / Cancellation of Warrants | (57,129 | ) | (179,884 | ) | |||||
Change in fair value | (1,708,651 | ) | (5,411,959 | ) | |||||
Ending Balance | $ | 119,559 | $ | 1,660,440 | |||||
The fair value of the Company’s outstanding warrants and derivative instruments was estimated at $119,559 and $1,660,440 as of March 31, 2014 and June 30, 2013. The (gain) / loss in the fair value of the warrants of $(1,708,651) for the nine months ended March 31, 2014 was recognized as a (gain) / loss in the derivative liability section on the accompanying condensed consolidated statement of operations. The (gain) / loss in the repurchase / exercise / cancellation of the warrants of $(57,129) was recognized in the loss from conversion of debt section on the accompanying condensed consolidated statement of operations. |
Loss_from_Debt_Extinguishment
Loss from Debt Extinguishment | 9 Months Ended |
Mar. 31, 2014 | |
Extinguishment of Debt Disclosures [Abstract] | ' |
LOSS FROM DEBT EXTINGUISHMENT | ' |
NOTE 7. LOSS FROM DEBT EXTINGUISHMENT | |
On March 31, 2014, the Company effected the conversion of the principal of the June and August Convertible Notes of $1,953,143 and June and August Convertible Note Warrants into convertible preferred stock (the “Series A Preferred Stock”). As a result of such conversion, the Company issued 3,906 Series A Preferred Stock shares. The Series A Preferred Stock has a stated value of $1,000 per share. The Series A Preferred Stock converts into Common Stock at the lower of a) $6.80 per share or b) the Common Stock share price at the next round of financing greater than $3.0 million (“Preferred Conversion Price”). The instrument contains an annual dividend of 8% payable quarterly in cash or in Common Stock at the Preferred Conversion Price. The 8% dividend expires upon the next round of financing greater than $3.0 million. The Series A Preferred limits the ability of the Company to incur additional indebtedness, buy-back shares, pay cash dividends or distributions to Common Stock holders. | |
In addition, the Company accelerated the amortization of debt discount and deferred financing costs related to the conversion of the June and August Convertible Notes and wrote down the value of the associated June and August Convertible Warrants and Beneficial Conversion Features. Accordingly, the Company has recognized a net charge related to the debt discount and deferred financing costs of $807,780, which is recorded under Loss from Extinguishment of Debt in the accompanying statement of operations for the three and nine months ended March 31, 2014. | |
In evaluating the accounting for the debt exchange and the fair value of the preferred securities, Management was required to evaluate the difference between the carrying value of the exchanged June and August Convertible Notes and the fair value of the Series A Preferred Stock. In accordance with ASC Topic 820, Fair Value Measurements, guidance related to Level 3 fair value measures, Management performed various analyses with regard to the valuation of the Series A Preferred Stock. Level 3 fair value measures are valuations that are derived primarily from unobservable inputs and rely heavily on management assessments, assumptions, and judgments. In determining the fair value of the newly issued instruments, the Company performed an internal analysis using the Company’s enterprise valuation as a public company, waterfall analysis and private equity valuations to test the face value of the Series A Preferred Stock. Furthermore, the Company recognized a loss to record the difference in the fair value of all securities and other consideration transferred to the June and August Convertible Note Holders in excess of the fair value of the consideration issuable in accordance with the original conversion terms. Applying extinguishment accounting guidance, the Company recognized a non-cash loss of $1,952,861, which is recorded under Loss from Extinguishment of Debt, at the time of the exchange for the difference between the carrying value of the exchanged notes and the fair value of the newly issued securities. | |
The value of the Series A Preferred Stock is presented as Mezzanine Equity, in the accompanying condensed consolidated balance sheet as of March 31, 2014, as the preferred instrument is a non-callable until the Company meets minimum share price and volume requirements. In addition, the Series A Preferred Stock has a contingent conversion feature, which re-sets the conversion price upon the event of a financing greater than $3 million. The Series A Preferred Stock contains provisions that would require mandatory redemption upon certain events of default, as defined in the Preferred Stock Certificate of Designation. | |
The Company did not have any expenses related to the Loss from Extinguishment of Debt for the nine months ended March 31, 2013. |
Commitments_and_Contingencies
Commitments and Contingencies | 9 Months Ended | |
Mar. 31, 2014 | ||
Commitments and Contingencies Disclosure [Abstract] | ' | |
COMMITMENTS AND CONTINGENCIES | ' | |
NOTE 8. COMMITMENTS AND CONTINGENCIES | ||
License Agreements | ||
On May 9, 2012, the Company entered into a licensing agreement with the Licensors (see Note 3 for further detail). | ||
During the term of the licensing agreement the Company has agreed to pay a guaranteed minimum royalty payment of $4,686,125 or $4,985,000 over the life of the agreement, depending on the launch date of various products in accordance with the following schedule and subject to annual minimum amounts. With regards to the license and the ongoing payments, the Company is in negotiations with re-scheduling the payment dates. | ||
· | Contract period two: $925,000 or $1,000,000 | |
Contract period three: $1,188,625 or $1,285,000 | ||
· | Contract period four: $1,572,500 or $1,700,000 | |
On July 11, 2012, the Company entered into the Second License (see Note 3). The Company agreed to pay a guaranteed minimum royalty payment of $600,000 over the life of the agreement, depending on the launch date of various products in accordance with the following schedule and subject to annual minimum amounts. With regards to the license and the ongoing payments, the Company is in negotiations with re-scheduling the payment dates. | ||
· | Contract period two: $225,000 | |
· | Contract period three: $275,000 | |
On April 25, 2013, the Company entered into a licensing agreement with the Third Licensor (see Note 3). The Company agreed to pay a guaranteed minimum royalty payment of $100,000 over the life of the agreement, depending on the launch date of various products in accordance with the following schedule and subject to annual minimum amounts. With regards to the license and the ongoing payments, the Company is in negotiations with re-scheduling the payment dates. | ||
· | Contract period two: $33,333 | |
· | Contract period three: $33,334 | |
The Company has recognized $815,370 in accrued expenses for the minimum royalty payments earned to date on the three licensing agreements. | ||
Operating Lease | ||
On May 8, 2012, the Company executed a one-year operating lease for its corporate office commencing on May 15, 2012 at a monthly rent payment of $1,785 per month. Total rent expense related to this operating lease was $14,280 and $16,065 for the nine months ended March 31, 2014 and March 31, 2013, respectively, and is included in general and administrative expenses in accompanying statement of operations. Total rent expense related to this operating lease was $3,570 and $5,355 for the three months ended March 31, 2014 and March 31, 2013. As of February 28, 2014, the Company terminated this operating lease. | ||
On January 7, 2013, the Company executed a five-month operating lease for storage commencing on January 1, 2013 at a monthly rent payment of $1,500 per month. Total rent expense related to this operating lease was $12,000 and $4,500 for the nine months ended March 31, 2014 and March 31, 2013, respectively, and is included in general and administrative expenses in accompanying statement of operations. Total rent expense related to this operating lease was $3,000 and $4,500 for the three months ended March 31, 2014 and March 31, 2013, respectively. As of February 28, 2014, the Company terminated this operating lease. | ||
On March 1, 2014, the Company executed a month-to-month operating lease for its new corporate office commencing on March 1, 2014 at a monthly rent payment of $3,100 per month. Total rent expense related to this operating lease was $3,100 and $0 for the nine months ended March 31, 2014 and March 31, 2013, respectively, and is included in general and administrative expenses in accompanying statement of operations. Total rent expense related to this operating lease was $3,100 and $0 for the three months ended March 31, 2014 and March 31, 2013, respectively. | ||
Litigation | ||
In the normal course of business, the Company may become involved in various legal proceedings. Except as described below, management knows of no pending or threatened legal proceeding to which they are or will be a party and which, if successful, might result in a material adverse change in our business, properties or financial condition. | ||
On November 19, 2012, an action entitled Chroma Makeup Studio, LLC. v. BOLDFACE Group, Inc. and BOLDFACE Licensing + Branding was filed in the United States District Court for the Central District of California, Western Division (the “Court”). Chroma Makeup Studio, LLC (“Chroma”) alleged that the Company’s use of the term Khroma, including the marks Khroma Beauty and Khroma Beauty By Kourtney, Kim and Khloe (the “Khroma Beauty Marks”), for cosmetics is infringing upon Chroma's rights in its Chroma mark. The Complaint included claims for trademark infringement under the Lanham Act and unfair competition under applicable California law. The Court set a tentative trial date of April 22, 2014. The parties also agreed to pursue private mediation in an attempt to resolve the disputed issues in this case. On November 7, 2013, following private mediation, the parties agreed to settle the action and are currently negotiating the terms of a written settlement agreement. On December 11, 2013, the Company entered into a settlement agreement and mutual general release (the “Settlement Agreement”) with Chroma to settle any and all claims between the Company and Chroma. Pursuant to the terms of the Settlement Agreement, the parties have agreed that the terms of the Settlement Agreement are to remain confidential. Pursuant to the terms of the Settlement Agreement, and with no admission of any liability, the Company has agreed to pay Chroma a cash amount over a period of one year commencing on December 31, 2013 and ending on December 31, 2014. The total cash amount that the Company has agreed to pay Chroma is lower than the amount the Company reserved for any payments to be made in connection the dispute. | ||
On November 30, 2012, BLB filed a complaint for a declaratory judgment in the United States District Court for the Central District of California, Western Division entitled BOLDFACE Licensing + Branding v. By Lee Tillett, Inc. (“Tillett”). BLB’s complaint requests a declaration from the Court that (1) BLB’s use of the Khroma term, including the Khroma Beauty marks does not infringe on Tillett’s rights in its Kroma trademark, and (2) BLB’s two pending trademark applications for Khroma Beauty marks should be allowed to register with the USPTO. On January 9, 2013 Tillet filed an answer and counterclaims for (1) trademark infringement, (2) false designation of origin, (3) trademark infringement, and (4) unfair competition pursuant. In addition to BLB, Tillett's Counterclaims are made against the following additional parties: Kims a princess Inc., 2Die4Kourt Inc., Khlomoney Inc., and individuals Kim Kardashian, Kourtney Kardashian, and Khloe Kardashian (collectively, the "Kardashian Parties"). | ||
In March 2013, Tillet obtained a preliminary injunction enjoining BLB’s use of the Khroma Beauty mark. In response to the injunction issued by the court, the Company filed a notice of appeal with the Ninth Circuit Court of Appeals (the “9th Circuit”) on March 15, 2013 to overturn the district court’s March 11, 2013 decision. On March 18, 2013, the Company also filed a motion to stay with the 9th Circuit, requesting a stay of the injunction during the pendency of the Company’s appellate case. The 9th Circuit ruled on the Company’s motion on June 7, 2013 granting Tillett’s application and ruling that the preliminary injunction would be effective as of June 7, 2013. | ||
In early May 2013, however, after further unsuccessful settlement negotiations with Tillett, Boldface decided to change the name of its brand to KARDASHIAN BEAUTY. In August, Boldface filed a withdrawal of the appeal and agreed to stipulate to a permanent injunction that it would not use the KHROMA BEAUTY Marks. | ||
All parties, as of June 2, 2014, entered into a Settlement Agreement and Mutual General Release to settle all disputes. On June 4, 2014, in connection with the entering of the Settlement Agreement and Mutual General Release, Judge Audrey B. Collins dismissed the Action without prejudice. | ||
Based on the expressed willingness of BLB to settle the cases and the likely cost to continuing litigation, the Company has accrued for total settlement costs of less than $800,000 for any potential settlement offers and related costs. | ||
Registration Agreement | ||
The Company had approximately 3,000,000, shares of common stock authorized. As of March 31, 2014, the Company had 1,576,976 shares issued and 1,566,979 shares outstanding. | ||
Each share of common stock entitles the holder to one vote on all matters submitted to a vote of the Company's stockholders. Common stockholders are not entitled to receive dividends unless declared by the Company's Board of Directors. | ||
PPO Offering Registration Rights | ||
In connection with the Merger and Offering (as defined in Notes 1 and 6), the Company entered into a registration rights agreement (the “Registration Rights Agreement”) with each of the investors participating in the Offering. Under the Registration Rights Agreement, as amended, the Company committed to file a registration statement on Form S-1, or other applicable form (the “Registration Statement”), covering the resale of (i) the Company’s common stock underlying the Bridge Warrants (as defined in Note 6), (ii) common stock underlying the PPO Units (as defined in Note 6) sold or to be sold in the Offering, and (iii) common stock underlying the Investor Warrants (as defined in Note 6) (including securities issued in the Offering as a result of the conversion of the 2012 Bridge Notes (as defined in Note 6), but not common stock that is issuable upon exercise of the broker warrants issued to the placement agent for the Offering) (collectively, the “Registrable Securities”) no later than October 29, 2012 (the “Filing Date”), and to use commercially reasonable efforts to cause the Registration Statement to become effective no later than 150 days after it is filed (the “Effectiveness Date”). As of the date of this Quarterly Report the Company has not filed the Registration Statement with the SEC. The Company agreed to use its commercially reasonable efforts to maintain the effectiveness of the Registration Statement for at least one year from the date the Registration Statement is declared effective by the SEC or for such shorter period ending on the earlier to occur of (i) until Rule 144 of the Securities Act is available to investors with respect to all of their Registrable Securities or (ii) the date when all of the Registrable Securities registered thereunder shall have been sold. | ||
