Generation NEXT Franchise Brands (VEND) 10-Q 14 Feb 19 2019 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Dec. 31, 2018	Feb. 05, 2019
Document and Entity Information [Abstract]
Entity Registrant Name	Generation NEXT Franchise Brands, Inc.
Entity Central Index Key	1,526,689
Trading Symbol	vend
Current Fiscal Year End Date	--06-30
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		70,066,461
Document Type	10-Q
Document Period End Date	Dec. 31, 2018
Amendment Flag	false
Document Fiscal Year Focus	2,019
Document Fiscal Period Focus	Q2
Entity Small Business	true
Entity Emerging Growth Company	false

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($)	Dec. 31, 2018	Jun. 30, 2018
Current assets:
Cash	$ 408,745	$ 10,017,667
Restricted cash	4,582,430	3,710,694
Accounts receivable		54,128
Contract assets - due from franchisees	4,987,893	7,250,951
Stock subscriptions receivable		300,000
Inventory on-hand, net of allowance for obsolete inventory of $400,000 and $300,000, respectively	11,864,000	3,011,484
Deposit for inventory	2,699,140	5,152,897
Prepaid expenses and other current assets	80,389	70,149
Current assets held for disposition		292,664
Total current assets	24,622,597	29,860,634
Property and equipment, less accumulated depreciation of $89,924 and $115,889, respectively	100,756	199,791
Intangible assets, net of accumulated amortization of $881,492 and $686,052, respectively	1,674,684	1,870,124
Deposits	58,321	45,404
Total assets	26,456,358	31,975,953
Current liabilities:
Accounts payable and accrued liabilities	7,360,124	4,531,547
Contract liabilities - customer advances and deferred revenues	35,518,951	37,221,943
Provision for franchisee rescissions and refunds	3,985,132	1,924,121
Accrued personnel expenses	407,371	553,314
Notes payable, net of discount of $49,716 and $49,716, respectively	1,042,139	879,017
Contingent liability	200,000	200,000
Due to related party	296,779	536,786
Deferred rent	46,342	34,541
Current liabilities held for disposition		1,291,676
Total current liabilities	48,856,838	47,172,945
Notes payable - long term, net of discount of $24,852 and $49,716, respectively	330,496	736,115
Total liabilities	49,187,334	47,909,060
Commitments and contingencies (Notes 5 and 7)
Stockholders' deficit:
Preferred stock; $0.001 par value; 25 million shares authorized; no shares issued and outstanding
Common stock; $0.001 par value; 100 million shares authorized; 71,443,367 and 69,378,052 outstanding, respectively	71,442	69,376
Additional paid-in capital	30,471,033	27,515,602
Accumulated deficit	(53,273,451)	(43,518,085)
Total stockholders' deficit	(22,730,976)	(15,933,107)
Total liabilities and stockholders' deficit	$ 26,456,358	$ 31,975,953

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parentheticals) - USD ($)	Dec. 31, 2018	Jun. 30, 2018
Statement Of Financial Position [Abstract]
Allowance for obsolete inventory	$ 400,000	$ 300,000
Accumulated depreciation	89,924	115,889
Accumulated amortization	881,492	686,052
Discount on notes payable	49,716	49,716
Discount on long term notes payable	$ 24,852	$ 49,716
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized	25,000,000	25,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares outstanding	71,443,367	69,378,052

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Revenues:
Total revenue, net	$ 4,514,461	$ 35,596	$ 6,272,455	$ 97,427
Cost of sale	4,211,809	2,500	5,872,925
Gross profit	302,652	33,096	399,530	97,427
Operating expenses:
Personnel	1,003,717	786,972	2,339,135	1,743,924
Marketing	487,830	707,422	1,285,875	1,454,177
Professional fees	700,040	76,960	1,126,146	212,519
Insurance	88,283	66,314	170,228	118,722
Rent	70,681	47,983	124,970	91,078
Depreciation and amortization	110,701	107,236	222,099	212,915
Stock compensation	711,195		1,473,729	124,375
Research development and engineering	1,224,701	1,023,223	2,223,706	1,924,630
Provision for franchisee refund	49,218		132,691	9,000
Other	477,902	228,981	1,023,542	430,823
Total operating expenses	4,924,268	3,045,091	10,122,121	6,322,163
Loss from operations	(4,621,616)	(3,011,995)	(9,722,591)	(6,224,736)
Other expenses:
Interest expense	(46,109)	(70,779)	(81,701)	(145,002)
Accretion of discount on notes payable	(12,429)		(24,858)
Loss on disposition of assets	(72,375)		(72,375)
Other income	4,657		4,657
Loss before provision for income taxes	(4,747,872)	(3,082,774)	(9,896,868)	(6,369,738)
Provision for income taxes	0	0	0	0
Loss from continuing operations	(4,747,872)	(3,082,774)	(9,896,868)	(6,369,738)
Gain (loss) from discontinued operations		(704,794)	141,502	(1,405,146)
Net loss	$ (4,747,872)	$ (3,787,568)	$ (9,755,366)	$ (7,774,884)
Net loss per share - basic and diluted (in dollars per share)	$ (0.07)	$ (0.14)	$ (0.14)	$ (0.21)
Weighted average shares used in computing net loss per share - basic and diluted (in shares)	70,069,253	27,978,580	70,069,253	37,748,979
Vending machine sales, net
Revenues:
Total revenue, net	$ 4,407,121	$ 323	$ 6,094,621	$ 427
Franchise fees
Revenues:
Total revenue, net	10,927		12,511
Company owned machine sales
Revenues:
Total revenue, net	13,354	34,273	42,425	96,000
Royalties
Revenues:
Total revenue, net	50,500		68,132
Other
Revenues:
Total revenue, net	$ 32,559	$ 1,000	$ 54,766	$ 1,000

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)	6 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Cash flows from operating activities:
Net loss	$ (9,755,366)	$ (7,774,884)
Adjustments to reconcile net loss to net cash flows provided by operating activities:
Depreciation and amortization	222,099	212,915
Interest accretion on notes payable	24,858	45,258
Loss on derivative liability		220,003
Disposal of asset	72,376
Stock-based compensation	1,473,729	280,329
Deferred rent	11,801	14,072
Bad debt expense		(24,699)
Stock issued for services	30,057
Changes in operating assets and liabilities:
Accounts receivable	72,579	(2,316,894)
Contract asset - due from franchisee	2,263,058
Inventory on-hand	(8,606,218)	(519,562)
Deposits for inventory	2,453,757
Prepaid expenses and other current assets	(10,240)	184,042
Deferred costs		(12,098)
Deposits	(12,917)
Accounts payable and accrued liabilities	2,554,134	393,167
Customer advances and deferred revenues	(2,218,509)	7,715,542
Provision for franchisee rescissions and refunds	1,565,011	24,226
Accrued personnel expenses	(145,943)	(186,388)
Cash flows used in operating activities	(10,005,734)	(1,741,202)
Cash flows from investing activities:
Purchases of property and equipment		(56,479)
Cash flows used in investing activities		(56,479)
Cash flows from financing activities:
Proceeds from issuance of notes payable to related party		3,830,812
Payments of notes payable to related party	(240,007)	(803,864)
Payments of notes payable	(244,355)
Proceeds from issuance of common stock, net of issuance costs	1,724,993
Cash flows provided by financing activities	1,240,631	3,026,948
Change in cash and restricted cash	(8,765,103)	1,229,267
Cash and restricted cash, beginning of period	13,756,278	1,752,522
Cash and restricted cash, end of period	4,991,175	2,981,789
Cash paid for:
Interest expense	2,567	$ 121,924
Income taxes	10,215
Supplemental disclosure of non-cash investing and financing activities:
Conversion of debt and accrued interest into shares of common stock	28,717
Cashless exercise of options	$ 622

Organization and description of

Organization and description of business	6 Months Ended
	Dec. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization and description of business	1. Organization and description of business Generation NEXT Franchise Brands, Inc. (referred to herein collectively with its subsidiaries as “we”, the “Company”, “our Company”, or “GNext”) operates through its wholly-owned subsidiaries, Reis & Irvy’s, Inc. (“R&I”), 19 Degrees, Inc. and Generation Next Vending Robots, Inc. as a franchisor, direct seller, owner and operator and managing member of robotic soft serve vending kiosks that feature cashless payment devices and remote monitoring software. The Company uses in-house location specialists that are responsible for securing locations for its kiosks; additionally, the Company has negotiated discounts with certain of its consumable manufacturers and distributors. The Company also operates its own frozen yogurt equipment and is the managing member of 19 Degrees Corporate Service, LLC, a robot investment fund (the “Fund”) that will allow accredited investors (i.e. franchisees and other direct purchase investors) to contribute kiosks to the Fund and receive quarterly profit distributions. Because it was determined the assets of FHV LLC, the Company’s previous healthy vending concept, are currently insufficient to satisfy FHV LLC’s obligations to creditors, as of September 28, 2018, FHV LLC has executed an Assignment for the Benefit of Creditors under California law, whereby all of the assets of FHV LLC have been assigned to a third party fiduciary who will expeditiously liquidate such assets and distribute the proceeds thereof to FHV LLC’s creditors pursuant to the priorities established and permitted by law. During fiscal year 2017, we obtained the exclusive rights to sell a new frozen yogurt vending robot, branded Reis & Irvy’s. As of the date of this report, we have received approval to sell franchises in all U.S. states, other than South Dakota, and have booked a net 1,290 units aggregating approximately $55 million (net of installed robots and franchisee refunds) in customer advances-due from franchisees and contract liabilities- franchisees advances and deferred revenues, prior to certain offset adjustments aggregating 13.2 million. Furthermore, the Company has additional commitments for 2,666 robots aggregating $103 million. As of December 31, 2018, and through the date of this report, the Company has delivered and installed 188 frozen yogurt vending kiosks. The Company has redeveloped the next generation frozen yogurt kiosk and has spent approximately $5.2 million and $2.2 million in research, development and engineering expenses through June 30, 2018 and December 31, 2018, respectively. The Company anticipates it will continue to incur additional research, development and engineering expenses throughout fiscal 2019. On December 29, 2016, the Company entered into an Asset Purchase Agreement (the “Agreement”) with Robofusion, Inc. (“RFI”), whereby the Company acquired the intellectual property assets of RFI, a developer of robotic-kiosk vending technology, primarily frozen yogurt and ice cream vending robots, using RFI’s trademarked name of Reis & Irvy’s (the “Acquisition”). The Company considered the guidance in ASC 805, Business Combinations, Underwriters Laboratories National Sanitation Foundation NAMA”)