The Company will be liable for liquidated damages at the rate of 1% of the purchase price per PPO Unit paid by each investor for the Registrable Securities then held by such investor for each full period of 30 days for which the Company fails to file the registration statement by the Filing Date or if the Company fails to have the Registration Statement declared effective by the Effectiveness Date (each, a “Registration Event”), until such failure is cured. The payment amount shall be prorated for partial 30-day periods. The aggregate penalty accrued with respect to each investor may not exceed 10% of the original purchase price paid by such investor. However, if a Registration Event occurs (or is continuing) on a date more than one year after July 12, 2012 or the final closing of the Offering, liquidated damages shall be paid only with respect to that portion of the Registrable Securities that cannot then be immediately resold in reliance on Rule 144. If the Company fails to pay any partial liquidated damages or refund pursuant in full within seven days after the date payable, the Company will pay interest thereon at a rate of 8% per annum (or such lesser maximum amount that is permitted to be paid by applicable law) to the holder of the PPO Unit. | ||
In December 2006, the FASB issued guidance on accounting for registration payment arrangements. This guidance specifies that the contingent obligation to make future payments or otherwise transfer consideration under a registration payment arrangement, whether issued as a separate agreement or included as a provision of a financial instrument or other agreement, should be separately recognized and measured in accordance with FASB guidance on accounting for contingencies. This guidance further clarifies that a financial instrument subject to a registration payment arrangement should be accounted for in accordance with GAAP without regard to the contingent obligation to transfer consideration pursuant to the registration payment arrangement. The Company applied the recognition and measurement provisions of the FASB guidance to the registration rights associated with the Registration Rights Agreement. | ||
The Amendment Agreements also provided for a waiver of all penalties incurred by the Company under the terms of the PPO registration rights agreement as a result of the Company’s failure to timely file and effect the registration for resale of the private placement securities. | ||
Aegis Convertible Note Offering Registration Rights | ||
In connection with two closings of convertible note offerings in December 2012 and March 2013, the Company also entered into a registration rights agreement with the Investors (the “Convertible Note Registration Rights Agreement”). Under the terms of the Convertible Note Registration Rights Agreement, the Company committed to file a registration statement on Form S-1, or other applicable form, covering the resale of (i) the Common Stock underlying the Warrants and (ii) the Common Stock underlying the Notes (collectively, the “Convertible Note Registrable Securities”) within 45 days from the final closing of the Offering (the “Filing Date”), and to use its commercially reasonable efforts to cause the registration statement to become effective no later than 90 days after it is filed (the “Effectiveness Date”). | ||
The Company agreed to use its commercially reasonable efforts to maintain the effectiveness of the registration statement for at least one year from the date the registration statement is declared effective by the SEC or for such shorter period ending on the earlier to occur of (i) until Rule 144 of the Securities Act of 1933, as amended (the “Securities Act”), is available to Investors with respect to all of their Convertible Note Registrable Securities or (ii) the date when all of the Convertible Note Registrable Securities registered thereunder shall have been sold. The Company will be liable for monetary penalties equal to 0.5% of the purchase price per Unit paid by such Investor for the Convertible Note Registrable Securities then held by each investor for each full period of period of 30 days if the Company fails to file the registration statement by the Filing Date or if the Company fails to use its reasonable efforts to have the registration statement declared effective by the Effectiveness Date until such failure is cured. The payment amount shall be prorated for partial 30-day periods. The maximum aggregate amount of payments to be made by the Company as the result of such failures, whether by reason of a filing deadline failure, effectiveness deadline failure or any combination thereof, shall be an amount equal to 6% of the purchase price per Unit paid by such Investor for the Convertible Note Registrable Securities held by such Investor at the time of the first occurrence of such failure to file with, or to have the registration statement be declared effective by, the United States Securities and Exchange Commission (the “SEC”). | ||
Moreover, no such payments shall be due and payable with respect to any Convertible Note Registrable Securities that the Company is unable to register due to limits imposed by the SEC’s interpretation of Rule 415 under the Securities Act. The holders of any Convertible Note Registrable Securities removed from the registration statement as the result of a Rule 415 comment or other comment from the SEC shall have “piggyback” registration rights for the shares of Common Stock underlying the Convertible Note Registrable Securities, until such shares can be sold without limitation under Rule 144, with respect to any registration statement filed by the Company following the effectiveness of the registration statement which would permit the inclusion of these shares. | ||
During the period ended March 31, 2014, the Company has recorded total liabilities of $206,381 in accrued expenses on the accompanying condensed consolidated balance sheet associated with the above registration rights. |
Equity_Transactions
Equity Transactions | 9 Months Ended |
Mar. 31, 2014 | |
Equity Transactions [Abstract] | ' |
EQUITY TRANSACTIONS | ' |
NOTE 9. EQUITY TRANSACTIONS | |
On October 3, 2013, the Company issued 1,000 shares of common stock to a third party for consulting services provided, fair valued at $2,490. | |
On March 31, 2014, the Company issued 7,441 shares of common stock to a board member per the compensation package of said board member, fair valued at $6,250. |
Stock_Compensation_Expense_and
Stock Compensation Expense and Fair Value Measurement | 9 Months Ended | ||||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||||
Stock Compensation Expense and Fair Value Measurement [Abstract] | ' | ||||||||||||||||||||
STOCK COMPENSATION EXPENSE AND FAIR VALUE MEASUREMENT | ' | ||||||||||||||||||||
NOTE 10. STOCK COMPENSATION EXPENSE AND FAIR VALUE MEASUREMENT | |||||||||||||||||||||
In July 2012, the Company's Board of Directors adopted the 2012 Stock Option and Incentive Plan (the "2012 Equity Incentive Plan"). The 2012 Equity Incentive Plan provides for the grants of incentive and non-qualified stock options, restricted stock and other equity awards to employees, officers, directors, consultants and advisors of the Company. Provisions such as vesting, repurchase and exercise conditions, and limitations are determined by the Board of Directors on the grant date. There are 200,000 shares of the Company’s Common Stock reserved for issuance under its 2012 Equity Incentive Plan. | |||||||||||||||||||||
As of March 31, 2014, the Company has issued an aggregate of 177,800 common shares for future issuance upon exercise of outstanding and future grants of common stock options and future issuances of restricted stock awards pursuant to the Company's 2012 Equity Incentive Plan. | |||||||||||||||||||||
Effective as of July 12, 2012 the Company issued 46,000 stock options under its 2012 Equity Incentive Plan to the Company’s CEO, a consultant and the Chairman of the Board of Directors; 36,000 of which have a five-year term and 10,000 of which have a ten-year term. All of the options are exercisable for the purchase of one share of the Company’s common stock at an exercise price of $24.00 per share. Such options, which will vest annually at a rate of 33% beginning on the first anniversary date of the Merger, in each case, if the grantee remains employed by the Company or any of its subsidiaries on each annual vesting date. As of March 31, 2014, 10,000 options have been forfeited. | |||||||||||||||||||||
Effective as of August 15, 2012 the Company issued 4,000 stock options under its 2012 Equity Incentive Plan to certain of the Company’s employees and consultants. All of the options have a ten-year term and are exercisable for the purchase of one share of the Company’s common stock at an exercise price of $24.00 per share. Vesting on these awards is a three-year period. Such options, which will vest annually at a rate of 33% beginning on the first anniversary date of the grant, in each case, if the grantee remains employed by the Company or any of its subsidiaries on each annual vesting date. As of March 31, 2014, 25 options have been forfeited. | |||||||||||||||||||||
Effective as of November 21, 2012 the Company issued 5,000 stock options under its 2012 Equity Incentive Plan to the Company’s newly appointed director. All of the options have a ten-year term and are exercisable for the purchase of one share of the Company’s common stock at an exercise price of $24.00 per share. Vesting on these awards is a three-year period. Such options, which will vest annually at a rate of 33% beginning on the first anniversary date of the grant, in each case, if the grantee remains employed by the Company or any of its subsidiaries on each annual vesting date. | |||||||||||||||||||||
Effective as of March 28, 2013 the Company issued 5,000 stock options under its 2012 Equity Incentive Plan to the Company’s newly appointed director. All of the options have a ten-year term and are exercisable for the purchase of one share of the Company’s common stock at an exercise price of $17.00 per share. Vesting on these awards is a three-year period. Such options, which will vest annually at a rate of 33% beginning on the first anniversary date of the grant, in each case, if the grantee remains employed by the Company or any of its subsidiaries on each annual vesting date. | |||||||||||||||||||||
Effective as of April 8, 2013 the Company issued 5,000 stock options under its 2012 Equity Incentive Plan to the Company’s newly appointed director. All of the options have a ten-year term and are exercisable for the purchase of one share of the Company’s common stock at an exercise price of $14.00 per share. Vesting on these awards is a three-year period. Such options, which will vest annually at a rate of 33% beginning on the first anniversary date of the grant, in each case, if the grantee remains employed by the Company or any of its subsidiaries on each annual vesting date. | |||||||||||||||||||||
Effective as of June 28, 2013 the Company issued 5,000 stock options under its 2012 Equity Incentive Plan to two of the Company’s directors pursuant to the Company’s board compensation package, effective as of March 15, 2013. All of the options have a ten-year term and are exercisable for the purchase of one share of the Company’s common stock at an exercise price of $5.00 per share. Vesting on these awards is a three-year period. Such options, which will vest annually at a rate of 33% beginning on the first anniversary date of the grant, in each case, if the grantee remains employed by the Company or any of its subsidiaries on each annual vesting date. | |||||||||||||||||||||
Effective as of July 12, 2013 the Company issued 114,000 stock options under its 2012 Equity Incentive Plan to the Company’s CEO and a consultant. The options have a five-year term. All of the options are exercisable for the purchase of one share of the Company’s common stock at an exercise price of $6.00 per share. Such options, which will vest annually at a rate of 33% beginning on the first anniversary of the grant date, if the grantee remains employed by the Company or any of its subsidiaries on each annual vesting date. | |||||||||||||||||||||
Effective as of August 15, 2013 the Company issued 13,575 stock options under its 2012 Equity Incentive Plan to certain of the Company’s employees and consultants. All of the options have a ten-year term and are exercisable for the purchase of one share of the Company’s common stock at an exercise price of $5.00 per share. Vesting on these awards is a three-year period. Such options, which will vest annually at a rate of 33% beginning on the first anniversary date of the grant, in each case, if the grantee remains employed by the Company or any of its subsidiaries on each annual vesting date. | |||||||||||||||||||||
As of March 31, 2014, 15,275 stock options had been forfeited. | |||||||||||||||||||||
The fair value of each stock option grant was estimated on the date of grant using the Black-Scholes option-pricing model. The expected life assumption is based on the estimated forfeiture rate. Expected volatility is based on a blend of the volatility of the Company. The risk-free interest rate is the yield currently available on U.S. Treasury five-year and seven-year zero-coupon issues approximating the expected term used as the input to the Black-Scholes model. FASB accounting guidance requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods as options vest, if actual forfeitures differ from those estimates. During the nine months ended March 31, 2014, because substantially all of the Company's stock option grants vest annually, stock-based employee compensation expense includes the actual impact of forfeitures. No stock options are exercisable as of March 31, 2014. The relevant inputs used to determine the value of the stock option grants is as follows: | |||||||||||||||||||||
Number of | Weighted | Expected | Expected | Expected | |||||||||||||||||
options | average | life in years | volatility | dividends | |||||||||||||||||
outstanding | risk-free rate | ||||||||||||||||||||
12-Jul-12 | 36,000 | 0.83 | % | 3.5 | 70 | % | 0 | % | |||||||||||||
15-Aug-12 | 3,975 | 0.83 | % | 6 | 70 | % | 0 | % | |||||||||||||
21-Nov-12 | 5,000 | 0.95 | % | 6 | 60 | % | 0 | % | |||||||||||||
28-Mar-13 | 0 | 1.005 | % | 6 | 55 | % | 0 | % | |||||||||||||
8-Apr-13 | 5,000 | 1.685 | % | 6 | 55 | % | 0 | % | |||||||||||||
28-Jun-13 | 250 | 1.685 | % | 6 | 55 | % | 0 | % | |||||||||||||
12-Jul-13 | 114,000 | 1.715 | % | 3.5 | 65 | % | 0 | % | |||||||||||||
15-Aug-13 | 13,575 | 1.86 | % | 6 | 65 | % | 0 | % | |||||||||||||
Total | 177,800 | ||||||||||||||||||||
The fair value of the Company’s outstanding options issued to non-employees was $1,042 as of March 31, 2014. These options were valued at March 31, 2014 using a Black-Scholes model with Level 3 inputs. Expected volatility was based on the Company’s volatility from inception through March 31, 2014. | |||||||||||||||||||||
As a result, share-based compensation expense totaled $333,856 and $452,087 for the nine months ended March 31, 2014 and March 31, 2013, respectively, and is recorded in general and administrative expenses. Share-based compensation expense totaled $147,436 and $162,808 for the three months ended March 31, 2014 and March 31, 2013, respectively. |
Income_Taxes
Income Taxes | 9 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Income Taxes [Abstract] | ' | ||||||||
INCOME TAXES | ' | ||||||||
NOTE 11. INCOME TAXES | |||||||||
The Company did not incur any income tax expense for the three and nine months ended March 31, 2014. At March 31, 2014, $4,875,422 of federal and state tax assets arising from net operating losses were available to the Company to offset future taxable income, which will expire in 2033. Given the short history of the Company and the uncertainty as to the likelihood of future taxable income, the Company has recorded a 100% valuation reserve against the anticipated recovery from the use of the net operating losses created at the inception or generated thereafter. The Company will evaluate the appropriateness of the valuation allowance on an annual basis and adjust the allowance as considered necessary. | |||||||||
The Company’s effective tax rate differs from the federal statutory rate of 34% primarily due to the impact of state income taxes and the valuation allowance recorded against its deferred tax assets. | |||||||||
March 31, | |||||||||
2014 | |||||||||
Statutory rate | 34 | % | |||||||
State income taxes | 5.8 | % | |||||||
Permanent differences | 2.3 | % | |||||||
Valuation allowance | (42.5 | )% | |||||||
Other | 0.4 | % | |||||||
Total | 0 | % | |||||||
The principal components of deferred tax assets and (liabilities) are as follows as of March 31, 2014 and June 30, 2013 on a tax effected basis: | |||||||||
March 31, | June 30, | ||||||||
2014 | 2013 | ||||||||
Net operating losses carryforward | $ | 4,197,125 | $ | 2,002,842 | |||||
Start-up costs and fixed assets, net of amortization | 120,011 | 60,005 | |||||||
Property and equipment | 159,025 | 56,270 | |||||||
Stock based compensation | 399,261 | 192,786 | |||||||
Gross deferred taxes | $ | 4,875,422 | $ | 2,311,903 | |||||
Valuation allowance | (4,875,422 | ) | (2,311,903 | ) | |||||
Net deferred taxes | $ | - | $ | - | |||||
The Company follows the provisions of FASB ASC Subtopic 740-10-65-1, Income Taxes. As of March 31, 2014 and June 30, 2013, respectively, the Company did not recognize any liability for unrecognized tax benefits. | |||||||||
Section 382 of the Internal Revenue Code can limit the amount of net operating losses, which may be utilized if certain changes to a company’s ownership occur. While the Company underwent a shift in ownership in 2013 as defined by Section 382 of the Internal Revenue Code, the Company has not incurred any limitations on its ability to utilize its net operating losses under Section 382 of the Internal Revenue Code, it may incur limitations in the future if there is a change in ownership. | |||||||||
The Company recognizes interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. No such interest or penalties were recognized during the period presented. The Company had no accruals for interest and penalties at March 31, 2014. There are no income tax examinations currently in process and as of the date of this report. |
Related_Party_Transactions
Related Party Transactions | 9 Months Ended |
Mar. 31, 2014 | |
Related Party Transactions [Abstract] | ' |
RELATED PARTY TRANSACTIONS | ' |
NOTE 12. RELATED PARTY TRANSACTIONS | |
The Company entered into a consulting agreement with Gold Grenade, LLC (“Gold Grenade”), a related entity co-owned by two shareholders to receive product development services. As of March 31, 2014 and March 31, 2013, $234,550 and $0, respectively, was due to Gold Grenade. For the nine months ended March 31, 2014 and March 31, 2013, the Company incurred approximately $640,000 and $622,700 respectively, in product development fees payable to Gold Grenade. For the three months ended March 31, 2014 and March 31, 2013, the Company incurred approximately $140,000 and $210,000 respectively, in product development fees payable to Gold Grenade. The agreement was terminated as of February 28, 2014. |
Subsequent_Events
Subsequent Events | 9 Months Ended |
Mar. 31, 2014 | |
Subsequent Events [Abstract] | ' |
SUBSEQUENT EVENTS | ' |
NOTE 13. SUBSEQUENT EVENTS | |
On June 5, 2014, the Company entered into an Original Issue Discount Promissory Note for eighty thousand dollars ($80,000) with a maturity date of July 6, 2014 (the “OID Note”). If any Event of Default (as defined in the OID Note) occurs, the full principal amount shall become, at the lender’s election, immediately due and payable in cash. Commencing two (2) days after the occurrence of any Event of Default that results in the acceleration of the OID Note, the interest rate on the OID Note shall accrue at the rate of eighteen (18) percent per annum, or such lower maximum amount of interest permitted to be charged under applicable law. | |
On June 18, 2014, the Company entered into an Original Issue Discount Promissory Note for sixty thousand dollars ($60,000) with a maturity date of July 18, 2014 (the “Second OID Note”). If any Event of Default (as defined in the Second OID Note) occurs, the full principal amount shall become, at the lender’s election, immediately due and payable in cash. Commencing two (2) days after the occurrence of any Event of Default that results in the acceleration of the OID Note, the interest rate on the OID Note shall accrue at the rate of eighteen (18) percent per annum, or such lower maximum amount of interest permitted to be charged under applicable law. |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 9 Months Ended | ||||
Mar. 31, 2014 | |||||
Summary of Significant Accounting Policies [Abstract] | ' | ||||
Basis of Consolidation | ' | ||||
Basis of Consolidation | |||||
The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary BLB. All significant intercompany balances and transactions are eliminated in consolidation. | |||||
Method of Accounting | ' | ||||
Method of Accounting | |||||
The Company maintains its accounting records on the accrual method of accounting in conformity with GAAP. As of September 30, 2013, the Company reclassified the presentation of freight-out expenses of $72,705 and $335,232 for the three and nine months ended March 31, 2013, respectively, from cost of sales and has included the expense as a selling expense in the accompanying condensed consolidated statements of operations. As of December 31, 2013, the Company reclassified the presentation of commissions and fees of $26,054 for the three months ended September 30, 2013 and $219,200 and $144,749 for the three and nine months ended March 31, 2013, respectively, from general and administrative expense and has included the expense as a selling expense in the accompanying condensed consolidated statements of operations. | |||||
Use of Estimates | ' | ||||
Use of Estimates | |||||
In preparing the financial statements in conformity with GAAP, management makes estimates and assumptions that affect the reported amount of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Actual results could differ from these estimates. Management bases its estimates on certain assumptions that it believes to be reasonable as of the reporting period, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. The most subjective and intricate estimates include inventory obsolescence reserves, certain accruals, returns and allowances and fair value calculations, including derivative liabilities and stock option expense. | |||||
Revenue Recognition | ' | ||||
Revenue Recognition | |||||
The Company recognizes revenue generally when all of the following criteria are met (a) persuasive evidence of an arrangement exists through customer issued purchase orders or company verified sales orders, (b) title has transferred upon delivery of products, (c) our sales price is fixed or determinable as included on our sales orders or customer purchase orders, net of estimated returns and discounts, and (d) collection is probable based on customers history or third party credit checks. | |||||
For the nine months ended March 31, 2014, the Company achieved 40% of net revenues from international customers and 60% of net revenues from its domestic customers. For the nine months ended March 31, 2013, the Company achieved 3% of net revenues from international customers and 97% of net revenues from its domestic customers. | |||||
For the three months ended March 31, 2014, the Company achieved 4% of net revenues from international customers and 96% of net revenues from its domestic customers. For the three months ended March 31, 2013, the Company achieved 3% of net revenues from international customers and 97% of net revenues from its domestic customers. | |||||
The Company offers its customers a variety of sales and incentive programs, including discounts, allowances, coupons, slotting fees, and co-op advertising; such amounts are recorded as a reduction of revenue over the period in which revenue is recognized. | |||||
The Company reduced revenue in the amount of $1,221,625 and $812,526 for the nine months ended March 31, 2014 and March 31, 2013, respectively, and such amounts are included in discounts in the accompanying condensed consolidated statement of operations. | |||||
The Company reduced revenue in the amount of $439,105 and $584,983 for the three months ended March 31, 2014 and March 31, 2013, respectively, and such amounts are included in discounts in the accompanying condensed consolidated statement of operations. | |||||
Fair Value Measurements | ' | ||||
Fair Value Measurements | |||||
The Company’s financial instruments are primarily composed of cash, accounts receivable, factoring line of credit, accounts payable, and its convertible notes and warrants. The fair value of cash, restricted cash, accounts receivable, factoring line of credit, accounts payable and convertible notes closely approximates their carrying value due to their short maturities. | |||||
The valuation techniques utilized for the warrants and beneficial conversion feature of its convertible notes are based upon observable and unobservable inputs. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect internal market assumptions. These two types of inputs create the following fair value hierarchy: | |||||
Level 1 – Quoted prices in active markets for identical assets or liabilities. | |||||
Level 2 – Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related asset or liabilities. | |||||
Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of assets or liabilities. | |||||
The Company utilizes observable market inputs (quoted market prices) when measuring fair value whenever possible. | |||||
The Company’s warrants and the beneficial conversion feature for its convertible notes are categorized within Level 3 of the fair value hierarchy. The development and determination of the unobservable inputs for Level 3 fair value measurements and fair value calculations are the responsibility of the Company's accounting and finance department. | |||||
As of March 31, 2014, there were no transfers in or out of Level 3 from other levels. | |||||
Cash and Cash Equivalents | ' | ||||
Cash and Cash Equivalents | |||||
The Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. | |||||
Accounts Receivable | ' | ||||
Accounts Receivable | |||||
Accounts receivable balances represent payments due to the Company for previously recognized net sales, reduced by an allowance for doubtful accounts for balances, which are estimated to be uncollectible at March 31, 2014 and June 30, 2013, respectively. The Company grants credit terms in the normal course of business to its customers. The Company does not require collateral or other security to support credit sales. The allowance for doubtful accounts is determined based on historical experience and ongoing evaluations of the Company’s receivables and evaluations of the risks of payment. The allowance for doubtful accounts is recorded against accounts receivable balances when they are deemed uncollectible. When accounts are deemed significantly past due and uncollectible, the accounts receivable balances are written down for the amount deemed to be uncollectible. Recoveries of accounts receivable previously reserved are recorded in the consolidated statements of operations when received. As of March 31, 2014, all of the Company’s accounts receivable were deemed to be collectible. One customer accounted for 89% and 94% of outstanding accounts receivable, prior to discounts and accruals, as of March 31, 2014 and June 30, 2013, respectively. | |||||
Inventories | ' | ||||
Inventories | |||||
Inventories, which consist primarily of finished goods, include items which are considered salable or usable in future periods, and are stated at the lower of cost or market value, with cost being based on standard cost which approximates actual cost on a first-in, first-out basis. Costs include direct materials, direct labor and overhead (e.g., indirect labor, rent and utilities, depreciation, purchasing, receiving, inspection and quality control), and in-bound freight costs. The Company periodically reviews the value of items in inventory and provides write-downs or write-offs of inventory based on its assessment of market conditions. Write-downs and write-offs are charged to cost of goods sold. As of March 31, 2014 and June 30, 2013, the Company reserved $495,000 and $365,722, respectively, for write-offs. The inventory write-off reserve as of March 31, 2014 was for allowances related to liquidation of slower moving items, potential write-offs of work-in-process inventory and write-offs for obsolete inventory. Total inventories as of March 31, 2014 and June 30, 2013 were $1.713 million and $1.949 million, respectively. | |||||
Property and Equipment | ' | ||||
Property and Equipment | |||||
Property and equipment as of March 31, 2014 consists of costs incurred by the Company in connection with installing display fixtures at certain key customer display rooms and retail stores. The display fixtures are being depreciated on a straight-line basis over two years, which approximates the estimated useful lives of such assets. Display fixtures maintained at customer display rooms and retail stores amounted to $496,463, net of accumulated depreciation, at March 31, 2014. | |||||
Depreciation expense amounted to $361,812 and $89,262 for the nine months ended March 31, 2014 and March 31, 2013, respectively, and is included in depreciation & amortization expense in the accompanying condensed consolidated statements of operations. | |||||
Depreciation expense amounted to $126,843 and $77,609 for the three months ended March 31, 2014 and March 31, 2013, respectively, and is included in depreciation & amortization expense in the accompanying condensed consolidated statements of operations. | |||||