Summary of Significant Accounti

Summary of Significant Accounting Policies	6 Months Ended
	Dec. 31, 2018
Summary of significant accounting policies
Summary of Significant Accounting Policies	2. Summary of Significant Accounting Policies Basis of accounting The included (a) condensed consolidated balance sheet as of June 30, 2018, which has been derived from audited consolidated financial statements and (b) the unaudited condensed consolidated statements as of December 31, 2018 and for the three and six months ended December 31, 2018 and 2017, have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the rules and regulations of the Securities and Exchange Commission (“SEC”) for reporting on Form 10-Q. Accordingly, these unaudited condensed consolidated statements do not include all of the information and disclosures required by GAAP or SEC rules and regulations for complete consolidated financial statements. In the opinion of management, these unaudited condensed consolidated financial statements reflect all adjustments (consisting solely of normal recurring nature) considered necessary for a fair presentation of the results for the interim periods presented. The results of operations for any interim period are not necessarily indicative of results for the full year. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s filings with the SEC, including its most recent annual report on Form 10-K for the fiscal year ended June 30, 2018 filed on October 19, 2018. Liquidity and capital resources For the six months ended December 31, 2018 we had a net loss totaling approximately $9,755,000 with negative cash flows from operations totaling approximately $9,903,000. Our cash balance at December 31, 2018 was approximately $409,000. First, our production and installation of kiosks have been slower than anticipated, due to delays caused by engineering and manufacturing deficiencies, which have since been corrected. The impacts of production delays were decreased revenue recognition and less accounts receivable collections. Second, franchise sales during the quarter were lower than anticipated due to a late 10-k filing, which inhibited the Company’s ability to receive approved franchise documents. Also, we used cash on hand to retire liabilities associated with the franchise rescissions, for research, development and engineering expenditures related to our robotic soft serve vending kiosks and for the purchase of robot inventory. The combined result of these events was a substantial decrease in our cash balances and an increase in our outstanding liabilities. In order to ensure sufficient liquidity for our continuing operations, the Company is actively pursuing additional capital in the form of either debt or equity financing (or a combination thereof). We anticipate generating a portion of our required capital resources from deposits on sales of new franchises, unit sales of kiosks for the Fund, royalties from existing and future franchise installs and revenue from corporate-owned kiosks. Management believes the additional funding required can be obtained on terms acceptable to the Company, although there can be no assurance that we will be successful. Our current plans include research and development expenditures for the production of the next generation robot, payments required for the purchase of the Robofusion intellectual property (previous owner of the frozen yogurt robot intellectual property), capital expenditures for the purchase of franchisee and corporate-owned and operated robotic soft serve vending kiosks, as well as the repurchase of machines from franchisees opting to rescind their franchise agreements. The Company estimates current inventory balances of components are sufficient to manufacture approximately 150 – 200 fully-assembled robots. Given our current cash position, we may be forced to curtail our plans by delaying or suspending the production and purchase of robotic soft serve vending kiosks until such time that we may able to prepay for future robots. Principles of consolidation The condensed consolidated financial statements include the accounts of the Company, and its wholly-owned subsidiaries, Reis & Irvy’s, Inc., FHV LLC (recorded as discontinued operations), 19 Degrees, Inc., Generation Next Vending Robots, The Fresh and Healthy Vending Corporation, and FHV Acquisition, Corp. All significant intercompany accounts and transactions are eliminated. Use of estimates The preparation of our Company’s financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of our financial statements and the reported amounts of revenues, costs and expenses during the reporting period. Actual results could differ significantly from those estimates. Significant estimates include our provisions for bad debts, franchisee rescissions and refunds, legal estimates, stock-based compensation, derivative liability and the valuation allowance on deferred income tax assets. It is at least reasonably possible that a change in the estimates will occur in the near term. Cash and cash equivalents All investments with an original maturity of three months or less are considered to be cash equivalents. Cash equivalents primarily represent funds invested in money market funds, bank certificates of deposit and U.S. government debt securities whose cost equals fair market value. We had no cash equivalents at December 31. 2018 and June 30, 2018. We may maintain our cash and cash equivalents in amounts that may, at times, exceed federally insured limits. At December 31, 2018, bank balances, per our bank, exceeding federally insured limits totaled approximately $149,000. We have not experienced any losses with respect to cash, and we believe our Company is not exposed to any significant credit risk with respect to our cash. Certain states require the Company to maintain customer deposits in escrow accounts until the Company has substantially performed its obligations. Furthermore, certain franchisees have elected to pay their remaining balance due directly to an escrow account for the beneficiary of the Company’s contract manufacturer and inventory suppliers. At December 31, 2018 and June 30, 2018, the Company had approximately $4,582,000 and $3,710,000, respectively maintained in escrow accounts for these purposes. Contract assets – due from franchisees, net Contract assets – due from franchisees arise primarily from kiosk sales and are carried at their estimated collectible amounts, net of any estimated allowances for doubtful accounts. We grant unsecured credit to our customers deemed credit worthy. Ongoing credit evaluations are performed and potential credit losses estimated by management are charged to operations on a regular basis. At the time any particular account receivable is deemed uncollectible, the balance is charged to the allowance for doubtful accounts. Our allowance for doubtful accounts aggregated approximately $174,000 and $0 at December 31, 2018 and June 30, 2018, respectively. Inventory Inventory is carried at the lower of cost or market, with cost determined using the average cost method. Property and equipment Property and equipment are carried at cost and depreciated using the straight-line method over their estimated useful lives of the individual assets, generally five to seven years. Leasehold improvements are amortized over the lesser of the term of the related lease or the estimated useful life of the asset. Costs incurred for maintenance and repairs are expensed as incurred and expenditures for major replacements and improvements are capitalized and depreciated over their estimated remaining useful lives. Intangible assets Intangible assets consist primarily of patents, trademarks and trade names. Amortization of intangible assets is recorded as amortization expense in the consolidated statements of operations and amortized over the respective useful lives using the straight-line method. Impairment of long-lived assets Impairment losses are recognized on long-lived assets used in operations when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than the assets’ carrying amount. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amounts of the assets exceed the estimated fair value of the assets. There were no impairments of long-lived assets for the periods ended December 31, 2018 and June 30, 2018, respectively. Deferred rent The Company entered into an operating lease for our corporate offices in San Diego, California that contains provisions for future rent increases, leasehold improvement allowances and rent abatements. We record monthly rent expense equal to the total of the payments due over the lease term, divided by the number of months of the lease term. The difference between the rent expense recorded and the amount paid is credited or charged to deferred rent, which is reflected as a separate line item in the accompanying consolidated balance sheet. Revenue, contract liabilities – franchisees advances and deferred revenue, and contract assets – due from franchisees The Company relies upon ASC 606, Revenue from Contracts with Customers Reis & Irvy’s, Inc The primary revenue sources consisted of the following: · Robotic soft serve vending kiosks · Franchise fees · Royalties Revenues from robotic soft serve vending kiosks and franchise fees are recognized when the Company has substantially performed or satisfied all material services or conditions relating to the franchise agreement. Substantial performance has occurred when: 1) no remaining obligations are unfulfilled under the franchise agreement; 2) there is no intent to refund any cash received or to forgive any unpaid amounts due from franchisees; 3) all of the initial services in the franchise agreement have been performed; and 4) all other material conditions or obligations have been met. During the three and six months ended December 31, 2018, 120 and 50 robotic soft serve vending kiosks were installed and operational, respectively, and the Company had no further material conditions or obligations. There were no vending kiosks operational during the same periods in the prior year. During the three and six months ended December 31, 2018 the Company recognized revenue of approximately $1,688,000 and $4,407,00, respectively for robotic soft serve vending kiosks and approximately $1,500 and $11,000, respectively in franchise fees. Upon the execution of a franchise agreement, a deposit from the franchisee is required, and generally consists of 40% - 50% of the sales price of the frozen yogurt and ice cream robots, 50% - 100% of the initial franchise fees, and 40% - 50% of location fees. In accordance with ASC 606, the Company recognizes the contract as a contract liability – customer deposits and deferred revenue when the Company receives consideration or is due consideration. As of December 31, 2018 and June 30, 2018, the Company’s customer advances and deferred revenues were approximately $35,519,000 and $37,222,000, respectively. These amounts are net of certain off-set adjustments of $13,222,000 and $13,295,000, respectively. The Company recognizes contract assets – due from franchisees when the Company has an unconditional right to consideration. As of December 31, 2018 and June 30, 2018, the Company’s contract assets – due from franchisees was approximately $4,988,000 and $7,251,000, respectively. Fresh Healthy Vending LLC Because it was determined the assets of FHV LLC are currently insufficient to satisfy FHV LLC’s obligations to creditors, as of September 28, 2018, FHV LLC has executed an Assignment for the Benefit of Creditors under California law, whereby all of the assets of FHV LLC have been assigned to a third party fiduciary who will expeditiously liquidate such assets and distribute the proceeds thereof to FHV LLC’s creditors pursuant to the priorities established and permitted by law. Consequently, the Company has accounted for FHV LLC as a discontinued operation. 19 Degrees The Company recognizes revenue from the sale of products from company-owned robotic soft serve vending kiosks when products are purchased. During the three and six months ended December 31, 2018 the Company recognized approximately $13,000 and $42,000, respectively. During the three and six months ended December 31, 2017 the Company recognized approximately $34,000 and $96,000, respectively. The Company recognizes the value of company-owned machines as inventory when purchased. Subsequent to installation, the purchased cost is recognized in fixed assets and depreciated over its estimated useful life. As of December 31, 2018, there was one company-owned robotic soft serve vending kiosks included in fixed assets. It is not the Company’s policy to allow for returns, discounts or warranties to our franchisees. Under certain circumstances, including as the result of regulatory action, the Company may become obligated to offer our franchisees amounts in rescission to reacquire their existing franchises, including the robotic soft serve vending kiosks Additionally, if the Company is unable to fulfill its obligations under a franchise agreement the Company may, at its sole discretion, agree to refund or reduce part or all of a franchisees payments or commitments to pay. As of December 31, 2018 and June 30, 2018, the Company’s provision for Reis & Irvy’s franchisee rescissions and refunds totaled approximately $3,985,000 and $1,924,000, respectively. The balance is based on executed termination agreements and an estimate of future terminations. Marketing and advertising Marketing and advertising costs are expensed as incurred. There are no existing arrangements under which the Company provides or receives marketing and advertising services from others for any consideration other than cash. Marketing and advertising expense totaled approximately $488,000 and $1,286,000 for the three and six months ended December 31, 2018, respectively. Marketing and advertising expense totaled approximately $707,000 and $1,454,000 for the three and six months ended December 31, 2017, respectively. Research, development and engineering costs Research, development and engineering costs are expensed as incurred. For the three and six months ended December 31, 2018, the Company recorded approximately $1,225,000 and $2,224,000, respectively. For the three and six months ended December 31, 2017, the Company recorded approximately $1,023,000 and $1,924,000, respectively. Concentration of manufacturers Our robotic soft serve vending kiosks are manufactured by one supplier and we will be transitioning to another single source supplier. This change in suppliers could cause a delay in deliveries and possible loss of sales, which could adversely affect the Company’s operating results. The Company uses a single supplier for its frozen confectionary consumables. Although there are a limited number of product suppliers with the product selection and distribution capabilities required by the franchise network, other manufacturers and distributors could provide similar products on comparable terms. See Note 11 for purchase commitments from our manufacturers for inventory. Discontinued Operations Pursuant to ASC 205-20 Discontinued Operations, in determining whether a group of assets that is disposed (or to be disposed) should be presented as a discontinued operation, we analyze whether the group of assets being disposed represents a component of the Company; that is, whether it had historic operations and cash flows that were clearly distinguished, both operationally and for financial reporting purposes. In addition, we consider whether the disposal represents a strategic shift that has or will have a major effect on our operations and financial results. The results of discontinued operations, as well as any gain or loss on the disposal, if applicable, are aggregated and separately presented in our consolidated statements of operations, net of income taxes. The historical financial position of discontinued operations are aggregated and separately presented in our accompanying condensed consolidated balance sheets. Reclassifications Certain amounts in previously issued financial statements have been reclassified to conform to the presentation following the Assignment for the Benefit of Creditors, which includes the reclassification of the combined financial position and results of operations of FHV LLC as discontinued operations (see Note 12) for all periods presented. Net loss per share The Company calculates basic earnings per share (“EPS”) by dividing our net loss by the weighted average number of common shares outstanding for the period, without considering common stock equivalents. Diluted EPS is computed by dividing net income or net loss and comprehensive net loss applicable to common shareholders by the weighted average number of common shares outstanding for the period and the weighted average number of dilutive common stock equivalents. Common stock equivalents are only included in the calculation of diluted EPS when their effect is dilutive. Segment Information The Company relies upon ASC 280, Segment Reporting, For the periods presented, the Company determined that Reis and Irvy’s, Inc., and FHV, LLC (see Note 12 – Discontinued operations) were reportable operating segments; Generation Next Franchise Brands, Inc., 19 Degrees, Inc., Generation Next Vending Robots, The Fresh and Healthy Vending Corporation, FHV Acquisition, Corp. and FHV Acquisition, Corp. were not material segments and therefore have not been reported as such. Reis & Irvy’s, Inc. represents the sale of frozen yogurt and ice cream robots, franchise fees, royalties (12% of gross revenue) location fees, and product rebates. FHV, LLC represents the sale of fresh and healthy vending machines, franchise fees, royalties and product rebates. Related Party Transactions The Company has been involved in transactions with related parties. A party is considered to be related to the Company if the party directly or indirectly or through one or more intermediaries, controls, is controlled by, or is under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management, and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. A party which can significantly influence the management or operating policies of the transacting parties or if it has an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests is also a related party. Recent accounting standards In July 2015, FASB issued ASU 2015-11, “Inventory (Topic 330) Related to Simplifying the Measurement of Inventory,” which applies to all inventory except that which is measured using last-in, first-out (“LIFO”) or the retail inventory method. Inventory measured using first-in, first-out (“FIFO”) or average cost is within the scope of the new guidance and should be measured at the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable cost of completion, disposal, and transportation. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method. The amendments are effective for public business entities for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. The new guidance is applied prospectively, and earlier application is permitted as of the beginning of an interim or annual reporting period. The Company adopted ASU 2015-11 effective July 1, 2017, which had no material impact on its consolidated financial statements or financial statement disclosures. In January 2017, the Financial Accounting Standards Board (the “FASB”) issued new guidance for goodwill impairment which requires only a single-step quantitative test to identify and measure impairment and record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value. The option to perform a qualitative assessment first for a reporting unit to determine if a quantitative impairment test is necessary does not change under the new guidance. This guidance is effective for the Company beginning in fiscal year 2020 with early adoption permitted. The Company adopted this guidance in fiscal year 2017. The adoption of this guidance will have no impact on the Company’s consolidated financial statements. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash In March 2016, the Financial Accounting Standards Board (the “FASB”) issued new guidance for employee share-based compensation which simplifies several aspects of accounting for share-based payment transactions, including excess tax benefits, forfeiture estimates, statutory tax withholding requirements, and classification in the statements of cash flows. This guidance was effective for the Company in fiscal year 2017. Under the new guidance any future excess tax benefits or deficiencies are recorded to the provision for income taxes in the consolidated statements of operations, instead of additional paid-in capital in the consolidated balance sheets. During the three and six months ended December 31, 2018 and 2017, no excess tax benefits were recorded to additional paid-in capital that would have been recorded as a reduction to the provision for income taxes. In February 2016, the FASB issued ASU No. 2016-02 (“ASU 2016-02”), Leases (Topic 842) Leases (Topic 840) Codification Improvements of Topic 842, Leases Leases (Topic 842 Targeted Improvements.” In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) Revenue Recognition (Topic 605) Step 1: Identify the contract(s) with a customer. Step 2: Identify the performance obligations in the contract. Step 3: Determine the transaction price. Step 4: Allocate the transaction price to the performance obligations in the contract. Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation. This five-step process will require significant management judgment in addition to changing the way many companies recognize revenue in their financial statements. Additionally, and among other provisions, the New Revenue Standard requires expanded quantitative and qualitative disclosures, including disclosure about the nature, amount, timing and uncertainty of revenue. In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date In March 2016, FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The amendments in this update change the accounting for certain stock-based compensation transactions, including the income tax consequences and cash flow classification for applicable transactions. The amendments in this update are effective for annual periods beginning after December 31, 2016 and interim periods within those annual periods. The Company is currently evaluating the impact that this amendment will have on its consolidated financial statements. Effective January 2017, FASB issued ASU No. 2016-15 “Statement of Cash Flows” (Topic 230). This guidance clarifies diversity in practice on where in the Statement of Cash Flows to recognize certain transactions, including the classification of payment of contingent consideration for acquisitions between Financing and Operating activities. We are currently evaluating the impact that this amendment will have on our consolidated financial statements. On January 5, 2017, the FASB issued ASU No. 2017-01, “Clarifying the Definition of a Business” (Topic ASC 805), guidance to clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The amendments in this ASU provide a screen to determine when an integrated set of assets and activities (collectively referred to as a “set”) is not a business. The screen requires that when substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset or a group of similar identifiable assets, the set is not a business. This screen reduces the number of transactions that need to be further evaluated. If the screen is not met, the amendments require that to be considered a business, a set must include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create output and remove the evaluation of whether a market participant could replace the missing elements. This ASU is effective for public business entities in annual periods beginning after December 15, 2017, including interim periods therein. We are currently evaluating the impact that this amendment will have on our consolidated financial statements. In May 2017, the FASB issued ASU No. 2017-09, “Compensation – Stock Compensation” (Topic 718) - Scope of Modification Accounting. This ASU clarifies when to account for a change to the terms or conditions of a share-based payment award as a modification. Under the new guidance, modification accounting is required only if the fair value, the vesting conditions, or the classification of the award (as equity or liability) changes as a result of the change in terms or conditions. This ASU is effective prospectively for the annual period ending December 31, 2018 and interim periods within that annual period. We are currently evaluating the impact that this amendment will have on our consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, “ Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement

Inventory

Inventory	6 Months Ended
	Dec. 31, 2018
Inventory Disclosure [Abstract]
Inventory	3. Inventory Inventory consisted of the following: December 31, 2018 June 30, 2018 Inventory on-hand: Raw material $ 11,613,525 $ 1,800,991 Work in process 557,550 1,003,773 Finished goods 92,925 506,720 12,264,000 3,311,484 Allowance for obsolete inventory (400,000 ) (300,000 ) $ 11,864,000 $ 3,011,484 Prepaid inventory represents payments for raw material that has not been received by the Company. See Note 10 for purchase commitments from our manufacturers for inventory.