Advertising | ' | ||||
Advertising | |||||
Advertising costs are expensed as incurred. Total advertising expenses amounted to $89,236 and $505,935 for the nine months ended March 31, 2014 and March 31, 2013, respectively, and are included in general and administrative expenses in the accompanying condensed consolidated statements of operations. Total advertising expenses amounted to $1,212 and $215,173 for the three months ended March 31, 2014 and March 31, 2013, respectively, and are included in general and administrative expenses in the accompanying condensed consolidated statements of operations. | |||||
Selling Expenses and Commissions | ' | ||||
Selling Expenses and Commissions | |||||
Selling expenses are expensed as incurred. Total selling expenses amounted to $369,359 and $585,241 for the nine months ended March 31, 2014 and 2013, respectively, and are included in operating expenses in the accompanying statements of operations. Total selling expenses amounted to $18,843 and $243,463 for the three months ended March 31, 2014 and 2013. | |||||
As of September 30, 2013, the Company reclassified the presentation of freight-out from cost of sales and has included the expense as a selling expense under operating expenses in the accompanying condensed consolidated statements of operations. Accordingly, the prior periods have been updated to reflect such reclassification. Shipping expense is included in selling expense under operating expenses and amounted to $89,256 and $335,232 during the nine months ended March 31, 2014 and March 31, 2013, respectively. Total shipping expense was $14,678 and $72,705 for the three months ended March 31, 2014 and 2013, respectively. | |||||
Selling commissions are expensed as incurred. As of December 31, 2013, the Company reclassified the presentation of commissions and fees from general and administrative expenses and has included the expense as a selling expense under operating expenses in the accompanying condensed consolidated statements of operations. Accordingly, the prior periods have been updated to reflect such reclassification. Total selling commissions amounted to $63,338 and $219,200 for the nine months ended March 31, 2014 and 2013, respectively, and are included in selling expenses in the accompanying condensed consolidated statements of operations. Total selling commissions amounted to $(10,718) and $144,749 for the three months ended March 31, 2014 and 2013, respectively. | |||||
Deferred Financing Costs | ' | ||||
Deferred Financing Costs | |||||
Deferred financing costs represent fees paid in connection with obtaining short-term loans and convertible notes (see Notes 4, 5 and 6). These fees are amortized using a method that approximates the effective interest method over the term of the related financing. | |||||
As of March 31, 2014 and June 30, 2013, deferred financing costs of $157,560 and $358,792, respectively, net of accumulated amortization, are presented on the accompanying condensed consolidated balance sheets. | |||||
Amortization expense for deferred financing costs was $198,836 and $656,623 for the nine months ended March 31, 2014 and March 31, 2013, respectively, is included in interest expense in the accompanying condensed consolidated statements of operations. The remaining deferred financing costs will be fully amortized by August 1, 2015. | |||||
Debt Discount | ' | ||||
Debt Discount | |||||
The Company records debt discounts in connection with raising funds through the issuance of convertible debt (see Note 5). These costs are amortized to interest expense over the life of the debt. If a conversion of the underlying debt occurs, a proportionate share of the unamortized amounts is charged to the statement of operations. | |||||
As of March 31, 2014 and June 30, 2013, convertible debt, net of unamortized debt discounts, was $1,085,779 and $281,716, respectively. | |||||
Amortization expense for debt discounts was $753,437 and $551,502 for the nine months ended March 31, 2014 and March 31, 2013, and is included in interest expense in the accompanying condensed consolidated statements of operations. Amortization expense for debt discounts was $261,614 and $498,798 for the three months ended March 31, 2014 and March 31, 2013 and is included in interest expense in the accompanying condensed consolidated statements of operations. The remaining debt discounts will be fully amortized by August 1, 2015 (see Note 5). | |||||
Derivative Financial Instruments | ' | ||||
Derivative Financial Instruments | |||||
GAAP requires derivative instruments embedded in convertible debt or equity instruments, to be bifurcated and measured at their fair value for accounting purposes. In determining the appropriate fair value, the Company uses the Black-Scholes option-pricing model, which management estimates to approximate the fair value using the Binomial Lattice Model. In assessing the debt instruments with characteristics of liability and equity, management determines if the convertible debt host instrument is conventional convertible debt and if there is a beneficial conversion feature. If the instrument is not considered conventional convertible debt, the Company will estimate the fair value of the embedded derivative instruments. The warrant liability is measured at fair value on a recurring basis using level 3 inputs (see Notes 5 and 6). | |||||
Financial Instruments and Concentrations of Business and Credit Risk | ' | ||||
Financial Instruments and Concentrations of Business and Credit Risk | |||||
The Company’s financial instruments include cash and cash equivalents, convertible debt, a factoring line of credit, short-term loans, accounts payable and other current assets and liabilities. The fair value of these instruments approximates their carrying value due to their relatively short maturities. Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents. Customer concentrations also subject the Company to concentrations of credit risk. The Company maintains cash balances that at times exceed amounts insured by the Federal Deposit Insurance Corporation. | |||||
Three customers accounted for approximately 22%, 29% and 28% of the Company’s net revenues for the nine months ended March 31, 2014. Three customers accounted for approximately 45%, 19% and 7% of the Company’s net revenues for the nine months ended March 31, 2013. | |||||
Three customers accounted for approximately 77%, 17% and 10% of the Company’s net revenues for the three months ended March 31, 2014. Three customers accounted for approximately 58%, 11% and 9% of the Company’s net revenues for the three months ended March 31, 2013. | |||||
Accounts receivable for one customer represented 89% of the Company’s accounts receivable balance as of March 31, 2014. Accounts receivable for one customer represented 94% of the Company’s accounts receivable balance as of June 30, 2013. | |||||
Three suppliers represented 31%, 16%, and 12% of the Company’s inventory purchases as of March 31, 2014. | |||||
The Company has not experienced any losses in these accounts and believes it is not exposed to any significant credit risk in this area. | |||||
License Acquisition Costs | ' | ||||
License Acquisition Costs | |||||
License acquisition costs represent legal fees paid in connection with obtaining the Company’s license agreements (see Note 3). These fees are amortized using the straight-line method over the term of each license agreement. | |||||
As of March 31, 2014 and June 30, 2013, license acquisition costs, net of amortization, were $18,376 and $24,504, respectively on the accompanying condensed consolidated balance sheets. | |||||
Amortization of license acquisition costs of $6,128 and $1,998 is included in depreciation and amortization expense in the accompanying condensed consolidated statements of operations for the nine months ended March 31, 2014 and March 31, 2013. Amortization of license acquisition costs was $1,922 and $656 for the three months ended March 31, 2014 and March 31, 2013. | |||||
Estimated future license acquisition cost amortization expense is as follows: | |||||
Twelve month periods ending March 31, | |||||
2015 | $ | 7,793 | |||
2016 | 7,533 | ||||
2017 | 3,050 | ||||
$ | 18,376 | ||||
Impairment of Long-Lived Assets | ' | ||||
Impairment of Long-Lived Assets | |||||
The Company evaluates long-lived assets and certain identifiable intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to undiscounted future cash flows expected to be generated by the asset. In such cases, the carrying value of these assets are adjusted to their estimated fair value and assets held for sale are adjusted to their estimated fair value less selling expenses. No impairment losses of long-lived assets or intangible assets were recognized for the nine and three months ended March 31, 2014 and March 31, 2013. | |||||
Income Taxes | ' | ||||
Income Taxes | |||||
The Company uses the asset and liability method of accounting for income taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized as income in the period that includes the enactment date. The Company provides a valuation allowance against its deferred tax assets when circumstances indicate that it is no longer more likely than not that such assets will be realized. | |||||
Net Loss Per Share | ' | ||||
Net Loss Per Share | |||||
Basic net income / (loss) per share is computed by dividing net income / (loss) by the weighted average number of shares of common stock outstanding for the period. The Company’s potential dilutive shares, which include common stock options, common stock warrants and convertible debt have not been included in the computation of diluted net loss per share for all periods where there was a net loss as the result would be antidilutive. Such potentially dilutive shares are excluded when the effect would be to reduce net loss per share. Such potential shares of common stock consist of the following: | |||||
As of | |||||
March 31, | |||||
2014 | |||||
Warrants | 747,354 | ||||
Stock options | 177,800 | ||||
Convertible Debt | 396,288 | ||||
Preferred Stock | 80,000 | ||||
1,401,442 | |||||
Summary_of_Significant_Account2
Summary of Significant Accounting Policies (Tables) | 9 Months Ended | ||||
Mar. 31, 2014 | |||||
Summary of Significant Accounting Policies [Abstract] | ' | ||||
Summary of estimated future license acquisition cost amortization expense | ' | ||||
Twelve month periods ending March 31, | |||||
2015 | $ | 7,793 | |||
2016 | 7,533 | ||||
2017 | 3,050 | ||||
$ | 18,376 | ||||
Summary of consists of potential common shares | ' | ||||
As of | |||||
March 31, | |||||
2014 | |||||
Warrants | 747,354 | ||||
Stock options | 177,800 | ||||
Convertible Debt | 396,288 | ||||
Preferred Stock | 80,000 | ||||
1,401,442 | |||||
Licensing_Agreement_and_Prepai1
Licensing Agreement and Prepaid Royalties (Tables) | 9 Months Ended | ||||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||||
Licensing Agreement and Prepaid Royalties [Abstract] | ' | ||||||||||||||||||||
Schedule of contractual commitment | ' | ||||||||||||||||||||
Total | Less than | 1 – 3 years | 3 - 5 years | More than | |||||||||||||||||
1 year | 5 years | ||||||||||||||||||||
License agreement obligations | $ | 4,879,560 | $ | 1,301,250 | $ | 3,578,310 | $ | 0 | $ | 0 | |||||||||||
Operating lease obligation | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | |||||||||||
Total | $ | 4,879,560 | $ | 1,301,250 | $ | 3,578,310 | $ | 0 | $ | 0 | |||||||||||
Factoring_Agreements_and_Short1
Factoring Agreements and Short - Term Loans (Tables) | 9 Months Ended | ||||
Mar. 31, 2014 | |||||
Factoring Agreements and Short Term Loans [Abstract] | ' | ||||
Summary of Existing Factoring and Supply Agreement | ' | ||||
Due from Factor | $ | 204,231 | |||
Positive Loan Balance (due from factor): | 48,969 | ||||
Unapplied Customer Credits | 0 | ||||
Due from Factor, Net | $ | 253,200 |
Convertible_Debt_Offering_Tabl
Convertible Debt Offering (Tables) (Convertible Note [Member]) | 9 Months Ended | ||||
Mar. 31, 2014 | |||||
Convertible Note [Member] | ' | ||||
Schedule of convertible debt discount | ' | ||||
August Convertible Note Face Value | $ | 616,000 | |||
Debt Discount | |||||
August Convertible Notes – Issued Warrant Derivative | 87,264 | ||||
Conversion Feature Derivative | 25,827 | ||||
Original Issue Discount | 66,000 | ||||
Total Debt Discount | $ | 179,091 | |||
Amortization of Debt Discount, as of March 31, 2014 | (179,091 | ) | |||
Debt Discount, Net | $ | 0 | |||
August Convertible Note Carrying Value at March 31, 2014, gross | $ | 616,000 | |||
Conversion of August Convertible Note into Preferred | (616,000 | ) | |||
August Convertible Note Carrying Value at March 31, 2014, net | $ | 0 | |||
June Convertible Notes Face Value | $ | 1,680,000 | |||
Debt Discount | |||||
June Convertible Notes – Issued Warrant Derivative | 752,126 | ||||
Conversion Feature Derivative | 491,051 | ||||
Original Issue Discount | 180,000 | ||||
Total Debt Discount | $ | 1,423,177 | |||
Amortization of Debt Discount, as of March 31, 2014 | (709,107 | ) | |||
Debt Discount, gross | $ | 714,070 | |||
Amortized under Loss from Extinguishment as of March 31, 2014 | 568,341 | ||||
Debt Discount, net | $ | 145,729 | |||
June Convertible Notes Carrying Value at March 31, 2014, gross (net of debt discounts of $714,070) | $ | 965,930 | |||
Conversion of June Convertible Notes into Preferred | 768,802 | ||||
June Convertible Notes Carrying Value at March 31, 2014, net (net of debt discounts of $145,729) | $ | 197,128 | |||
Schedule of deferred financing cost | ' | ||||
Legal fees and other fees associated with the Bridge Note offering | $ | 120,405 | |||
Total Deferred Financing Costs | $ | 120,405 | |||
Amortization of Deferred Financing Costs, as of March 31, 2014 | (239 | ) | |||
Deferred Financing Costs, Net, as of March 31, 2014 | $ | 120,166 | |||
Legal fees and other fees associated with the August Convertible Notes offering | $ | 62,065 | |||
Total Deferred Financing Costs | $ | 62,065 | |||
Amortization of Deferred Financing Costs, as of March 31, 2014 | (62,065 | ) | |||
Deferred Financing Costs, Net, as of March 31, 2014 | $ | 0 | |||
Placement agent and other fees associated with the June Convertible Notes offering | $ | 304,293 | |||
June Convertible Note Broker Warrants | 60,886 | ||||
Total Deferred Financing Costs | $ | 365,179 | |||
Amortization of Deferred Financing Costs, as of March 31, 2014 | (327,785 | ) | |||
Deferred Financing Costs, Net, as of March 31, 2014 | $ | 37,394 | |||
Derivative_Liability_Tables
Derivative Liability (Tables) | 9 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Derivative Liability [Abstract] | ' | ||||||||
Summary of roll forward of fair value of warrant liability | ' | ||||||||
March 31, | June 30, | ||||||||
2014 | 2013 | ||||||||
Beginning Balance | $ | 1,660,440 | $ | 0 | |||||
Issuance of Warrants | 224,899 | 7,252,283 | |||||||
Repurchase / Exercise / Cancellation of Warrants | (57,129 | ) | (179,884 | ) | |||||
Change in fair value | (1,708,651 | ) | (5,411,959 | ) | |||||
Ending Balance | $ | 119,559 | $ | 1,660,440 |
Stock_Compensation_Expense_and1
Stock Compensation Expense and Fair Value Measurement (Tables) | 9 Months Ended | ||||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||||
Stock Compensation Expense and Fair Value Measurement [Abstract] | ' | ||||||||||||||||||||
Summary of relevant inputs used to determine the value of the stock option grants | ' | ||||||||||||||||||||
Number of | Weighted | Expected | Expected | Expected | |||||||||||||||||
options | average | life in years | volatility | dividends | |||||||||||||||||
outstanding | risk-free rate | ||||||||||||||||||||
12-Jul-12 | 36,000 | 0.83 | % | 3.5 | 70 | % | 0 | % | |||||||||||||
15-Aug-12 | 3,975 | 0.83 | % | 6 | 70 | % | 0 | % | |||||||||||||
21-Nov-12 | 5,000 | 0.95 | % | 6 | 60 | % | 0 | % | |||||||||||||
28-Mar-13 | 0 | 1.005 | % | 6 | 55 | % | 0 | % | |||||||||||||
8-Apr-13 | 5,000 | 1.685 | % | 6 | 55 | % | 0 | % | |||||||||||||
28-Jun-13 | 250 | 1.685 | % | 6 | 55 | % | 0 | % | |||||||||||||
12-Jul-13 | 114,000 | 1.715 | % | 3.5 | 65 | % | 0 | % | |||||||||||||
15-Aug-13 | 13,575 | 1.86 | % | 6 | 65 | % | 0 | % | |||||||||||||
Total | 177,800 |
Income_Taxes_Tables
Income Taxes (Tables) | 9 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Income Taxes [Abstract] | ' | ||||||||
Schedule of Effective Income Tax Rate Reconciliation | ' | ||||||||
March 31, | |||||||||
2014 | |||||||||
Statutory rate | 34 | % | |||||||
State income taxes | 5.8 | % | |||||||
Permanent differences | 2.3 | % | |||||||
Valuation allowance | (42.5 | )% | |||||||
Other | 0.4 | % | |||||||
Total | 0 | % | |||||||
Schedule of Deferred Tax Assets and (liabilities) | ' | ||||||||
March 31, | June 30, | ||||||||
2014 | 2013 | ||||||||
Net operating losses carryforward | $ | 4,197,125 | $ | 2,002,842 | |||||
Start-up costs and fixed assets, net of amortization | 120,011 | 60,005 | |||||||
Property and equipment | 159,025 | 56,270 | |||||||
Stock based compensation | 399,261 | 192,786 | |||||||
Gross deferred taxes | $ | 4,875,422 | $ | 2,311,903 | |||||
Valuation allowance | (4,875,422 | ) | (2,311,903 | ) | |||||
Net deferred taxes | $ | - | $ | - | |||||
Formation_and_Nature_of_Busine1
Formation and Nature of Business (Details) (USD $) | 0 Months Ended | ||
6-May-14 | Mar. 31, 2014 | Jun. 30, 2013 | |
Formation and Nature of Business (Textual) | ' | ' | ' |
Common stock, par value | $0.00 | $0.00 | $0.00 |
Reverse stock split ratio | 'l00-for-1 | ' | ' |
Summary_of_Significant_Account3
Summary of Significant Accounting Policies (Details) (Licensing Agreements, USD $) | Mar. 31, 2014 |
Licensing Agreements | ' |
Estimated future license acquisition cost amortization expense | ' |
2015 | $7,793 |
2016 | 7,533 |
2017 | 3,050 |
Estimated future license acquisition cost amortization expense | $18,376 |
Summary_of_Significant_Account4
Summary of Significant Accounting Policies (Details 1) | 9 Months Ended |
Mar. 31, 2014 | |
Summary of consists of potential common shares | ' |
Total Shares | 1,401,442 |
Warrant [Member] | ' |
Summary of consists of potential common shares | ' |
Total Shares | 747,354 |
Stock options [Member] | ' |
Summary of consists of potential common shares | ' |
Total Shares | 177,800 |
Convertible Debt [Member] | ' |
Summary of consists of potential common shares | ' |
Total Shares | 396,288 |
Preferred Stock [Member] | ' |
Summary of consists of potential common shares | ' |
Total Shares | 80,000 |
Summary_of_Significant_Account5
Summary of Significant Accounting Policies (Details Textual) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Mar. 31, 2014 | Sep. 30, 2013 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Jun. 30, 2013 | |
Customer | ||||||
Summary of Significant Accounting Policies (Textual) | ' | ' | ' | ' | ' | ' |
Sales discount expenses | $439,105 | ' | $584,983 | $1,221,625 | $812,526 | ' |
Estimated useful lives of assets | ' | ' | ' | 'Two years | ' | ' |
Property and equipment, net | 496,463 | ' | ' | 496,463 | ' | 669,033 |
Depreciation expense | 126,843 | ' | 77,609 | 361,811 | 89,262 | ' |
Advertising expenses | 1,212 | ' | 215,173 | 89,236 | 505,935 | ' |
Selling expenses | 18,843 | ' | 243,463 | 369,359 | 585,241 | ' |
Selling commission expenses | -10,718 | 26,054 | 144,749 | 63,338 | 219,200 | ' |
Deferred financing costs, net | 120,166 | ' | ' | 120,166 | ' | 328,893 |
Amortization of deferred financing costs | ' | ' | ' | 198,836 | 656,623 | ' |
Deferred financing costs amortization date | ' | ' | ' | 1-Aug-15 | ' | ' |
Bridge and Convertible Note outstanding | 1,085,779 | ' | ' | 1,085,779 | ' | 281,716 |
Inventory write-offs | ' | ' | ' | 495,000 | ' | 365,722 |
Amortization of debt discount | 261,614 | ' | 498,798 | 753,437 | 551,502 | ' |
Number of customer | ' | ' | ' | 3 | ' | ' |
License acquisition costs | 18,376 | ' | ' | 18,376 | ' | 24,504 |
Amortization of license acquisition costs | 1,922 | ' | 656 | 6,128 | 1,998 | ' |
Impairment losses of long-lived assets or intangible assets recognized | ' | ' | ' | ' | ' | ' |
Inventory, net | 1,712,846 | ' | ' | 1,712,846 | ' | 1,948,908 |
Shipping and freight out expenses | $14,678 | ' | $72,705 | $89,256 | $335,232 | ' |
Customer Concentration Risk [Member] | Suppliers One [Member] | ' | ' | ' | ' | ' | ' |
Summary of Significant Accounting Policies (Textual) | ' | ' | ' | ' | ' | ' |
Customer concentration risk | ' | ' | ' | 31.00% | ' | ' |
Customer Concentration Risk [Member] | Suppliers Two [Member] | ' | ' | ' | ' | ' | ' |
Summary of Significant Accounting Policies (Textual) | ' | ' | ' | ' | ' | ' |
Customer concentration risk | ' | ' | ' | 16.00% | ' | ' |
Customer Concentration Risk [Member] | Suppliers Three [Member] | ' | ' | ' | ' | ' | ' |
Summary of Significant Accounting Policies (Textual) | ' | ' | ' | ' | ' | ' |
Customer concentration risk | ' | ' | ' | 12.00% | ' | ' |
Customer Concentration Risk [Member] | Net revenues [Member] | Major Customer One [Member] | ' | ' | ' | ' | ' | ' |
Summary of Significant Accounting Policies (Textual) | ' | ' | ' | ' | ' | ' |
Customer concentration risk | 77.00% | ' | 58.00% | 22.00% | 45.00% | ' |
Customer Concentration Risk [Member] | Net revenues [Member] | Major Customer Two [Member] | ' | ' | ' | ' | ' | ' |
Summary of Significant Accounting Policies (Textual) | ' | ' | ' | ' | ' | ' |
Customer concentration risk | 17.00% | ' | 11.00% | 29.00% | 19.00% | ' |
Customer Concentration Risk [Member] | Net revenues [Member] | Major Customer Three [Member] | ' | ' | ' | ' | ' | ' |
Summary of Significant Accounting Policies (Textual) | ' | ' | ' | ' | ' | ' |
Customer concentration risk | 10.00% | ' | 9.00% | 28.00% | 7.00% | ' |
Customer Concentration Risk [Member] | Net revenues [Member] | International Customers [Member] | ' | ' | ' | ' | ' | ' |
Summary of Significant Accounting Policies (Textual) | ' | ' | ' | ' | ' | ' |
Customer concentration risk | 4.00% | ' | 3.00% | 40.00% | 3.00% | ' |
Customer Concentration Risk [Member] | Net revenues [Member] | Domestic Customers [Member] | ' | ' | ' | ' | ' | ' |
Summary of Significant Accounting Policies (Textual) | ' | ' | ' | ' | ' | ' |
Customer concentration risk | 96.00% | ' | 97.00% | 60.00% | 97.00% | ' |
Customer Concentration Risk [Member] | Accounts receivable [Member] | Major Customer One [Member] | ' | ' | ' | ' | ' | ' |
Summary of Significant Accounting Policies (Textual) | ' | ' | ' | ' | ' | ' |
Customer concentration risk | ' | ' | ' | 89.00% | ' | 94.00% |
Licensing_Agreement_and_Prepai2
Licensing Agreement and Prepaid Royalties (Details) (USD $) | Mar. 31, 2014 |
Schedule of contractual commitment [Abstract] | ' |
Less than 1 year | $1,301,250 |
1-3 years | 3,578,310 |
3-5 years | 0 |
More than 5 years | 0 |
Total | 4,879,560 |
License agreement obligations [Member] | ' |
Schedule of contractual commitment [Abstract] | ' |
Less than 1 year | 1,301,250 |
1-3 years | 3,578,310 |
3-5 years | 0 |
More than 5 years | 0 |
Total | 4,879,560 |
Operating lease obligation [Member] | ' |
Schedule of contractual commitment [Abstract] | ' |
Less than 1 year | 0 |
1-3 years | 0 |
3-5 years | 0 |
More than 5 years | 0 |
Total | $0 |
Licensing_Agreement_and_Prepai3
Licensing Agreement and Prepaid Royalties (Details Textual) (USD $) | 3 Months Ended | 9 Months Ended | 9 Months Ended | 9 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | ||||||||||||||||
Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Jun. 30, 2013 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Jun. 30, 2012 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | |
Royalty Agreements Two [Member] | Royalty Agreements Two Period Two [Member] | Royalty Agreements Two Period Three [Member] | Royalty Agreements Three [Member] | Royalty Agreements Three Period Two [Member] | Royalty Agreements Three Period Three [Member] | Royalty Agreement One [Member] | Royalty Agreement One [Member] | Royalty Agreement One [Member] | Royalty Agreement One [Member] | Royalty Agreements One Contract Period Two [Member] | Royalty Agreements One Contract Period Two [Member] | Royalty Agreements One Contract Period Three [Member] | Royalty Agreements One Contract Period Three [Member] | Royalty Agreements One Contract Period Four [Member] | Royalty Agreements One Contract Period Four [Member] | License Agreement [Member] | License Agreement [Member] | ||||||
Minimum [Member] | Maximum [Member] | Minimum [Member] | Maximum [Member] | Minimum [Member] | Maximum [Member] | Minimum [Member] | Maximum [Member] | ||||||||||||||||
Prepaid Royalties [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Licensing agreement expiration date | ' | ' | ' | ' | ' | 29-Feb-16 | ' | ' | 16-Apr-16 | ' | ' | 30-Nov-16 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Guaranteed royalty payment under agreements | ' | ' | ' | ' | ' | $600,000 | $225,000 | $275,000 | ' | $33,333 | $33,334 | ' | ' | $4,686,125 | $4,985,000 | $925,000 | $1,000,000 | $1,188,625 | $1,285,000 | $1,572,500 | $1,700,000 | ' | ' |
Prepaid royalty | 5,590 | ' | 5,590 | ' | 378,960 | 100,000 | ' | ' | 10,000 | ' | ' | ' | 1,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net of amortization prepaid royalty | ' | ' | ' | ' | ' | 100,000 | ' | ' | 5,590 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Warrants granted to purchase common stock | ' | ' | 100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Royalty expense | 419,036 | 157,895 | 815,370 | 480,704 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 413,915 | 25,429 |
Accrued royalties fees | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $439,344 | $439,344 |
Factoring_Agreements_and_Short2
Factoring Agreements and Short - Term Loans (Details) (USD $) | Mar. 31, 2014 | Jun. 30, 2013 |
Factoring Agreements and Short Term Loans [Abstract] | ' | ' |
Due from Factor | $204,231 | ' |
Positive Loan Balance (due from factor): | 48,969 | ' |
Unapplied Customer Credits | 0 | ' |
Due from factor, net | $253,200 | $164,090 |
Factoring_Agreements_and_Short3
Factoring Agreements and Short - Term Loans (Details Textual) (USD $) | 0 Months Ended | 3 Months Ended | 9 Months Ended | 0 Months Ended | 0 Months Ended | |||||||
Mar. 28, 2013 | Nov. 21, 2012 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Sep. 07, 2012 | Mar. 31, 2013 | Dec. 07, 2012 | Nov. 09, 2012 | Sep. 25, 2012 | Oct. 04, 2012 | |
Secured Bridge Loan Promissory Notes [Member] | Secured Bridge Loan Promissory Notes [Member] | Short Term Note [Member] | Short Term Note [Member] | Short Term Note [Member] | Solops LLC [Member] | |||||||
Short Term Loans and Factoring Agreement (Textual) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Promissory notes issued | ' | ' | ' | ' | ' | $1,335,000 | $150,000 | ' | $100,000 | $60,000 | $150,000 | ' |
Secured bridge loan promissory notes, interest rate | ' | ' | ' | ' | ' | ' | 10.00% | 10.00% | 10.00% | 10.00% | ' | ' |
Promissory notes, maturity date | ' | ' | ' | ' | ' | ' | 7-Dec-12 | ' | ' | ' | 25-Dec-12 | ' |
Factoring line of credit, principal amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,125,000 |
Factoring line of credit, purchase price of receivable | ' | ' | 204,231 | ' | 204,231 | ' | ' | ' | ' | ' | ' | 875,000 |
Factoring line of credit, amount collected by factor | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,065,000 |
Share Price | $25 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Factoring Agreements and Supply Agreements, Term of agreement | ' | '1 year | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of borrowing under factoring line of credit | ' | 80.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Additional warrants issued | 1,500 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Warrant exercisable term | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accrued interest and commissions | ' | ' | $18,255 | $95,490 | $78,162 | $132,255 | ' | ' | ' | ' | ' | ' |
Convertible_Debt_Offering_Deta
Convertible Debt Offering (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | |
Schedule of convertible debt discount | ' | ' | ' | ' |
Convertible Note Face Value | ' | ' | $258,240 | ' |
Debt Discount | ' | ' | ' | ' |
Amortization of Debt Discount | 261,614 | 498,798 | 753,437 | 551,502 |
Convertible Notes Carrying Value | ' | ' | ' | ' |
Bridge Note [Member] | ' | ' | ' | ' |
Schedule of convertible debt discount | ' | ' | ' | ' |
Bridge Note Face Value | 1,120,000 | ' | 1,120,000 | ' |
Debt Discount | ' | ' | ' | ' |
Brige Notes - Issued Warrant Derivative | ' | ' | 93,980 | ' |
Conversion Feature Derivative | ' | ' | 17,828 | ' |
Original Issue Discount | ' | ' | 120,000 | ' |
Total Debt Discount | ' | ' | 231,808 | ' |
Amortization of Debt Discount | ' | ' | -459 | ' |
Debt Discount, net | ' | ' | 231,349 | ' |
Convertible Notes Carrying Value | 888,651 | ' | 888,651 | ' |
August Convertible Note [Member] | ' | ' | ' | ' |
Schedule of convertible debt discount | ' | ' | ' | ' |
Convertible Note Face Value | ' | ' | 616,000 | ' |
Debt Discount | ' | ' | ' | ' |
Convertible Notes - Issued Warrant Derivative | ' | ' | 87,264 | ' |
Conversion Feature Derivative | ' | ' | 25,827 | ' |
Original Issue Discount | ' | ' | 66,000 | ' |
Total Debt Discount | ' | ' | 179,091 | ' |
Amortization of Debt Discount | ' | ' | -179,091 | ' |
Debt Discount, net | ' | ' | 0 | ' |
Convertible Notes Carrying Value | 616,000 | ' | 616,000 | ' |
Conversion of Convertible Note into Preferred | ' | ' | -616,000 | ' |
Convertible Note Carrying Value Net | ' | ' | 0 | ' |
June Convertible Note Offering [Member] | ' | ' | ' | ' |
Schedule of convertible debt discount | ' | ' | ' | ' |
Convertible Note Face Value | ' | ' | 1,680,000 | ' |
Debt Discount | ' | ' | ' | ' |
Convertible Notes - Issued Warrant Derivative | ' | ' | 752,126 | ' |
Conversion Feature Derivative | ' | ' | 491,051 | ' |
Original Issue Discount | ' | ' | 180,000 | ' |
Total Debt Discount | ' | ' | 1,423,177 | ' |
Amortization of Debt Discount | ' | ' | -709,107 | ' |
Debt Discount, gross | ' | ' | 714,070 | ' |
Amortized under Loss from Extinguishment as of March 31, 2014 | ' | ' | 568,341 | ' |
Debt Discount, net | ' | ' | 145,729 | ' |
Convertible Notes Carrying Value | 965,930 | ' | 965,930 | ' |
Conversion of Convertible Note into Preferred | ' | ' | 768,802 | ' |
Convertible Note Carrying Value Net | ' | ' | $197,128 | ' |
Convertible_Debt_Offering_Deta1