Property and equipment

Property and equipment	6 Months Ended
	Dec. 31, 2018
Property, Plant and Equipment [Abstract]
Property and Equipment	4. Property and equipment Property and equipment consisted of the following: December 31, June 30, 2018 2018 (unaudited) (audited) Furniture and fixtures $ 66,749 $ 44,065 Office equipment 32,517 32,517 Tenant improvements 61,414 61,414 Frozen yogurt robots 30,000 177,684 190,680 315,680 Accumulated depreciation (89,924 ) (115,889 ) $ 100,756 $ 199,791 For the three and six months ended December 31, 2018, depreciation expense was $12,000 and $27,000 respectively. For the three and six months ended December 31, 2017, depreciation expense was $11,000 and $21,000 respectively.

Intangible property

Intangible property	6 Months Ended
	Dec. 31, 2018
Goodwill and Intangible Assets Disclosure [Abstract]
Intangible property	5. Intangible property Intangible property consisted of the following: December 31, 2018 June 30, 2018 (unaudited) (audited) Patents $ 2,440,000 $ 2,440,000 Computer software 116,176 116,176 2,556,176 2,556,176 Accumulated amortization (881,492 ) (686,052 ) $ 1,674,684 $ 1,870,124 For the three and six months ended December 31, 2018, amortization expense was $98,000 and $195,000 respectively. For the three and six months ended December 31, 2017, amortization expense was $96,000 and $192,000 respectively. Patents On December 29, 2016, the Company entered into an Asset Purchase Agreement (the “Agreement”) with Robofusion, Inc. (“RFI”), whereby the Company acquired the intellectual property assets of RFI, a developer of robotic-kiosk vending technology, primarily frozen yogurt vending kiosks/cubes, using RFI’s trademarked name of Reis & Irvy’s (the “Acquisition”). Pursuant to the Agreement, the Company provided RFI, and its designees, a cash payment of $440,000, The Company also issued to RFI a three-year, $2 million note and a five-year common stock purchase warrant for 1,520,000 shares with a strike price of $0.50 per share. Furthermore, certain RFI Officers, Directors and Shareholders will be subject to a five-year, non-compete agreement. Also, the Agreement provides for indemnification and set-off of up to $1 million, under certain circumstances. Through the date of this report, the Company entered into four settlements related to the intellectual property totaling approximately $401,000. Furthermore, the Company made approximately $268,000 in payments. All settlement payments are a reduction of the note payable. (See Note 6). RFI previously granted the Company an exclusive license to market RFI’s frozen yogurt vending kiosks/robots, using RFI’s trademarked name of Reis & Irvy’s, in the United States and its territories (excluding Puerto Rico) and Canada. The assets acquired pursuant to the Agreement, are substantially all of the assets previously licensed to the Company. Computer software Computer software represents capitalized costs of the customer relationship management software utilized by the Company.

Notes payable

Notes payable	6 Months Ended
	Dec. 31, 2018
Debt Disclosure [Abstract]
Notes payable	6. Notes payable Senior secured promissory notes On February 25, 2014, we issued Senior Secured Promissory Notes (the “Initial Notes”) to three investors in exchange for cash totaling $501,000. The Initial Notes were set to mature on February 24, 2015 and bear simple interest at a rate of 12% paid monthly over the term of the loan. The Initial Notes also provide that our Company can raise up to $1.5 million in proceeds from the issuance of additional notes (the “Additional Notes”) which would have the same seniority and security rights. The Initial Notes are secured by substantially all assets of the Company. On September 23, 2014, the holders of the Company’s Initial Notes extended the maturity date from February 24, 2015 to March 15, 2016, and on March 15, 2016, the Notes were further extended to September 30, 2016. The notes have been further extended to December 31, 2018 and $478,000 of the notes, plus accrued interest, were converted to common stock at $.16 per share during fiscal 2018. The remaining outstanding notes, aggregating $23,000, were granted conversion rights at $.16 per share and were converted to common stock during the quarter ended September 30, 2018. The conversion right granted was fixed at the closing trading price of the stock. As a result, the Company determined that the conversion right was not a derivative in accordance with ASC 815, Derivatives and Hedges, As of December 31, 2018 and June 30, 2018, the outstanding balance was approximately $0 and $23,000, respectively. Financing and security agreement On September 23, 2014, the Company entered into a Financing and Security Agreement (the “Financing Agreement”) with the following terms: · The Company may borrow up to $1.5 million in tranches of up to $150,000 each. · The first tranche of $150,000 was issued at the closing of the transaction. An additional amount of $100,000 was issued during the quarter ended December 31, 2014. · The notes payable issued under the terms of the Financing Agreement are due in full 24 months from the funding of each tranche. The Company may, at its discretion, extend the due date for each tranche for an additional 12 months. · Interest on the borrowings accrues at a rate of 10% per annum, and is payable quarterly. In the event the Company elects to extend the maturity date of a tranche, the interest rate will increase to 12% per annum on that tranche. · The lender may at its discretion convert any outstanding principal under any of the tranches into shares of the Company’s common stock. The conversion price is 85% of the average closing prices for the 15 trading days prior to the notice of conversion, but in no event at a conversion price lower than $1.28 per share. · On the due date, or the extended due date, the Company may at its discretion convert up to one-half of the outstanding principal into shares of common stock. The conversion price is 85% of the average closing prices for the 15 trading days prior to the due date or extended due date, whichever may be applicable. · Borrowings are secured by the Company-owned micro markets. At December 31, 2018 and June 30, 2018, there was $250,000 outstanding under the Financing Agreement, of which $150,000 originally matured on September 23, 2016 and $100,000 originally matured on December 15, 2016. On January 20, 2017, the Company extended both tranches until December 31, 2018. As part of the extension, the holder was granted conversion rights at $.16 per share. The conversion right granted was fixed at the closing trading price of the stock. As a result, the Company determined that the conversion right was not a derivative in accordance with ASC 815, Derivatives and Hedges, The lender of the Financing Agreement has informed the Company that he does not intend to lend additional amounts under the Financing Agreement. As of December 31, 2018 and June 30, 2018, accrued interest was approximately $94,000 and $81,000, respectively. For the three and six months ended December 31, 2018, interest expense was approximately $12,600 and $6,300, respectively. For the three and six months ended December 31, 2017, interest expense was approximately $6,250 and $12,600, respectively. Convertible promissory note On June 10, 2015, the Company issued a $600,000 convertible promissory note (the “Promissory Note”) with interest payable at 10% per annum. In connection with the issuance of the Promissory Note, the Company also issued 2,000,000 common stock purchase warrants, with a term of four years, at an exercise price of $.75 per share. The Promissory Note matures twelve months from issuance, may be extended for an additional three months, and may be converted at any time in whole or in part, at the lesser of: (i) 25% discount to the next round of financing prior to conversion in excess of $1 million; or (ii) $.30 per share; or, (iii) Commencing six months after issuance date, at the investor’s sole discretion, at a 20% discount to the lowest trading price ten business days prior to conversion. In connection with the issuance of the Promissory Note and warrant, the Company has recorded the fair value of the warrant of $78,707 as additional paid-in capital. Furthermore, the Company has recorded a discount on the Promissory Note of $480,100 and a derivative liability of $401,393 due to the lack of explicit limit on the number of shares that may be required to be issued upon future conversion. The discount is amortized as accretion of discount on notes payable over the term of the loan using the effective interest rate method. There was no derivative gain or loss during the three months ended March 31, 2018. We calculated the value of the discount using a binomial option pricing model employing the following assumptions: volatility of common stock – 76%; risk-free interest rate – 0.28%; forfeiture rate – 0%; value per share of common stock - $0.45; strike price - $0.75; term – 4 years. The Promissory Note maturity may also be extended for an additional three months. Furthermore, there will be a full ratchet, anti-dilution with respect to the shares of common stock only (no adjustments will be made to the warrants), for any equity or Convertible Debt financing completed or a definitive Term Sheet exercised within twelve months of closing or fifteen months if the Company exercises its one-time extension. The ratchet does not come into effect for any non-convertible debt offering arranged by the Company, its advisors or bankers. The conversion terms of the Promissory Note were amended pursuant to a first amendment to Promissory Note, dated October 14, 2015. The adjustable pricing mechanism commencing 6 months after the Promissory Note issuance date at a 20% discount to the lowest trading price 10 business days prior to conversion was removed. The negative covenants set forth in the subscription agreement were also amended pursuant to a first amendment to subscription agreement, dated October 14, 2015. The modification of an embedded conversion feature is separately accounted for as a derivative before the modification, after the modification or both. Since the bifurcated conversion option is accounted for at fair value both before and after the modification, any changes in the fair value of the conversion option would be reflected in earnings. Furthermore, the Promissory Note was extended for an additional six months from the original maturity. On January 20, 2017, the note was extended through June 30, 2017 and the warrant price was reduced to $.30 per share, provided that the warrants must be exercised for cash. Furthermore, the warrant expiration date was amended to June 20, 2018. The modification of the debt terms was not deemed substantive and therefore, was not accounted for as an extinguishment of debt with the recognition of a gain or loss. The principal balance of $600,000 plus accrued interest was repaid during the first quarter of Fiscal year 2018. Robofusion note payable On December 29, 2016, the Company entered into an Asset Purchase Agreement (the “Agreement”) with Robofusion, Inc. (“RFI”), whereby the Company acquired the intellectual property assets of RFI, a developer of robotic-kiosk vending technology, primarily frozen yogurt vending kiosks/robots, using RFI’s trademarked name of Reis & Irvy’s (the “Acquisition”). Pursuant to the Agreement, the Company provided RFI, and its designees, a cash payment of $440,000. The Company also issued to RFI a three-year, $2 million note. In connection with the issuance of the note payable, the Company issued a five-year common stock purchase warrant for 1,520,000 shares with a strike price of $0.50 per share (see Note 5). At inception, the estimated fair value of the warrant was approximately $174,000, and was recognized as a debt discount. During the three and six months ended December 31, 2018 approximately $12,500 and $25,000 was accreted to interest expense in the accompanying statements of operations. During the three and six months ended December 31, 2017 approximately $12,500 and $25,000 was accreted to interest expense in the accompanying statements of operations. As of December 31, 2018 and June 30, 2018, the outstanding balance was approximately $1,197,000 and $1,441,000, respectively. During the six months ended December 31 2018, principal payments were approximately $65,000 and indemnification payments were approximately $179,000. During fiscal 2018, principal payments were approximately $424,000 and indemnification payments were approximately $135,000. As of December 31, 2018 and June 30, 2018, accrued interest was approximately $34,000 and $12,000, respectively. For the six months ended December 31, 2018 and 2017, interest expense was approximately $22,000 and $31,000, respectively. During the quarter ended December 31, 2018, Robofusion exercised 250,000 warrants for a purchase price of $125,000. Bridge notes payable On February 28, 2017, the Company executed two short-term bridge notes aggregating $345,000. The notes bear interest at 0% per annum and matured on July 28, 2017. In connection with the note issuances, the Company recognized an original issue discount of approximately $45,000 and a debt discount approximately $57,000 related to the issuance of 75,000 shares of the Company’s common stock (Note 7), for a total debt discount of approximately $102,000. The debt discount was amortized over the life of the loan. The bridge notes were repaid during the fiscal year ended June 20, 2018. December 31, June 30, 2018 2018 Senior Secured Promissory Notes, bearing interest at 12% per annum, payable monthly. The Senior Secured Notes mature on December 31, 2018 and have conversion rights at $.16 per share. $ - $ 23,000 Convertible secured debt, bearing interest at 10% per annum, payable quarterly. The convertible secured debt matures on December 31, 2018 and has conversion rights at $.16 per share. 250,000 250,000 $2,000,000 Promissory Note, bearing interest at 3.25% per annum. Principal and interest is due quarterly, over a 3 year period, net of discount of $74,568 and $99,426, respectively. 1,122,635 1,342,132 1,372,635 1,615,132 Less current maturities (1,042,139 ) (879,017 ) $ 330,496 $ 736,115 Maturities of notes payable, net of discounts, are as follows: Deember 31, 2019 $ 1,042,139 June 30, 2020 330,496 $ 1,372,635

Stockholders' deficit

Stockholders' deficit	6 Months Ended
	Dec. 31, 2018
Stockholders' Equity Note [Abstract]
Stockholders' deficit	7. Stockholders’ deficit For the six months ended December 31, 2018, the Company issued or recognized: · Approximately 912,000 shares of common stock for gross proceeds of approximately $1,300,000 · Exercise of 250,000 warrants for a purchase price of $125,000 · Approximately $1,474,000 in stock-based compensation related to options issued inside and outside the 2013 Equity Incentive Plan. · Approximately 622,000 shares of common stock for the cashless exercise of options under the 2013 Equity Incentive Plan. (See Note 8).