Convertible Debt Offering (Details 1) (USD $) | Mar. 31, 2014 | Jun. 30, 2013 |
Schedule of deferred financing cost | ' | ' |
Total Deferred Financing Costs | $133,059 | $328,893 |
Deferred Financing Costs, Net | 37,394 | 29,899 |
Convertible Note [Member] | ' | ' |
Schedule of deferred financing cost | ' | ' |
Legal fees and other fees associated | 62,065 | ' |
Total Deferred Financing Costs | 62,065 | ' |
Amortization of Deferred Financing Costs | -62,065 | ' |
Deferred Financing Costs, Net | 0 | ' |
June Convertible Note Offering [Member] | ' | ' |
Schedule of deferred financing cost | ' | ' |
Legal fees and other fees associated | 304,293 | ' |
June Convertible Note Broker Warrants | 60,886 | ' |
Total Deferred Financing Costs | 365,179 | ' |
Amortization of Deferred Financing Costs | -327,785 | ' |
Deferred Financing Costs, Net | 37,394 | ' |
Bridge Note [Member] | ' | ' |
Schedule of deferred financing cost | ' | ' |
Legal fees and other fees associated | 120,405 | ' |
Total Deferred Financing Costs | 120,405 | ' |
Amortization of Deferred Financing Costs | -239 | ' |
Deferred Financing Costs, Net | $120,166 | ' |
Convertible_Debt_Offering_Deta2
Convertible Debt Offering (Details Textual) (USD $) | 0 Months Ended | 1 Months Ended | 3 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | 9 Months Ended | 9 Months Ended | 1 Months Ended | 9 Months Ended | 1 Months Ended | 9 Months Ended | ||||||||||||||||||||||
Mar. 28, 2013 | Dec. 21, 2012 | Aug. 29, 2013 | Mar. 28, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Jun. 30, 2013 | Mar. 28, 2013 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Jun. 30, 2012 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Jun. 20, 2013 | Jun. 20, 2013 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Jun. 20, 2013 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | |
Convertible Note Warrants [Member] | Convertible Note Warrants [Member] | Aegis Capital Corporation [Member] | Third Party [Member] | Gottbetter Capital Markets (GCM) [Member] | Gottbetter Capital Markets (GCM) [Member] | Gottbetter & Partners and Loeb & Loeb [Member] | Convertible Note Broker Warrants [Member] | Convertible Note [Member] | June Convertible Note Offering [Member] | June Convertible Note Offering [Member] | June Convertible Debt Offering [Member] | June Convertible Debt Offering [Member] | June Convertible Debt Offering [Member] | June Convertible Debt Offering [Member] | June Convertible Debt Offering [Member] | June Convertible Debt Offering [Member] | June Convertible Debt Offering [Member] | June Convertible Debt Offering [Member] | June Convertible Debt Offering [Member] | June Convertible Debt Offering [Member] | April Convertible Note [Member] | Bridge Note [Member] | Bridge Note Offering [Member] | Bridge Note Redemption [Member] | ||||||||||
Aegis Capital Corporation [Member] | Convertible Note Warrants [Member] | Gottbetter Capital Markets (GCM) [Member] | Debt Instrument, Redemption, Period One [Member] | Debt Instrument, Redemption, Period Two [Member] | Debt Instrument, Redemption, Period Three [Member] | Debt Instrument, Redemption, Period Four [Member] | Debt Instrument, Redemption, Period Five [Member] | Debt Instrument, Redemption, Period Six [Member] | Debt Instrument, Redemption, Period Seven [Member] | |||||||||||||||||||||||||
Convertible Debt (Textual) [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Senior secured convertible notes issued | ' | ' | $616,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $1,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Original Issue Discount | ' | ' | 12.00% | ' | 12.00% | ' | 12.00% | ' | ' | ' | ' | 10.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred financing costs | ' | ' | ' | ' | 133,059 | ' | 133,059 | ' | 328,893 | ' | ' | 406,900 | 1,537,940 | ' | ' | ' | ' | 62,065 | 365,179 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 120,405 | ' | ' |
Period for cashless exercise warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | ' | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument, Interest Rate Terms | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'The June Convertible Notes bear interest at 8% per annum, which is paid quarterly beginning on November 1, 2013. Interest is payable in cash or at the Company's option in shares of the Company's common stock, provided certain conditions are met, based on a share value equal to the lesser of (a) 90% of the average of the VWAP for the 20 consecutive trading days prior to the applicable interest payment date and (b) 100% of the average of the VWAP for the 20 consecutive trading days prior to the applicable interest payment date less $1.00. Upon any Event of Default (as defined in the June Convertible Notes), the outstanding principal amount of the June Convertible Notes plus liquidated damages, interest, a premium of 30% and other amounts owing in respect thereof through the date of acceleration, shall become, at the holders' election, immediately due and payable in cash. Commencing five days after the occurrence of any Event of Default, the interest rate on the June Convertible Notes shall accrue at an interest rate equal to the lesser of 18% per annum or the maximum rate permitted under applicable law. The June Conversion Price is subject to "full ratchet" and other customary anti-dilution protections. | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
The August Convertible Notes bear interest at a rate of 8% per annum, which is paid quarterly. Interest is payable in cash or at the Company’s option in shares of common stock, provided certain conditions are met, based on a share value equal to the lesser of (a) 90% of the average of the volume weighted average price (the “VWAP”) for the 20 consecutive trading days prior to the applicable interest payment date and (b) 100% of the average of the VWAP for the 20 consecutive trading days prior to the applicable interest payment date less $1.00. Upon any Event of Default (as defined in the August Convertible Notes), the outstanding principal amount of each August Convertible Note, plus liquidated damages, interest, a premium of 30% and other amounts owing in respect thereof through the date of acceleration, shall become, at the noteholders’ election, immediately due and payable in cash. Commencing five days after the occurrence of any Event of Default, the interest rate on each August Convertible Note shall accrue at an interest rate equal to the lesser of 18% per annum or the maximum rate permitted under applicable law. The August Conversion Price is subject to “full ratchet” and other customary anti-dilution protections. | ||||||||||||||||||||||||||||||||||
Warrants ,exercise price | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25 | ' | ' | 8.2 | 0.082 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of common stock purchase due to issuance of warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 19,000 | 1,900,000 | ' | 25,040 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of funds raised in convertible notes offering paid as commission | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 7.20% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Term of Convertible Notes | ' | 'The term of the Convertible Notes include an eight month maturity period and an annual interest rate of 12% which is accrued until payment or until the Convertible Notes are converted into equity. | 'The term of the August Convertible Notes include an eighteen-month maturity period, with partial redemption beginning on September 1, 2014. The August Convertible Notes bear interest at a rate of 8% per annum, which is paid quarterly. | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'The term of the June Convertible Notes includes an eighteen-month maturity period, with partial redemptions beginning on June 1, 2014. | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'The Convertible Notes were converted at a per share price of $70.00, as the Company's stock price was less than $30.00 on the Reset Date, for 302,762 shares. The Convertible Note Warrants were converted into 700,00 shares of the Company's common stock. | ' | 'The term of the Bridge Note includes a seventeen-month maturity period, with partial redemption beginning on February 1, 2015. The Bridge Note bears interest at a rate of 8% per annum, which is paid quarterly. | ' |
Convertible note redemption description | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'In lieu of a cash redemption and subject to the Company meeting certain equity conditions described in the June Convertible Notes, the Company may elect to pay the June Periodic Redemption Amount in shares of its common stock based on a conversion price equal to the lesser of (a) $6.80 per share, subject to adjustments upon certain events, and (b) 90% of the average of the VWAP for the 20 consecutive trading days prior to the applicable redemption date. | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'The Bridge Note bears interest at a rate of 8% per annum, which is paid quarterly. Interest is payable in cash or at the Company's option in shares of common stock, provided certain conditions are met, based on a share value equal to the lesser of (a) 90% of the average of the volume weighted average price (the "VWAP") for the 20 consecutive trading days prior to the applicable interest payment date and (b) 100% of the average of the VWAP for the 20 consecutive trading days prior to the applicable interest payment date less $1.00. If any Event of Default (as defined in the Debentures) occurs, the outstanding principal amount of the Debentures, plus accrued but unpaid interest, liquidated damages and other amounts owing in respect thereof through the date of acceleration, shall become, at the holder's election, immediately due and payable in cash. Commencing five days after the occurrence of any Event of Default that results in the eventual acceleration of the Debentures, the interest rate on the Debentures shall accrue at an interest rate equal to the lesser of 18% per annum or the maximum rate permitted under applicable law. The Bridge Note Conversion Price is subject to "full ratchet" and other customary anti-dilution protections. | 'On February 1, 2015 and May 1, 2015, the Company is obligated to redeem an amount equal to $280,000 and on August 1, 2015, the Company is obligated to redeem an amount equal to $560,000 (plus accrued but unpaid interest, liquidated damages and any other amounts then owing in respect of the Bridge Note) (collectively, the "Periodic Redemption Amount"). In lieu of a cash redemption and subject to the Company meeting certain equity conditions described in the Bridge, the Company may elect to pay the Periodic Redemption Amount in shares of its common stock based on a conversion price equal to the lesser of (a) $2.90 per share, subject to adjustments upon certain events, and (b) 90% of the average of the VWAP for the 20 consecutive trading days prior to the applicable redemption date. |
On September 1, 2014, October 1, 2014, November 1, 2014, December 1, 2014, January 1, 2015 and February 1, 2015, the Company is obligated to redeem an amount equal to $51,333 and on March 1, 2015, the Company is obligated to redeem an amount equal to $308,000 (plus accrued but unpaid interest, liquidated damages and any other amounts then owing in respect of the August Convertible Notes) (collectively, the “Periodic Redemption Amount”). In lieu of a cash redemption and subject to the Company meeting certain equity conditions described in the August Convertible Notes, the Company may elect to pay the Periodic Redemption Amount in shares of its common stock based on a conversion price equal to the lesser of (a) $6.80 per share, subject to adjustments upon certain events, and (b) 90% of the average of the VWAP for the 20 consecutive trading days prior to the applicable redemption date. | ||||||||||||||||||||||||||||||||||
Convertible notes annual interest rate | ' | 12.00% | 8.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8.00% | ' |
Value of convertible note | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 194,381 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Convertible notes per unit issued price | ' | 200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gross proceeds from secured notes payable | 1,130,000 | 2,000,000 | 616,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,680,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,000,000 | ' |
Percentage of original issue discount | 0.20% | 0.20% | 12.00% | 0.20% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 12.00% | 12.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 12.00% | ' |
Convertible note redemption amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 140,000 | 140,000 | 140,000 | 140,000 | 140,000 | 140,000 | 840,000 | ' | ' | ' | ' |
Convertible notes, conversion price per share | ' | ' | $6.80 | ' | $25 | ' | $25 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $6.80 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $2.90 | ' |
Convertible Notes Conversion Price , description | ' | ' | ' | ' | ' | ' | 'The Conversion Price Reset will be available on the earlier of (the "Reset Date") (i) the date of maturity of the 12% Notes or (ii) the completion of a subsequent financing by the Company of at least $5,000,000, if the closing price of the Company's stock is less than $30.00 on the Reset Date. For (i) the conversion price after the reset will be equal to 70% of the 5-day VWAP immediately preceding the Reset Date. For (ii) the Conversion Price after the reset will be equal to 70% of 5-day VWAP immediately after the Reset Date. | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Convertible Note Warrants | ' | ' | 90,588 | ' | ' | ' | ' | ' | ' | 45,200 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 247,059 | ' | ' | ' | ' | ' | ' | ' | ' | 302,762 | ' | 345,868 | ' |
Per share price of convertible note warrants | ' | ' | $8.20 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $8.20 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $3.50 | ' |
Fair value of the convertible note warrants and debt conversion feature | 272,697 | 1,353,720 | 113,091 | 272,697 | 111,808 | ' | 111,808 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,423,177 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Warrants converted in to number of common stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 22,536 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 70,000 | ' | ' | ' |
Additional fees for legal and escrow agent | ' | ' | ' | ' | ' | ' | 96,556 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of free trading shares sold by non-affiliated. third party shareholders | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 62,600 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Funds raised in convertible notes offering paid as commission | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | 100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Broker warrants period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock Exercise Price | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $8.20 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Legal Fees | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 117,446 | ' | 12,065 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 70,405 | ' |