Stock-based compensation

Stock-based compensation	6 Months Ended
	Dec. 31, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Stock-based compensation	8. Stock-based compensation 2013 Equity Incentive Plan On August 14, 2013, our Board of Directors approved the adoption of the 2013 Equity Incentive Plan (the “2013 Plan”). The 2013 Plan was approved by a majority of our shareholders (as determined by shareholdings) on September 4, 2013. The 2013 Plan provides for granting of stock-based awards including: incentive stock options, non-statutory stock options, stock bonuses and rights to acquire restricted stock. The total number of shares of common stock that may be issued pursuant to stock awards under the 2013 Plan were initially not exceed in the aggregate 2,600,000 shares of the common stock of our Company. On July 13, 2015, the Company increased the total number of shares that may be issued under the 2013 Plan to 4,000,000. Furthermore, in April 2016, the Company further increased the total number of shares that may be issued under the Plan to 6,000,000. During the six months ended December 31, 2018, the Company granted stock options under its 2013 Equity Incentive Plan. Stock-based compensation related to these awards is recognized on a straight-line basis over the applicable vesting period (generally 24 months) and is included in selling, general and administrative expenses in the accompanying condensed consolidated statements of operations for the three and six months ended December 31, 2018 and 2017. The options issued were valued using a binomial method assuming the following: Expected volatility 232.16%-234.30 % Dividend yield 0 % Risk-free interest rate 2.33%-2.44 % Expected life in years 3.5 The expected volatility was estimated based on the volatility of the Company’s stock. The risk-free rate was based on the U.S. Treasury note rate over the expected life of the options. The expected life was determined using the simplified method as we have no historical experience. We recorded stock-based compensation expense of approximately $45,000 and $91,000 during the three and six months ended December 31 and 2018, respectively. We recorded stock-based compensation expense of approximately $144,000 and $280,000 during the three and six months ended December 31 and 2017, respectively. Remaining stock-based compensation to be recognized is approximately $203,000. The following table summarizes the stock option activity under the 2013 Plan through December 31, 2018: Average Weighted Remaining Average Exercise Contractual Aggregate Options Price Per Share Term (Years) Intrinsic Value Outstanding at June 30, 2018 3,141,876 $ 0.21 5.23 $ 6,168,665 Granted - $ - Exercised (449,500 ) $ 0.43 Forfeited (380,750 ) $ - Outstanding at December 31, 2018 2,311,626 $ 0.36 4.79 $ 994,126 Vested options 1,939,126 Remaining options expected to vest 298,000 At December 31, 2018, the outstanding options had an average remaining expected life of 4.79 years. Furthermore, at December 31, 2018, 1,939,126 options were exercisable at a weighted average exercise price of $0.19. Non-Qualified Stock Options On January 20, 2017, the Company granted non-qualified stock options (outside of the 2013 Plan) aggregating 5,000,000 and 500,000, respectively to its Chairman and CEO. The options vest 50% upon the delivery of 400 frozen yogurt robots or achieving cumulative revenue of $15 million and 50% upon the delivery of 800 frozen yogurt robots or achieving cumulative revenue of $30 million. The estimated fair value of the options was approximately $698,000. Stock-based compensation related to these awards is recognized on a straight-line basis over the expected vesting period (24 months) and is included in selling, general and administrative expenses in the accompanying condensed consolidated statements of operations for the three and six months ended December 31, 2018 and 2017. The options issued were valued using a binomial method assuming the following: Expected volatility 134.81 % Dividend yield 0 % Risk-free interest rate 1.50 % Expected life in years 3.5 During the six months ended December 31, 2018, the Company recognized stock-based compensation expense of approximately $140,000. Remaining stock-based compensation to be recognized is approximately $163,000. No options have vested and the options expected to vest is 4,400,000. There were 660,000 non-qualified stock options granted during the six months ended December 31, 2018. These grants were awarded to two independent Board members are vest over a 36 month period. During February 2018, the Company granted nonqualified stock options (outside of the 2013 Plan) to the following: · The Company granted a potential of 1,175,000 options to employees. The options vest based on objective criteria consisting of sales and overall company goals. · Furthermore, we granted a potential of 6,375,000 options to the Chairman, CEO and management employees with an exercise price of $0.87 per share. The options vest 50% upon 1,200 units installed or $45 million in cumulative revenue; and 50% upon 2,000 units installed or $75 million in cumulative revenue. The estimated fair value of the options was approximately $6,464,000. Stock-based compensation related to these awards is recognized on a straight-line basis over the expected vesting period (24 months) and is included in selling, general and administrative expenses in the accompanying condensed consolidated statements of operations. The options issued were valued using a binomial method assuming the following: Expected volatility 232.16% - 233.60 % Dividend yield 0 % Risk-free interest rate 2.37% - 2.39 % Expected life in years 3.5 During the six months ended December 31, 2018, the Company recognized stock based compensation expense of approximately $1,190,000. Remaining stock-based compensation to be recognized is approximately $4,207,000. No options have vested and the remaining options expected to vest is 5,596,000.

Leases

Leases	6 Months Ended
	Dec. 31, 2018
Leases [Abstract]
Leases	9. Leases On August 1, 2015, the Company moved its corporate and warehouse facilities to a single location aggregating 8,654 feet at 2620 Financial Court, Suite 100, San Diego California 92117. The new lease is for a term of 84 months. The current monthly rental payment, net of utilities for the facility, is $15,995. Future minimum lease payments under the Company’s Facility Lease is as follows: 2019: $196,928; 2020: $202,554; 2021: $208,377; 2022: $214,403: Thereafter: $17,909. Rent expense totaled $70,000 and $55,000 for the three months ended December 31, 2018 and 2017, respectively. Rent expense totaled $124,000 and $111,000 for the six months ended December 31, 2018 and 2017, respectively.

Commitments and contingencies

Commitments and contingencies	6 Months Ended
	Dec. 31, 2018
Commitments and Contingencies Disclosure [Abstract]
Commitments and contingencies	10. Commitments and contingencies During fiscal year 2018, the Company began a voluntary internal review into payments made with respect to primary stock sales. The Company has engaged outside counsel, has ceased and will not make further payments with regard to stock sales, will take remedial measures (including oversight and education), and, as deemed appropriate, will take steps to recapture the value of those payments previously made. The Audit Committee will take charge of and oversee the continued internal review and remediation efforts. The Company provides a one-year parts warranty on its robotic soft serve vending kiosks. However, the soft-serve component carries a five-year parts and two-year labor warranty. Our frozen yogurt robots are currently supplied by a single manufacturer; however, the Company has announced an interim agreement with Stoelting Foodservice to assemble kiosks as a complement to its current contract manufacturer. Our frozen yogurt consumables will be supplied by several distributors, based on geographical location. However, there may be only one supplier in each geographic location. A change in suppliers, however, could cause a delay in deliveries and a possible loss of revenue from both current and prospective franchisees, which could adversely affect our operating results. As of December 31, 2018, the Company had unconditional purchase contracts of approximately $4,633,000 for the purchase of inventory for the frozen yogurt and ice cream robots. On May 19, 2018, the Company entered into an 18-month consulting contract with a franchisee. Consideration is a total of 300,000 shares of common stock. 50,000 shares of common stock vest every three months during the term of the contract. If the consultant resigns or is terminated, the Company has the option to repurchase the unreleased shares at the lesser of the fair market value of the shares at the time the repurchase option is exercised and the purchase price The Company accounted for the shares in accordance with ASC 505-50, Equity-Equity Based Payments to Non-Employees On June 6, 2018, the Company entered into an agreement with two investors in connection with the Company’s private placement memorandum. The investors have the right to purchase: · From June 6 through June 30, 2018, 300,000 shares of common stock at $1.00 per share. As of June 30, 2018, the investors purchased 300,000 shares of common stock. · From July 1 through September 30, 2018, 1,000,000 shares of common stock at $1.00 per share. No shares were purchased under this option. · From October 1 through December 31, 2018, 1,333,333 shares of common stock at $1.50 per share. As of December 31, 2018, no shares were purchased. From time to time, we may become involved in litigation and other legal actions, including disagreements with to any pending litigation or franchise agreement rescissions where the amount and range of loss can be estimated. We record our best estimate of a loss when the loss is considered probable. Where a liability is probable and there is a range of estimated loss with no best estimate in the range, we record a charge equal to at least the minimum estimated liability for a loss contingency when both of the following conditions are met: (i) information available prior to issuance of the financial statements indicates that it is probable that an asset had been impaired or a liability had been incurred at the date of the financial statements and (ii) the range of loss can be reasonably estimated. Estimated legal costs expected to be incurred to resolve legal matters are recorded to the consolidated balance sheet and statements of operations. Additionally, our Company may be subject to certain state reviews of our Franchise Disclosure Documents. Such state reviews could lead to our Company being fined or prohibited from entering into franchising agreements with the reviewing state. No such contact has occurred during the six months ended December 31, 2018. Periodically, we are contacted by other state franchise regulatory authorities and in some cases have been required to respond to inquiries, or make changes to our franchise disclosure documents or franchise offer and sale practices. Management believes these communications from state regulators and corresponding changes in our franchise disclosure documents and practices are administrative in nature and do not indicate the presence of a loss or probable potential loss.

Related party transactions

Related party transactions	6 Months Ended
	Dec. 31, 2018
Related Party Transactions [Abstract]
Related party transactions	11. Related party transactions Related party debt consisted of the following: December 31, 2018 June 30, 2018 Secured Promissory Notes $ 296,779 $ 296,779 Convertible Promissory Note - 240,007 296,779 536,786 Less current maturities (296,779 ) (536,786 ) $ - $ - Notes Payable to Socially Responsible Brands On October 27, 2015, the Company obtained secured loans in the aggregate amount of $500,000 from Socially Responsible Brands, Inc. The Company’s Chairman, Nicholas Yates, is a 20% owner of Socially Responsible Brands, Inc. The Company issued two Secured Promissory Notes and a related Security Agreement, each dated October 27, 2015 (the “Notes” and “Security Agreement”). Certain current lien holders of the Company also executed and delivered a Subordination Agreement in connection with the issuance of the Notes and Security Agreement (the “Subordination Agreement”, and together with the Notes and Security Agreement, the “Transaction Documents”). The Notes are each in the principal amount of $250,000, and have terms of eighteen months and one year, respectively. The first Note was secured by the Company’s fifty (50) corporate-owned micro-markets and the Note principal and interest is repaid according to a schedule based on sale of such micro-markets. The second Note is secured by the Company’s franchise royalties and principal and interest is repaid on a schedule based on receipt of combo machine sales, with guaranteed payments of at least $75,000 per quarter during the term of the Note. During the three and six months ended December 31, 2018, the Company paid zero principal and interest, respectively, under the Notes. On January 20, 2017, Socially Responsible Brands agreed to extend the maturity date on their notes until December 31, 2017. In connection with the loan extension, the holder may convert their Notes into shares of the Company’s stock at $.16 per share. Furthermore, on September 18, 2017, the Notes were amended whereby the interest rate was modified to a rate of 20% per annum effective October 1, 2016. Additionally, the Notes were further extended until December 31, 2018 and then again extended until June 30, 2018. Notes Payable to Nick Yates On January 13, 2015, the Company’s Chairman, Nicholas Yates, agreed to loan the Company up to $200,000 (the “Loan”), each incremental borrowing under the Loan to be evidenced by a promissory note. Mr. Yates further agreed to loan the Company up to $550,000. Amounts borrowed under the Loan bear interest at 10% per annum and are due on December 31, 2016. The Loan also provides for conversion to common stock, at the option of the holder, at a price equal to the Company’s next round of funding. In connection with the beneficial conversion option, the Company recorded $300,000 as a discount on the Loan and charged $0 and $0, to operations during the quarters ended September 30, 2018 and 2017, respectively. As of December 31, 2018 and June 30, 2018, $0 and $240,000, respectively were outstanding under the Loan. On January 20, 2017, Mr. Yates agreed to extend his loans until December 31, 2017. In exchange for extending the loans, Mr. Yates was granted an option to convert the loan to common stock at $.16 per share. Furthermore, Loans were extended until December 31, 2018. On October 9, 2018, the Company repaid the outstanding balance of approximately $240,000 of convertible notes payable to the Company’s Chairman, Nicholas Yates, and related accrued interest of approximately $14,000, for a total of approximately $254,000. Other Transactions During fiscal 2018, the Company paid a bonus to the Chairman for shares of the Company’s stock that potential franchisees purchased. In this regard, the Company paid approximately $332,000 to its Chairman for the time-period July 2017 to April 2018. The Chairman voluntarily agreed to repay this bonus after the Audit Committee has concluded its investigation. In July 2017, the Company issued 150,000 shares of common stock in connection with settlement of a former franchisee. Terms of the agreement state that Nick Yates will receive 50% of the proceeds in excess of $200,000. The spouse of the Company’s Chairman was employed by the Company during 2017 and through May 31, 2018. The Company charged approximately $0 and $20,000 to operations for her compensation during the six months ended December 31, 2018 and 2017, respectively. As of December 31, 2018 and June 30, 2018, prepaid expenses and other current assets in the accompanying balance sheet included approximately $10,000 and $28,000, respectively, of short-term advances to an officer of the Company. The Company determined that there may be a material weakness related to the identification of transactions that could be deemed violations of Section 13(k) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Section 402 of the Sarbanes-Oxley Act of 2002.