Professional Fees | ' | ' | ' | ' | 337,222 | 818,666 | 1,004,927 | 1,427,389 | ' | ' | ' | ' | ' | 85,207 | ' | 50,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50,000 | ' |
Convertible note warrants issued | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 125,200 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share price of 62,600 Convertible Note Warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $50 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Convertible note warrants exercisable at $0.50 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 62,600 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Non accountable reimbursement expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt conversion converted instrument amount | ' | ' | ' | ' | ' | ' | 6,800,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,337,143 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt conversion cancelled amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 342,857 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amortized under Loss from Extinguishment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 568,341 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Discount, net | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 145,729 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 231,349 | ' | ' |
Debt Discount, gross | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $714,070 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Derivative_Liability_Details
Derivative Liability (Details) (USD $) | 9 Months Ended | 12 Months Ended |
Mar. 31, 2014 | Jun. 30, 2013 | |
Summary of roll forward of fair value of warrant liability | ' | ' |
Beginning Balance | $1,660,440 | $0 |
Issuance of Warrants | 224,899 | 7,252,283 |
Repurchase / Exercise / Cancellation of Warrants | -57,129 | -179,884 |
Change in fair value | -1,708,651 | -5,411,959 |
Ending Balance | $119,559 | $1,660,440 |
Derivative_Liability_Details_T
Derivative Liability (Details Textual) (USD $) | 0 Months Ended | 1 Months Ended | 0 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 0 Months Ended | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 1 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 0 Months Ended | 1 Months Ended | 0 Months Ended | 1 Months Ended | 0 Months Ended | 1 Months Ended | 0 Months Ended | 9 Months Ended | 0 Months Ended | 1 Months Ended | 0 Months Ended | 1 Months Ended | 9 Months Ended | 1 Months Ended | 0 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Mar. 28, 2013 | Aug. 29, 2013 | Jul. 12, 2012 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Jun. 30, 2013 | Jun. 30, 2012 | Sep. 30, 2013 | Jun. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Sep. 30, 2013 | Jun. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Apr. 08, 2013 | Apr. 30, 2013 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Mar. 31, 2014 | Jun. 30, 2013 | Jun. 30, 2012 | Aug. 29, 2013 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2014 | Jun. 30, 2013 | Jun. 21, 2013 | Mar. 28, 2013 | Dec. 21, 2012 | Aug. 29, 2013 | 8-May-13 | Jun. 30, 2012 | Feb. 08, 2013 | Dec. 06, 2012 | Aug. 29, 2013 | Dec. 10, 2012 | Dec. 12, 2012 | Sep. 10, 2012 | Jul. 12, 2012 | Aug. 24, 2012 | Jul. 31, 2012 | Jul. 20, 2012 | Mar. 31, 2014 | Jun. 30, 2013 | Mar. 28, 2013 | Mar. 31, 2014 | Mar. 28, 2013 | Mar. 28, 2013 | Dec. 21, 2012 | Jun. 30, 2012 | Aug. 29, 2013 | Jun. 20, 2013 | Mar. 28, 2013 | Mar. 28, 2013 | Jun. 20, 2013 | Jun. 20, 2013 | Mar. 28, 2013 | Sep. 24, 2012 | Sep. 07, 2012 | Mar. 31, 2014 | Jun. 30, 2013 | Mar. 31, 2014 | Jul. 20, 2012 | Jul. 31, 2012 | Aug. 24, 2012 | Sep. 10, 2012 | Dec. 06, 2012 | Dec. 10, 2012 | Dec. 12, 2012 | Feb. 08, 2013 | |
Minimum [Member] | Minimum [Member] | Minimum [Member] | Minimum [Member] | Minimum [Member] | Minimum [Member] | Minimum [Member] | Minimum [Member] | Minimum [Member] | Minimum [Member] | Maximum [Member] | Maximum [Member] | Maximum [Member] | Maximum [Member] | Maximum [Member] | Maximum [Member] | Maximum [Member] | Maximum [Member] | Maximum [Member] | Maximum [Member] | Warrant [Member] | Warrant [Member] | Warrant [Member] | Warrant [Member] | Warrant [Member] | Warrant [Member] | Warrant [Member] | Warrant [Member] | Warrant [Member] | Warrant [Member] | Warrant [Member] | Warrant [Member] | Warrant [Member] | Warrant [Member] | Warrant [Member] | Warrant [Member] | Convertible Debt [Member] | Convertible Debt [Member] | Convertible Debt [Member] | Convertible Debt [Member] | Convertible Debt [Member] | Convertible Debt [Member] | Licensors Warrants [Member] | Licensors Warrants [Member] | Broker Warrants [Member] | Broker Warrants [Member] | Broker Warrants [Member] | Broker Warrants [Member] | Broker Warrants [Member] | Broker Warrants [Member] | Broker Warrants [Member] | Broker Warrants [Member] | Broker Warrants [Member] | Broker Warrants [Member] | Broker Warrants [Member] | Broker Warrants [Member] | Convertible Note Warrants [Member] | Convertible Note Warrants [Member] | Convertible Note Warrants [Member] | Convertible Note Warrants [Member] | Convertible Note Broker Warrants [Member] | Convertible Note Broker Warrants [Member] | Convertible Note Broker Warrants [Member] | Convertible Note Broker Warrants [Member] | Convertible Note Broker Warrants [Member] | Convertible Note Broker Warrants [Member] | August Convertible Note Offering [Member] | August Convertible Note Offering [Member] | Short-term Note [Member] | Short-term Note [Member] | Short-term Note [Member] | Initial Closing [Member] | Initial Closing [Member] | Initial Closing [Member] | Second Closing [Member] | Third Closing [Member] | Fourth Closing [Member] | Fifth Closing [Member] | Sixth Closing [Member] | Seventh Closing [Member] | Eighth Closing [Member] | Ninth Closing [Member] | ||||||||||
Series Warrant [Member] | Series B Warrrant [Member] | Series C Warrrant [Member] | Series D Warrrant [Member] | Series E Warrrant [Member] | Series Warrant [Member] | Series B Warrrant [Member] | Series C Warrrant [Member] | Series D Warrrant [Member] | Series E Warrrant [Member] | Series C Warrrant [Member] | Minimum [Member] | Minimum [Member] | Maximum [Member] | Maximum [Member] | Level 2 [Member] | Level 2 [Member] | Level 2 [Member] | Level 2 [Member] | Exercise price $50.00 [Member] | Exercise price $25.00 [Member] | Exercise price $25.00 [Member] | Convertible Note Warrants [Member] | Notes | Notes | Convertible Debt [Member] | Convertible Debt [Member] | Convertible Debt [Member] | Private Placement Offering [Member] | Private Placement Offering [Member] | Private Placement Offering [Member] | Private Placement Offering [Member] | Private Placement Offering [Member] | Private Placement Offering [Member] | Private Placement Offering [Member] | Private Placement Offering [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Series C Warrrant [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Liability (Textual) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock reserved for future issuance | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 747,354 | ' | ' | ' | ' | ' | ' | ' | 396,288 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of common stock repurchase | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 999,680 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of warrants cancelled | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,200 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Conversion of bridge notes and convertible debt | ' | ' | ' | ' | ' | $1,953,143 | $1,925,030 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Warrant exercisable term | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '10 years | '10 years | '5 years | '5 years | ' | '5 years | '5 years | '5 years | '5 years | '5 years | '5 years | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | '5 years | ' | '5 years | ' | ' | '5 years | '5 years | '5 years | '5 years | '5 years | '5 years | '5 years | '5 years |
Number of bridge warrants received by bridge holder | ' | ' | 77,002 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of bridge note warrants exercisable at $25.00 per share | ' | ' | 38,501 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of bridge note warrants exercisable at $0.50 per share | ' | ' | 38,501 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Per share price of 38,501 Bridge Warrants | ' | ' | $25 | ' | ' | ' | ' | $1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Per share price of another 38,501 Bridge Warrants | ' | ' | $50 | ' | ' | ' | ' | $1.50 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Warrants, exercise price | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | 1.5 | 3 | 1 | 1 | ' | ' | ' | ' | ' | 25 | 50 | 100 | 25 | 25 | 25 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.082 | ' | ' | ' | ' | 12 | 24 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8.2 | ' | ' | ' | ' | 8.2 | 25 | 25 | ' | ' | ' | 0.03 | ' | ' | ' | ' | ' | ' | ' | ' |
Number of common stock purchase due to issuance of warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Sale price of unit | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.25 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of PPO units due to conversion of Bridge notes | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 77,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of Investor warrants due to conversion of Bridge Notes | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 77,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Proceeds from private offering | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 125,000 | ' | ' | 31,000 | 409,980 | 125,000 | 20,000 | 150,000 | 50,000 | 25,000 | 50,000 |
Number of PPO units sold | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 500,000 | ' | ' | 1,240 | 16,400 | 5,000 | 800 | 6,000 | 2,000 | 1,000 | 200,000 |
Description of private placement offering | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'If at any time during the two year period following the closing of the Offering the Company issues additional shares of common stock for consideration per share of less than $25.00 (the "Reduced Price"), then the Company agreed to issue to the investors in the Offering, concurrently with such issue and without any additional consideration from the investors, a number of additional shares of the Company's common stock and Investor Warrants equal to the difference between (A) the purchase price of the PPO Units being subscribed for divided by the Reduced Price and (B) the number of shares of the Company's common stock included in the units being subscribed for in the subsequent offering. | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of common stock consisting due to PPO | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,240 | 16,400 | 5,000 | 800 | 6,000 | 2,000 | 1,000 | 2,000 |
Number of investor warrants consisting due to PPO | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,500 | 1,200 | ' | ' | ' | ' | 1,240 | 16,400 | 5,000 | 800 | 6,000 | 2,000 | 1,000 | 2,000 |
Exercise price of investor warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $13 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $1 | ' | ' | $100 | $100 | $100 | $100 | $100 | $100 | $100 | $100 |
Warrant issued during period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 116,640 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 160 | 720 | ' | 720 | 720 | 1,876 | 6,560 | 1,876 | 1,876 | 1,876 | ' | ' | ' | ' | ' | ' | 16,000 | ' | 90,590 | 19,122 | ' | ' | 752,126 | 247,060 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of notes | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Exercise price of broker warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $25 | $25 | ' | $25 | $25 | $25 | $25 | $0.25 | $25 | $25 | ' | ' | ' | ' | ' | ' | ' | ' | ' | $8.20 | ' | $25 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Principal amount of note | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fair value of the warrants | ' | ' | ' | ' | ' | 224,899 | ' | 7,252,283 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 42,625 | 210,349 | ' | 155,716 | 1,067,196 | 297,716 | 888,596 | 3,788,687 | 113,091 | 7,252,283 | ' | ' | ' | ' | ' | ' | ' | ' | 491,051 | 50,240 | 663,528 | 25,827 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 222,457 | 686,192 | ' | ' | 57,143 | 60,886 | ' | 60,886 | ' | 57,143 | ' | ' | 9,482 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Convertible Note Warrants | ' | 90,588 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 45,200 | ' | 22,600 | 22,600 | 137,238 | 1,912,195 | 85,293 | ' | 2,704,000 | 9,040 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Convertible note warrants exercisable at $0.50 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 62,600 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share price of 62,600 Convertible Note Warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $50 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Convertible note warrants issued | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 125,200 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expected volatility rate | ' | ' | ' | ' | ' | 80.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 65.00% | 55.00% | 80.00% | 65.00% | 55.00% | 55.00% | 60.00% | 70.00% | 73.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | 55.00% | 55.00% | 60.00% | 65.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 55.00% | 60.00% | ' | ' | ' | 55.00% | 65.00% | 55.00% | ' | 55.00% | 55.00% | ' | 70.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Risk free interest rate | ' | ' | ' | ' | ' | 2.10% | ' | ' | ' | 1.57% | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.90% | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.57% | 1.69% | 2.10% | ' | 1.69% | 1.01% | 0.95% | 0.83% | 2.02% | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.69% | 1.01% | 0.95% | 1.90% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.01% | 0.95% | ' | ' | ' | 1.69% | 1.90% | 1.69% | ' | 1.01% | 1.69% | ' | 0.83% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expected term | ' | ' | ' | ' | ' | ' | ' | ' | ' | '18 months | '18 months | '5 years | '5 years | '14 months | ' | ' | ' | ' | ' | '5 years | '10 years | '8 years | '10 years | '10 years | ' | ' | ' | ' | ' | '5 years | '5 years | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' | '14 months | '15 months | '10 years | '9 years 1 month 6 days | ' | ' | '18 months | '5 years | ' | '18 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | '5 years | '5 years | '5 years | ' | '5 years | '5 years | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expected dividend rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.00% | 0.00% | 0.00% | 0.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.00% | ' | ' | ' | ' | 0.00% | 0.00% | 0.00% | ' | 0.00% | 0.00% | ' | 0.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Derivative liability | ' | ' | ' | 119,559 | ' | 119,559 | ' | 1,660,440 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,660,440 | ' | ' | ' | 527,606 | 1,660,440 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Derivative liability (gain) / loss | ' | ' | ' | -462,726 | -3,646,420 | -1,708,651 | -3,299,793 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,411,959 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase in warrants exercise price | ' | ' | ' | ' | ' | ' | ' | 0.25 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Broker warrants issued shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8,516 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Repurchase / Exercise / Cancellation of Warrants | ' | ' | ' | ' | ' | ($57,129) | ' | ($179,884) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Convertible note warrants, exercise price description | ' | ' | ' | ' | ' | 'The Company lowered the exercise price of the 80,000 Convertible Note Warrants issued as of December 21, 2012 from $100.00 to $50.00 and from $50.00 to $25.00 and lowered the exercise price of 16,000 Convertible Note Broker Warrants to $25.00. | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Loss_from_Debt_Extinguishment_
Loss from Debt Extinguishment (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Jun. 30, 2013 | |
Loss From Extinguishment Of Debt (Textual) | ' | ' | ' | ' | ' |
Series A Preferred Stock shares issued upon conversion | ' | ' | 3,906 | ' | ' |
Loss from debt extinguishment | $2,760,640 | ' | $2,760,640 | ' | ' |
Non - cash loss from Extinguishment of Debt adjusted fair value | ' | ' | -1,952,861 | ' | ' |
Non cash gain from Extinguishment of debt | ' | ' | 807,780 | ' | ' |
Series A Preferred Stock conversion price | $6.80 | ' | $6.80 | ' | ' |
Preferred stock, par value | $0.00 | ' | $0.00 | ' | $0.00 |
Series A Preferred Stock [Member] | ' | ' | ' | ' | ' |
Loss From Extinguishment Of Debt (Textual) | ' | ' | ' | ' | ' |
Preferred stock, par value | $1,000 | ' | $1,000 | ' | ' |
Preferred stock conversion limit in common stock | 3,000,000 | ' | 3,000,000 | ' | ' |
June and August Convertible Notes [Member] | ' | ' | ' | ' | ' |
Loss From Extinguishment Of Debt (Textual) | ' | ' | ' | ' | ' |
Convertible notes payable | $1,953,143 | ' | $1,953,143 | ' | ' |
Commitments_and_Contingencies_
Commitments and Contingencies (Details) (USD $) | 9 Months Ended | 9 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | ||||||||||||||||||||||||
Mar. 31, 2014 | Jun. 30, 2013 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | |
PPO Offering Registration Rights [Member] | Convertible Note Registration Rights Agreement [Member] | Registration Agreement [Member] | Minimum [Member] | Maximum [Member] | Royalty Agreement One [Member] | Royalty Agreement One [Member] | Royalty Agreements One Contract Period Two [Member] | Royalty Agreements One Contract Period Two [Member] | Royalty Agreements One Contract Period Three [Member] | Royalty Agreements One Contract Period Three [Member] | Royalty Agreements One Contract Period Four [Member] | Royalty Agreements One Contract Period Four [Member] | Royalty Agreements Two [Member] | Royalty Agreements Two Period Two [Member] | Royalty Agreements Two Period Three [Member] | Operating Lease Agreement One [Member] | Operating Lease Agreement One [Member] | Operating Lease Agreement One [Member] | Operating Lease Agreement One [Member] | Operating Lease Agreement Two [Member] | Operating Lease Agreement Two [Member] | Operating Lease Agreement Two [Member] | Operating Lease Agreement Two [Member] | Operating Lease Agreement Three [Member] | Operating Lease Agreement Three [Member] | Operating Lease Agreement Three [Member] | Operating Lease Agreement Three [Member] | Royalty Agreements Three [Member] | Royalty Agreements Three Period Two [Member] | Royalty Agreements Three Period Three [Member] | |||
Minimum [Member] | Maximum [Member] | Minimum [Member] | Maximum [Member] | Minimum [Member] | Maximum [Member] | Minimum [Member] | Maximum [Member] | ||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Guaranteed royalty payment under agreements | ' | ' | ' | ' | ' | ' | ' | $4,686,125 | $4,985,000 | $925,000 | $1,000,000 | $1,188,625 | $1,285,000 | $1,572,500 | $1,700,000 | $600,000 | $225,000 | $275,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $33,333 | $33,334 |
Term of operating lease | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '1 year | ' | ' | ' | '5 months | ' | ' | ' | ' | ' | ' | ' | ' |
Operating lease monthly rent payment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,785 | ' | ' | ' | 1,500 | ' | ' | ' | 3,100 | ' | ' | ' | ' |
Number of days in which bond amount need to deposit on entry of injunction | '7 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Operating lease rent expense included in general and administrative expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,570 | 5,355 | 14,280 | 16,065 | 3,000 | 4,500 | 12,000 | 4,500 | 3,100 | 0 | 3,100 | 0 | ' | ' | ' |
Common stock, shares authorized | 3,000,000 | 3,000,000 | ' | ' | 3,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock, shares issued | 1,575,250 | 1,553,015 | ' | ' | 1,576,976 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock, shares outstanding | 1,566,979 | 1,543,018 | ' | ' | 1,566,979 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock, Voting rights | 'Each share of common stock entitles the holder to one vote on all matters submitted to a vote. | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Description of registration payment arrangement | ' | ' | '(i) The Company's common stock underlying the Bridge Warrants (as defined in Note 6), (ii) common stock underlying the PPO Units (as defined in Note 6) sold or to be sold in the Offering, and (iii) common stock underlying the Investor Warrants (as defined in Note 6) (including securities issued in the Offering as a result of the conversion of the Bridge Notes (as defined in Note 6), but not common stock that is issuable upon exercise of the broker warrants issued to the placement agent for the Offering) (collectively, the "Registrable Securities") no later than October 29, 2012 (the "Filing Date"). | '(i) The Common Stock underlying the Warrants and (ii) the Common Stock underlying the Notes (collectively, the "Convertible Note Registrable Securities") within 45 days from the final closing of the Offering (the "Filing Date"), and to use its commercially reasonable efforts to cause the registration statement to become effective no later than 90 days after it is filed (the "Effectiveness Date"). | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Liquidated damages maximum liability rate | 1.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Penalty accrued as percentage of original purchase price paid by investor | 10.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of interest rate payable to investor | 8.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accrued expenses | 206,381 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 815,370 | ' | ' |
Registration payment arrangement default penalty percentage | ' | ' | ' | ' | ' | 0.50% | 6.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accrued settlement costs | $800,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Equity_Transactions_Details
Equity Transactions (Details) (USD $) | 0 Months Ended | 3 Months Ended | 9 Months Ended |
Oct. 03, 2013 | Sep. 30, 2013 | Mar. 31, 2014 | |
Board [Member] | |||
Equity Transactions (Textual) | ' | ' | ' |
Issuance of stock | 1,000 | ' | 7,441 |
Value of stock issued | $2,490 | $6,060 | $6,250 |
Stock_Compensation_Expense_and2
Stock Compensation Expense and Fair Value Measurement (Details) | Mar. 31, 2014 | Jul. 12, 2012 | Aug. 15, 2012 | Nov. 21, 2012 | Mar. 28, 2013 | Apr. 08, 2013 | Jun. 28, 2013 | Jul. 12, 2013 | Aug. 15, 2013 |
Stock options [Member] | Stock options one [Member] | Stock options two [Member] | Stock option three [Member] | Stock option four [Member] | Stock option five [Member] | Stock option six [Member] | Stock option seven [Member] | ||
Summary of relevant inputs used to determine the value of the stock option grants | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of options outstanding | 177,800 | 36,000 | 3,975 | 5,000 | 0 | 5,000 | 250 | 114,000 | 13,575 |
Weighted average risk-free rate | ' | 0.83% | 0.83% | 0.95% | 1.01% | 1.69% | 1.69% | 1.72% | 1.86% |
Expected life in years | ' | '3 years 6 months | '6 years | '6 years | '6 years | '6 years | '6 years | '3 years 6 months | '6 years |
Expected volatility | ' | 70.00% | 70.00% | 60.00% | 55.00% | 55.00% | 55.00% | 65.00% | 65.00% |
Expected dividends | ' | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
Stock_Compensation_Expense_and3
Stock Compensation Expense and Fair Value Measurement (Details Textual) (USD $) | 3 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | 0 Months Ended | ||||||||||
Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Aug. 15, 2013 | Jul. 12, 2013 | Jun. 28, 2013 | Apr. 08, 2013 | Mar. 28, 2013 | Nov. 21, 2012 | Aug. 15, 2012 | Jul. 12, 2012 | Mar. 31, 2014 | Jul. 31, 2012 | Jul. 12, 2012 | Mar. 31, 2014 | Jul. 12, 2012 | |
Equity Incentive Plan 2012 [Member] | Equity Incentive Plan 2012 [Member] | Equity Incentive Plan 2012 [Member] | Equity Incentive Plan 2012 [Member] | Equity Incentive Plan 2012 [Member] | Equity Incentive Plan 2012 [Member] | Equity Incentive Plan 2012 [Member] | Equity Incentive Plan 2012 [Member] | Equity Incentive Plan 2012 [Member] | Equity Incentive Plan 2012 [Member] | Equity Incentive Plan One 2012 [Member] | Equity Incentive Plan One 2012 [Member] | Equity Incentive Plan Two 2012 [Member] | |||||
Stock Compensation Expense (Textual) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock reserved for future issuance | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 177,800 | 200,000 | ' | ' | ' |
Stock options issued during period | ' | ' | ' | ' | 13,575 | 114,000 | 5,000 | 5,000 | 5,000 | 5,000 | 4,000 | 46,000 | ' | ' | 36,000 | ' | 10,000 |
Term of stock options | ' | ' | ' | ' | '10 years | '5 years | '10 years | '10 years | '10 years | '10 years | '10 years | '5 years | ' | ' | '5 years | ' | '10 years |
Exercise price of common stock | ' | ' | ' | ' | $5 | $6 | $5 | $14 | $17 | $24 | $24 | $24 | ' | ' | ' | ' | ' |
Option vesting period | ' | ' | ' | ' | '3 years | ' | '3 years | '3 years | '3 years | '3 years | '3 years | ' | ' | ' | ' | ' | ' |
Option vesting condition | ' | ' | ' | ' | 'which will vest annually at a rate of 33% beginning on the first anniversary date of the grant | 'which will vest annually at a rate of 33% beginning on the first anniversary of the grant date | 'which will vest annually at a rate of 33% beginning on the first anniversary date of the grant, in each case. | 'which will vest annually at a rate of 33% beginning on the first anniversary date of the grant, in each case. | 'which will vest annually at a rate of 33% beginning on the first anniversary date of the grant, in each case. | 'which will vest annually at a rate of 33% beginning on the first anniversary date of the grant, in each case. | 'which will vest annually at a rate of 33% beginning on the first anniversary date of the grant, in each case. | 'which will vest annually at a rate of 33% beginning on the first anniversary date of the Merger, in each case. | ' | ' | ' | ' | ' |
Stock compensation expense | $147,436 | $162,808 | $472,397 | $452,087 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fair value of the stock options | $1,042 | ' | $1,042 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock option, Forfeited | ' | ' | 15,275 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,000 | ' | ' | 25 | ' |
Income_Taxes_Details
Income Taxes (Details) | 9 Months Ended |
Mar. 31, 2014 | |
Summary of Company's effective tax rate reconciliation | ' |
Statutory rate | 34.00% |
State income taxes | 5.80% |
Permanent differences | 2.30% |
Valuation allowance | -42.50% |
Other | 0.40% |
Total | 0.00% |
Income_Taxes_Details_1
Income Taxes (Details 1) (USD $) | Mar. 31, 2014 | Jun. 30, 2013 |
Summary of principal components of deferred tax assets and (liabilities) | ' | ' |
Net operating losses carryforward | $4,197,125 | $2,002,842 |
Start-up costs and fixed assets, net of amortization | 120,011 | 60,005 |
Property and equipment | 159,025 | 56,270 |
Stock based compensation | 399,261 | 192,786 |
Gross deferred taxes | 4,875,422 | 2,311,903 |
Valuation allowance | -4,875,422 | -2,311,903 |
Net deferred taxes | ' | ' |
Income_Taxes_Details_Textual
Income Taxes (Details Textual) (USD $) | 9 Months Ended | |
Mar. 31, 2014 | Jun. 30, 2013 | |
Income Taxes (Textual) | ' | ' |
Gross deferred taxes of federal and state | $4,875,422 | $2,311,903 |
Operating loss carryforwards, expiration date | 31-Dec-33 | ' |
Valuation reserve | 100.00% | ' |
Federal statutory income tax rate | 34.00% | ' |
Related_Party_Transactions_Det
Related Party Transactions (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | |
Related Party Transactions (Textual) | ' | ' | ' | ' |
Due to Gold Grenade | $234,550 | $0 | $234,550 | $0 |
Product development fees payable to Gold Grenade | $140,000 | $210,000 | $640,000 | $622,700 |
Subsequent_Events_Details
Subsequent Events (Details) (USD $) | 1 Months Ended | 0 Months Ended | 1 Months Ended |
Aug. 29, 2013 | Jun. 05, 2014 | Jun. 18, 2014 | |
Subsequent Event [Member] | Subsequent Event [Member] | ||
Subsequent Events Textual [Abstract] | ' | ' | ' |
Original Issue Discount Promissory Note | ' | $80,000 | $60,000 |
Promissory note, maturity date | ' | 6-Jul-14 | 18-Jul-14 |
Promissory note, interest rate terms | ' | ' | ' |
The August Convertible Notes bear interest at a rate of 8% per annum, which is paid quarterly. Interest is payable in cash or at the Company’s option in shares of common stock, provided certain conditions are met, based on a share value equal to the lesser of (a) 90% of the average of the volume weighted average price (the “VWAP”) for the 20 consecutive trading days prior to the applicable interest payment date and (b) 100% of the average of the VWAP for the 20 consecutive trading days prior to the applicable interest payment date less $1.00. Upon any Event of Default (as defined in the August Convertible Notes), the outstanding principal amount of each August Convertible Note, plus liquidated damages, interest, a premium of 30% and other amounts owing in respect thereof through the date of acceleration, shall become, at the noteholders’ election, immediately due and payable in cash. Commencing five days after the occurrence of any Event of Default, the interest rate on each August Convertible Note shall accrue at an interest rate equal to the lesser of 18% per annum or the maximum rate permitted under applicable law. The August Conversion Price is subject to “full ratchet” and other customary anti-dilution protections. | The interest rate on the OID Note shall accrue at the rate of eighteen (18) percent per annum, or such lower maximum amount of interest permitted to be charged under applicable law. | The interest rate on the OID Note shall accrue at the rate of eighteen (18) percent per annum, or such lower maximum amount of interest permitted to be charged under applicable law. |