Discontinued operations

Discontinued operations	6 Months Ended
	Dec. 31, 2018
Discontinued Operations and Disposal Groups [Abstract]
Discontinued operations	12. Discontinued operations Because it was determined the assets of FHV LLC are currently insufficient to satisfy FHV LLC’s obligations to creditors, as of September 28, 2018, FHV LLC has executed an Assignment for the Benefit of Creditors under California law, whereby all of the assets of FHV LLC have been assigned to a third party fiduciary who will expeditiously liquidate such assets and distribute the proceeds thereof to FHV LLC’s creditors pursuant to the priorities established and permitted by law. Discontinued operations as of December 31, 2018 and June 30, 2018 and for the three and six months ended December 31, 2018 and 2017 consist of the operations from the FHV LLC subsidiary. Gain (Loss) from Discontinued Operations For the three months ended December 31, For the six months ended December 31, 2018 2017 2018 2017 Revenues: Vending machine sales, net $ - $ 34,457 $ - $ 93,539 Franchise fees - 1,150 - 7,295 Company owned machine sales - - - - Royalties - 82,132 8,041 155,113 Other - 14,298 2,050 32,838 Total revenue, net - 132,037 10,091 288,784 Cost of revenues - 29,822 5,237 79,380 Gross margin - 102,215 4,854 209,404 Operating expenses: Personnel - 395,777 - 648,541 Marketing - - - - Professional fees - - 26,451 30,713 Insurance - 10,112 - 22,939 Rent - 7,784 6,199 20,101 Depreciation and amortization - 3,338 - 3,770 Stock compensation - 144,239 - 155,953 Provision for legal settlement - 213,621 - 304,280 Other - (8,918 ) 6 86,480 Total operating expenses - 765,953 32,656 1,272,776 Income (loss) from operations - (663,738 ) (27,802 ) (1,063,372 ) Other expenses: Interest expense - (40,985 ) - (121,699 ) Derivative liability income (expense) - - - (220,003 ) Loss before provision for income taxes - (704,723 ) (27,802 ) (1,405,074 ) Provision for income taxes - - - - Loss from operations - (704,723 ) (27,802 ) (1,405,074 ) Gain from disposition of operations 169,304 - Net gain (loss) $ - $ (704,723 ) $ 141,502 $ (1,405,074 ) See accompanying notes to the unaudited condensed consolidated financial statements. The following tables lists the assets of discontinued operations and liabilities of discontinued operations as of September 30, 2018 and June 30, 2018 and the discontinued operations for FHV LLC for the three months ended September 30, 2018 and 2017. Assets and Liabilities of Discontinued Operations June 30, 2018 Current assets: Cash $ 26,417 Restricted cash 1,500 Accounts receivable, net of allowance for doubtful accounts of $174,011 18,451 Inventory on-hand, net of allowance for obsolete inventory of $100,000 246,296 Current assets held for disposition $ 292,664 Current liabilities: Accounts payable and accrued liabilities $ 280,159 Contract liabilities - customer advances and deferred revenues 515,517 Provision for franchisee rescissions and refunds 496,000 Total current liabilities $ 1,291,676

Subsequent events

Subsequent events	6 Months Ended
	Dec. 31, 2018
Subsequent Events [Abstract]
Subsequent events	13. Subsequent events On various dates subsequent to December 31, 2018 and through the date of this report, the Company entered into termination agreements with franchisees for refunds aggregating approximately $140,000. The Company considered the guidance in ASC 855, Subsequent Events

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	6 Months Ended
	Dec. 31, 2018
Summary of significant accounting policies
Basis of accounting	Basis of accounting The included (a) condensed consolidated balance sheet as of June 30, 2018, which has been derived from audited consolidated financial statements and (b) the unaudited condensed consolidated statements as of December 31, 2018 and for the three and six months ended December 31, 2018 and 2017, have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the rules and regulations of the Securities and Exchange Commission (“SEC”) for reporting on Form 10-Q. Accordingly, these unaudited condensed consolidated statements do not include all of the information and disclosures required by GAAP or SEC rules and regulations for complete consolidated financial statements. In the opinion of management, these unaudited condensed consolidated financial statements reflect all adjustments (consisting solely of normal recurring nature) considered necessary for a fair presentation of the results for the interim periods presented. The results of operations for any interim period are not necessarily indicative of results for the full year. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s filings with the SEC, including its most recent annual report on Form 10-K for the fiscal year ended June 30, 2018 filed on October 19, 2018.
Liquidity and capital resources	Liquidity and capital resources For the six months ended December 31, 2018 we had a net loss totaling approximately $9,755,000 with negative cash flows from operations totaling approximately $9,903,000. Our cash balance at December 31, 2018 was approximately $409,000. First, our production and installation of kiosks have been slower than anticipated, due to delays caused by engineering and manufacturing deficiencies, which have since been corrected. The impacts of production delays were decreased revenue recognition and less accounts receivable collections. Second, franchise sales during the quarter were lower than anticipated due to a late 10-k filing, which inhibited the Company’s ability to receive approved franchise documents. Also, we used cash on hand to retire liabilities associated with the franchise rescissions, for research, development and engineering expenditures related to our robotic soft serve vending kiosks and for the purchase of robot inventory. The combined result of these events was a substantial decrease in our cash balances and an increase in our outstanding liabilities. In order to ensure sufficient liquidity for our continuing operations, the Company is actively pursuing additional capital in the form of either debt or equity financing (or a combination thereof). We anticipate generating a portion of our required capital resources from deposits on sales of new franchises, unit sales of kiosks for the Fund, royalties from existing and future franchise installs and revenue from corporate-owned kiosks. Management believes the additional funding required can be obtained on terms acceptable to the Company, although there can be no assurance that we will be successful. Our current plans include research and development expenditures for the production of the next generation robot, payments required for the purchase of the Robofusion intellectual property (previous owner of the frozen yogurt robot intellectual property), capital expenditures for the purchase of franchisee and corporate-owned and operated robotic soft serve vending kiosks, as well as the repurchase of machines from franchisees opting to rescind their franchise agreements. The Company estimates current inventory balances of components are sufficient to manufacture approximately 150 – 200 fully-assembled robots. Given our current cash position, we may be forced to curtail our plans by delaying or suspending the production and purchase of robotic soft serve vending kiosks until such time that we may able to prepay for future robots.
Principles of consolidation	Principles of consolidation The condensed consolidated financial statements include the accounts of the Company, and its wholly-owned subsidiaries, Reis & Irvy’s, Inc., FHV LLC (recorded as discontinued operations), 19 Degrees, Inc., Generation Next Vending Robots, The Fresh and Healthy Vending Corporation, and FHV Acquisition, Corp. All significant intercompany accounts and transactions are eliminated.
Use of estimates	Use of estimates The preparation of our Company’s financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of our financial statements and the reported amounts of revenues, costs and expenses during the reporting period. Actual results could differ significantly from those estimates. Significant estimates include our provisions for bad debts, franchisee rescissions and refunds, legal estimates, stock-based compensation, derivative liability and the valuation allowance on deferred income tax assets. It is at least reasonably possible that a change in the estimates will occur in the near term.
Cash and cash equivalents	Cash and cash equivalents All investments with an original maturity of three months or less are considered to be cash equivalents. Cash equivalents primarily represent funds invested in money market funds, bank certificates of deposit and U.S. government debt securities whose cost equals fair market value. We had no cash equivalents at December 31. 2018 and June 30, 2018. We may maintain our cash and cash equivalents in amounts that may, at times, exceed federally insured limits. At December 31, 2018, bank balances, per our bank, exceeding federally insured limits totaled approximately $149,000. We have not experienced any losses with respect to cash, and we believe our Company is not exposed to any significant credit risk with respect to our cash. Certain states require the Company to maintain customer deposits in escrow accounts until the Company has substantially performed its obligations. Furthermore, certain franchisees have elected to pay their remaining balance due directly to an escrow account for the beneficiary of the Company’s contract manufacturer and inventory suppliers. At December 31, 2018 and June 30, 2018, the Company had approximately $4,582,000 and $3,710,000, respectively maintained in escrow accounts for these purposes.
Contract assets - due from franchisees, net	Contract assets – due from franchisees, net Contract assets – due from franchisees arise primarily from kiosk sales and are carried at their estimated collectible amounts, net of any estimated allowances for doubtful accounts. We grant unsecured credit to our customers deemed credit worthy. Ongoing credit evaluations are performed and potential credit losses estimated by management are charged to operations on a regular basis. At the time any particular account receivable is deemed uncollectible, the balance is charged to the allowance for doubtful accounts. Our allowance for doubtful accounts aggregated approximately $174,000 and $0 at December 31, 2018 and June 30, 2018, respectively.
Inventory	Inventory Inventory is carried at the lower of cost or market, with cost determined using the average cost method.
Property and equipment	Property and equipment Property and equipment are carried at cost and depreciated using the straight-line method over their estimated useful lives of the individual assets, generally five to seven years. Leasehold improvements are amortized over the lesser of the term of the related lease or the estimated useful life of the asset. Costs incurred for maintenance and repairs are expensed as incurred and expenditures for major replacements and improvements are capitalized and depreciated over their estimated remaining useful lives.
Intangible assets	Intangible assets Intangible assets consist primarily of patents, trademarks and trade names. Amortization of intangible assets is recorded as amortization expense in the consolidated statements of operations and amortized over the respective useful lives using the straight-line method.
Impairment of long-lived assets	Impairment of long-lived assets Impairment losses are recognized on long-lived assets used in operations when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than the assets’ carrying amount. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amounts of the assets exceed the estimated fair value of the assets. There were no impairments of long-lived assets for the periods ended December 31, 2018 and June 30, 2018, respectively.
Deferred rent	Deferred rent The Company entered into an operating lease for our corporate offices in San Diego, California that contains provisions for future rent increases, leasehold improvement allowances and rent abatements. We record monthly rent expense equal to the total of the payments due over the lease term, divided by the number of months of the lease term. The difference between the rent expense recorded and the amount paid is credited or charged to deferred rent, which is reflected as a separate line item in the accompanying consolidated balance sheet.
Revenue, contract liabilities - franchisees advances and deferred revenue, and contract assets - due from franchisees	Revenue, contract liabilities – franchisees advances and deferred revenue, and contract assets – due from franchisees The Company relies upon ASC 606, Revenue from Contracts with Customers Reis & Irvy’s, Inc The primary revenue sources consisted of the following: · Robotic soft serve vending kiosks · Franchise fees · Royalties Revenues from robotic soft serve vending kiosks and franchise fees are recognized when the Company has substantially performed or satisfied all material services or conditions relating to the franchise agreement. Substantial performance has occurred when: 1) no remaining obligations are unfulfilled under the franchise agreement; 2) there is no intent to refund any cash received or to forgive any unpaid amounts due from franchisees; 3) all of the initial services in the franchise agreement have been performed; and 4) all other material conditions or obligations have been met. During the three and six months ended December 31, 2018, 120 and 50 robotic soft serve vending kiosks were installed and operational, respectively, and the Company had no further material conditions or obligations. There were no vending kiosks operational during the same periods in the prior year. During the three and six months ended December 31, 2018 the Company recognized revenue of approximately $1,688,000 and $4,407,00, respectively for robotic soft serve vending kiosks and approximately $1,500 and $11,000, respectively in franchise fees. Upon the execution of a franchise agreement, a deposit from the franchisee is required, and generally consists of 40% - 50% of the sales price of the frozen yogurt and ice cream robots, 50% - 100% of the initial franchise fees, and 40% - 50% of location fees. In accordance with ASC 606, the Company recognizes the contract as a contract liability – customer deposits and deferred revenue when the Company receives consideration or is due consideration. As of December 31, 2018 and June 30, 2018, the Company’s customer advances and deferred revenues were approximately $35,519,000 and $37,222,000, respectively. These amounts are net of certain off-set adjustments of $13,222,000 and $13,295,000, respectively. The Company recognizes contract assets – due from franchisees when the Company has an unconditional right to consideration. As of December 31, 2018 and June 30, 2018, the Company’s contract assets – due from franchisees was approximately $4,988,000 and $7,251,000, respectively. Fresh Healthy Vending LLC Because it was determined the assets of FHV LLC are currently insufficient to satisfy FHV LLC’s obligations to creditors, as of September 28, 2018, FHV LLC has executed an Assignment for the Benefit of Creditors under California law, whereby all of the assets of FHV LLC have been assigned to a third party fiduciary who will expeditiously liquidate such assets and distribute the proceeds thereof to FHV LLC’s creditors pursuant to the priorities established and permitted by law. Consequently, the Company has accounted for FHV LLC as a discontinued operation. 19 Degrees The Company recognizes revenue from the sale of products from company-owned robotic soft serve vending kiosks when products are purchased. During the three and six months ended December 31, 2018 the Company recognized approximately $13,000 and $42,000, respectively. During the three and six months ended December 31, 2017 the Company recognized approximately $34,000 and $96,000, respectively. The Company recognizes the value of company-owned machines as inventory when purchased. Subsequent to installation, the purchased cost is recognized in fixed assets and depreciated over its estimated useful life. As of December 31, 2018, there was one company-owned robotic soft serve vending kiosks included in fixed assets. It is not the Company’s policy to allow for returns, discounts or warranties to our franchisees. Under certain circumstances, including as the result of regulatory action, the Company may become obligated to offer our franchisees amounts in rescission to reacquire their existing franchises, including the robotic soft serve vending kiosks Additionally, if the Company is unable to fulfill its obligations under a franchise agreement the Company may, at its sole discretion, agree to refund or reduce part or all of a franchisees payments or commitments to pay. As of December 31, 2018 and June 30, 2018, the Company’s provision for Reis & Irvy’s franchisee rescissions and refunds totaled approximately $3,985,000 and $1,924,000, respectively. The balance is based on executed termination agreements and an estimate of future terminations.
Marketing and advertising	Marketing and advertising Marketing and advertising costs are expensed as incurred. There are no existing arrangements under which the Company provides or receives marketing and advertising services from others for any consideration other than cash. Marketing and advertising expense totaled approximately $488,000 and $1,286,000 for the three and six months ended December 31, 2018, respectively. Marketing and advertising expense totaled approximately $707,000 and $1,454,000 for the three and six months ended December 31, 2017, respectively.
Research, development and engineering costs	Research, development and engineering costs Research, development and engineering costs are expensed as incurred. For the three and six months ended December 31, 2018, the Company recorded approximately $1,225,000 and $2,224,000, respectively. For the three and six months ended December 31, 2017, the Company recorded approximately $1,023,000 and $1,924,000, respectively.
Concentration of manufacturers	Concentration of manufacturers Our robotic soft serve vending kiosks are manufactured by one supplier and we will be transitioning to another single source supplier. This change in suppliers could cause a delay in deliveries and possible loss of sales, which could adversely affect the Company’s operating results. The Company uses a single supplier for its frozen confectionary consumables. Although there are a limited number of product suppliers with the product selection and distribution capabilities required by the franchise network, other manufacturers and distributors could provide similar products on comparable terms. See Note 11 for purchase commitments from our manufacturers for inventory.
Discontinued Operations	Discontinued Operations Pursuant to ASC 205-20 Discontinued Operations, in determining whether a group of assets that is disposed (or to be disposed) should be presented as a discontinued operation, we analyze whether the group of assets being disposed represents a component of the Company; that is, whether it had historic operations and cash flows that were clearly distinguished, both operationally and for financial reporting purposes. In addition, we consider whether the disposal represents a strategic shift that has or will have a major effect on our operations and financial results. The results of discontinued operations, as well as any gain or loss on the disposal, if applicable, are aggregated and separately presented in our consolidated statements of operations, net of income taxes. The historical financial position of discontinued operations are aggregated and separately presented in our accompanying condensed consolidated balance sheets.
Reclassifications	Reclassifications Certain amounts in previously issued financial statements have been reclassified to conform to the presentation following the Assignment for the Benefit of Creditors, which includes the reclassification of the combined financial position and results of operations of FHV LLC as discontinued operations (see Note 12) for all periods presented.
Net loss per share	Net loss per share The Company calculates basic earnings per share (“EPS”) by dividing our net loss by the weighted average number of common shares outstanding for the period, without considering common stock equivalents. Diluted EPS is computed by dividing net income or net loss and comprehensive net loss applicable to common shareholders by the weighted average number of common shares outstanding for the period and the weighted average number of dilutive common stock equivalents. Common stock equivalents are only included in the calculation of diluted EPS when their effect is dilutive.
Segment Information	Segment Information The Company relies upon ASC 280, Segment Reporting, For the periods presented, the Company determined that Reis and Irvy’s, Inc., and FHV, LLC (see Note 12 – Discontinued operations) were reportable operating segments; Generation Next Franchise Brands, Inc., 19 Degrees, Inc., Generation Next Vending Robots, The Fresh and Healthy Vending Corporation, FHV Acquisition, Corp. and FHV Acquisition, Corp. were not material segments and therefore have not been reported as such. Reis & Irvy’s, Inc. represents the sale of frozen yogurt and ice cream robots, franchise fees, royalties (12% of gross revenue) location fees, and product rebates. FHV, LLC represents the sale of fresh and healthy vending machines, franchise fees, royalties and product rebates.
Related Party Transactions	Related Party Transactions The Company has been involved in transactions with related parties. A party is considered to be related to the Company if the party directly or indirectly or through one or more intermediaries, controls, is controlled by, or is under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management, and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. A party which can significantly influence the management or operating policies of the transacting parties or if it has an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests is also a related party.
Recent accounting standards	Recent accounting standards In July 2015, FASB issued ASU 2015-11, “Inventory (Topic 330) Related to Simplifying the Measurement of Inventory,” which applies to all inventory except that which is measured using last-in, first-out (“LIFO”) or the retail inventory method. Inventory measured using first-in, first-out (“FIFO”) or average cost is within the scope of the new guidance and should be measured at the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable cost of completion, disposal, and transportation. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method. The amendments are effective for public business entities for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. The new guidance is applied prospectively, and earlier application is permitted as of the beginning of an interim or annual reporting period. The Company adopted ASU 2015-11 effective July 1, 2017, which had no material impact on its consolidated financial statements or financial statement disclosures. In January 2017, the Financial Accounting Standards Board (the “FASB”) issued new guidance for goodwill impairment which requires only a single-step quantitative test to identify and measure impairment and record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value. The option to perform a qualitative assessment first for a reporting unit to determine if a quantitative impairment test is necessary does not change under the new guidance. This guidance is effective for the Company beginning in fiscal year 2020 with early adoption permitted. The Company adopted this guidance in fiscal year 2017. The adoption of this guidance will have no impact on the Company’s consolidated financial statements. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash In March 2016, the Financial Accounting Standards Board (the “FASB”) issued new guidance for employee share-based compensation which simplifies several aspects of accounting for share-based payment transactions, including excess tax benefits, forfeiture estimates, statutory tax withholding requirements, and classification in the statements of cash flows. This guidance was effective for the Company in fiscal year 2017. Under the new guidance any future excess tax benefits or deficiencies are recorded to the provision for income taxes in the consolidated statements of operations, instead of additional paid-in capital in the consolidated balance sheets. During the three and six months ended December 31, 2018 and 2017, no excess tax benefits were recorded to additional paid-in capital that would have been recorded as a reduction to the provision for income taxes. In February 2016, the FASB issued ASU No. 2016-02 (“ASU 2016-02”), Leases (Topic 842) Leases (Topic 840) Codification Improvements of Topic 842, Leases Leases (Topic 842 Targeted Improvements.” In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) Revenue Recognition (Topic 605) Step 1: Identify the contract(s) with a customer. Step 2: Identify the performance obligations in the contract. Step 3: Determine the transaction price. Step 4: Allocate the transaction price to the performance obligations in the contract. Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation. This five-step process will require significant management judgment in addition to changing the way many companies recognize revenue in their financial statements. Additionally, and among other provisions, the New Revenue Standard requires expanded quantitative and qualitative disclosures, including disclosure about the nature, amount, timing and uncertainty of revenue. In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date In March 2016, FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The amendments in this update change the accounting for certain stock-based compensation transactions, including the income tax consequences and cash flow classification for applicable transactions. The amendments in this update are effective for annual periods beginning after December 31, 2016 and interim periods within those annual periods. The Company is currently evaluating the impact that this amendment will have on its consolidated financial statements. Effective January 2017, FASB issued ASU No. 2016-15 “Statement of Cash Flows” (Topic 230). This guidance clarifies diversity in practice on where in the Statement of Cash Flows to recognize certain transactions, including the classification of payment of contingent consideration for acquisitions between Financing and Operating activities. We are currently evaluating the impact that this amendment will have on our consolidated financial statements. On January 5, 2017, the FASB issued ASU No. 2017-01, “Clarifying the Definition of a Business” (Topic ASC 805), guidance to clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The amendments in this ASU provide a screen to determine when an integrated set of assets and activities (collectively referred to as a “set”) is not a business. The screen requires that when substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset or a group of similar identifiable assets, the set is not a business. This screen reduces the number of transactions that need to be further evaluated. If the screen is not met, the amendments require that to be considered a business, a set must include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create output and remove the evaluation of whether a market participant could replace the missing elements. This ASU is effective for public business entities in annual periods beginning after December 15, 2017, including interim periods therein. We are currently evaluating the impact that this amendment will have on our consolidated financial statements. In May 2017, the FASB issued ASU No. 2017-09, “Compensation – Stock Compensation” (Topic 718) - Scope of Modification Accounting. This ASU clarifies when to account for a change to the terms or conditions of a share-based payment award as a modification. Under the new guidance, modification accounting is required only if the fair value, the vesting conditions, or the classification of the award (as equity or liability) changes as a result of the change in terms or conditions. This ASU is effective prospectively for the annual period ending December 31, 2018 and interim periods within that annual period. We are currently evaluating the impact that this amendment will have on our consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, “ Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement

Inventory (Tables)

Inventory (Tables)	6 Months Ended
	Dec. 31, 2018
Inventory Disclosure [Abstract]
Schedule of inventory	December 31, 2018 June 30, 2018 Inventory on-hand: Raw material $ 11,613,525 $ 1,800,991 Work in process 557,550 1,003,773 Finished goods 92,925 506,720 12,264,000 3,311,484 Allowance for obsolete inventory (400,000 ) (300,000 ) $ 11,864,000 $ 3,011,484

Property and equipment (Tables)

Property and equipment (Tables)	6 Months Ended
	Dec. 31, 2018
Property, Plant and Equipment [Abstract]
Schedule of property, plant and equipment	December 31, June 30, 2018 2018 (unaudited) (audited) Furniture and fixtures $ 66,749 $ 44,065 Office equipment 32,517 32,517 Tenant improvements 61,414 61,414 Frozen yogurt robots 30,000 177,684 190,680 315,680 Accumulated depreciation (89,924 ) (115,889 ) $ 100,756 $ 199,791

Intangible property (Tables)

Intangible property (Tables)	6 Months Ended
	Dec. 31, 2018
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of intangible property	December 31, 2018 June 30, 2018 (unaudited) (audited) Patents $ 2,440,000 $ 2,440,000 Computer software 116,176 116,176 2,556,176 2,556,176 Accumulated amortization (881,492 ) (686,052 ) $ 1,674,684 $ 1,870,124

Notes payable (Tables)

Notes payable (Tables)	6 Months Ended
	Dec. 31, 2018
Debt Disclosure [Abstract]
Schedule of notes payable	December 31, June 30, 2018 2018 Senior Secured Promissory Notes, bearing interest at 12% per annum, payable monthly. The Senior Secured Notes mature on December 31, 2018 and have conversion rights at $.16 per share. $ - $ 23,000 Convertible secured debt, bearing interest at 10% per annum, payable quarterly. The convertible secured debt matures on December 31, 2018 and has conversion rights at $.16 per share. 250,000 250,000 $2,000,000 Promissory Note, bearing interest at 3.25% per annum. Principal and interest is due quarterly, over a 3 year period, net of discount of $74,568 and $99,426, respectively. 1,122,635 1,342,132 1,372,635 1,615,132 Less current maturities (1,042,139 ) (879,017 ) $ 330,496 $ 736,115
Schedule of Maturities of Long-term Debt [Table Text Block]	Deember 31, 2019 $ 1,042,139 June 30, 2020 330,496 $ 1,372,635

Stock-based compensation (Table

Stock-based compensation (Tables)	6 Months Ended
	Dec. 31, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Schedule of valuation assumptions for stock options issued	Expected volatility 232.16%-234.30 % Dividend yield 0 % Risk-free interest rate 2.33%-2.44 % Expected life in years 3.5
Schedule of summary of stock option activity	Average Weighted Remaining Average Exercise Contractual Aggregate Options Price Per Share Term (Years) Intrinsic Value Outstanding at June 30, 2018 3,141,876 $ 0.21 5.23 $ 6,168,665 Granted - $ - Exercised (449,500 ) $ 0.43 Forfeited (380,750 ) $ - Outstanding at December 31, 2018 2,311,626 $ 0.36 4.79 $ 994,126 Vested options 1,939,126 Remaining options expected to vest 298,000
Schedule of non-qualified stock options	Expected volatility 134.81 % Dividend yield 0 % Risk-free interest rate 1.50 % Expected life in years 3.5 Expected volatility 232.16% - 233.60 % Dividend yield 0 % Risk-free interest rate 2.37% - 2.39 % Expected life in years 3.5

Related party transactions (Tab

Related party transactions (Tables)	6 Months Ended
	Dec. 31, 2018
Related Party Transactions [Abstract]
Schedule of related party transactions	December 31, 2018 June 30, 2018 Secured Promissory Notes $ 296,779 $ 296,779 Convertible Promissory Note - 240,007 296,779 536,786 Less current maturities (296,779 ) (536,786 ) $ - $ -

Discontinued operations (Tables

Discontinued operations (Tables)	6 Months Ended
	Dec. 31, 2018
Discontinued Operations and Disposal Groups [Abstract]
Schedule of discontinued operations from the FHV LLC subsidiary	Gain (Loss) from Discontinued Operations For the three months ended December 31, For the six months ended December 31, 2018 2017 2018 2017 Revenues: Vending machine sales, net $ - $ 34,457 $ - $ 93,539 Franchise fees - 1,150 - 7,295 Company owned machine sales - - - - Royalties - 82,132 8,041 155,113 Other - 14,298 2,050 32,838 Total revenue, net - 132,037 10,091 288,784 Cost of revenues - 29,822 5,237 79,380 Gross margin - 102,215 4,854 209,404 Operating expenses: Personnel - 395,777 - 648,541 Marketing - - - - Professional fees - - 26,451 30,713 Insurance - 10,112 - 22,939 Rent - 7,784 6,199 20,101 Depreciation and amortization - 3,338 - 3,770 Stock compensation - 144,239 - 155,953 Provision for legal settlement - 213,621 - 304,280 Other - (8,918 ) 6 86,480 Total operating expenses - 765,953 32,656 1,272,776 Income (loss) from operations - (663,738 ) (27,802 ) (1,063,372 ) Other expenses: Interest expense - (40,985 ) - (121,699 ) Derivative liability income (expense) - - - (220,003 ) Loss before provision for income taxes - (704,723 ) (27,802 ) (1,405,074 ) Provision for income taxes - - - - Loss from operations - (704,723 ) (27,802 ) (1,405,074 ) Gain from disposition of operations 169,304 - Net gain (loss) $ - $ (704,723 ) $ 141,502 $ (1,405,074 )
Schedule of assets of discontinued operations and liabilities of discontinued operations for FHV LLC	Assets and Liabilities of Discontinued Operations June 30, 2018 Current assets: Cash $ 26,417 Restricted cash 1,500 Accounts receivable, net of allowance for doubtful accounts of $174,011 18,451 Inventory on-hand, net of allowance for obsolete inventory of $100,000 246,296 Current assets held for disposition $ 292,664 Current liabilities: Accounts payable and accrued liabilities $ 280,159 Contract liabilities - customer advances and deferred revenues 515,517 Provision for franchisee rescissions and refunds 496,000 Total current liabilities $ 1,291,676

Organization and description _2

Organization and description of business (Detail Textuals)	3 Months Ended		6 Months Ended		12 Months Ended
	Dec. 31, 2018USD ($)	Dec. 31, 2017USD ($)	Dec. 31, 2018USD ($)unitRobotMachine	Dec. 31, 2017USD ($)	Jun. 30, 2018USD ($)
Organization And Description Of Business [Line Items]
Research, development and engineering expenses	$ 1,224,701	$ 1,023,223	$ 2,223,706	$ 1,924,630
U.S. states and Canada
Organization And Description Of Business [Line Items]
Number of units for franchise contract | unit			1,290
Contract liabilities - franchise advances and deferred revenues	$ 55,000,000		$ 55,000,000
Offset aggregate adjustment			$ 13,200,000
Additional number of robots for contractual commitments | Robot			2,666
Franchise fee per machine			$ 103,000,000
Number of delivered and installed frozen yogurt vending machines | Machine			188
Research, development and engineering expenses			$ 2,200,000		$ 5,200,000

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Detail Textuals)	3 Months Ended		6 Months Ended
	Dec. 31, 2018USD ($)Machine	Dec. 31, 2017USD ($)	Dec. 31, 2018USD ($)Machine	Dec. 31, 2017USD ($)	Jun. 30, 2018USD ($)
Summary Of Significant Accounting Policies [Line Items]
Net loss	$ (4,747,872)	$ (3,787,568)	$ (9,755,366)	$ (7,774,884)
Cash flows from operations			(10,005,734)	(1,741,202)
Cash	408,745		408,745		$ 10,017,667
Provision for franchisee rescissions and refunds	3,985,132		3,985,132		1,924,121
Bank balances exceeding federally insured limits totaled	149,000		149,000
Cash in escrow	4,582,000		4,582,000		3,710,000
Allowance for doubtful accounts	174,000		174,000		0
Contract assets - due from franchisees	4,988,000		4,988,000		7,251,000
Revenues	4,514,461	35,596	6,272,455	97,427
Recognized revenue	1,688,000		440,700
Customer advances and deferred revenues	35,518,951		35,518,951		37,221,943
Amounts of net of certain off-set adjustments	13,222,000		13,222,000		13,295,000
Marketing and advertising expense	488,000	707,000	1,286,000	1,454,000
Research, development and engineering costs	1,023,000	1,225,000	$ 1,924,000	2,224,000
Reis and Irvy Inc
Summary Of Significant Accounting Policies [Line Items]
Percentage of sale of frozen yogurt and ice cream robots, franchise fees, royalties			12.00%
Franchise fees
Summary Of Significant Accounting Policies [Line Items]
Revenues	10,927		$ 12,511
Franchise fees | Reis and Irvy Inc
Summary Of Significant Accounting Policies [Line Items]
Provision for franchisee rescissions and refunds	3,985,000		3,985,000		$ 1,924,000
Revenues	$ 1,500		$ 11,000
Robotic soft serve vending kiosks | Reis and Irvy Inc
Summary Of Significant Accounting Policies [Line Items]
Number of vending machines installed | Machine	120		120
Number of vending machines operational | Machine	50		50
Robotic soft serve vending kiosks | 19 Degrees, Inc
Summary Of Significant Accounting Policies [Line Items]
Revenues	$ 13,000	34,000	$ 42,000	96,000
Vending machine sales, net
Summary Of Significant Accounting Policies [Line Items]
Revenues	$ 4,407,121	$ 323	$ 6,094,621	$ 427
Minimum | Frozen Yogurt Franchise contracts
Summary Of Significant Accounting Policies [Line Items]
Percentage of machines for cash consideration			40.00%
Percentage of franchise fees for cash consideration			50.00%
Percentage of location fees for cash consideration			40.00%
Maximum | Frozen Yogurt Franchise contracts
Summary Of Significant Accounting Policies [Line Items]
Percentage of machines for cash consideration			50.00%
Percentage of franchise fees for cash consideration			100.00%
Percentage of location fees for cash consideration			50.00%

Inventory (Details)

Inventory (Details) - USD ($)	Dec. 31, 2018	Jun. 30, 2018
Inventory on-hand:
Raw material	$ 11,613,525	$ 1,800,991
Work in process	557,550	1,003,773
Finished goods	92,925	506,720
Inventory gross	12,264,000	3,311,484
Allowance for obsolete inventory	(400,000)	(300,000)
Inventories, net	$ 11,864,000	$ 3,011,484

Property and equipment (Details

Property and equipment (Details) - USD ($)	Dec. 31, 2018	Jun. 30, 2018
Property, Plant and Equipment [Line Items]
Property and equipment gross	$ 190,680	$ 315,680
Accumulated depreciation	(89,924)	(115,889)
Property and Equipment net	100,756	199,791
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Property and equipment gross	66,749	44,065
Office equipment
Property, Plant and Equipment [Line Items]
Property and equipment gross	32,517	32,517
Tenant improvements
Property, Plant and Equipment [Line Items]
Property and equipment gross	61,414	61,414
Frozen yogurt robots
Property, Plant and Equipment [Line Items]
Property and equipment gross	$ 30,000	$ 177,684

Property and equipment (Detail

Property and equipment (Detail Textuals) - USD ($)	3 Months Ended		6 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 12,000	$ 11,000	$ 27,000	$ 21,000

Intangible property (Details)

Intangible property (Details) - USD ($)	Dec. 31, 2018	Jun. 30, 2018
Finite-Lived Intangible Assets [Line Items]
Intangible property gross	$ 2,556,176	$ 2,556,176
Accumulated amortization	(881,492)	(686,052)
Intangible property net	1,674,684	1,870,124
Patents
Finite-Lived Intangible Assets [Line Items]
Intangible property gross	2,440,000	2,440,000
Computer software
Finite-Lived Intangible Assets [Line Items]
Intangible property gross	$ 116,176	$ 116,176

Intangible property (Detail Tex

Intangible property (Detail Textuals)	1 Months Ended	3 Months Ended		6 Months Ended
	Dec. 29, 2016USD ($)Settlement$ / sharesshares	Dec. 31, 2018USD ($)	Dec. 31, 2017USD ($)	Dec. 31, 2018USD ($)	Dec. 31, 2017USD ($)
Finite-Lived Intangible Assets [Line Items]
Amortization expense		$ 98,000	$ 96,000	$ 195,000	$ 192,000
Cash payment to related party	$ 440,000
Patents | Asset Purchase Agreement (the "Agreement") | Reis and Irvy Inc
Finite-Lived Intangible Assets [Line Items]
Cash payment to related party	$ 440,000
Notes issued period	3 years
Notes issued	$ 2,000,000
Common stock purchase warrant year	5 years
Number of common stock called by warrants | shares	1,520,000
Strike price | $ / shares	$ 0.50
Assets Indemnification and set off	$ 1,000,000
Number of settlements | Settlement	4
Settlements related to intellectual property	$ 401,000
Payment made for settlements related to intellectual property	$ 268,000

Notes payable (Details)

Notes payable (Details) - USD ($)	Dec. 31, 2018	Jun. 30, 2018
Debt Instrument [Line Items]
Notes payable	$ 1,372,635	$ 1,615,132
Less current maturities	(1,042,139)	(879,017)
Notes payable, excluding current maturities	330,496	736,115
Senior Secured Promissory Notes
Debt Instrument [Line Items]
Notes payable	0	23,000
Convertible Secured Debt
Debt Instrument [Line Items]
Notes payable	250,000	250,000
Promissory Note
Debt Instrument [Line Items]
Notes payable	$ 1,122,635	$ 1,342,132

Notes payable (Details) (Parent

Notes payable (Details) (Parentheticals) - USD ($)	Mar. 15, 2016	Sep. 23, 2014	Feb. 25, 2014	Dec. 31, 2018	Dec. 31, 2018	Jun. 30, 2018	Jan. 20, 2017
Senior Secured Promissory Notes
Debt Instrument [Line Items]
Modified interest rate on notes payable			12.00%	12.00%	12.00%
Period of debt repayment				Monthly
Maturity date of notes payable	Sep. 30, 2016	Mar. 15, 2016	Feb. 24, 2015	Dec. 31, 2018
Debt conversion per share				$ 0.16	$ 0.16		$ 0.16
Convertible Secured Debt
Debt Instrument [Line Items]
Modified interest rate on notes payable				10.00%	10.00%
Period of debt repayment					Quarterly
Maturity date of notes payable					Dec. 31, 2018
Debt conversion per share				$ 0.16	$ 0.16
Promissory Note
Debt Instrument [Line Items]
Modified interest rate on notes payable				3.25%	3.25%
Period of debt repayment				Due quarterly, over a 3 year period
Recognized original issue discount on Note payable				$ 74,568	$ 74,568	$ 99,426

Notes payable (Details 1)

Notes payable (Details 1) - USD ($)	Dec. 31, 2018	Jun. 30, 2018
Maturities of notes payable, net of discounts, are as follows:
December 31, 2019	$ 1,042,139
June 30, 2020	330,496
Notes payable	$ 1,372,635	$ 1,615,132

Notes payable (Detail Textuals)

Notes payable (Detail Textuals)	Mar. 15, 2016	Sep. 23, 2014	Feb. 25, 2014USD ($)Investor	Sep. 30, 2018USD ($)$ / shares	Dec. 31, 2018USD ($)$ / shares	Jun. 30, 2018USD ($)	Jan. 20, 2017$ / shares
Debt Instrument [Line Items]
Notes payable					$ 1,372,635	$ 1,615,132
Senior Secured Promissory Notes
Debt Instrument [Line Items]
Number of investors | Investor			3
Proceeds from issuance of initial notes			$ 501,000
Maturity date of notes payable	Sep. 30, 2016	Mar. 15, 2016	Feb. 24, 2015		Dec. 31, 2018
Monthly interest rate percentage			12.00%		12.00%
Proceeds from issuance of notes payable			$ 1,500,000
Notes payable					$ 0	$ 23,000
Accrued interest					$ 478,000
Conversion price | $ / shares					$ 0.16		$ 0.16
Aggregate amount of remaining outstanding notes				$ 23,000
Conversion rights granted, price per share | $ / shares				$ 0.16

Notes payable (Detail Textuals

Notes payable (Detail Textuals 1)	Dec. 15, 2016USD ($)	Sep. 23, 2014USD ($)Days$ / shares	Dec. 31, 2018USD ($)$ / shares	Dec. 31, 2017USD ($)	Dec. 31, 2014USD ($)	Dec. 31, 2018USD ($)$ / shares	Dec. 31, 2017USD ($)	Jun. 30, 2018USD ($)
Debt Instrument [Line Items]
Amount of long term notes payable			$ 330,496			$ 330,496		$ 736,115
Convertible Secured Debt
Debt Instrument [Line Items]
Interest rate on notes payable			10.00%			10.00%
Conversion price | $ / shares			$ 0.16			$ 0.16
Financing and Security Agreement | Convertible Secured Debt
Debt Instrument [Line Items]
Maximum borrowing capacity through issuance of convertible secured debt		$ 1,500,000
Maximum borrowing capacity for each tranche		$ 150,000
Additional amount of tranche issued					$ 100,000
Amount of long term notes payable			$ 250,000			$ 250,000		250,000
Outstanding amount under financing agreement	$ 100,000
Due date of convertible secured debt		24 months
Extended due date of convertible secured debt		12 months
Interest rate on notes payable		10.00%
Interest rate of convertible secured debt if extended after due date		12.00%
Percentage of common stock price to conversion price of convertible debt instruments		85.00%
Number of specified trading days that common stock price to conversion price of convertible debt instruments must exceed threshold percentage | Days		15
Conversion price | $ / shares		$ 1.28	$ 0.16			$ 0.16
Interest expense			$ 12,600	$ 6,250		$ 6,300	$ 12,600
Accrued interest			$ 94,000			$ 94,000		$ 81,000

Notes payable (Detail Textual_2

Notes payable (Detail Textuals 2)	Oct. 14, 2015Days	Dec. 31, 2018USD ($)USD_Per_share	Sep. 30, 2018USD ($)	Jun. 30, 2018USD ($)	Jun. 10, 2015USD ($)$ / sharesshares
Debt Instrument [Line Items]
Notes payable		$ 1,372,635		$ 1,615,132
Principal payments of notes		$ 244,355
Warrants
Debt Instrument [Line Items]
Number of common stock called by warrants | shares					2,000,000
Exercise price | $ / shares					$ 0.75
Term of warrants					4 years
Convertible Promissory Note
Debt Instrument [Line Items]
Accrued interest			$ 600,000
Description of maturity of promissory note		(i) 25% discount to the next round of financing prior to conversion in excess of $1 million; or (ii) $.30 per share; or,(iii) Commencing six months after issuance date, at the investor's sole discretion, at a 20% discount to the lowest trading price ten business days prior to conversion.
Fair value of warrant as additional paid-in capital		$ 78,707
Discount on promissory note		480,100
Derivative liability due to the lack of explicit limit on the number of shares		$ 401,393
Description of adjustable pricing mechanism	20% discount to the lowest trading price
Number of threshold trading days | Days	10
Interest rate on notes payable		10.00%			10.00%
Convertible promissory note					$ 600,000
Convertible Promissory Note | Volatility of common stock
Debt Instrument [Line Items]
Long-term debt, measurement input		76
Convertible Promissory Note | Risk-free interest rate
Debt Instrument [Line Items]
Long-term debt, measurement input		0.28
Convertible Promissory Note | Forfeiture rate
Debt Instrument [Line Items]
Long-term debt, measurement input		0
Convertible Promissory Note | Value per share of common stock
Debt Instrument [Line Items]
Long-term debt, measurement input | USD_Per_share		0.45
Convertible Promissory Note | Strike price
Debt Instrument [Line Items]
Long-term debt, measurement input | USD_Per_share		0.75
Convertible Promissory Note | Term
Debt Instrument [Line Items]
Long-term debt term		4 years

Notes payable (Detail Textual_3

Notes payable (Detail Textuals 3) - USD ($)	1 Months Ended		3 Months Ended		6 Months Ended
	Feb. 28, 2017	Dec. 29, 2016	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Jun. 30, 2018
Debt Instrument [Line Items]
Cash payment to related party		$ 440,000
Principal payments of notes					$ 244,355
Outstanding balance of notes payable			$ 1,042,139		1,042,139		$ 879,017
Bridge Notes Payable
Debt Instrument [Line Items]
Debt discount recognized related to issuance of shares	$ 57,000
Maturity date of notes payable	Jul. 28, 2017
Common stock, shares	75,000
Aggregating amounts of notes	$ 345,000
Debt discount	$ 102,000
Promissory Note
Debt Instrument [Line Items]
Debt principal payments			65,000		65,000		424,000
Accrued interest			34,000		34,000		12,000
Interest expense					22,000	$ 31,000
Cash payment to related party		$ 440,000
Notes issued period		3 years
Notes issued		$ 2,000,000
Common stock purchase warrant year		5 years
Number of common stock called by warrants		1,520,000
Shares price		$ 0.50
Accreted to interest expense on notes payable			12,500	$ 12,500	25,000	$ 25,000
Outstanding balance of notes payable			1,197,000		1,197,000		1,441,000
Indemnification payments			$ 179,000		$ 179,000		$ 135,000
Estimated fair value of the warrants		$ 174,000
Number of warrants excercised				250,000
Purchase price				$ 125,000

Stockholders' deficit (Detail T

Stockholders' deficit (Detail Textuals) - USD ($)	3 Months Ended	6 Months Ended	18 Months Ended
	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2018
Stockholders Equity Note [Line Items]
Common stock issued for services		912,000
Value of common stock issued for services		$ 1,300,000
Number of common stock for cashless exercise		449,500
Promissory Note
Stockholders Equity Note [Line Items]
Number of warrants excercised	250,000
Purchase price	$ 125,000
2013 Equity Incentive Plan
Stockholders Equity Note [Line Items]
Stock-based compensation		$ 1,474,000
Common Stock | 2013 Equity Incentive Plan
Stockholders Equity Note [Line Items]
Number of common stock for cashless exercise			622,000

Stock-based compensation - Summ

Stock-based compensation - Summary of valuation assumptions for stock options issued (Details) - 2013 Equity Incentive Plan - stock options	6 Months Ended
	Dec. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Dividend yield	0.00%
Expected life in years	3 years 6 months
Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected volatility	232.16%
Risk-free interest rate	2.33%
Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected volatility	234.30%
Risk-free interest rate	2.44%

Stock-based compensation - Su_2

Stock-based compensation - Summary of stock option activity (Details 1)	6 Months Ended	12 Months Ended
	Dec. 31, 2018USD ($)$ / sharesshares	Jun. 30, 2018USD ($)$ / sharesshares
Options
Outstanding at June 30, 2018	3,141,876
Granted	0
Exercised	(449,500)
Forfeited	(380,750)
Outstanding at December 31, 2018	2,311,626	3,141,876
Vested options	1,939,126
Remaining options expected to vest	298,000
Weighted Average Exercise Price per Share
Outstanding at June 30, 2018 | $ / shares	$ 0.21
Granted | $ / shares	0
Exercised | $ / shares	0.43
Forfeited | $ / shares	0
Outstanding at December 31, 2018 | $ / shares	$ 0.36	$ 0.21
Weighted Average Remaining Contractual Term (Years)
Weighted Average Remaining Contractual Term (years), Outstanding	4 years 9 months 15 days	5 years 2 months 23 days
Aggregate Intrinsic Value
Aggregate Intrinsic Value, Outstanding | $	$ 994,126	$ 6,168,665

Stock-based compensation (Detai

Stock-based compensation (Details 2) - Non-Qualified Stock Options - January 20, 2017	6 Months Ended
	Dec. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected volatility	134.81%
Dividend yield	0.00%
Risk-free interest rate	1.50%
Expected life in years	3 years 6 months

Stock-based compensation (Det_2

Stock-based compensation (Details 3) - Non-Qualified Stock Options - February 28, 2018	6 Months Ended
	Dec. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Dividend yield	0.00%
Expected life in years	3 years 6 months
Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected volatility	232.16%
Risk-free interest rate	2.37%
Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected volatility	233.60%
Risk-free interest rate	2.39%

Stock-based compensation (Det_3

Stock-based compensation (Detail Textuals)	3 Months Ended		6 Months Ended		12 Months Ended
	Dec. 31, 2018USD ($)Member$ / sharesshares	Dec. 31, 2017USD ($)	Dec. 31, 2018USD ($)unitMemberFrozen_yogurt_robots$ / sharesshares	Dec. 31, 2017USD ($)	Jun. 30, 2018$ / shares	Apr. 30, 2016shares	Jul. 13, 2015shares	Aug. 14, 2013shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation	$ 711,195		$ 1,473,729	$ 124,375
Remaining options expected to vest | shares	298,000		298,000
Number of options granted to employees and consultants | shares			0
Weighted Average Remaining Contractual Term (years), Outstanding			4 years 9 months 15 days		5 years 2 months 23 days
Vested options | shares			1,939,126
Weighted average exercise price | $ / shares	$ 0.36		$ 0.36		$ 0.21
Non-Qualified Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of options granted to employees and consultants | shares			660,000
Number of board members | Member	2		2
Vesting period			36 months
Non-Qualified Stock Options | January 20, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation to be recognized			$ 140,000
Estimated fair value of the options			698,000
Remaining stock-based compensation			$ 163,000
Vesting period			24 months
Vested options | shares			4,400,000
Non-Qualified Stock Options | February 28, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation to be recognized			$ 1,190,000
Number of options granted to employees and consultants | shares			1,175,000
Estimated fair value of the options			$ 6,464,000
Remaining stock-based compensation			$ 4,207,000
Vesting period			24 months
Vested options | shares			5,596,000
Chairman | Non-Qualified Stock Options | January 20, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of non qualified stock options | shares			5,000,000
Percentage of non qualified stock options			50.00%
Number of frozen yogurt robots | Frozen_yogurt_robots			400
Cumulative revenue			$ 15,000,000
CEO | Non-Qualified Stock Options | January 20, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of non qualified stock options | shares			500,000
Percentage of non qualified stock options			50.00%
Number of frozen yogurt robots | Frozen_yogurt_robots			800
Cumulative revenue			$ 30,000,000
Chairman, CEO and management employees | Non-Qualified Stock Options | February 28, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise price | $ / shares	$ 0.87		$ 0.87
Number of options granted to employees and consultants | shares			6,375,000
Chairman, CEO and management employees | Non-Qualified Stock Options | February 28, 2018 | First 50% options vest
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Description of options vest			The options vest 50% upon 1,200 units installed or $45 million in cumulative revenue
Percentage of options vest			50.00%
Number of units installed | unit			1,200
Cumulative revenue			$ 45,000,000
Chairman, CEO and management employees | Non-Qualified Stock Options | February 28, 2018 | Second 50% options vest
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Description of options vest			50% upon 2,000 units installed or $75 million in cumulative revenue
Percentage of options vest			50.00%
Number of units installed | unit			2,000
Cumulative revenue			$ 75,000,000
2013 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Aggregate number of shares | shares						6,000,000	4,000,000	2,600,000
Stock-based compensation	$ 45,000	$ 144,000	91,000	$ 280,000
Remaining stock-based compensation			$ 203,000
Vesting period			24 months
Weighted Average Remaining Contractual Term (years), Outstanding			4 years 9 months 15 days
Vested options | shares			1,939,126
Weighted average exercise price | $ / shares	$ 0.19		$ 0.19

Leases (Detail Textuals)

Leases (Detail Textuals)	Aug. 01, 2015USD ($)ft²	Dec. 31, 2018USD ($)	Dec. 31, 2017USD ($)	Dec. 31, 2018USD ($)	Dec. 31, 2017USD ($)
Leases [Abstract]
Area of warehouse | ft²	8,654
Term of operating lease	84 months
Operating expenses for facility leases	$ 15,995
Future minimum lease payments under operating leases December 31, 2019	196,928
Future minimum lease payments under operating leases December 31, 2020	202,554
Future minimum lease payments under operating leases December 31, 2021	208,377
Future minimum lease payments under operating leases December 31, 2022	214,403
Future minimum lease payments under operating leases thereafter	$ 17,909
Rent expense		$ 70,000	$ 55,000	$ 124,000	$ 111,000

Commitments and contingencies (

Commitments and contingencies (Detail Textuals)	Jun. 06, 2018Investor$ / sharesshares	May 19, 2018shares	Jun. 30, 2018USD ($)$ / sharesshares	Dec. 31, 2018USD ($)$ / shares
Commitments And Contingencies [Line Items]
Unconditional Purchase Contracts | $				$ 4,633,000
Common stock, value per share | $ / shares			$ 0.001	$ 0.001
Matching bonus paid to chairman | $			$ 332,000
Franchisee Contract
Commitments And Contingencies [Line Items]
Term of contract		18 months
Total consideration		300,000
Number of common share issued		50,000
Vesting period		3 months
Franchisee Contract | July, 2017 through April, 2018
Commitments And Contingencies [Line Items]
Matching bonus paid to chairman | $			$ 16,400,000
Investor Agreement | Private Placement
Commitments And Contingencies [Line Items]
Number of investors | Investor	2
Investor Agreement | Private Placement | June 6 through June 30, 2018
Commitments And Contingencies [Line Items]
Number of common share issued	300,000		300,000
Common stock, value per share | $ / shares	$ 1
Investor Agreement | Private Placement | July 1 through September 30, 2018
Commitments And Contingencies [Line Items]
Number of common share issued	1,000,000
Common stock, value per share | $ / shares	$ 1
Investor Agreement | Private Placement | October 1 through December 31, 2018
Commitments And Contingencies [Line Items]
Number of common share issued	1,333,333
Common stock, value per share | $ / shares	$ 1.50

Related party transactions (Det

Related party transactions (Details) - USD ($)	Dec. 31, 2018	Jun. 30, 2018
Related Party Transaction [Line Items]
Notes payable	$ 1,372,635	$ 1,615,132
Less current maturities	(1,042,139)	(879,017)
Notes payable, excluding current maturities	330,496	736,115
Related Party
Related Party Transaction [Line Items]
Notes payable	296,779	536,786
Less current maturities	(296,779)	(536,786)
Notes payable, excluding current maturities	0	0
Related Party | Secured Promissory Notes
Related Party Transaction [Line Items]
Notes payable	296,779	296,779
Related Party | Convertible Promissory Note
Related Party Transaction [Line Items]
Notes payable	$ 0	$ 240,007

Related party transactions (D_2

Related party transactions (Detail Textuals)	1 Months Ended
	Oct. 27, 2015USD ($)Micro_Market	Dec. 31, 2018USD ($)	Jun. 30, 2018USD ($)
Related Party Transaction [Line Items]
Prepaid expenses and other current assets		$ 80,389	$ 70,149
Convertible Promissory Note
Related Party Transaction [Line Items]
Principle amount of debt	$ 250,000
Maturity period for notes payable	18 months
Number of micromarkets | Micro_Market	50
Secured Promissory Notes
Related Party Transaction [Line Items]
Principle amount of debt	$ 250,000
Maturity period for notes payable	1 year
Notes payable minimum amount to be paid	$ 75,000
Socially Responsible Brands, Inc
Related Party Transaction [Line Items]
Proceeds from issuance of convertible secured debt	$ 500,000
Socially Responsible Brands, Inc | Nicholas Yates
Related Party Transaction [Line Items]
Percentage of ownership by chairman	20.00%

Related party transactions (D_3

Related party transactions (Detail Textuals 1) - USD ($)	Oct. 09, 2018	Jan. 13, 2015	Jul. 31, 2017	Jan. 20, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2018	Dec. 31, 2017	Jun. 30, 2018
Related Party Transaction [Line Items]
Proceeds from issuance of common stock, net of issuance costs							$ 1,724,993
Amount paid to related party							0	$ 20,000
Matching bonus paid to chairman									$ 332,000
Repayments of Notes Payable							244,355
Convertible Notes Payable
Related Party Transaction [Line Items]
Repayments of Notes Payable	$ 240,000
Accrued interest	14,000
Prepaid expenses and other current assets	$ 254,000
Socially Responsible Brands, Inc
Related Party Transaction [Line Items]
Modified interest rate on notes payable				20.00%
Maturity date of notes payable				Dec. 31, 2017
Conversion price				$ 0.16
Nicholas Yates
Related Party Transaction [Line Items]
Common stock, shares issued			150,000
Percentage of terms of agreement			50.00%
Proceeds from issuance of common stock, net of issuance costs			$ 200,000
Nicholas Yates | January 2015 Note
Related Party Transaction [Line Items]
Proceeds from issuance of notes payable		$ 200,000					550,000
Modified interest rate on notes payable		10.00%
Maturity date of notes payable		Dec. 31, 2016
Outstanding amount of loan							0		$ 240,000
Loan portfolio expense					$ 0	$ 0
Conversion price				$ 0.16
Discount on the loan							300,000
Nine Dragons Investments
Related Party Transaction [Line Items]
Loan amount				$ 300,000
Proceeds from issuance of notes payable				$ 209,931
Modified interest rate on notes payable				10.00%
Conversion price				$ 0.16
Short-term advances to officer
Related Party Transaction [Line Items]
Prepaid expenses and other current assets							$ 10,000	$ 28,000

Discontinued operations (Detail

Discontinued operations (Details) - USD ($)	3 Months Ended		6 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Other expenses:
Gain from disposition of operations		$ (704,794)	$ 141,502	$ (1,405,146)
Fresh Healthy Vending LLC
Revenues [Abstract]
Total revenue, net	$ 0	132,037	10,091	288,784
Cost of revenues	0	29,822	5,237	79,380
Gross margin	0	102,215	4,854	209,404
Operating expenses:
Personnel	0	395,777	0	648,541
Marketing	0	0	0	0
Professional fees	0	0	26,451	30,713
Insurance	0	10,112	0	22,939
Rent	0	7,784	6,199	20,101
Depreciation and amortization	0	3,338	0	3,770
Stock compensation	0	144,239	0	155,953
Provision for legal settlement	0	213,621	0	304,280
Other	0	6	(8,918)	86,480
Total operating expenses	0	765,953	32,656	1,272,776
Income (loss) from operations	0	(663,738)	(27,802)	(1,063,372)
Other expenses:
Interest expense	0	(40,985)	0	(121,699)
Derivative liability income (expense)	0	0	0	(220,003)
Loss before provision for income taxes	0	(704,723)	(27,802)	(1,405,074)
Provision for income taxes	0	0	0	0
Loss from operations	0	(704,723)	(27,802)	(1,405,074)
Gain from disposition of operations			169,304	0
Net gain (loss)	0	(704,723)	141,502	(1,405,074)
Fresh Healthy Vending LLC | Vending machine sales, net
Revenues [Abstract]
Total revenue, net	0	34,457	0	93,539
Fresh Healthy Vending LLC | Franchise fees
Revenues [Abstract]
Total revenue, net	0	1,150	0	7,295
Fresh Healthy Vending LLC | Company owned machine sales
Revenues [Abstract]
Total revenue, net	0	0	0	0
Fresh Healthy Vending LLC | Royalties
Revenues [Abstract]
Total revenue, net	0	82,132	8,041	155,113
Fresh Healthy Vending LLC | Other
Revenues [Abstract]
Total revenue, net	$ 0	$ 14,298	$ 2,050	$ 32,838

Discontinued operations (Deta_2

Discontinued operations (Details 1)	Jun. 30, 2018USD ($)
Current assets:
Cash	$ 26,417
Restricted cash	1,500
Accounts receivable, net of allowance for doubtful accounts of $174,011	18,451
Inventory on-hand, net of allowance for obsolete inventory of $100,000	246,296
Current assets held for disposition	292,664
Current liabilities:
Accounts payable and accrued liabilities	280,159
Contract liabilities - customer advances and deferred revenues	515,517
Provision for franchisee rescissions and refunds	496,000
Total current liabilities	$ 1,291,676

Discontinued operations (Deta_3

Discontinued operations (Details 1) (Parentheticals)	Jun. 30, 2018USD ($)
Discontinued Operations and Disposal Groups [Abstract]
Allowance for doubtful accounts	$ 174,011
Allowance for obsolete inventory	$ 100,000

Subsequent events (Detail Textu

Subsequent events (Detail Textuals)	Feb. 05, 2019USD ($)
Subsequent Event
Subsequent Event [Line Items]
Refund amount for agreement termination	$ 140,000